Decarbonising Supply Chains: Insights from ENGIE Impact

Joseph Sarvary, Manager of Sustainability Solutions for EMEA at Engie Impact, is a seasoned expert in decarbonisation strategies tailored for the globe’s largest corporations and their supply chains.

With a sharp focus on reducing Scope 3 emissions, he collaborates with industry leaders to tackle upstream and downstream environmental impacts, including procurement operations.

Joseph’s approach is both innovative and hands-on, offering expertise in supplier data management, designing immersive supplier engagement programmes and pioneering cutting-edge financial mechanisms.

His work includes implementing carbon insetting techniques like book-and-claim frameworks, bringing creativity and precision to the challenge of sustainable transformation across complex global networks.

Here, Joseph discusses the importance of sustainability when selecting suppliers and how to balance this effectively amidst rising costs. 

For those unfamiliar with ENGIE Impact, please give us a brief overview

ENGIE Impact is a global leader in sustainability consulting, empowering organisations to accelerate their journey to net-zero through a comprehensive suite of solutions.

At its core, ENGIE Impact specialises in strategy consulting for the development of decarbonisation roadmaps tailored to each client’s unique challenges and opportunities. These roadmaps serve as actionable blueprints, enabling organisations to align operational goals with ambitious science-based carbon reduction targets.

ENGIE Impact further distinguishes itself by driving large-scale project implementation, transforming decarbonisation strategies into tangible outcomes. Leveraging expertise in renewable energy, energy efficiency and sustainable infrastructure, ENGIE Impact supports the implementation of decarbonised assets at scale, from renewable energy installations to advanced low-carbon technologies.

Through our “Decarbonisation as a Service” (DaaS) business model, ENGIE Impact eliminates barriers to implementation, providing end-to-end support that integrates financial, technical and operational solutions. This approach ensures projects are not only feasible but also economically viable and impactful.

A critical aspect of ENGIE Impact’s value proposition lies in its ability to cascade decarbonisation intelligence throughout the value chain.

By leveraging digital platforms like the Ellipse Zero Carbon Platform and custom data analytics, ENGIE Impact helps organisations engage suppliers, identify emissions hotspots and foster collaboration across their ecosystems. This approach ensures that sustainability efforts extend beyond direct operations to encompass entire supply chains, creating resilient, sustainable networks equipped to meet the demands of a low-carbon future​.

To what extent is sustainability influencing supplier decisions?

Sustainability is increasingly shaping supplier decisions, driven by mounting pressure from consumers, regulators and stakeholders.

At ENGIE Impact, we see this first-hand as companies like Microsoft and Bayer actively integrate Science- Based Targets (SBTs) into their procurement strategies, requiring suppliers to demonstrate a commitment to emissions reductions and offering support and training to accelerate the transition.

This shift reflects a growing recognition that sustainable supply chains are essential for long-term resilience and compliance.

It’s important to acknowledge that the pace of adoption varies. Research shows that while 36% of B2B buyers are willing to drop suppliers who don't meet sustainability standards, competing factors such as cost pressures and geopolitical challenges are barriers to accelerating progress.

To stay on track with global net zero, many organisations are turning to innovative tools and strategies.

Advanced data systems, distributed contracting structures and renewed procurement guideline documents allow businesses to gain deeper visibility into their supply chains, build relationships and ensure alignment with both cost and sustainability goals. With more data, firms can more quickly identify high-emission suppliers and collaborate on decarbonisation efforts effectively​.

At ENGIE Impact, we believe that embedding sustainability into procurement is not only possible but necessary. By prioritising resilient, transparent supply chains and leveraging cutting-edge data solutions, companies can balance environmental goals with operational and financial performance.

While the journey isn’t without its challenges, the benefits—ranging from enhanced brand reputation to regulatory compliance and market differentiation—make it a critical focus for any forward-thinking organisation.

How can businesses balance cost, quality and environmental sustainability when selecting suppliers?

Balancing cost, quality and environmental sustainability in supplier selection is both a challenge and an opportunity. Businesses that successfully integrate these priorities can build stronger relationships with their suppliers, fostering greater trust and collaboration while creating more resilient supply chains.

Resilience is increasingly critical as companies navigate growing environmental and regulatory pressures. Strengthening partnerships enables businesses to work hand-in-hand with suppliers to address shared challenges, such as decarbonisation, while maintaining the quality and cost-effectiveness customers demand​.

At ENGIE Impact, we emphasise a data-driven supplier-centric approach to achieving this balance. This allows businesses to pinpoint opportunities for targeted interventions while engaging high-emission suppliers in tailored decarbonisation initiatives.

Financial mechanisms are also a powerful enabler, helping organisations directly invest in supplier decarbonisation projects while reaping the benefits of carbon reductions.

By embedding sustainability into the economic model, companies can meet ambitious environmental goals without excessive cost burdens, creating mutual value​ for themselves, their suppliers and their customers.

What challenges might organisations face when working with suppliers to meet decarbonisation targets?

Key challenges include:

Data transparency: One of the most significant hurdles is the lack of robust and consistent emissions data from suppliers, particularly for Scope 3 emissions. Many suppliers, especially in fragmented or less technologically advanced industries, do not have systems in place to track and report their carbon footprint accurately.

Without this visibility, it becomes challenging for organisations to identify hotspots and drive meaningful reductions. Improving traceability and data transparency across supply chains is essential for achieving sustainability goals, as it forms the foundation for accountability and actionable insights​.

Resource disparities: Smaller suppliers often struggle to meet decarbonisation targets due to limited financial resources, technical expertise, or access to geographically limited sustainable technologies. These disparities can create bottlenecks, especially in industries reliant on smaller, localised suppliers.

Collaboration gaps: Aligning diverse suppliers across geographies and industries presents another layer of complexity. Suppliers often operate under different regulatory frameworks, cultural expectations and levels of sustainability awareness.

The lack of alignment can slow progress, as achieving consistency in sustainability practices requires significant coordination. Fostering collaboration and shared accountability within supply chains is critical to overcoming these challenges, with digital tools playing a central role in bridging these gaps​.

These challenges, while substantial, are not insurmountable. Through focused collaboration, clear communication and the deployment of targeted tools and resources, organisations can overcome these barriers and make significant progress toward their decarbonisation goals.

ENGIE Impact is committed to partnering with businesses and their suppliers to facilitate this transformation, ensuring that sustainability is not just a goal but a shared journey.

How can firms measure the effectiveness of their supplier decarbonisation strategies?

Effectiveness can be measured through baseline assessments and continuous monitoring of improvements. Establishing a clear baseline of supplier emissions helps identify high-impact areas and sets measurable benchmarks that can be tracked over time.

Continuous monitoring through advanced analytics and traceability tools allows companies to visualise progress in real time, ensuring that efforts align with decarbonisation goals and reveal areas for improvement.

Additionally, regular reporting and external validation ensure that reductions are credible. Transparent reporting practices, aligned with global standards, combined with audits or certifications, validate that supplier commitments lead to tangible emissions reductions. Together, these approaches provide a clear view of impact and ensure accountability across the supply chain.

How can decarbonisation goals be integrated into supplier agreements and contracts?

To effectively integrate decarbonisation goals into supplier agreements, three key strategies should be employed:

Set Clear and Measurable Targets: Incorporate specific emissions reduction targets or sustainability commitment requirements into contracts. This ensures that sustainability is embedded in the agreement and suppliers are held accountable for meeting these targets​.

Include Monitoring and Reporting Provisions: Establish requirements for regular monitoring and reporting of emission intensity, along with third-party verification. This guarantees transparency and helps track supplier performance against agreed targets​.

Incorporate Financial Incentives or Penalties: Align financial incentives or penalties with performance, encouraging suppliers to invest in decarbonisation efforts. This creates a mutually beneficial relationship, motivating suppliers to meet their sustainability obligations​.

By applying these strategies, organisations can ensure that decarbonisation becomes an integral part of supplier relationships, driving measurable climate action across the supply chain.

What steps can be taken to support smaller suppliers who might lack the resources to effectively decarbonise?

Supporting smaller suppliers can be done by:

1. Providing financial aid: Within value chain mitigation actions allow buyers to fund decarbonisation projects within their supply chain, directly addressing financial barriers.

2. Capacity building: ENGIE Impact has worked with large corporate companies to develop customised training programmes to equip small scale suppliers with the knowledge and skills necessary for the sustainability transition.

3. Collaborative models: Creating and engaging in peer networks and buyer alliances to share resources and technologies ensures even small suppliers can achieve ambitious sustainability goals. By prioritising inclusivity in decarbonisation, companies not only meet climate targets but also foster equitable and resilient value chains.

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