THOUGHT PIECE the carling team

Sustainability – How Are We Doing So Far? Part 1

Part 1 – Definitions and acronyms

We last reviewed this subject almost three years ago looking primarily at what breweries were doing to reduce their carbon footprints. The scope of the subject is not getting any smaller. Work is gaining momentum with the eye firmly on the bottom line as energy costs are a lot more than they were in 2020. Solar panels and wind turbines are now a lot more efficient and indeed cheaper than they were and the capital grants system has progressed so folk know far better when to trigger ‘green’ investment. Going ‘green’ of course is not only about CO2 emissions, but minimising pollution, protecting the environment and promoting reuse and recycling; thus embracing all aspects of sustainability. Remember that we must also remove carbon dioxide from the atmosphere and not simply stop adding to it.

Our renewable choices; wind, sun and nuclear. Will Hinkley Point C be ready for 2026? What about reliable tides and geothermal?

Are we now ready to accept that global warming is real?

We have all seen the wild fires raging in the Greek islands and Hawaii, temperatures in the mid fifties in Death Valley followed by half the annual rainfall (admittedly not a lot) in one afternoon courtesy of Storm Hilary. Disastrous floods in China’s capital city and mud slides in South Korea. In midwinter Antarctica, an area of sea ice the size of Argentina is just not there this year.

France has logged its hottest day ever at an uncomfortable 44.4oC. Average sea temperatures are warmer than ever and more alarming is a prediction that the Gulf Stream will stutter as early as 2025 if the buildup of cold Greenland fresh glacial melt water prevents warmer water travelling northwards to keep us warm and wet in winter. Some boffins predict there will be no glaciers at all by the end of the century. Back home the wettest UK July since the year dot is just another manifestation. Perhaps more and more of us are now thinking there might be something in this global warming malarkey and might be more willing to help do something about it.

Does such rhetoric about an approaching era of ‘global boiling’ as described by the UN Secretary General really help or do we feel there is so little we can do to help that we jet off to the Algarve anyway? We see incremental targets slipping as there was little scientific basis behind them when they were first set. Yet the overall target of net zero by 2050 is enshrined in UK law and to my mind the only way we are going to get there is to mobilise the best of emerging technology and do not spare the investment in research.

Before we look at how our industry is moving forward, it might be useful to define some terms which we see creeping into press releases. What is scope 1, scope 2 and scope 3? What does net zero and carbon neutral actually mean?

Diagram from the Malt Doctor explaining scopes 1, 2 and 3. Courtesy Institute of Brewing and Distilling

Net zero is a way of balancing carbon emitted against carbon removed so that there is no need for any carbon off-setting. Carbon neutrality does include off-setting but it should surely be the last choice? We should not be using the good work of others to make our own operations look better however much we are willing to pay. Examples of operational efficiency to reach net zero would include making fertilisers from ‘green’ ammonia rather than nitric acid and breeding new malting barley varieties like KWS Curtis with increased yield from the field and enhanced extract for the brewer and distiller.

More diagrams from the Malt Doctor. Top – malt delivered to the brewery, note 65% is upstream as shown in the
lower chart.

The SBTi (Science Based Target initiative) aims to formulate plans based on the best guess of carbon imbalance calculated from any number of models currently available. To date some 6,000 companies have defined a path to net zero across their entire supply chain. The greenhouse gas protocol divides carbon up into operational usage and the supply chain and scope 1 is what you produce yourself and that is almost exclusively fuel usage and emissions from the transport fleet if operated directly. Scope 2 is electricity, heat or steam that is purchased while scope 3 includes all other activities in goods and services brought in both upstream and downstream. Do not forget to include employees commuting to work, business travel as well as waste generated and the fate of the product at the end of its life. Although there is always a good deal of uncertainty in calculating group three, if you merely quote scope one you are missing out on up to 90% of the true carbon figure!

Companies have had CSR or Corporate Social Responsibility aims for a while. Yet another TLA or Three Letter Acronym for them is ESG or Environment, Social and (Corporate) Governance. Certification is via a third party verification system used to show how precisely your company has completed key sustainability initiatives to become a more sustainable business. Companies that adopt ESG principles will define a vision, mission, strategy, tactics and values, then go on to consider, measure, and report these aspects of the business to stake holders. We have seen the approach by SBTi, LEED for sustainable buildings dates from 1993 while ISO14001 is an all purpose standard applicable to any business. The Green Business Bureau allows you to apply totally on line which saves the reams of documentation associated with ISO14001. The Global Reporting Initiative aims to impose a common language for reporting across the globe while the Sustainability Accounting Standards Board has a list of 77 standards to be applied and of course B Corp.

We see more and more companies boasting of their B Corp status. B Corp is short for ‘Benefit Corporation’. They are for-profit companies that place social and environmental goals on an equal footing with financial objectives. There are some 6000 worldwide and 1300 in the UK. B Corp certification is awarded by the non-profit organisation B Lab to businesses that meet specific standards of social and environmental performance, accountability and transparency. B Corp companies commit to using their business as a force for good, considering the impact of their decisions on their employees, communities and the environment. B Lab will not even look at companies involved in fossil fuels, Brazilian agribusinesses, bottled water, prisons, casinos, cannabis, zoos, abattoirs, block chain verified digital assets (whatever they are), Swiss banks and off shore businesses in general all the way to breast milk substitute, jewellery and pesticide makers.

You could argue that the B Lab list is a bit subjective but it does raise the issue of company PR departments and their laudable ESG aspirations but who should they approach to get their certification? Each body must necessarily have its own views about the emphasis that should be given to perhaps 77 aspects (SASB above) and then how zealously each could be applied within the company?

Diversity is all very well but remember the pickle that Anheuser Busch in the States got into when it sent a few cans of Bud Light to TikTok star Dylan Mulvaney, a trans rights activist and performer. Anheuser Busch totally misjudged the mood of middle America and the fuss on social media sparked an uproar among conservatives who boycotted the product. Further boycotts of Bud Light have involved the LGBTQ+ community, who felt let down by the brand’s rigorous attempts to distance itself from Mulvaney and the original promotion. The backlash led to Bud Light being displaced as America’s best-selling beer brand to be replaced by Constellation’s Modelo Especial. Sales are down around 25% and show no signs of rebuilding with other A-B brands suffering as well. So beware of pandering to the ESG (environmental, social, and governance) puppeteers, who are scoring enterprises on ‘social responsibility’ and have the power to downgrade those that fail to dance to their tune, so says Ina Verstl writing for Brauwelt. So who checks up on the checkers?

Of course, Robinsons at Stockport are well aware of all this as it is the first UK brewery to start training all their staff on Carbon Literacy which entails ‘an awareness of the carbon dioxide costs and impacts of everyday activities, and the ability and motivation to reduce emissions, on an individual, community and organisational basis.’ Two MDs and 40 HQ folk so far are spreading the word towards its net zero target of 2040. Carbon Literacy aims to become embedded in every workforce, which involves breaking out of the ‘eco bubble’ of ‘green’ business and making this simply ‘business’.

Politicians will gather at COP 28 in Dubai later this year but the scientific consensus remains unchanged we must reduce our carbon emissions.

Next time we shall look at some brewery and maltings success stories.