Global suppliers achieve significant emissions reduction

More good news showing progress on climate change as suppliers around the world are cutting their carbon emissions significantly.

To a new report by the Carbon Disclosure Project (CDP), The Carbon Trust and BSR, the suppliers of 89 large multinationals have cut their emissions by 434 million tonnes of carbon dioxide last year alone. This is more than the annual emissions of my home country, France. The savings from these emissions reductions activities reported by companies disclosing this year are valued to $12.4 billion (almost doubling over the previous year) !


Room for improvement

The 89 companies mentioned above include heavyweights such as BMW, Johnson & Johnson, Microsoft, and Walmart. Their combined purchasing power is a massive $2.7 trillion annually. These companies have over 4,300 suppliers.

Now while these numbers seem huge, there is still large room for improvement as only 22% of responding companies are engaging with their own suppliers on carbon emissions and just 16% of companies are engaging on water use.


Opportunities abound

Now imagine if all 89 worked on energy and water consumption reduction. We would have even larger carbon emissions reductions. Imagine if more larger companies worked joined the CDP and worked on such issues. Additionally, to CDP press release :

59% of suppliers reported an increase in emissions or were unable to respond to their customer’s request this year. This represents a significant opportunity for buyers higher up the value chain to engage on capacity building, training, resources, and increase the cost savings.

Nowadays many multinational companies have their own objectives for cutting their energy consumption and greenhouse gases emissions. This is not done for any other reason that saving energy and going renewable are just cost effective measures that improve their bottom lines.

While this is great news, more companies every year need to work with their own suppliers to help them cut their own emissions for the same reasons.

Cleantechnica ends its article on that matter with a great quote that I need to share with you all:

“Supply chain is the next frontier in sustainability,” added Tom Delay, Chief Executive, Carbon Trust.

“Managing the environmental impact of your own operations is expected behaviour. 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.

Large public and private sector organizations can deliver change at the scale and speed required to address the challenges of climate change and resource scarcity. We hope that our insight and the examples from the leaders engaged with CDP help to accelerate the shift to a more sustainable, low carbon economy.”


Professionals need to step up

Having had an Operations and Supply Chain Management class during the course of my MBA at Presidio Graduate School, I could not agree more. A lot can be done to help companies – and their suppliers around the world – to cut costs.

This is yet another potential way for management and sustainability professionals around the world to help mitigate climate change.

Image credits: Frans Berkelaar, Flickr. 

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