Introduction

In this module we will discuss the benefits to both a Supplier and Customer in creating a PCF.  Module Outcomes: Understand how PCFs enable you to understand the key emission sources within your supply chain and how you can de-risk your strategy using PCF insights Understand how you can use PCFs to build a competitive advantage over your competitors Understand the role of PCFs in fostering collaborative decarbonization

The "Visibility" Challenge

For most organizations, when considering a Scope 1, 2, and 3 inventory, most emissions will be Scope 3. This means that most of the emissions associated with a supply chain outside of an organization’s direct control. However, to build decarbonization policies and reduction plans aligned with the latest climate science, large organizations must also address these indirect emissions.

💡For many businesses, Scope 3 emissions account for more than 70 percent of their carbon footprint.

A key barrier to progress is obtaining transparent and precise assessments of emissions from suppliers to get enough certainty of where decarbonization opportunities can be found. Transparent and primary data enables the identification of emission hotspots, and companies across a supply chain to collaborate and develop strategies to manage and reduce emissions.

Product carbon footprints (PCFs) can provide customers with greater insight into the emission footprint of products and categories, whilst also enabling manufacturers to build more effective decarbonization strategies for their own supply chain.

Benefits of creating PCFs

• Better understanding of emissions sources in your own supply chain

  Building PCFs that can be used as primary data sources across the supply chain enables greater transparency for buying companies as well, whilst also allowing manufacturers to spot emission hotspots and build effective decarbonization strategies. ​

• Become equipped to decarbonize product portfolios and gain a competitive edge

  PCFs can be used to single out hotspots of emissions and potential inefficiencies in production, distribution, and disposal. These may lead to additional cost-saving benefits which can help to reduce the costs of production and lead to a competitive advantage.​
• Develop mitigation strategies and reduction plans to mitigate your footprint

  Having credible reduction plans is key to achieving targets for decarbonization, and PCFs can be used as a diagnostic tool for identifying actions that will reduce emissions the most.​

• Compliance with customer requests and product-centric regulation

  PCFs can be useful in helping to manage supply chain emissions and ultimately decarbonize and so customers may increasingly be requesting PCFs. Equally, customers may be seeking to become aligned with reporting requirements of product-centric regulation (e.g., EU CBAM, Ecolabelling).​

• Access insights which help to understand your risk exposure to carbon pricing in emerging regulations

  Emerging regulation may soon be applicable to your product portfolio, and PCFs give early insight into the risks and costs associated with new regulations.​

Self-assessment Quiz

Now that we have learnt more about the benefits of creating PCFs for both suppliers, customers & consumers, test your knowledge by completing the below self-assessment quiz

Please note that completing the self assessment quiz also keeps your customers informed on your progress if they have asked you to engage with the M2030 PCF Academy. M2030 will never share answers or performance, simply that you have completed the quiz for this module. 

Cheat sheet PDF

You can download a PDF version of the benefits of creating PCFs below:

• PCF Essentials 2 - PCF Benefits.pdf1000 KB