Climate Contract Playbook Edition 3
33
[Zoë and Bea’s clause]
The Origin Story
Child’s name
Zoë and Bea’s clause
Full name
Green Supplier Agreement Terms
Practice Area / Sector
Commercial
Some supply agreements can lock a business or organisation into ‘brown contracts’ and don’t encourage sharing of climate-related information and accountability for emissions reductions across value chains.
Issue
A green procurement checklist and clause to make a standard supplier agreement focus on emissions across a value chain.
Solution
Many companies such as Microsoft are pledging to be Carbon Negative by 2030 11 . In order to achieve this, they will have to work across their value and supply chains to align them with this target.
Context
The clause should encourage existing suppliers to “up their climate change game” and thus accelerate a greater number of businesses in their transition to net zero.
Impact
1. Inhouse legal counsel 2. Directors (Board level) 3. Shareholders (engagement) 4. Law firms 5. Industry bodies 6. Regulators (industry specific)
Stakeholders
Further definitions could be inserted if the relevant business is using Science Based Targets to measure its emission reductions.
Application
This envisages use in a customer generated supplier terms using a green procurement process.
Notes for users
11 https://blogs.microsoft.com/blog/2020/01/16/microsoft-will-be-carbon-negative-by-2030/
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