Carbon Management(Continued)

Why manage carbon from a business perspective?

From: Burtis and Watt, 2008, p. 18

Corporate Carbon Performance Indicators (Hoffman & Busch, 2008)

• Carbon intensity• Carbon dependency• Carbon exposure• Carbon risk

From: Hoffman and Volkers, 2008, p. 509

Carbon Intensity

• Extent to which a company’s business activities are based on carbon usage for a defined scope and fiscal year.

• =carbon usage /business metric– Business metrics: Unit of production, turnover

(sales), total costs, costs of goods sold, value-added, EBIT (earnings before interest & taxes), market capitalization or equity

Carbon Intensity

• Carbon input intensity: “amount of carbon needed within the production process”– E.g. producing plastic polymers requires

petroleum feedstocks but will not produce carbon emissions

• Carbon output intensity: emission of GHGs (accounting for off-sets)

Carbon Dependency

• How much does the company rely on carbon over time? (Dynamic View)– “change in a company’s physical carbon

performance within a given time period”– Relative performance change from status quo to

predicted carbon intensity

Carbon Exposure

• “A company’s monetary carbon performance; describes monetary implications of the business activities due to carbon usage for a defined scope and year”

=carbon usage (in monetary terms)/business metric

Carbon Risk

• Change in a company’s monetary carbon performance within a given time period; relative performance change from status quo to the predicted carbon exposure

Works Cited

• Burtis, Bill and Iain Watt. 2008. Getting to zero: Defining carbon neutrality. Clean Air-Cool Planet and Forum for the Future.

• Hoffman, Volker H. and Timo Busch. 2008. Corporate carbon performance indicators. Journal of Industrial Ecology 12(4), 505-520.