Supply chain footprints: interesting but unlikely to become mainstream
The Carbon Disclosure Project yesterday announced a few results from its ‘Supply Chain Leadership Collaboration’ (press release – pdf) – but not the actual figures.
Companies like Procter and Gamble, Unilever and Tesco have been requesting carbon footprint data from their suppliers. The purpose of the project is to measure “carbon risks and liabilities in the supply chain”.
Measuring emissions in a supply chain can be useful because it gives a vague idea of what carbon costs might be passed through if carbon costs rise in the future and, from a CSR perspective, it can help pressure suppliers into cleaning up.
Don’t anticipate measurement of supply chain footprints to become commonplace in the future, because:
- It is very difficult and inaccurate. You can’t really go beyond first tier suppliers and, while it is relatively simple for a supplier to measure its corporate direct emissions, it is complex and subjective to divide the emissions up between its customers; and
- Supply chain carbon footprints will never be regulated because it would be over-complicated and involve double counting (if you penalise a company for buying from a dirty supplier, do you also penalise the supplier for being dirty?). Instead, costs imposed on direct emissions will be passed through the supply chain.