Speaker: Virginia Dundas, Head of Strategic Environment Programs, Sustainability at Ørsted, hosted by Fergal Byrne, Executive Producer, The Sustainability Agenda
As questions surrounding Scope 3 emissions are rising on the business agenda, understanding why and how we must address them is key to achieving decarbonization. With that in mind, we have launched a new podcast series featuring senior business and thought leaders who talk us through their experiences in tackling supply chain decarbonization.
Ørsted's Journey Towards Net Zero by 2040
A transformation from the most coal-intensive energy companies in Europe to one of the most sustainable ones in the energy sector has not been enough for Ørsted. The company has embarked on a journey toward net zero by 2040, aiming to tackle emissions along the entire value chain.
In the second episode of our podcast series, we talked with Virginia Dundas, Head of Strategic Environment Programs, Sustainability at Ørsted to learn more about how Ørsted is engaging suppliers and trading partners to reduce Scope 3 emissions.
Scope 3 Decarbonization at Ørsted: A Top Priority
As part of its Carbon Neutral Supply Chain 2040 Program by 2040, Ørsted has set two main goals: to achieve net zero in Scopes 1 and 2 by 2025 and in Scope 3 by 2040. Having already achieved an 87% reduction in Scopes 1 and 2, the 2040 Scope 3 goal is now a top priority for Ørsted as the company is looking to decarbonize the entire value chain.
Key Challenges in Tackling Scope 3 Emissions
This, however, Ørsted wants to be sure to tackle in a sustainable way – as was the case when the company revolutionized its business model to become one of the most sustainable companies in the world. And this is why it has decided to focus on emissions reduction rather than offsetting, having capped the emissions that can be offset to less than 10% of the residual emissions that may remain by 2040. This plan comes with three main challenges:
- Scope 3 emissions cannot be dealt with directly. Reducing them means working with suppliers and accepting the fact that you have less influential power.
- The vast majority of Ørsted’s Scope 3 emissions for Ørsted come from tier 2 and 3, particularly steel producers and the vessels used to install the wind turbines in the sea.
- Measuring emissions is a very complex task. It requires collaboration with peers within and across industries to agree on common measurement standards which can allow for comparison and benchmarking.
How Is Ørsted’s Program Tackling These Challenges?
To tackle these challenges, Ørsted has clearly focused its supplier decarbonization program. First of all, there is the collaboration with suppliers – from understanding their bottlenecks and pain points to providing the right tools and incentives to set SBTi standards. And then there is the collaboration with peers from within and outside the industry. This has allowed for more insight into tier 2 and 3 but Ørsted sees it as essential to agree on common measurement methods, which would promote benchmarking and incentivize upstream actors to work on their decarbonization. Together with peers Ørsted can have more influence on upstream suppliers which they would otherwise struggle to engage with. Tackling Scope 3 emissions is more effective when perceived as a shared ambition between a company and its suppliers rather than an imposition and Ørsted’s program is the living proof of that.
About the Speaker
Virginia Dundas is Head of Strategic Environment Programs in the Global Sustainability team at Ørsted.
She oversees Ørsted’s global decarbonization strategy and activities, including its Supply Chain Decarbonization Program, and coordinates the company’s efforts towards its 2040 net zero target. Prior to joining Ørsted she worked on a range of CSR and sustainability topics at transport and logistics companies DHL and Maersk. She holds a master’s degree from Copenhagen Business School and lives in Copenhagen.
About the Scope 3 Agenda Podcast Series
The Scope 3 Agenda Podcast is a monthly series produced by EcoVadis in collaboration with Fergal Byrne from The Sustainability Agenda featuring stories from senior business leaders working on supply chain decarbonization to reduce Scope 3 emissions across different industries. In the ten episodes we talk to business and thought leaders from a range of industries and explore strategies, challenges and lessons learned by companies who have embarked on a decarbonization journey.
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