Reducing Business Travel Emissions Is a Journey

Most companies begin their GHG emissions reduction efforts with a focus on Scope 1 and Scope 2, which are defined in order as 1) direct emissions from owned or controlled sources and 2) indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by the reporting company, according to UK-based Carbon Trust. Scope 3 includes all other indirect emissions that occur in a company’s value chain—including business travel. 

Companies with a large percentage of emissions tied to business travel—like the consulting and professional services companies cited above—might prioritize Scope 3 emissions reductions over other targets or run that priority simultaneously. One reason is that Scope 1 and Scope 2 emissions force businesses to look at their internal practices and not only the practices of their supply chains when it comes to reduction. 

International law firm Hogan Lovells committed to science-based targets initiative in December 2020. Global travel manager David McDonald, who is just beginning the firm’s journey toward sustainable business travel, pointed out it was important to get your own house in order first before reaching out to suppliers to contribute to the cause. 

“We have started crafting a series of questions and requirements that we would add into RFPs and/or contracts to wrap rigor around some of our expectations,” he said. But in terms of concrete conversations with suppliers, McDonald isn’t there yet. “The one thing I find very important—and all of us at the firm agree—if we go to go out to our vendors and expect them to deliver against responsible business goals, we should know what we are doing ourselves and live in the same spirit of what we expect from suppliers. Will we be fully mature? Doubtful. But we need to know how we will measure and manage.” 

This attitude was quite different from one registered by a leading U.S.-based buyer who spoke with BTN at an advisory meeting in mid-2019. She indicated her sustainable business travel strategy would rely almost totally on pushing suppliers to pass along their GHG emissions reduction bona fides and to deliver more sustainable services. She characterized the process as a “checkbox” exercise that would enable her CEO to create talking points for investor meetings. Plenty of companies are still at that point, 11 percent according to BTN’s survey (more than 20 percent who say they are tasked with reducing travel don’t ask for any supplier information). That said, her company at the time had no sustainability-focused leadership so any efforts towards establishing sustainable travel practices were hers alone to manage—perhaps in cooperation with her travel management company if that assistance could be prioritized in the budget.  

In canvassing several travel buyers for this issue, it became clear that executive-level commitment to mitigating climate change was the foundation for an effective sustainable business travel strategy. Collaboration between business travel and a sustainability leader who would help define strategy and contribute to decision-making around effective projects to pursue provided travel program managers with the scaffolding required to make dramatic changes to their programs. That said, nearly half of travel buyers who participated in the BTN survey had not been formally tasked with either assessing or mitigating carbon emissions associated with business travel.

Still, 71 percent of buyers said they were personally concerned about their company’s carbon footprint from travel. Several buyers in this category said they were doing what they could to mitigate that footprint—even without leadership support.

Demand management will be a key pillar for travel programs moving forward, as confirmed by several surveys BTN has conducted over the past year, and the recent sustainability survey was no exception. Nearly three-quarters of buyers said they would shift some portion of business travel to virtual meetings—with or without a mandate to reduce carbon footprint. Others working solo on carbon reduction had more specific carbon mitigation efforts on the books. A procurement manager at a U.S.-based international law firm, who previously worked at an alternative fuel company, created a rail program for travel within the Northeast Corridor to divert travelers from emissions-intensive short-haul flights “and frankly give them more convenient options,” he said. These types of one-off projects count toward total emissions reductions, so when opportunities arise, travel buyers shouldn’t be afraid to take them, even if they aren’t formally credited as a sustainability move.

Sometimes, however, it pays to think bigger, even without a direct mandate to do so. FLSmidth global travel manager Merete Minnet is taking this approach. While the Denmark-based multinational engineering company has signed on to science-based targets to reduce GHG emissions, business travel isn’t anywhere on the radar for those efforts.   

“Ninety-six percent of our emissions come from our customers,” she said of the company’s work providing solutions to cement and mining plants, which are particularly emissions intense industries. “So getting to zero emissions will come from providing better solutions to customers and Scope 3 becomes a much lower priority. But I’m still working on it and looking into it.” 

The reason, she said, is because she wants to be prepared. Given that her company has pledged emissions reductions, she believes leadership will come knocking eventually for her to contribute to the cause. “One day they will come to me and say, ‘We need zero emissions when we fly.’ I need to be able to say, ‘Yeah, we can do that if we do this, this and this. And it will cost this. So how do you want to do it?’” 

Minnet already has had a handful of travelers come to her to ask about offsetting carbon emissions for flights or about the ability to take a direct flight instead of a connecting one to save on emissions. And though the company still isn’t traveling much because of Covid-19 risks, she’s aware her current key performance indicators are not aligned to support sustainable travel options.

“The direct flight from Copenhagen to New York is 15,000 kroner. But with the stopover in Germany or the UK, it’s only 5,000 kroner. If the travel program is only measured on savings, then I won’t be able to meet those targets.” 

Carbon consumption is featured in the company’s Egencia booking tool, so she knows she will need to respond to inquiries from travelers when the company begins traveling again in earnest. She and her Egencia account managers are modeling different scenarios to understand different options—including the option to disable that feature until FLSmidth is ready.

“We’re looking at our top city pairs out of Denmark and other countries and looking at the difference in both price and carbon emissions on direct flights and the stopover options. Currently, our policy is to take the stopover if it’s less than a four-hour difference. I want to know the cost and the emissions savings to understand what would happen if we changed that policy. Then, I could send that model to management. Nothing is free.”  

She’s also looking at hotel partners to understand if any of them have sustainability initiatives. She said it’s not likely because FLSmidth locations tend to be outside of city centers and their top hotels aren’t always the big brands. “Those are the hotels that will have sustainable options first, but those aren’t generally the ones available in our locations. Do I put travelers in a hotel farther away because it’s sustainable and then make them drive or take Uber, adding a commute? Does it have to be Uber Green?” she asked. The calculus gets complicated. This may be one reason sustainable travel strategy hasn't filtered through the majority of travel programs into hard-and-fast policy changes.

She has also considered what happens if she takes certain options out of the booking tool entirely—non-sustainable hotels or flights that are less sustainable than the same route on another airline. “Right now, I have nearly 100 percent compliance on flights in my booking tool. I don’t want to make changes that would sacrifice that,” she said. Her TMC partner is working with her to understand these implications and create sustainability scenarios that are, well, sustainable.