Climate Contract Playbook Edition 3
61
[Maria’s scorecard] NEW
The Origin Story
Child’s name
Maria’s scorecard
Full name
Supply chain emissions scorecard
Practice Area / Sector
Commercial, Corporate, Investment, Public Procurement
90% of companies’ impacts on the environment come from supply-chains 29 ; and typically the carbon emissions from a company’s supply chain are between 65% and 95% of the total emissions triggered by whatever it is a company does 30 . Fewer than 20 percent of supply-chain managers say they have visibility into sustainability practices in the supply-chain (Scope 3 GHG emissions, as defined below) 31 . Executives tend to focus on plans for the next business cycle; long-term sustainability is often overlooked due to understandable pressure to focus on short-term profits 32 . A pro forma scorecard to be incorporated into commercial agreements as a schedule. This could be implemented within both public and private sector deal- making. This would allow supply-chain sustainability to be viewed through the lens of risk to business continuity and the case for a longer-term approach would be easier to make. There are three scopes by which a company’s GHG emission can be catalogued. Scope 1 is direct emissions from owned or controlled sources; Scope 2 is emissions from purchased energy; and Scope 3 is any remaining GHG emissions not covered by Scopes 1 or 2 in the value chain both upstream and downstream of a product’s lifecycle. While acknowledging reducing GHG emissions under Scopes 1 and 2 are vital to a company’s sustainability profile (the scorecard assists the contracting party in disclosing these), Scope 3 are particular important for meaningful reduction of GHG emissions across many sectors 33 . Approximately 40% of global GHG emissions fall under the remit of Scope 3 as they are purchased and sold products and services. However, Scope 3 is often neglected by companies aiming to tackle climate change for a variety of reasons but principally because it is hardest to measure.
Issue
Solution
Context
Scope 3 emissions are particularly significant (on average) in a wide array of industries including automotive, logistics, and consumer packaged goods.
29 https://youmatter.world/en/sustainability-supply-chain-27935/ 30 https://perspectives.eiu.com/sites/default/files/llamasoft_report_-_report_digital_2_2_0.pdf 31 Blume Global 32 https://www.huffpost.com/entry/what-is-the-purpose-of-bu_b_7100126; https://www.ellenmacarthurfoundation.org/assets/downloads/publications/ Ellen-MacArthur-Foundation-Towards-the-Circular-Economy-vol.1.pdf 33 https://www.cdp.net/en/articles/media/supply-chains-hold-the-key-to-one-gigaton-of-emissions-savings-finds-new-report
Made with FlippingBook - professional solution for displaying marketing and sales documents online