Ecological accounting and reporting that gives you goose bumps

Robert Mostyn
Sep 12, 2018 · 5 min read
Copyright http://www.explorestsimonsisland.com

Melanie sunk into a leather chair and propped her pre-lunch gin and tonic on a coffee table at her elbow. She could keep an eye on the door for the arrival of Mark. It was their regular fortnightly lunch at their city club.

She had been in her role as Sustainability and Environmental Director at a FTSE 100 company for two years. She and Mark had been at university together and kept in touch ever since. He worked for a leading firm of sustainability consultants and they enjoyed exchanging professional and personal news.

While staying within their own bounds of confidentiality, they had helped each other on critical occasions with news and innovation in what was a fast-moving field. Mark had just been to a European trade fair and Melanie was itching to get a briefing on what he had brought back.

Mark greeted the concierge and made an energetic entrance. He saw Melanie at once and, not for the first time, admired her ability to look casual and stylish at the same time.

After the perfunctory cheek kisses, they chatted about personal news while the savvy maître d’hôtel brought Mark a glass of his favourite claret.

One of their current key issues was ecological accounting and costing. Mark had a particular idea that he wanted to run past Melanie but he tried to keep the mood light by telling a joke: “Why was the horse so happy? Because he lived in a stable environment.” She chuckled, even though it was an old gag.

After a couple of stories about travel delays and weather, Mark gave a short report on the trade fair. “One of the most interesting stands was a small British company,” he recounted. “They were refreshingly short on jargon and I could understand what their software did. That’s not always the case with some of the bigger suppliers!”

“The company name is also a unit of ecological cost — ecoCost: they can integrate their software into existing accounting systems.” “That’s all well and good,” said Melanie, “but what variables do they measure?”

“ecoCost includes standard carbon emissions but also tackles other crucial factors such as water usage, ecotoxicity and resource depletion, 15 distinct eco-metrics, in fact.

I have three clients who need to comply with the new streamlined energy and carbon reporting regulations (SECR) in 2019 and I introduced them to ecoCost, partly because they are offering a trial free-of-charge to use ecoCost as an efficient reporting tool.”

Melanie looked puzzled. “Why risk recommending a small player like ecoCost when there are well-known carbon accounting methods and consultants?”

“Well, they used an interesting phrase — Ecological Integrity. What I think it means is that rather than just meeting current carbon reporting regulations, companies could take an holistic view of ecological reporting and provide a true, futureproof picture of their full ecological footprint.”

“But, if we did that, we might be at a commercial disadvantage against firms who just provided the minimum carbon footprint data that SECR demands,” she argued.

“I think the opposite. ecoCost is attempting to ensure all relevant decision-makers are joined up with a consistent approach to measuring impact; with each entity taking responsibility for its burden on the environment.

Eco-innovation implemented upstream is automatically communicated downstream and the final consumer is also considered in the accountability challenge. The data is dynamic and practically real-time, if a whole supply chain adopts the method. Business and consumers are becoming increasingly-sophisticated about linking business activity to planetary resources and ecoCost is the nearest thing to total environmental accountability that I saw at the fair.”

Melania grabbed a pad and drew a rough diagram. “You mean ecoCost would facilitate the passing on of real-time ecoCosts up and down a supply chain?” She drew rectangles and arrows and ended with consumers at the foot of the stack. Mark grabbed her pen and made a few amendments to her diagram.

“The ecoCost method extends the existing financial accounting process to account for material exchanges, from substances taken from — and returned to — nature; such as gasses burned, electricity consumed and a record of materials that are recycled or sent to landfill.

It also includes every supplier in a value chain such as raw materials, services and the electricity and other energy resources they consume. And the ultimate customer — the individual consumer — is considered too. They’ll receive an ecoCost rating for the products they purchase based on real, live operational data, rather than a static database.”

“Let’s go and eat,” suggested Melanie.

After the meal, over a port, they returned to the theme. “Let’s just say that we used ecoCost for our annual SECR reporting, how would we present the data?”, Melanie shrewdly asked. “And what if none of our suppliers used ecoCost? We wouldn’t get any upstream data to work with.”

“One of my clients asked that same question. The ecoCost team demonstrated how data could be exported at each stage for presentation. As for a lack of supplier data, ecoCost can still be setup using open data sources but this might involve some configuration and consultancy work”.

“So, you are saying that the ecoCost value becomes a business asset and a purchasing incentive to both suppliers and buyers?” Melanie postulated.

“I think so’, Marks stated confidently. “Picture all this easily integrated within your existing accounting system. Using ecoCost would be as straightforward as financial reporting. Imagine going to the Board with these figures and publishing them in the Annual Report. The share price might sharpen up and you might get a lot of kudos”.

They stared at each other and then laughed. Corporate politics were more complex than that but data was power. Melanie had a vision of really justifying her role and being consulted on any corporate initiative for ecoCosts alongside the purely financial projections of her colleagues.

As Mark signed for his meal, they clinked their glasses and wished “To ecoCost: may she reign supreme”.

Mark hurriedly left for an overdue meeting, Melanie thought through what they had discussed.

She finished her port and stared at the ceiling. Thoughts of making her role much more significant to her company’s business success gave her goose bumps.

ecoCost: your footprint at your fingertips

An automated system that accounts for all the ecological costs for your product. Combining your resource movements with ecoCosts from suppliers, they are merged into one true end-to-end value of carbon costs, water usage, ecotoxicity and several other environmental values.

Robert Mostyn

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ecoCost is a new ecological accounting method that will provide a complete account of human activity related to planetary boundaries.

ecoCost: your footprint at your fingertips

An automated system that accounts for all the ecological costs for your product. Combining your resource movements with ecoCosts from suppliers, they are merged into one true end-to-end value of carbon costs, water usage, ecotoxicity and several other environmental values.