FMCG firms try to reduce carbon footprint

As governments debate ways to reduce carbon emission levels at the climate change summit in Copenhagen, some fast moving consumer goods (FMCG) companies are doing their bit to rein in carbon footprints.

FMCG players can reduce carbon emission at two levels, the manufacturing and supply chain, says Chaitanya Kalia, partner, risk advisory services, Ernst & Young. Typically, companies undertake measures to reduce their energy consumption from conventional sources. For instance, 38 per cent of the energy used in the beverage business of PepsiCo in India comes from renewable resources. In its foods business, the figure is a little lower, at 20 per cent. Dabur has 30 per cent of its steam generation fired by renewable resources. “We intend taking that to 50 per cent in the next two years,” says Sunil Duggal, CEO.

These measures are meant largely to prune costs. Some companies such as Hindustan Unilever, ITC and even Pepsi do go a step beyond into areas such as water conservation, afforestation, etc but more of this needs to be done across the board, say experts. These companies, especially, HUL and ITC, for instance, have earned voluntary emission reduction (VERs) and certified emission reduction (CERs) credits for their work, respectively. Broadly known as carbon credits, HUL, for instance, was awarded 52,000 VER credits for developing a new soap-making process called ‘Plough Share Mixer’ that eliminates the need for steam altogether. “We are awaiting the CER certificate from the United Nations Framework Convention on Climate Change (UNFCCC),” says a company spokesperson.