For most large global companies, carbon tracking and management has become standard practice. Organizations that started working to reduce their greenhouse gas (GHG) emissions several years ago are reaping the benefits of efficiency improvements and energy management programs in the form of emissions reductions and cost savings. And now these companies are starting to look down their supply chains for ways to squeeze even more carbon out of their overall footprint.
The Carbon Disclosure Project (CDP), which has been collecting GHG emissions data from companies for nearly a decade, recently released a report which revealed that there is a gap that exists between the carbon reduction performance of companies and that of their suppliers. The study, conducted in partnership with Accenture, was conducted with 50 CDP member organizations including L’Oréal, Philips and Walmart, and more than 1,800 of their suppliers. It found that while 43 percent of companies surveyed have achieved year-over-year reductions in their carbon emissions, only 28 percent of their suppliers have done so.
This gap exists despite the fact that emissions reductions have produced monetary savings for 39 percent of these companies and 34.5 percent have also benefitted financially from their suppliers' carbon reduction efforts. These findings indicate that there is clear opportunity for companies to realize additional carbon and financial savings by reducing their Scope 3 emissions - those that result from within the supply chain rather than from a company's direct operations.
Companies are waking up to this reality and are starting to encourage their suppliers to take appropriate action. According to Frances Way, program director for CDP, "Companies are evolving the way they operate to better capitalize on the opportunities presented by carbon efficient supply chains." Evidence of this can be seen in the shift in supply chain policies that's happening within the companies surveyed:
Kara is a corporate social responsibility professional and marketing consultant with expertise in consumer research and environmental science. Currently, Kara is working as a Graduate Associate on the <a href="http://corporate.disney.go.com/citizenship2010/">Corporate Citizenship</a> team at the Walt Disney Company. She is also a founding partner of <a href=http://besui.com/">BeSui Consulting</a>, a boutique marketing consulting firm specializing in consumer insights and marketing communications.
Kara graduated from Rutgers University with a B.S. in <a href="http://admissions.rutgers.edu/Academics/AcademicContent.aspx?CAMPUS=New… Policy, Institutions and Behaviors</a>. She is currently pursuing her M.B.A. in Sustainable Management from <a href'"http://www.presidioedu.org/">Presidio Graduate School</a> where she is exploring the impact investing space and working to identify new ways to increase access to capital for start-ups and social ventures. Follow her on Twitter <a href="http://twitter.com/karameredith">@karameredith</a>.