A new report on corporate climate action highlights that only a small fraction of UK businesses are on track to meet their supply chain (Scope 3) emissions targets, raising concerns about financial risk, regulatory exposure and the broader push to hit net-zero goals. According to the Carbon Action Report 2025, just around 6 % of UK companies are actively progressing toward credible Scope 3 reduction plans, even though indirect, supply-chain emissions often dwarf direct operational emissions.
Scope 3 emissions — those generated outside a company’s own operations, for example through supplier activity, freight transport and product life cycles — can be many times larger than direct emissions and remain a major climate challenge for global supply chains. Despite this, the report found that two-thirds of UK firms are not reporting these supply-chain emissions at all, and only a small minority have formal reduction targets or robust plans to engage suppliers on carbon performance.
Experts behind the study warn that inaction on Scope 3 could expose businesses to significant financial liabilities, particularly as carbon pricing, mandatory climate disclosures and investor expectations tighten. In some scenarios, ignoring supply chain carbon risks could create an estimated US $500 billion in annual liabilities by 2030 for companies globally.
For logistics and supply chain managers, Scope 3 sits at the heart of transport, procurement and warehousing emissions — covering vast emissions from road, air and sea freight, supplier energy use and product distribution footprints. To bridge the gap between aspiration and delivery, the report calls on companies to step up actions such as engaging suppliers in emissions reduction programs, collecting primary emissions data and allocating dedicated resources to climate transition planning.
The findings suggest that while UK firms have made some progress on direct environmental reporting (Scopes 1 and 2), meaningful advances in supply chain carbon management remain slow, underscoring the need for stronger internal systems, clearer targets and closer collaboration across supply networks as regulatory frameworks and investor scrutiny increase.
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