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  • Apr 5, 2022

  • 7 min read

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How do we become a carbon neutral business?

In 2019 the UK became the first major economy in the world to pass laws to end its contribution to global warming by 2050.

This commitment means the UK is required to bring all greenhouse gas emissions to net zero by 2050. A vital first step toward tackling the climate crisis and reducing our contribution to global warming.

Reaching net zero is going to require a joined-up approach, with everyone playing their part. Businesses can play their part by starting their own journey to becoming carbon neutral.

What's the difference between carbon neutral and net zero?

Carbon neutral and net zero are sometimes used interchangeably, but there’s a difference between their meaning.

Carbon neutral is a policy of not increasing carbon emissions and of achieving carbon reduction through offsets.

Net zero carbon means making changes to reduce carbon emissions to the lowest amount, and removing the left over emissions through ‘carbon sequestration’ (capturing and storing carbon from the atmosphere).

What does being a carbon neutral company mean?

Becoming carbon neutral is a process a business can go through to remove the same amount of carbon from the atmosphere that they produce.

The first step is to calculate your carbon footprint, which is the total amount of greenhouse gases - including carbon dioxide and methane - generated by the business.

Your carbon footprint is made up of scope 1, 2 & 3 emissions. Scope 1 & 2 emissions are directly related to business activities (like offices, business travel and the energy the company uses) and scope 3 emissions are indirectly related to the business activities (like employee commuting and waste disposal).

Once you know how big your carbon footprint is, you can work to reduce and remove those emissions from the atmosphere.

Using green benefits is a great way to reduce your company’s carbon emissions. You can save over 1.5 tonnes of CO2 per employee when they switch from a fuel car to an electric car through our salary sacrifice scheme. Joining is easy and there’s no cost for employers.


Reducing your company’s carbon footprint

Once you understand where your business is producing emissions, you can actively reduce them, and then offset what you can’t reduce as a last resort through activities that take carbon back out of the environment

One way to reduce your emissions could be switching your petrol or diesel fleet to an electric fleet to reduce your company vehicle tailpipe emissions to zero, or giving your staff access to electric cars through a salary sacrifice scheme to reduce their own personal carbon emissions.

Wightlink, the award-winning ferry operator, linking the Isle of Wight with Hampshire, joined our electric car salary sacrifice scheme to show its customers that it takes its commitment to reduce its company-wide emissions seriously.

Keith Greenfield, CEO, said: “It's important for our customers to know that we're very environmentally conscious and we're doing everything we can to decarbonise. I really don’t think hybrid cars are going to make much of a contribution to that effort, I think it has to be electric.”

Offsetting your company’s carbon emissions

Offsetting your carbon emissions involves paying another company to put initiatives in place for you to remove carbon from the atmosphere. Some offsetting projects plant trees to absorb the same amount of CO2 that you emit, or support projects that give communities in developing countries alternative fuels rather than burning wood for cooking and sterilising water.

You can also have carbon neutral projects, events and products. You need to know your carbon footprint for each, reduce the related emissions, and offset the rest.

Ideally, companies should use offsetting as a last resort, as it isn’t a substitute for reducing emissions.

What are scope 1, 2 & 3 emissions?

Scope 1, 2 & 3 emissions are the different ways that your business produces emissions.

It’s mandatory for publicly listed companies to report on scope 1 & 2 emissions while reporting on scope 3 is voluntary. The UK Government encourages all businesses to report their emissions. Companies that report on all three can get a clearer picture of the emissions across their value chain, identify opportunities for improvement and strengthen their relationship with stakeholders, giving them an advantage over their competitors.

  • • Scope 1 emissions are from direct activities of the business, including company facilities and company vehicles.
  • • Scope 2 are indirect emissions from the energy used by the company.
  • • Scope 3 are indirect emissions linked to the operations of the company. This includes business travel, employee commuting, waste disposal, purchase, transportation and distribution of goods and services.

Scope 3 emissions often represent the biggest greenhouse gas impact on the environment, and staff commutes can contribute to high scope 3 emissions.

When Stride Treglown, an award winning architects practice, started their journey to carbon neutrality, they found that 88% of their emissions were from scope 3 staff travel emissions. This inspired them to join our electric car salary sacrifice scheme and incentivise their team to switch to driving electric.

John Wright, Director, said: “We’ve been on a long term sustainability journey, both through the work we design and in the way we operate as a business. There are two big impact areas - our offices and our transport. Reducing these emissions is crucial to maintaining our carbon neutrality. We became a B Corp around the time that we brought in the electric car salary sacrifice scheme, which aligns well as it supports our people and our environmental impact.”

How difficult is it for a business to become carbon neutral?

Once you’ve made the commitment to become a carbon neutral company, the work involves understanding your emissions, reducing them, offsetting them and monitoring them on an ongoing basis. Check out our guide the explains 5 steps to becoming carbon neutral.

It’s not possible to reduce emissions all the way down to zero, so carbon offsetting is something that most companies will need to do to reach carbon neutral status. The more you can reduce your emissions, the less you’ll have to pay in carbon offsetting. That’s why free green schemes like our electric car salary sacrifice scheme are a win-win from an employee benefits perspective and from an environmental perspective.

Our electric car salary sacrifice is a brilliant way to reduce your carbon emissions. It gives your team access to a brand new electric car, paid for through their gross salary. They can make great savings on Income Tax and National Insurance and their one monthly payment covers everything they need to hit the road - car, charger, MOT, tyres, maintenance, repairs. The lot. Find out how.