How the mood has shifted amid competing priorities and constrained capacity
In the early 2020s, Scope 3 emissions climbed rapidly up the corporate agenda. Sustainability teams finally had the attention of procurement leaders, collaboration increased, and many organizations began making meaningful progress against Board-sponsored sustainability commitments. Baselines were established, suppliers were engaged, and significant effort was invested in understanding supply chain emissions.
Today, the reality is more complex.
Scope 3 has not disappeared from the agenda, but it is no longer the most immediate priority for many organizations. Cost reduction, inflation, resilience, geopolitical uncertainty, regulatory change, and operational performance now compete for the same executive attention and organizational capacity. Teams are being asked to do more with less, and sustainability leaders are increasingly being challenged to demonstrate commercial value alongside environmental impact.
This does not diminish the importance of supply chain decarbonization. If anything, it makes it more important to focus on the initiatives that can genuinely deliver measurable outcomes. Most organizational emissions still sit within the supply base, and procurement continues to control many of the commercial levers required to influence them. Yet, despite years of progress in measurement, reporting, and supplier engagement, emissions reductions have not accelerated at the pace many expected.
The industry has spent much of the last decade building the capability to measure Scope 3 emissions. While those capabilities remain important, measurement is no longer the primary constraint. Most organizations now have a reasonable understanding of where emissions sit and which categories contribute the greatest impact. The challenge is translating ambition into action.
To move forward, we need to reframe the conversation. The barriers to Scope 3 reduction are no longer primarily technical. They are commercial, organizational, and behavioral. By addressing these challenges directly, organizations can move beyond reporting and begin delivering emissions reductions that are commercially viable, operationally achievable, and scalable.
Challenge 1: Decarbonization is struggling to compete for attention
A common perception is that organizations have become less committed to sustainability. In reality, most organizations have not abandoned their ambitions; they are simply facing a growing list of competing priorities.
Procurement functions are being asked to reduce costs, strengthen resilience, manage supplier risk, navigate regulatory requirements, and support growth at the same time. Within that context, sustainability often becomes one priority among many, rather than the dominant agenda item it was expected to become.
The challenge is not convincing people that decarbonization matters. The challenge is helping procurement leaders understand why it matters today, alongside other pressing business objectives. The organizations making the greatest progress are increasingly linking emissions reduction to broader business outcomes such as resilience, efficiency, innovation, and long-term value creation.
Challenge 2: Supplier engagement is not the same as supplier action
Supplier engagement remains one of the most discussed topics in Scope 3 programs, but the definition of engagement needs to evolve. Many organizations continue to measure activity through surveys completed, emissions reported, portal registrations, and sustainability assessments. While these activities provide useful insight, they do not necessarily translate into emissions reductions.
The real test is whether suppliers are changing behavior. Are they investing in lower-carbon manufacturing processes? Are they switching to renewable energy? Are they redesigning products, reducing waste or deploying new technologies? These are the actions that ultimately drive outcomes.
The most successful organizations are becoming far more selective in how they engage suppliers. Rather than treating the entire supply base equally, they focus resources on suppliers, categories, and products with the greatest potential for emissions reduction.
Challenge 3: Procurement lacks the capacity to drive change at scale
A frequently overlooked barrier to progress is organizational capacity. Many sustainable procurement programs assume procurement teams have sufficient time and expertise to engage suppliers, analyze emissions data, redesign category strategies, and monitor outcomes. The reality is often very different.
Most procurement teams are already balancing aggressive savings targets, supply chain disruption, contract renewals, regulatory compliance, and stakeholder demands. Adding significant sustainability responsibilities without providing additional support can create competing priorities and dilute impact.
The issue is not a lack of intent. The issue is that many procurement teams are being asked to deliver more outcomes than their current operating model can realistically support. Organizations must therefore be prepared to focus effort where it matters most, rather than attempting to address every supplier and every category simultaneously.
Challenge 4: Carbon is still not embedded in procurement decisions
Many organizations now include sustainability requirements within sourcing processes and supplier assessments. However, including sustainability in a process is not the same as embedding it within a decision.
A simple question remains relevant:
- When commercial decisions are made, how often does carbon genuinely influence the outcome?
If emissions performance is not reflected in sourcing decisions, category strategies, supplier selection, contract structures, and performance management, it remains a consideration rather than a driver of change. Embedding carbon into procurement decisions requires more than additional reporting. It requires organizations to establish clear trade-off frameworks that enable procurement professionals to balance cost, risk, resilience, and emissions consistently and transparently. Until carbon becomes part of the decision itself, progress will remain limited.
Challenge 5: Suppliers need incentives, not just
expectations
Many supplier decarbonization programs rely heavily on expectations. Suppliers are asked to disclose emissions, establish targets, and develop transition plans. Yet suppliers face many of the same commercial pressures as their customers, including cost inflation, limited capital availability, and uncertain demand.
Expecting suppliers to absorb the cost and risk of decarbonization alone is unlikely to deliver widespread change. If emissions performance is not reflected in sourcing decisions, category strategies, supplier selection, contract structures, and performance management, it remains a consideration rather than a driver of change.
Progress is more likely when organizations create commercial conditions that encourage investment. Longer-term contracts, demand commitments, preferred supplier programs, collaborative innovation, financing mechanisms, and co-investment models can all provide suppliers with greater confidence to invest in emissions reduction. Procurement is uniquely positioned to lead these conversations because it understands both supplier economics and commercial trade-offs.
Challenge 6: Governance and accountability remain
fragmented
Perhaps the most significant challenge is the lack of clarity around accountability. In many organizations, sustainability teams own targets, procurement owns supplier engagement, operations influence demand, and finance controls investment decisions. Each group has a role to play, yet responsibility for delivery is often dispersed across multiple functions.
As a result, important decisions are frequently delayed by competing priorities and unresolved trade-offs. A Scope 3 target is not the same as an operating model.
Organizations that are making progress have established clear governance, clear ownership, and clear decision-making processes. They recognize that emissions reduction must be managed alongside cost, risk, and growth, not in isolation. Without this alignment, progress will remain vulnerable whenever business conditions become more challenging.
The leadership test
The next phase of Scope 3 is not about better reporting. It is about better commercial decisions. The organizations that make meaningful progress will not necessarily have the largest sustainability teams, the most sophisticated technology platforms, or the most detailed emissions datasets. They will be the organizations that embed carbon into everyday procurement decisions, create incentives that encourage supplier investment, and focus their effort where they can deliver measurable outcomes.
The uncomfortable truth is that most organizations already know where their emissions sit. They know which suppliers matter. They know which categories drive impact. The problem is rarely a lack of information. More often, it is a lack of focus, ownership, capacity, or willingness to make difficult trade-offs.
For too long, success has been measured by activity: the number of supplier surveys completed, assessments undertaken, targets published, and reports produced. These activities have value, but they are not outcomes. Emissions are not reduced by measuring them. They are reduced when organizations, procurement teams, and suppliers change behavior.
This is the leadership challenge facing procurement today. Not to create more data. Not to launch another program. Not to introduce another reporting requirement. But to make better decisions. Decisions that balance cost, risk, resilience, growth, and carbon. Decisions that create the commercial conditions for suppliers to invest. Decisions that accelerate action rather than simply improve visibility.
The organizations that succeed will recognize a simple reality:
The race to measure Scope 3 is largely over. The race to reduce it has only just begun. And the winners will not be those who report the most. They will be those who change the most.
