• Strategy
  • CFO Europe Magazine

Road to Reform

Green business travel turns a corner.

She reckons the new system paid for itself in six months. Over an 18-month period, she adds, four projects saved 196 man-days of travelling time, more than 8,000 litres of fuel, over €600,000 of costs and, significantly, 23 tonnes of carbon dioxide. According to her calculations, rolling out videoconferencing across the company could achieve €1.5m of cost savings and a reduction of 540 tonnes of carbon dioxide every year.

There was also an “unanticipated spin-off” from the project — better attendance and a greater number of meetings than the norm when staff had to travel to meet in person. All projects lasting less than one year are now required to use videoconferencing. Today, Skanska UK has 30 videoconference facilities, including a new one in the CEO’s office.

Happy to Travel

Despite such success, getting globe-trotting business travellers to curtail their trips remains a tough sell. A new survey of 2,400 business travellers in Europe and North America by Egencia, a travel management company, found that two out of three respondents enjoy their business trips and, in many cases, cite travel as a key factor to general job satisfaction. As for concerns about their globe-trotting’s impact on the environment, more than half of the European respondents said that they were not worried about CO2 emissions. Only 4% of Europeans are what Egencia calls “green travellers,” in that they will travel by plane only if there is no other option.

This will soon change, if AT Kearney’s Hansen gets her way. At the consultancy, travel accounts for 80% of company-generated emissions, a high figure — travel experts at American Express reckon that travel is responsible for 20% of emissions at the average company — but not unusual for a services firm whose staff often work off-site. Hansen is tackling the challenge from several angles, encouraging business units to reduce travel for internal meetings; shift from air to rail travel when possible; and use carbon-efficient airlines, hotel, rental car agencies and other travel services.

Though a tall order, Hansen reckons several existing factors are making the project a success. Even before the initiative began, AT Kearney had centralised systems, so it already had a wealth of credit card, airline usage, as well as travel and expense management data from across its operations. All this data was essential for a group of external scientists that AT Kearney hired to develop a system of measuring and monitoring the company’s carbon emissions. “What’s phenomenal is that we can measure our footprint by country, business unit, employee and rank,” she explains.

It wasn’t only the vast amounts of travel-related data that has been key to the programme. Hansen also cites the flexible nature of the programme, allowing business units to come up with their own ideas to make travel more eco-friendly, “according to their local needs.” Also critical was the decision to bill every business unit based on its carbon footprint. “That’s a really good way to get everyone’s attention,” she adds.

The Devil Is in the Data

And Hansen is not working in isolation. CFO Dan DeCanniere, for one, has charged his team with “owning” the programme’s data. Information flows through finance for quarterly emissions reporting, populating what Hansen calls an “e-room” — a new online, self-service repository of data that allows sophisticated modelling and scenario planning. Finance also “sets the agenda” for a quarterly sustainability conference call, during which business units discuss new initiatives — ranging from a scheme to encourage staff to cycle to work to a policy that requires rail-over-plane travel.

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