The Carbon Disclosure Project (CDP) is a not-for-profit organisation working with shareholders and firms to disclose the greenhouse gas emissions of major corporations. CDP works with 3,000 of the world's largest corporations to help ensure an effective carbon emissions reductions strategy is integral to their business. This effort is reinforced by the size of the shareholdings backing CDP - 315 institutional investors with $57 trillion under management. Via extensive questionnaires, it has established what is said to be the world's largest repository of GHG emissions and energy use data.

CEO Paul Dickinson has spent most of his career in the corporate communications industry and also runs to Videoconferencing booking firm Eyenetwork. With Tessa Tennant, doyenne of the sustainable investment movement in Europe, he founded the Carbon Disclosure Project in 2001.

How variable are the responses of major companies towards the challenge of climate change?

"At one extreme are the companies that don't respond [to both climate change and to CDP questionnaires on the subject]. We can't see any justification for not responding. If corporations aren't answerable to their shareholders then I wonder who they are answerable to. Anyway, that's how bad attitude can get.

"It improves from there. There are some curt responses, to more informed responses, to firms that really engage in a meaningful way with the whole subject area. We've had some superb responses. The first response we received was from Marks & Spencer's in 2002 and they pointed out that if they cut their washing temperatures for clothes by 10 degree centigrade it could knock half a percent off the entire UK electricity consumption.

"That kind of visionary thinking comes out of the best responses. What increasingly we're seeing, and what I find very exciting, is recognition not just of the problem, which is serious enough, but of the business potential around providing solutions."

Is carbon management seen as a business cost or a corporate asset?

"It's both. I have a friend who visits clients' premises on Christmas day in the UK and he measures their energy consumption and it's huge. They have no employees there at all, everything is shut down but there are lights and machines on and managers don't even know where the switches are. If you can stop that waste you make money and reduce emissions and, well, what's not to like about that, even if you must put a little time and effort into achieving it?"

How important is board-level backing for carbon reduction policies?

"There are two things going on here. We've got business phenomena, a bit like the Internet: something that's come along and changed everything. And the organisation might want to get on top of that earlier rather than later. Maybe they're going to do that better if the board backs it.

"But there's something else going on as well. Unlike the Internet, there is a broader, societal dimension which touches, legitimately upon the lives and ambitions of consumers.

"I think there is real potential in the years ahead for consumers to fall in love with companies that are providing a solution to this terrible problem and conversely to be horrified by companies which seem to be wantonly participating in its exacerbation. It is absolutely idiotic to think that consumers are just going to march like lemmings and pay their way, both to the cliff edge and pay to be pushed off it.

"Consumers represent the great democracy that is the genius behind capitalism... Every day we exercise, with the force of our money, our vote for one or another kind of future. That tendency, that capability, is going to make things go, in my view, far faster than anyone imagines towards a carbon constrained world. That's something I don't think any board would want to miss. That's something to which companies should pay very great attention because it's changing the world."

Is it necessary to appoint specific carbon information managers or teams?

"Again, there are some parallels with the Internet in the early and mid-Nineties. Corporate managers then asked: 'Who takes ownership of the Internet?' Was it the IT department? The marketing department? The PR department? The Operations Department? The Internet was finding its place and to some degree still is...

"At one level, if you really believe that this question [of climate change] goes right through the business, if you say this is the context in which we're going to make our money in the future, you could reframe the question and ask: 'Who is going to make the profits' and the answer is that it is shared by every function in the firm.

"So I'm giving you an unspecific answer. If I was asked to advise a company on their carbon management, I think you have a whole range of options from getting our environmental management department to do it; getting software in; getting external suppliers; appointing carbon champions in each division - the book hasn't been written yet on how to do it. The one piece of rock-solid advice is: 'however you think best, but do start.'"

How close are we to agreed, global standards for measuring greenhouse gas (GHG) emissions?

"There has been an emerging consensus for gauging greenhouse emissions and these are defined as Scope 1 (fossil fuels burned), Scope 2 (energy consumed) and Scope 3 (everything else - supply chain; product use and disposal; business travel) by the GHG Protocol. So, in the context of measuring, we have an agreed methodology for measuring Scope 1 and Scope 2 - arguably we're there. But with regard to Scope 3, the process has really only just begun.

"If you ask questions of your supply chain, you can begin to get some idea towards total emissions, but product use and disposal is a huge area and we are only at the beginning of reaching towards some common standards of measurement and analysis."

Are specific, percentage reduction targets necessarily the best way forward?

"There is a fierce debate going on regarding what is an appropriate business response to the problem of climate change. There will never be, I don't think, necessarily a conclusion to that debate.

"The way to prevent climate change is maximum reduction, instantly. So if one is in any kind of doubt about what one should do, you simply reduce your emissions as much as possible...

"There probably are distinctions to be made between emissions reductions which can be achieved with a return on investment that meets the company's internal targets. All such emissions reductions should probably be made immediately.

"But where there's a longer payback or where you need to research and development separate into new products and services, the company has to ask itself questions about how important this issue is. My view, as somebody who has spent their whole career in the corporate communications industry, is that there are probably fortunes to be made from being associated with solutions to this problem. So if I were personally hired as a consultant to advise people on whether to move slowly or quickly, then my instinct as a marketeer would be to say 'move quickly' and become a pioneer because you will get this back in market share and margins in years ahead."

Is there a gap in the education system regarding the training of carbon conscious and qualified practitioners?

"Yes. I keep referring back to the Internet analogy, but there were a very large number of people studying computer sciences but when there was this vast explosion of job creation around the World Wide Web, corporations found it very hard to find qualified developers. It might be better for universities to have longer and more prudent antenna which can see which way the wind is blowing.

"The oil is running out. The oil price is very high; there appear to be huge increases in demand for energy from India and China; there's the problem of energy security and, on top of all that, the cataclysm of climate change is laying like a suffocating blanket: I don't see any evidence that any of these effective, permanent, structural phenomena are going to subside in their impact in any way, shape or form. Therefore it would be idiotic, in my view, if the education system didn't direct the full force of its resources to doing the most it can, as quickly as it can, to prepare people for this very different world."

Is greenwash still a problem and is further legislation the answer?

"Part of the real challenge here is a cliché like 'greenwash.' Greenwash is a shorthand for ghastly, cynical, exploitative, defrauding of consumers. Is anyone for that? Of course not. I do think that in the future, the degree to which a product or service can demonstrate that it's to do with solving the problem of climate change will be a key differentiator in its success...

"If it takes government from time to time to pile in and curtail the cynics and the cheats, then fair enough. But conversely I would not like to see a situation where it's inappropriate for corporations to talk to their audiences and its consumers about 'green' issues for fear of having this cliché hurled against them."

What is your proudest low carbon achievement?

"We had a launch event at Merrill Lynch in New York a few years ago and Al Gore spoke. Afterwards, a couple of colleagues and myself ordered a bottle of champagne and the barman asked us what the occasion was. We explained to him about the meeting and its purpose and when he delivered the bottle he said: 'I'll pay for that.'

"There is a huge, untapped well of goodwill that accrues to people who do good work on climate change and I very much enjoy encountering that."

What advice do you have for UK low carbon managers and teams?

"Recognise that you are the first of the few; that you're part of a global movement, and be bold, assertive and enjoy being the pioneers who today may feel like lone oddballs but who tomorrow will be leading the army."

The Carbon Disclosure Project: www.cdproject.net/

Greening The Mean Machine

At the recent G8 summit in Japan, the hosts provided a range of new low emission vehicles for the assembled leaders to drive between sessions. The cars included electric, hybrid and hydrogen fuel cell prototypes developed by Japan’s top manufacturers.

Perhaps this encouraged Prime Minister Gordon Brown to suggest that the UK could make a significant reduction in emissions if electric or hybrid vehicles became a natural choice for the majority of the UK’s motorists, as early as 2020.

It was unlikely to impress an industry that views government policy with deepening scepticism, particularly since the proposed changes to Vehicle Excise Duty (VED) for 2009. The current 7 bands will be expanded to 13, with a new band over 255g/km and a “showroom” tax, amounting to £950 and £455 for subsequent years for those cars emitting more than 255g/km.

Controversially, the proposed changes were retrospective, including cars registered between 2001 and 2006. “Changes like this need to be announced a good few years in advance. The full details only became widely known after the budget. It could wipe millions of pounds off the value of older cars at a stroke,” says Paul Clarke, who runs Green Car Guide, one of the longest established websites of its kind.

Since 2002 government policy has also encouraged cleaner company cars. Employees must pay tax on their company cars depending on the list price plus any accessories, the emissions of the car, and its fuel type. From 2008 a new lower 10% band was introduced for cars with a CO2 value of 120g/km or less. In 2010-2011 the levels will be tightened by 5g of CO2.

Public sector priorities

Equally controversial were plans to amend the London Congestion Charge, charging £25 per day for high emission vehicles, a policy that has since been scrapped. But not all efforts to encourage cleaner vehicles in the capital have relied on sticks rather than carrots.

For example, Westminster City Council is slowly introducing electric charging points. “The first on-street charging points were introduced in Covent Garden in 2006 as a pilot project. In May this year 10 more on-street points were introduced, and there are 48 charging points in car parks,” says Project Manager Bridie Gunn.

Westminster offers a membership scheme with a £75 sign-up fee, which gives members a personal key to access the charge points at any time up to a total of four hours per day. Incentives include free parking, and a waiver on the Congestion Charge. At present, the scheme has signed up 100 members, made up of around 60 private individuals and 40 from companies, says Gunn. Among the corporate members Pret A Manger has shown particular interest in using small electric vehicles to make deliveries to its Central London outlets, she says.

The public sector is itself a fleet operator, and is therefore expected to demonstrate good practice. Among the most prominent is the Government Car and Dispatch Agency (GCDA) which provides chauffeur and car hire, a taxi-style booking service, protected security cars and specially trained VIP drivers. The Agency also provides fleet management and maintenance services to other public bodies, and secure mail services within Government and the wider public sector.

“We introduced an innovative scheme where those of our customers who used petrol engine cars could swap for a hybrid car,” says Chief Executive Roy Burke. “In 2004-5 the average CO2 tailpipe emissions of our car fleet was 232.03g/km. At the end of 2007/08 that figure was 144.96 g/km, a 37% reduction, thanks mainly to the significant increase in the number of hybrid vehicles on the fleet,” he says.

GCDA is one of many fleet operators looking at electric vehicles. “At the moment the limitations seem to be around range. Some of our customers are required to travel long distances and electric cars may not be able to accommodate our requirements. We continue to monitor the situation and have close contact with the leading manufacturers,” he says.

Advances in electric technology

Electric vehicles remain a rarity on our roads, and for many will evoke memories of milk floats or the ridiculed Sinclair C5, rather than something they might actually buy. There are signs that this could change with the emergence of specialist companies such as Liberty Electric Cars, which converts vehicles such as the Range Rover to electric powerplants with little, if any, sacrifice in performance according to the company. Tesla Motors in the US and Lightning Car Company in the UK plan to sell powerful electric two-seaters.

A notable company aiming to change minds about electric powered vehicles isn’t a car manufacturer at all. With a background in developing electrical motors stretching back more than 40 years, PML Flightlink hit the headlines in 2006 when it unveiled an electric powered Mini Cooper that easily outperformed all but the fastest road cars.

The company has developed powerful motors that are small enough to be mounted within the wheel itself, delivering power more directly and precisely than conventional drivetrains. In addition, “regenerative braking” is possible, using these motors to apply a retarding effect to the wheels and recharge the batteries. Swedish carmaker Volvo is working on ways of integrating the technology in future models, says Andrew Vallance, Director of Business Development at PML Flightlink.

“We've yet to see a serious hybrid vehicle that really makes the most of what technology is available. A hybrid using direct drive motors and a small internal combustion engine running as and when needed to charge the battery would give a range of four or five times what is available now, with no compromise on performance,” he says. The size and mounting of electric motors could be varied according to the vehicle type, says Vallance.

The technology may be within our grasp, but a “chicken or egg” conundrum looms. Manufacturers won’t invest in cars unless a market exists for them, but the public won’t choose cars they don’t know exist.

The largest carmakers are planning to test the market, says Paul Everett, Chief Executive of the Society of Motor Manufacturers and Traders (SMMT). Between 2010 and 2015 we can expect to see Toyota, Honda, Mercedes, Ford and GM add hybrid vehicles to their ranges, he suggests.

Even so, some difficulties remain. “You can’t persuade people to buy a low-carbon car. You can persuade them to buy a good car,” he says Paul Everett. An important step forward would be to make environmental performance easier to understand and compare. “Quoting figures for emissions in gm/km probably isn’t the best way. What we need is an easy way for people to understand that a model has the lowest emissions in its class. That could influence their decision to buy,” he says.

Key points:

• What impact will government policy have on the residual value of our vehicles?
• Are hybrids suitable for any of our requirements?
• Is the Board prepared to set an example in its choice of company cars?