Transforming supply chains for a Net Zero future

With Scope 3 emissions constituting over 80% of total corporate emissions in many industries, addressing them is critical for businesses striving toward net-zero targets. In a recent webinar, leaders from CDP, The Economist, and CO2 AI discussed actionable strategies and shared data-driven insights on tackling this pressing issue.

Why Scope 3 emissions matter

Scope 3 emissions, which encompass upstream and downstream activities, are significantly higher than operational (Scope 1 and 2) emissions and create a domino effect of environmental impacts on a large scale. According to data shared by CDP, Scope 3 emissions are, on average, 26 times higher than a company’s direct operational emissions. Yet, only 15% of companies currently have set upstream Scope 3 targets leaving huge blind spots when it comes to understanding their impact on the environment.

“Engaging suppliers to measure, manage and reduce their emissions is critical. Companies working collaboratively with their supply chains are 6.6 times more likely to have a climate transition plan aligned with the 1.5°C trajectory,” explained Veronica Celedon, a Supply Chain Account Manager at CDP.

Veronica also emphasized that regulations such as the Corporate Sustainability Reporting Directive (CSRD) in Europe are intensifying the focus on supply chain emissions, making them a priority for businesses across industries.

A strategic framework for supplier engagement

The panel outlined a five-step framework for effective supplier engagement:

• Segment suppliers using data: Annual data collection helps identify suppliers with the most significant carbon footprints. This data should drive supplier segmentation based on maturity and emissions.
• Encourage tier-one supplier action: Focus on suppliers which are the largest emitters in your supply chain. Support them in setting reduction targets to have the maximum impact on Scope 3 reduction.
• Set targets and leverage advanced initiatives: Set targets with your suppliers and push for renewable energy adoption and other impactful measures with mature suppliers.
• Collaborate on shared solutions: Build partnerships for joint initiatives to reduce emissions intensity and push key-suppliers to collect product-level data.
• Track progress in a centralized platform: Consolidate and report the data from your suppliers across the supply chain for transparency and monitoring.

According to our expert in-house calculations, by implementing this approach, companies can achieve a 15-20% reduction in overall emissions.

Data-driven insights with AI

In a previous CO2 AI article, we demonstrated how AI plays a transformative role in addressing Scope 3 emissions. The topic was once again a central theme of discussion at the webinar. Geoffroy explained

CO2 AI’s tools help businesses build granular carbon footprints, which enables better prioritization of suppliers and actionable reductions. It’s not just about measuring emissions; it’s about using that data to drive change.

Our tool analyzes millions of lines of corporate activity data to match individual Emission Factors (EF), from a world-leading database of over 110,000 factors. Using a refined version of Retrieval-Augmented Generation (RAG) that leverages vectorial searches through multiple embedding models, CO2 AI can find and match emissions data with unprecedented speed and accuracy, unlocking new opportunities for large organizations.

The Economist’s digital transformation

A standout example of innovation came from Emily, who shared The Economist’s shift to a digital-first model. The digital transformation of The Economist Group’s business—particularly in its core product offering, which in four years has undergone a profound shift from print to digital—has driven a 30% reduction in its carbon footprint since 2020, surpassing its 2025 goal.

“Now, 65% of our subscribers are accessing digital-only content, and we’re on track to achieve a 43% reduction in emissions by 2030, in line with our science-based target. This transition has allowed us to reach more audiences with less environmental impact,” Explained.

The organization’s greenhouse gas inventory revealed that 98% of its emissions come from Scope 3 activities, predominantly in areas like paper manufacturing, printing, and logistics. By targeting these hotspots, The Economist has driven meaningful reductions.

The Importance of data accuracy and collaboration

The speakers addressed the complexities of collecting primary data. Fragmented data and manual processes are a hindrance to progress on achieving sustainability goals. Often, too much time is spent on data collection and calculation and not enough on action. Emily highlighted a critical challenge:

Veronica from CDP shared that suppliers using CDP’s platform have demonstrated measurable improvements. First-time responders often report intensity targets, while repeat responders show significant growth in setting science-based targets.Moreover, engagement from CDP’s Supply Chain Members drove 43 million tonnes of emission reduction initiatives in 2023 alone.

Companies disclosing via CDP reduced emissions by 7-10% within two years of reporting. Collaborative engagement between procurement teams and suppliers also emerged as a critical enabler. By aligning on clear goals, organizations can foster trust and accelerate progress.

Turning challenges into opportunities

The webinar concluded with a powerful message: addressing Scope 3 emissions isn’t just about compliance—it’s about driving value, reducing costs and maximising investment.

“Data is the foundation of impactful sustainability strategies. By engaging suppliers, leveraging technology, and committing to transparency, businesses can turn Scope 3 challenges into opportunities for growth and innovation,” said Geoffroy.

To help large corporations address the issue of gathering primary data, CDP and CO2 AI joined forces in 2024 to build the leading product-level data sharing platform: Product Ecosystem.

Product Ecosystem leverages CDP’s network, with over 66% of the world’s market capitalization reporting through CDP in 2023, and CO2 AI's carbon accounting computation expertise. It enables any CDP Supply Chain program member or CO2 AI customer to request, or provide, product-level data from stakeholders (mainly suppliers and customers) in their value chain.

The Economist Group began onboarding its top 50 suppliers on Product Ecosystem last year, aiming to improve the accuracy of its carbon footprint using primary data, as well as actively engage in decarbonization initiatives with key supply chain partners. Having a centralized tool that offers them their carbon footprint in real time, along with granular level data across their supply chain, has helped the organization remain on track to achieve 42% reduction by 2030.