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Climate Club raises $6.5m to engage employees in climate action

© Shutterstock / Sergei ElaginPost Thumbnail

New York-based Climate Club has raised $6.5 million to expand its carbon management platform, which helps companies to drive employee participation towards achieving their sustainability goals. 

  • Climate Club’s enterprise platform enables companies to develop and measure carbon reduction plans that transcend departmental silos and involve individual employees across their business. 
  • Engaging employees in sustainability measures not only helps to reduce carbon emissions, but can also increase financial returns through increased employee retention, operational resource savings and reputational improvement. 
  • Platforms that enable individual engagement could be useful in meeting company-specific goals, but the global transition will depend on far greater collaboration between a range of societal institutions. 

The investment from Climate Club’s seed round, led by XYZ Venture Capital and Vestigo Ventures, will be used to fund its official launch and continued global expansion.  

Its solution, which has already been deployed by major companies including Meta (NASDAQ:META) and Bain & Company, helps large enterprises decentralise their carbon reduction strategies and maximise the collaborative involvement of every department, team and employee. 

Companies can develop role-specific carbon reduction plans for each employee, track progress on an individual, team or departmental basis, and visualise consolidated measurement data in real-time. Predictive analytics enable them to identify priority areas, generate tailored guidance for ongoing strategic development and simulate the potential impact of different strategies. 

Such granular tracking means companies can incentivise employees with rewards and recognition of their efforts, and generate reports that are aligned with industry-standard frameworks. Climate Club has has also partnered with the likes of Lyft (NASDAQ:LYFT) and Google Nest (NASDAQ:GOOG) to support its clients in launching company-wide programmes to reduce their transport emissions and improve energy efficiency. 

Adam Braun, CEO and co-founder of Climate Club, said, “too often, corporate sustainability programs are limited to purchasing clean energy and buying offsets. Those centralized actions leave out the organization’s most powerful component — its people. People-powered carbon reduction means that every employee is engaged in the journey to Net Zero”. 

“There’s no team better equipped than Climate Club’s to take this all-hands-on-deck approach to meet corporate carbon reduction goals. It will truly take the collective village to reverse climate change, and Climate Club will be an essential tool for sustainability leaders and companies to deliver on their commitments.”, adds XYZ Venture Capital partner Chauncey Hamilton. 

Engaging employees in corporate sustainability strategies 

Although an increasing number of companies are developing sustainability strategies and emissions reduction targets, their effective delivery will depend on the employees whose day-to-day decisions and behaviours define how business operations play out in the real world. 

As such, the traditional top-down implementation of sustainability strategies is unlikely to drive company-wide transformation without the commitment and focus of individual employees.

With most large enterprises being set up to operate in silos, such engagement can be difficult to achieve, as departmental boundaries stand in the way of knowledge-sharing, internal collaboration and broader organisational learning. 

Sustainability strategies that transcend these boundaries can drive emissions reduction throughout a company’s operations by engaging active participants in departments ranging from procurement to events management, investor relations to brand partnerships and so on. 

There are widespread benefits to an ESG strategy

In addition to lowering a company’s carbon footprint, such broad organisational efforts can also maximise cost savings through waste reduction or improvements in energy efficiency. These improvements can also enhance the business’s reputation, allowing it to gain competitive advantage among conscious consumers and investors. 

Furthermore, with a 2017 study from the National Environmental Education Foundation finding that almost 90% of employees experienced greater job satisfaction when engaged in their company’s sustainability initiatives, organisations can make further savings by increasing their employee retention rate. 

Indeed, employee engagement is increasingly driven by moral values, with Deloitte’s 2021 Millennial and Gen Z Survey finding that 49% of people aged between 18 and 25 would select their employer based on personal ethics. Further research suggests that establishing sustainability as a shared value within an organisation empowers employees with a sense of psychological ownership that increases their motivation to take meaningful action. 

Who is responsible for corporate sustainability strategies? 

There is a clear business case for the implementation of ESG strategies, as they become increasingly important to investors, regulators and consumers alike. 

Driven by the need to manage material risks, comply with regulation and provide transparent reports, ESG strategies are typically considered a governance or board issue. The direct action required to actually implement ESG strategies and the company-wide transformation they enable, however, are rarely in the hands of leadership teams. 

Cross-functional operational roles, spanning all areas of the business, are crucial in enabling businesses to meet their sustainability targets. Each individual holds different knowledge and experience that can contribute to a company’s efforts, but only if they are able to connect and communicate with the organisation as a whole. 

Climate Club provides a potential solution, but this shared responsibility must go beyond the enterprise level to include the investors, regulators and consumers that provide the pressure and the conditions through which organisational transformation can be achieved. Although the support of these actors could be gained through Climate Club’s reporting capabilities, it will be important that stakeholders do not divert their attention from efforts to address the external impacts of company value chains. 

Ultimately, organisational change may well be enabled by collaborative platforms like Climate Club, but barriers within individual companies should not be replaced by barriers between them and the external societal institutions with the power to deliver wider, systemic transformation. 

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