INVERTO: FTSE 100 Supply Chain Emissions are Rising
Supply chain emissions among FTSE 100 companies surged by 62 million tonnes of CO2 last year, climbing to a staggering total of 3.3 billion tonnes, according to new research by INVERTO, the supply chain consultancy arm of Boston Consulting Group (BCG).
This 3% year-on-year increase raises urgent questions about how effectively these companies are tackling their climate commitments.
The primary culprit is Scope 3 emissions, which account for the carbon output generated throughout supply chains. This includes emissions from raw materials, goods and services used by companies, as well as those created by consumers using their products.
Of the FTSE 100, 86 companies included Scope 3 data in their reports. However, this leaves a significant portion of firms unaccounted for, suggesting the real figures may be even higher.
This growth aligns with a global pattern. BCG’s report, Boosting Your Bottom Line Through Decarbonisation, found that Scope 3 emissions continue to rise worldwide, including in industries where major companies have publicly committed to reductions.
Yet the reality of cutting these emissions is fraught with challenges.
As Kiren Pandya, Principal at INVERTO, explains: “There is not going to be an easy glidepath to net zero. It will need a thorough strategic review of supply chains, careful planning and hard work.”
Among the FTSE 100, 37 companies reported increased supply chain emissions last year, while 32 achieved reductions. Others reported no change or provided insufficient data. These results highlight the uneven progress across the UK’s largest companies.
“These figures clearly demonstrate that despite the commitments made by businesses, there is still a long way to go to achieve net zero for the UK’s largest companies,” Kiren adds.
Signs of change amid mounting challenges
Despite the overall rise in emissions, there are promising signs that more companies are taking their carbon footprints seriously. Last year, the number of FTSE 100 firms reporting on their net zero progress rose from 53 to 68. Those with formal emissions reduction plans also grew from 50 to 78.
“This sharp year-on-year rise shows that a growing proportion of the UK’s biggest companies are becoming more transparent about their carbon emissions—and what they’re intending to do about them in the future,” Kiren remarks.
BCG’s findings reinforce this, showing that companies with robust climate transition plans are more than three times as likely to achieve emissions reductions. However, the concentration of emissions among a few major sectors—oil, gas, mining and engineering—remains a significant barrier. These industries alone account for 92% of total Scope 3 emissions among the FTSE 100.
“What’s really positive is that more and more companies are actively tracking their Scope 3 emissions and now have detailed plans in place to reduce them,” Kiren notes.
Practical steps towards net zero
For companies grappling with the complexity of emissions reduction, INVERTO recommends focusing first on straightforward, achievable measures. This might include sourcing materials locally, addressing supply chain inefficiencies, and decarbonising logistics and transport.
“The bulk of supply chain emissions reductions are relatively easy to realise in the medium term. Businesses should be focusing on the ‘low-hanging fruit’ in their Scope 3 emissions,” Kiren advises.
Meanwhile, advanced technologies are opening up new opportunities. BCG’s research shows companies using artificial intelligence to optimise emissions reduction strategies are 4.5 times more likely to achieve meaningful decarbonisation outcomes.
While the road to net zero is far from straightforward, these practical solutions demonstrate that progress is achievable with careful planning and sustained effort.
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