Time is running out to start translating intention into action
The Scope 3 Maturity Benchmark has shown us that businesses have good intentions but are struggling to make meaningful progress. Seven months after the launch of the initial report, the latest data is painting the same picture – for all the noise and sentiment around Scope 3 in the business community, businesses are not successfully translating words into action.
So, what is the main difference between then and now? A lack of progress in that time is painting an even darker picture for Net Zero targets. Below, we take a closer look into what the Scope 3 Maturity Benchmark is showing us about the current state of progress and highlight what organizations need to do to get to grips with Scope 3.
Effective supplier engagement remains a key piece of the puzzle
Many organizations have an idea of “where” they want to get to on Scope 3 and are cognisant of “why” they want to get there. Where many are falling short, however, is the “how”. Businesses can’t make meaningful progress on Scope 3 alone; they are ultimately reliant on the supply chain making the necessary steps.
Impactful supplier engagement is key for putting a plan on Scope 3 into action, but it remains a big challenge. Recent economic turbulence has not helped, and many businesses are blaming their inability to get sufficient airtime on Scope 3 with their suppliers, as cost remains the top priority for much of the supply chain.
However, the reality is that these economic challenges will be brought under control, and professionals who have oversight of Scope 3 must be in a position to apply the necessary pressure on supply chains when they can. Interim 2030 targets, in some cases, are a contract length away – and to support real change, organizations need to remain focused on Scope 3 and make serious developments to their supplier engagement plan.
The Scope 3 Benchmark identified two key areas where our scores were lower, and those two areas were chosen as the major issues for discussion during our most recent sustainability global company conference. The benchmark has also inspired us to create and contribute to shaping a new supplier engagement strategy
Margarida Martins Almeida, – Supply Management & Sustainability, EDP Global Solutions
Getting your processes in order
Supplier engagement is essential, but the latest findings from the Benchmark have shown that supplier selection processes are causing a significant roadblock to progress and is an area where most are immature. Many organizations are simply adding a few questions within sourcing processes as a “tick box” exercise for suppliers to indicate whether they are taking steps to achieve CO2 reduction. This information is not being prioritized when selecting suppliers, acting more as a “nice to have” than as a requirement, with cost continuing to be the key driver.
If executives begin measuring their departments using Scope 3 as one of the key criteria for success, businesses are more likely to accelerate their progress.
Fresh and relevant data is a huge asset
Accurate and real-time data is key for measuring progress. Our 2023 Supply Chain Barometer showed us that 28% of CEOs identified a lack of access to the correct data as being a key reason their supply chain decarbonization efforts were stalling. Most organizations are tracking emissions data in their own spreadsheets, so data is not being continuously refreshed, and supplier progress (or lack thereof) is not being monitored on an ongoing basis. This makes it difficult to see and measure how suppliers are improving as you are starting your supplier engagement and makes it challenging to identify supplier risks towards your net zero goals.
For those who do want to streamline their data, there is also a glut of options for organizations to choose from when it comes to data and technology. The tech space is continually improving and growing, and the options for sustainable procurement professionals can be overwhelming, making it difficult to know where to start.
Having said this, while it is immensely useful, it’s important not to let perfect data get in the way of making a start on your Scope 3 journey with a number of major organizations making great strides in spite of their data position.
Finding and retaining the right talent
People and talent will ultimately be the catalyst to drive progress on Scope 3, but The Benchmark has shown that talent retention and recruitment is not hitting the mark, achieving the lowest score overall of the twenty-seven variables measured.
Unless there is a significant push for improved carbon literacy training and development, it will be difficult to shift the dial on retaining talent. Professionals who are genuinely passionate about sustainability want to work for organizations that understand their position and challenge and make an impact. If there is not robust education within the broader team and sustainability is not being filtered into decision-making, those professionals will likely move to a company that is acting more knowledgeably and seriously in line with their sustainability values.
Talent retention is a challenge, but the sustainability talent gap is getting wider, not smaller, and there is already a lack of people to fill the “green jobs” that already exist. Although talent is key, it is not necessarily the first area to target when you are looking to solve the Scope 3 problem.
Start by creating an effective net zero strategy and get the ball rolling with sponsorship for your plan, then find the talent to enable growth and solid progress to goals.
We used The Benchmark data to secure a new role in the team, entirely to focus on Scope 3 it also provided assurance and feedback on where we are on our journey. We’ve also used it to inform our sustainable procurement team plan and intend to move forward to work with the procurement leadership team to see the gaps and what we are doing well
Responsible Business Manager, Financial Services Organization
Tools such as The Scope 3 Maturity Benchmark can be used as accelerants for action
Participating organizations have been using the quantitative findings of the Scope 3 Maturity Benchmark as a powerful tool for conversations with executive leadership, using concrete numbers to back up the arguments for why they might be less mature than their peers and how and what, they need to change.
The reasons behind an organization being less mature in their Scope 3 journey vary enormously; it might be that they have high targets but limited internal buy-in, or plenty of awareness but a lack of talent and expertise, and in some cases, a lack of both talent and backing, despite good intentions.
Ultimately, if your suppliers are not aligned with your goals around Scope 3, then you will struggle to make much meaningful progress. Start by doing the initial legwork: establish a net-zero strategy and align on how policies will tie into procurement decisions before identifying the tools that will translate your plan into action. A robust supplier engagement plan is one of those tools that will accelerate progress.
Making a start is a daunting task, but businesses do not have a choice – Scope 3 must be tackled if there is any hope of keeping Net Zero alive. Get in touch to get started now.
