Big businesses are increasingly recognizing the importance of addressing their carbon emissions, particularly within their supply chains, which often constitute over 70% of their total greenhouse gas emissions. Known as Scope 3 emissions, this area poses a unique challenge for companies as they strive to meet sustainability goals.
Historically, measuring and managing Scope 3 emissions has proven difficult due to complex data issues and the limited control companies exert over their supply chains. Many businesses found themselves hesitant to commit to net-zero targets without clear strategies in place to tackle these emissions.
Recently, the Science Based Targets initiative (SBTi) has proposed a shift in perspective on how to approach these emissions. Instead of focusing solely on aggregate Scope 3 emissions, SBTi suggests integrating new metrics that evaluate a company’s procurement practices and revenue streams in relation to global climate goals. This approach aims to transform Scope 3 emissions into a mechanism that aligns corporate practices with sustainability objectives.
For instance, companies could measure how much of their operational spending is directed toward suppliers achieving emissions performance aligned with net-zero targets. This not only promotes collaboration with suppliers to reduce their emissions but also helps companies communicate their climate performance effectively.
Experts, such as Holger Hoffmann-Riem from Go for Impact, emphasize that the key challenge lies not just in reducing emissions but ensuring that suppliers rapidly diminish their own. New metrics that capture this nuance, like requiring automotive manufacturers to sell a certain percentage of electric vehicles, could replace the traditional reliance on broad carbon metrics, paving the way for more actionable insights.
In summary, as businesses navigate the complexities of emissions management, approaching Scope 3 with innovative metrics may foster a more transparent, effective path toward corporate decarbonization, ultimately supporting global climate initiatives.
