Only 6% of UK businesses are on track to meet or exceed their supply chain (Scope 3) emissions targets, according to a new report.
The report also found UK businesses are falling behind European and major economy peers on key metrics, including developing climate transition plans (26%), collecting primary data from suppliers (3%), and collecting product-level data (5%).
The new Carbon Action Report, published by business sustainability ratings provider EcoVadis and Boston Consulting Group, is being launched during New York Climate Week.
As well as only 6% being on track to meet their target, only 14% of UK businesses are setting targets for supply chain emissions. The report states that around two-thirds of UK companies are not reporting their supply chain emissions.
This exposes UK businesses to significant financial risks and puts national and global climate goals under threat.
According to the report, low overall action exposes UK companies to ‘significant financial risks’ and ignoring supply chain emissions could cost companies globally $500 billion in annual liabilities by 2030.
UK companies performed better than ‘any major economy’ when reporting and acting on Scope 1 and Scope 2 emissions, which cover both direct and indirect emissions associated with their own operations. This could include company vehicle fleets, equipment, and the generation of purchased electricity, heat and steam.
55% of UK companies are reporting Scope 1 and 2 emissions, the report found, with 26% having set targets across the two scopes. However, only 7% indicated that they are on track or ahead of schedule to meet their targets.
Commenting on the report’s launch, Pierre-François Thaler, co-founder and co-CEO of EcoVadis, said: “While the UK may be outperforming against the major economies, the overall performance is still very low and nowhere near the level it needs to be if it’s going to meet its net zero ambitions.
“This exposes UK businesses to significant financial risks and puts national and global climate goals under threat. We are at a pivotal point in carbon action globally, and the UK is no exception.”