How Major Companies Can Help Their Suppliers Decarbonize
In some assessments, the boldest way for companies to address climate change is to look beyond their operations and cut emissions across their value chain. That means eliminating emissions from their suppliers as well as how their customers use their products.
There’s just one big problem: companies don’t control the operations of their suppliers. And suppliers—often smaller companies—have fewer reasons to act. To get over the gap, some of the world’s biggest companies are taking matters into their own hands, providing their smaller suppliers with the tools and resources to decarbonize. As governments start requiring companies to tackle their value chain emissions—known in technical lingo as scope 3 emissions—more companies will have to take on this challenge. For those who aren’t engaged already, it's worth paying attention to the programs paving the way.
In July, Amazon launched a program dubbed “Sustainability Exchange” to provide suppliers with the resources to measure and cut their emissions. In September, a group of major automakers including Ford Motor Company and General Motors announced a partnership with the consulting arm of utility giant Edison International aimed at helping suppliers adopt renewable energy. And, since 2021, Walmart has partnered with HSBC to offer suppliers favorable financing terms to pay for decarbonization initiatives.
