When Carbon Measures launched last October, a dividing line appeared to be drawn: Climate nonprofits on one side, heavy emitters on the other.
The initiative, which seeks to make products rather than companies the focus of emissions accounting, was labeled impractical by some critics. Others went further, calling it a distraction from the current system that was designed to benefit its emissions-intensive backers.
At the time, the other side was populated almost entirely by the 19 founding members of the initiative, which include ExxonMobil, BASF, Nucor, Mitsubishi Heavy Industries and Blackrock’s Global Infrastructure Partners.
In the months that have followed, that line has blurred. Last month, the initiative announced seven new members, including firsts from the automotive sector (Toyota) and banking (Bank of America). Earlier in the year, sustainability professionals from Microsoft and climate nonprofit RMI joined the organization’s advisory panel. (Advisors serve in a personal capacity.) Another nonprofit, Resources for the Future (RFF), joined McKinsey in signing on as a “knowledge partner.”
Complement, not replace
One reason for the initial division was links between Carbon Measures and E-liabilities, a framework that rejects Scope 3 in favor of measuring direct emissions and allocating a portion to customers. The approach was co-developed by Karthik Ramanna, a University of Oxford financial accounting expert, prominent critic of Scope 3 accounting — and co-chair of the Carbon Measures advisory panel.
But new arrivals who spoke with Trellis played down the conflict with existing standards. The Greenhouse Gas (GHG) Protocol and Science Based Targets initiative continue to be “foundational” to carbon accounting, said RMI CEO Jon Creyts, an advisory panel member, and RMI itself is actively involved in both those organizations. “We see Carbon Measures as a potential complement,” he said.
The results of the initiative must be “interoperable” with existing standards, agreed Carbon Measures CEO Amy Brachio. “We’re not looking to create another disclosure framework or displace the regulatory reporting regimes already in place in many different markets,” she told Trellis.
Overlapping thinking
The initiative is interesting to RFF because the organization works on the connection between international trade, global decarbonization and border policies such as the European Union’s Carbon Border Adjustment Mechanism. For these kind of policies to be effective, said RFF CEO Billy Pizer, governments need reliable data on carbon footprints at the product level — the kind of disclosure Carbon Measures is designed to incentivize.
For other new arrivals there is a business connection. Anew Climate, which provides customers with low-carbon fuels, carbon credits and related products, was announced as a member last month. The company’s customers are more interested in product footprints than company-level targets, said CEO Angela Schwarz. “Our belief is having that level of transparency at a product level will drive demand more so than saying Scope 1, 2 and 3,” she added.
Despite the broadening of interest, many skeptics remain unconvinced of the intent of the initiative’s members and its likely impact. Founding member ExxonMobil refuses to set Scope 3 targets and has said the GHG Protocol has “inherent flaws,” noted Thomas Day at the nonprofit NewClimate Institute in a recent blog post: If initiatives such as “Carbon Measures are given the space to challenge widely accepted approaches for identifying emissions responsibility, discussions on concrete measures to reduce emissions may be pushed further down the line.”