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.
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:
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.
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:
Once your internal systems are in place, it’s time to bring suppliers into the process. The GHG Protocol outlines the following best practices:
Beyond GHG Protocol guidance, here are more strategies to support your Scope 3 journey:
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.