- The IPCC predicts the planet will warm by 1.5°C over the next 2 decades without drastic action to eliminate GHG emissions, putting a key goal of the Paris Agreement at risk.
- As more companies commit to net zero emissions by 2050, there is a realisation most of the GHG emissions in their value chain come from outside their own direct operations.
- Segmenting your value chain, sharing your ambition and supporting your suppliers can speed our progress toward net-zero.
If the planet continues to warm, the impacts on business – and global supply chains – will be catastrophic. Climate change is also, without question, a socio-economic crisis affecting the lives and livelihoods of millions of people today. It wreaks havoc on harvests and the availability of clean water, and is contributing to an increase in life-threatening extreme weather events. Decisive action on a global scale is needed now.
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In 2020, Unilever set out new actions to fight climate change, protect and regenerate nature, and to preserve resources for future generations. Central to this is our goal to achieve zero emissions across our own operations by 2030, and net zero across our value chain by 2039.
It’s no coincidence that in the same year, we launched our Partner with Purpose programme – an evolution in the way we work with suppliers that allows us to get closer than ever before to further deliver on responsible and transparent innovation and sourcing to meet our ambitious commitments.
The role of partnerships in driving positive climate action
Purpose-led partnerships can significantly increase a company’s innovation capacity. By partnering with businesses who have leading experts in their respective fields, Unilever has introduced new science and technologies to reduce or replace everything from plastics to carbon. Some examples of how we have done this include:
- Partnering with specialty chemicals company Evonik to develop a first-of-its-kind biodegradable and renewable ingredient (rhamnolipids). This innovative ingredient was introduced in Quix in Chile, the first time it has been used in a household cleaning product anywhere in the world.
- Working alongside two partners – carbon recycling company LanzaTech and India Glycols, a manufacturer of green technology-based chemicals – we produced a surfactant made from carbon emissions.
- Through a partnership with diversified chemicals partner SABIC, Magnum became the world’s first food brand to use recycled polypropylene plastic in its packaging.
We also use partnerships to drive transparency, traceability and action across our value chain, particularly in the first mile, from the individual crop source to a mill. We are partnering with Orbital Insight, a US tech company, on a pilot that uses geolocation mapping to improve the visibility of our sourcing beyond direct suppliers and mills so that we can map the origins of our crops to the municipality and farm level. And we are using satellite and geolocation technology from Google and Descartes to work in partnership with our suppliers and industry partners to create traceable and transparent supply chains.
When we assess the urgency of climate challenges and the scale of emissions from our upstream value chain, it becomes clear that we also need to motivate our entire supply base to take ambitious actions to advance global climate goals.
Here’s how – Segment, Share and Support.
Segment your value chain
Your journey should begin with segmenting your supplier base and value chain based on the GHG emissions footprint and deforestation risk. From here, you can identify the biggest impact opportunities and focus your efforts accordingly.
At Unilever, we source from over 56,000 suppliers. We have, therefore, developed an encompassing approach to cover our entire upstream value chain and identified where we needed to focus our efforts for maximum impact.
Unilever’s raw and packaging materials account for more than half of our direct value chain emissions, so we mapped them to understand where in the value chain most emissions arise by material type and which suppliers we buy the majority of these materials from. The result was a list of 300 suppliers who contribute a meaningful share of our upstream Scope 3 emissions, and with whom we will work with as a priority.
Share your ambition
Once you have segmented your value chain and are clear on where your biggest impact lies, it’s time to share your ambition.
To engage all 56,000 of our suppliers, we have launched the Climate Promise, through which we are inviting supply partners to demonstrate their shared values and commitment to reducing the GHG footprint of their value chains.
For initiatives such as the Climate Promise to be a success, it’s critical a company clearly articulates its expectations of suppliers. For this reason, we are asking all suppliers wanting to commit to our Climate Promise to:
- Set a public climate target to halve absolute GHG emissions by 2030.
- Publicly report progress towards meeting this target.
- Share GHG emissions / footprint data with Unilever.
To ensure those suppliers with the greatest climate impact commit to our Climate Promise, we will underpin it with the Unilever Climate Programme. This programme facilitates our efforts to support the 300 suppliers we identified above with hands-on guidance and access to tools and resources.
We are starting immediately with a small group of diverse suppliers who can help us shape the programme, before moving to a pilot involving about 40 suppliers in 2022. We will continue to onboard new suppliers to the programme over the 12-18 months that follow, until all 300 suppliers benefit.
At the end of the day – we all win or lose together.
Supporting suppliers with their journey
Once you’ve shared your ambition and secured engagement, the next step is to ask suppliers to measure, reduce and report on emissions in their own supply chain, so you can scale your own progress, as well as that of the wider industry. Some will need help with this process, making it helpful to understand where different suppliers are on their climate journey: Have they been working on the issue for many years? Or are they just starting out? Understanding this allows you to support them with a tailored approach.
One way you can support them in this process is by sharing your own tools, approaches and plans. In our case, we openly share the Unilever Climate Transition Action Plan, which can be replicated in other manufacturing operations.
Linking suppliers to knowledge from well-established trade organizations makes sense. Climate organization Exponential Roadmap, for example, has developed the 1.5 degree business playbook for companies and organizations that want to align with the 1.5°C and net-zero ambition.
What is the World Economic Forum’s Sustainable Development Impact summit?
It’s an annual meeting featuring top examples of public-private cooperation and Fourth Industrial Revolution technologies being used to develop the sustainable development agenda.
It runs alongside the United Nations General Assembly, which this year features a one-day climate summit. This is timely given rising public fears – and citizen action – over weather conditions, pollution, ocean health and dwindling wildlife. It also reflects the understanding of the growing business case for action.
The UN’s Strategic Development Goals and the Paris Agreement provide the architecture for resolving many of these challenges. But to achieve this, we need to change the patterns of production, operation and consumption.
The World Economic Forum’s work is key, with the summit offering the opportunity to debate, discuss and engage on these issues at a global policy level.
We believe any costs associated with emission reduction should be viewed as a wise investment in building a purpose-led, future-fit business. After all, collective knowledge of the climate crisis is growing and consumers are becoming more demanding of brands and companies as a result. Investors are also increasingly seeking to build net-zero aligned portfolios and high-quality talent is seeking employment with purpose-led companies.
Mobilising the entire business sector is nothing short of critical if we are to collectively achieve the 1.5°C ambition and to halve emissions before 2030, to be able to deliver the Paris Agreement.
No one business can fight climate change alone. Join the fight.