Is Scope 3 Too Big To Swallow ?

Where is the "orchestration layer" to integrate the various standards, specialised platforms, tools and surveys for consumption and emissions data into one unified view of corporate impact ?

Companies that previously committed to carbon reduction targets are now failing to meet these commitments, including major corporations like Unilever, Procter & Gamble, Microsoft, Walmart, Diageo, Iberia, and easyJet. The Science Based Targets Initiative recently removed around 200 companies' net-zero or near-term targets from its dashboard. Despite these setbacks, some companies claim to remain committed to carbon reduction, with Unilever aiming for net zero by 2050 and others focusing on shorter-term goals for 2030, mainly addressing their direct emissions rather than the broader Scope 3 (supply chain / value chain) emissions.?

The challenge in meeting these targets is compounded by the long-term nature of the goals, technological uncertainties (e.g. the development of hydrogen-based fuels for airlines), and complexities in managing emissions throughout the supply chain. The SEC's decision to not require U.S. companies to report scope 3 emissions reflects these difficulties. Although setting ambitious climate goals is crucial for driving progress, the discrepancy between aspiration and practical achievement is becoming apparent, risking the credibility of companies that have been vocal about their environmental commitments.

It's a tough nut to crack. In order to be able to reduce emissions, we need to measure, but taking action really means we must emphatically prioritise reduction. Our skills and resources must be targeted at lowering emissions, so I'm extremely interested in how we can take the burden out of gathering data and obtaining adequately high-quality measurements, sufficiently useful to determine our reduction strategies. In considering how Earthchain delivers technology to lower these workloads, I keep returning to a handful of themes where I do think there are significant gains to be made, if supported by fair winds and following seas...

?? Increase Policy and Regulatory Support

Governments and international bodies should push harder for the disclosure and reduction of Scope 3 emissions through mandatory reporting requirements, and incentives for companies that achieve significant reductions in their supply chain emissions. While the SEC's requirements don't go far enough in my mind, other jurisdictions already have or are actively working towards including Scope 3. As an example, the UK Government recently conducted a consultation with stakeholders on extending the SECR reporting regime to include more Scope 3 data points, and I await the results with interest.

?? Support Better Supply Chain Engagement and Collaboration

Companies could work more closely with their suppliers and customers to share best practices, provide training & support around reporting requirements, and encourage or require adherence to certain environmental standards provided that the collaboration is made efficient. Suppliers face a barrage of well-meaning questionnaires and surveys from numerous customers, each having sufficient difference that the workload skyrockets. But SMEs who are in supply chains could be more proactive and recognise that good quality GHG disclosures can give them the edge in selection competitions and RFPs, and maintain a central repository of data to answer those surveys more effectively.

?? Develop More Automated Data Gathering and Analysis Tools

Enhancing the tools and methodologies for measuring emissions could help companies more efficiently track their emissions data. This requires an improvement in the efficacy of data gathering along the supply chain and the filtering of that data, to take the “donkey-work” out of obtaining and preparing the required information. It's unlikely that one tool or approach could ever cover the entirety of all supply chain emissions. But deploying the right specialised tools which leverage automation in data gathering and analysis would mean sustainability practitioners can focus most of their time (and budgets) on the interpretation of that data, concentrating on identifying and implementing reduction strategies over data gathering and analysis.

?? Leverage Standardised Solutions for Exchanging Data

Utilising transparent technology such as blockchain for authenticated disclosure of emissions data, or digital platforms that facilitate standardised secure sharing or "passporting" of GHG disclosures would help to increase efficiency of supply chain emissions reporting. Defining interoperable standards for exchange could help companies more efficiently report to multiple requestors using different platforms and tools, and increase the granularity, reliability, and timeliness of data, de-risking their disclosures. What's missing is an "orchestration layer" to integrate various standards, specialised platforms and surveys into one unified view of corporate impact.