Verification of supply chain sustainability depends on companies having ready access to carbon emissions numbers at every stage of product development. But what if some suppliers are unable or unwilling to provide that critical data?
The need becomes even more pressing as regulators mandate the reporting of Scope 3 emissions — those generated by supply chain partners over which a manufacturer, retailer, brand or distributor has no direct control. But that’s also the most difficult information to obtain.
The stakes are especially high when it comes to measuring the impact of food supply chains, which contribute about one-quarter of global emissions overall. “Suppliers are not as responsive to brands as they need to be in order to get that accurate data,” says Cate Battey, director of growth and innovation with HowGood, a food sustainability database of more than 90,000 emission points around the world.
The reasons are many. Battey says suppliers may be at varying stages of maturity in their ability to collect and dispense sustainability data. They might lack the time and resources to address questions from brands and retailers. Or they might have concerns around data privacy and security.
The challenge is very much one of education, enlightenment and collaboration, Battey says. “It’s about finding how to engage suppliers in ways that are going to empower them.”
Suppliers might also become frustrated over the differing demands for data by their many downstream buyers. HowGood’s supplier connection platform addresses that problem by simplifying and standardizing the type of product-level data that’s required.
HowGood conforms to technical specifications laid out by the Partnership for Carbon Transparency (PACT), provider of a streamlined methodology for calculating and exchanging carbon-footprint data. It’s an initiative of the World Business Council for Sustainable Development, a co-convenor of the Greenhouse Gas Protocol, which defined the three emission “scopes” that need to be measured and reported to the European Union and other global regulators.
HowGood also recently announced a strategic partnership with Green Project Technologies, provider of a carbon-management platform to identify carbon footprints specific to each supplier across a food supply chain. Green Project extends the measurement effort to include packaging, logistics and other relevant operations.
Obtaining emissions data becomes increasingly difficult as companies move up the tiers of sub-suppliers. But they’re not always the knottiest problem. Battey says HowGood encourages customers to start with the highest-impact supplier, whether that’s at Tier 1 or well beyond.
Often, though, it’s the very beginning of the food supply chain where data access becomes difficult. HowGood’s platform includes tools aimed at including on-farm inputs in submissions. The vendor also partners with the Cool Farm Alliance to equip farmers and other entities in the food supply chain with metrics for communicating about sustainability and charting progress toward carbon-reduction targets.
Defining what constitutes “sustainable” isn’t necessarily a snap. For new customers, HowGood establishes a baseline for measuring and inputting data. Its methodology aligns with the Greenhouse Gas Protocol and ISO 14067 reporting requirement. The process helps to identify “hotspots” within food supply chains, while promoting sustainable practices such as regenerative agriculture, no-till farming and carbon sequestration.
All of this goes a long way toward satisfying regulators, but a key question remains: Do consumers care? Battey believes they do. Regulations aside, sustainability is becoming an increasingly important factor in brand reputation, and profit-minded supply chains are highly motivated to comply.
“We’re seeing more and more interest in including emissions results in the consideration of working with a brand or retailer,” she says. “The [food] industry is moving toward including supplier performance as a prerequisite for relationships.”
In distributed, highly complex supply chains, it all starts with getting the right information. “You cannot execute on carbon-reduction initiatives without accurate data,” Battey says.