Summary
Details
- Global
Participation is not legally mandated but is expected for selected strategic suppliers.
Exceptions may apply for:
Suppliers with limited capacity in early stages.
Regions with constrained renewable energy availability.
However, suppliers are required to demonstrate clear progress toward compliance.
Deep dive
📩 Stay ahead of climate regulation and reporting shifts
Regulatory updates, reporting standards, and new climate software — distilled into one concise weekly brief for decision-makers.
Thanks for signing up. Please check your inbox to confirm your subscription.
Practical updates. Once per week.
What’s Required
The Schneider Electric Zero Carbon Project represents a highly targeted, performance-driven supply chain decarbonization framework, focused on the company’s most emissions-intensive suppliers. Unlike broader participation-based initiatives, it imposes quantified reduction obligations and operational requirements on a defined group of strategic suppliers.
The program is designed to address Schneider Electric’s Scope 3 emissions, particularly those associated with purchased goods and services, which constitute a significant portion of its overall carbon footprint.
1. Targeted Supplier Scope and Selection Criteria
The program focuses on approximately 1,000 key suppliers, selected based on:
Contribution to Schneider Electric’s Scope 3 emissions.
Strategic importance in the supply chain.
Energy intensity of operations.
These suppliers represent a disproportionate share of emissions, making targeted intervention more effective than broad, low-intensity engagement.
2. Mandatory Emissions Reduction Targets
Participating suppliers are required to achieve absolute emissions reductions, with a core target of:
50%reduction in Scope 1 and Scope 2 emissions by 2025 (baseline year defined per supplier engagement).
This creates a quantified compliance obligation, distinguishing the program from more flexible supplier initiatives.
Suppliers must:
Establish baseline emissions.
Define reduction pathways.
Demonstrate measurable progress toward targets.
3. Renewable Electricity Adoption Requirements
A key pillar of the program is the transition to renewable electricity.
Suppliers must:
Increase the share of renewable electricity in their energy mix
Procure renewable energy through:
Power purchase agreements.
Renewable energy certificates.
On-site generation.
Electricity procurement strategies must align with:
Market availability.
Regulatory frameworks in operating regions.
4. Energy Efficiency and Operational Improvements
Suppliers are required to implement energy efficiency measures, including:
Optimisation of industrial processes.
Upgrades to equipment and infrastructure.
Reduction of energy intensity per unit of output.
These measures are expected to deliver immediate emissions reductions while supporting longer-term decarbonisation.
5. Data Collection and Digital Monitoring Systems
Suppliers must develop robust data systems to track:
Energy consumption.
Emissions performance.
Progress against reduction targets.
Data must be:
Reported regularly to Schneider Electric.
Consistent with recognised methodologies, such as:
Greenhouse Gas Protocol.
Digital tools are used to:
Monitor supplier performance.
Identify improvement opportunities.
Support reporting and verification.
6. Supplier Engagement and Capability Building
Schneider Electric provides:
Technical guidance on energy efficiency and decarbonization.
Access to digital platforms for emissions tracking.
Best practice sharing and training.
This creates a capacity-building component, enabling suppliers to meet stringent requirements.
7. Performance Monitoring and Accountability
Supplier performance is tracked through:
Emissions reduction progress.
Renewable energy adoption rates.
Data reporting quality.
Suppliers are evaluated against defined KPIs, creating a performance-based compliance system.
8. Integration with Procurement and Commercial Decisions
Climate performance is integrated into procurement processes.
Suppliers that fail to meet requirements may face:
Reduced business opportunities.
Lower prioritisation in sourcing decisions.
High-performing suppliers may benefit from:
Preferred supplier status.
Increased contract volumes.
This introduces direct commercial incentives and consequences.
9. Alignment with Corporate and Regulatory Frameworks
The program aligns with Schneider Electric’s broader climate commitments, including:
Net-zero targets.
Science-based emissions reduction pathways.
It also supports alignment with:
Climate disclosure frameworks.
Sustainable finance requirements.
Suppliers must ensure consistency between data reported to Schneider Electric and other regulatory or investor disclosures.
10. Multi-Tier Supply Chain Influence
Although focused on Tier 1 suppliers, the program encourages:
Engagement with sub-tier suppliers.
Extension of decarbonization practices upstream.
This creates indirect multi-tier influence, amplifying impact across the supply chain.
Important Deadlines
Program launch: 2021
Key target:
2025: 50 percent reduction in supplier Scope 1 and 2 emissions
Long-term alignment:
2030 and beyond: continued decarbonisation consistent with net-zero pathways
Reporting cadence: ongoing with periodic updates
Current Status
The program is actively implemented, with hundreds of suppliers engaged globally.
It is considered one of the most quantitatively rigorous supplier decarbonisation initiatives, due to its clear targets and performance tracking.
Penalties for Non-Compliance
Non-compliance may result in:
Reduced supplier ratings.
Loss of preferred supplier status.
Decreased procurement volumes.
Persistent non-compliance may lead to exclusion from Schneider Electric’s supplier base.
Examples of Known Violations
Common challenges include:
Failure to achieve targeted emissions reductions within required timelines.
Limited access to renewable energy in certain regions.
Incomplete or inconsistent emissions data.
Delays in implementing energy efficiency measures.
These issues can affect supplier performance evaluations.
Resources
Cut through the green tape
We don't push agendas. At Net Zero Compare, we cut through the hype and fear to deliver the straightforward facts you need for making informed decisions on green products and services. Whether motivated by compliance, customer demands, or a real passion for the environment, you’re welcome here. We provide reliable information. Why you seek it is not our concern.