Lessons learned from the Carbon Disclosure Project

A recent press release from supply chain execution software vendor
RedPrairie
Corporation was a welcome tip off to the publication of a
supply chain report from the Carbon Disclosure Project (CDP), a
London-based organization that works with industry to more
effectively track carbon emissions. First of all, it’s nice to see
a leading vendor such as RedPraire sponsor this important effort,
and provide a link to
the survey findings.

The report is a good read for anyone concerned about emissions and
greenhouse gas (GHG) tracking in their supply base, because it
provides insight from progressive enterprises such as IBM, Kellogg,
and Proctor & Gamble on carbon accounting collaboration with
suppliers. The report details the results of questionnaires sent
out to suppliers nominated by 34 CDP member companies. The
questionnaire covered carbon risks and opportunities, emissions
reporting, reduction targets and plans, governance, supplier
engagement, and product lifecycles.

There is a wealth of insights to be gained from looking at the
report, but for brevity’s sake, I’ll mention just a couple. For
one, even among suppliers of progressive companies involved in the
CDP, the response rate was not high. There were 2,318 invited
suppliers, but across all industries, the response rate was just 27
percent. On emissions reporting questions, only 30 percent of
respondents provided data on Scope 1 emissions (i.e., direct
emissions for facilities they control), while just 24 percent
provided data on Scope 3 emissions (indirect emissions such as
transport of raw materials). As the report concedes, this type of
carbon accounting across supply chains is just in its early
stages.

I know that talk of “Scope 1″ versus “Scope 3″ emissions sounds
pretty wonkish. That’s because the terms are specious, and it’s
confusing that they are multiple groups involved. Next week, I hope
to present some insights from experts to simplify some of these
terms and carbon accounting efforts. Today, I simply wanted to
point out the  CDP supply chain report. I don’t know about
you, but if I were a supplier to a big company like P&G, I’d
want to be among the modest percentage of suppliers able to respond
to an environmental questionnaire, and even better, be among those
able to provide them with emissions data.