Supply Chain Sustainability: What It Takes to Reduce Emissions

In an era where climate change has swiftly transitioned from a distant concern to an urgent mission, the dialogue on sustainability has immensely transformed. Today, sustainability is not just a corporate buzzword; it's a foundational element driving businesses toward a better, greener future. The heart of this transformation lies within our supply chains, where a staggering share of global greenhouse gas (GHG) emissions are rooted, primarily through transportation. The urgent call is not just about acknowledging the looming threat but about developing a strategic and tactical response that aligns with the Paris Agreement and the Science-Based Targets initiative (SBTi).

Based on our recent 2024 State of Transportation report, a significant majority of shippers (98%) have set sustainability goals for transportation, with nearly two-thirds (63%) aiming to achieve specific sustainability certifications or standards like the SBTi. To meet the goals of the Paris Agreement – limiting global warming to 1.5°C above pre-industrial levels – SBT must cover scopes 1 and 2 and scope 3 if the scope represents more than 40% of their combined scope 1, 2, and 3 emissions. In this situation, the targets must seek to reduce at least 2/3 of scope 3 emissions. This trend illustrates a broader shift in how businesses view sustainability – from a mere buzzword to an essential element of their operations.

The Critical Context of GHG Emissions in Supply Chain Sustainability

But setting goals and achieving them are two distinct challenges. To effectively reduce emissions, organizations must adopt a multi-faceted approach, implementing solutions that address the root causes while also working towards long-term sustainable practices.

The 2024 State of Transportation Report unveils a crucial narrative. Shippers are mobilizing comprehensive strategies to curtail emissions. Half of shippers (50%) are taking action in 2024 by evaluating the potential emissions impact of alternative energy sources, the No. 1 tactic. More than 40% are also looking to optimize routes to minimize distance traveled and assess the cost and availability of transitioning select lanes to alternative energy modes. The statistics are clear, shippers are looking to make strides on their emissions reduction targets.

Carriers are making sustainable progress as well. Their top three actions in 2024 include integrating fuel-efficient technologies in their vehicles, performing regular maintenance for optimal performance, and introducing electric or hybrid vehicles into their fleet. Carriers understand that reducing emissions benefits the environment and boosts their bottom line as shippers seek more efficient carriers - a win-win scenario.

With shippers and carriers working together towards a sustainable supply chain, this partnership can create lasting positive change in the industry.

Establish a Precise Emissions Baseline for Effective Reduction Strategies

Before embarking on efforts to reduce emissions, it is crucial to first establish a precise emissions baseline. This baseline serves as a reference point to monitor your supply chain sustainability progress annually, reflecting on the impact of operational decisions. For instance, during the year you may have transitioned some shipments to rail, leading to an emissions reduction of 50% to 70%. However, the introduction of more flatbed shipments, known for their lower fuel efficiency, offset these gains by increasing emissions. By leveraging detailed network data at the lane level, shippers can pinpoint the main contributors to emissions within their network over time, gaining valuable insights into their emission trends and discovering opportunities to reduce emissions.

Steps to Establish a Precise Transportation Emissions Baseline

Establishing a precise emissions baseline is a crucial initial step for any organization looking to effectively reduce its carbon footprint. The steps outlined below serve as a guide to reach this fundamental milestone in supply chain sustainability:

1. Critically examine your transportation network to determine what should be included in your emissions calculation
2. Assess available data sources and underlying data quality to explore viable calculation options
3. Decide on an approach to calculate emissions, considering available data
4. Research the necessary inputs for your emissions calculation based on the specified baseline year and chosen framework, such as the Global Logistics Emissions Council framework
5. Collect the required data elements based on the chosen emissions calculation method
6. Calculate emissions based on the framework chosen, available inputs, and actual load data
7. Repeat steps 3, 4, and 5 annually or according to your preferred operating cadence

When determining your emissions baseline, consider partnering with an experienced and trusted transportation emissions management provider. These experts bring industry knowledge, innovative solutions, and experience to simplify emissions calculation, reduction, and reporting. This collaboration not only saves time and resources but also ensures precision and compliance with current and anticipated sustainability standards and regulations.

Supply Chain Sustainability is a Continuum

Your supply chain sustainability journey isn't a project, it's a process. The transportation sector is continuously evolving, with advancements in technology and alternative energy sources presenting new opportunities for reducing greenhouse gas emissions. Organizations should establish a baseline and actively track their progress toward achieving sustainability goals to adjust strategies as the landscape evolves.

Take the first decisive step towards a greener, more sustainable future with CleanMile. Our emissions management solution is designed to empower your business with the tools needed to accurately calculate a precise emissions baseline, strategize a clear emissions reduction roadmap, and monitor your progress year over year. Don't let the complexity of sustainability reporting hold you back. Contact us for an introductory meeting, and see how we can transform your supply chain sustainability efforts into measurable success. Together, we can drive impactful environmental change.