Verifying supply chain sustainability depends on companies having ready access to carbon emissions numbers at every stage of product development. But what happens when some suppliers are unable or unwilling to provide that critical data? The need becomes even more pressing as regulators mandate the reporting of Scope 3 emissions, those generated by supply chain partners over which a manufacturer, retailer, brand or distributor has no direct control. Yet that information is also the most difficult to obtain.
The stakes are especially high when measuring the impact of food supply chains, which contribute about one-quarter of global emissions overall. "Suppliers are not as responsive to brands as they need to be in order to get that accurate data," says Cate Battey, director of growth and innovation at HowGood, a food sustainability database with more than 90,000 emission points around the world. The reasons are many. Battey says suppliers may be at varying stages of maturity in their ability to collect and dispense sustainability data and may lack the time and resources to address questions from brands and retailers.
Concerns over data privacy and security can also play a role. Battey emphasizes that the challenge is largely one of education, enlightenment and collaboration. "It's about finding how to engage suppliers in ways that are going to empower them." Suppliers can also become frustrated by the differing data demands of their many downstream buyers. HowGood's supplier connection platform addresses that problem by simplifying and standardizing the type of product-level data required.
From a supply chain perspective, Scope 3 reporting is becoming mandatory under the CSRD (Corporate Sustainability Reporting Directive) and the SEC Climate Rule, and combines with food-sector FLAG (Forest, Land and Agriculture) targets to create an additional layer of complexity. Nestlé, Unilever, Danone and PepsiCo are embedding sustainability data quality into their supplier scorecards. SAP Sustainability Footprint Management and Salesforce Net Zero Cloud are emerging as the leading platforms in data collection infrastructure.
