Life Cycle Assessment for ESG

The second day of Sphera’s ESG Virtual Summit 2023 covered the theme of life cycle assessment (LCA) for ESG. Today’s program also included a special concurrent session on PCAF and its impact on the financial industry for attendees from financial services companies. Read on for key takeaways from today’s sessions.

Keynote: Building a Culture of Action-Oriented Decarbonization Programs Starts with Life Cycle Assessments (LCA)

Speakers Marc Binder, VP of global sustainability consulting at Sphera, and Paul Fanning, chemical engineer associate for the life cycle assessment and circular economy integration team at Eastman, kicked off the second day of the summit by discussing how LCA can help identify and deliver environmental savings across products’ value chains. Some notable takeaways from the session include:

• Companies in the chemical industry are setting ambitious sustainability goals that will require them to determine and address the environmental footprint of their product portfolios.
• If sustainability reporting is only done at the corporate level and not at the product level, then there will be gaps in reporting, and companies won’t be making enough progress to meet the decarbonization targets needed to reach net zero.
• With the help of an LCA automation solution, companies can calculate LCAs at scale.

Panel: How Leading Companies Are Using LCA Data to Drive ESG Performance

Organizations are using LCA and technology to pinpoint nodes in their supply chain where improvement can have a material effect on their ESG performance. A panel of experts discussed how LCAs are driving performance. Some key takeaways are:

• LCA can be a useful tool for businesses in several key areas: Deciding which products to go to market with, measuring the value of supplier engagement, optimizing operational performance and supporting marketing efforts.
• LCA is not just a tool for looking at the past but can be a tool that helps a company optimize processes going forward.
• Standards help improve comparability of data between companies and provide alignment in how LCAs are calculated and documented.

Moderator: Mark Evans, director of business development – sustainability consulting at Sphera

Panelists: Alessandro Pistillo, director of digital strategic projects at BASF, and Martijn Gipmans, director of business development at Sphera

How to Create the Business Case for LCA Automation

LCA is becoming a critical technology for helping businesses meet ambitious net-zero targets and corporate GHG reporting requirements. In this session, a panel of experts discussed how LCA automation technology can support your organization’s ESG ambitions. What we learned:

• Companies are under pressure to report their sustainability performance, but many lack the tools to calculate their carbon footprint and make progress on climate goals.
• Companies today need data to quantify their carbon footprint and reduce emissions. Ultimately, having better data will aid in company decision-making and help them prioritize sustainability efforts.
• LCA automation can help companies meet multiple needs, including Scope 3 emissions calculations, reporting product carbon footprint information to customers and analyzing supply chain emissions hotspots.

Moderator: Sebastian Schulz, solution manager for product sustainability at Sphera

Panelists: Nick Abbatiello, senior distinguished engineer for the experience design group at Dell, and Dr. Constantin Herrmann, director of sustainability consulting, manufacturing and electronics at Sphera

Panel: PCAF and Its Impact on the Financial Industry—How Financial Leaders Can Join the Fight Against Climate Change

In this concurrent session for the financial industry, Donald Reed, managing director at PwC, Jake Shirmer, principal, sustainability at Blackstone, and Sharlene Key, director of product management at Sphera, discussed how the Greenhouse Gas (GHG) Protocol and Partnership for Carbon Accounting Financials (PCAF) help companies measure and disclose the GHG emissions associated with their lending and investment activities. They also looked at how software can help organizations measure and manage their portfolio’s carbon footprint, assess climate-related risks, integrate a climate strategy into their organization and meet ESG reporting requirements. Some notable takeaways from the discussion are:

• Financed emissions account for the majority of a financial institution’s carbon footprint, and financial institutions must focus on them in order to decarbonize.
• The GHG Protocol and PCAF allow for greater comparability for financed emissions inventories. However, these frameworks provide different capabilities and the benefits and are constantly evolving. For example, PCAF provides more granular guidance for financed emissions than the GHG Protocol.
• Quantifying financed emissions is no easy feat—especially if data quality is a challenge. But that shouldn’t deter you. Get started now with the data you have and determine what your strategy is.

Learn More

Interested in learning more about LCAs? Read this article for more on how LCA automation is becoming business critical. Visit the LCA Automation page to learn more about how the solution helps give companies a clearer picture of their entire product portfolio’s footprint.

Interested in learning more about sustainable finance or PCAF? Read this article for more insights on PCAF and its impact on the financial industry. You can also learn more about financed emissions in our recent podcast featuring Donald Reed from PwC. Additionally, this article provides an overview of the EU Sustainable Finance Disclosure Regulation (SFDR).