Episode 219
August 27, 2021

Project Gigaton: The SMB and DTC Impacts of Climate Accountability

In this episode, we welcome Gaida and Holly of SustainaBase as we cover Walmart’s Project Gigaton, a global initiative to encourage vendors to measure their Scope 1 and Scope 2 impacts of sustainability. We cover the impact of Gigaton, where companies can get started, and how we as individuals can help be a part of the change. Listen now!

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this episode sponsored by

Accounting Platforms for Business Data that have Climate Impact

  • SustainaBase is a software program that helps manage the carbon footprint of a company, akin to an accounting platform. SuistainaBase tracks carbon emissions, as well as water and waste metrics, taking data and science calculations to organizations to create meaningful actions.
  • “Sustainability is important and it's something that we should be tracking like the way we track dollars. We should be checking to see if we're really making the reductions that we want to be making and the impacts that we want to be reducing.” -Gaida
  • “Project Gigaton is a Walmart program, it's a big audacious program with a very meaningful goal. They’re working to avoid a billion metric tons of greenhouse gasses from their supply chain by the year 2030.” -Holly 
  • Smaller companies may see some challenges in the sustainability approach but starting somewhere and starting small helps add to the change of creating meaningful actions. Starting these efforts from the beginning can be easier than starting them mid way with a larger company. 
  • Carbon accounting can start anywhere but it has to start somewhere. One person isn't going to make a change but a community, the government, and a company working together will. 
  • Ways decision makers can start small is by building opportunities for change within their organization, building community efforts, and sourcing companies that are working towards sustainability. 

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Brian: [00:02:11] Hello and welcome to Future Commerce, the podcast about next generation commerce. I'm Brian.

Phillip: [00:02:16] I'm Phillip. And goodness, that was the exuberant intro Brian.

Brian: [00:02:19] Yes.

Phillip: [00:02:21] I'm equally as excited as you are today. We have two of the most brilliant minds that I have in my local vicinity here in South Florida, and they're focused on an area that we should cover more often, but we just don't have the expertise ourselves. And here to lend a little more insight and help us understand a little bit more around the area of sustainability and consumer products, we have folks from SustainaBase. Gaida Zirkelbach is Founder and CEO of SustainaBase, and Holly Lichtenfeld, who is Chief Growth Officer just coming to share some knowledge with us here today. Welcome, Gaida. Welcome, Holly.

Gaida: [00:02:51] Hi. Thanks for having us.

Holly: [00:02:53] Yes, hello.

Phillip: [00:02:54] Yeah, glad to have you. We started having this conversation around there's so many things to talk about in the world of sustainability. It's its own conversation, especially around consumer goods, as we're in this direct to consumer era and as all these businesses are trying to become more omnichannel. And the conversation that we had been having here between SustainaBase and Future Commerce was how does this impact brands directly and what size of brands are actually making meaningful changes or contributions in the space? And you're like, "Well, that's what SustainaBase does. We have a platform that does that." So Gaida, could you tell us a little bit about SustainaBase and just kind of set us up for our conversation today?

Gaida: [00:03:31] Sure. Yeah. So, yeah, we all know that we're in the area where measuring your carbon and your ESG metrics is necessary. And that's what we do. We have software that will manage and help you report easily everything from your carbon emissions to your water waste and other metrics. And it's basically taking all of the complicated, messy data, all of the science and calculations that have to happen, and showing that to organizations in a way that provides them with insights, so that they can take meaningful action from that.

Brian: [00:04:08] What I love about this is that, I think typically we see a lot of companies try to use different organizations to try and prove to their customers that they're doing a good job with sustainability. But it sounds like the way that companies use SustainaBase is that they're actually using this as a way to improve who they are and actually make a meaningful impact on the way that they think about and accomplish becoming more sustainable. Is that an accurate description?

Gaida: [00:04:43] Yes. Yes. It's a data driven. And it's it's taking on taking sustainability. And what I've always wanted to do and I'm so happy that we're doing it well now, is having it be tracked the way that the world tracks dollars. So you have an accounting system. Maybe you have something like a Quickbooks or a bigger program, and you're taking all this data in. You're looking at it in different ways. You're sending these reports. And from that, you make decisions. So sustainability hasn't really had that or carbon accounting hasn't really had that. And it's the time to do it. It's such an important issue. It's something that we should be tracking the way we track dollars. It's something that we should have KPIs for and that we should be checking and looking to see if we're really making the reductions that we want to be making and the impacts and reducing the impacts that we want to be reducing.

Phillip: [00:05:37] So it's accounting software at its simplest, I mean, is that a gross oversimplification?

Gaida: [00:05:44] Yes. Sorry. No, I didn't mean yes, it's an oversimplification. {laughter}

Phillip: [00:05:51] I'm not above being wrong.

Gaida: [00:05:54] I meant that it is like an accounting software, except that ESG metrics, there's so much more to them. Right? There is a bigger human component. And so although we're tracking hard data and we're doing the difficult calculations, it's what the organizations are doing with that, next. That's very different and has such a broad scope and applicability to it that that is different. Yeah, but you know the reason we started this is it seems like a lot of organizations, are going to need to measure this and they're going to have to report on it. It's coming. And they're probably doing it already because they have a vendor or they have a customer, they have other pressures to do it, maybe an investor. And so we noticed that even large organizations sometimes are spending a lot of time with the difficult data collection from all different sources from all over the world, and then making sure that they have protocol compliant science and calculations behind the scenes to convert it to carbon. We wanted to make sure that we took all those hard things away, like we take care of that. Let us take care of that messy data, let us do these calculations, and make sure it's protocol compliant, make sure you can track what you need to track even down your supply chain, upstream and downstream. And then, you can log in and you can see what's happening and you can then use that valuable time that these people have in these organizations to create strategies, to create programs, and to really make a difference in the organization and add value.

Brian: [00:07:33] So are you sourcing the data? Are you the one that's actually collecting the data?

Gaida: [00:07:39] Yes, and so there are all kinds of creative ways that I won't get into to bore you and ways that we can get data from all kinds of different systems, many of which organizations already have. So that they can then turn that data into carbon or water or waste related metrics.

Brian: [00:07:58] Got it.

Phillip: [00:07:59] Hmm. This isn't just an enterprise thing. I think that's what I found so fascinating here is, you know, my sense was, hey, maybe it's just big global CPGs or giant global corporations that have stated sustainability goals, climate, carbon goals that they're trying to reach. And this is one step on the way to do it, but it seems like it might be much more pervasive. Tell us a little bit about Project Gigaton, which, by the way, sounds like the kind of thing that like a Professor Doofenshmirtz would be using to take over the world.

Gaida: [00:08:44] Yes. Or the tri state area. Yes. {laughter}

Phillip: [00:08:46] Just the tri state area. There it is. I love it. What is Gigaton?

Gaida: [00:08:52] Holly, I'll let you take that one so you can explain what's going on.

Holly: [00:08:55] Yes. And so Project Gigaton is a Walmart program. And as the name sounds, it's sort of a big audacious program with a very meaningful goal. And so, again, what the name says is they want to avoid a gigaton, which is a billion metric tons of greenhouse gases, from their global value chain by the year 2030. And they look to do this by engaging with their supply chain and all the companies that sell products through them. The way that it works is they have companies commit to what they call smart goals, so they have to be specific, measurable, achievable, relevant, and time bound. They set these goals for six different areas or what Project Gigaton calls pillars. So you can choose to focus on energy or waste or packaging, product use. There are six of them in total. And as Gaida shared, really when you're doing sustainability, really, you can start with one, which is great, just to get things going and then make your way through additional ones. And what they do is they report emissions reductions to Walmart. And then when they do that, they're eligible for recognition. And Walmart has set it up with two levels. One is called Giga Gurus. And one is called Sparking Change. Giga Guru, as the name guru seems to imply, is the higher level. And the way the differentiate is, it's the number of pillars and the kinds of targets you're setting kind of put you into one of those categories. And then once you get into the program, you start to do that, Walmart promotes that you were doing that to the outside world, inside to their buyers, to their staff. And so there are these benefits of participating.

Brian: [00:10:41] Incredible initiative that Walmart's engaged with you on. I find that, you know, that's a BHAG (Big Harry Audacious Goal) worth pursuing. You know what I mean? {laughter}

Phillip: [00:10:51] I guess I would ask for clarification, though. This is being levied against all of Walmart's vendors? This is a global program, I'm guessing is what I'm asking.

Holly: [00:11:01] Correct. So it is open to and they're encouraging all of their vendors to participate in it. And what we're seeing on the ground, because the companies that we work with are the folks in there in Walmart's supply chain. So what we're seeing is there's a lot of interest to participate. But as you might imagine, a lot of companies of all sizes don't have sustainability staff or have never even if they have a sustainability staff, they may not understand or know carbon accounting. So we see a lot of like, "We want to get involved, but we don't know how to do this." And as Gaida said, this data is all over the place. Even if they're involved in the program, they've been doing it, we're finding a lot of companies are not efficient yet. They have you know, this person tracks this one part of an an Excel sheet. It might be on a shared drive somewhere. So there's this problem that we're solving, which is how do you make it easy and kind of put it all in one place so that companies can do this and it doesn't become their main business? It's just a part of doing business. But this part becomes easy for them, so that they can get this recognition and do the right thing, you know, start to participate in being a part of the solution.

Brian: [00:12:12] Are you actually helping enforce consistent standards across these companies? Like are you giving them guidance and it is all self reported? How does that all work?

Holly: [00:12:23] So the way that Walmart has it's set up and the way that we do things is we follow what's called the Greenhouse Gas Protocol. And then Walmart right now invites their vendors to report up through a program called CDP, but they don't have to use that. They can also report in other ways. They don't only have to use that. So right now they're asking for reporting, but it's not like you only have one way to do it. But the way that we approach it is we make everything protocol compliant, because as this that's like the standard good accounting practices in the world of carbon accounting and waste accounting and all of that. And so whatever and however they end up reporting it, they'll always have this good base for how the data was collected and set up.

Gaida: [00:13:11] Yeah. And the way the industry, since it's an emerging industry, there are all these different places you can report to. All of them go back to this protocol that Holly just mentioned, which is why we do everything pursuant to protocol that way, no matter where an organization wants to report to they have the numbers done in a way that is compliant and that can be reported on in any of those ways.

Phillip: [00:13:35] Who all is impacted? Is it the products on the shelf from these brands across the board? It sounds like it's an opt in program at the moment. But as things typically go, you know, it's probably a trial balloon for more rigid enforcement of like how we qualify which vendors should be prioritized or sold at at Walmart. You know, what do you see the program sort of growing into and maturing into? Is it opt in at the moment? And which brands are affected or impacted nowadays?

Holly: [00:14:03] So I think very much to your point, Phillip, is I don't know where Walmart's planning on going with it, but if you look at history, they have had another program that was a sustainability index, and that was definitely more direct impact. You got like priority. They were saying that they were filling their shelves with a certain percentage of products that were participants in that. So to your exact point, this isn't there yet, but it kind of feels like based on history, they may be heading in that direction, especially as this becomes something that's that is getting so much attention in so many areas. And so to that point, it seems like it's going to have a pretty wide range of impact. If you look at who's opted in, it's across all different categories. So that seems to be where it is and where it's going.

Gaida: [00:14:58] Walmart has this name that, you know, the Project Gigaton, but lots of other organizations are implementing similar things. And so whether sometimes it's an investor that is then requiring its portfolio of companies to make certain reductions or make certain disclosures. Or even, you know, you have a Target out there making a commitment that 80 percent of their suppliers are going to reduce or report on their Scope 1 and two emissions. So to reach those goals, I think it always begins kind of being a voluntary thing. But eventually, if the goal is to be at 80 percent plus of companies that are measuring and reporting on their emissions, it's going to eventually, in my opinion, become a part of doing business.

Brian: [00:15:45] So you're saying it's going to be both a requirement, but I think I also heard you say that there's going to be sort of a carrot associated with this as well, where, you know, suppliers and vendors that do, you know, that invest and become the gurus are going to be given preferential treatment on shelves and online. Is that right?

Holly: [00:16:06] I would say that the carrot right now is that they let their internal, you know, folks know who is participating. But the thing that I was saying about how they set a requirement was a past program with a sustainability index. So I'm not sure if this one will definitely go that way. So I don't want to go on the record as saying it definitely is. It's just it could be heading in that direction.

Brian: [00:16:28] I see.

Phillip: [00:16:30] Well, I am going to speak out of turn here a little bit, but it's, you know, every every new change of administration in the United States comes with new expectations around vehicle emissions, for instance. And next thing you know, every car I've bought in the last three or four years has like an auto stop functionality, which in the state of Florida is a real... You kind of suffer through your vehicle, stopping for five minutes at a stoplight. But you do it you know, you do it because it's the right thing to do. Eco mode and all that. I see this as businesses of all sizes, certain ones will have this. Certain consumer package goods businesses will have people that are dedicated to making sure that this is a core area of their focus. It's really the midsize businesses that I think will struggle here or the SMBs that struggle. How much of their day to day can they put into tracking emissions so that they, at some point in the future might be able to still retail in a channel that they're dependent on at the moment, say, a Walmart or a Target? How much impact do you think that this has on SMB? And when I say SMB, I mean specifically, you know, these are direct to consumer brands that are growing online first. They're digitally native brands, and they're getting massive distribution now in these big box stores. A great example today is like Ugly Drinks now has distribution at CVS. It's a three year old brand, you know, beverage started online. Who buys seltzer water online? Apparently a lot of people, but a lot more are going to buy it when it's at Walmart. So I'm curious what happens with this emergent type of a consumer brand who may not be ready for internally, you know, this level of accountability just so that they can continue to sell at at a Walmart or a Target? Any thoughts about that?

Holly: [00:18:36] Well, it may represent an opportunity for kind of SMB sized companies, because just by nature of being a bit smaller, they would have a less extensive footprint. You know, you would think that would follow. And so they can also start with, we didn't really talk about this, but there's different Scopes of your emissions profile. And some are the things that you have control over and then some get deep into your manufacturing. So all of these companies are going to have vendors and supply chain down the line from them. So they could start by looking at the parts of their footprint that they have control over or closer control over. And we do a lot of that with our customers as we start with one thing, and then over time, over the years, they build and add in additional things. In that way, it becomes more and more manageable. And Walmart has really set it up that way. If we speak about that, because you can pick a spot, you can say, "I'm going to focus on energy or waste," and just start with that. I think Walmart and we see that is everyone at this point understands that little steps or medium sized steps are all good. And so that's the way we approach it. We make this affordable because we help people to understand what do you need to do based on who you are reporting to and what things you want to impact so that you can get your foot in the door and then kind of build it from there.

Phillip: [00:20:06] Progress over perfection.

Gaida: [00:20:06] Yeah. It is and it's also, like Holly was talking about it being an opportunity. [00:20:13] When you're a relatively new company, you have a great opportunity to make this a part of the way you do business from the get go. And you start with what you can do, as Holly said, and you can build your processes internally to already account for this and grow it as you grow. Right? Whereas I think sometimes for larger organizations, it's going to be much harder. Not only do you have a much larger impact on the environment, a much larger footprint to account for, but your systems have been going on, your systems in place for a long time, and they may be more difficult to capture. And smaller, they may not have the resources yet, but they have an opportunity to start doing it right and to build it the right way from the get go. [00:20:54]

Brian: [00:25:30] One more thing that's interesting here is that I feel like this is also a bit of a moat that Walmart is building around its program because there's actually a value add in many ways, like a lot of these companies know that they need to move this direction. They know it's going to be a requirement of investors or of other suppliers or other marketplaces they're selling to. And, you know, Walmart is basically saying, hey, like we're going to give you the toolset that you need in order to get to the level that you know you're going to need to be at. And so it actually kind of helps them, helps their vendors get to a place they already know that they need to be at. And so they'll actually stick around selling to Walmart and through Walmart as opposed to going to maybe one of the other competitors that you mentioned earlier.

Phillip: [00:26:20] Yeah, it's an enablement play.

Brian: [00:26:23] Right.

Phillip: [00:26:23] You have to provide the education and the tooling. Right?

Gaida: [00:26:26] There's also part of this. So we've been talking a lot about the carbon part. But there's also, for example, one of the pillars there is waste. There is a lot of money to be saved, which is what we're seeing when people start to, companies start to pay attention to their waste. So a lot of this and also in different energy policies or ways of procuring your energy. So this also is an opportunity in that we go in and shine a light on the hot spots, your carbon, your waste hot spots, and then those become your packaging hotspots. Then that becomes opportunities to find money where you may not have even thought about it before.

Brian: [00:27:03] Interesting.

Phillip: [00:27:04] Ooh, I have to believe... So you said one of the sort of daunting tasks is just where to start, and it sounds like you have a framework of like here's how we start in a business of any size and grow both visibility and accountability in this sort of accounting way. Project Gigaton, whatever the purpose might be behind adopting an emissions or carbon accounting platform like SustainaBase, you have a process that you bring in. I have the sense that this kind of becomes a pretty deep rabbit hole over time where vendors have vendors and vendors' vendors have vendors, and it's sort of like the thought experiment, like to truly create a cappuccino from scratch you must first invent the universe. I have to believe that there's like, how deep does the rabbit hole go? And are you looking into things like technology platforms and cloud computing platforms and what their potential impacts are? And is that something that comes into account when you're helping to provide some guidance to a business that comes to SustainaBase?

Gaida: [00:28:03] Yeah. You know, it's we take this approach in the sales process, getting an initial understanding. And then even when we onboard customers to get a very deep understanding, so that they can view their operations through the lens of carbon and environmental impacts, which most of them haven't really done before in the way that we do it. And from there, I was comparing this to tracking these impacts, similar to the way we tracked dollars. Dollars definitely you're going down the supply chain and up the supply chain, you know, deeply. You know, everyone's tracking it. And eventually, this is where the environmental impact side and the climate side will get as well. So when you start to view your operations through the lens of carbon and you start to see. We were talking about more, I'm going to get a little science on you here, but like the Scope 1 emissions, these are the emissions that your direct operations will create. So maybe your own facilities or your vehicles, and some organizations will start there if they haven't already measured that. And then there's the Scope 2 emissions, which are the ones that are happening maybe when you purchase electricity. So they're indirect because they're happening at a power plant. And then you have all of these Scope 3 emissions, and that is where for most companies, the majority of the emissions are going to lie. Because that's going to be everything that they purchase, every good and service that they purchase. Their business travel, their employee commuting, their waste disposal, either transportation and distribution, everything. And so they start to see where the hotspots are that Holly mentioned. And then they can decide from there, okay, wait, these vendors or these suppliers are, you know, leaders and these other ones are not. And what strategies can we put in place to help them move along? And then start to see what programs can we put in place to help with a business travel or to help with reductions in employee commute? So you can start pinpointing. How can we have better distribution transportation systems to reduce? And the effect of going deep into all of this is that not only there's the benefit to the world of having every other organization that's involved also engage in reductions because they're a part of this whole. But also, you know, they're making their product have a lower footprint and the organization have a lower footprint, that's a benefit to them. So, yes, it's far reaching. But it's a good thing for us that it is.

Holly: [00:30:40] We work with a lot of Nestle brands and similar to Walmart, they have set for themselves very clear, specific goals. And so we're seeing this thing that Gaida is talking about that through them and through them making the [00:30:53] statement, we now are going out to their supply chain, gathering the data they need to go deep into that, and at the same time, educating all of the folks in the supply chain that this is important and that they are going to have to be paying attention to it. So everyone will start moving. Like what we're talking about today is not going to be what our conversation will be in a year or two years because the awareness is being raised. [00:31:15]

Brian: [00:31:16] You mentioned far reaching impacts. That definitely sort of triggered in my mind. I mean, the far reaching impacts could be everything from who you host your eCommerce website with. And all of your IT infrastructure. How far do the Scope 3 extend to?

Gaida: [00:31:40] All of that. Yeah. So you see companies might choose to host with one provider over another. And it used to be that you would look at, you know, being able to scale and security issues, et cetera. And then another factor might be, if that's important to your company, and I think it should be, is what is their carbon footprint and how is that going to then affect my carbon footprint? And it's the same thing with many other aspects of the organization. For example, shipping. Right? You might choose to go with a carbon neutral shipper versus not. So these metrics are going to affect that decision making. It's going to be one of many factors that are going to be considered when making those decisions.

Phillip: [00:32:21] I didn't prepare you for this question, but it's top of mind. I just out of nowhere, I'm thinking about a brand like Allbirds. And they've gone a long way to sort of tell the sustainability story from the get go back when they were doing very small brand. You know, these days, still in a lot of their product launches, they are quantifying carbon footprint on a score basis. I'm not asking you to specifically comment on Allbirds, but do you think that there's a consumer angle to this? And is this going to be much more broadly understood or part of the purchasing decision that a consumer makes? Because my sense is that corporations probably have a much greater impact on trying to make a dent in carbon emissions than consumers do. But we seem to have a lot of brands that are trying to push consumer awareness of their own carbon footprint and how they're contributing to it in the goods that they purchase. Does all of this corporate governance and compliance sort of trickle down to more awareness on the consumer side?

Gaida: [00:33:21] I think so. It's funny that you mention Allbirds. They are on my feet right now. And if I recall correctly, I think I'm wearing nine kilograms of MTCO2s on my feet. {laughter} I don't remember the exact number, but it's yes, it is very cool how that trickles down to the consumer. You know, I was talking before voting with your dollar. And I think that's why. I think it's the consumers are demanding from a lot of different, not just apparel, but lots of different sectors that products be more sustainable. And that is a great way to show, you know, we are measuring, we're tracking, and we're even showing to you the amount of carbon in this particular product. Or the percent waste reduction or how much water we've saved, et cetera. [00:34:09] I think that as consumers become more informed, this becomes more and more important to them. And you even hear of companies starting to think that one day we're going to have a label similar to a nutritional label for products. [00:34:23]

Brian: [00:34:23] And could you see SustainaBase powering that? Do you have tools right now to surface data that in a way that is digestible for consumers?

Gaida: [00:34:32] So we can track the data for a brand as a whole or a particular product or the products across their products. So, yes, we can certainly get the type of data needed for them to report. But again, it depends on their goals and what it is that they want to do with it with their brand. And Holly, this is really more your area on the branding and marketing side. But from a data perspective and the science perspective, we've got them covered.

Brian: [00:35:01] Do you see ever like creating a set of standard types of data that you would say is best practice for your customers to surface to their customers?

Gaida: [00:35:15] Oh, sure. And we certainly discuss with our customers what those are. We're already doing that. I think that answers your question.

Brian: [00:35:25] Amazing.

Gaida: [00:35:25] Right. So we're happy to discuss with customers who are not sure what the best practice is or what they'd like to do, what the options are. And like Holly said, start with something that makes sense for them and then grow it from there to where they want to get to.

Phillip: [00:35:39] This dovetails very nicely because I did my job as a podcaster of steering the conversation to this next question. There's this podcast I listen to often, friend of the show, Stephan Ango, who has a podcast called Well Made. I envy him because he doesn't publish every week. He publishes when he feels like it. And God, wouldn't that be great, Brian? But he recently had this like climate reporter on and Kendra Pierre Louis was on the show and they were talking about this concept of like climate anxiety and how a lot of consumer awareness campaigns sort of landed, you know, landed a lot of responsibility on the end consumer of having some sort of a responsibility and the impact in us reducing emissions or, you know, I don't know, trying to avoid some sort of climate catastrophe. Which, by the way, if you read the news today, that doesn't sound like it's going very well. So a lot of this climate anxieties sort of landed on the end consumer. And in reality, maybe the end consumer actually can't do all that much. It really requires corporations to have to change business practices. And in order to do that, we need to provide them with some incentives. What do you think about that? You know, sort of a jump ball question, like what do you think about that point of view? It's good to surface data to a consumer, but at the end of the day, I think the bakery around the corner from me that throws away, you know, 200 loaves of bread is probably more of a culprit and has could probably do a little more than I could ever do as a consumer in putting things out to the recycling at the curb.

Gaida: [00:37:29] It's interesting. You know, it's the role of individual versus the role of corporations and government and also what psychological effect that has on individuals such as when you were mentioning with the climate anxiety for the reporter you were talking about. She's not alone. There are a lot of people that are feeling that anxiety. Just the more you become informed, you feel it. And we all know that one person or one company or one government, regrettably, is not going to be able to solve the issue on their own. It's going to take a collective effort. It's going to have to be attacked from many angles. And so it's a very complex problem that's going to require very complex, coordinated solutions. But at the personal level, I think that you take action where you can take action. Right? So like for me, with starting SustainaBase, I knew that I also understood that when you look at the big picture, corporations and governments have the biggest impact. Which is why we wanted to start this. Because the more we can ease the tracking of information so that they can spend more time actually making reductions and changing business practices is more important on the government side and on the corporate side. But then as an individual for me, you know, starting the company, doing this, et cetera. But for most individuals, that might look different depending on what you were trying to do. It might mean that you're going to join a nonprofit and devote your time. I mean, like I said, you might be voting with your dollar and/or getting a group of people to do that and trying to do it massively to make a difference. Voting at the ballot box. That's huge. Right? So and then also maybe encouraging employers to take action, like be the voice at your company that's asking for this to happen as well. And on the organizational side, it's so important that they measure their impact, that they're creating targets to reduce, that they're delivering on those targets. And that they're engaging their suppliers to make sure that they are also creating these targets and delivering on these reductions. And for organizations to then work with everyone from their landlords to the suppliers so that everyone's trying to reduce their carbon footprint.

Brian: [00:39:43] You know, it's interesting you mentioned governments in there. We haven't really talked a little bit about that, yet. I think you work with a number of different government agencies. And so I'm really curious like how things are happening at a local level, like what kind of government carbon accounting are we seeing being rolled out right now? And how does that sort of work into the process?

Gaida: [00:40:06] Sure. Yeah, we do. We do work with numerous governments, counties and cities. And the carbon accounting is not so different from them. If we're talking about they're tracking their municipal emissions and their water and their waste, and we help with that. They're creating their strategies. They also have a community component where they can look at how this is all affecting the community and what impacts the community is having on the environment. So we help track all that. And we like I said, we're not there to tell them, you know, this is what you should do next. But what I find really interesting and exciting is once they have this information, then they're able to spend so much more of their time, especially in government. I think there's less time, sometimes less staff, to then take that information and do something really meaningful from it. And in a government perspective, you can do a lot. Holly, I don't know if you have anything else to add on that side.

Holly: [00:41:12] No, I think it's heartening that more of them are doing this. And they're reporting it out, and they're tracking, and they're setting goals. So just like Gaida said, that's really where the work is going to come from, from the governments and from the businesses. So we like when we get invited in to help them with this so that they know where to focus their efforts.

Gaida: [00:41:37] It's not just the initial kind of measuring, but what I think is really important is that you hear not just the government side, the corporate side as well, that we're going to create this target to reduce X by X percent by this date. So unless you're really tracking progress and seeing what's really working to move the needle to get you there, you're not going to get there. [00:41:57] It's like kind of when you create your own personal budget or for your company budget, and you're not really tracking progress on a regular basis, how are you ever going to get to that goal? So, you know, really the mission here is to help them track it and help them make sure that they are changing the strategy if needed, so that they make it to that goal with real data.  [00:42:16]

Holly: [00:42:16] Yeah. And to share like a fun kind of specific example, [00:42:19] one of the municipalities we work with, so based on our data, they're doing two things. One is they have a big tree canopy project because they want to increase the shade. They have issues with wanting to decrease heat in certain parts of their community. And so that's something that we can help them track over time as the value of those trees and helping them to offset. And then the second one is based on seeing the data on the energy side, they're now doing a whole solar feasibility study. So they were going to just do some actions, but now they're going to involve more of their buildings and the right buildings in that feasibility analysis. So there's some really exciting things happening. And they have hundreds of buildings, so that's a high impact kind of action to happen. [00:43:07]

Phillip: [00:43:08] We're almost out of time. This has been so educational for me. Thank you so much. When you mentioned ESG factors and, you know, we're sort of talking about there's so many different layers and levels here where impacts could be made. Brian, I'm thinking back to the beginning of the year when we had Sucharita Kodali on the show and she was talking about, I asked, "What are the things that will become emergent in 2021 that when we look back it'll shape sort of the beginning of the next movement in consumer investment?" And in her first response was, "A lot of where we are in the world has been just fueled by cheap overseas manufacturing." And, you know, now there's a number of investors who actually care quite a bit about the given values in ESG, values of the company. And if they make their investments differently in this decade, potentially we see businesses built in a very different way. And so I think that it's not even just at the government level. I think from a capital and public markets and private capital perspective, this is happening all across the board. And that's where I think that this is the setting the tone for the next decade, which I think actually ladder's in very nicely. I just use the word ladders. Oh, my gosh. Enterprise is rubbing off on me, Brian.

Brian: [00:44:41] {laughter}

Phillip: [00:44:41] Goodness me. I will never live this down, but we're going to keep it in. So you'd written this great post, Holly, on the three C's of supply chain accountability. And I think that that sort of comes back down and brings us sort of full circle here. What are the three CS? And how can we understand them in a way that can lead us to action?

Holly: [00:45:03] Sure. So what we're seeing going on is the carrot, the conversation, and the club. And it doesn't mean they're mutually exclusive. We think over time, companies will employ maybe all or across them. So the carrot is kind of the Walmart example where if you go ahead as our supply chain and participate in this way, we are going to do some positive things to help you out, because you're heading us in the right direction. On the conversation or things, and this is very relevant for direct to consumer companies. We do a lot of analysis on transportation and distribution of products, because you have to account that in certain of the reporting frameworks, and that is a conversation opportunity. So if you are a company and use a lot of FedEx or DHL and you hear that they are going to start offering zero emissions, you can have a conversation with them, see if you can get involved in a pilot or how it will lower your emissions by being involved in it and start communicating to them that this is important to you and that maybe the more companies they have these conversations with, the more it will even accelerate their plans from where they are today. And the last one is the club. We are starting to see some companies right into their vendor agreements that if you don't hit certain thresholds, there will be even penalties. And so there's not a lot of that yet, but we're starting to see that starting. And so that is sort of the trend that that we're seeing across these different approaches.

Phillip: [00:46:38] Wow. A topic that we don't talk enough about that we should talk a whole lot more about, but one that I think is probably the most important of all and doesn't get enough air time here on Future Commerce as a podcast. What an amazing, you know, 40 some plus minutes it's been. Such a pleasure to have you Gaida. Thank you so much. And Holly, what a wealth of knowledge you two are. It's just been really great. Where can people find out more about SustainaBase?

Gaida: [00:47:05] Yeah, SustainaBase.com is is the place they should go. Check us out and reach out if you have any questions. And thanks so much for having us on here. We really enjoyed talking with you and explaining what we do. And it's always great to talk about this issue. It's so important.

Phillip: [00:47:22] Thank you so much. Really appreciate it. And now we want you to lend your voice to the conversation. If you're out there listening, we want to hear what you think. You can always do that by dropping us a line at hello@FutureCommerce.fm. Or if you want to hear more where this came from we have 200 and some other odd episodes to get you up to speed on everything you need to know about what is coming and what is next in commerce. You can find that more episodes of this podcast at FutureCommerce.fm or anywhere where podcasts are found. Thank you for listening to Future Commerce.

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