(C12.1a) Provide details of your climate-related supplier engagement strategy.
Question dependencies
This question only appears if you select “Yes, our suppliers” in response to C12.1.
Change from last year
Modified question
Rationale
Answers to this question provide investors and data users with more transparency regarding companies' supplier engagement processes. As the majority of most companies’ emissions occur outside their direct operations, data users are interested in understanding how organizations are working with their suppliers to drive best practice and ameliorate climate-related issues.
Connection to other frameworks
SDG
Goal 12: Responsible consumption and production
RE100
Response options
Please complete the following table. You are able to add rows by using the “Add Row” button at the bottom of the table.
Type of engagement | Details of engagement | % of suppliers by number | % total procurement spend (direct and indirect) | % of supplier-related Scope 3 emissions as reported in C6.5 | Rationale for the coverage of your engagement | Impact of engagement, including measures of success | Comment |
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Select from:
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Select all that apply: Information collection (understanding supplier behavior)
Engagement & incentivization (changing supplier behavior)
Innovation & collaboration (changing markets)
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Percentage field [enter a percentage from 0-100 using a maximum of 2 decimal places] |
Percentage field [enter a percentage from 0-100 using a maximum of 2 decimal places] |
Percentage field [enter a percentage from 0-100 using a maximum of 2 decimal places] |
Text field [maximum 2,400 characters] |
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[Add Row]
Requested content
General
- If you select “Other, please specify,” provide a label for the “Type of engagement” or “Details of engagement.”
Type of engagement (column 1)
- Select the type of engagement activity your organization participates in from the drop-down.
- Information collection (understanding supplier behavior) - Select this option if the purpose of your engagement with suppliers is to gather data outside of specific initiatives.
- Engagement & incentivization (changing supplier behavior) - Choose this option if you offer specific incentives for your suppliers or engage with them to meet climate-related goals or strategies. Incentives can be recognition (i.e. award schemes or special acknowledgements) or financial. Engagement can be training, support, or collaboration with suppliers.
- Innovation & collaboration (changing markets) - Select this option if you specifically encourage your suppliers to develop new ways to reduce climate change impacts of the products/services that they offer. This can include formal campaigns and calls for partnerships as well as informal collaboration opportunities.
Details of engagement (column 2)
- Expand on the engagement activity (selected in column 1) your organization participates in by selecting all the relevant engagement methods from the drop-down options.
- Your selection in column 1 determines which options you will see here. E.g. If you select “Innovation & collaboration (changing markets)”, you will only see the associated drop-down options here.
% of suppliers by number (column 3)
- Present as a percentage the number of suppliers within your value chain that you engage with on climate-related issues.
% total procurement spend (column 4)
- Include the percentage of total procurement spend (for the reporting year) that the group of suppliers participating in the engagement activity detailed in this row represent. Note that total (direct and indirect) procurement spend includes all operational expenses on raw materials, goods, and services procured.
- Do not include new or potential suppliers for whom you do not have spend data.
% of supplier-related Scope 3 emissions as reported in C6.5 (column 5)
- Only include the percentage of supplier-related Scope 3 emissions reported in C6.5 that are attributable to suppliers participating in the activity selected in this row.
Rationale for coverage of your engagement (column 6)
- Explain how and why this group of suppliers was chosen for the engagement selected in column 1 (e.g. proportion of spend, geographic location, etc.). The description should be company-specific and include details on what the engagement activity entails.
Impact of engagement, including measures of success (column 7)
- Use this column to discuss the impact of this engagement and how you measure its success.
- Include a threshold at which you consider your impact to be successful with regard to the measure of success. For example, if you selected “Offer financial incentives for suppliers who increase the share of renewable energy in their total energy mix” in column 2, the measure of success could be an increase in the share of renewable energy in the engaged suppliers’ total energy mix of 5% per year.
- Please provide examples of positive outcomes achieved. For example, this could include supplier GHG emissions reductions and/or improved climate change strategies including target setting.
Comment (column 8) (optional)
- Use this column to provide any additional explanation that is relevant to capture the full complexity of the emissions changes, using no more than 2400 characters.
Example response
See table below:
Type of engagment | Details of engagement | % of suppliers by number | % total procurement spend (direct and indirect) | % of supplier-related Scope 3 emissions as reported in C6.5 | Rationale for the coverage of your engagement | Impact of engagement, including measures of success | Comment |
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Engagement & incentivization (changing supplier behavior) | Run an engagement campaign to educate suppliers about climate change | 0.6 | 27.4 | 42 | Our supplier engagement strategy is based around the Scope 3 component of our SBTi-approved science-based target, which committed to working with our suppliers (representing 70% of its supply chain emissions) so that they set their own science-based reduction targets and report annual emissions by 2025. The coverage of this target prioritizes Company A’s engagement not on a vaguely defined list of “key suppliers” but rather on the absolute emissions of all suppliers, which will maximize the science-based target’s impact. The target’s requirement of suppliers to report emission reduction progress will not only encourage progress on GHG emissions management but also allow measurement of absolute emissions reductions. At this point this coverage is only of legacy Company A suppliers as we continue to integrate Subsidiary X’s supply chain into all of our goals and targets. | Company A’s science-based target was recently approved by SBTi. As we move toward our target, the impact of engagement will include supplier GHG emissions reductions and/or improved climate change strategies including target setting. Based on an estimated average absolute emissions reduction of 15% per supplier involved in achieving the goal, we anticipate the absolute emissions impact will be 100,000 tCO2e per year (a 10.5% reduction in Company A’s total scope 3 emissions). Success will be measured by percent of suppliers engaged, with a target to have 70% of supply chain emissions set their own science-based reduction targets and report annual emissions by 2025. In 2019, we measured the success of this strategy versus our targets for the first time as we have engaged suppliers representing 33% of Company A’s legacy supply chain emissions through the CDP Supply Chain platform. Of this, suppliers representing 26% of Company A’s legacy supply chain emissions have an approved, committed to or plan to set an SBT. | Our engagement of suppliers for our approved science-based target will primarily be through CDP Supply Chain and in the future, we will strive to report on legacy Subsidiary X’s supply chain emissions progress. |