Accelerating the Transition to Better Scope 3 Data and Faster Decarbonisation

Michael Lenaghan

Director of Impact Intelligence

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Michael Lenaghan

Michael applies expertise in lifecycle assessment and circular economy principles to help organisations translate environmental data into decisive climate action.

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Table of Contents

• Scope 3: theory vs. reality
• The scope 3 data deadlock
• Breaking the deadlock
• Guided Series: Better Scope 3 Data

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Scope 3: theory vs. reality

Scope 3 emissions dominate most corporate carbon footprints, and reducing them is essential to achieving net zero. In theory, companies can manage scope 3 emissions by using supplier-level carbon data to both understand where emissions sit and inform the decisions needed to reduce them.

Unfortunately, the reality of addressing scope 3 emissions is not that straightforward. Most suppliers do not yet have the capability to generate the level of carbon data on their products and services that is required for companies to make meaningful purchasing decisions. Building that capability takes time, investment, and new processes.

The scope 3 data deadlock

Effective Scope 3 decarbonisation requires action from both companies (buyers) and their suppliers. To play their respective roles, both need better data.

Suppliers control how products are made, what they are made of, and where they are produced, putting them in a strong position to reduce emissions for themselves and their buyers. To act, they need primary data to identify hotspots, implement reduction measures, and measure the effect of those actions over time.

Buyers looking for lower-carbon products and services generate commercial incentives for suppliers to disclose and decarbonise. To make these procurement decisions, they need high-quality supplier data to operationalise lower-carbon procurement, thereby creating the commercial incentives for suppliers to disclose and decarbonise. 

This creates a “chicken and egg” dynamic.

Suppliers must generate the data needed for both parties to act, but doing so requires a significant capability build – one they are unlikely to invest in without a clear commercial signal from their customers.

Buyers create that signal by operationalising lower-carbon procurement, but cannot do so without actionable supplier data.

Breaking the deadlock

Luckily companies do not need to wait for perfect supplier data to act. They simply need enough data to differentiate between suppliers in a way that influences decisions and begins to push the procurement needle toward lower carbon products and services.

Breaking the deadlock requires a structured, long-term programme that both:

1. Uses readily available supplier data today to improve reporting and begin operationalising lower-carbon procurement.
2. Creates the conditions needed to accelerate supplier data capability and decarbonisation over time.

This, in turn, requires a focus on four areas:

1. A pragmatic approach to data: Ensure you are asking your suppliers for the right data – whether that be corporate carbon footprints (CCFs) or product carbon footprints (PCFs). Where suppliers are not yet ready to provide complete carbon footprints themselves, consider generating them internally using existing data while suppliers build the capability needed to meet growing footprint demand.
2. Embedding carbon into commercial decision-making: Develop a procurement approach that incorporates carbon considerations. In addition to weighting on carbon footprint emissions, incorporate scoring that recognises improvement in disclosure, data quality, and carbon performance while making the pace of progress a strong competitive advantage.
3. Making it easy for suppliers to respond: Clearly indicate why requests for data and footprints are a commercial opportunity for suppliers, as opposed to a compliance burden. Wherever possible, adopt existing industry standards and align to common approaches – this increases the likelihood suppliers will be able to fulfil your request.
4. Continuous improvement over time: The priority is first to begin, then to build momentum. Consider starting with a subset of suppliers to test initial approaches, then work to expand and improve the programme over time.

Take a deeper dive into each of these focus areas and more in our free, five-week guided email series on better scope 3 data. Throughout the series, we share expert advice, additional resources, and practical next steps that can be completed each week to get started on the path to faster decarbonisation today.

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