Corporate Carbon Management

Decarbonization Avenue : Corporate Carbon Management


For many industries, a large part of CO2 emissions - as high as 80% - in fact take place in their supply chains, and not in their core manufacturing process. A large company may have thousands of suppliers, mostly small, in dozens of countries. Most of these suppliers are part of other supply chains, providing goods and services to other buyers.

Industrial activities cumulatively contribute to about 35% of the total CO2 emissions worldwide. Eight global supply chains account for more than 50% of annual greenhouse gas emissions. Only a small proportion of these emissions are produced during final manufacturing. Most are embedded in the supply chain—in base materials, agriculture, and the freight transport needed to move goods around the world.

For industries such as food and textiles, large portions of their value chain emissions are in the upstream segment (farming, for instance) and mid-stream segments (fabric production, for instance). Having a more comprehensive intelligence on the sources of their CO2 emissions can help companies to take appropriate action with all relevant industry stakeholders to bring down the emissions within stated targets. In addition, today’s market and regulatory environments require that companies are able to provide their internal and external stakeholders a more holistic picture of their business and product carbon footprint.

Achieving net zero for emissions in Scope 1 (direct emissions from business operations) and Scope 2 (emissions from energy purchased for operations) categories itself is a formidable technical and economic challenge for many companies, especially those in energy- and resource-intensive sectors, such as heavy industry. Tackling Scope 3 (emissions from their supply chain or downstream user segments) presents an additional layer of complexity, including opaque carbon-accounting and tracking practices. The need to work collaboratively with customers, supply networks, and industry groups, and the difficulty of keeping stakeholders engaged in a complex, multiyear change effort pose significant challenges.

Of the 239 companies that signed up to the Science Based Targets Initiative in 2020, for example, about 95% included commitments to reductions in emissions at customers and suppliers - scope 3 emissions. That is a big commitment, and being able to meet it will require tremendous amounts of intelligence and initiatives.

These are possible only if corporates are able to implement systems and technologies that can capture disaggregated authentic data on carbon emissions from all points in the value chain, and are able to effectively analyse them to provide both intelligence and recommendations for action.

Industries impacted

  • Business support services
  • Internet & online solutions
  • Computers & software
  • Environmental services
  • Financial services
  • Marketing & communications

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Themes & Topics

  • Upstream

    • Agriculture

    • Mining

    • Oil & gas extraction

    • Petrochemical production

  • Midstream

    • Production

    • Logistics

  • Downstream

    • End users

    • Post life

  • Low carbon capacity development for employees and partners

  • Transparency

  • Reporting

    • Internal

    • External

  • Carbon footprint management through

    • Renewable energy

    • Energy efficiency

    • Energy storage

    • Waste management

    • Water efficiency

    • Low carbon mobility

    • Carbon capture & use

 

  • Frameworks & approaches

    • Science based targets

    • Internal carbon pricing

  • Collaboration between corporate and other external stakeholders

    • Suppliers

    • Customers

    • Logistics providers

    • Recycling stakeholders

    • Waste management companies

    • Universities & academia

    • R&D & innovation stakeholders

  • Policies

  • Use of IT & digital tools

  • Market opportunities

  • Financing

  • Online portals and platforms