EFT Energy Consultants, a company that helps businesses make savings on their energy consumption, is encouraging businesses to investigate their supply chain when it comes to implementing energy efficiency practices ahead of a new ranking system due to be introduced next year.
Each step in the supply chain carries its own load of greenhouse gas emissions and as a result, increases the carbon footprint of a company. This is particularly true for manufacturing companies, which are more likely to have a host of suppliers bringing in goods to be used to make products, sometimes from various locations across the globe.
As of next year, CDP, the UK-based organisation that works with shareholders and corporations to disclose the greenhouse gas emissions of major corporations, will begin ranking companies based on how well they work with their suppliers on climate-related threats. According to the CDP, with supply chains responsible for up to four times the green house gas emissions of a company's direct operations, they represent a key focus area for businesses preparing for a low carbon future.
In light of this, EFT Energy Consultants suggests businesses need to engage with suppliers in a bid to lower energy use. Such efforts can consequently reduce inefficiencies in organisations' supply chains and limit unnecessary costs across the board.
Although numerous businesses have taken the initiative to improve energy efficiency and reduce carbon outputs, most keep their focus inward. This can be through upgrading offices with energy efficient appliances and implementing technology designed to keep electricity use at a minimum. However, few companies are investigating their supply chain emissions, where carbon outputs are often significantly higher.
Chris Jenkins, director of EFT Energy Consultants, said:
"Organisations not only need to take account of the energy expenditure of the business itself, but also that of its supply chain. This is not just about trying to be seen as a socially responsible business in the eyes of the consumer. We need to encourage companies to look at energy savings as a strategic business advantage. Through advocating this view, organisations are more likely to step up to the mark when it comes to the energy efficiency of the business overall, including its supply chain.
"With the CDP looking to rank companies based on how well they work with their suppliers on climate-related risks from next year, this is something that simply should not be ignored."