Manufacturers Aren't the Only Firms Affected By Carbon Emission Laws
Is Your Firm a Carbon Junkie? (Are You?)
Suppose there was a 12-step program for consultancies. This program would help consulting firms wean themselves off of decades of bad social and environmental policy.
In my own case, if I attended one of these meetings, it might have gone something like this:
Brian: “Hi, I’m Brian. I am a consultant and for 12 years I was a carbon pig. It’s been almost 4 weeks since I last boarded a jet.”
Group: “Hi Brian"
Moderator: “Welcome Brian. Please, tell us why you feel this way."
Brian: “Well, for most of my early career, I worked really close to my home, shared a commute with my brother and drove a fuel efficient car. For one client, I stayed at the family ranch to minimize my commute. In fact, I never flew to a client for the first seven years of my career except for one interesting week in Jackson, Mississippi. Then, the management of our firm decided that my talents would be better utilized at intergalactic world headquarters. Once I got sent to Chicago, I got hooked on flying."
Moderator: “Tell us about your addiction”
Brian: “It just came on so sudden. I went from making one or two flights a year to seven or eight a week. Before I realized it, I was spending over $250,000 per year, every year, just on airline tickets alone. I kept this pace up for 12 straight years and in my last year alone I bagged 48 international roundtrips."
Moderator: “What made you realize this was wrong?"
Brian: “The travel was beginning to supplant my everyday life. American Airlines special services agents were seeing more of me than my own family. I realized that I had leisure clothes in my closet that I was never wearing because I was always flying to or from clients but spending no time at home. When I saw that I was about to cross the 3,000,000 mile mark for American Airlines, I knew I needed to change.”
Moderator: “How did that go?”
Brian: “It was tough. I didn't realize how difficult it would be to not go to Midway or O'Hare airport at least once a week. I had withdrawal issues. I even missed the smell of that sickly smelling de-icing fluid that seeps through the ground by Terminal 1 at O'Hare. I missed the smell of burnt kerosene on the tarmac. But most importantly, I miss those hot steaming towels they hand out in first class.
Yes, I know I had an addiction to flying. I flew because I thought it was the right thing to do to advance my career and to serve clients. And while I thought I was doing the right thing for me professionally and my family economically, I now see that I and many others like me wasted a whole lot of fossil fuel.”
Moderator: “This is good Brian. You've moved past the stages of denial and acceptance. What are you doing to make your consulting business today less of a carbon pig.”
Brian: “Well, for starters, I have embraced WebEx, DHL, FreeConferenceCall.com, email and Skype as my new higher powers. With these tools alone, I have been able to eliminate a significant amount of my travel. I'm proud to say that I'm now down to just one or two flights per month.”
Group: “Yeah”
Moderator: “That’s great Brian. What else are you doing?”
Brian: “I've decided to work full-time from my home office. Commuting simply wastes motor fuel and eats up a lot of valuable time. An office, I have come to realize, seems to be more about prestige and ego - not around saving scarce natural resources. As to flying, I almost never take trips of a purely promotional nature anymore. I dovetail business development activities on the backs of other client related flights to minimize wasteful trips and the high SG&A costs they generate.”
Moderator: “That's great Brian but what else are you going to do?"
Brian: “Well I'm really worried about some of my friends. I have a number of colleagues who are also consultants or bloggers who still aspire for the bad habits of yesteryear. They still brag about free first-class upgrades, how brutal their six flights this week were, and how petty the airlines have become. I just don't think my colleagues have developed a social conscience just yet. They still can't decide the difference between “meetings” and “meetings that count”. And until they do, I fear for their non-carbon-based soul. One of my colleagues has a carbon Jones really bad. He's still flying to clients weekly as well as to numerous family events around the U.S. and Europe. We may need to stage an intervention for him.”
Consulting firms have had to scale back their travel and entertainment expenses in recent years because of a number of factors:
- closer scrutiny that clients put on them for their travel expenses
- outside investors in the these consultancies want less money spent on travel and entertainment and more money returned to them in the form of shareholder dividends
- rising travel costs
- pressure to make their businesses more family friendly
The current fuel and airline pricing environment will also drive more curtailments by consultancies. But, these changes are an economic reaction and not one based on social policy or an awareness of a new regulatory requirement: Accounting for one’s carbon footprint.
That will change and change quickly as businesses will soon be required to report their carbon consumption.
Consulting firms may be in for a shock when they realize how much carbon dioxide their firms produce via:
· worker commuting activities to the office
· commuting to client sites
· pre-sales travel
· company meetings
· other air, rental car and personal automobile travel
Smart consultancies will get ahead of this issue to understand what their current consumption levels are and what options remain for them to rein in marginal activity that is contributing to their carbon footprint.
Reconciling new carbon reduction initiatives with newer personnel policies will be a tough balancing act for consulting firms. In recent years, firms have changed their out-of-town work policies to permit employees more frequent trips home. When these policies were crafted, fuel was cheap and carbon consumption was a non-issue for businesses. Neither of those assumptions is still true today.
Consultancies would be wise to reevaluate their workforce satisfaction and workforce travel policies. If a company must reduce its carbon footprint then can it afford to fly workers home every week? Does this mean that firms will staff a significantly higher percentage of projects with local personnel? How will clients react to the unavailability of critical subject matter experts because their presence on a project will have an adverse impact on carbon emissions?
Questions like the above will become fascinating fodder for the rank-and-file as well as the executive management of service firms. Technology will go a long way to close some of the gaps; however, tough decisions will need to be made as to whose priorities will take precedence: clients, shareholders, environmentalists or the employees? If I had to bet, the priority would fall in the order I just listed them.
Thoughts?
