I purposely “disconnected” myself from all news over the holidays, so I’m still catching up on my reading.   I came across an interesting article in the Wall Street Journal yesterday (published December 30^th) highlighting Dell and its claim of being “carbon neutral” (“Green Goal of ‘Carbon Neutrality’ Hits Limit“).  In a nutshell, the article highlights the items Dell includes and doesn’t include in its “carbon footprint” (see this interactive graphic) and argues that the company is effectively only neutralizing about 5 percent of the greenhouse gases linked to the manufacturing and use of its products.

The underlying issue is related to the piece I wrote yesterday: the lack of metrics and standards related to “green” initiatives.  This was the main problem that speakers from HP, Herman Miller, and other leaders in this area discussed back in October 2007, when I chaired a track on “green” supply chain management at the Council of Supply Chain Management (CSCMP) annual conference.  What factors do you include when calculating your “carbon footprint?”  There’s still no standard definition, so companies can adopt a very narrow definition (which is the norm) or take a very broad perspective.  According to the WSJ article, Dell’s carbon footprint calculation includes “the emissions produced by its boilers and company-owned cars, its buildings’ electricity use, and its employees’ business air travel.”  The company does not include “the oil used by its suppliers to make its computer parts, the diesel and jet fuel used to ship those computers around the world, or the coal-fired electricity used to run them.”

Is Dell’s carbon footprint definition too narrow?  I think this question is irrelevant because, as the article highlights, many suppliers don’t have the means, knowledge, or incentive to measure their emissions.  And without universally accepted standards and metrics, there’s no way to ensure consistency in the data received from suppliers around the world.  The same holds true for customers, as Dane Parker, Dell’s director of environment, health, and safety, states in the article: “Customers’ contributions to the overall [carbon footprint] pie vary depending on how and where they use their computers.”

The article highlights other companies, including Timberland, Google, and News Corp, that take a similar approach to Dell in measuring their carbon footprints.  The article also questions the validity of companies buying renewable energy and environmental credits to neutralize their carbon emissions when many of the projects selling the credits were going to be built regardless of this revenue.  But this is a topic for another time.

Here’s what I think: it doesn’t make sense for companies to claim “carbon neutrality” at this time because there’s no standard definition for this term, not even within a single industry.  I don’t fault Dell and other companies for aligning their carbon footprint definitions with factors they have the most control over.  Companies have to start somewhere, and focusing their initial carbon-reduction efforts “within their four walls” makes sense to me.  However, making public claims about achieving carbon neutrality, when this term can have any meaning a company wants, just opens the door to public skepticism (such as the WSJ article) and claims of “greenwashing.”  Instead of making claims, industry leaders should work together to develop a common definitions and metrics for “carbon footprint” and “carbon neutrality.”  This won’t be easy or quick, but it needs to be done sooner rather than later.

What do you think?