Tackling Scope 3 Reductions on the Road to Net Zero Emissions

April 27, 2021 EcoVadis ‏‏‎

This year’s Sustain 2021 event could have been 100% about Covid-related social and economic impacts in the supply chain. But, it was clear from the attendance and response to our “Road to Net Zero” panel discussion, that Climate scope 3 emissions reductions are still top of mind for corporate execs -- and their stakeholders.  

It doesn’t hurt that business leaders like Bill Gates and Larry Fink have kept climate action on top of their corporations’ agendas. With COP26 on the horizon where the Paris agreement will be renewed, there is a growing realization -- not only among company CEOs but also their investors and customers -- that as much as 90% of a company’s environmental impact may be caused by the supply chain, putting people, communities, and brand reputation at risk. 

But even climate leaders are realizing the challenges of transitioning from predictive models to measured progress on reductions. This means engaging, educating and empowering their supply partners to reduce emissions, across diverse and globally dispersed value chains.

We are pleased to see our customers prioritizing Scope 3 reductions and looking for solutions to help them in their decarbonization journeys. At Sustain 2021, we heard from four industry leaders who shared their best practices for engaging suppliers through meaningful and scalable emission reductions. Here are key takeaways from their insights to help you in your decarbonization journey.

 

“Sustainability Can’t Be an Afterthought”
Gulia Stellari, Director, Sustainable Sourcing, Digital and Carbon Solutions, Unilever

Unilever’s Guila Stellari so aptly pointed out: Your Scope 3 emissions are someone else’s Scope 1 and 2. This is why sustainability must be a topic that is discussed with suppliers at the beginning stages of any partnership. Unilever set ambitious climate targets for itself – goals include a 50% reduction in the company’s end-to-end greenhouse gas footprint, using 100% renewable energy by 2030, and going net-zero by 2039. To achieve these goals, Unilever asks its suppliers to set SBTi targets and to be transparent in their greenhouse gas reporting. As a consumer goods company, collaborating with its partners is important for Unilever to report the carbon footprint of all products it sells to its customers. If Unilever’s suppliers are unable to share their greenhouse gas footprint and provide transparency in the materials that they sell, then Unilever is unable to pass that transparency on to its consumers.

 

“Turn Ambitions Into Action”
Ralf Peters, VP of Procurement, Coca-Cola European Partners

Coca-Cola European Partners wants to reduce its overall GHG emissions by 30%. In order to hit this ambitious goal, Ralf Peters explains that all areas of the business need to undergo fundamental changes across operations. With more than 90% of emissions occurring in its supply chain, Coca-Cola European Partners places high importance on taking action with its suppliers. The company encourages its suppliers to sign up to the science-based targets initiative, switch to 100% renewable energy for operations related to products and services produced, and to share their supplier base carbon data with Coca-Cola European Partners moving forward. Ralf has seen an encouraging response so far, noting that one-third of the company’s suppliers have signed up to these three key tasks.

 

 “Ambassador Network”
Aurélia Tremblaye, SVP & Group CPO, Atos

Atos was one of the first organizations to partner with EcoVadis back in 2010. At that time, it was Atos’ goal to encourage its suppliers to take the first step in their sustainability journeys. Atos now works with more than 350 suppliers within the EcoVadis network and has achieved a Platinum rating. These milestones motivate Aurélia Tremblaye to support decarbonization at every level within her organization. This is why Aurélia created a procurement decarbonization ambassador network at Atos, consisting of people from her team and buyers located in different regions of the world. The network has been trained to become trusted advisors for stakeholders to ensure they are correctly adapting toward sustainable best practices across the value chain.

 

“Cooperation and Technology”
Ernesto Dominguez Porta, President, Toyota Material Handling Europe (TMHE)

Toyota Material Handling Europe has signed with the World Intellectual Property Organization (WIPO) agreeing to share technology with its suppliers to help them reduce their carbon footprints. In addition to aligning all TMHE subsidiaries to a sustainability performance standard, Ernesto Dominguez Porta says the company’s code of conduct encourages its suppliers to suggest ideas and innovative solutions to help reduce emissions across the value chain. They meet every year to discuss how to both reduce their collective carbon footprints as well as how to use technology for good. It is Toyota’s goal to be zero emissions and 100% clean energy by 2030. This is why the company is challenging its suppliers to be more sustainable, and thus to use less energy.

 

Many smaller and medium-sized companies are only at the beginning of their decarbonization journeys. We see tens of thousands of suppliers each year struggle to quantify their carbon footprints and properly report emissions to buyers and stakeholders. Yet we know that emissions produced within the value chain account for a substantial part of companies' overall total. That’s why for more than a year, our EcoVadis team has been building our new Carbon Action Module to help our customers step up their commitments and deliver on their reduction or net-zero targets.

To learn more about how organizations can work toward net-zero emissions, check out the Sustain 2021 Carbon session video.

 

About the Author

EcoVadis ‏‏‎

EcoVadis is the world’s most trusted provider of business sustainability ratings, intelligence and collaborative performance improvement tools for global supply chains. Backed by a powerful technology platform and a global team of domain experts, EcoVadis’ easy-to-use and actionable sustainability scorecards provide detailed insight into environmental, social and ethical risks across 200+ purchasing categories and 160+ countries.

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