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Speeding Up Carbon Drawdown by Helping the Inactive Become Active

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Big Business’s Carbon Reporting ‘But’

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Should carbon reporting innovators use language that challenges business bosses, or panders to them?

Business bosses think of themselves as Leaders. Is it effective or imprudent to tell boardrooms they’re Followers when it comes to carbon reporting? This article weighs the pros and cons of deferring, denouncing, and debating, asking whether to catch flies with vinegar or honey.

Speaking Truth to Power vs Diplomacy

Here’s a familiar dilemma for journalists, salespeople, politicians and preachers, or anyone in possession of a little-acknowledged Truth. Do you:

  • Wave your Truth in people’s faces, expecting the facts to convince them? 
  • Dress up yourTruth in a more palatable form, to smooth the path?

This dilemma is shared by climate activists, whether they seek to advocate by ‘raising awareness’, or empower with carbon-busting innovations.

What should the climate-conscious do, when most governments, businesses and media, faced with the Truth of global heating, la-la-la the climate crisis?

When facing power-wielders in command of levers that can reduce the most carbon quickest, what’s the right tone to use?

Is it more effective to shout the Truth in their faces, or put an arm around their shoulders and whisper it in their ears?

Is there even any point in addressing people with fingers wedged firmly in ears, and their eyes resolutely scrunched shut?

Is it smarter to seek out the minority with open eyes, ears and minds?  Even then, should you say the same thing in the same way to all of them, or adapt  your message, tone and register?

Is government regulation supporting your innovation always your friend, or can it sometimes be your foe? 

Climate innovators will always have to contend with many complicating external factors, but the language they choose to use is something over which they have complete control.

Grandmothers may tell you it’s better to catch flies with honey than vinegar.

But what if honey lets all the flies escape, and vinegar sometimes works on some flies?

Face-Shouting vs Soft-soaping

Before plotting a middle path, or considering bespoke approaches, let’s first examine the extremes described above. 

The risk and rewards of extreme face-shouting are well documented. They’re increasingly well understood by the climate activists who deliberately choose this option.

Think of the pin-up for impassioned face-shouting, stat-blaster extraordinaire and accomplished online assassin, Greta Thunberg. 

‘Greta’ is venerated by those who agree with her, and has almost certainly swelled their numbers. But she’s also vilified by those who disagree. 

Greta’s high profile and powerful, direct language deters many ordinary people. That’s face-shouting’s inherent risk – it might repel more of the undecided than it attracts. Greta’s blunt, direct language gives her allies something to cheer in person, and share online. But it also provides the climate-wary with a useful target to attack the messenger rather than engage with her ‘listen to the scientists!’ message. 

Other prominent face-shouters include Just Stop Oil protestors. They risk injury, public opprobrium, the police and the courts, by expressing the climate crisis Truth via eye-catching, non-violent. civil disobedience actions.

Creating traffic chaos by glueing yourself to motorways certainly generates headlines. It probably also shifts the Overton Window of public debate over time. Anyone unconvinced or uncertain how to respond to such challenging actions will almost certainly be convinced by posterity – but that doesn’t reduce any carbon today.

In the short term, their words have resulted in 4-year jail sentences by an English judge for discussing civil disobedience on a Zoom call.

Extreme soft-soaping carries different risks and rewards. If you bend over too far backwards to accommodate others, it’s easy to be deflected or distracted from your initial purpose.  To use, ahem, ‘direct’ language, if you bend too far backwards, kiss too many arses and  accommodate too many arseholes, you risk disappearing up your own. 

Consider the carbon offset market. Created in 1988 as an elegant, beguiling, market-based solution to greenhouse emissions, it’s now become a discredited greenwashing figleaf that has enriched men in suits  by a trillion dollars, by facilitating rich companies paying poor people to plant trees so they can carry on business as usual, while carbon emissions continue to rise.

So here’s the dilemma. 

Speak too bluntly, and you risk being ignored by the people holding the biggest carbon-reducing levers. 

Speak too softly, and your message is lost as the status quo subverts your elegant market-forces-based system, turning your good intentions into a papal-indulgence system of paying a small fee to carry on sinning.

Which way to go? Must climate activists, including those offering innovative practical solutions, pick a side? 

Is there a sweet spot in between, where you’re blunt enough to communicate your climate Truth, but diplomatic enough to smooth the path to sustainability?

Case Study – See Through Carbon

Innovative carbon standard See Through Carbon faces this dilemma.

See Through Carbon alerts business bosses to the inconvenient Truth that the current commercial carbon accounting standard system they’re using isn’t fit for purpose.

It’s ‘pitch’ is that the status quo is ‘ICOP’ (Inaccurate, Costly, Opaque and Proprietary), and the solution it offers is ‘AFOT’ (Accurate, Free, Open-Source and Transparent’).

See Through Carbon’s global network of pro bono experts is currently running a series of seven pilots to prove the concept. If successful, ‘STC’ hopes to displace commercial carbon accounting standards by offering a free-at-point-of-use service.

This enables businesses who can’t afford commercial carbon reporting to accurately report their carbon emissions – so long as their footprints and reduction history are made public. Making emissions reporting public by default is STC’s ‘catch’. It follows a the now-familiar disruptive, data-based, rapibly-scalable model used by social media giant. Give useful ‘free’ services with one hand, take heaps of data with the other. STC only diverges from the Facebook/Google/TikTok model by measuring output in tonnes of carbon dioxide equivalent reduced or sequestered, instead of dollars. 

See Through Carbon’s free-to-use service permits bigger businesses currently paying for carbon reporting to put this money to better use, for example paying consultants to advise them on how to reduce carbon, rather than on standards to measure it inaccurately.

STC’s global team of pro bono creators means STC can move fast, unencumbered by funding rounds or the need to compromise its mission by proving its profitability to investors. And everyone involved has a good story to tell, that they’re motivated by carbon reduction without the lubricant of cash. As the STC strapline has it, ‘If you can’t buy integrity, why should you be able to sell it?’.

Since its September 2023 launch, See Through Carbon has made rapid progress, ticking off a series of milestones early critics were confident would be unattainable without money. Its seven pilot schemes are now in various stages of development, the first participant’s public page due to be made public within a year of its launch, with many more to follow.

See Through Carbon focuses on small and medium businesses because, even though SMEs generate 70% of global business emissions, the current system fails them. Small businesses can’t afford the additional cost of carbon reporting, and are not yet required by law to either do carbon audits, or make them public, in the same way they’re required to report their financial statements.

See Through Carbon is using the Pilots to develop an app and database system that would enable it to work at scale. Using the social media business model used by Google, Facebook etc., STC swaps a ‘free’ service for data.

The difference is that instead of monetising its data by selling it to advertisers, STC will make its clients’ carbon reports public by default in order to further accelerate carbon drawdown. That’s ‘the catch’, which STC thinks of the critical paradigm-shift required to accelerate carbon drawdown.

As soon as See Through Carbon announced its pilots, big businesses got in touch.  

They were keen to know more not because they were prioritising decarbonisation over profit, but because they’d been following a geopolitical-level face-shouting vs soft-soaping drama taking place in Washington and Brussels.

IRA vs CSRS: razzle-dazzle vs. bureaucratese

In recent years, despite relentless lobbying from vested interests, the US Congress and the EU have both passed landmark ‘climate-friendly’ legislation. One caused a very public ruckus, the other hardly anyone has heard of. Both, in their own ways, are game-changers.

Using different carrots and sticks, Washington and Brussels have stopped hoping to nudge big business into reducing carbon, and have started instructing them to do so – including enforceable penalties for non-compliance.

America’s Inflation Reduction Act (2022) and the EU’s Corporate Sustainability Reporting Directive (2023) significantly change the rules of the world’s two biggest markets. The goals of the ‘IRA’ and ‘CDRD’ are explicitly to decarbonise their economies to meet the UN’s Paris Agreement net-zero in particular, and Sustainable Development Goals (SDGs) in general.

Both pieces of legislation are written in legalese, but both were named and debated in instructively different ways.

In passing the IRA, the Biden administration expended considerable political capital to break Congress’s bitter bipartisan logjam. Amid great public debate, the IRA committed America to spending around $500Bn to reduce carbon emissions by 33–40% below 2005 levels by 2030.

In naming their bill, Democrat legislators chose to sacrifice atmospheric physics truth for partisan political expediency. By calling it the ‘Inflation Reduction Act’, they cannily appeased boardrooms, as well as voters, by dressing climate action in financial clothes.  

The EU’s CSRD is arguably even more ground-breaking and bold. Brussels braved  relentless lobbying from vested interests to reach consensus. The EU’s low-profile, sneak-attack approach is reflected in the dull name they chose for it, concealing its climate Truth behind bland bureaucratese.

From a boardroom perspective, the IRA is largely carrot. It’s not hard to understand the commercial appeal of half a trillion dollar’s worth of carrot, so we won’t explore it further for this article.

The CSRD is more stick, its main motivation being that compliance will avoid the expensive fines and penalties it specifies.

Getting a piece of a massive government investment fund is a corporate no-brainer. Complying with new legislation provokes a more defensive search for loopholes, evasion or more nuanced risk/reward analyis of the costs of compliance and non-compliance.

How have boardrooms responded to this landmark EU legislation, since it became law in January 2023?

Brussels v Boardrooms

The CSRD was so low profile, hardly any business leader has even heard of it, even months after it passed into law. 

But everyone knows that when it comes to the law, ignorance is no defence. 

How and why the CSRD is such a game changer requires translation from the impenetrable EU-speak of ‘double materiality’ into plain English. Here’s the executive summary:

  • No More Voluntary Reporting: Any business trading in the EU now has to publicly report its emissions.
  • No More Greenwash: Businesses now have to use the rules set out by the EU to calculate their emissions.
  • No More Self-Reporting: Businesses now have to use 3rd party verification to calculate their emissions.
  • No More Under-reporting: Businesses have to include Scope 3, i.e. the indirect emissions of their supply chain.

The CSRD preamble, in a rare outbreak of plain speaking, declares its aim,

‘to transform the Union into a modern, resource-efficient and competitive economy with no net emissions of greenhouse gases by 2050’

The bulk of the CSRD legislation closes these and other loopholes. It also details the penalties imposed for non-compliance, and spells out a staggered schedule, by business size and sector, for its rollout.

Many details of timelines and metrics are left sketchy. This could be the result of lobbying from businesses hoping that might leave loopholes, or deliberately ambiguous, leaving the details of how to comply to market forces, innovation and entrepreneurial spirit. This is approach California has taken in setting zero tail-pipe emissions for vehicles, without specifying exactly how this should be achieved. 

Either way, the CSRD is now law. Any business that trades with the EU, wherever it may be based, will at some point be required to be compliant.

The CSRD may lack the IRA’s marketing pizazz, but it unambiguously marks the end of the era of voluntary reporting and the start of mandatory carbon reporting, all itemised and enforced via explicit government regulation.

And for anyone looking at it closely, hiding in the small print, the CSRD contains one giant contradiction. This is the Big But that See Through Carbon seeks to resolve, and in doing so hit the right tone in talking to businesses.

Brussels’ Big But

Brussels’ Big But becomes evident if you restate the items of the Executive Summary above thus:

  • No More Voluntary Reporting: For their carbon reporting to be accurate, credible, and verifiable, businesses must now use the carbon accounting rules set by the EU.
  • No More Greenwash: and make their accurate, credible, and verifiable carbon reports public. 
  • No More Self-Reporting: To ensure their public reports are accurate, credible and verifiable, businesses can’t mark their own homework. Even the 3rd-parties they use must be transparent about their methodology and calculation. 
  • No More Under-reporting: No public carbon report can be accurate, credible and verifiable unless businesses include all upstream and downstream indirect emissions.

The big businesses obliged to comply with the CSRD from Day One immediately understood the problem. We could call it ‘The CSRD’s Scope 3 Reporting Contradiction’, but in the spirit of using plain language, we’ve gone with ‘Brussel’s Big But’.

How can big businesses accurately measure their Scope 3 indirect emissions without: 

a) accurately measuring the carbon footprints of their SME supply chain

b) assigning the appropriate percentage of their suppliers footprints to their own total?

It’s a ‘but’ because business executives’ most common (=’normal) response when offered a carbon reporting solution is to raise objections. They say they want solutions, yet have a long list of reasons for inaction to hand, all beginning with the word ‘but’.

How to solve a problem like Scope 3?

When faced with complying with a new EU directive, most big businesses start out by adopting one of the first four of the five types of responses taxonomised in this article

  • Ignore
  • Dodge
  • Pretend
  • Exploit

A far-sighted minority go for the fifth option:

  • Embrace

The Embracers recognise carbon reporting’s direction of travel, and opt for genuine leadership and example-setting. Rather than look for loopholes to evade the spirit of the law, they decided to embrace both letter and spirit.

There aren’t very many of them.

However, the Embracers soon discovered Brussels’ Big But. Search the internet for ‘Scope 3 for Businesses’ online workshops, seminars, lectures and panel discussions, and you’ll find plenty of people asking the right questions, dating from when it was clear the CSRD would become law. 

But attend these workshops, read the transcripts of these discussions, follow the Heads of Sustainability, consultants, and even government officials, and you’ll find they fail to come up with any answers.

Their usual carbon reporting fixers, commercial carbon accounting standards, are unable to help, for three very obvious reasons:

  1. Inaccurate: In many cases, they don’t count Scope 3 emissions.
  2. Non-compliant: Most of those that did count Scope 3 then ‘offset’ them with discredited carbon credits that don’t comply with the CSRD, are too opaque to meet the EU’s transparency requirements, or their methodologies are too hidden behind a proprietorial IP-protective black box for them to be examined.
  3. Costly: Even if their methodologies could be CSRD-compliant, there was a far more intractable problem –  SME’s can’t afford their fees.

In other words, the only tools available were ICOP. The only tool that could fix the problem was AFOT.

New AFOT tool for a new CSRD problem 

This was why sharp-eyed CSRD Embracers started contacting See Through Carbon within days of its September 2022 launch.

They recognised See Through Carbon’s AFOT model was a potential solution to an otherwise intractable problem created by the new EU law.

They’re now waiting for STC to complete its pilot programme and develop an app, and prove it can measure SME’s carbon footprints accurately, reliably, verifiably, quickly and at scale. 

If it works, See Through Carbon, and any other AFOT solution, will be the golden ticket to CSRD compliance. It will resolve the new law’s giant contradiction by:

  • Providing comprehensive, CSRD-compliant reports for big businesses
  • Providing SMEs with accurate carbon reports free of charge
  • Assigning the correct proportion of SME footprints to their big business clients without exposing commercially sensitive information, i.e. each SME’s degree of dependence on their big customers.

How to talk to businesses

Let’s return to the question posed at the beginning of this article. Is is best for those seeking to decarbonise to use honey, or vinegar, to trap flies?

Or to put it more diplomatically, how diplomatic should See Through  Carbon be, in an urgently deteriorating climate crisis, when talking to big businesses?

The more STC dials down the blunt talk, the easier they are to ignore. Honeyed words may flatter, but they’re slippery.

Downplay undercutting current commercial carbon calculators by providing a free service to SMEs, and See Through Carbon risks hiding its dazzling Unique Selling Point beneath a bushel.

See Through Carbon’s real-world experiences when approached by big businesses, however, suggest there may be merit in applying a bit of vinegar.

Homo boardroomens vs Homo averagejoeus

Remove the designer suits, Swiss watches, and multi-zeroed bonuses, and boardrooms are another bunch of evolved apes sitting around a table. Boardroom executives are subject to the same prejudices, triggers and insecurities as the rest of us. The difference is that neither they, nor the people addressing them, are used to using the direct language we might use to talk to friends, a child, or a stranger.

What separates Homo boardroomens from Homo averagejoeus is power. Generally, the powerful tend to believe themselves to be much more rational, and less driven by emotion, than the rest of us. 

They’re more likely to attribute their high status to native ability and merit than blind luck or privilege. They’re more adept at covering up their emotion-driven insecurities with fancy talk than the average Joe.

These qualities often manifest as ‘self-confidence’, ‘assertiveness’, even ‘intelligence’. In reality, Homo boardroomens simply carry a different, better-disguised set of insecurities and prejudices from Homo averagejoeus.

When it comes to climate change in general, and CSRD compliance in particular, See Through Carbon must decide whether to talk to someone in a boardroom differently from, say, an inquisitive child?

Not in the sense of using simple words or simplifying concepts, but in the sense of telling the truth in a straightforward manner, rather than worrying about what the child may think.

Even comparing a boardroom executive to a child can be taken the wrong way, if you’re looking to be offended. And whether the executive is looking for excuses to take offence, or is happy to listen to a straightforward argument plainly states, is the crux of the matter.

Embrace the Embracers, Ignore the Ignorers

Take website mission statements at face value, and it’s easy to swallow boardroom blurb of being ‘thought leaders’, trailblazers and pioneers. 

When it comes to embracing what they perceive to be a potential cost (boardroom diversity, carbon reduction), rather than a potential asset (e.g. AI, cryptocurrency), most business people become more circumspect.

Start talking about accurate carbon reporting, and executives can turn out to be just as timid and risk-averse as the rest of us. But not all Homo boardroomensus are the same. 

Mention taking action to reduce carbon, and most are reflexive, and unreflecting, Ignorers, Dodgers, Pretenders or Exploiters. We know why, because most of us share the same head-in-the-sand impulses when confronted with something unpleasant. We’ve evolved to prefer beguiling lies over inconvenient truths

But a small minority of business leaders are authentic Embracers of decarbonisation. Embracers can be motivated by anything from moral guilt, to personal embarrassment resulting from an awkward question from a shareholder, employee or grandchild. They might be motivated by reputational gain, or even avarice.

For innovators offering novel solutions, like See Through Carbon, what matters isn’t why, but if.

Even if you’re a monopolistic market leader, trying to please all the boardrooms all the time is impossible. It seems imprudent to adopt the same tone when you’re introducing something new, like See Through Carbon’s AFOT carbon standard.

Nearly all companies, when push comes to shove, see their ‘green’ policy as ornamental, or at best peripheral. When it comes to taking action, most boardrooms prioritise continuing business as usual with minimal interruption rather than acting out of morality, or being early adopters of carbon reporting.

Apply grandma’s aphorism about catching flies, and hard-headed business folk are unlikely to be swayed by honeyed words.

But some might be open-minded and empathetic enough to be moved by tart, blunt home truths. 

The benefits of targeting acetiphilic flies

If vinegar-loving flies are the only ones See Through Carbon is likely to attract, why should it hold back when delivering home truths about corporate timidity and hypocrisy on carbon reporting?

We’re not talking about using the language of some passionate protestors, or for activist over-reach. Fossil fuel companies are the problem, not all of capitalism. Greenwashing companies are the problem, not all corporations. Hypocritical executives are the problem, not all boardroom executives.

If you’re trying to educate or persuade, using mocking, demeaning or abuse is ineffective in any context, and the boardroom is no exception.

But being polite doesn’t preclude speaking plainly. Speaking truth to power can be done without pandering to individual egos, or fearing of offending high-status executives.

Such acetiphilic fly business leaders probably spend much of their own time wondering how to get their tone right, whether convincing sceptical colleagues, underlings, or investors. If they align with STC’s goals and strategy, they already understand the problem. What they’re looking for are practical solutions based on evidence, reason and logic. So just tell it like it is.

CSRD Embracers with the courage to grasp the CSRD challenge know it brings a precious reputational prize – being first adopters of a future-proofed carbon accounting standard.

They know that their sector can only ever have one first adopter, one pioneer, one trailblazer. First adopters carry that prize forever, condemning the Ignorers, Dodgers, Pretenders and  Exploiters competition to Follower status. By the time their timorous rivals have been forced to abandon discredited offsetting-based standards, CSRD embracers will already be able to point to their public record of compliance an carbon reduction, if they choose standards like See Through Carbon.

For their Follower rivals, any short-term reputational greenwashing gain will soon evaporate, leaving them playing catch-up with the adopters of AFOT standards.

They’ll also have to explain their negligence to their investors, shareholders, colleagues, employees, customers children and grandchildren. It’s not such a good story.

Telling Better Climate Stories

Strip away all the technocratic EU jargon about Scope 3, double materiality and 3rd-party verification, and we’re all just apes who’ve evolved to love a good story.

From the boardroom to the backroom, we’re all storytellers who love a good yarn. The best stories are the ones that cast us as the heroes.

Who wants to tell their grandchildren the story of How We Caught Up, when they have the chance to tell them We Were First?

Accurate, Free, Open-source, Transparent projects like See Through Carbon offer business leaders the chance to be the heroes of their own corporate, and personal, stories.

But only if they have the courage to tell them.