Emissions reporting without emissions management is insufficient. To really move the needle on climate change, these companies must build on their success in reporting and take stronger action to generate better results. We have seen this pattern among the larger public corporations and expect the same trend to develop among suppliers.
Use more sophisticated tools to measure success Given the challenges in measuring and allocating gains between companies and their suppliers, companies will need to use better metrics and more sophisticated information management. Organizations such as CDP are now enabling better communication and providing a standardized platform for emissions-related information from suppliers. This not only reduces redundancy (multiple stakeholders requesting the same information) and provides improved risk management, but also paves the way toward strategic advantages and cost reduction. There is simply more to know about GHG emissions—and more to improve— with each passing year. Companies that do not upgrade their information management capability will be at a serious disadvantage.
A new era: supplier management in the low-carbon economy The opportunities for generating value from climate-change initiatives are already large and still growing, and the supply chain is a key area of growth. The most forward-thinking companies are taking specific actions today to produce real, measurable business value, in the form of increased revenue, lower costs, mitigated risk, and a host of intangibles. These actions will only become more valuable—and mandatory in some cases—as the risks and impacts of climate change grow and as sustainability becomes increasingly embedded into the core of the businesses and governments that are part of your supply chain.
This is an extremely dynamic field, and some climate-change initiatives may fall short of projections, while others will lead to unexpected victories. However there is already enough precedent— supported by the findings in this report—to understand what works best. More effective evaluation of suppliers, better collaboration, and stronger procurement functions can all lead to markedly improved carbon management along the supply chain. In short, waiting for the perfect solution is no longer an option. There is value on the table for companies that can craft the right climate-change initiatives. If you don’t, your competitors will.
13 The 613 companies who identified as Small to Medium-sized Enterprises (SMEs), were not asked this question, reducing the total to 1251 from 1864 responding companies.
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