Capitalism Revised

Stephen Bay
Nov 14, 2019 · 6 min read

Currently, 9 out of 10 Fortune 500 companies voluntarily report their emissions. Scope 1 defines the company’s emissions from their direct operations. Scope 2 covers their indirect emissions for example the electricity they use. Scope 3 covers other indirect emissions related to other parts of their business including supply chain, transport and materials used. Many of these companies are taking active steps to reduce their scope 1, 2 and 3 emissions. Now, Skanska’s Director of Sustainability, Stacey Smedley, has proposed that Scope 4 should cover the emissions related to one’s workforce. After all, if employees have long commutes to work those emissions are generated in part by where the company chooses to locate itself. When combined with the Business Roundtable’s commitment to sustainable capitalism, this represents an opportunity for the world’s largest companies to take over global leadership in combating climate change from political leaders who mostly seem unable to implement any solutions

On August 19th, 2019, the 181 CEOs of the Business Roundtable signed a pledge committing their corporations to sustainable capitalism. This represents a staggering opportunity to take real action on global sustainability because of one simple fact: the wealthiest people in the world are disproportionately responsible for the world’s pollution. Wealthy countries like the US pollute far more than poor countries and the wealthiest people in those countries pollute far more than the poor people in those countries. In fact, 10% of the world’s population produce 50% of the world’s fossil fuel pollution. If you want to make a big impact on the world’s sustainability, then targeting the wealthiest people in the world is the fastest and most effective way to do it. Not only that, the wealthy have a disproportionate ability to affect the rest of our lives. The corporations of the Business Roundtable employ 15 million employees in the US. By greening their workforce and following through on their public commitment, those 181 CEOs could make a huge impact — reducing emissions, improving local communities, and creating a healthier / happier workforce.

It is time for Corporations to take the lead in saving the world

Currently, 9 out of 10 Fortune 500 companies voluntarily report their emissions. Scope 1 defines the company’s emissions from their direct operations. Scope 2 covers their indirect emissions for example the electricity they use. Scope 3 covers other indirect emissions related to other parts of their business including supply chain, transport and materials used. Many of these companies are taking active steps to reduce their scope 1, 2 and 3 emissions. Now, Skanska’s Director of Sustainability, Stacey Smedley, has proposed that Scope 4 should cover the emissions related to one’s workforce. After all, if employees have long commutes to work those emissions are generated in part by where the company chooses to locate itself. When combined with the Business Roundtable’s commitment to sustainable capitalism, this represents an opportunity for the world’s largest companies to take over global leadership in combating climate change from political leaders who mostly seem unable to implement any solutions

The average US household generates 48 metric tons of CO2 emissions annually. This is equivalent to burning 52,000 pounds of coal. If we were able to reduce the CO2 emissions of each of the 125 million households by 4 metric tons, then we would hit the 500 million metric ton annual reduction. Breakthrough Energy Ventures, backed by such business titans as Bill Gates and Warren Buffett, has identified this as the target for for the US to do it’s part in the fight against climate change. Simply by improving insulation and weatherizing homes, this could be easily achieved. Moreover, this would not only generate jobs but improve not only the comfort of the American people but also reduce the associated healthcare costs that come from living in improperly heated and ventilated homes. However, the concerted political action at the national and local level required to achieve this doesn’t look like it’s coming anytime soon. By contrast, once the Business Roundtable baselined their employees emissions, simply greening its 15 million employees they could achieve over half that target by implementing three simple changes for example:

Encourage Carpooling, Public Transport or using Lyft when commuting.

Simply by getting employees to carpool or switch to public transport just once a week, the Business Roundtable could reduce their emissions by 32.66 million metric tons of CO2 per year. Businesses could partner with sustainable transport providers incentivizing employees to use Waze Carpool or even offer a free Lyft ride. Since Lyft offsets the emissions from every single ride, this free Lyft ride would be carbon neutral.

Incentivize the installation of smart thermostats

Massive amounts of carbon emissions come from heating and cooling homes when there’s no need. Either because nobody is home or because the outside temperature doesn’t require it. Smart thermostats learn homeowners’ habits and many even have built in motion sensors to make sure they heat and cool homes only when it will benefit the people who live there. The cost and energy savings are pretty staggering. Based on 20,000 home energy assessments, we estimate that the impact of 15 million employees switching to a smart thermostat would be 6.2 million tons of CO2 annually.

Switch Employee Households to Green Power

Average household energy consumption in the US is responsible for 14.7 metric tons of CO2 every year. Fortunately, reducing this to zero is now easier than ever. Not only has home solar gone from a novelty to a viable proposition but many utility companies, like Puget Sound Energy, offer consumers the option to purchase all their energy from renewable sources. Some utility companies such as Seattle City Light have even switched their entire energy supply to renewable sources meaning that all their customers are using renewable energy. By combining incentives from utilities with their own incentives, employers could help their entire workforce switch to green power.

The symbolic effect of such a drastic change would be to place businesses definitively at the forefront of humanity’s efforts to make our use of the planet more sustainable and more fully convince the public of the net positive impact of capitalism in all our lives. Beyond symbolism, the reductions in carbon emissions would be dramatic. Simply by installing smart thermostats, getting employees to commute differently once a week and switching employees homes to green power, the Business Roundtable would reduce carbon emissions by 248.86 million metric tons annually. That’s nearly half of the carbon emission reduction goal identified by Breakthrough Energy Ventures. With that kind of leadership from big business, we are confident that medium and small businesses will join the fight against climate change and get us all the way to the 500 million metric ton target and perhaps even beyond.

Of course, Scope 4 is new territory for all of us and that is why Employees.Eco was founded. For years, utility companies have offered incentives for homeowners to reduce their energy consumption that have largely gone unclaimed. By connecting utility companies, homeowners, their employers and services like Waze Carpool, we will not only track reduction in carbon emissions but create an ecosystem where the corporate world supported by available government incentives can collaborate to make our whole way of life more sustainable. Given that 9 out of 10 Fortune 500 companies already report their Scope 1, 2 and 3 emissions and the recent public declaration by the 181 CEOs of the Business Roundtable to sustainable capitalism, we are excited to help businesses lead the world by their example.

Originally published at https://www.employees.eco.

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