OSLO (Reuters) - Too few businesses are working with their suppliers to reduce greenhouse gas emissions, according to study that praised 29 companies including General Motors (N:GM), Sky (L:SKYB) and Sony Corp (T:6758) for taking the lead.
"The supply chain is the new frontier in environmental responsibility – an area rich with opportunity that remains mostly unexplored," non-profit group CDP, formerly known as the Carbon Disclosure Project, wrote in its report published on Tuesday.
Many companies set their own goals to limit climate change but omit greenhouse gas emissions related to products they buy from others, such as metal components, electronic parts, timber or crops, said CDP, describing supply chains as a "missing link for sustainability".
"The vast majority of emissions of the average company are in the supply chain," Dexter Galvin, head of CDP's supply chain programme, told Reuters. "Too few companies have engaged with their suppliers."
Other companies among those it praised for addressing climate change with their suppliers include Bank of America (ACN:B), Nestle (S:NESN) and AkzoNobel (AS:AKZO).
Overall, it found that only 22 percent of 4,300 companies surveyed were working with their suppliers to reduce emissions.
The report, which also reviewed action to improve use of water, said that respondents reported cuts in emissions equivalent to 434 million tonnes of carbon dioxide in 2016.
They also reported cost savings of $12.6 billion in 2016, mostly related to improved energy efficiency, almost double reported savings of $6.6 billion from 2015.
"Action on climate change and water is not only the right thing to do, but the smart thing to do," Patricia Espionage, head of the U.N. Climate Change Secretariat, wrote in a preface to the report.
She said that the 22 percent rate of involvement by companies on climate change "is not enough", especially when the world was setting new temperature records. Last year was the hottest on record for the third year in a row.