The world faces a challenge to halve greenhouse gas emissions every decade until 2050 and stabilize the Earth’s rise in temperature at around 1.5°C. Achieving these objectives requires the fastest economic transition in history, which will be predicated on both divestment and investment at scale. Close collaboration across all sectors and value chains is essential.
Small- to medium-sized enterprises (SMEs) play a vital role in meeting these objectives. Comprising an estimated 80 percent of total businesses worldwide, according to the Exponential Roadmap, they play an important role in both local communities and global supply chains. Supporting and enabling SMEs to divest, invest and scale their climate action efforts accordingly will be critical to driving exponential climate action across our societies.
Meanwhile, the opportunities for SMEs to divest, invest and scale continues to be challenged by the socio-economic impact of the ongoing Covid-19 pandemic. While the pandemic’s shockwaves have reverberated across most enterprises, its impacts on SMEs have been particularly severe and disproportionate – reinforcing a need for business resilience in order to survive and thrive in the post-Covid-19 recovery.
1.5°C Supply Chain Leaders
Part of the Exponential Roadmap, the 1.5°C Supply Chain Leaders is a new initiative which unites major multinational corporations, including Ericsson, IKEA, Telia, BT Group and Unilever, with a shared ambition to drive exponential climate action across global supply chains, many of which depend on countless SMEs.
As a member of the initiative, Ericsson has also renewed its commitment to driving climate action as part of its wider role in society, as well as promoting, rewarding and inspiring action across its global supply chain. As part of the initiative and aligning with Ericsson´s supply chain climate ambition, Ericsson has already started to include climate related targets in supplier assessments and purchasing criteria.
SME Climate Hub
As part of the initiative, Ericsson has also committed to joining a new SME Climate Hub – a platform for the provision of tools, knowledge and best practice – both for implementing a robust climate strategy and supporting broad action – across its global SME supply chain.
Moti Gyamlani, Head of Group Sourcing at Ericsson, says: “We have committed to work with our suppliers to be aligned with the 1.5°C ambition, meaning halving emissions every 10 years. We recognize the challenge this poses to our suppliers, and we see the Race to Zero ‘SME Climate Hub’ as a great initiative to collectively support many companies to start their climate action. We need collaboration, and as such please join us in this race to zero.”
A full value chain approach
The initiatives complement Ericsson’s full value chain approach, which already includes rigorous management of the social, ethical, environmental and human rights impacts of its supplier base.
Beyond its commitment to reduce the negative impacts of its own operations, as well as improve the environmental and energy performance of its products to reduce societal environmental impacts, Ericsson has also prioritized the reduction of its supply chain carbon footprint.
As such, Ericsson already requires its suppliers to plan for implementation of programs and targets to reduce their climate emissions to be in line with the Paris agreement to limit global warming to 1.5°C. By 2025, Ericsson’s suppliers responsible for 90 percent of the company’s supply chain carbon emissions will have a 1.5°C target.
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