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Separating Agency Progress from Posturing Around Carbon Reduction and Sustainability

Buyers
4
minutes
Technical Level
November 18, 2023
4
minutes
September 26, 2022
Technical Level
Frank Maguire
VP, Insight, Strategy & Sustainability

This article was originally featured on Digiday by Michael Bürgi and Antoinette Siu published on September 26th, 2022.

Maybe it’s because Climate Week took place last week, but the volume of sustainability-related news and announcements from agencies, marketers and ad-tech firms that flooded reporters’ inboxes the last two weeks has been almost overwhelming.

Could it be that the media world is finally taking concrete steps toward decarbonization — or will many of these efforts become the butt of a joke (or worse, the focus of an upcoming John Oliver segment)?

“There needs to be economic incentives, not just pure altruism, for companies to want to measure the carbon footprint of their digital advertising activity — and then take steps to reduce that,” said an executive at a company that’s devoted to helping digital marketers and media reduce their carbon footprint, who declined to speak on the record. “Our job would be really easy as a company if everyone actually was truly altruistic. But in the current [economic] climate, you don’t want to put your neck on the line to do something that could potentially negatively affect the bottom line of your business.”

Agencies don’t appear to be shy at all about the gains they say they’ve achieved already.

Just last week, Wendy Clark Dentsu International’s soon-to-depart global CEO, posted on LinkedIn that she was “so pleased and proud to share that Dentsu International has been independently verified as carbon neutral, achieving our Scope 1 and 2 objective of reducing absolute emissions by 53% (off our 2019 baseline) and exceeding our science-based 2030 target nine years ahead of plan. This plan also includes our investment in nature-based projects across EMEA, the Americas and APAC to compensate for our remaining scope 1 and 2 emissions. With this notable progress in our own operations, we are adding focus to our Scope 3 emissions, which include our supply chain and the products and services we market.”

(In case you’re not familiar with the 3 Scopes, here’s a quick YouTube video from Climate Now that explains them.)

It’s the Scope 3 part of the equation that’s going to determine if the digital media world can make a difference. A report released last week by ad platform Good-Loop, which surveyed 450 marketers and media agencies about the ad industry’s efforts to limit carbon emissions, started off by citing a BBC stat that says the Internet generates 4% of the world’s global emissions — a number that will double to 8% by 2025.

Ad exchange Sharethrough is one of many companies partnering with sustainability tools, such as Scope3 and Carbon Direct, in order to measure and act on their carbon emissions generated from the process. With carbon emissions solutions implemented this summer, Frank Maguire, vp of Insights at Sharethrough, told Digiday advertisers are already seeing better performance.

“The stat that really drove it home was that the emissions created from all the servers and everything it takes to surf all the web pages and videos and ads and everything across the Internet creates more carbon emissions than the aviation industry,” Maguire said.

Now advertisers can run this in their buying process to measure and offset their carbon emissions and invest a small amount back into carbon capture projects, Maguire explained, and about 1 million ad impressions is equivalent to 1 metric ton of carbon dioxide. Some of the CPM yield then gets invested into projects through Carbon Direct, so it’s a small cost to the advertiser. But those that are using it have seen their ads perform with a 22% higher click through rate, according to Sharethrough.

“I think that’s ultimately what’s going to drive the tech industry to eventually reach a larger scale of really doing a good job of reducing our carbon emissions is by those with the power to buy throwing their weight in the right way to push the whole industry to be more sustainable,” Maguire said. “It’s good that we’re not hiding our heads in the sand, now that we realize that we’re creating a problem.”

That’s happening across the media and marketing spectrum. Good-Loop found that while 61% of U.S. marketers are currently tracking the carbon cost of their digital marketing campaigns, 56% still rely on estimated figures or calculations for which there’s no standard measure.

And three-fourths of the respondents said the industry needs to do more to tackle carbon reduction. Further, 51% of respondents said their company plans to reach net zero in digital advertising at some point, but only 24% have set target dates and only 2% (like Dentsu) say they have already reached net zero.

But how can you actually know if you’re net zero if there’s no universally agreed-upon standard for measurement? “There is certainly a feeling of everyone wants to be different, and everyone wants to differentiate [from each other],” said the carbon-reduction executive. “I’m skeptical of all of them [the holding companies]. They all have fossil fuel companies still on their books.”

“What we first need is a standardized measurement framework to assess the pollution of digital media,” said Elisa Boivin, managing director of footsprint, the sustainability division of e-commerce performance agency the Labelium Group. “Efforts should be focused not on proprietary methodologies, but on a common foundation that all industry players can build on and be accountable for. Having a transparent and collaborative methodology is essential to driving change at industry level.

Can the agency holding companies and independents work together to create one standard? It’s too early to tell — but industry-wide efforts like AdNetZero are a step in the right direction. Alison Pepper, 4As’ executive vp of government relations and sustainability, said credit must be given to the holding companies for the progress they have made. “The holding companies have got a good handle on where they are on Scope 1 and Scope 2 emissions, and they have an understanding of what needs to happen by a reduction in offsets,” said Pepper. “Now you’re seeing them turn their attention to the media side.”

For example, Pepper points to efforts like GroupM’s decarbonization measurement initiative unveiled a few months ago establishes a floor from which to push off to reduce the impact of Scope 3 emissions. “If we get to a place in the advertising community where we can at least agree on the floor, that would be a really important step. And if agencies, advertisers, publishers, ad tech platforms all decide individually to commit resources to go beyond, I’m confident that we can at least get to standardization — and then individual companies can take it to the ceiling.”

To that end, GroupM agency Essence in the U.K. just announced it will apply the mothership’s decarbonization framework to its programmatic practice, in the hopes of reducing the carbon footprint of advertising campaigns, and rewarding publishers that address climate crisis issues in their editorial coverage.

One potential curveball to progress made, at least on the marketing side, according to Pepper, is the Federal Trade Commission unofficially stated intent to revise its Green Guides, which is expected to be a two-year process that when completed will stand for another 10 years, she said. “That’s something that I’m working with agencies on right now to help them understand what that process will entail and how they’ve evolved. They haven’t touched those guides in 10 years, so they’re going to be significantly updated.”

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This article was originally featured on Digiday by Michael Bürgi and Antoinette Siu published on September 26th, 2022.

Maybe it’s because Climate Week took place last week, but the volume of sustainability-related news and announcements from agencies, marketers and ad-tech firms that flooded reporters’ inboxes the last two weeks has been almost overwhelming.

Could it be that the media world is finally taking concrete steps toward decarbonization — or will many of these efforts become the butt of a joke (or worse, the focus of an upcoming John Oliver segment)?

“There needs to be economic incentives, not just pure altruism, for companies to want to measure the carbon footprint of their digital advertising activity — and then take steps to reduce that,” said an executive at a company that’s devoted to helping digital marketers and media reduce their carbon footprint, who declined to speak on the record. “Our job would be really easy as a company if everyone actually was truly altruistic. But in the current [economic] climate, you don’t want to put your neck on the line to do something that could potentially negatively affect the bottom line of your business.”

Agencies don’t appear to be shy at all about the gains they say they’ve achieved already.

Just last week, Wendy Clark Dentsu International’s soon-to-depart global CEO, posted on LinkedIn that she was “so pleased and proud to share that Dentsu International has been independently verified as carbon neutral, achieving our Scope 1 and 2 objective of reducing absolute emissions by 53% (off our 2019 baseline) and exceeding our science-based 2030 target nine years ahead of plan. This plan also includes our investment in nature-based projects across EMEA, the Americas and APAC to compensate for our remaining scope 1 and 2 emissions. With this notable progress in our own operations, we are adding focus to our Scope 3 emissions, which include our supply chain and the products and services we market.”

(In case you’re not familiar with the 3 Scopes, here’s a quick YouTube video from Climate Now that explains them.)

It’s the Scope 3 part of the equation that’s going to determine if the digital media world can make a difference. A report released last week by ad platform Good-Loop, which surveyed 450 marketers and media agencies about the ad industry’s efforts to limit carbon emissions, started off by citing a BBC stat that says the Internet generates 4% of the world’s global emissions — a number that will double to 8% by 2025.

Ad exchange Sharethrough is one of many companies partnering with sustainability tools, such as Scope3 and Carbon Direct, in order to measure and act on their carbon emissions generated from the process. With carbon emissions solutions implemented this summer, Frank Maguire, vp of Insights at Sharethrough, told Digiday advertisers are already seeing better performance.

“The stat that really drove it home was that the emissions created from all the servers and everything it takes to surf all the web pages and videos and ads and everything across the Internet creates more carbon emissions than the aviation industry,” Maguire said.

Now advertisers can run this in their buying process to measure and offset their carbon emissions and invest a small amount back into carbon capture projects, Maguire explained, and about 1 million ad impressions is equivalent to 1 metric ton of carbon dioxide. Some of the CPM yield then gets invested into projects through Carbon Direct, so it’s a small cost to the advertiser. But those that are using it have seen their ads perform with a 22% higher click through rate, according to Sharethrough.

“I think that’s ultimately what’s going to drive the tech industry to eventually reach a larger scale of really doing a good job of reducing our carbon emissions is by those with the power to buy throwing their weight in the right way to push the whole industry to be more sustainable,” Maguire said. “It’s good that we’re not hiding our heads in the sand, now that we realize that we’re creating a problem.”

That’s happening across the media and marketing spectrum. Good-Loop found that while 61% of U.S. marketers are currently tracking the carbon cost of their digital marketing campaigns, 56% still rely on estimated figures or calculations for which there’s no standard measure.

And three-fourths of the respondents said the industry needs to do more to tackle carbon reduction. Further, 51% of respondents said their company plans to reach net zero in digital advertising at some point, but only 24% have set target dates and only 2% (like Dentsu) say they have already reached net zero.

But how can you actually know if you’re net zero if there’s no universally agreed-upon standard for measurement? “There is certainly a feeling of everyone wants to be different, and everyone wants to differentiate [from each other],” said the carbon-reduction executive. “I’m skeptical of all of them [the holding companies]. They all have fossil fuel companies still on their books.”

“What we first need is a standardized measurement framework to assess the pollution of digital media,” said Elisa Boivin, managing director of footsprint, the sustainability division of e-commerce performance agency the Labelium Group. “Efforts should be focused not on proprietary methodologies, but on a common foundation that all industry players can build on and be accountable for. Having a transparent and collaborative methodology is essential to driving change at industry level.

Can the agency holding companies and independents work together to create one standard? It’s too early to tell — but industry-wide efforts like AdNetZero are a step in the right direction. Alison Pepper, 4As’ executive vp of government relations and sustainability, said credit must be given to the holding companies for the progress they have made. “The holding companies have got a good handle on where they are on Scope 1 and Scope 2 emissions, and they have an understanding of what needs to happen by a reduction in offsets,” said Pepper. “Now you’re seeing them turn their attention to the media side.”

For example, Pepper points to efforts like GroupM’s decarbonization measurement initiative unveiled a few months ago establishes a floor from which to push off to reduce the impact of Scope 3 emissions. “If we get to a place in the advertising community where we can at least agree on the floor, that would be a really important step. And if agencies, advertisers, publishers, ad tech platforms all decide individually to commit resources to go beyond, I’m confident that we can at least get to standardization — and then individual companies can take it to the ceiling.”

To that end, GroupM agency Essence in the U.K. just announced it will apply the mothership’s decarbonization framework to its programmatic practice, in the hopes of reducing the carbon footprint of advertising campaigns, and rewarding publishers that address climate crisis issues in their editorial coverage.

One potential curveball to progress made, at least on the marketing side, according to Pepper, is the Federal Trade Commission unofficially stated intent to revise its Green Guides, which is expected to be a two-year process that when completed will stand for another 10 years, she said. “That’s something that I’m working with agencies on right now to help them understand what that process will entail and how they’ve evolved. They haven’t touched those guides in 10 years, so they’re going to be significantly updated.”

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About Behind Headlines: 180 Seconds in Ad Tech—

Behind Headlines: 180 Seconds in Ad Tech is a short 3-minute podcast exploring the news in the digital advertising industry. Ad tech is a fast-growing industry with many updates happening daily. As it can be hard for most to keep up with the latest news, the Sharethrough team wanted to create an audio series compiling notable mentions each week.

This article was originally featured on Digiday by Michael Bürgi and Antoinette Siu published on September 26th, 2022.

Maybe it’s because Climate Week took place last week, but the volume of sustainability-related news and announcements from agencies, marketers and ad-tech firms that flooded reporters’ inboxes the last two weeks has been almost overwhelming.

Could it be that the media world is finally taking concrete steps toward decarbonization — or will many of these efforts become the butt of a joke (or worse, the focus of an upcoming John Oliver segment)?

“There needs to be economic incentives, not just pure altruism, for companies to want to measure the carbon footprint of their digital advertising activity — and then take steps to reduce that,” said an executive at a company that’s devoted to helping digital marketers and media reduce their carbon footprint, who declined to speak on the record. “Our job would be really easy as a company if everyone actually was truly altruistic. But in the current [economic] climate, you don’t want to put your neck on the line to do something that could potentially negatively affect the bottom line of your business.”

Agencies don’t appear to be shy at all about the gains they say they’ve achieved already.

Just last week, Wendy Clark Dentsu International’s soon-to-depart global CEO, posted on LinkedIn that she was “so pleased and proud to share that Dentsu International has been independently verified as carbon neutral, achieving our Scope 1 and 2 objective of reducing absolute emissions by 53% (off our 2019 baseline) and exceeding our science-based 2030 target nine years ahead of plan. This plan also includes our investment in nature-based projects across EMEA, the Americas and APAC to compensate for our remaining scope 1 and 2 emissions. With this notable progress in our own operations, we are adding focus to our Scope 3 emissions, which include our supply chain and the products and services we market.”

(In case you’re not familiar with the 3 Scopes, here’s a quick YouTube video from Climate Now that explains them.)

It’s the Scope 3 part of the equation that’s going to determine if the digital media world can make a difference. A report released last week by ad platform Good-Loop, which surveyed 450 marketers and media agencies about the ad industry’s efforts to limit carbon emissions, started off by citing a BBC stat that says the Internet generates 4% of the world’s global emissions — a number that will double to 8% by 2025.

Ad exchange Sharethrough is one of many companies partnering with sustainability tools, such as Scope3 and Carbon Direct, in order to measure and act on their carbon emissions generated from the process. With carbon emissions solutions implemented this summer, Frank Maguire, vp of Insights at Sharethrough, told Digiday advertisers are already seeing better performance.

“The stat that really drove it home was that the emissions created from all the servers and everything it takes to surf all the web pages and videos and ads and everything across the Internet creates more carbon emissions than the aviation industry,” Maguire said.

Now advertisers can run this in their buying process to measure and offset their carbon emissions and invest a small amount back into carbon capture projects, Maguire explained, and about 1 million ad impressions is equivalent to 1 metric ton of carbon dioxide. Some of the CPM yield then gets invested into projects through Carbon Direct, so it’s a small cost to the advertiser. But those that are using it have seen their ads perform with a 22% higher click through rate, according to Sharethrough.

“I think that’s ultimately what’s going to drive the tech industry to eventually reach a larger scale of really doing a good job of reducing our carbon emissions is by those with the power to buy throwing their weight in the right way to push the whole industry to be more sustainable,” Maguire said. “It’s good that we’re not hiding our heads in the sand, now that we realize that we’re creating a problem.”

That’s happening across the media and marketing spectrum. Good-Loop found that while 61% of U.S. marketers are currently tracking the carbon cost of their digital marketing campaigns, 56% still rely on estimated figures or calculations for which there’s no standard measure.

And three-fourths of the respondents said the industry needs to do more to tackle carbon reduction. Further, 51% of respondents said their company plans to reach net zero in digital advertising at some point, but only 24% have set target dates and only 2% (like Dentsu) say they have already reached net zero.

But how can you actually know if you’re net zero if there’s no universally agreed-upon standard for measurement? “There is certainly a feeling of everyone wants to be different, and everyone wants to differentiate [from each other],” said the carbon-reduction executive. “I’m skeptical of all of them [the holding companies]. They all have fossil fuel companies still on their books.”

“What we first need is a standardized measurement framework to assess the pollution of digital media,” said Elisa Boivin, managing director of footsprint, the sustainability division of e-commerce performance agency the Labelium Group. “Efforts should be focused not on proprietary methodologies, but on a common foundation that all industry players can build on and be accountable for. Having a transparent and collaborative methodology is essential to driving change at industry level.

Can the agency holding companies and independents work together to create one standard? It’s too early to tell — but industry-wide efforts like AdNetZero are a step in the right direction. Alison Pepper, 4As’ executive vp of government relations and sustainability, said credit must be given to the holding companies for the progress they have made. “The holding companies have got a good handle on where they are on Scope 1 and Scope 2 emissions, and they have an understanding of what needs to happen by a reduction in offsets,” said Pepper. “Now you’re seeing them turn their attention to the media side.”

For example, Pepper points to efforts like GroupM’s decarbonization measurement initiative unveiled a few months ago establishes a floor from which to push off to reduce the impact of Scope 3 emissions. “If we get to a place in the advertising community where we can at least agree on the floor, that would be a really important step. And if agencies, advertisers, publishers, ad tech platforms all decide individually to commit resources to go beyond, I’m confident that we can at least get to standardization — and then individual companies can take it to the ceiling.”

To that end, GroupM agency Essence in the U.K. just announced it will apply the mothership’s decarbonization framework to its programmatic practice, in the hopes of reducing the carbon footprint of advertising campaigns, and rewarding publishers that address climate crisis issues in their editorial coverage.

One potential curveball to progress made, at least on the marketing side, according to Pepper, is the Federal Trade Commission unofficially stated intent to revise its Green Guides, which is expected to be a two-year process that when completed will stand for another 10 years, she said. “That’s something that I’m working with agencies on right now to help them understand what that process will entail and how they’ve evolved. They haven’t touched those guides in 10 years, so they’re going to be significantly updated.”

About Calibrate—

Founded in 2015, Calibrate is a yearly conference for new engineering managers hosted by seasoned engineering managers. The experience level of the speakers ranges from newcomers all the way through senior engineering leaders with over twenty years of experience in the field. Each speaker is greatly concerned about the craft of engineering management. Organized and hosted by Sharethrough, it was conducted yearly in September, from 2015-2019 in San Francisco, California.

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Frank Maguire
VP, Insight, Strategy & Sustainability

About the Author

Frank has spent over a decade at Sharethrough conducting research to better understand how humans respond to advertising to help brands and agencies adapt their unique advertising challenges to ever-evolving media consumption behaviors. In order to accelerate sustainability initiatives at Sharethrough and across the advertising industry, he recently completed his “Sustainability in Business” certification from Harvard Business School. He has also led multiple sustainability initiatives, including helping to launch the ad industry’s first Green Media Product “GreenPMPs,” hosting the advertising industry’s first Green Media Summit and speaking at Climate Week NYC. He is a digital advertising industry veteran, beginning his career working for clients including Nestle, Pfizer and Wyndham on the agency side and then opening up and growing Sharethrough’s East Coast headquarters in NYC.

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