How Consumer Goods Manufacturers Are Tackling Scope 3

Twenty-six industry leaders, including PepsiCo, Unilever and Ahold Delhaize, have joined forces under the Consumer Goods Forum’s (CGF) Towards Net Zero Coalition to combat the persistent challenge of Scope 3 emissions.

Announced during COP29, this initiative reflects the sector's commitment to addressing the environmental impact of global supply chains.

The focus on Scope 3 emissions arises from their significance across industries. These indirect emissions, originating throughout a company’s supply chain, are often the largest source of carbon output. For businesses aiming for net zero, tackling Scope 3 is a critical, yet daunting, task.

Understanding Scope 3 emissions

To comprehend Scope 3 emissions, consider a baker’s operations. Scope 1 emissions come directly from the baker, such as smoke from their oven. Scope 2 covers indirect emissions like the energy used for their electric whisk. Scope 3, however, encompasses emissions from other areas of their supply chain.

The CGF’s new targets aim to address emissions from suppliers contributing 60–80% of a company’s Scope 3 output. 

Setting a new supply chain standard

These targets arrive as consumer goods companies face increased pressure from regulators and eco-conscious consumers to minimise their carbon footprints. The coalition’s strategy prioritises creating uniform supplier standards, while still allowing companies flexibility to address unique challenges.

“This is a critical step toward making the supply chain more resilient,” says Grant Sprick, Vice President of Climate & Environment at Ahold Delhaize.

“By introducing these new targets, we are establishing a much-needed suite of supplier expectations that will help address Scope 1, 2 and 3 emissions.”

The initiative emphasises adaptability, enabling companies to tailor solutions while maintaining consistency across the sector.

Archana Jagannathan, Chief Sustainability Officer at PepsiCo Europe, highlights this aspect: “The flexibility of these targets is key.

"It allows businesses to tailor their approach, making sure that the most relevant sustainability issues are prioritised, while maintaining the momentum to drive sector-wide change.”

Overcoming challenges and fostering collaboration

Despite the urgency, reducing Scope 3 emissions has historically been challenging. Obstacles include varying regional regulations, technological constraints, and the need for significant investment.

However, the CGF’s approach signals a shift towards collective action, pooling resources and knowledge to drive systemic change.

Rebecca Marmot, Chief Sustainability Officer at Unilever, highlights the importance of collaboration: “By working together and setting consistent expectations for suppliers, we can create meaningful, long-term change across our industry.

"These targets demonstrate our collective commitment to reducing environmental impacts at scale, helping to secure a more sustainable future for all.”

The coalition’s approach doesn’t stop at direct suppliers. By advocating for cascading expectations down the supply chain, it aims to encourage widespread adoption of sustainable practices. This ripple effect reflects the interconnected nature of global supply chains and the need for comprehensive action.

A step towards a sustainable future

The CGF’s targets also align with its role as a United Nations Race to Zero Accelerator. By contributing to the broader mission of limiting global warming to 1.5°C, these targets reinforce the industry’s role in achieving the goals of the Paris Agreement.

While the coalition recognises these targets as an initial step, they represent a foundation for further progress. For many companies, this framework marks the beginning of their journey toward sustainable supply chains.

As the consumer goods sector confronts the complexities of emissions reduction and evolving consumer demands, initiatives like the CGF Towards Net Zero Coalition highlight the power of collective action in shaping a greener future.

Explore the latest edition of Manufacturing Digital and be part of the conversation at our global conference series, Manufacturing LIVE.

Discover all our upcoming events and secure your tickets today.

Manufacturing Digital is a BizClik brand.