Four Conversations That Are Shaping How Companies Tackle Scope 3. Lessons from the PCF Clinic

It has now been over a week since PACT joined the PCF Clinic at the Scope 3 Peer Group annual meeting in Chicago.

Over 80 questions were submitted in advance, we had a packed agenda and what took place was a PCF Clinic that ran out of time before it ran out of steam!

Here's what we're still thinking about at PACT…

The "modelled emission factors" gap is real: and we're already making progress on scoping it

Matt Seiler from Schneider Electric presented a market painpoint which many in the ecosystem are feeling: there's a gap between the spend-based emission factors that exist today, and a fully comprehensive PACT-aligned PCF.

Many companies aren't waiting around for this gap to close. They're already asking suppliers targeted questions about the two or three parameters that drive most of the footprint, and folding the answers into their accounting. One company during the PCF Clinic described already doing exactly this for dairy. Veritas confirmed these approaches holds up under Big Four assurance.

So, the question isn't whether this approach works. It's whether through the PACT Ecosystem, we can make this approach official: by working with our membership, by getting academic validation, by working with the assurance community and embedding this into existing frameworks.

That kind of work needs a neutral, shared home. That's what the PACT community is currently exploring, as part of the Product-Level Data Use Case Forum.

Suppliers don't resist PCF requests because they don't want to share data

A second reflection is on supplier PCF requests. What is clear from the supplier voice, is that resistance to share PCF is not driven from simply “not wanting to”. Instead, what came through is resistance stems from ambiguity in the ask from their customers: the how and the why. When suppliers understand what the data their customers are requesting will be used for; and when we're clear about what a PACT PCF data package contains (and moreover what it doesn't contain); the conversation changes. Comparability and trust are still real challenges in this picture, but what is clear is that clarity is a foundation for enabling both, not customer pressure.

Monetising decarbonisation is starting to happen

We were joined by Kelly Gilroy, VP Commercial Sustainability at Univar Solutions, representing both Together for Sustainability (TfS) - an industry initiative PACT works closely with - and Univar itself, a global chemicals and ingredients distributor with over 100,000 customers and more than 3,000 suppliers.

As a distributor, Univar sits right at the intersection of supply and demand for carbon data: and what Kelly described is a market that is beginning to move.

The insights that came through were, first, that decarbonisation investment only happens when there's a credible business case behind it. What's emerging, through mechanisms such as mass balance attribution and carbon footprint ledgers, is a way for suppliers to monetise the decarbonisation work they've already done, by directing it to the customers who specifically value and will pay for it. The premium becomes commercially viable, because it's targeted rather than spread uniformly across an entire product portfolio.

The buyer-demand signal is real

A second key insight from Kelly still sticking with us, was that the buyer demand signal is real. Univar now requires customers to complete a short survey upon requesting PCF data; capturing what they intend to do with the data and what quality they need. They are finding that the more mature customers are increasingly requesting: ‘please don't give us spend-based data’. This signal is getting louder; and it matters for how we scope the aforementioned modelled emission factor gap within the PACT community.

If you're curious about how PACT is working with members to tackle this in practice, including the concrete outputs we're developing to measure and enable the transition from secondary and spend-based data, towards supplier-specific primary data: reach out at pact@wbcsd.org.

The “comparability problem” needs a more honest conversation

Two PACT-conformant PCFs for the same product can show very different numbers, not because one product is lower carbon, but because of the methodological choices made in calculating the footprint. A procurement buyer seeing those numbers side by side will pick the lower one. That's a problem. The PACT Usability Model which we're currently piloting with 30 corporates and several solution providers, is part of our answer to this. A shared language for what a PCF discloses, and whether it's fit for a specific purpose, is how we get from data exchange to decisions that actually hold up.

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There's a lot still to do. In rooms like the one in Chicago, and the conversations that take place within (and spill out), are how this work gets done.

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In partnership with Scope 3 Peer Group

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