We Mean Business Coalition launches the Supplier Cascade to accelerate supply chain decarbonization
We Mean Business Coalition
- New approach helps businesses of all sizes and sectors to tackle their upstream Scope 3 emissions
- Businesses are invited to become Early Adopters of the Supplier Cascade and accelerate decarbonization across their supply chain
The We Mean Business Coalition, in partnership with BSR, CDP, Ceres, EDF and the SME Climate Hub, and in collaboration with the Science Based Targets initiative (SBTi), has launched the Supplier Cascade to accelerate the pace at which businesses reduce their Scope 3 emissions.
Based on existing best practice from business leaders including AstraZeneca, the Supplier Cascade is a practical approach – for businesses of any size and from any sector – designed to overcome barriers to decarbonization by focusing on one area that an organization can directly control: their relationship with Tier 1 suppliers[1].
The approach creates a cascade of climate action through the supply chain, with each organization asking their own Tier 1 suppliers to make a credible net zero commitment that is aligned with science, publicly report their progress against targets, and cascade the approach to their own Tier 1 suppliers[2].
Scope 3 emissions account for more than 70% of a company’s carbon footprint, and the inherent complexities of supply chains makes it hard to accurately track if upstream scope 3 emissions are being reduced.
For many companies, a significant portion of their Scope 3 emissions are from upstream suppliers. However, data from CDP shows that only 39% of these companies report engaging their suppliers on climate matters and just 0.04% currently require their suppliers to set Science Based Targets (SBTs).
The Supplier Cascade provides an action-oriented ask that helps buyers start the process of engaging suppliers with whom they have a direct purchasing relationship and promotes comparability across supplier reporting.
Businesses with science-based targets are being invited to become Early Adopters of the Supplier Cascade, with support provided and key metrics collected to track the impact of the approach. Companies who want to find out more can visit: https://www.wemeanbusinesscoalition.org/suppliercascade
“By joining the Supplier Cascade and encouraging their Tier 1 suppliers to do the same, businesses can send a clear message to incentivize action and increase organizational resilience. Businesses can also increasingly draw on the reporting of their suppliers – and suppliers draw on the reporting of their suppliers – to have more specific and available data on climate action in their upstream supply chain,” said Maria Mendiluce, CEO of the We Mean Business Coalition.
Pharmaceuticals company AstraZeneca is engaging its entire value chain in reducing its Scope 3 emissions. By 2026, AstraZeneca will have reduced its Scope 1 and 2 greenhouse gas emissions by 98%; by 2030, it aims to halve its entire value chain footprint.
Robert Williams, Director of Sustainable Procurement at AstraZeneca, said:
“We were one of the first seven companies in the world to have our net zero targets approved by SBTi, but we know that reducing global emissions is not something that anyone can do alone. Engaging with suppliers is critical for every business – we must all work together to engage our partners and embed decarbonization across value chains.
“We’re urging our supply chain partners to set a clear decarbonisation plan and make it public, to mobilise employees in support of their aims, and to engage their own suppliers to cascade targets upstream too. Together, we can ensure a major knock-on positive impact for people and planet.”
Mendiluce concluded: “The Supplier Cascade has clear benefits as it is measurable, it does not require the visibility of the entire supply chain, it does not require deep technical knowledge so is more straightforward for buyers and procurement teams to implement, and it provides flexibility to business in how they want to engage and incentivize their suppliers.
“Importantly, once this approach has been taken to scale it generates climate action far beyond a company’s own supply chain.”
[1] A Tier 1 supplier is defined as a supplier that sells its goods or services directly to the business.
[2] Tier 1 suppliers will have their own direct Tier 1 suppliers. When these are considered as part of the supply chain for the end business, Tier 1’s direct suppliers will be called a Tier 2 supplier; Tier 2 supplier’s direct suppliers will be called a Tier 3 supplier; and so on.