Supply Chain Talks with Schneider Electric
Value chains are hot topic. When you know that carbon emissions from the supply chain are on average 11 times higher than what is emitted directly 'on-site', you understand the buzz. We exchanged with Christophe Quiquempoix, Vice President Global Procurement of BACA member and Supply Chain Leader Schneider Electric, about how they engage their suppliers.
Can you tell us about your role at SE, and what energises you in this role?
Christophe: As VP of Sustainable Procurement, I lead various initiatives with our suppliers to fast-track their sustainability efforts. This encompasses the entire ESG spectrum—not just decarbonization—but also environmental actions, social and human rights programs, and internal governance to evaluate ESG performance. I often say I have the best job in the world. With supply chain emissions 33 times greater than our operational emissions, I know I can make a real impact. Driving sustainability isn’t just a responsibility, it’s a duty.
What triggered Schneider Electric to start engaging its suppliers in their decarbonisation trajectory?
Christophe: Schneider Electric has been committed to sustainability for over 20 years. Early on, we realized that focusing only on our operations wasn’t enough, as our supply chain emissions are 33 times larger than those from our 150 factories, 80 distribution centers, and office buildings. To truly decarbonize, we had to engage our suppliers. We began measuring their ESG performance 12 years ago through frameworks like ISO 26000 and Ecovadis, marking our first step in understanding their impact. This effort has since expanded with initiatives like the award-winning Zero Carbon Project.
Can you shed some light on the Zero Carbon Project?
Christophe: The program engages our top suppliers in our sustainability journey. In 2021, we pledged to cut operational emissions of our top 1,000 suppliers by 50% by 2025—a bold move, but crucial for real change. The program has three phases: first, measuring suppliers' carbon emissions; second, encouraging them to set their own targets by 2025, fostering greater ownership; and third, prompting immediate action on energy efficiency, electrification, and renewables. Efficient energy use not only decarbonizes but also reduces costs, helping suppliers gain internal support for these initiatives.
How do you decide which suppliers to target?
Christophe: With 53,000 suppliers, we initially focused the Zero Carbon Project on around 1,000 strategic suppliers. However, after assessing emissions, we found that switching from a strategic to a non-strategic supplier with higher emissions could have a greater impact. This led us to prioritize the top 1,000 suppliers, responsible for about 65% of total supplier emissions. While any supplier is welcome to join the program, we track progress based on those we've actively engaged with.
How do you support your suppliers to reduce their operational emissions?
Christophe: Initial maturity assessments showed that 70% of our suppliers were new to decarbonization, so boosting their knowledge was essential. We launched end-to-end training modules for both beginners and advanced suppliers, followed by specialized sessions on topics like carbon footprint calculation and renewable energy options. Suppliers also access digital tools, including a carbon emission calculator and resources for SMEs.
We offer tailored support, such as one-on-one sessions with sustainable procurement experts who conduct on-site visits, energy audits, and identify quick wins. Bi-monthly community calls allow suppliers to share best practices, fostering healthy competition.
How do you make sure that the various departments at SE are on board with the program?
Christophe: At Schneider Electric, every employee’s bonus is tied to the program’s performance, which is unique and part of our short-term incentive plan. If we aren’t decarbonizing suppliers quickly enough, all departments feel the impact. Leveraging internal expertise is also key—our consultants collaborate with various teams to share knowledge. Additionally, we involve plant personnel in decarbonizing our own industrial operations, ensuring we maintain credibility with our suppliers.
What important challenges did you encounter so far?
Christophe: The initial maturity of our suppliers posed challenges, as the program prompted 720 suppliers to begin decarbonization efforts they might have otherwise delayed. Since not all suppliers share the same urgency on climate change, we shifted from a global to a regional focus, hiring local staff and hosting workshops to offer practical solutions.
Data accuracy is also critical. We've developed tools for anomaly detection and data validation. Instead of auditing all 1,000 suppliers, we require them to publicly commit to their reported data on their website or platforms like CDP, ensuring accountability, transparency, and improved data accuracy.
What is the biggest 'win' of the program so far?
Christophe: At the end of 2023, we measured a 27% average decarbonization intensity among our suppliers, exceeding expectations and showing potential for even greater ambition. I’m also proud of our achievements on the social front. We’ve implemented programs to improve the environmental, social, human rights, and governance practices of our highest-risk suppliers. Knowing that our efforts positively impact not only the planet but also individuals—beyond just numbers and KPIs—brings immense fulfillment.
From a policy perspective, what additional support is needed to help accelerate this transition?
Christophe: Governments too often rely on penalties instead of incentivizing action, such as through tax breaks or loans. Current regulations are often overly complex, especially for the many SMEs we work with. In an Asian pilot, the Green Supply Chain Financing Program, we partner with financial institutions to connect suppliers interested in sustainability investments. Government intervention could simplify these processes—making incentives and simplicity key to driving progress.
What do you recommend companies who wish to start with engaging their suppliers?
Christophe: Set realistic goals for suppliers. Expecting those new to decarbonization to commit to ambitious targets right away isn’t feasible. Instead of imposing a 50% reduction target, we asked suppliers to set their own commitments, fostering ownership and engagement—and the results were better than expected.
My biggest advice: Don’t wait until you have all the answers. New challenges will always arise. We had to adapt as we launched, listening to suppliers and refining our approach.
I also emphasize building industry coalitions with peers and competitors. By uniting efforts, we can drive faster, industry-wide progress.
Thank you, Christophe, for allowing us a glimpse behind the scenes at Schneider Electric!