Lack of data on supply chain emissions risks 'unintentional greenwashing'

17 March 2023

Half of organisations struggle to obtain reliable data on their scope three emissions, making it “virtually impossible” to assess their true environmental impact, according to a survey. 

Businesses must “radically improve” the visibility and measurement of scope three emissions data or risk “creating a wave of unintentional greenwashing” and an inability to achieve progress on carbon reduction, according to procurement platform Ivalua.  

Ivalua found 51% of businesses lacked visibility into tier two and three suppliers, 50% suffered from poor data quality on emissions, and 37% had difficulty collaborating to overcome challenges posed by scope three emissions.

Alex Saric, chief marketing officer at Ivalua, said: “The UK government and businesses must urgently resolve the scope three measurement conundrum. Failure to do so could result in a wave of unintentional greenwashing, with companies trying to demonstrate they are achieving net zero goals, but failing because they cannot obtain or report accurately on scope three emissions. 

“This is often because organisations suffer from incomplete, absent or unreliable supplier data. While they may have some visibility into scope three emissions for critical suppliers, few have that transparency into all immediate suppliers and deeper into their supply chains. This lack of visibility could leave efforts to provide environmental transparency at a complete impasse.”

Science based targets are required to ensure consistency in reporting standards, Saric said, and the government should support businesses by outlining the reporting requirements firms should adhere to.

Saric further argued procurement teams are uniquely positioned to push transparency throughout the business. 

Saric continued: “Procurement has a central role to play in establishing transparent emissions measurements. Their proximity to suppliers means they can work directly with them to obtain the data needed, or source it from third-party data sources to accurately report on emissions targets. 

“By assessing emissions at the product and category level, procurement teams can accurately report on progress, and identify areas to collaborate with suppliers on reducing emissions to ensure they are making meaningful progress on net zero pledges.”

Ivalua’s comments come in light of an independent review into net zero by former energy minister Chris Skidmore, which argued the government should provide more support to businesses to help them measure emissions through their supply chains. 

 Want to stay up to date with the news? Sign up to our daily bulletin.

CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates