Aviva and ClimateCare have pioneered a way to quantify how carbon-offsetting programmes can improve people’s lives
Measuring financial data and environmental impacts has become part and parcel of the corporate social responsibility and reporting cycle, and businesses of all stripes have become well-versed in measuring and benchmarking all manner of sustainability metrics, from carbon intensity and water use to human rights issues and local economic development.
However, while it is now relatively straightforward for organisations to record social outputs, understanding what this really means – social impact – is more complex, as is the question of how companies can accurately and reliably quantify, measure, and report on these social impacts. And with the UN Sustainable Development Goals (SDGs) now in place, companies will increasingly be required to think more holistically about the value they create, not just the impact that their activities have.
Increasingly companies are attempting, with varying levels of success, to find a solution to social impact measurement that is both meaningful and pragmatic.
In an effort to make measurement meaningful, the European Commission has proposed an approach that describes the differences between outputs (how a given activity reaches the intended beneficiaries), outcomes (the change arising in the lives of beneficiaries and others), and impacts (the extent to which that change arises from the intervention). The World Business Council for Sustainable Development (WBCSD) uses the analogy of a company distributing insecticide spray to help reduce the incidence of malaria. If the activity is the sale of insecticide, then the output is the number of product units sold, the outcome is the reduction in frequency of mosquito bites, and the impact is the reduction in incidence of malaria.
Certainly, it is challenging and time-consuming to measure and report the total number of people benefitting from any project, and it is more challenging still to understand what those benefits really mean for people’s lives. An added complication arises when trying to measure the overall social impacts of an initiative whose primary purpose is considered to be environmental in nature, for example the issue of carbon reduction credits.
Yet this is what the UK insurance firm Aviva set out to do in partnership with climate and development experts ClimateCare. Using the London Benchmarking Group (LBG) framework, they developed a new way to measure and report the full social impact that could be attributed to Aviva’s purchase of a specific volume of carbon offset credits through ClimateCare’s climate and development projects.
In 2006 Aviva became the first global insurance group to offset its entire operational emissions and it remains carbon neutral. In recent years, Aviva has worked closely with ClimateCare to ensure its “green” status has positive social impacts too, and now it offsets its carbon emissions through an integrated Climate+Care programme, which is designed to both protect the environment and improve people’s lives.
Clean water, clean cooking
The programme includes support for two world-leading projects:
1 LifeStraw Carbon for Water, Kenya. This ground-breaking project provides simple gravity-fed water filters to more than 4 million people. This cuts carbon by reducing the need to boil water on open fires to make it safe to drink and improves lives by reducing people’s exposure to waterborne diseases such as typhoid and cholera.
2. Envirofit Efficient Stoves, India.The stoves significantly impact both health and the environment, reducing toxic emissions by up to 80%, carbon dioxide emissions by up to 60%, and black carbon emissions by up to 40%. The stoves also generate savings for the consumer by reducing fuel consumption by up to 60%, and they improve cooking efficiency by up to 40%.
At a project level there is robust evidence of both the carbon reductions delivered and how these initiatives improve people’s lives. However, Aviva and ClimateCare wanted to understand exactly what proportion of these impacts Aviva could claim, relative to its contribution.
For carbon reductions the measurement was easy – Aviva had bought a known volume of measured and verified carbon reductions. Measuring social impacts, though, was more difficult.
However, because of the way the programme was designed, the company was able to apply the LBG Framework, which was developed by a network of corporate community investment professionals, to robustly measure and report on the additional benefits this had on local communities. Applying this framework to measure and report the social impacts of its carbon offset programme made sense for Aviva and allowed comparison with its wider community investments.
This was the first time the LBG framework had been applied to a carbon offset programme and now provides a model for other organisations that offset through Climate+Care programmes.
What makes it possible to gather this social impact data is the type of carbon reduction projects that ClimateCare specialise in – those that deliver community benefits at a household level, such as providing safe water filters or clean cookstove technology to families. In order to measure carbon reductions through these projects, households are already visited regularly to measure uptake and use of the new technology, so what could potentially be prohibitively expensive social impact monitoring can in fact piggy back on the gathering of this carbon data.
The LBG methodology measures both outputs and outcomes. ClimateCare was able to use it to demonstrate that its projects not only provided technology, but also provided information about usage and impact. This showed that in just two years, Aviva’s carbon offset programme with ClimateCare had improved the lives of 200,000 people in Kenya and India. And to date, Aviva is now able to report that it has offset more than 1m tonnes of CO₂ and improved the lives of 800,000 people.
This data, deployed through the new methodology, allows Aviva to “demonstrate the full value of offsetting our carbon emissions”, says Zelda Bentham, head of sustainability at Aviva. “It’s what our customers and investors expect so it’s really important we can credibly show this.” By using the LBG framework for its wider community investment programmes, Aviva was also able to compare the impacts of its carbon reduction investments with community investments. In addition, Aviva now has a benchmark from which it can set targets for future developments.
Aviva has committed to a long-term partnership with ClimateCare, allowing the two organisations to work closely together in delivering an integrated Climate+Care programme that reduces enough carbon to maintain Aviva’s carbon-neutral status, while improving lives around the world. With the advent of the new Sustainable Development Goals, the two partners are also working to demonstrate how Aviva’s programme delivers against multiple SDG issues and are encouraging others in the insurance sector and beyond to adopt similar programmes as a cost-effective means to deliver environmental and social impact.
Targets and talk
There are key lessons to take from Aviva’s experience of partnership with ClimateCare. It’s important to set clear targets (such as the carbon offset programme that Aviva sought to undertake through ClimateCare’s services). These should cover social as well as environmental benefits that an organisation intends to deliver by offsetting its carbon footprint. And with the art of social impact measurement still very much in the learning stage, it’s essential for businesses to talk to each other. There is no perfect way to measure these impacts, so understanding the strengths and weaknesses of each approach will help companies to decide what’s appropriate for them.
This article appeared in Ethical Corporation’s Monitoring Social Impact report last year.