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Decarbonizing Supply Chains Would Be Game-Changer for Fighting Climate Change

The opportunity for impact is especially high for consumer-facing companies, whose supply chain emissions far outweigh their direct emissions from manufacturing.

On the heels of the World Economic Forum’s release of its annual Global Risks Report — of which the biggest long-term risk remains a failure to act on climate change — comes another report that shows how eliminating supply chain emissions would be a game changer in the global fight against climate change.

Net-Zero Challenge: The Supply Chain Opportunity, published this week by the World Economic Forum and Boston Consulting Group (BCG), analyzes the top eight global supply chains — which account for more than 50 percent of global greenhouse gas emissions — and finds that end-to-end decarbonization of these supply chains would add as little as 1-4 percent to end-consumer costs in the medium term. It also points to the global nature of many supply chains, enabling companies to support decarbonization across borders and in countries where governments do not yet prioritize climate action.

We’ve seen a growing wave of commitments to address the climate crisis across sectors; but, particularly, the private sector — with companies including Burberry, Google, Kering, Levi Strauss, Microsoft, Natura, PepsiCo, Procter & Gamble, Target, Unilever and Walmart, to name a few — launching bold climate action plans in the past two years, with all focusing much-needed attention on their Scope 3 emissions.

“We see the progression at CDP, says Dexter Galvin, Global Director Corporations and Supply Chains at CDP. “At the beginning, we mainly worked with sustainability functions. But over time, this increasingly shifted out to procurement teams as well — thinking about the full supply chain.”