10 Key Sustainability Terms

Building on the previous terms, here are 10 more important sustainability terms that businesses need to know. These terms are important for understanding how companies can operate sustainably and meet environmental standards.

1. Scope 1 Emissions

- What it means: These are the direct greenhouse gas emissions that come from sources a company owns or controls.

- Example: If a company owns a fleet of trucks that run on petrol, the emissions from burning the fuel in those trucks are Scope 1 emissions.

2. Scope 2 Emissions

- What it means: These are the indirect emissions from the production of energy that a company purchases and uses, like electricity, steam, or heat.

- Example: If a business buys electricity from a power plant that burns coal, the emissions produced by that power plant count as Scope 2 emissions for the business.

3. Scope 3 Emissions

- What it means: These are all other indirect emissions that occur in a company’s value chain, including upstream (suppliers) and downstream (customers) activities.

- Example: Emissions from the production of materials the company buys, or from the use of its products by customers, are Scope 3 emissions.

4. Life Cycle Assessment (LCA)

- What it means: A method used to evaluate the environmental impact of a product or service throughout its entire life cycle—from raw material extraction to disposal.

- Example: A business conducts an LCA to determine the carbon footprint of a product, from mining the raw materials to the final product's disposal or recycling.

5. Sustainable Development Goals (SDGs)

- What it means: A set of 17 global goals set by the United Nations, aiming to address issues like climate action, clean energy, and responsible consumption.

- Example: A company might align its business strategy with SDG 12 (**responsible consumption and production**) by reducing waste and using sustainable materials.

6. Carbon Neutrality

- What it means: Achieving a balance between the carbon a company emits and the carbon it removes from the atmosphere, making its net carbon emissions zero.

- Example: A business becomes carbon neutral by reducing its emissions and purchasing carbon offsets for the remaining emissions.

7. Water Footprint

- What it means: The total amount of water used by a company, both directly and indirectly, in the production and delivery of its products or services.

- Example: A beverage company calculating the water footprint of producing a single bottle, including water used for growing ingredients and manufacturing.

8. Green Bond

- What it means: A type of bond specifically earmarked to fund projects that have positive environmental or climate benefits, like renewable energy or pollution prevention.

- Example: A company issues green bonds to raise money for building solar energy plants to reduce its carbon footprint.

9. Energy Efficiency

- What it means: Using less energy to perform the same task or produce the same output, which reduces both costs and environmental impact.

- Example: A company installing energy-efficient lighting and machinery in its factories to reduce electricity consumption.

10. Science-Based Targets

- What it means: Emissions reduction targets set by companies that are in line with what scientists say is necessary to meet the Paris Agreement and limit global warming to 1.5°C.

- Example: A company commits to reducing its greenhouse gas emissions by 50% over the next 10 years, as verified by the Science Based Targets initiative (SBTi).

Why These Terms Matter to Business:

These additional terms, especially Scope 1, 2, and 3 emissions, are essential for businesses looking to align with global sustainability standards and reduce their environmental impact. Understanding and using these terms in strategy and reporting can help businesses comply with regulations, improve efficiency, reduce costs, and build stronger relationships with investors, customers, and stakeholders.

By integrating these terms into business operations, companies not only work towards sustainability but also contribute to long-term success and resilience in a changing world.

10 More Key Sustainability Terms for Businesses