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How to Reduce Your Supply Chain’s Carbon Footprint

Are you doing everything you can to shrink your company’s carbon footprint? You might be recycling, using renewable energy, or even switching your company vehicles to electric or natural gas. But you might be overlooking a huge source of carbon emissions for your company – your supply chain.

Under the Greenhouse Gas (GHG) Protocol, corporate carbon emissions are divided into three categories: Scope 1, Scope 2, and Scope 3. Scope 1 covers emissions that come directly from the company’s owned or controlled assets and operations. Scope 2 covers emissions created in the production of purchased energy, steam, or heat – these emissions aren’t created by the company directly, but by a second entity that produces heat, steam, or energy for sale. 

Scope 3 covers all of the company’s upstream and downstream emissions. These include emissions related to supply chain activities, but they also include emissions related to transportation and distribution, investments, business travel, employee commuting, the use of products by consumers, waste disposal, and even the purchase of goods and services by consumers. Scope 3 emissions account for about 80 percent of most companies’ carbon footprints. 

However, companies have the power to make a big difference in overall carbon emissions by taking action to address their Scope 3 emissions. One way to do that is to make your supply chain more sustainable. You can make supply chains shorter, reduce transportation, and even repair, reuse, or recycle materials and tools to reduce your supply chain’s environmental impact. 

Source Materials Closer to Home

You might save a lot of money sourcing materials and supplies from a supplier far away, but it’s simply not worth it from an environmental perspective. One of the most effective things you can do to reduce your supply chain’s footprint is to shorten your supply chain so that supplies and materials are coming from local manufacturers instead of from someplace halfway around the planet. The need to ship materials, supplies, and products globally is a major driver of greenhouse gas emissions and climate change. Bringing your suppliers closer to home will significantly reduce the fossil fuels needed to transport your materials and supplies, and will make your supply chain more resilient, too. 

Do Less Driving

Transportation is a huge source of Scope 3 emissions, whether it’s a question of the fuel and resources used to ship materials and products through the supply chain, or it’s more an issue of the fuel used to facilitate business travel or employee commutes. You can take steps to lower your supply chain carbon footprint by minimizing the amount of transportation you need in your supply chain. 

You’re already doing that to some extent by ordering supplies and materials from local suppliers, rather than going ahead with suppliers further afield. You can take things up a notch by choosing more environmentally friendly modes of transport for your distribution – use trains or ocean freight to minimize your carbon outlay for distribution. Choose suppliers who also use environmentally conscious means of transport in their own supply chains. Avoid using trucks and planes for shipping whenever possible, but when you do, make sure they’re making every effort to minimize carbon outlays, such as taking proactive steps to reduce dead haul, limit speed, and eliminate idling.

Recycle, Repair, and Reuse

You’re already familiar with the benefits of recycling – you probably already recycle paper and cans around the office. It’s time to bring that same energy to your supply chain. Seek out relationships with suppliers who use recycled materials and who repair equipment whenever possible instead of replacing it unnecessarily. 

You can even lower your carbon footprint on the other side of your supply chain, by encouraging more consumer recycling and repair of your products. Figure out what components of your products can be recycled and set up collection points or otherwise implement some strategy to reclaim them. There are always things that can be reused and recycled, even on the most broken product, and consumers support sustainable initiatives – they’ll help if it means making a difference to reverse climate change. 

When it comes to reducing your company’s carbon footprint, you simply cannot overlook the massive impact that your supply chain has on your overall emissions. Your supply chain probably accounts for 80 percent or more of your company’s carbon emissions and pollution. Unless you take steps to make your supply chain more sustainable, your efforts to be eco-conscious and sustainable in the way you do business will be doomed to failure.

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