Appendix

List of Common Climate Change Business Risks and Opportunities Explanation of one-letter codes appearing below: M = mitigation—reducing climate change and its impacts A = adaptation—coping with unavoidable impacts from climate change

ENERGY: ELECTRICITY, STEAM AND FUEL

General • Create “Scope 1 + 2” GHG emissions inventory in accordance with the Greenhouse Gas Protocol Initiative (www.ghgprotocol.org). M

Facilities/Built Environment • Replace inefficient lighting systems (switch to

T5, T8 or LED; install on-only-when-occupied systems). M

Replace inefficient HVAC systems (replace motors, install variable-speed fans, adjust thermostats, ensure efficient airflow, check heating systems for leaks in boilers and pipes, upgrade boilers). M Check for substandard building insulation and airflow (have building envelope and airflow audited, use white roofs for warehouses, install ceiling fans). M

Integrate solar and/or wind into your energy supply. M/A Increase natural light (especially in warehouses). M/A

Identify and replace inefficient food service equipment in onsite cafeterias (upgrade vending machines, cold storage, cooking equipment). M

Buy renewable energy certificates (RECs) to offset CO 2 emissions. M Install efficient backup generators (in case grid goes down). A

Operations • Replace inefficient/outdated machinery and equipment motors (upgrade/replace). M • Swap out constant-run machinery and conveyors (install idling equipment). M • Replace inefficient materials-handling equipment (consider propane or fuel-cell energy sources). M • Choose EnergyStar® office/service and IT equipment). M

Transportation • Identify fuel-hogging transportation equipment (increase percentage of logistics spend with

SmartWay® carriers). M • Look for and change any inefficient transportation routing (upgrade owned/leased assets to latest transportation management systems (TMS) with telematics). M • Eliminate onsite truck idling (create/enforce noidling rules). M • Reduce percentage of shipments by air (improve inventory management/order fulfillment systems, consult with subject-matter expert or third-party logistics on modality choices). M • Reduce percentage of employees commuting alone by automobile, especially during peak hours (offer carpool/bike options, public transportation subsidies, flexible shifts). • Eliminate unnecessary business travel (consider off-the-shelf or dedicated telepresence options).

M • Create backup/secondary inbound and outbound routing options (have a second plan in place in case routes/modalities are unavailable). A

B2B/SUPPLY CHAIN • Establish a code of conduct for suppliers that includes environmental and social responsibility language (redraft and redistribute as necessary).

M/A • Include environmental and social responsibility/ performance requirements in your RFPs and supplier contracts (redraft and redistribute as necessary). M/A • Use supplier performance-management systems to hold suppliers accountable for environmental and social impacts (create/update supplier scorecards). M/A • Provide mentoring to diverse suppliers on environmental and social responsibility. M/A • Award high-performing suppliers on sustainability bid preference (created tiered bidding system). M/A • Put sustainable/responsible purchasing policies and practices into place (create policies and practices that reach the category level). M/A • Catalog the life-cycle impacts of products and services (conduct life-cycle assessment on a select group of products/services). M • Understand the supply risk landscape, especially around climate risks (undertake multidimensional supply risk analysis; whenever possible, avoid single-source supply). A • Disclose GHG emissions inventory and request that business partners do the same (consider CDP or other public platforms). M/A • Disclose climate change goals, actions and progress and request that business partners do the same. (M/A)

WATER

General • Engage with Detroit Water and Sewerage

Department (help identify water quality and efficiency strategies and opportunities). M/A • Consider creating an organizational “water footprint” to gain understanding of which parts of the business are water “hot spots.”

Facilities/Built Environment • Eliminate inefficient water use by chillers/HVAC (conduct system integrity audit). M • Reduce water use in restrooms (install low-flow toilets, waterless urinals). M • Eliminate inefficient/excessive landscape irrigation (switch to “brownwater” landscape irrigation). M/A • Divert water runoff/poor stormwater management for secondary uses (capture water prior to runoff, consider site survey for site-level adaptation options). M/A • Identify and eliminate water pollution from pipes, drains (stop discharges, review pipe/drain integrity). M/A • Reduce water pollution from landscape treatment (reduce fertilizer use). M/A

Operations • Check for excessive process water consumption (review all systems for leaks). M • Check for excessive water consumption for cleaning/sanitization (consider air cleaning options). M

Products/Services • Identify any excessive water consumption during product use phase (conduct life-cycle analysis focused on water, re-engineer product). M/A • Reduce the amount of water as a product ingredient (consider concentrated product options). M/A • Work to understand excessive “embedded” water in a product (for example, product manufacturing is energy intensive, raw materials/commodities require high water consumption in growing, harvesting, processing; consider product reengineering options). M/A

GREEN JOBS • Promote the company as “sustainable,” with facts to support claims (review marketing and recruiting materials, recruiting processes). • Engage the local community about energy, water and waste issues ( join/sponsor community groups). • Upgrade your employees’ technical skill sets required in alternative energy, waste and water management (offer paths to education and promotion based on acquiring these skills, support community and other educational institutions with these in their curricula, participate in/ promote “green” job fairs). • Check out any industry-level focus on green jobs (review alliances and consortia offerings, act as an advocate for these). • Mentor those interested in green jobs (hire interns, connect with academic institutions seeking clinical opportunities for students, help with capstone projects focused on sustainability). • Finance green jobs (work with banks, lenders, investors, analysts to create the connection between access to capital and green job opportunities).

PREPARED BY:

Robert W. Kuhn, Kuhn Associates Sustainability Advisors LLC

August 2017

In Partnership With the Detroit Climate Action Collaborative

WITH CONTRIBUTIONS FROM U-M FACULTY AND STAFF

Dr. Joe Árvai Faculty Director, Erb Institute | Business for Sustainability

Dr. Ravi Anupindi Professor of Operations Management and Research, Stephen M. Ross School of Business

Terry Nelidov Managing Director, Erb Institute | Business for Sustainability

© 2017 by the Regents of the University of Michigan