In the last ten years, corporate promises and initiatives to promote sustainable business practices that reduce the carbon footprints of massive organizations have emerged across all industries. More than ever before, emissions and carbon accounting are a central part of executive-level boardroom conversations and businesses are clamoring to meet consumer demand for a greener future.
But the gap between a promise to make progress and acting on those goals remains wide for many organizations. At the corporate level, awareness and momentum to mitigate scope 1 and scope 2 emissions is more widely prevalent.
These emissions, which encompass both owned and purchased emissions sources (like electricity to power facilities) are often cited in corporate social responsibility (CSR) and sustainability reports, and they tend to make headlines when corporations make big statements about reducing their carbon footprint to the public.
But many of these plans are missing a key component to unlocking significant emissions reductions, and that key lies within companies’ transportation networks.
Scope 3 Emissions and the Transportation Supply Chain
Significant opportunity exists in the last scope — scope 3 emissions — that can unlock even greater gains in sustainability and emissions reduction. Scope 3, or “value chain emissions,” make up all indirect emissions outside of scope 1 and 2.
What makes scope 3 emissions such a tough nut to crack is that they contribute to an organization’s overall carbon footprint, but they come from sources out of their direct control. Because they comprise up to 90% of many companies’ reported emissions, they are incredibly difficult to track, quantify, and even identify which areas of the value chain are the biggest contributors — and which areas stand the most to gain.
But their potential for impact is incredibly large, especially in transportation-related categories. According to the U.S. Energy Information Administration, as of 2015, the transportation sector surpassed power generation to produce the largest percentage of CO2 emissions from energy consumption in the U.S. It also represents one of the top three categories of emissions for most organizations, particularly when considering both upstream and downstream sources.
Though it may be daunting to tackle its complexity, your transportation team has some of the most diverse opportunities to influence and drive forward GHG reduction in your organization’s operations.
Tackling the Complexity of Transportation Emissions
Because of the large number of partners typically involved in an organization’s transportation network, gathering data and information to calculate scope 3 transportation emissions is challenging, but not impossible. Many shippers have partners dedicated to their transportation and energy strategies that can tap into data on characteristics like weight and volume, unique modes and equipment, and exact mileage on shipments across their networks.
Once you employ validated and trustworthy data to create a solid baseline, calculating and improving your network’s emissions impact becomes iterative. This creates a shared starting point from which cross-functional teams can operate from, making every next step easier to track and measure. Every emissions reduction strategy has to begin somewhere and using what is currently available while also leveraging existing industry relationships to understand data is a great start.
In the process of unlocking your sustainability goals using scope 3 emissions you’ll also find other indirect benefits that ripple out into the rest of your strategy — stronger supplier relationships, more data and information shared across teams, interdisciplinary collaboration, and better communication with executive leaders. Trusted partnerships, both internal and external, are a critical element in an emissions strategy, regardless of scope, but scope 3 emissions remain an untapped opportunity for your organization’s sustainability strategy.
Brett Wetzel is Senior Director of Applied Knowledge at Breakthrough. Brett’s leadership at Breakthrough leverages an interdisciplinary background so that our clients are supported with the data, information, and roadmap needed to navigate the complexities of the industry today. His background serving clients and deep freight and energy expertise developed while leading the Applied Knowledge team helps him push Breakthrough’s research and analysis to new heights, uncovering new opportunities to give our clients a competitive advantage in the market.