Building a Practical Product Carbon Footprint Program

Across sectors, Scope 3 emissions typically represent 70%-90% of a company’s total footprint (GHG Protocol, 2023), with supply chains often 11-26 times more carbon intensive than direct operations (CDP, 2024). CDP’s latest supply chain report finds that companies ignoring climate risks in their supply chains face costs nearly three times higher than the cost of mitigation, while potential financial gains from supply chain climate opportunities are estimated at around $165 billion (USD). At the same time, according to an EcoVadis and BCG report, unmanaged Scope 3 emissions could translate into more than $500 billion (USD) in annual liabilities by 2030.

Regulation is catching up with this reality. The International Sustainability Standards Board’s (ISSB) (IFRS, 2023) climate standard IFRS S2 requires companies to disclose Scope 1, 2 and 3 emissions in line with the Greenhouse Gas (GHG) Protocol, making value chain emissions mandatory for global capital markets reporting. In the European Union (EU), the Corporate Sustainability Reporting Directive (CSRD) significantly expands the number of companies required to disclose Scope 3, while instruments like the Carbon Border Adjustment Mechanism (CBAM) and the Digital Product Passport are pushing toward product level embedded emissions data, often via product carbon footprints (PCFs).

Despite this pressure, Scope 3 data is still immature. Deloitte’s 2024 Sustainability Action Report finds that while 74% of companies disclose Scope 1 emissions, only around 15% report Scope 3, and 57% cite environmental, social and governance (ESG) data quality as their top challenge. Among the minority that do report Scope 3, nearly two thirds lack confidence in the primary data they receive from supply chain partners, and half point to inconsistent standards and methodologies as a major obstacle.

On the supplier side, maturity is often even lower. CDP’s supply chain analysis shows that only about one in four companies include climate risks related to their supply chain in their risk management processes, and only 15% set targets that explicitly cover their value chain. Deloitte observes that less than 5% of supplier interactions currently contain actual PCF data, with survey response rates often below 30%, and that manual PCF work can take months per product (Deloitte, 2024).

Principle 1: Prioritize and segment — don’t boil the ocean

A practical PCF program starts with ruthless focus. In practical terms, concentrate on the subset of suppliers that drive most emissions or spend, typically 20% of suppliers responsible for about 80% of Scope 3. Focus first on suppliers that represent 80% of spend or expected emissions, combined with a readiness assessment to identify high impact suppliers for direct engagement.

Segmentation should consider not only emissions and spend but also supplier capability and strategic importance. Prioritizing “the right suppliers” and framing requests around the buyer’s own decision making signals that data will actually change purchasing behavior rather than filling a reporting template.

Principle 2: Standardize methodologies to reduce friction

Suppliers are increasingly facing overlapping data requests from different customers, each using slightly different calculation rules. The World Business Council for Sustainable Development’s (WBCSD) Partnership for Carbon Transparency (PACT) (WBCSD, 2025) Methodology Version 3, released in 2025, provides a harmonized framework for calculating cradle to gate PCFs and specifies when recalculation is needed (for example, after process changes affecting emissions by more than 10% or where biogenic content exceeds certain thresholds).

Anchoring your program in GHG Protocol and PACT-aligned rules increases comparability and interoperability, enabling more secure PCF exchange across compliant systems as envisioned by the PACT Network’s technical specifications. It also gives suppliers clear, stable guidelines they can reuse across customers instead of answering bespoke spreadsheets for each buyer.

Principle 3: Phase data requests and raise ambition over time

Given low data maturity, expecting supplier specific PCFs for every product in year one is unrealistic. Leading practice is to phase requests, moving from basic to advanced data over several cycles, each tied to specific business decisions. Advisory support can also help organizations build a business case for carbon action by linking emissions improvements to cost savings, risk reduction, supplier innovation and brand value. The result is not simply emissions reduction to understanding but identifying opportunities to create measurable enterprise value.

• Phase 1: Activity based and hybrid estimates. Start by asking a small cohort of priority suppliers for simple activity data (e.g., energy use, production volumes) and existing Scope 1 and 2 figures, combining these with spend based or industry average emission factors to create hybrid PCFs. This aligns with guidance that spend based methods are a pragmatic starting point when primary data is unavailable, even though they are less precise.
• Phase 2: Supplier specific PCFs for key products. As relationships deepen, move to product level PCFs using standardized methods, focusing on products with material emissions or regulatory exposure (e.g., CBAM covered materials, components affected by Digital Product Passports). It is important to consider that technology platforms can reduce PCF data collection and calculation time by 80%-90%, even down to minutes once production models are set up (Deloitte, 2026).
• Phase 3: Dynamic PCFs integrated into procurement. Over time, PCF moves from a static report to a living dataset embedded in sourcing decisions and supplier scorecards, enabling scenario analysis of material choices and continuous tracking of reductions.

Each phase should be explicitly communicated to suppliers, with clear expectations and lead times — communicating early, avoiding last minute requests and using preferred communication channels are simple steps that can help reduce friction.

Principle 4: Combine support, governance and incentives

Data quality issues are often rooted in capability gaps rather than unwillingness. This is why there is a strong need for investing in structured capability building (such as training suppliers on emissions accounting, sharing practical decarbonization practices and creating peer learning forums) alongside strong program governance and leadership buy in. This is exactly where UL Solutions Enterprise Sustainability Advisory actively supports companies by helping design and implement these capability-building programs, including educating suppliers through workshops and Q&A sessions, offering technical support for calculations and providing targeted resources to identify and act on emission reduction opportunities.

Incentives matter at least as much as training. The use of rewards and penalties, such as financial incentives when agreed emissions targets are met, is a way to align supplier behavior with buyer strategy. EcoVadis and BCG research show that up to 50% of supplier emissions can be reduced cost neutrally, with a third of those reductions achievable for less than USD 12 per tonne of CO₂ equivalent, creating a clear economic case for joint initiatives. Buyers can translate this into tangible benefits: preferred supplier status, longer term contracts or access to co funded efficiency projects for suppliers that provide robust PCF data and deliver reductions.

Governance on the buyer side is equally important. This translates into establishing cross functional oversight that brings together sustainability, procurement, finance and IT so that PCF data flows into sourcing, contracting and performance management rather than staying in a sustainability silo.

Principle 5: Use technology and data exchange to fight survey fatigue

Traditional spreadsheet based surveys are inappropriate to the scale, complexity and frequency of PCF data requirements. Inconsistent data sources and calculation methodologies often lead to significant outliers and errors, undermining overall data reliability. Moreover, static and manually maintained PCFs quickly become outdated and are difficult to integrate with broader corporate carbon accounting, limiting their usefulness for strategic decision-making. This highlights the need for more advanced data management approaches, including digital tracking systems and machine learning-enabled data quality checks, to enhance the accuracy and consistency of Scope 3 emissions data.

Such platforms can reduce PCF data collection time by 80%-90%, shifting the bottleneck away from manual supplier surveys toward intelligent data reuse. ULTRUS® UL 360 software from UL Solutions further enables this transition by centralizing sustainability and carbon data, streamlining supplier data management and supporting consistent PCF calculations. At the same time, sector-level networks also contribute to standardized PCF requests, allowing suppliers to respond once and share across multiple customers rather than managing several bespoke templates, such as the collaboration between Together for Sustainability (TfS) and WBCSD PACT).

For buyers, the key design challenge is to integrate with these ecosystems rather than building additional proprietary questionnaires. This may involve accepting PCFs from different platforms, mapping them into internal systems and focusing resources on interpretation and action rather than data collection. Offerings such as ULTRUS UL 360 support this shift with AI-enabled capabilities that transform supplier-provided emissions data into structured, actionable PCFs. Centralizing inputs and applying consistent methodologies can help companies improve data quality and leverage Scope 3 insights for sourcing and product design decisions.

In conclusion, building a practical PCF program without overwhelming suppliers requires reframing the contractual nature of the relationship. Instead of asking, “How fast can we squeeze PCF data out of our suppliers?” the more strategic is, “How do we design a system where it is in our suppliers’ commercial interest to invest in robust PCFs and low carbon products?” The tools already exist, but they only create value if buyers are willing to change how they allocate business, share savings and measure performance.