Supply chain emissions from businesses in the FTSE 100 index rose by 3% last year, new research from supply chain management consultancy INVERTO, part of Boston Consulting Group, has found.
According to INVERTO, an additional 62 million tonnes of CO2 was generated from the supply chains of FTSE 100 firms last year, bringing their total emissions to 3.3 billion tonnes.
This is despite many businesses committing to reducing their Scope 3 emissions – while just under a third (32%) of FTSE 100 companies saw a decrease in supply chain emissions, 37% reported an increase.
‘A long way to go’
“These figures clearly demonstrate that despite the commitments made by businesses, there is still a long way to go to achieve net zero for the UK’s largest companies,” commented Kiren Pandya, principal at INVERTO.
“There is not going to be an easy glidepath to net zero. It will need a thorough strategic review of supply chains, careful planning and hard work.”
At the same time, there are still causes for optimism – 78 of the 100 companies in the index now have a defined emissions reduction strategy in place, a significant improvement from 50 in the prior year.
“The headline emissions figure may not be as good as hoped, but a lot of good progress has been made elsewhere,” Pandya added.
Top emitters
The top five carbon emitters accounted for 92% of all FTSE 100 Scope 3 emissions, with the top ten emitters including oil, gas, mining and engineering firms.
Technology, in particular artificial intelligence, has been identified as a key enabler for firms looking to reduce their emissions – according to BCG, companies leveraging AI for decarbonisation are 4.5 times more likely to achieve meaningful emissions reductions.
Pandya encouraged firms to look at the “low-hanging fruit” when it comes to reducing Scope 3 emissions, adding that “redirecting logistics, sourcing raw materials closer to home where possible, decarbonising transport and negotiating more sustainable methods with suppliers are all achievable ways of reducing a company’s emissions in the short term.” Read more here.
