Decarbonizing Together: Partnering with the Value Chain for Global Impact

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In earlier episodes of our Partnering for Sustainability series, we examined what it means to be sustainable at the corporate level, why it is a business opportunity, how Schneider Electric defines corporate sustainability and the four levers for sustainable operations. However, to impact the planet's health globally, we must take local action via regional regulations and incentives and partner throughout the entire value chain to achieve a net-zero future.

Global impact, local action

Governments worldwide drive decarbonization initiatives by blending incentives and regulations to motivate progress. Europe stands out with incentives such as the Green Deal Industrial Plan and regulations set through the European Commission's Corporate Sustainability Reporting Directive (CSRD) and Germany's Supply Chain Act. Non-compliant companies can face administrative sanctions, trade restrictions, and fines, harming their bottom line and reputation.

The 2022 Inflation Reduction Act is the largest investment in climate and energy in U.S. history. It funds initiatives to advance clean energy and mitigate climate change, including programs that adopt updated building energy codes and retrofitting federal buildings to high-performance green buildings.

China's long-standing interest in clean energy has led to its 14^th iteration of the Five-Year Plan (14FYP) for renewable energy, aiming to increase non-fossil fuel sources from 15.9% to 20%. Navigating the complex regulatory environment remains challenging for most businesses, particularly those with global operations. Schneider Electric, along with more than 4,000 other companies, has set ambitious net-zero targets aligning with the Science Based Targets initiative (SBTi), governmental regulations, and additional regional directives focusing on renovating existing buildings for energy efficiency.

Decarbonizing upstream, downstream, and in-between

We must collaborate across our entire value chain to support customers in meeting regional directives. Scope 3 (value chain emissions) accounts for 70% of an average company's total carbon emissions, so you can't make decarbonization progress without addressing your value chain.

Upstream, we work with suppliers through initiatives like our Zero Carbon Project. In this project, we help them set and achieve ambitious carbon reduction targets, understand how to quantify their current carbon emissions, and design an action plan.

Downstream, we also work with partners and customers to reduce their carbon emissions. In fact, we recently upgraded our contactor platform, leading to a 22% CO₂ reduction at the product level, reduced 50% energy consumption on coils, the use of green product materials, and 70% recycled packaging material.

We provide training and sustainability literacy through the Schneider Electric Sustainability School for both upstream and downstream partners.

In-between-is us. We are committed to designing solutions with circularity in mind. What does that mean? Like the MasterPacT MTZ Active, our products are built with green materials and packaged sustainably. They operate efficiently to reduce energy consumption and leverage advanced maintenance features to maximize the product's lifetime. Additionally, we take back products, refurbish them, and offer them to customers looking to achieve sustainability on a budget.

Empowering partners

Other leading companies are also investing in partner training and incentivization programs.

Cisco, Proctor & Gamble, and HP provide their value chain with training opportunities-Unilever, Walmart, and Zuellig Pharma support upstream and downstream partners in their decarbonization efforts. For example, both Unilever and Walmart want to reduce carbon emissions in their downstream delivery and transportation activities. Zuellig Pharma supports its upstream suppliers with a third-party carbon calculator, training, and guidance.

A Zero-Carbon future is possible, but we cannot do it alone. By partnering with our full value chain, we can collectively make a bigger impact and reach our goal of a healthier planet.

Listen to the full podcast to learn more about what Schneider Electric and other companies are doing to decarbonize their value chain. Our podcast "Partnering for Sustainability" can be found on iTunes or Spotify.

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