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Follow the science

14 June 2021

Follow the science

Major procedural shifts and step changes in regulations are often adopted first at the top of the industry pyramid and then move down along the supply chain. We’ve seen this previously with Health & Safety legislation in areas like hand arm vibration and work at height, and it will be the case with sustainability as well.  

Last week the Government announced new measures that will apply to prospective suppliers bidding for major public sector contracts above £5m a year. These businesses will need to commit to be net carbon zero by 2050 and publish clear and credible carbon reduction plans before they can bid.

Companies will need to have their policies in place by this September and to have published their carbon reduction plan. 

Minister for Efficiency and Transformation, Lord Agnew, said: “The government spends more than £290 billion on procurement every year, so it’s important we use this purchasing power to help transform our economy to net-zero.” 

He believed that these measures will help green the economy, while not overly burdening businesses, particularly SMEs.

All companies bidding for contracts will need to comply with the measure, not just those who are successful in winning contracts. And they apply to all central government departments and arms length bodies, which includes organisations like Network Rail (pictured above) and Highways England. 

So this new requirement means that other companies in a bidding contractor’s supply chain will be affected. 

A carbon reduction plan sets out where an organisation’s emissions come from and the environmental management measures that they have in place. Some large companies already self-report parts of their carbon emissions, known as Scope 1 (direct) and Scope 2 (indirect owned) emissions.

These new rules will go further, requiring the reporting of some Scope 3 emissions, which even include business travel, employee commuting, transportation, distribution and waste. Scope 3 emissions represent a significant proportion of an organisation’s carbon footprint.

The blog has already reported on Network Rail’s bold initiatives to limit global warming based on science-based targets. These are goals adopted by companies that are in line with what the latest climate science says is necessary to meet the goals of the Paris Agreement. 

Science-based targets are validated by an organisation called the Science Based Targets Initiative (SBTi).  

The implications of the new bidding measures could be far-reaching. Taking Network Rail’s strategy as an example, the organisation commits to reduce absolute scope 1 and 2 greenhouse gas emission by 46% by 2029, and that 75% of its suppliers by emissions covering purchased goods and services and capital goods will have science-based targets by 2025.

Network Rail also says it will reduce absolute scope 3 indirect emissions by 28% by 2029. Scope 1 and 2 emissions are within an organisation’s control, while scope 3 are indirect. 

So if a contractor were to ask you what your company’s carbon reduction policy was, what would you tell them? 

● The CBI (Confederation of British Industry) has a useful overview of carbon footprint reduction here). 


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