In many areas there are opportunities to work with our suppliers to improve environmental performance. As we build enduring relationships with many suppliers, we seek to work with them progressively to improve performance. Examples include:
- improving the fuel efficiency of vehicles with our vehicle suppliers;
- reducing waste and improving recycling levels with our waste management suppliers;
- cutting energy usage with our energy suppliers through better monitoring and metering;
- improving durability of parts;
- reducing packaging and mileage through elimination of waste.
Specific examples can be found on the Procurement Case Studies page. In many cases, measuring performance improvements in a contract remains a challenge as none of our suppliers work exclusively for us.
Reducing carbon in the supply chain
For the first time this year we have established an initial indication of the size of our Scope 3 (supply chain) carbon emissions relative to our Scope 1 and 2 emissions, which are those arising directly from the operation of the business. The work was undertaken by Carbon River using hybrid Environmental Input-Output (EIO) analysis. This method takes the procurement spend on different items and uses an EIO database to calculate probable carbon emissions from different product groups.
Total tonnes CO2e footprint - Scope 1, 2 and 3
Supply chain CO2e emissions as a percentage of total emissions in the uk
- Scope 1 - 60% - 1,143,133 (Emissions from vehicles and gas usage)
- Scope 2 - 15% - 280,167 (Emissions from purchased electricity)
- Scope 3 - 25% - 478,354 (Supply chain emissions)
Note: This analysis does not include the emissions associated with leased items such as railway lines and trains as FirstGroup does not have direct control over the procurement of these items.
This analysis has shown that although the business's supply chain carbon emissions are significant, the majority of emissions are Scope 1 and Scope 2 and are primarily due to the high volume of fuel used by the company. Improving fuel efficiency with a long-term move towards alternative fuels or technology will therefore be the biggest driver in reducing the company's carbon emissions. This is mirrored by the fact that fuel is the second largest supply chain impact after electric traction energy. The other biggest impacts relate to vehicles, parts and engineering materials.
The next step is to share these findings with our procurement and supplier management team and key suppliers to explore how we can reduce emissions in the supply chain.