Green supply chain utopia is coming

An unavoidable trend that will change the way we do business in Europe is certainly the “Green supply chain”. This topic is mainly faced by big corporations, but in reality it is involving more and more small and medium sized enterprises. But what does it mean to create a sustainable supply chain? 

For large companies, it means ensuring that all their suppliers and employees have virtuous behaviors to contribute to the overall sustainability of the company. In fact, according to ESG (Environmental, Social and Governance) parameters, even all the indirect emissions (scope 3) are reflected in the sustainability balance of the entire supply chain. 

Large companies wishing to reach Net Zero therefore need a virtuous network of small and medium-sized companies committed to the same journey. That is why it is important that more and more players in the supply chain at all levels take actions toward reducing CO2 emissions. And the virtuous suppliers will gain a strong competitive advantage, while unsustainable suppliers risk being left behind.

Moreover with the SFDR regulation also financial institutions prefer to invest or finance “greener” entities. So all the players are incentivized to make more sustainability oriented strategies.

The first step is to quantify the emissions

To calculate how much CO2 is emitted as a result of specific activities, you must look at the GHG Protocol, a globally recognized standard for measuring and managing greenhouse gas (GHG) emissions from companies and their value chains, as well as emission reduction measures.

These emissions can be direct (controlled by the company itself), or indirect (such as the CO2 emitted by the clients or the suppliers of the company).

Dedalo AI is targeting indirect software emissions and is starting with websites. So if you want to assess your website’s environmental impact, try our free version or contact us for more info.

The second step is to reduce the emissions

With accurate measurements a company can develop a strategy to reduce or to compensate for those emissions.

Dedalo AI helps companies in both solutions: first of all we offer an offsetting solution through our certified carbon credits providers, so that a company can compensate for the emissions it generates and after a year (during which we will collect data and improve our algorithm) we will offer an optimization solution that will help the companies to improve their code and therefore reduce their CO2 emissions.

The economic benefit of reducing emissions

To sum up some of the benefit your company can have by reducing emissions are:

• Competitive advantage and ability to have partnerships with big companies
• Less risk for investors (ESG risk) and eligibility for impact investing and financing
• Compliance with regulations (CSRD, ESRS, SEC, SFDR)
• Improved brand culture & identity

Starting a decarbonization journey faster than your competitors only brings benefits. To learn more on how we can help you, contact us ([email protected]) or try our beta.