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20 May 2011 | Lindsay Clark
The UK government’s decision to halve carbon dioxide emissions by 2027 offers procurement managers a strong signal to ensure climate change is on their suppliers’ agenda.
Earlier this week, energy and climate change secretary Chris Huhne announced the government’s fourth carbon budget, which introduces a commitment to reduce carbon emissions by 50 per cent from 1990 levels, before 2027. “We are working up a package of measures to be announced by the end of the year to help energy-intensive industries adjust to the low-carbon industrial transformation while remaining competitive,” he said.
Frances Way, programme director of the Carbon DisclosureProject, said the commitment would help businesses think ahead in managing their suppliers. “But there is still a little bit of uncertainty about what the policies will be to deliver on it. Whether companies will have targets that include their own supply chain or not – we’re not clear on that at the moment,” she said.
However, decarbonising the global economy was “the first predictable industrial revolution” the world had seen, she said.
“We already see a number of leading companies setting expectations for their suppliers to show that they are increasing energy efficiency and thinking about producing low-carbon products. I think in terms of competitiveness for suppliers, the market is already signalling that it is moving in that direction ahead of regulation.”
Earlier this week, sportswear manufacturer Puma published its first Environmental Profit and Loss Account, including an analysis of water consumption and greenhouse gas emissions in its supply chain. The firm calculated that the environmental impact of its own operations translates to the equivalent of €7.2 million (£6.33 million) while an additional €87.2 million (£76.70 million) falls upon four tiers of its supply chain.
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