HP, Philips help supply chains scrub 434 million tons of CO2
Big corporate buyers are driving a sea change in climate action throughout the world's industrial supply chain, according to a new report released by the Carbon Disclosure Project (CDP).
Last year suppliers worldwide cut emissions by 434 million tons of carbon dioxide, more than France's total emissions in 2014. The move delivered associated cost savings of $12.4 billion, more than double the figure achieved in 2015.
According to CDP, the shift was prompted by many of the world's leading corporates stepping up their commitments to tackle indirect emissions following the Paris Agreement in 2015, which requires global emissions to hit net zero before the end of the century.
As pressure mounts and the impacts of climate change intensify, suppliers are increasingly recognizing the need for climate action: of the 4,366 supplier companies that responded to the CDP's request for information, 75 percent said their business faces significant climate risks and 68 percent said they recognize the positive opportunities emerging from climate action.
Yet despite the growing enthusiasm for action, there still not enough is being done to curb supply chain emissions, according to CDP.
The report, written in partnership with BSR and the Carbon Trust, found that although emissions savings jumped substantially compared to last year, less than half of suppliers have set carbon targets or tracked cost savings from emission reduction activities.
"Supply chain is the next frontier in sustainability," Tom Delay, chief executive of the Carbon Trust, said in a statement. "Managing the environmental impact of your own operations is expected behavior. But the greatest opportunities for reductions are typically outside of direct operational control, in the supply chain. While some are showing what can be done today, the majority do not yet have a clear understanding of how to measure their impact or find the value in working with suppliers."
The report also named 29 companies with a seat on CDP's first supplier engagement leader board. Selected from 3,300 companies, the firms — which include Hewlett-Packard and Philips — were chosen for their commitment to driving down emissions throughout their supply chains.
"We congratulate the 29 leading companies that are using their buying clout to drive change across their supply chains," Dexter Galvin, head of supply chain at CDP, said in a statement. "Companies have a critical role to play in delivering on the Paris Agreement, and as well as setting their own house in order, it is essential they turn their attention to the risks and opportunities outsourced to their supply chain.
"By harnessing their purchasing power, big buyers have the potential to deliver the large-scale, rapid change that is needed and lead the way towards our sustainable future."
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