In the face of growing global warming concerns and impending governmental regulations, the need for organisations to start carbon reporting has never been more critical. The European Union, for example, is set to enforce mandatory carbon reporting through the Corporate Sustainability Reporting Directive (CSRD) from 2024 onwards.
Climate action is largely data-driven, and therefore, companies are highly dependent on efficient, standardised and compliant carbon reporting from their suppliers, especially when it comes to Scope 3 emissions. To ensure your suppliers are committed to robust carbon reporting, it is important to clearly outline your expectations in both tender terms and Service Level Agreements (SLAs) with your Logistics Service Providers (LSPs).
What Are Some Key Considerations for Tender and SLAs with LSPs?
Free and Accessible Carbon Reporting: The carbon reporting needs to be made available to your organisation free of charge in a format that is easily accessible and electronically readable, such as XLS, CSV, or via API. By specifying this requirement, you protect your organisation from unexpected costs, as some LSPs may attempt to monetize carbon reporting services.
Frequent Reporting: To effectively monitor and manage your carbon footprint, carbon reporting should also be provided on a regular basis, at least monthly. Timely and frequent reporting allows your organisation to respond promptly to any emerging trends or issues and take proactive steps towards reducing your carbon emissions.
Compliance with Regulations and Standards: The generated carbon reports must adhere to governmental regulations and follow applicable guidelines and frameworks, such as ISO 14083, CSRD, and CBAM (Carbon Border Adjustment Mechanism). By requiring compliance with these standards, you ensure that the data provided by your LSPs aligns with industry best practices and can be used for regulatory reporting and sustainability benchmarking. This commitment to compliance also safeguards your organisation against potential legal and reputational risks.
As carbon reporting becomes increasingly vital for businesses worldwide, incorporating these three key considerations into your tender processes and SLAs with LSPs will help you navigate the complexities of carbon management efficiently and cost-effectively. By setting clear expectations, you ensure that your LSPs are aligned with your sustainability goals and can provide the necessary data to meet regulatory requirements.