Put Your Numbers to the Test: Data Quality in Sustainability Measurements and Communication

Transcription

1 Put Your Numbers to the Test: Data Quality in Sustainability Measurements and Communication

2 About Us Kathy Tejano Rhoads Principal Consultant Summer Broeckx-Smith Data Analyst & Head of CDP Services 2

3 Guest Speakers Shreya Sonar Byron Thayer Andy Cummings 3

4 Agenda 1. Sustainability performance 2. Key data characteristics 3. Insights from guest speakers 4. CEDA database 5. Key takeaways 6. Q&A 4

5 1. Sustainability performance 5

6 Number of G250 Companies Number of Respondents Corporate Performance CDP Supply Chain Questionnaire , , Climate Targets

7 Number of G250 Companies Reporting Gap Corporate Emissions Reporting Scope 1 Scope 2 Scope 3 (Upstream) Scope 3 (Downstream) 14 7

8 Knowing Your Sustainability Impacts 1 4 Operational Supply Chain 8

9 Benefits Of Closing The Gap Enhance Brand Value Reduce Cost & Improve Efficiency Innovation Respond to Investor Inquiries 9

10 POLL QUESTION: Has your company ever performed a sustainability impact analysis? If so, what was it used for? Select one: Enhance brand value Identify areas to reduce environmental impacts Identify supply chain related risks and opportunities Respond to investor ESG inquiries All of the above 10

11 Sustainability Impact Measurements + Methodology Data 11

12 2. Key data characteristics 12

13 Data Characteristics Checklist Base year and frequency of updates 13

14 Data Characteristics Checklist Base year and frequency of updates Consistency 14

15 Data Characteristics Checklist Base year and frequency of updates Consistency Completeness in scope and breadth 15

16 Data Characteristics Checklist Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology 16

17 Data Characteristics Checklist Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility 17

18 Data Characteristics Checklist Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility Uncertainty 18

19 Uncertainty How good is the data? Would you rather be roughly right or precisely wrong? 19

20 Overcoming Data Limitations Iterative Analysis 1. Identify hot spots 2. Refine the results targeting the hot spots 3. Repeat until the data quality goal is met 20

21 Understanding Data Trade Offs Keep in mind: Impacts of analysis Use of financial resources Future repetition of reporting External inquiries regarding results 21

22 3. Insights from guest speakers 22

23 Guest Speaker: Shreya Sonar Shreya Sonar Sustainability Analyst 23

24 What is RefScale?

25 Tool: RefScale RefScale & Impact For each Reformation product, we use RefScale to measure Farm to End-of-Life impacts Benchmark with conventional clothing Benefits External: Shared with customers on web Internal: Raw material and process selection

26 RefScale & Impact Data Quality Primary data Peer reviewed journals Published books PDFs O Ecotextiles Verification via 3rd party consulting firm

27 RefScale & Impact Challenges Cashmere and alpaca data System boundaries Quantifying certifications Wet processing visibility Assumptions 52 washes/garment cycle Deadstock fabrics Conventional clothing

28 Guest Speaker: Byron Thayer Byron Thayer Manager Sustainability Performance & Reporting 28

29 LS&Co. uses iterative approach to data gathering We completed two LCAs prior to our Scope 3 climate change estimate LCA #1 (2007) 1 Product US only LCA #2 (2015) 3 Products Global Scope 3 (2017) All products Non-product categories 29

30 In 1 st LCA, hot spots drove us to improve data For a pair of 501 jeans, consumer use (laundry) has the greatest impact. But we only looked at US consumers laundry habits Transport, Logistics, Retail 11% End of Life 3% Consumer Use 37% Climate Change Impacts by Phase Fiber 9% Fabric Production 27% Cut, Sew, Finish 8% Sundries & Packaging 5% 30

31 In 2 nd LCA, we further explored our hot spots We compared regional consumer use habits, not just US 70 Lifetime Consumer Use Non-Renewable Energy (kwh) Americas Europe Asia Washing every 10 times a product is worn instead of every 2 times reduces global warming impact by 80% 31

32 In 2 nd LCA, focused on fabric assembly impact of denim vs. khaki Fabric assembly of 501 jeans is 50% more impactful than Dockers khakis kg of CO2e FIBER FABRIC ASSEMBLY CUT, SEW, FINISH SUNDRIES & PACKAGING TRANSPORT LOGISTICS RETAIL CONSUMER USE END OF LIFE TOTAL Levi s Dockers Khakis

33 With Scope 3, focused on missing data Expanded view to all products, including leather goods. Addressed 11 different areas of Scope 3, including non-product sources (commuting, capital goods, business travel, etc) (Ultimately, product impact far greater than everything else) LS&Co s annual carbon footprint is 5 million metric tons CO2e. Equivalent to: Emissions generated by the state of Vermont 1MM more than San Francisco 33

34 Avoid paralysis by analysis Just get started! But we simultaneously improved data precision AND created programs to reduce impact. At first, we focused on accuracy over precision. Know hot spots and make 100% sure that in the ballpark (accuracy), then later sharpen numbers to multiple decimal points (precision) 34

35 LS&Co. is about to start third round of GHG targets We set first round of targets in 2007 (after 1 st LCA) Likely meet our second round of targets early (25% absolute reduction in scopes by 2020 vs baseline) CEO recently committed to setting third round: Science-Based Targets + Scope 3 targets. 35

36 We are addressing cotton and consumer impact, even with imperfect data We are founding member of Better Cotton Initiative. Traceability is challenging. We launched and Care Tag for the Planet and consumer education campaign to reduce laundry impact. But we can t measure impact easily. 36

37 Guest Speaker: Andy Cummings Andy Cummings Account Manager Supply Chain 37

38 {{ We want to see a thriving economy that works for people and planet in the long term. To do this we focus investors, companies and cities on taking urgent action to build a truly sustainable economy by measuring and understanding their environmental impact. CDP s Mission {{

39 CDP model

40 Importance of Data Quality { Setting a science-based target { Meeting your customers sustainability goals { Understanding hot spots in your value chain { Reducing scope 3 emissions { Tracking year-on-year progress

41 Case study: Dell Technology Dell s guidelines for suppliers: { Report GHG emissions via CDP (minimum scope 1 and 2, scope 3 encouraged) { Set public goals to reduce operational GHG impacts { Tier 1 suppliers to establish GHG management and reporting requirements for their suppliers { Report on water via CDP Water { Publish a GRI-based sustainability report In 2016, Dell achieved an industry-leading response rate of 95.4 percent, and in aggregate, their suppliers reduced 6.1M metric tons of CO2e in the last reporting year, equal to $606M in savings related to emissions reductions. Dell publicly states: {{ Failure to meet these requirements can impact your supplier ranking and potentially diminish your ability to compete for Dell's business. {{

42 More repeat participants reducing emissions

43 4. Comprehensive Environmental Data Archive (CEDA) database 43

44 CEDA 380+ sectors exchanges 44

45 VitalMetrics CDP Scope 3 Tool 45

46 Data Characteristics Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility Uncertainty 46

47 Data Characteristics Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility Uncertainty 2014 base year, annual updates 47

48 Data Characteristics Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility Uncertainty ISO 14040/ base year, annual updates 48

49 Data Characteristics Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility Uncertainty ISO 14040/ base year, annual updates 380+ sectors, exchanges 49

50 Data Characteristics Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility Uncertainty ISO 14040/ base year, annual updates 380+ sectors, exchanges Published in a peer reviewed article in

51 Data Characteristics Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility Uncertainty ISO 14040/ base year, annual updates 380+ sectors, exchanges Published in a peer reviewed article in 2005 Formatted in Excel, annual license available 51

52 Data Characteristics Base year and frequency of updates Consistency Completeness in scope and breadth Transparency of methodology Accessibility Uncertainty ISO 14040/ base year, annual updates 380+ sectors, exchanges Published in a peer reviewed article in 2005 Formatted in Excel, annual license available Geometric standard deviation 52

53 Leveraging CEDA Corporate greenhouse gas accounts (e.g., CDP) Investment portfolio footprints Sustainable spend analysis Product carbon footprints 53

54 Sustainability Spend Analysis Note: This table has been truncated. 54

55 Thousand metric tons CO2e Product Carbon Footprints Sweetnat 2% Others 15% Chocolate 3% Oils 3% Dairy Products 5% Soy 8% Flour 36% Fiber Inulin 11% Oats 18% Ingredients Carton Packaging Electricity Corrugate Packaging Natural Gas Kashi Durable Goods Others 55

56 5. Key takeaways 56

57 Take Home Messages Quality data is the foundation of sustainability analysis Consider data tradeoffs when measuring your organization's sustainability performance CEDA can be leveraged to achieve robust environmental impact analyses Corporate greenhouse gas accounts (e.g., CDP) Investment portfolio footprints Sustainable spend analysis Product carbon footprints 57

58 QUESTIONS? Submit them through the chat box If you have any further questions, please reach out to us at: or at 58