Sheena Patel is a Director and Alessandra Del Centina is a Managing Consultant and sustainability capability lead at Vendigital. They recently shared their insights with Manufacturing & Logistics IT.
Most manufacturers are aware of their responsibility to reduce direct carbon emissions within their operations, known as Scope 1 emissions. However, as climate targets approach, the need to extend and accelerate decarbonisation objectives is growing, and some manufacturers could be doing more to tackle Scope 2 emissions – those resulting from the generation of purchased energy – and Scope 3 emissions – those produced throughout the whole value chain.
According to the CDP, Scope 3 emissions in the supply chain account for 11.4 times the amount of a business’ direct emissions. It’s therefore vital that organisations extend their commitment to decarbonisation to cover the whole value chain – from inception to end user. But where should they start? Reducing emissions that lie outside of an organisation’s direct control could seem impossible – however, with the right knowledge and attitude, it can be done. Here are five simple considerations to help manufacturers to speed up decarbonisation:
Seek out renewable energy sources
Manufacturing processes rely on energy – but businesses should be getting as much as possible from renewable sources. This is because every organisation’s Scope 2 emissions are another’s Scope 3 emissions. Taking responsibility for how energy is sourced can reduce Scope 3 emissions not just for your business, but for others throughout the value chain. Larger companies could consider forming sustainable partnerships with other organisations to invest in renewable energy systems or facilities – enabling others to reduce their Scope 2 and 3 emissions simultaneously.
Close the loop
Closed loop or circular models can dramatically reduce emissions by allowing companies to reduce, reuse or recycle waste materials or by-products. This has the effect of reducing waste from the supply chain as a whole – lowering Scope 3 emissions. Manufacturers should re-examine design principles and materials with ‘closed loop’ thinking in mind.
Sell sustainably
While manufacturers might not be able to influence how customers and end users utilise their products, they can control sales and distribution processes. This could include the electrification of logistics operations, or even bringing logistics in-house to control emissions. Businesses should also look at relationships with core retailers to make improvements, for example by reducing packaging or understanding the retailer’s own commitment to decarbonisation.
Culture is key
Change must happen at a cultural level involving employees and external parties across the value chain. Employee initiatives could include cycle-to-work schemes or providing shuttle buses to reduce vehicle emissions. To address emissions across the value chain, manufacturers can update their tendering process to ensure new suppliers align to their decarbonisation processes and goals, while simultaneously discussing updates with current suppliers at strategic points within the relationship.
Digitisation as a tool
While digitisation can’t solve the issue of Scope 3 emissions, it has a vital role to play. Digital tools can accurately measure carbon emissions and track progress – quickly highlighting potential blockages. Accurate and reliable data can help a business to focus on areas of maximum impact, reducing the time it takes to make decisions and realising successes and financial savings as decarbonisation initiatives progress
Recent research shows that while the vast majority of businesses report having Net Zero targets in place, less than two out of 10 currently measure Scope 1, 2 and 3 emissions. By utilising data to measure emissions effectively, re-examining design principles and seeking professional advice where appropriate, manufacturers can quickly make a positive impact.
Actively embedding decarbonisation principles can bring a host of benefits, including improved customer loyalty and employee retention, as well as reassuring stakeholders that the business is doing the right thing for the environment and supporting its supply partners too.
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