We are delighted to be able to offer thousands of suppliers access to market-leading supply chain finance linked to sustainability. This programme not only provides suppliers with a real incentive to set science-based emissions reduction targets, it will help embed sustainability goals throughout our supply chain and support the UK in realising its climate change targets.”Ashwin Prasad – Tesco Chief Product Officer
Anthesis has been a trusted advisor to Tesco for over seven years and has been supporting the company by embedding its sustainability goals within its supply chain as part of the Tesco Supplier Network platform. As an industry leader, Tesco was eager to identify novel levers that could be deployed to help incentivise and reward suppliers to take action to deliver on Tesco’s updated supply chain carbon reduction targets (aligned to a 1.5°C pathway) and Net Zero emissions across its entire value chain by 2050.
In partnership with Tesco and their finance partner, Santander, Anthesis supported the development of UK retail’s first sustainability-linked supply chain finance product. The voluntary programme saw Tesco suppliers offered preferential financing rates based on their disclosure of greenhouse gas emissions, setting reduction targets, and delivering reductions. Anthesis led the development of the methodology by which suppliers are assessed. In addition, Anthesis was the implementation partner for the programme, independently reviewing each supplier’s application to the programme.
In line with Tesco’s science-based climate targets and goal to achieve net zero in the UK by 2035, the supply chain finance programme encourages suppliers to work with Tesco to address the most urgent environmental issue, climate change.
Tesco has taken a leadership position as the first UK retailer to offer preferential funding rates linked to suppliers’ sustainability performance. Suppliers that successfully engaged with the programme have been able to access funding at costs below the market rate. Moreover, the programme has incentivised many suppliers to measure their greenhouse gas (GHG) emissions for the first time, set GHG reduction targets in line with Tesco’s goals, establish Net Zero ambitions, and deliver emission reductions.
Anthesis has supported Tesco to design the methodology that determines how suppliers’ sustainability credentials are assessed. In addition, the team assisted with collecting and reviewing supplier data, as well as supporting Tesco with the continued evolution of the initiative over time – in line with the retailer’s sustainability goals.
Anthesis has been working with Tesco since 2014 to advance its supply chain sustainability agenda. This has included developing and delivering the Tesco Supplier Network, Tesco’s online supplier collaboration platform, which gives over 10,000 suppliers and producers access to guidance materials to improve sustainability.