Continuous improvement is a key aspect of any Environmental, Social and Governance (ESG) process. With that commitment at heart, CHAR is developing an ongoing ESG reporting framework as the first step in measuring the many ESG aspects of CHAR and our communities. Our goal is to develop consistent climate-related financial risk and opportunity disclosures for our stakeholders. The baseline metrics and methodologies for quantifying those risks and improvements, are now under development. We commit to continuously improving our ability to measure, manage and report on these ESG issues and will ensure they become embedded in all of our governance and business management processes.
Our annual ESG report is based on the standards of the Sustainability Accounting Standards Board (SASB), a non-profit organization founded in 2011 to develop sustainability accounting standards, as well as current guidance provided by the Task Force on Climate-related Financial Disclosures (TCFD), a committee of the international Financial Stability Board. By selecting these globally accepted standards, CHAR strives to provide a clear view for all stakeholders through a window of comparison, to underline how we fit within a cleantech industry that is growing and strengthening as new technologies are developed, the market shifts and demand for our products and services increase to meet the challenges of a changing global climate.
Who We Are and How We Mitigate Climate Change.
CHAR Technologies Ltd. is a leading cleantech development and environmental services company listed on the TSXV (‘YES.V’), advancing the global low-carbon future. We specialize in delivering innovative service and technology solutions the benefits of being both environmentally sustainable and cost-effective for our clients. Focusing on resource efficiency and recovery, low value material conversion and clean water treatment, our services and solutions significantly improve the environment and reduce costs. Examples include:
- Our proprietary high temperature pyrolysis technologies convert low value wastes to high value usable biocarbon end products and renewable energy, such as renewable natural gas (RNG) and hydrogen fuels.
- Our consulting engineering services help our industrial and commercial clients reach their own corporate targets by minimizing their environmental footprints related to carbon emissions, resources and waste.
- Our water technologies and related services help reduce consumption and increase conservation of fresh water, optimize facility use and reduce discharges of this precious resource.
- Our energy efficiency engineering capabilities help lower our industrial clients’ emissions through energy audits and design/build/installation of energy efficiency upgrades at their facilities. We help clients reduce natural gas combustion and electrical energy consumption, which allows them to save supply costs, reduce carbon taxes and reduce their reportable Scope 1 and Scope 2 GHG emissions.
The Cornerstones of CHAR ESG Reporting
Environmental
This initial commitment to ESG reporting endeavours to develop consistent climate-related financial risk and opportunity disclosures for our stakeholders. Since a key business focus for CHAR is the reduction and replacement of gases that contribute to the global human and financial risk of climate change, our positive contribution to mitigating the issue in a growing low-carbon economy is a material issue and therefore included in this ESG report. Our direct GHG impact based on current operations is very small in comparison to the net carbon benefit that our services and technologies provide to our customers.
CHAR is rapidly increasing its application development activities to offer technology products that consume less energy, emit fewer greenhouse gases, and provide significant and valuable net negative carbon benefit and offsets.
Social
As one of our most critical stakeholders, our employees are core to driving our business and innovation and live our values on a daily basis. CHAR’s aim is to support our employees through a diverse, inclusive and flexible workplace. Some of the key reasons for striving for continuous improvement in our Social component of our ESG plan are:
- Attract the best talent, through growth opportunities, financial stability, and our passion for contributing to our own clients’ environmental compliance and ESG goals.
- Provide an inclusive and collaborative work culture where absenteeism and turnover are reduced.
- Employee gender diversity, as a globally recognized avenue to enhancing growth & profits.
Governance
The CHAR Board of Directors comprises seven directors, all of whom are independent. Management (i.e., our CEO, CFO, and COO) reports to, but does not sit on, the Board of Directors. This helps to further maintain the Board’s independence. Energy conservation and climate change mitigation opportunities are inherently addressed by the Board in its strategic guidance to the Corporation, since our own core business lines and revenue growth pertain to those initiatives for our clients.
CHAR and its Board have a driving and overarching long-term strategic direction, to become a key supplier within the global low-carbon economy that includes the increased use of clean technology renewable fuels and environmental services. Short-term strategic planning by the Board focusses on how to best identify and fulfil the opportunities created by this material societal and financial shift.
Measuring ESG Performance and Developing Continuous Improvement Practices
Environmental
We currently measure our own direct greenhouse gas emissions (Scope 1 emissions, see “Key CHAR ESG Metrics” on page 16), which for our own operations is the calculated sum of greenhouse gas emissions generated from natural gas combustion (for example, the use of natural gas in our R&D systems).
Outputs from the CHAR high temperature pyrolysis technologies include proprietary biocarbon products, excess heat, and pyrolysis gas which can be then used to generate energy directly or upgraded to renewable natural gas or purified hydrogen. Hydrogen & RNG can both be used as direct replacements for fossil fuels.
We feel it’s important to distinguish between our carbon (GHG) emissions from fossil fuels, such as natural gas and fuels derived from biogenic sources as a result of running our installed systems, (i.e. from using syngas instead of natural gas to supply the systems’ thermal requirements). In future, our GHG reporting will distinguish between eCO2 emissions from fossil and biogenic fuel origins to illustrate the very real advantages of the high temperature pyrolysis process.
The biochar products produced from waste biomass by our technologies are also rich in carbon and can contribute significantly to global carbon sequestration.
In future, we plan to be able to measure and report on all GHG metrics of importance to our stakeholders: and measure the net GHG reductions generated by our technology installations for our clients through client use of renewable natural gas, hydrogen and/or biocoal, as well as the carbon sequestration benefits through various uses of biocarbon. The annual reporting total of Scope 1 and Scope 2 emissions will therefore be our net contribution to climate change caused by GHG emissions, which is expected to be increasingly negative (i.e., beneficial), as the number of installations of our technologies grows worldwide.
Social
CHAR encourages our employees to be actively involved in our local communities. CHAR leads by example, donating to both Swim, Drink, Fish as well as KidsAbility as part of our recent Christmas Spirit of Giving campaign. We continually engage with and support our academic partners, including the Institute for Chemicals and Fuels from Alternative Resources (ICFAR) at Western University, the University of Toronto, the University of Guelph, York University and others. Our engagement often includes interactions and support to students, allowing them to engage with a company commercializing a technology in their areas of research interest. Measuring the following will allow for continuous improvement in our Social component of our overall ESG commitment:
- Employee Satisfaction: Employee turnover ratio is often used as an indicator of employee satisfaction. As CHAR continues to grow as a corporation, we plan on measuring and reporting this ratio in this report and using the ratio for continuous improvement of our already advancing human resources initiatives.
- Customer retention: Client satisfaction can be gauged by the number of Clients retained in a period. CHAR is creating a baseline for this ratio and will be reporting in future ESG reports.
- Gender Diversity: Staff gender diversity has reportedly scientifically been shown to be correlated with better financial performance. CHAR tracks its gender diversity ratio and strives for continuous improvement, at or above competitive standards in our industry of technology development, product installations, and engineering services.
Governance
CHAR’s Board of Directors consists of highly qualified, experienced, and independent members who are actively engaged in the business. For a high growth business such as CHAR, one of the main indicators of that engagement and involvement is the high (96%) Board Meeting attendance rate. A high and sustained attendance rate is indicative of a connected, relevant, and valuable Board of Directors, and a culture of growth.