Center for Corporate Climate Leadership How to Engage Suppliers
Strategically Choose Which Suppliers to Engage
Organizations are choosing to engage a small number of key suppliers that comprise 75 to 80 percent of spend as well as those that pose the greatest risk to financial performance or brand reputation if their emissions are not quantified and managed. The latter may include smaller suppliers that provide critical components or represent other risk factors, such as energy-intensive operations that are vulnerable to rising costs from energy price increases.
Keep the Questions Simple
Organizations often use GHG emissions questionnaires or databases to collect information from key suppliers. Organizations that have conducted their own GHG inventories emphasize the need to keep the information requests simple and not ask questions that they themselves would have difficulty answering. Some organizations ask suppliers for quantitative data, while others focus first on qualitative questions such as whether the suppliers are measuring, reporting, or taking steps to reduce emissions. In some cases, organizations use supplier GHG emissions information as a proxy to understand how their suppliers are approaching sustainability more broadly.
Build Trust with Suppliers
Suppliers may be sensitive about how their information will be used, with some fearing that sharing their GHG inventory data will provide insight into how their operations are managed and the potential link to production costs. Similarly, suppliers may worry that their customers could leverage the information to request further cost reductions, rather than grant them the flexibility to manage any operational cost savings identified as a result of developing their GHG inventory.
To build trust, organizations may want to consider initiating engagement with suppliers by sharing their success stories on how measuring GHG emissions saved money or enhanced competitiveness, as well as lessons learned, tools, and other resources that resulted in realized and potential benefits. This may help suppliers avoid being skeptical of measuring and reporting their GHG emissions to the requesting organization. Organizations may also want to consider collecting data through third-party programs that protect suppliers' confidential business information.
Provide Training and Capacity Building
At first, suppliers may not know how to measure and report their GHG emissions and fear it could be resource intensive. However, when developing a GHG emissions inventory for the first time, suppliers often find that gathering the utility bills and other necessary information is more time-consuming than difficult.
Training and capacity building for suppliers are critical components of a customer-supplier relationship that have the goal of managing GHG emissions. Many organizations have supplier focused meetings or forums that can be leveraged to include trainings on managing emissions. If resources permit, companies can also create a standing team to provide technical assistance to suppliers through a “Help Desk”.
Conduct Pilot Initiatives
Some organizations select only a subset of suppliers and ask them for GHG emissions information. Organizations have reported needing approximately three years to glean lessons learned from piloting supplier initiatives before having the results and information needed to begin scaling up and solidifying supplier programs within their organizations.