Responsible purchasing: integrating carbon footprints into supplier qualification

Complying with standards while meeting market expectations: a strategic imperative

⚖️Conformité legal: introduction of the CSRD (Corporate Sustainability Reporting Directive), the Green Pact for Europe, and international regulations

The introduction of new regulations is making sustainability an essential criterion in every purchasing decision made by organizations. Directives such as the Corporate Sustainability Reporting Directive (CSRD) require companies to provide detailed sustainability reports, enabling transparency on their environmental performance.

In addition, the Green Pact for Europe aims to make the EU economy sustainable by reducing greenhouse gas (GHG) emissions and promoting greener practices. These regulations encourage companies to assess and reduce GHG emissions in all their operations. At the same time, these standards help to make organizations more accountable along their entire value chain.

Thus, integrating emissions reduction into supplier qualification helps to prepare for legal requirements and remain compliant.

📈Competitive advantages: Organizations aligned with sustainability goals enhance their attractiveness to investors and customers.

Reducing the emissions associated with purchasing also helps to make companies more attractive to investors, who are increasingly sensitive to environmental, social and governance (ESG) issues.
According to the ESG 2023 survey conducted by BNP Paribas: "76% of investors believe that climate change and decarbonization are important enough to influence their investment strategy.

In this way, organizations meet market expectations while actively contributing to the move towards a sustainable development model.

Decarbonizing the value chain for a more sustainable future

🔎Controlling Scope 3 emissions

Scope 3 emissions, which include those generated by suppliers, often represent a significant proportion of a company's carbon footprint. These indirect emissions must now be taken into account in a company's GHG balance sheet.

For sectors such as fashion or automotive, these indirect emissions can account for over 70% of their total footprint, according to Deloitte.

By taking CO₂e impact into account when qualifying their suppliers, companies can reduce their environmental footprint and meet the sustainability commitments set by agreements such as the Paris Agreement.

🤝Responsible collaborations: a commitment to reducing emissions while enhancing resilience in the face of climate risks.

A mutual commitment to a responsible value chain fosters transparent trade and strengthens the loyalty of business partners. What's more, some partners also invest in actions to reduce their own ecological footprint, thus actively participating in the collective effort to mitigate the effects of climate change.

This generates a positive synergy, where each player in the partner network contributes to sustainable development, strengthening the competitiveness of organizations and their brand image.

"54% ofinvestors plan to use impact investing or social impact investing," according to the ESG 2023 study conducted by BNP Paribas."

📉 Cost optimization through responsible purchasing and ESG commitment

Integrating ESG criteria into responsible purchasing also helps to reduce costs while minimizing the impact on the ecosystem. More energy- and resource-efficient practices on the part of your partners also contribute to lower production costs. The return on investment from this commitment is threefold, combining growth, profitability and sustainability.

Indeed, organizations that commit to an ESG approach see their performance improve.

➡️Le triple bottom line

When an organization achieves simultaneous progress in three key areas, it achieves what is known as "triple growth": increased sales, solid economic benefits and concrete progress in ESG criteria. This model of sustainable growth delivers exceptional returns, creating a foundation on which business and environmental strategies can build long-term success.

"Companies with triple outperformance fared much better, however, with more than half recording growth of 10% or more."

"Triple performers grew revenues at a median rate of 11% per annum, 1.4 percentage points higher than the average achieved by profitable high-growth companies that lagged behind on ESG criteria."

source:McKinsey

➡️Bénéfices economic

→ energy savings

An intelligent approach to data management and artificial intelligence could reduce their GHG emissions by 5-10%, generating multi-billion dollar savings by 2030 through improvements in energy efficiency and sustainable production, according toBCG.

→ production cost savings

What's more, "effective ESG implementation can help combat rising operating expenses (such as the cost of raw materials, the real cost of water...), which, according to a McKinsey study, can affect operating profits by up to 60%."

➡️Durabilité

To ensure sustainable, long-term performance, it is essential to structure a strategy that encompasses growth, profitability and ESG principles, while innovating with responsible offerings to maximize value creation. An integrated approach to corporate CSR must include the adoption of a responsible purchasing policy. By defining rigorous purchasing standards aligned with its sustainability ambitions, the company can collaborate with partners sharing the same ESG commitments.

By promoting ethical practices throughout the supply cycle, this policy contributes to reducing the impact on the ecosystem and to the resilience of the organization. Furthermore, by drawing up regular reports such as carbon footprints, or ESG reports, whether annual or half-yearly, companies can transparently monitor the evolution of their concrete actions and CSR indicators, and adjust their strategies in line with market trends and growing customer expectations.

This proactive approach optimizes the company's core strategy, increases stakeholder commitment and strengthens its long-term sustainable competitiveness.

Measuring tools to monitor and control GHG emissions

➡️Bilan of GHG

The Greenhouse Gas (GHG) Emissions Balance Sheet analyzes an organization's direct and indirect emissions (Scope 1, 2 and 3), providing a complete picture of its environmental profile.

By integrating this assessment into the evaluation of partners, organizations can identify the most effective players in reducing GHGs, and pinpoint levers for improvement throughout the supply chain.

➡️Product Carbon Footprint

Once a company's GHG emissions have been assessed, the Product Carbon Footprint (PCF) can be used to quantify the emissions specific to each product or service.

The PCF is a detailed assessment of the emissions associated with each product, taking into account its entire life cycle: from extraction of raw materials to final delivery.

This granular approach is particularly valuable in sectors with high optimization margins, contributing to more sustainable overall performance.

The importance of qualifying partners in terms of ESG commitment

📈Carbon evaluation grids

To facilitate the choice of partners committed to reducing emissions, companies can set up evaluation grids incorporating carbon scores.

These grids enable suppliers to be compared on a standardized basis, taking into account their CO₂e and GHG emissions, their resource management practices, and their efforts to reduce them.

This rating system helps to structure decision-making by providing transparency on the ESG commitments of each supplier, and encourages the selection of partners aligned with the company's emissions reduction objectives.

✅Certifications and labels

Environmental certifications and labels, such as ISO 14001 or the low-carbon label, are other valuable tools for assessing partners' GHG emissions.

By adding these certifications to the qualification criteria, organizations ensure that their suppliers meet recognized environmental standards. This process ensures greater compliance with regulatory requirements, and demonstrates the partners' serious commitment to sustainable development.

Decarbo'Supply® enables organizations to assess and quantify the emissions linked to their purchases, thus facilitating informed decision-making regarding the selection of their partners. By offering an intuitive and accessible platform, this solution helps organizations identify responsible approaches and establish ethical purchasing standards.

The main benefits of Decarbo'Supply® include :

• Emissions assessment: Thanks to high-performance analysis tools, organizations can measure the carbon weight of their suppliers' products and services.
• Cost optimization: By integrating a responsible approach into the purchasing process, organizations can not only reduce their consumption of resources, but also achieve significant savings.
• Enhanced competitiveness: By adopting ESG criteria in their purchasing decisions, organizations position themselves as responsible and committed players, reinforcing their brand image and attractiveness to customers and investors.
• Tracking and reporting: Decarbo'Supply® offers reporting functions to track the progress of social responsibility actions, guaranteeing greater transparency and accountability within the organization.

By joining Decarbo'Supply®, organizations commit to a proactive approach that prepares them to meet tomorrow's challenges, while contributing to a more environmentally-friendly future.