The science is clear: to limit global warming to 1.5°C and avoid the worst effects of climate change – from extreme weather events to biodiversity loss and economic instability – global emissions must be cut by 45% by 2030. And businesses have a crucial role in helping humanity achieve this goal.
While many organisations are now tracking and reducing their Scope 1 (direct) and Scope 2 (indirect from energy use) emissions, Scope 3 presents a different challenge. It demands collaboration, communication, and long-term strategy across the entire value chain.
Despite its complexity, Scope 3 holds the greatest potential for impact. It typically accounts for more than 90% of a company’s total carbon footprint. In fact, upstream Scope 3 emissions alone – those from suppliers and purchased goods/services – are, on average, 11 times higher than operational emissions. With that scale of influence, and with climate targets becoming increasingly stringent, it’s essential to go beyond emissions directly under your control and take a more holistic approach to greenhouse gas (GHG) reduction. Not just for your business, but for the planet.
But unlike Scope 1 and 2, Scope 3 emissions come from sources you don’t own or directly control, such as purchased goods and services, transportation, product use, and end-of-life disposal. This makes engagement across your value chain critical, particularly with suppliers, who often hold the key data needed for effective reporting and emissions reduction.
But for many companies, supplier engagement is new territory. Many industries still struggle with emissions transparency, and while best practices and legislation are evolving, too few businesses have taken the steps required to drive real change. The expectation, however, is clear: according to the Science-Based Targets initiative (SBTi), companies must set Scope 3 targets that cover at least 67% of their Scope 3 emissions to align with climate science.
This article breaks down the GHG Protocol’s Supplier Engagement Guidance and offers practical tips to help your business get started.
A Quick Overview: Scope 3 and the GHG Protocol
Environmental action requires international coordination, not just sector- or country-specific efforts. The Greenhouse Gas (GHG) Protocol is the most widely used global standard for measuring and managing GHG emissions. It underpins nearly all major reporting frameworks, including the SBTi, CDP, and various national regulations.
Within the GHG Protocol is the Corporate Value Chain (Scope 3) Standard, which provides a globally recognised framework for assessing a company’s full emissions footprint. Recognising the complexity of Scope 3, the GHG Protocol breaks it into 15 distinct categories across upstream and downstream activities, such as:
- Upstream: Purchased goods and services, capital goods, fuel and energy-related activities, waste, employee commuting, etc.
- Downstream: Use of sold products, end-of-life treatment, downstream transport, and investments.
The first step to managing Scope 3 is to map your value chain and identify which activities fall under each category, and where the greatest impacts lie. From there, supplier engagement becomes critical.
Internal Preparation: 4 Key Steps Before Engaging Suppliers
Collecting Scope 3 data can be daunting – especially if supplier relationships or data systems aren’t yet aligned. The GHG Protocol recommends laying a strong internal foundation before involving suppliers. This not only streamlines collaboration but signals your commitment to the process. Here are four essential internal steps:
- Identify Internal Owners
Pinpoint the departments responsible for collecting and managing environmental data. Align with existing ESG or CSR initiatives where possible. Procurement teams often play a central role, and appointing a senior champion within procurement can accelerate progress. - Select Key Suppliers
Most companies only have visibility into Tier 1 suppliers. Start by identifying those responsible for the highest-emission goods or services. If emissions data is unavailable, prioritise based on total spend. A good benchmark: focus on the top 80% of suppliers by emissions or spend. Gather contact details, supplier type, spend figures, and commodity information. - Engage the Procurement Team
Ensure procurement staff understand the programme’s importance and are equipped to explain it to suppliers. Their role in supplier communication, relationship management, and data follow-up is critical. - Develop a System for Managing Supplier Data
Whether it’s an internal spreadsheet, online tool, or third-party GHG software, choose a system that balances ease of use, data analysis, and accessibility across teams. Prioritise efficiency, data assurance, and integration with other reporting functions.
External Engagement: Best Practices for Working with Suppliers
Once your internal systems are in place, it’s time to bring suppliers into the process. The GHG Protocol outlines the following best practices:
- Announce the Programme
Send a formal letter explaining the initiative, why it matters, how data will be used, and what support is available. Emphasise confidentiality and request a contact responsible for emissions data. - Provide Training or Information Sessions
Offer webinars or training to help suppliers understand the survey process and how to complete it. Suppliers will vary in their GHG knowledge and some may need extra support where needed. - Check In Regularly
Follow up with suppliers throughout the process to address issues, encourage completion, and build stronger collaboration. - Plan for Non-Responses
Set clear expectations around participation, including potential consequences or follow-up steps for those who don’t engage. - Assess and Review Data
Check the data received, resolve questions, and thank suppliers for their input. This also helps reinforce the importance of the programme and sets the tone for ongoing collaboration.
Additional Tips for Scope 3 Success
Beyond GHG Protocol guidance, here are more strategies to support your Scope 3 journey:
- Secure Leadership Buy-In
Senior-level support helps align decarbonisation with wider business goals and unlock resources for cross-functional collaboration. - Map Your Full Value Chain
Review each of the 15 Scope 3 categories in the GHG Protocol to understand where your emissions sit, both upstream and downstream. - Commit to Continuous Improvement
As your inventory matures, aim to improve data quality and completeness year on year. Better data enables better decisions and more robust reduction tracking. - Use SBTi and Lifecycle Reporting
Align your efforts with Science-Based Targets and incorporate full lifecycle assessment to ensure your Scope 3 strategy is credible and future-proof.
Supplier Collaboration Is the Missing Piece
The path to net zero doesn’t end at your company’s door. It extends across the entire value chain, and suppliers are a key part of the journey. While engaging them can be challenging, doing so effectively is one of the most powerful ways to reduce emissions at scale. With the right internal preparation, supplier engagement strategy, and continuous improvement, companies can unlock meaningful progress on Scope 3 reduction journey.
