Your suppliers’ carbon emissions are your emissions. Your customers’ emissions are your emissions.  

This is the new world that manufacturers are stepping into. 

European manufacturers, going forward, will have to track and report all supply chain carbon emissions – from up and down the supply chain. 

What will it look like, to gather carbon emissions data from your suppliers?  

How will you estimate carbon emissions from your customers? 

This article will walk you through the challenges of gathering and reporting carbon emissions data throughout your supply chain – and speak to how carbon accounting software can help. 

Challenges of Reporting Scope 3 & Supply Chain Carbon Emissions 

In the new world of the EU’s Corporate Sustainability Reporting Directive, manufacturers will have to report on carbon emissions from their own operations (“Scope 1 and Scope 2 emissions”) as well as on carbon emissions from their entire supply chain (“Scope 3 emissions”).  

This article will focus on Scope 3 supply chain carbon emissions, and how carbon accounting software can help.  

For a comprehensive view of sustainability and carbon reporting, see Sustainability & Carbon Reporting in Manufacturing. 

Supply Chain Carbon Emissions – Knowing what needs to be Reported 

Proper reporting of Scope 3 carbon emissions depends on what is being supplied, how the created products are going to be used, and other business activities. It also depends on how it fits into one of the 15 Scope 3 categories. 

Scope 3 emissions must be categorized into one of 15 Scope 3 categories, ranging from purchased goods & services, to employee commuting, to end-of-life treatment of sold products. 

Each of the 15 Scope 3 categories requires reporting in a particular format. One of the most fundamental challenges to Scope 3 reporting will be understanding what needs to be reported for each of the 15 categories, and how that data needs to be formatted. 

Scope 3 Carbon Emissions – Creating a Holistic View of All your Suppliers 

Understanding where your supplies come from can be a challenge of its own. 

This can be especially true for multi-site operations, such as automotive and aerospace manufacturers. Each site can have hundreds or thousands of suppliers, and those suppliers can change over time and over projects. 

Simply maintaining an up-to-date library of suppliers – with details as to the category of Scope 3 carbon emissions data for each – can be a monumental task. 

Reporting on Supplier Emissions – Staying on top of Emissions Requests 

Staying on top of CSRD reporting compliance will require regular emissions requests to your suppliers. 

You’re going to need a system that can tell you who has supplied you with what, over different time periods. 

As stated before – your suppliers are going to change from one period to the next. This can be due to seasonal changes in your supply needs, it can be due to new orders from new business, it can be due to changes to your current operating practices, or to swapping supply partners.  

Whatever the source of these changes, you’re going to need to have a robust way to send carbon emissions data requests to all of your relevant suppliers for a given period. Preferably, you’ll be able to send these requests directly from your record-keeping repository. 

Supplier Emissions – Validations & Approvals 

Even if your suppliers comply promptly with carbon emissions data requests, you’re going to have to spend some time validating and approving their submissions. 

There are 15 different categories of Scope 3 carbon emissions, and many of them require reporting in specific formats. 

Have your suppliers provided emissions data for all required categories of reporting? 

Have they provided carbon emissions data in the format required for compliance? 

These things are going to have to be validated. 

You’re going to have to develop systems to get the right people to validate different Scope 3 reports, and to approve them when they’re satisfied. 

Supplier Reporting Issues – What if they Don’t have the Data? 

There’s no guarantee that your suppliers are ready to provide you with the data you need. 

Carbon emissions reporting requires a learning curve, and there are likely organisations that have not progressed as quickly as they may have planned to. 

If one of your suppliers is lagging behind, you may have to provide them with methodologies or data for calculating or estimating carbon emissions.  

Aggregating Scope 3 Supplier Emissions 

Finally – there can be challenges with aggregating your suppliers’ carbon emissions data for your own all-up reporting. 

Aggregating is going to be tough if you don’t have a single comprehensive source-of -truth platform. You’re going to need a system for managing, tracking, and aggregating supplier emissions reports.  And you may need a method for translating carbon emissions data from one metric to another. 

Supplier Emissions – How Carbon Accounting Software can Help 

Each of the above challenges can present complications on your journey towards decarbonising.  

But each of these challenges can be mitigated through the use of carbon accounting software. 

Carbon Reporting Software – Preparing your Suppliers 

The Greenhouse Gas Protocol recommends engaging with your suppliers early to establish ways of working. A comprehensive carbon accounting software solution provides rich frameworks for preparing your suppliers for the days ahead. 

Mavarick’s carbon accounting software includes templates for managing requests for all 15 different categories of Scope 3 reporting data. Mavarick’s reporting request interface even allows you to provide your suppliers with mechanisms for calculating different emissions types.  

With Mavarick, you can help your suppliers manage compliance with CSRD, even if they’re behind the curve.  

Carbon Accounting Software – Clear Communications & Collaboration 

A good carbon reporting software package will help you ensure timely and constructive collaboration with your supply partners. 

Mavarick’s carbon reporting software is the single-source-of-truth platform for managing all of your supply partners, and managing their CSRD reporting. You can construct and send your reporting request communications within the Mavarick interface, including dynamic templates that suppliers can complete online.  

The supplier portal within Mavarick is searchable, including by time period, so that you can identify all suppliers that provided goods within a particular interval. 

Carbon Accounting Software – Command and Control 

An effective carbon reporting software solution will provide a simple interface for sharing reports with colleagues, to manage validations and approvals processes. Additionally, a strong carbon accounting system will make it simple to aggregate periodic reporting.   

With Mavarick, users can assign validation and approval tasks to others within the Org, and automated reminders are dispatched to ensure follow-through. 

Calculations and aggregations for different categories of Scope 3 emissions are carried out within the Mavarick interface, so that tracking and reporting is simple. 

Talk to Mavarick today to learn how we can help you simplify Scope 3 carbon reporting.