An activist’s tool to nudge companies to take positive actions to reduce CO2 emissions.
This proposal is to create a Street Guide to Low Carbon Businesses.
It will be a platform whereby NGOs will be able to enlist their networks to crowdsource data on businesses in their locality, and publish the data, awarding a 5-star rating.
By highlighting their virtuous behaviour, companies will begin a ‘race to the top’, competing with other local companies to reduce their CO2 emissions.
Eventually, corporates of every size can become engaged in publishing their positive impacts for the first time. Then over time, more information is gathered to populate the ‘account’.
The users will be motivated to use an app to take photos and videos and submit evidence of positive actions. They will do this for a variety of reasons. Some will be altruistic - members of campaigning and fundraising charity networks. Others will be motivated by social and competitive pressures and rewards. Even schoolchildren (age 13+) could use this for Geography projects.
Each corporate may 'slide' into involvement. An 'account' can be created by anyone – eg a member of the public - who gains an answer to a simple question about a single activity – eg 'do you recycle paper'. At this point, an account is created by the user, and the company can subsequently enter more information to increase their rank among their peers. It may be possible to find open data sets which can be used to pre-populate the business accounts with metrics that help build a carbon-intensity profile of the each business.
The company then receives an email praising their actions, and showing other local companies who are also taking actions. This encourages them through peer-pressure to compete in the ‘race to the top’.
The app will maintain the user’s engagement with gamification, social marketing, a token scheme and a prediction market.
The whole credibility rests on how verifiable each piece of information is, and this can be enhanced using DLT technologies together with a carefully devised combination of verification steps.
How do you know that your solution is desirable to SMEs, and will reduce GHG emissions?
A survey in 2014 found that only 3% of businesses measure or report their impacts such as CO2 emissions.
A PWC report found that only 13% of businesses had identified the tools they needed for sustainability reporting. Presumably, fewer still will have purchased the tools - or use them effectively. Smaller businesses – which make as much as 70% of employees, are the least likely to be engaged.
M Meehan, Chief Executive, of the Global Reporting Initiative said at the time of the launch of the SDGs that accessing the right skills and developing the right tools formed businesses’ top priorities to understand and deliver sustainability impact assessments...'
Small companies still struggle to have the time, resources and tools to measure and report. This tool will use the crowd to jump start them by entering some data, it will be free initially and very easy to use, saving time and money and give them a reason to compete.
Surveys have been carried out in 3 locations in the UK and the companies have indicated a keen interest as the information is valuable and provides benefits in promoting their business. Further research is now being carried out in research by Cranfield university. The strongest theme from local businesses it that they felt that such as scheme would help them highlight the values and virtues of the local businesses. Some examples of responses are:
- One coffee shop owner, for instance, said that Trip Advisor provides much of their new customer base, and if they had a badge indicating that they were making a positive impact, they would definitely display the badge alongside the Trip Advisor logo.
- A small dry cleaner wanted to take part because it highlighted the virtues of local businesses and felt that it would help bring more vitality and foot-traffic to the town, building a stronger local community and business environment.
- A digital company initially couldn’t see the benefit, until it was pointed out that small businesses are increasingly asked to give details of their sustainability credentials when bidding for contracts. This company had recently lost 3 bids for contracts because they couldn’t provide information that this platform could have provided.
What actions do you propose?
This is how it works
The app will be pre-populated with open data that we can obtain about the businesses in Ontario.
Stage 1: The app user would gather additional information in one of these ways
- Take a photo/video of a piece of evidence of a positive action the business has taken that can reduce emissions (such as a notice saying 'we source local food' or an invoice from a supplier of renewable energy, or a poster indicating they are enacting in a low carbon policy)
- Ask a question about their low carbon initiatives eg ‘What do you recycle?’, and record their reply
- Email a suggestion such as ‘Will you adopt and publish a food waste policy’?
- If the company is promoting their participation of the scheme, to take evidence of that
- Every photo will have a timestamp and location reference
Stage 2: The information is passed to several online users who use their judgement to award points (using established criteria). All involved – the user, the online user, and the businesses earn points.
Stage 3: The manager is informed by email and can go online to see their score (and those of their competitors). When they are there, they can add further information (and receive more points) or make further pledges. They could also view examples of actions that they could adopt to support a low carbon economy. Lastly they could print off a certificate or window sticker to promote their participation in the scheme.
Stage 4: Users are incentivized using the points scheme to revisit and take further evidence. Any evidence gains them points. As awareness grows, companies will discover the advantage of displaying the information. This contributes to the growth and awareness of Ontario’s low carbon economy vision, and eventually it will reach a tipping point where companies compete to be ever more virtuous.
Stage 5: Companies will be rewarded if they gain information about their supply chain, and to get this information they will be asked to send their suppliers a link to an online ‘cascade’ questionnaire. This multiplies the number of businesses involved, increasing the impact substantially and immediately reach those companies where public access is restricted.
Stage 6: When established, local businesses will find ways of actively displaying their positive actions towards a low carbon economy - there should be visible signs of actions taken that can be photographed.
How will we project be managed?
The project is based on the Promise2030 concept which is at the incubation stage under a charity in the process of being set up called Innovira.
We are currently undertaking research with Cranfield University and have undertaken our first design sprint whereby we put the proposals to senior staff of UK NGOs, marketing consultants and a business. Results were very positive and future directions have been discerned. We are now ready to build an Minimum Viable Product (MVP) and this proposal is to build this round Ontario's use-case.
We will be using conventional technology platforms for the MVP which we will develop for use in Ontario, and there will be no requirement to generate an income stream during the MVP stage.
Who will take these actions?
A team is being drawn together to build the software platform, involving an UK digital agency, but participants are invited from the Climate Colab community globally - either with or without DLT interests and experience.
The project involves the following stakeholders:
NGO's charities: They would use the platform to further their charitable objectives in creating a better environment. They would be rewarded when they engage their networks to crowdsource data. We have carried out a Design Sprint and tested the concept with representatives from NGO management and have gained a positive response.
Users: a crowd that gathers information, uploads it and verifies it. Some will be activists motivated by altruism, while others will respond to gamification, or to incentives such as tokens. User motivations are currently being researched by Cranfield University.
Businesses: who become active having been nudged by users. They then input the remaining information, and gather information from their suppliers through sending them a link to online questionnaires. They provide the income to the scheme, through various mechanisms. Businesses have been surveyed, and further research into business reaction is being carried out by Cranfield University.
Where will these actions be taken?
We are UK based, and intended to pilot in a UK town. If there is a town/city in Ontario that can pilot the project, it would be perfectly possible as the software is not location dependent. In fact, to prove the replicability of the project worldwide, it would be an advantage to have a separateness between the location of software development and local implementation. Currently we are working with a UK based agency to deliver the MPV, though partners in Ontario can be considered.
What are the proposal’s projected costs?
The MPV will cost £180,000, and an estimate for a roll-out has been made of £2m
Once the solution is built and implemented describe a path forward for it to scale to other users/companies.
There is no limit to its scalability. Globally there are over 100 million SMEs, and we would target to reach most of these.
Eventually in the roll-out, it will incorporate the ability to generate income and provide micro-incentives for participants using digital ledger technology (DLT). We will also use providers such as the IXO foundation (for the tokenisation of impacts) and the Nori platform (to offer a carbon removal service to businesses, from which we can again a commission). Other income streams are fully listed in our whitepaper of our parent project at www.promise2030.org.
The roll-out will see an enhanced platform offered to Ontario and beyond, while the intension is to broaden the range of metrics to cover all 17 Sustainable Development Goals.
The ultimate goal is to create an environment where businesses are accountable to their communities, and where the businesses thrive best when they create positive impacts for their communities and the environment. We will do this by providing a sustainability reporting platform that is easy-to-use, auto-sign-up and driven by citizen participation.
We do not aim to take the place of current sustainability reporting platforms such as The Carbon Disclosure Project - CDP, or GRI or SEDEX etc, but wish to fill the gap where businesses have not engaged in sustainability reporting, by jump-starting businesses using bottom-up citizen engagement. Far from replacing existing platforms, we will encourage businesses to migrate onto the appropriate platform for their business, and to gain relevant certifications from existing certification bodies.
How will your solution lead to change on a larger scale over time (i.e. 3 to 5 years out)? How many businesses can potentially be affected by your solution?
There are over 115 million SMEs worldwide. We will start with one town/city - where there are less than 10,000, then scale up on scale up throughout Ontario. After 10 years we would be a global player reaching a significant proportion of global SMEs.
In the absence of a pilot with actual results, we could make some broad assumptions and create illustrative calculations to show how annual CO2e emissions reductions of 20% could be achieved after 5 years:
1. Emissions reductions of SMEs
Say, in year one we reached 50% of businesses in a pilot town, and 20% of them became active. So 10% of all businsses in the area are active, and if each achieved a 10% average reduction in emissions in the first year, that would provide a 1% reduction in SME emissions.
In subsequent years, further reductions of 1% could be achieved from this cohort, and deliver 1% reductions year on year. Meanwhile in year 2, a similar number of businesses engage and bring further emissions reductions, each making 10% annual reductions. So the total annual reductions after 5 years could be calculated as 5%+4%+3%+2%+1% = 15%.
*We have undertaken tests in the retail sector (which in the UK is 11% of businesses) show in initial surveys, and gathering details of a shop can be achieved within less than 10 minutes. In high density areas of shops, 6 shops can easily be surveyed in an hour by a volunteer. To visit a town with, say 600 shops, it would take 100 hours. A full time person could do this in 3 weeks.
In our test 70% answered at least some of our questions, and half of those gave an email contact whereby we could initiate an account.
2. Paying others to remove carbon from the atmosphere
In addition, we would offer Carbon Removal (we would choose Nori tokens - see explanation elsewhere). If after 5 years, 5% of businesses purchase them, adding a further 5% reduction in SME emissions.
Taking both 1 and 2 together = 20% reduction in SME emissions.
What business and funding model have you considered for your solution to become sustainable?
In the pilot, no income is budgeted for. For an organisational model (for the roll-out), we envisage a social enterprise, two-thirds owned by charities and one third by users - who are incentivised with tokens when they gather information.
The aim is to achieve an average income of $20 per business. (In Ontario there are 407,000 businesses, so that comes to $8.14 m per year. However, the service will be free at the start, so we'll assume that, over time, we achieve a 20% proportion of active and contributing businesses. This means that every active business needs to contribute $100.
1. OPTION 1: A fee for enhanced functionality
Freemium models often offer increased functionality for a subscription. We would offer businesses a premium desktop to manage their data, create reports to submit information to back up bids for contracts, or to comply with growing number of environmental regulations. While the data is pen data, only premium subscribers will have the enhanced desktop. To achieve the target of $20 per business, we would charge an average of $100, and aim for 20% participation = $20.
2. OPTION 2: Sale of CO2e offsets to active businesses.
While the Cap and Trade project has been cancelled, we don't know if a federal tax will be imposed. If businesses are left to initiate voluntary carbon pricing - which is happening globally, we could offer offsetting carbon removal through Nori - a blockchain based start-up. This is better than a wind farm that produces electricity without emitting more carbon. Nori only uses methods that actually remove carbon - eg burying carbon in the ground by asking farmers to increase the carbon content of the soil. Taking a price of $15 per tonne, and assuming a small business creates 60 Tonnes, then their offsetting costs would be $900. A 15% commission would amount to $135.
For other income streams go to Promise2030.org.
NB most other Sustainability reporting platforms start well above $1000 and can exceed $1m.
What impact will the proposed actions have on reducing greenhouse gas emissions?
Apart from the carbon emission reductions illustrated above, this project has an effect beyond SMEs - helping to sensitise all its contributors to the issues that relate to reducing carbon emissions, and this will no doubt result in the users reducing their domestic emissions, and influencing their families. The app will intentionally contain educational content to this end.
What are other key benefits?
The aim is to create a race to the top among businesses - to create an environment where to be successful, and revered by the communities they serve, they need to benefit society and the environment by cutting emissions being more sustainable.
In addition, the platform could be broadened to include metrics on all 17 UN SDGs
About the Authors
John Ranford has spent his successful career in international NGOs, carrying out marketing campaigns through a range of media, digital, TV, Radio and Direct Marketing.
Having spent his early years in Tuvalu - an island state threatened with flooding due to climate change, he is passionate to fight the causes of climate change
Related Proposals (optional)
A related proposal - which broadens the project to include all 17 SDGs is available here:www.promise2030.org