We’ve been measuring carbon for years. Why aren’t we further ahead?

Carbon reporting across the food industry has never been better. More

businesses than ever are measuring their emissions, publishing their footprints, and setting reduction targets. Scrutiny from investors, retailers, and regulators is increasing. And yet, emissions across the food system are not falling fast enough.

So what’s going wrong?

That’s the question at the heart of our new report, Why Decarbonisation Drives Value. The answer, we argue, is not a lack of ambition or data. It’s a structural failure: carbon has become something organisations measure and disclose, but not something they systematically manage.

We call this the ‘decarbonisation delivery gap’.

Reporting isn’t the same as managing

Over the past decade, carbon reporting has matured rapidly. Emissions are calculated, audited, disclosed, and compared against targets. For many businesses, this progress is presented as evidence of action. In reality, it tells stakeholders what happened last year, but doesn't tell anyone how to do better.

The reason is structural. Carbon reporting today closely resembles statutory financial accounting – necessary, standardised, and externally focused. Like statutory accounts, it tells stakeholders what has already happened, but offers limited insight into how to improve future performance.

What drives business performance is management accounting: data broken down by product, site, customer, and process; linked to activity; revealing inefficiency; supporting prioritisation. Carbon monitoring needs to make the same shift – from measurement to management.

Until it does, organisations will remain trapped in a familiar loop: measure, report, re-measure, re-report. That is not progress. It is repetition.

A different way of looking at carbon

Our report proposes a reframe. Carbon emissions are not simply an environmental impact – they are a signal of operational inefficiency. Carbon accumulates where processes consume more energy, materials, or movement than they need to. Where emissions are high, value is often being lost.

This is not a new idea in business. Lean and Six Sigma transformed cost, quality, and productivity by making inefficiency visible inside everyday processes. Energy was once treated as an external cost to be negotiated; Lean thinking turned it into a signal of poor process design. Decarbonisation is now at the same stage.

When carbon is viewed through this lens, the question changes. Instead of asking “Are we reporting carbon correctly?”, forward-looking organisations ask: “Where is carbon helping us see where value is being lost – and how do we act on it?”

What the numbers actually show

Traditional carbon metrics measure the total volume of emissions a business produces. A large business will almost always produce more emissions in absolute terms than a smaller one, regardless of how efficiently it operates. That makes it difficult to know whether a business is genuinely improving, or simply appearing to improve because it has contracted or changed mix.

To address this, we developed the Aethr Carbon Value Metric (ACVM). ACVM links operational emissions directly to Gross Value Added (GVA) – measuring carbon emissions against the economic value a business creates – to compare which organisations generate more value for every tonne of carbon emitted. When emissions fall and value creation rises, the ACVM improves, giving a clear signal of real progress.

To illustrate the metric, we applied the ACVM to publicly available data from nine UK food retailers: Tesco, Sainsbury’s, Asda, Morrisons, M&S, Aldi, the Co-op, John Lewis Partnership, and Lidl, across 2022, 2023, and 2024.

Food retail was chosen because it is one of the few parts of the food system where public reporting is sufficiently consistent to illustrate the metric at sector level. The results are not a ranking – structural differences between businesses mean direct comparisons must be treated with caution. But the year-on-year trends within each business tell a revealing story about the pace and consistency of progress.

What the analysis shows is that the variation in how well carbon is being managed across the sector is considerable – and that conventional reporting simply doesn’t make that visible.

“Our clients wanted a way to compare the impact of their decarbonisation activities with others in the industry. We can see improved margins and we can see carbon reduction – but what hasn’t been visible before is whether one is actually masking the other.”

-          Richard Bonn, Co-Founder, Aethr Associates

What good looks like

The relationship between carbon reduction and value creation is not theoretical. Across the retail sector, operational changes that reduce emissions have consistently delivered measurable cost savings alongside, suggesting the opportunity to act is already there for many businesses.

The report includes detailed examples from the UK’s major retailers – from logistics optimisation at Tesco to heat-recovery systems at Sainsbury’s – where decarbonisation actions have delivered quantified financial returns alongside emissions reductions. The full detail is in the paper.

“Where emissions are high, value is often being lost,” says Bonn. “When carbon efficiency improves, businesses see gains in cost control, resilience, and margin. It’s not about the boldest targets; it’s having the best operational discipline.”

From measurement to management: the LeanGreen approach

Decarbonisation fails when the focus is on reporting rather than management. Aethr’s response is LeanGreen™, an approach that treats carbon waste the same way businesses have treated operational waste for decades: as something to be mapped, owned, measured, and systematically removed.

LeanGreen extends Lean and continuous improvement thinking into the carbon domain. It is not a sustainability programme – it is a performance system, embedding carbon reduction into day-to-day management through a simple operating cycle: Measure, Analyse, Deliver.

In practice, many organisations stall at measurement, undertake limited analysis, and struggle to convert insight into action. LeanGreen is designed to close that gap – turning decarbonisation from an annual reporting exercise into a continuous performance discipline.

The window is narrowing

Regulatory scrutiny of corporate carbon performance is tightening. Scope 3 emissions – those generated across the supply chain rather than within a company’s own operations – are expected to face greater disclosure requirements in the near term. For food businesses, where Scope 3 typically represents the largest share of the total footprint, the ability to demonstrate credible, value-linked progress means the gap between those with real delivery capability and those without is already opening up.

The organisations that will be best positioned are those that start now – not waiting for requirements to land, but building the measurement, management, and delivery capability that makes credible progress possible.

“The organisations that will be best positioned as requirements tighten are those that start treating carbon like cost: something to be managed, governed, and improved, not just reported,” says Bonn. “Decarbonisation is not a trade-off between sustainability and profitability. When it is managed properly, it drives both.”

Read the full report

If you want to go deeper into the ACVM methodology, the retail analysis, and the LeanGreen framework, download the full report: Why Decarbonisation Drives Value

Or, if you’d like to explore how the ACVM could be applied to your organisation, or how LeanGreen could support your decarbonisation delivery, visit our Sustainable Transformation page or get in touch directly.