Reducing Scope 3 emissions has become a critical priority for businesses seeking to minimise their environmental footprint and align with global climate goals. While addressing Scope 3 emissions is more complex, they are critical since they can make up a significant amount of a company’s overall emissions.
For many businesses, especially those in sectors with extensive supply chains, these emissions can represent between 70 and 90 percent of total emissions. Below, we share best practices for reducing Scope 3 carbon emissions across several industries, offering insights into how companies can address these emissions in their sustainability strategies.Â
Scope 3 emissions definition
Scope 3 emissions refer to the indirect greenhouse gas emissions that occur along a company’s entire value chain, outside of its direct operations. These emissions are part of the three-category framework created by the Greenhouse Gas Protocol to help businesses measure and manage their environmental impact.
Scope 3 covers emissions associated with a company’s broader activities and supply chain. This includes emissions from:
- Purchased goods and services:Â Emissions from the production of goods and services a company buys, like raw materials or office supplies.
- Upstream transportation and distribution: Emissions generated from transporting and distributing products, including supplier-related logistics.
- Waste generated in operations:Â Emissions from waste disposal and treatment processes.
- Employee commuting and business travel: Emissions from employees’ daily commutes and business-related travel.
- Downstream transportation and distribution:Â Emissions from transporting and distributing products to customers.
- Use of sold products: Emissions resulting from customers’ use of the products, especially if they involve energy consumption, such as electronics.
- End-of-life treatment of sold products:Â Emissions from the disposal or recycling of products sold, such as packaging waste or decommissioned electronics.
- Investments and franchises:Â Emissions linked to investments or franchises in which the company has a financial stake, if applicable.
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Industry-specific approaches
Below, we share some industry-specific approaches to reduce Scope 3 emissions in various industries.
Manufacturing
Sustainable sourcing and procurement is a key strategy for reducing emissions in the supply chain. By partnering with suppliers who prioritise sustainability, such as those using renewable energy and minimising waste, businesses can actively reduce Scope 3 emissions.Â
Prioritising suppliers that offer low-carbon products and materials can further support efforts to achieve a more sustainable supply chain. Another effective approach for those in manufacturing is optimising product design and materials. In other words, designing products with lightweight or recycled materials to lower emissions associated with material extraction and processing.Â
Furthermore, designing for longevity, repairability, and recyclability reduces lifecycle emissions. Supplier engagement and training can also improve carbon reduction efforts across the supply chain. By collaborating with suppliers to adopt energy-efficient processes and providing training on sustainability, companies can drive collective progress toward emission reduction goals.Â
Reducing waste in production and packaging is another essential area. Those working in the manufacturing industry should consider implementing lean manufacturing practices to minimise material waste. Moreover, they can use recyclable or biodegradable packaging to further curb emissions from waste disposal.Â
Retail
To reduce Scope 3 emissions, the retail industry can adopt several best practices. Green product sourcing is a crucial first step, where retailers prioritise products from manufacturers and suppliers committed to low-emission practices, energy efficiency, and sustainable materials. By establishing sustainability criteria, retailers can ensure that the products they sell contribute minimally to carbon emissions from production through to distribution.
Sustainable logistics and distribution play a significant role in cutting emissions associated with transportation. Partnering with logistics providers who use electric vehicles or low-emission fuels can substantially lower emissions. Additionally, consolidating shipments to reduce transport frequency enhances fuel efficiency, making the supply chain more sustainable.
To address downstream emissions, retailers can implement customer returns and recycling programmes. By encouraging take-back options for packaging or old products and promoting recycling or re-commerce initiatives, retailers can reduce waste and emissions generated after the point of sale.
Finally, educating consumers on sustainable consumption is key to fostering more eco-friendly shopping habits. Through marketing and product labelling, retailers can inform customers about the environmental impact of their purchases, encouraging sustainable choices that ultimately lower the product lifecycle’s emissions footprint.Â
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Transportation and logistics
Companies in the transportation and logistics industry can begin tackling Scope 3 emissions by focusing on fleet electrification and alternative fuels. Investing in electric or hybrid vehicles and exploring biofuels or hydrogen-powered options can significantly cut emissions from goods transportation. This transition to low-emission fleet options helps companies reduce their carbon footprint and aligns with evolving sustainability standards.
Another effective strategy is optimised route planning and load efficiency. By using advanced software for route optimisation, companies can minimise fuel consumption and emissions, ensuring that each journey is as efficient as possible. Additionally, increasing load efficiency maximises the amount of goods transported per trip, ultimately reducing the total number of trips and, therefore, emissions.
Collaborative logistics offers further emission reduction opportunities by allowing companies to partner with others to share logistics resources and coordinate delivery schedules. This collaborative approach minimises the need for additional vehicles and resources, making the logistics process more sustainable.
Lastly, engaging with suppliers on emissions is crucial. By working closely with fuel providers and vehicle manufacturers, companies can adopt and encourage low-emission technologies and fuel options. Encouraging suppliers to report and work towards reducing their own emissions extends sustainability efforts throughout the supply chain.Â
Technology and IT
Businesses in technology and IT should reduce Scope 3 emissions by initially focusing on choosing cloud providers or data centres powered by renewable energy. Additionally, implementing energy-efficient data management practices, such as data deduplication and server virtualisation, can reduce energy consumption and make data handling more sustainable.
Extending product life cycles is another impactful strategy. Designing technology products with durability, repairability, and upgradeability in mind reduces the need for frequent replacements, which in turn lowers emissions from manufacturing. Using recycled materials in products also helps reduce the environmental impact associated with sourcing raw materials.
Creating sustainable supply chains for electronic components can further drive emission reductions. Companies should work closely with component suppliers that practice environmentally friendly manufacturing and prioritise suppliers who disclose their emissions and are actively engaged in sustainability initiatives. This transparency fosters accountability and encourages greener practices across the supply chain.
Finally, addressing employee commuting and remote work can contribute to lower emissions. Implementing flexible remote work policies and encouraging carpooling or the use of public transportation helps reduce the carbon footprint associated with employee travel, making a positive impact on overall Scope 3 emissions.
Food and Beverage
To address Scope 3 emissions in the food and beverage industry, companies can implement sustainable agricultural practices. They can do this by sourcing ingredients from farmers who use regenerative agriculture, organic methods, or practices that minimise water and fertiliser use. This approach not only supports sustainable land use but also reduces emissions related to land conversion and agricultural inputs.
Reducing food waste is another crucial strategy. Companies can adopt waste reduction measures throughout the supply chain, from production to retail. By donating surplus food, they can divert waste from landfills, thus reducing methane emissions and supporting food security.
Low-emission packaging alternatives also play an important role in minimising the environmental impact. Utilising recyclable, compostable, or lightweight packaging materials lowers emissions associated with material extraction and waste disposal. Additionally, innovative packaging designs that extend shelf life can help prevent food spoilage, further reducing waste.
Lastly, companies can encourage sustainable dietary choices by promoting plant-based or low-carbon food options. Through product lines and marketing campaigns, they can educate consumers about the environmental benefits of such choices, helping to shift purchasing behaviours towards more sustainable options.
Key takeaways
Reducing Scope 3 emissions is a challenging but essential journey. As organisations across sectors adopt innovative strategies to minimise their indirect emissions, they contribute to strengthening the low-carbon economy. However, achieving progress requires sustained collaboration, investment in green technologies, and a commitment to ongoing education.
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