CDP survey of over 11,000 companies found just 38% engaging with suppliers on climate change issues
A new report from non-profit global disclosure company CDP has revealed only a small group of businesses are truly making meaningful environmental action. In order to avert the irreversible and undeniable risk of climate crisis, here we explore some of the key report findings and explain how mapping, remote auditing, standardised ESG assessments and KPI technology can help businesses to engage the chain.
Key CDP global supply chain report findings
- Just 38% businesses engaging with suppliers on climate change
- More than half (56%) said suppliers had no climate targets in 2021
- 71% of companies reported scope 1 and 2 emissions in 2021
- But only 20% are reporting on scope 3 (or supply chain emissions)
- Just 47% working beyond tier 1 to mitigate deforestation risk
Engaging with suppliers to address climate change
The impact of climate change is far reaching and immediate action is required to protect the planet for centuries to come. Businesses play a huge part in driving positive change through compliance with changing regulations and best practice sharing, whilst holding the power to influence consumer and supplier behaviour for the better.
But with so many pressures coming from all angles, it can be challenging for brands to truly collaborate with all actors in the value chain. And sadly, the CDP report echoes this with just 38% businesses found to be engaging with suppliers on climate change.
With more than half (56%) stating suppliers had not set climate targets, organisations higher up the chain are well positioned to guide suppliers in the right direction by sharing achievements and key lessons learnt. To do this, supply chain transparency is crucial.
Introducing a supply chain visualisation solution enables businesses to map all tiers of the supply chain, providing a central secure platform to engage and educate suppliers on pressing environmental and ethical matters, relevant to your brand.
From creating bespoke remote audits to understand risk, benchmarking ESG impact using a standardised assessment, or monitoring supplier performance against defined key performance indicators, your company can utilise actionable insight to guide environmental improvement discussions with organisations throughout supply chains.
Capturing and reporting supply chain emission data
Although 71% of companies included in the CDP survey are now reporting operational emissions, only 20% are disclosing emissions generated by the supply chain.
Measuring supply chain emissions is understandably difficult, especially when many businesses lack visibility beyond tier 1, but with scope 3 emissions over 11 times higher than scope one and two combined on average, businesses wanting to truly reduce impact must rise to the challenge.
Leveraging digital tools for data collection including assessments and KPIs via the Authenticate platform, your business can track supply chain emission data at specified intervals to assist with disclosure or regulation deadlines, and interrogate interactive dashboards to monitor progress over time.
Visualising and mitigating supply chain deforestation risk
Not all environmental risks are as relevant to every business, but deforestation matters have rightly received plenty of attention in recent years, from the recent FACT Roadmap for Action to the Leaders’ Declaration on Forests and Land Use, signed at COP26.
Nevertheless, just 47% of downstream companies, such as traders, manufacturers and retailers have been found to be working beyond tier 1 suppliers, in order to mitigate deforestation risks according to the CDP report.
If mitigating deforestation risk is a priority for your business, Authenticate’s range of supply chain transparency tools can assist by:
- Collating high-risk commodity products in a custom catalogue structure
- Mapping supply chains to identify deforestation risk and prioritise by region or product
- Sending and collating tailored remote audit results to assess and benchmark supplier risk
- Tracking certification status against globally recognised schemes including RTRS
- Report on and share progress against deforestation goals via digital dashboards
Read more about how our technology can help businesses root out supply chain deforestation.
Want to start collaborating with direct and indirect suppliers using Authenticate to drive progress against environmental goals? Get in touch with the team to request a demo.