As we reckon with the impact human influence has played in warming the climate, pressure mounts on businesses, especially large corporations, to reverse climate change. In recent years, many Fortune 500 companies set aggressive climate goals to reach carbon neutrality before it’s too late. But there’s a snag: up to 85% to 95% of these companies’ greenhouse gas emissions are not under the direct control of the company.

According to the most widely used international carbon accounting tool, The Greenhouse Gas Protocol, direct emissions from operations (Scope 1) and indirect emissions from purchased energy (Scope 2) make up only a fraction of an organization’s carbon footprint. The rest are classified as Scope 3 and represent the strong majority of most organizations’ emissions. These are the carbon emissions from the entire value chain, including assets owned or controlled by third-party vendors. Without collaborative efforts among vendors and organizations to optimize operations and share the results, Scope 3 emissions remain challenging to report and even more challenging to improve.

Scope 3 emissions are difficult to track as they occur outside of an organization’s direct operations and control. But as pressure grows for accountability and action, major companies, like Apple, Amazon, and Walmart, are ready to track, report, and execute a plan of action to tackle Scope 3 emissions and achieve true carbon neutrality -- but they can’t do it alone. Now the pressure passes on to commercial and industrial (C&I) vendors throughout the supply chain to clean up their operations and provide accurate reports of carbon emissions.

Are these small and medium-sized C&I vendors prepared to address their own carbon emissions? Historically, the answer is no. They often lack the energy expertise and capital to tackle their emissions while successfully running their businesses. But as the recent  IPCC Climate Report clearly states, climate catastrophe is imminent. Small to medium C&I companies need simplified energy decisions to cut carbon emissions and drive the adoption of clean energy solutions. 

Scope 3 Solution

The adoption of climate-friendly products and services through a simplified decision-making process must involve energy experts and management firms. In a fragmented industry, tailored systems curated to fit the energy needs of any organization will bridge the gap between Scope 3 emissions and true carbon neutrality. With expert energy management firms involved, not only do carbon footprints shrink, but decisions are rooted in bottom-line value with a clear return on investment. 

Achieving Fortune 500 net-zero goals is not possible without tackling Scope 3 emissions. The key to addressing Scope 3 emissions is to streamline the energy decision-making process for the wide array of small and medium-sized vendors. Between expert energy solutions and an intuitive, value-based decision-making process, the pain can be removed from energy decisions and equip vendors across the supply chain with the necessary tools and practices to offset Scope 3 emissions.