For most procurement organizations, carbon management — and greenhouse gases (GHG) more broadly — is a hot topic (no pun intended). There are multiple challenges to tackle, many of which apply to other ESG areas. Even though carbon management is one of the more advanced ESG categories, many organizations lack a structured framework, a methodology and a standard framework. This means a massive effort is needed to assess Scope 3 emissions, i.e., the carbon footprint inherited from all indirect emissions of a company’s value chain.
As an increasing number of companies communicate their CO2 reduction targets as a response to the demands of regulations, customers and investors — and because it is simply the right and urgent thing to do — procurement teams are being tasked with understanding and reducing upstream Scope 3 emissions. For most industrial companies, upstream Scope 3 represents the majority of emissions, as illustrated by a McKinsey report stating that “typical consumer company’s supply chain creates far greater social and environmental costs than its own operations, accounting for more than 80% of greenhouse-gas emissions and more than 90% of the impact on air, land, water, biodiversity and geological resources.”
These challenges have prompted Spend Matters to launch a carbon management category for TechMatch. In this first article, we examine the broad questions of carbon management and supply a high-level examination of the initial participants of the new module.