In the face of the global climate crisis, businesses and organisations worldwide are seeking ways to measure, manage, and reduce their carbon footprint. The PACT (Partnership for Carbon Transparency) Ecosystem has emerged as a groundbreaking solution to streamline the exchange of Product Carbon Footprint data across supply chains. In this post, we'll dive into what the PACT Ecosystem is and why it matters for companies striving to achieve their sustainability goals.
A life cycle product carbon footprint measures the total greenhouse gas emissions generated by a product, from extraction of raw materials, to end-of-life. It is measured in carbon dioxide equivalents (CO2e).
What is the PACT Ecosystem?
The PACT Ecosystem is a comprehensive framework and network designed to facilitate the exchange of standardised, reliable, and transparent product carbon footprint data. It consists of three key components:
The PACT Methodology
The PACT Methodology: A set of guidelines and standards for measuring, calculating, and reporting product carbon footprints consistently across industries.
The PACT Network
The PACT Network: A collaborative network of companies, organisations, and stakeholders committed to advancing carbon transparency and data exchange.
The PACT Data Exchange Protocol
The PACT Data Exchange Protocol: A standardised method for sharing product carbon footprint data securely and efficiently between supply chain partners.
Why the PACT Ecosystem Matters:
Enables Scope 3 Emissions Management
"Accurately quantifying and reducing emissions, particularly those in value chains (Scope 3), are key enablers for changing the global warming trajectory and avoiding the worst effects of climate change." (PACT Methodology 2.0)
Managing Scope 3 emissions is crucial for businesses to achieve comprehensive sustainability targets. The PACT Methodology provides standardised methods that make this complex task more manageable and verifiable.
CDP's 2021 Global Supply Chain Report highlights the importance of transparency to drive transformation in managing these emissions
Enhances Supply Chain Collaboration
The creation of a free and open digital network will significantly facilitate data exchange (upstream to downstream, but also downstream to upstream) and strengthen quality and credibility.
This open exchange not only promotes transparency but also fosters trust among all stakeholders in the supply chain, paving the way for more effective sustainability strategies and initiatives.
As noted by the World Business Council for Sustainable Development in their discussions on collaborative approaches.
Supports Decarbonisation Efforts
By enabling access to reliable and transparent product carbon footprint data, companies can make informed decisions to reduce their environmental impact and support the transition to a low-carbon economy.
"It is important to emphasize that the goal to accelerate decarbonisation of value chains cannot be solved by individual actors in isolation. It requires an aligned, coordinated, and open approach, driven jointly by stakeholders across all industries and value chains, including SMEs. Radical collaboration is key." (PACT Methodology 2.0”.
McKinsey & Company discuss the increasing demand for sustainable products and how companies are adapting to meet these needs in their latest insights.
Facilitates Compliance and Reporting
Aligning with emerging regulations is critical as companies globally are required to disclose more detailed and standardised climate-related information. This compliance not only meets regulatory demands but also helps companies stay ahead by managing risks and capitalising on opportunities related to climate change.
"The PACT Methodology builds on the longstanding work with the World Resources Institute under the GHG Protocol to take a cross-sectoral approach to help organisations develop and exchange primary data-based product carbon footprints (PCFs) across the value chain. The requirements captured in it seek to further enhance data reliability and consistency across industries and value chains, for instance via the inclusion of a verification and assurance roadmap."
The Securities and Exchange Commission (SEC) in the United States has recently adopted rules to enhance and standardise climate-related disclosures by public companies, which underscores the global momentum towards more consistent and transparent reporting frameworks. This includes the disclosure of material climate-related risks and their impact on business strategy, as well as governance and risk management processes related to climate change). In Europe, the Corporate Sustainability Reporting Directive (CSRD) will require large companies to report their impacts on people and the planet, increasing the transparency of non-financial disclosures.
The Role of ZeroTwentyFifty:
At ZeroTwentyFifty, we are proud to be part of the PACT Ecosystem. Our software solutions are designed to help companies seamlessly integrate with the PACT Network Data Exchange Protocol, enabling them to efficiently measure, manage, and exchange product carbon footprint data. With our expertise in Scope 3 emissions management and our commitment to advancing carbon transparency, we are well-equipped to support businesses in navigating this critical aspect of their sustainability journey.
The PACT Ecosystem represents a significant step forward in the global effort to combat climate change by promoting carbon transparency and collaboration across supply chains. By understanding and engaging with this ecosystem, companies can unlock new opportunities to drive decarbonisation, meet stakeholder expectations, and contribute to a more sustainable future. Stay tuned for future posts, where we'll dive deeper into the components of the PACT Ecosystem and explore how ZeroTwentyFifty's solutions can help your business thrive in this new era of carbon transparency.
If you’ve resonated with this article, I’d really appreciate you sharing this article on whatever platforms you use. Alternatively, you can follow ZeroTwentyFifty or add me on Linkedin. I release all writing on our free newsletter. You can also book a 30 minute no-obligation call with me, to talk about our range of solutions and services.
