- Investor Watch -
Significant rise in major purchasers seeking sustainability data from suppliers
Published June 4, 2020
Environmental non-profit CDP has announced a 24% jump in the number of companies asking their suppliers to report environmental data this year.
The number of large purchasing organizations asking their suppliers to report environmental data has risen by 30 since 2019 to more than 150. The submission date for companies to make their CDP disclosure has been extended to 26 August 2020 due to the COVID-19 pandemic.
The member organisations have a combined purchasing spend of more than US$4 trillion. The members will be calling on 15,000 suppliers to report on a range of environmental issues. It is estimated that emissions in the supply chain are 5.5 times higher than a company’s direct emissions.
Key suppliers will be required to report via the CDP’s platform on their impacts, risks, opportunities and strategies related to climate change, deforestation and/or water security issues. This data will be used to inform procurement decisions and supplier engagement strategies.
The list was boosted by six UK purchasing organisations including CBRE, Sainsbury’s, HSBC and GSMA (the international mobile networks trade association). From the EU, 10 joiners include Airbus, Ørsted and Bayer. The US saw the largest jump in new members, with 17 new joiners including Nike, Microsoft, Walmart, Prudential, Nordstrom and the New York MTA.
The demand for this data among the procurement teams of these large buyers is driven by growing awareness of the environmental risks posed to business – including physical impacts disrupting global supply chains and reputational risks to brands because of environmental damage in the supply chain.
Rasmus Skov, head of sustainability at Ørsted, said: “Businesses will need to collaborate across supply chains to cut emissions at the pace and scale demanded by science. At Ørsted, we encourage our top suppliers in the renewable energy industry to make carbon reductions a part of their business strategy. This is key to staying competitive and accelerating the global transformation to green energy. With the help of CDP, we’re asking suppliers to disclose their own emissions and set science-based carbon reduction targets.”
Full list of CDP supply chain members: cdp.net/en/supply-chain
