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Over the last few years, companies have made significant progress on Scope 3 emissions. Coverage has expanded across categories and suppliers; product carbon footprints are becoming more common, and many organizations have invested heavily in tools, reporting frameworks, and supplier engagement programs.
These shifts – and the challenges that come with them – were reflected in discussions at the Scope 3 Peer Group’s Strategy Day, where companies shared practical lessons on what is working and where progress is still proving difficult as programs mature.
On paper, this progress should make decarbonization easier.
In practice, many companies are discovering the opposite.
As supply chain data improves, understanding emissions is only the first step. The harder part is deciding where and how to act.
Scope 3 is entering a new phase. One that’s less about measurement and more on choosing where and how to act once emissions hotspots are visible.
The nature of the challenge has changed
Scope 3 visibility is advancing rapidly. Many companies now have a clearer view of emissions across their supply chains than they did even a few years ago. Without that visibility, meaningful reduction would not be possible.
Teams are moving from asking “how do we measure?” to harder questions such as:
- Where do we act first?
- Which suppliers or technologies will deliver the biggest long‑term impact?
- How do we balance reductions with cost, supply security, and operational risk?
Several organizations described building emissions inventories covering most of their supply chain spend. While this improved transparency, it also surfaced hundreds of potential reduction opportunities – forcing teams to prioritize where effort would have the greatest impact.
Emissions data highlights opportunities; it doesn’t make the roadmap.
Better data is exposing more trade-offs
Improved Scope 3 data allows companies to compare suppliers, materials, and production methods in far greater detail. Many can now model how switching energy sources, changing materials, or adjusting logistics affects both carbon intensity and cost.
One company described building internal models combining supplier emissions, energy prices, spend data, and grid forecasts. These tools allow category managers to simulate sourcing decisions over multiple years. Often there are several viable pathways, not one obvious choice.
Practitioners highlighted that improved data is also surfacing previously overlooked hotspots, particularly in industrial heat and raw material feedstocks. Emissions can vary significantly depending on energy sources or extraction locations, reinforcing the need for supplier-specific and location-based analysis.
Better data exposes these trade-offs. It does not remove them.
As a result, teams spend more time evaluating options and explaining decisions internally. The question is no longer whether emissions should influence sourcing decisions – it is how to choose between multiple credible pathways.
Supplier comparisons are not always straightforward
Improved data availability is also revealing comparability challenges. Product carbon footprints and life cycle assessments are becoming more common, but they are not always built using consistent assumptions or boundaries. Suppliers may rely on different methodologies or data sources, which makes comparisons harder.
Practitioners described situations where two suppliers reported significantly different product carbon footprints, only to find the gap was driven by methodological differences rather than operational performance. Additional analysis was needed before the data could inform sourcing decisions, taking more time and effort.
Under reporting pressure, many suppliers publish standardized, top‑level data. This allows suppliers to reduce the burden placed on them, but it can also flatten meaningful differences.
Many organizations now face a familiar dilemma: they have more information, but not always clearer direction on where to act first.
Long-term decisions are being made in an uncertain environment
Scope 3 reductions often require long-term supplier transformation and multi-year investment. These decisions land while standards, energy markets, and customer expectations keep shifting.
Some organizations described supplier decarbonization projects that required significant investment without clear short-term financial return. This creates tension between sustainability targets and procurement cost pressures, particularly when future carbon pricing or regulatory incentives remain uncertain.
Ultimately, this uncertainty makes prioritization harder. Especially when decisions affect long-term supplier relationships and sourcing strategies.
What leading organizations are starting to do differently
While many companies are still working through these challenges, several practical approaches are emerging among those making faster progress:
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Bringing emissions and commercial data together
- Translating emissions into commercial signals
- Supporting suppliers to build decarbonization capability
Bringing emissions and commercial data together
Some organizations are combining emissions data with financial and operational planning. These shared models integrate supplier emissions, spend, energy costs, and market forecasts to test sourcing decisions before they are made.
Peers described integrated tools that ingest material volumes and spend, supplier locations, utility costs, and emissions factors (from established databases), then overlay current and forecast grid intensities (from public datasets).
Category managers use these tools to simulate supplier and process changes under real constraints. In practice, this can expose power hotspots and support site or supplier shifts that deliver material electricity-related reductions, while maintaining commercial viability.
This approach moves conversations beyond static comparisons and toward scenario planning – helping teams understand how decisions perform over time.
Translating emissions into commercial signals
Another emerging approach is using carbon pricing or similar mechanisms to compare options more consistently.
Assigning a value to emissions gives procurement, finance, and sustainability teams a shared reference point for evaluating trade-offs. This does not treat carbon as a simple cost line. Instead, it helps organizations explain sourcing and investment decisions using both environmental and financial factors.
Some companies described integrating emissions performance directly into supplier scorecards or sourcing decisions, allowing cost and carbon to be evaluated in parallel.
In some cases, emissions criteria are also being introduced into tender requirements and supplier performance frameworks, creating clearer expectations that decarbonization performance will influence future business opportunities.
Supporting suppliers to build decarbonization capability
Supplier engagement is also evolving. Early Scope 3 programs focused heavily on collecting data. Newer programs focus more on helping suppliers reduce emissions.
Several organizations described launching supplier programs combining training, workshops, and on-site technical support, with resources focused on suppliers responsible for the largest share of emissions.
Some teams are segmenting suppliers by decarbonization maturity, allowing engagement strategies to vary from foundational capability building to joint reduction planning with more advanced partners.
Unsurprisingly, organizations are also finding that suppliers respond better when expectations are aligned across customers. Fragmented or repetitive data requests often slow progress rather than accelerate it.
At the same time, several practitioners highlighted regional and supplier size differences as a growing implementation challenge. Smaller suppliers and those operating across multiple markets often face language barriers, limited internal resources, and competing customer reporting requirements.
Programs that simplify data requests and provide localized support are significantly more effective in driving participation and progress.
Scope 3 is a shared business challenge
Scope 3 decisions rarely sit within a single team. Procurement plays a central role, but supplier choices are shaped by product design, cost targets, operational requirements, and customer expectations.
Nevertheless, procurement teams are often where carbon targets meet commercial reality. Progress is faster when emissions considerations are introduced early in product and sourcing decisions rather than added later.
Some organizations are developing clearer governance structures to ensure emissions are considered alongside other business priorities. Without this, progress often depends on individual champions or one-off approvals.
The next phase of Scope 3
Scope 3 work is far from finished, but the nature of the challenge is changing.
Measurement remains essential. Supplier engagement remains critical. Tools and reporting frameworks will continue to evolve. Yet these alone are unlikely to drive the next wave of emissions reductions.
The organizations making the most progress are those finding practical ways to turn emissions data into clear, confident actions that guide supplier choices, sourcing strategies, and long-term investment planning.
Scope 3 is moving beyond visibility. The next phase will be defined by how effectively companies choose where and how to act once emissions hotspots are understood.
