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The 'Social Footprint' of Climate Change
Joel Makower, 20 Aug 06

A new report offers a methodology for calculating your company's social footprint on climate change.

Your company's what?

Most of the conversation about business and climate change in recent years has to do with which companies are "doing their part" to reduce their greenhouse gas emissions. But what, exactly, is "their part"? How can you tell whether a company's greenhouse gas emissions reductions are sufficient to reverse global warming and stabilize carbon dioxide concentrations in the earth's atmosphere at an acceptable level?

The Vermont-based Center for Sustainable Innovation has just published an intriguing document that extends its "social footprint" methodology into the climate arena. It yields "quantitative measures of the social sustainability of behaviors -- collective organizational behaviors, in particular," says the group.

If you thought measuring your company's ecological impacts on the climate was tough, you ain't seen nothing yet.

First, some background. The social footprint, says CSI, is "a measurement and reporting method that quantifies the social impact of an organization on people." Unlike the ecological footprint, which is a method for measuring and reporting the impact of societies and organizations on natural resources (a.k.a. "natural capital"), the social footprint deals with societies' and organizations' impacts on what CSI calls "anthro capital," a term that encompasses both human capital and social capital. Unlike natural capital, which is limited and which only nature can create, anthro capital is produced by people and can increase. The goal of measuring social footprints, says CSI, is "to assess the sustainability of organizational operations in terms of their impacts on strategies for achieving climate change mitigation."

Translation: the social footprint looks beyond whether a company's efforts to reduce its greenhouse gas emissions are merely worthy or exemplary, but whether they are sufficient to actually solve the problem.

CSI performed a climate social footprint analysis on six organizations: BP, BT, Johnson & Johnson, Shell, United Technologies, and "an anonymous university." To do so, it compared the organizations' greenhouse gas emissions to "WRE350" targets, then divided this by the number of employees ("people feet") to arrive at a quotient -- a quantitative measure of environmental impact in human terms (the "societal quotient"). WRE350 -- named for its three creators, Wigley, Richels, and Edmonds -- is a scientific model that forecasts carbon emission reductions necessary to reverse carbon dioxide build-up in the earth's atmosphere (currently at about 385 parts per million), and stabilize them at a non-threatening level of 350 parts per mission by 2150.

Only three of the companies studied -- BP, BT, and United Technologies -- were deemed "sustainable," according to the CSI analysis, though BP's score was seen to be declining over the 2001-2005 period covered by the research. Johnson & Johnson, in contrast, while not considered sustainable, was deemed to be improving and "nearing sustainability."

It's early-stage, cutting-edge stuff, to be sure. It asks companies to accept at face value such concepts as "actual annual carbon emissions per capita per people foot" (the latter term being an adjusted headcount metric "to reflect time spent at work vs. elsewhere," says CSI). It goes beyond merely tracking aggregate greenhouse emissions, assessing whether a company's climate strategy and performance can actually help stem a climate crisis over the long term.

All of which may be a stretch for the myriad of companies still grappling with more conventional measures of climate impact, such as how many pounds of carbon they emit for each widget they make, but it seems no less important.

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I am not expert on 'social capital', although 'human capital' seems straightforward...

The ecological footprint should measure the impact on the ecosystem, which includes humans (like it or not)... our existence sprouts from the ecosystem, and so the other 'capitals' should be subservient to it.

The ecological footprint can therefore not simply be defined as 'impact on natural resources'... its effect is much broader than that on 'capital', which provides a narrow, business-oriented view of existence... which is the root of the problem.

How, for example, do you value potential extinction of a species which 'serves no useful purpose' for the industry whose footprint that you are trying to quantify is threatening that species?

Posted by: Vladimir Orlt on 20 Aug 06

Dear Vladimir:

Thank you very much for your comments about our Social Footprint method. I completely agree with your statement about the hierarchical position of the human economy as a system within the earth's ecology. Still, the Ecological Footprint does not address the impact of humans on human systems such as social capital, so we need a separate tool to do that. The same is true for human capital and built or constructed capital.

Nor does the Ecological Footprint offer a means of measuring the contribution of an organization to fulfillment of a social plan (or not), such as a plan to mitigate global warming or combat poverty. Again, the Social Footprint fills that need.

Thus, we really need both tools (and others) to measure and report the total sustainability performance of an organization.



Posted by: Mark McElroy on 5 Sep 06



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