Shopify is a popular e-commerce platform that allows merchants sell their products. However, its focus is not just commercial but also creating a sustainable environment. On its website, the Canada-based e-commerce giant states: “Shopify brings merchants, customers, and climate entrepreneurs together in the fight against climate change”.
Sustainable Commerce
Shopify constantly works to empower a sustainable commerce by helping Shopify merchants neutralise shipping emissions. For this, Shopify has partnered with experts to develop high-leverage projects like Shop Pay. Explaining how it works, the website states: “Every time a customer places an order using Shop Pay, Shopify funds carbon removal to counteract the impact on the planet at no extra cost”.
In its bid against carbon, Shopify has pledged to purchase carbon removal during the Black Friday Cyber Monday (BFCM) to reduce shipping emissions from every single order placed during the busiest shopping season. In the last two years, Shopify had offset a total of over 120,000 tonnes of carbon.
Reaching net zero emissions is key to building environmental resilience and to realizing a future that delivers sustainable and inclusive growth. Carbon removals have an essential role to play.
Dickon Pinner, Senior Partner Dickon Pinner, McKinsey
McKinsey Partnership
Recently, Shopify partnered with McKinsey Sustainability to develop permanent carbon removal technologies. The global management consulting firm has generated a $925 million fund for an eight-year advanced market commitment (AMC), thanks to Shopify, Alphabet, Meta and Stripe. The joint venture is named ‘Frontier’. The new technology aims to reduce competition in the carbon removal industry and expand its global supply.
“Reaching net zero emissions is key to building environmental resilience and to realizing a future that delivers sustainable and inclusive growth. Carbon removals have an essential role to play,” McKinsey Senior Partner Dickon Pinner said in a statement.
“Frontier will play a catalytic role in enabling the supply of high-quality carbon removals,” Pinner added.
McKinsey Platform for Climate Technologies
Shopify’s partnership with McKinsey has come in line with the McKinsey Platform for Climate Technologies, a McKinsey Sustainability initiative for a sustainable future. Explaining the platform, the company writes: “MPCT focuses on helping clients plan, execute and scale net-zero technologies in recognition of this urgent call to action. And while we have prioritized helping clients achieve net zero emissions, we’re also deeply committed to it ourselves. Last year, we pledged to achieve net-zero climate impact as a firm by 2030”.
Renewable Power
Shopify also generates renewable power using wind energy to power 100 percent of its employee home offices across North America. It recently developed a wind farm that claims to be the country’s most carbon-intensive energy grid.
Carbon Neutrality
Shopify uses a completely carbon-neutral platform for its data servers. In 2018, the company decommissioned all of its data servers to shift entirely to Google Cloud. “Google matches 100% of the energy consumed by Google Cloud with renewable energy, enabling us to run a completely carbon-neutral platform,” the company says.
No Carbon Emission
Talking about the company, you would be surprised to know that in 2019, “Shopify began sourcing renewable power for heating, cooling, and powering our buildings and employee home offices. We’ve procured enough green energy to account for our natural gas and electricity-related carbon footprint in Canada. For travel-related emissions, which are 5x our operational footprint, we purchase verified carbon offsets”.
Sustainable Tea
Not only Shopify but its employees have also developed a sense of saving earth. Shopify President Harley Finkelstein sells tea under the brand name ‘Firebelly Tea’. Recently, he cherished nine months of his entrepreneurial journey in a LinkedIn Post.
“Nine months ago, I became an entrepreneur again – and it feels damn good. Why? As the President of Shopify, the best way for me to understand what our merchants are experiencing today as they build their businesses is to be an entrepreneur alongside them,” Finkelstein wrote.
“For a year, we product tested, designed tea accessories and packaging, built our site and our brand. Finally, in November 2021 we launched Firebelly Tea on Shopify. We are nine months in, and it’s been one hell of a ride so far. But I can tell you one thing – we are just getting started. If you want to see what we’ve built, check out what’s brewing,” he added.
When we visit Finkelstein’s shop, it reveals how Firebelly Tea is avoiding carbon footprints. The brand claims that all the ingredients used in its products are naturally produced with no artificial sweeteners, flavouring or sugar. “The reason we’re able to use compostable resealable tea packaging (and a lot of other tea companies can’t) is because we don’t have any flavourings, artificial or otherwise. Flavourings in general interfere with the eco friendly glues,” the website states.
Firebelly Tea comes in a sustainable packaging and ensures fast delivery to reduce carbon emission. The tea pouches are resealable and can be converted into compost within one year using the home’s garden. Firebely adds: “The resealable pouches that our teas come in are home compostable and will degrade in your garden’s compost area within one year (faster if you want to send them to your city’s industrial composting centres).”
Al Gore’s Big Bet
Shopify’s intention for the mother earth has helped it get big investors too. Recently, Generation Investment Management, co-founded by former vice president Al Gore, made a big bet on Shopify. It bought 7.5 million shares of SHOP worth approximately $234 million. For the unversed, Generation Investment Management is known for its ventures related to environmental, social and governance (ESG). Al Gore’s firm seems to be impressed with Shopify.
“[Shopify] continues to invest in tools that would attract more merchants to its platform over the long term. This includes the Shopify Fulfillment Network (SFN), Shopify Payments, Shopify Editions and Shopify Markets,” Sirisha Bhogaraju, InvestorPlace contributor, commented on Shopify’s future.
