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Navigating Scope 3 Emissions: Key Considerations When Selecting a Carrier

Sep 7, 2023 | ESG

It’s more important than ever for companies to include Scope 3 emission reductions as part of their overall sustainability goals.

Aside from reducing their environmental impact, addressing Scope 3 emissions can also help companies prepare for regulatory changes, align with shifting investor and consumer expectations and promote a resilient future. For example, governments and regulatory bodies across the globe are increasing the emphasis on Scope 3 emissions within their sustainability reporting frameworks. By proactively addressing these emissions, companies can stay ahead of evolving regulations, demonstrate their commitment to environmental responsibility and mitigate future risks.

To ignore this emissions type is to overlook a significant portion of a company’s carbon footprint, often representing more than 70 percent of total emissions. Measuring and implementing strategies to reduce Scope 3 emissions is crucial for our planet and supply chain resilience.

However, the challenge with Scope 3 is that they’re not directly under a company’s control and are often spread across 15 emissions categories, such as Purchased Goods & Services, Business Travel, Processing of Sold Goods and more.

We recommend a focused approach for those companies looking to reduce Scope 3 emissions but need help getting started. Review the categories below to seek out any ‘quick wins’ while you develop a larger strategy. Typically, a great place to start is the transportation and distribution of your products – by partnering with an aligned logistics and supply chain partner, you can begin to drive reductions and embrace innovation.

Challenges with Scope 3 Emissions
Tackling Scope 3 can feel daunting to many organizations. These emissions typically account for much of an organization’s carbon footprint, are indirect, and occur across all operational activities, meaning a company will face many challenges with addressing its Scope 3 impact.

  1. Reporting: A company must first measure and report on its Scope 3 emissions data to set reduction benchmarks and goals. However, there is often a lack of data or visibility into data for each emissions category.
  2. Regulations: Government entities continue introducing new emissions reporting rules and regulations, forcing companies to pivot and evolve in response.

Companies should ensure they are partnering with external organizations that understand the importance of data and make it accessible to their customers to inform and support emission reduction progress and regulatory compliance.

Despite these challenges, progress toward measuring and reducing Scope 3 emissions is possible. And an excellent place to start is with your supply chain.

Understanding a Transportation Provider’s Role in Scope 3
On average, supply chain emissions are 11.4 times higher than operational emissions. This means an immense opportunity exists to drive carbon reductions by focusing on supply chain-related impacts, specifically transportation. However, to see results, companies need to collaborate with a logistics partner with aligned goals who can help measure Scope 3 emissions and drive reductions.

There are a few key considerations to keep in mind when evaluating a carrier – by focusing on the following, companies will get smarter and more strategic about Scope 3 emissions: 

Goal Alignment & Tangible Action Plans
Select a carrier with sustainability goals that align with your own. Seek out carriers prioritizing Scope 3 emissions reduction and demonstrating a genuine commitment to sustainability throughout their operations.

Beyond setting goals, it’s also important to partner with carriers that have established and implemented comprehensive strategies for driving results. Ensure your potential provider is taking steps toward emission reduction targets and setting new goals as needed.

Transparency and Open Communication
Look for transportation providers who voluntarily disclose their emissions data, including fuel consumption, vehicle efficiency and carbon emissions. Accurate data and accessible reporting will allow you to better understand a carrier’s commitment to reducing Scope 3 emissions.

That transparency extends beyond a carrier’s emissions data to encompass their communication channels, customer engagement and partnerships. Consider carriers that actively communicate with their customers about sustainability goals and initiatives. The right carrier will happily respond to inquiries, share best practices, and work with partners and suppliers to ideate new ways to cut emissions across the supply chain.

Dedication to Innovation
Look for carriers that invest in and test advanced technologies and solutions to minimize their environmental impact. Even if a solution does not turn out to be the right one long-term, it’s a step towards broader progress and shows initiative towards change.

Moreover, carriers actively collaborating with stakeholders and participating in industry-wide sustainability initiatives are more likely to foster innovation. Assess a carrier’s engagement in research and development programs focused on sustainable transportation practices.

By partnering with the right transportation partner, you can actively contribute to reducing the footprint of your Scope 3 emissions. Remember, choosing a transportation carrier is not just a business decision; it is an opportunity to drive positive change, promote sustainability and shape the future of transportation.

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