Role of supplier engagement to reduce Scope 3 emissions in circular supply chains

Abstract

Purchasing firms/buyers committed to driving environmental change in their supply chains must address emissions from all three scopes, particularly Scope 3 emissions. Hence, supplier engagement has emerged as a critical strategy for achieving net‐zero emissions. However, studies about how purchasing firms engage with suppliers and how such engagement mitigates Scope 3 emissions are relatively scant. This study fills this important gap in supply chain management literature. The study employs a multiple‐case study approach. Overall, 42 semi‐structured interviews with senior managers from four purchasing and four supplying firms are undertaken. The results unveil six of the best strategies that purchasing firms have deployed to effectively engage suppliers and bring them on track to reduce Scope 3 emissions. These include effective communication, building trust, providing support and guidance, using suppliers' data effectively, refining engagement programs through consistent feedback, and developing supplier incentive programs. The study offers both theoretical insights and practical implications. For instance, it suggests that effective engagement with suppliers will help suppliers mitigate Scope 3 emissions, and buyers can also overcome conflicting targets to reduce Scope 3 emission targets in procurement. The paper concludes with a discussion of limitations and suggestions for future research.