Hot Air, or Cool Progress?

A year ago, the white paper, 'Cash: A Roadmap to Sustainability', recorded a pleasing level of activity and progress across the cash industry on environmental sustainability, with plenty of evidence of organisations striving and achieving to do better.

In 2022 sustainability reports abound, whilst the risk of greenwashing feels high. So, what was learnt at November's inaugural Cash & Payments Sustainability Forum in Edinburgh?

The voice of the industry

On the manufacturing side, if you listened to the presentations from Oberthur Fiduciaire, CCL Secure or Komori, they were rich with examples of big and small changes which are making measurable differences.

The Royal Mint and the Royal Canadian Mint, while providing concrete examples of projects generating real change, put these in the context of their broad Environment, Social and Governance (ESG) programmes.

Loomis and the UK’s Cash Industry Environmental Charter (CIEC) group laid out the challenges of the cash cycle. Loomis demonstrated the breadth of work it is doing and the real change that is possible. The CIEC showed just what can be achieved through end-to-end cooperation, but also that it is the detail that delivers the benefits.

Some organisations are rethinking how things are done – Giesecke+Devrient with its Green Banknote and Cash Cycle initiatives, Koenig & Bauer Banknote Solutions looking at power of data in the cash cycle (see pages 5-7).

As sustainability work becomes ‘reportable’ and part of the communication programme of organisations, it can feel ‘top down.’ So, it was refreshing to hear examples of organisations actively seeking staff input. Vaultex, G+D and Oberthur all spoke about programmes to do this, with Vaultex’s Green Path perhaps the most systematic approach, with strong examples of projects being implemented.

Greenwashing? No. Energy and activity levels? High. Progress? Yes.

Central bank activity and initiatives

The Dutch National Bank (DNB) has re-worked its 2015 Life Cycle Analysis and concluded that cash has an environmental impact about five times that of a debit card payment, albeit the overall impact is still very small. 2019 data shows a major reduction compared with 2015 and the DNB believes that this can fall further.

The European Central Bank (ECB) is putting sustainability at the heart of its work on Euro Series 3. It has carried out a Product Environment Footprint (PEF) based on 2019 production and circulation and is using this as a base year against which to assess every design and feature recommendation for ES3.

DNB is one of the few central banks that includes sustainability measures in the award of tenders for banknote procurement. This has worked well, albeit based on narrow criteria. DNB explained its plans to broaden the measures and to delve deeper into supplier calculations.

FedCash® Services reported on its work to make the cash cycle more efficient with the introduction of its E-Manifest service based on GS1, as part of its Cash Visibility program, while the use of landfill for shredded unfit notes has been eliminated in all but two of the 28 currency offices.

Greenwashing? No! These central banks are examples of using measurement to drive change and targeted, specific programmes across design, procurement and the cash cycle.

Fresh thinking and insight from outside of the industry

Talk of moving to 100% renewable energy is widespread, and not just in this industry. Google claims to have been doing this since 2007, for example. We learned that the risk of greenwashing is high.

Dr Matthew Brander from the University of Edinburgh Business School explained the two methods of calculating grid electricity, the locational grid average and the market-based method where organisations have a contractual arrangement based on Renewable Energy Certificates (REC), Guarantees of Origin or other contracts.

If organisations use the market-based method and the renewable energy project existed without the company buying the REC, then the purchase has not added to the stock of renewables. Known as additionality, without proof of it the risk of greenwashing is significant.

npower, part of the European energy giant E.On, gave practical advice and thinking about getting to net zero emissions, including a good summary of possible technologies to assist with this.

THG Eco explained how to buy carbon credits ethically, with confidence and at the right price.

Hot air?

There is hot air about (both literally and figuratively). You need to ask the right questions to understand what is happening. Metrics matter, but so do the methodologies used. While capital projects make headlines, progress is also achieved by lots of small, detailed pieces of work which are less eye catching but nevertheless significant.

A full review of the Cash & Payments Sustainability Forum can be found in Currency News™ sister publication Cash & Payment News™.