The idiom that ‘you don’t manage what you don’t measure’ holds when it comes to greenhouse gas emissions and climate-related risk.
It’s the responsible thing to do to take steps to understand the sustainability – and challenges – associated with your supply chain; and that’s especially true when you’re the Federal Government and that supply chain exceeds $400 billion per year.
Today’s action does just that.
Today the Federal Acquisition Regulatory Council proposed for public comment a rule that would drive greater disclosure in the Federal Government’s supply chain to indicate if and where contractors and vendors publicly disclose greenhouse gas emissions, greenhouse gas reduction goals or targets, and climate-related risks—such as physical risks to operations associated with extreme weather events. The proposed rule puts even more focus on how we manage the Federal Government’s supply chain and the data we need to do that responsibly, and it leverages the Federal Government’s purchasing power to push for this type of unprecedented disclosure Government-wide.
By understanding where larger contractors and vendors that sell goods and services to the Federal Government disclose this information, we’ll be able to better assess supplier greenhouse gas management practices, manage direct and indirect greenhouse gas emission, address climate-risk in the Federal Government’s supply chain, and engage with contractors to reduce supply chain emissions.
Already, individual Federal agencies have started to manage their supply chains in this way. For example, just last month, the Department of Navy requested that its 100 largest suppliers disclose their greenhouse gas emissions and strategies for cutting them. And in 2014, the U.S. General Services Administration factored in greenhouse gas intensity (paired with estimated damages from those emissions) to make multi-million dollar contract awards for domestic delivery services for both air and ground shipments.
There are significant existing demand drivers for disclosure of greenhouse gas emissions and climate-related risk data, including growing calls from investors, insurers, and institutions like the Financial Stability Board. Today’s announcement sends another clear market signal that there is strong interest for disclosure of greenhouse gas emissions and climate-related risk data government-wide.
Anne Rung is the U.S. Chief Acquisition Officer.
Ali Zaidi is the Associate Director for Natural Resources, Energy, and Science at the Office of Management and Budget.
Christine Harada is the Federal Chief Sustainability Officer at the Council on Environmental Quality.