Is your business embracing the supply chain opportunity?

CDP’s recent Global Supply Chain Report 2018 shows that more global companies are widening their sustainability focus to include the emissions from their supply chains. Michael Watts, Strategic Sales Manager, explains why businesses should embrace this opportunity to amplify their impact.

Many corporates have taken great strides with their sustainability ambitions over the past few years, particularly when it comes to reducing carbon emissions from their operations.

Renewable energy has been a huge driver of these reductions. It has been exciting to see the huge growth of the RE100 initiative last year, and they have just announced their 125th member company so the momentum seems to be continuing.

Shifting the focus to supply chains

Now that these leaders have achieved reductions in their own emissions, their focus is now turning to their supply chains and scope 3 emissions.

It’s an area that must be addressed - according to CDP’s Global Supply Chain Report 2018, emissions located in the supply chain are on average four times as high as those arising from direct operations.

In their report, CDP highlights 58 companies that are leading the way including Apple, Bank of America, Nestlé and BT Group. These leaders and the other 4,800 businesses that participated in the CDP disclosure, collectively saved 551 million metric tonnes of carbon dioxide in 2017 through their reduction activities - more than Brazil’s total emissions in 2016.

This progress is very positive but much more still needs to be done if we are to achieve the 1.5°C ambition agreed in Paris and prevent the worst effects of climate change.

At the launch event for the CDP report, the UN's climate change chief Christiana Figueres spoke about “unlocking the exponential power” of the supply chain. She issued a fantastic challenge to the 100 supply chain program members – to call three of their key suppliers and ask them to commit to setting a science-based target before the Global Climate Action summit in September 2018.

It sounds simple and it is – that’s why it’s so powerful. Supply chains can be huge and complex but focusing on just three suppliers is achievable for most companies.

Making science-based targets more mainstream and encouraging businesses at all levels of the supply chain to be accountable for their emissions is crucial, and large companies should be using their purchasing power to drive this.

Our renewable energy challenge

We published a report last year calling on corporates to do more to engage their supply chains on renewable energy and it’s great to see this theme gaining more traction.

Taking inspiration from CDP and Christiana Figueres, we think companies should also ask their top suppliers whether they are procuring renewable electricity. It’s the easiest way for them to reduce their emissions, and therefore your scope 3 footprint, and is easy to do in many countries – particularly the UK.

There is a strong hypothesis that simply asking whether a business uses renewable electricity will drive adoption. Just picture the emissions reductions when we move from hundreds of companies to thousands of companies buying and reporting renewable electricity!

Our independently certified renewable electricity products are designed to simplify carbon reporting, so would make it easy for even small suppliers to do their bit and give you complete transparency and confidence in your scope 3 emissions from purchased electricity.

We are ready to support companies with supplier engagement on renewables so please get in touch if you think we can help you.

> Download our Renewable energy in the supply chain report

> Download our Guide to purchasing and reporting renewable electricity

About the author

Michael joined SmartestEnergy in 2017 and is a key member of the I&C Supply team. He is primarily responsible for identifying and developing strategic sales opportunities and promoting SmartestEnergy’s products to I&C users. Before joining SmartestEnergy Michael held a similar role with ENGIE Energy Solutions. His career in the industry has also included positions with Haven Power, Shell Gas Direct and Gaz de France. Michael has an MA Business Economics from Wilfrid Laurier University, Toronto and a BA Economics from the University of Essex.

> Connect with Mike on LinkedIn