Think about reducing carbon emissions for a bit. What do you think about? Power plants and energy companies usually come to mind.
How about Etsy? Yeah, the online retailer.
Reducing emissions is an “everybody in the pool” proposition. Everyone has a stake in the effort, and Etsy illustrates that point.
Etsy is an example to a growing approach to the carbon reduction issue. The company’s big emissions come from shipping (75%, in fact) and from power use for its web presence in large part.
AdWeek magazine ran a report, Etsy’s Sustainability Director Shares the Plan for Totally Eliminating Carbon Emissions. The multi-step process of getting to zero is important to understand.
Etsy went carbon neutral in 2019. It bought offsets. “Most offsets take the form of environmental projects that can furnish the number of carbon credits a company needs. Offsets can include anything from capturing methane in landfills to financing efficient stoves for third-world countries to conserving a tract of hardwood forest to sponsoring a solar or wind farm,” says the AdWeek report. Worth reading.
Offsets are okay, but fairly easy in the scheme of things.
So, good, but not enough, says the sustainability lead at Etsy. The challenge is to be zero.
This involves scopes 1, 2 and 3 emissions that ECC wrote about before: “Scope1 emissions … are also called direct emissions. Scope 2 are emissions from generating energy the company (or person) buys, like electricity. Most firms have focused on Scopes 1 and 2 because they have more direct control. Scope 3 emissions are more expansive, for the entire value chain.” The graph below shows Scope 3 emissions from the industries with highest exposure. (Power generation was rated 1.1.)
Etsy’s sustainability chief says, “The big challenge comes with Scope 3… For Etsy, that means packages moving around the country on planes and trucks. To reach net-zero, the company will need to cut those carbon dioxide emissions by 13.5%.”
That means that Etsy must try to control what other people do – use emission-free vehicles in delivery, package in sustainable boxes, for instance.
These challenges are not just for companies, but everyone. Here’s why: Consumers are looking for more sustainable products and services. There’s a market, so companies respond. If companies don’t respond to increasing environmental demands they can lose business.
An interesting aside is this, too. Buying sustainably goes beyond a consumer wanting to do the right thing – it is image, too. “For many shoppers, though, choosing a sustainable product is a personal priority, and they want people to know it. It’s called Social Signaling, a theory that we buy certain things because of what they say about us to the people around us.” (Source)
Want to learn more about the way supply chains are decarbonization? Check the report, Transparency to Transformation: A Chain Reaction. Here’s the introduction to the report, “To understand the environmental impact of a company’s economic activity, it is not enough to look at its direct emissions and risks. The entire value chain must be engaged to evaluate and improve its performance. This report explores the state of environmental risks in supply chains and what approaches businesses are taking to mitigate them.”