The benefits of setting carbon targets for the supply chain
After construction firm Multiplex Europe had an ambition to reduce direct emissions by 30% by 2030 approved by the Science Based Targets initiative (SBTi), the firm's sustainability manager Pavan Juttla explores how target setting can strengthen relations with the supply chain.
Setting carbon targets for the supply chain is like the tap of the first domino. It has the power to create a ripple effect of positive change in behaviour and performance across your entire network, and I am excited that Multiplex Europe is on this ‘domino journey’.
All businesses have sustainability goals, targets and progress indicators, and an action plan (I hope!) to achieve these. Companies’ supply chain partners often have a role within that action plan, although, on many occasions, this crucial relationship is not explored to its full potential.
Setting targets that have the potential to spark large-scale change means that businesses must engage further with the supply chain to better understand their capabilities, goals and incentives. On the flipside, if supply chain partners understand your motivation, this can act as an additional stimulus for them to work on reducing their carbon footprint.
There are many benefits that can come from implementing targets across your network – probably some we are not even aware of yet. I have picked out three benefits in particular that we have experienced at Multiplex Europe, even whilst being at the very early stages of our Science Based Target supply chain engagement journey.
Firstly, setting targets for the supply chain opens up an important conversation about carbon, both internally and externally. The conversation transpires across three key stakeholder groups: internal heads of departments, sustainability teams in competitor companies and the senior management of the supply chain. All three groups are interconnected, for example, internal stakeholders manage the supply chain, the supply chain works directly with other competitors, and a collective effort amongst competitors can create a big impact in the industry. Together we can achieve much more. On one of our residential projects in London, we were able to eliminate certain single-use plastic packaging waste by working with our supply chain to a common goal. In this way, we can encourage the industry to address the critical issues around carbon, such as collecting the data, identifying the opportunities and breaking down the barriers.
Subsequently, opening up the conversation about carbon can enable internal stakeholders to integrate carbon performance into the core business function. For example, it is an opportunity to encourage the buying team to consider energy performance within the procurement process. This helps to embed the carbon and sustainability agenda into business processes in a more holistic approach.
Finally, and this is probably the most important point, we must empower our supply chain to set carbon targets, rather than make it a requirement that they are left to figure out themselves. Therefore we want to build their capacity in understanding their own carbon footprint, so they can develop ambitious targets and robust plans to achieve them. Taking this one step further, we also want to work closely with our clients and their design teams, so we can support them on their carbon footprint journey too. We can inform and inspire them with the benefits of setting carbon targets and reducing their footprint. This is where the ‘domino effect’ truly comes into fruition, because if we can help equip our network with the tools and knowledge to reduce their carbon footprint, they can apply this across all of their operations (not just ours) and also downstream amongst their own supply chain.
This is how setting carbon targets for the supply chain can have a powerful ripple effect across the whole industry.