Humanity has an urgent need to fight climate change, and businesses can play a key role in doing so. But we recognize that, in many businesses, resources are often allocated according to short-term, bottom-line pressures. We thus wanted to figure out a way to help executives quantify the financial benefits of reducing their firm’s greenhouse gas (GHG) emissions.
How to Quantify Sustainability’s Impact on Your Bottom Line
A case study of the Brazilian beef industry.
September 13, 2017, Updated October 13, 2017
Summary.
Humanity has an urgent need to fight climate change, and businesses can play a key role in doing so. But in many businesses, resources are allocated according to short-term, bottom-line pressures. Thus executives need a way to quantify the financial benefits of reducing their firm’s greenhouse gas emissions. A case study of Brazil’s beef industry shows how sustainable and deforestation-free practices can create significant financial benefits for all players in the value chain — benefits that can be measured and translated into dollars saved and earned. Specifically, the analysis found that the net benefits to ranchers ranged from 12% to 23% of revenues, the benefits to slaughterhouses were 0.01% to 0.1% of revenues, and the benefits to retailers were 0.01% to 0.7% of revenues. The case study demonstrates that measuring the value of sustainable business can be done, and that sustainable business itself can be cost-effective.