How do you manage greenhouse gas risks in your supply chain?

2 Why is supply chain GHG accounting important?

Supply chain GHG accounting refers to the calculation and disclosure of the GHG emissions that occur upstream and downstream of your organization's operations. These include emissions from raw material extraction, transportation, processing, distribution, use, and disposal of your products or services. Supply chain GHG accounting is important because it can reveal significant sources of GHG emissions that are not under your direct control, but that may affect your reputation, competitiveness, and compliance. By accounting for your supply chain GHG emissions, you can identify opportunities to reduce them, engage with your suppliers and customers, and demonstrate your leadership and responsibility.

3 How do you measure your supply chain GHG emissions?

To measure your supply chain GHG emissions, you need to define the scope and boundary of your GHG inventory. According to the GHG Protocol, there are three scopes of GHG emissions: direct emissions from sources owned or controlled by your organization (Scope 1), indirect emissions from the generation of electricity, heat, or steam that your organization purchases and consumes (Scope 2), and all other indirect emissions that occur in your value chain (Scope 3). The latter is the most relevant for supply chain GHG accounting, as it covers a wide range of activities and sources that may have a significant impact on your GHG footprint. However, Scope 3 emissions are also the most challenging to measure, as they require data collection and estimation from multiple sources and assumptions. To simplify this process, you can use the GHG Protocol's Scope 3 Standard which provides a framework and guidance for calculating and reporting scope 3 emissions. This categorization can help you prioritize the most relevant and significant types of scope 3 emissions for your organization and focus on those.

5 What are the benefits of supply chain GHG management?

Supply chain GHG management can bring multiple benefits to your organization, such as reducing costs and risks, enhancing innovation and competitiveness, and contributing to sustainability and social responsibility. Reducing your supply chain GHG emissions can lower your energy and resource consumption, improve your operational efficiency, and avoid potential fines and penalties. It can also reduce your exposure to climate-related risks, such as physical impacts or reputational damage. Additionally, managing your supply chain GHG emissions can stimulate innovation and differentiation in your products or services, as well as increase market share and customer loyalty. Furthermore, it can demonstrate your commitment to the global climate goals and the sustainable development agenda, strengthening your corporate culture and values.