Why Enterprises Must Prioritize Supplier Support for Climate Disclosure
Enterprises cannot achieve net zero without acknowledging supplier emissions, but why is mobilizing suppliers so hard?
Corporate sustainability has emerged as a critical factor driving long-term success and resilience for enterprises across industries. Many companies have achieved significant milestones in reducing their direct (Scope 1) and indirect emissions (Scope 2). Now companies are honing their focus towards Scope 3 emissions – those generated throughout the entire value chain, including both upstream and downstream activities. Supplier emissions can constitute up to 75% of an enterprises' carbon footprint, as a result, supplier inclusion is a pivotal strategy for sustainability integration.
Why Should Enterprises Prioritize Supplier Sustainability Programs?
First and foremost, supply chain vendors play a key role in the environmental footprint of an enterprise, often accounting for the majority of their Scope 3 emissions. By working closely with suppliers to improve sustainability practices throughout the value chain, enterprises can achieve substantial reductions in greenhouse gas emissions, enhance environmental performance, and mitigate climate risks.
To be successful, many enterprises are providing educational resources and opportunities to reach out for assistance to better equip suppliers to handle enterprise climate disclosure requests.
In 2022, RyeStrategy partnered with Salesforce on a first-of-its-kind accelerator aimed at educating small and diverse suppliers and guiding them through a GHG inventory for their company. Louisa McGuirk, Senior Manager of Sustainable Procurement at Salesforce stated, “As Salesforce strives to accelerate global progress to net zero, our goal is to bring our suppliers along on that journey. We want to be sure we’re doing so in an inclusive way that supports small and diverse businesses in meeting our ambitious expectations.”
For many enterprises, simply asking their suppliers to take climate action isn’t enough and often falls flat with low participation rates. Louisa went on to describe the reason behind the accelerator program, “Our Sustainability Accelerator is one step toward aligning our equality and sustainability values with an inclusive approach to supply chain decarbonization that works at scale to advance SMEs on this journey.” Setting a foundation for sustainability success amongst suppliers will naturally make the climate data collecting process smoother and more efficient in the future.
Prioritizing supplier sustainability aligns with broader corporate responsibility goals and enhances brand reputation, creating trust among consumers and investors. Enterprises can drive innovation, improve operational efficiency, and create long-term value by becoming involved in their supplier’s decarbonization journeys. Ultimately, prioritizing supplier sustainability is not only ethically responsible but also strategically advantageous, positioning enterprises as leaders in sustainability.
The Importance of Supplier Inclusion
Among Scope 3 emissions, those originating from the supply chain often represent a substantial proportion for many enterprises. Therefore, engaging and collaborating with suppliers is essential for effectively reducing an enterprise's carbon footprint. Here's why supplier inclusion matters for climate disclosure:
Leading by example: Working closely with suppliers enables enterprises to gain insight into the environmental impact of their supply chain activities. Offering resources, workshops, and connecting suppliers with a firm that specializes in carbon accounting can help increase the likelihood of success.
Comprehensive reports: Enterprises can access the necessary information to provide stakeholders with a complete picture of their environmental footprint. This transparency not only enhances credibility but also demonstrates a commitment to accountability and integrity in sustainability reporting. Additionally, involving suppliers in climate disclosure requests fosters a shared responsibility, leading to more effective and impactful sustainability initiatives across the entire supply chain.
Risk Management: Suppliers face many of the same environmental risks as their customers, including resource scarcity, regulatory compliance, and reputational damage. Supporting suppliers in improving their sustainability practices not only reduces overall emissions but also strengthens the resilience of the entire value chain by reducing risks.
Building a Supply Chain Decarbonization Program that Works
Understanding the need for supplier inclusion for a corporation's overall sustainability success will accelerate progress. It is crucial for businesses to measure, and reduce, Scope 3 emissions along their value chain to achieve net zero and carbon reduction targets. This requires collaborative action and executive support in order to successfully accomplish goals and bring value to stakeholders.
RyeStrategy partners with enterprise sustainability and sustainable procurement stakeholders to design supply chain decarbonization programs that deliver supplier engagement results and accelerate net zero progress. With years of hands-on experience providing carbon management services to small and medium sized suppliers to Microsoft, Walmart, Target, Atlassian, and many more, RyeStrategy is uniquely qualified to architect comprehensive, results-driven supplier engagement programs that are a win for our enterprise clients, and a win for their suppliers.
Schedule a call to speak with a sustainability manager about RyeStrategy’s Supply Chain Decarbonization membership. The membership is affordable, scaleable, and delivers high value sustainability support to your suppliers who need it most. Whether your organization is many years into Scope 3 reduction action or hasn’t started yet, RyeStrategy can help you reach your near and long term emissions reduction targets.
Reduce Scope 3 emissions with our affordable supply chain decarbonization solutions.
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Read more about supplier emissions in our blogs below:
About RyeStrategy
Based in Seattle, RyeStrategy is a CDP-accredited, mission-oriented company specialized in carbon accounting, mitigation coaching, and climate disclosure solutions for organizations at any point in their sustainability journey. Learn how RyeStrategy helped Salesforce, Ideascale, and Wazoku achieve their sustainability goals.
From exhaustive carbon footprinting and mitigation coaching, to setting science-based targets and reporting climate data to CDP, SBTi or custom reporting platforms, RyeStrategy acts as a hands-on extension of the team, custom-tailoring services to fulfill climate disclosure requirements easily and accurately.
Meet with a sustainability specialist to learn more about RyeStrategy solutions.
