Doing Well by Doing Good: An interview with Tom Johnson of ClimateCHECK

The ninth installment in our on-going Leaders of Sustainability series of interviews with executives and entrepreneurs of sustainability-minded business is with Tom Johnson, Partner and VP, GHG Management Solutions with ClimateCHECK. ClimateCHECK provides green house gas (GHG) measurement and management services to a wide spectrum of clients, including those in the energy, clean technology, IT (Information Technology), non-profit sectors, as well as academic institutions.

As always, our hope is that entrepreneurs and business leaders of sustainability-focused businesses will find this series helpful and instructive in growing their businesses and dealing with both the challenges and opportunities facing small business trying to make a profit at the same time reducing their impact on the environment.

I spoke to Tom from his office located in Toronto, Ontario.

Justin – Thanks for joining us today Tom. To begin, please tell us a little bit yourself and ClimateCHECK.

Tom - Sure, it would be my pleasure. I am a trained environmental scientist, and have been working in the greenhouse gas (GHG) and sustainability sector since 2002. Prior to joining ClimateCHECK in 2007, I worked with an investment fund that supported sustainable municipal infrastructure projects across Canada. In this role I developed the environmental reporting requirements that a given project would need to meet in order to qualify for potential funding. In addition, I have participated in various federal committees related to GHG emissions, and assisted the International Standards Organization (ISO) author their standards for GHG measurements. Recently, I was invited to join an expert working group providing advice to the province of Ontario on the design of an effective carbon offsets scheme for reducing GHG emissions as part of recently announced cap and trade legislation.

ClimateCHECK was founded in Ottawa in March 2007 and today we have 12 staff in five important markets in North America: Ottawa, Calgary, Toronto, San Francisco and Boston.

Justin – What changes have you noticed about the “marketplace” for GHG measurement, reduction and offsetting since you first got involved in the industry in 2002?

Tom - That’s an interesting question. The public exposure and understanding of the topic has definitely grown exponentially, especially over the past two years or so. Also the number of individuals and companies involved in this area has also increased dramatically over the past few years.

It’s important to remember that there was very little activity in Canada in terms of GHG measurement and reduction up until about 2005. Federal and provincial governments were developing plans and issuing discussion papers, standards were being developed, but it was still a time of very little progress. I would have to say that over the past two years or so, we have really noticed a dramatic increase in activity across both Canada and the U.S.

Justin – In addition to helping your clients reduce their GHG emissions and waste by switching to cleaner fuels and technologies, ClimateCHECK also helps its clients become more strategic by making GHG management decisions that produce “financial and environmental” results. Can you please describe what this entails?

Tom - We talk about generating double dividend results, namely financial and environmental, for our clients. We like to say that we are helping our clients “do well by doing good”.

We focus on the idea that no corporation is going to be completely altruistic in their environmental efforts. At the end of the day, everything needs a business case. We create value for our clients by linking GHG measurement and management actions to a business case. For example, we have helped clients develop new revenue streams from the sales of carbon offsets and increased sales as a result of identifying and communicating credible and verifiable green marketing claims. In addition, there are less direct, but equally important ways to we help clients realize value by becoming more environmentally conscious. Recently we helped a large, multinational respond to shareholders and other interested stakeholders that were asking the company to disclose its GHG emissions, and outline their strategies for reducing their environmental footprint.

Justin – Can you give us a brief overview of a specific project that ClimateCHECK has recently completed for a client either in Canada or the U.S. that illustrates the services you provide?

Tom - We provide a range of standard services that you would expect of a GHG consulting firm. We help our clients develop an inventory of their GHG emissions as well as quantifying the emission reductions from the implementation of various energy efficiency projects or new technologies. We also have a lot of expertise in land use changes in forestry and agriculture that produce GHG emission reductions.

In terms of a specific project, we recently completed a very interesting assignment that had more to do with the business management side of sustainability than GHG management.

An international IT (Information Technology) company asked us to analyze the results and identify trends from “green” or “sustainable” IT announcements related to the Canadian public sector, namely: provinces, municipalities, education and healthcare. The objective was to help our client better position its products and applications to meet the sustainability requirements of the public sector. We are really starting to notice, particularly with governments and very large companies, the growing importance of the environment and sustainability in procurement decisions.

Justin – What do you consider to be the biggest challenge facing business in carbon market in general, and your business in particular, over the next few years?

Tom - Anyone in this sector that is even remotely thoughtful of the bigger picture has to admit that the GHG market is a very nascent one in a lot of ways. The biggest fear that we have is that there will be a significant market correction. Our market is one that is very much dependent on transparency and quality. So we are always mindful of the negative implications for our market should either its transparency or the quality of carbon offsets be called into question. Our market exists to help facilitate the reduction of GHG emission in the most efficient, cost effective manner; the carbon market must be seen as one that produces environmental benefits and credible carbon commodities in order for it to fully realize its potential.

Justin – What actions has your company done as a business to reduce its own carbon footprint and become more socially responsible?

Tom - As a services oriented company, our business model does not have a significant environmental footprint to begin with. We are also fortunate that we are a relatively young company that doesn’t have many of the legacy issues like those we are helping our clients address. With that said, we remain focused and diligent in further minimizing the environmental footprint we do create. We encourage our employees to telecommute or work from home as much as possible, our office is virtually paperless and we make every effort to do as much “desktop” work as possible and avoid any non-essential travel.

Justin – What valuable lessons have you learned on the road to success that you could pass along to other entrepreneurs or business owners?

Tom - Two important lessons really stand out from our experiences at ClimateCHECK. First, having a well respected brand where quality work is a cornerstone has been incredibly important to our success. Today, 90% of our business comes from companies that call us because they know our brand and our reputation for quality work.

Second, it’s important for a small company to become a “destination” employer as opposed to a “stepping stone” employer. When I started recruiting for this company, I was amazed by the number of vastly over qualified applicants. I came to learn that many of the “best and the brightest seem to be attracted to a work environment that is entrepreneurial and innovative. We are lucky in that the nature of our company and our industry is very much in line with those attributes. I would encourage any small business, irrespective of industry, to find a way to create a work environment that is both entrepreneurial and supportive of innovation to attract great candidates.

Justin – ClimateCHECK is also involved in two very interesting initiatives. Can you please tell us a little bit more about the GHG Management Institute and the Live Neutral initiative?

Tom - ClimateCHECK is a founding sponsor of the GHG Management Institute which was founded in 2007 as a not-for-profit organization to train and support a global community of qualified professionals to work on GHG measurement, accounting, auditing and management.

We realized early on that any effort to effectively address climate change would require the availability of highly skilled and qualified professionals. Today, there are simply not enough individuals with the necessary training, and this shortage will become increasing acute as more and more governments and organizations require the measurement, reduction and offset of GHG emissions.

Just as engineering and financial accounting rely on certified professionals, there is a need for professionals charged with measuring, accounting, auditing, and managing GHG emissions with high levels of competency and ethical standards. Today, the GHG Managament Institute provides training to professionals from all over the world, including the UNFCCC, RGGI and the World Bank, and has just partnered with the Harvard University Extension School to develop a new course on climate change.

The Live Neutral initiative is an on-line service based out of San Francisco, and is also a not-for profit. Live Neutral is an outreach and offsets retailer that helps companies develop systems to engage their employees to reduce GHG emissions. In addition, Live Neutral sells carbon offsets to help companies’ completely offset their emissions and enable them or their employees to become “carbon neutral”.

Justin – Now for one last, really difficult question – what is your favorite business book of all time?

Tom - I’m not sure if this is my all time favorite, but I am very fond of a book entitled “SwitchPoints: Culture Change on the Fast Track to Business Success.” It’s a really great story about how Canadian National Railway (CN) changed its culture through leadership and management training to become one of the top-performing railroads in North America.

Justin – Thanks very much Tom for taking the time today to speak with us. If our readers are interested in learning more about Climate CHECK, what should they do?

Tom - Thanks Justin, it’s been fun. The best place to learn more about our company and its services is our website at www.climate-check.com

Tom Johnson, ClimateCHECK

© 2009, Justin. All rights reserved.