Businesses are well aware of the importance of reducing their carbon footprints internally, in order to have a better influence on both the community and the environment. What we don’t always realise is that a large percentage of a business’s corporate carbon emissions reside in external supply chain processes. If companies don’t take this into account, large opportunities to reduce their carbon costs could be missed.
This means going outside your four walls in measuring your carbon footprint – a task that may seem quite complex and overwhelming. However, various different tools and approaches have been developed to ensure that reducing one’s overall footprint can be a refreshing challenge for any company and will eventually also be beneficial for the employees.
There are several reasons for why this is essential for all forward thinking organisations, especially in an environment where reducing carbon emissions is becoming a critical business issue. Here are just a few:
- Anticipating future costs
With carbon pricing and taxes coming into play, taking your entire supply chain into account is a good exercise to see how costs in your supply chain may escalate over the next few years – something we don’t always consider and don’t necessarily want to start thinking about.
- Expanding your influence
By focusing on more than just your own business, your sphere of influence can be broadened and your business could play a meaningful part in encouraging suppliers, as well as customers, to also start reducing their emissions. Suppliers should realise that it will be necessary for them to adapt to this if they want to continue being part of your supply chain.
- Understanding your impacts
Reviewing the carbon footprint of your entire supply chain should give you a true reflection of the overall environmental impact of your business activities. It’s always good to understand where your biggest impacts are, and often these fall outside your four walls.
- Encouraging innovations
Constantly evaluating and assessing your supply chain and exploring how you could make improvements will encourage innovation in product design. This includes examples such as changing product design for more efficient product distribution or use, allowing the company to improve the energy efficiency of products, altering the packaging and so on.
- Choosing business partners
Keeping the carbon emissions of your supply chain in mind when deciding who to do business with will allow you to choose more efficient business partners, which better mitigates risk and may yield cost reductions. Greening your supply chain can achieve reputational and efficiency gains, savings to the bottom line and ultimately increase revenue. Therefore, in the long-term, who you select as business partners will become increasingly important.
Keeping all of these reasons in mind, it’s clear that companies with a full understanding of their carbon emissions, from their suppliers to their customers, will be better able to measure, manage and reduce them. If you would like to find out how to reduce your carbon emissions, please feel free to get in touch with us.