Additional Guidance: Reporting to CDP as a Walmart Supplier Contents Walmart’s Supply Chain Sustainability Commitments ............................................. 1 How can your company help Walmart achieve its goals? ........................................ 2 What are the benefits for your company? .............................................................2-3 How do you attribute your emission reductions to Walmart (SM2.2)? ...................3-5 How do you allocate your emissions to Walmart (SM1.1)? ...................................5-6 Extra guidance & support for the CDP Supply Chain request: ................................. 6 Walmart’s Supply Chain Sustainability Commitments: 1. Eliminate 20 million metric tons (20 MMT) of greenhouse gas (GHG) emissions from their global supply chain by the end of 2015. 2. Develop a worldwide sustainable product index. Walmart’s 2015 CDP Supply Chain request: Addressing our carbon footprint is critical for us. The infrastructure of CDP allows us to do something that at first seemed very challenging. While we work to improve our own operations, we know we have responsibility in our supply chain… We want to say a special thank you to our supplier partners who have reported to CDP through this request. And for those of you who haven’t reported yet, we encourage you to start on this journey with us. Manuel Gómez Peña Vice President, Sustainability Watch Video: @cdp | www.cdp.net | respond@cdp.net | P a g e 1 How can your company help Walmart achieve its goals? Walmart estimates that over 90% of their overall GHG footprint resides with their suppliers. Walmart has already made significant progress towards their own corporate GHG reduction goals; in order to have the most impact they are looking to their most important business partners – you – to collaborate on win-win sustainability innovation opportunities throughout their supply chain. To demonstrate your commitment, CDP and Walmart encourage you to complete all parts of the CDP questionnaire in order to share your overall strategy and actions to measure, manage and reduce your greenhouse gas emissions and climate change risk exposure. As a critical supplier to Walmart you can play an important part in helping achieve its goals by focusing on the following questions in CDP’s 2015 Supply Chain questionnaire: CDP question CC8.2 and CC8.3 Topic Measure your Scope 1 & 2 GHG emissions CC3.1 and CC3.3 Set a GHG reduction target and show progress SM2.2 Attribute emissions reductions to Walmart’s 20 MMT reduction goal SM1.1 Allocate your GHG footprint to Walmart SM2.1 Suggest collaborative opportunities to Walmart Reason Know your GHG footprint and develop an understanding of where efficiencies can be found Show ambition to reduce your GHG footprint and implement emissions reduction activities Contribute completed emissions reduction projects to Walmart’s goal. Every ton that has been influenced by Walmart can count (see page 3) Tell Walmart what part of your emissions are due to the goods/services that they purchase from you. Walmart uses this number to calculate the magnitude of their upstream Scope 3 GHG footprint for their own CDP disclosure (see page 5) Offer new ideas of how you can partner with Walmart to further reduce emissions in the future What are the benefits for your company? Find cost savings by reducing emissions: As reported in Walmart’s Global Responsibility Report, “In 2014, more than 700 suppliers submitted responses to our request. Of those, 68 percent reported more than 1,900 greenhouse gas emission-reduction activities.” Many of these companies have already recouped their investment by now and will save money this and every year going forward. Be recognized by buyers and merchant leaders: You will be contributing to Walmart’s ambitions: “We are excited about the difference we can make when we lead on the big issues together” says Manuel Gómez Peña, Vice President, Sustainability, “Measuring and reducing greenhouse @cdp | www.cdp.net | respond@cdp.net | P a g e 2 gas emissions will make a significant difference for customers and communities around the world, and it will make us a stronger and more competitive businesses.” Develop new business with Walmart: CDP’s questionnaire now allows you to communicate any proposals you would like to make to Walmart for the collaborative development of new GHG emission reducing projects or products. They state that “all suggestions reported through SM 2.1 will be reviewed and considered by Walmart. We encourage you to share your innovative ideas with us.” You’ve reduced your emissions as a company in part or wholly due to the request from Walmart to help them meet their goal of 20 MMT of supply chain greenhouse gas emissions. How do you report corporate or facility-level emissions reductions through CDP question SM2.2? Question SM2.2: How to attribute your company’s emission reductions to Walmart If you have undertaken any emissions reductions at a corporate or facility-level for which Walmart engagement or interest was wholly or partially responsible, please report them in this question. Here’s how: 1. Navigate to question SM2: Supply Chain – Collaboration using the navigation headings in the CDP online response system. 2. Select “yes” from the drop down menu provided for SM2.2 “Have requests or initiatives by CDP Supply Chain members prompted your company to take organizational-level emissions reduction initiatives?” @cdp | www.cdp.net | respond@cdp.net | P a g e 3 3. This will populate a follow up question SM 2.2a “Please select the requesting member(s) that have driven a reduction”. This is your opportunity to associate your emissions reductions with Walmart’s 20 MMT goal. Select Walmart as the requesting member and fill out the rest of the information in the table. It is important to include a quantity of emissions reduced in metric tonnes of CO2e in the fourth column. Walmart SM 2.2a Please select the requesting member(s) that have driven a reduction This question only appears if “Yes” is selected in response to question SM 2.2. Please select the requesting member(s) that have driven a reduction Initiative ID Describe initiative the reduction Give reduction for the reporting year in metric tonnes of CO2e A text answer of up to 2,500 characters. Will accept a number up to and including 1000000000. Will not accept decimal places. Enter the number without punctuation. Requesting Customer 2015- ID1 Ex: Walmart 2015- ID2 Ex: Walmart Ex: Following engagement with Walmart we calculated our corporate emissions for the first time. This process helped us to identify energy efficiency initiatives in our buildings. This included HVAC and lighting refits, which reduced our emissions and paid back costs in under a year. Ex: Walmart, as one of our customers, plays an important role in every business case we make for Ex: 232 Ex: 59000 @cdp | www.cdp.net | respond@cdp.net | P a g e 4 investing in emissions reductions. Demonstrating that we are an efficient and reliable partner is core to our climate change work. Last year we installed a biomass boiler at our Smithtown manufacturing plant. The emissions saved are based on a comparison to previous years. Please note: 1. This table is designed so that only the customer that you select in column 1 will be able to see the data relevant to them. If you enter an answer without selecting a requesting member, your answer will not be viewable at all. In this case, please select “Walmart;” if their name isn’t there email respond@cdp.net and we will add it in for you. 2. Please describe one initiative per member per line in this section – including the quantity of emissions saved – and how it relates to that member (i.e. Walmart). There are many ways of associating emissions to a member – it is not asking you to allocate emissions reduction; just provide the link / causality between the emissions reduction number and the requesting member. You can find examples above. Question SM3.2: How to attribute your product-level emission reductions to Walmart If you have undertaken any emissions reductions at a product-level for which Walmart engagement or interest was wholly or partially responsible, please contact respond@cdp.net for further guidance. You’ve measured and reported your emissions. Now you can help Walmart better calculate their own Scope 3 by allocating your emissions to them. How do you allocate your emissions to Walmart through CDP question SM1.1? Question SM1.1: How to allocate your company wide emissions to Walmart Emissions from suppliers are often greater than the purchasing organization’s own emissions and Walmart is no exception. To better understand the carbon footprint in their supply chain, Walmart has been calculating part of their Scope 3 emissions inventory by using data in SM1.1. In this question you are asked to allocate your Scope 1, Scope 2, and if possible your Scope 3 emissions to Walmart. @cdp | www.cdp.net | respond@cdp.net | P a g e 5 Scope 1 Scope 2 Scope 3 There are various different types of allocation methods, which will assist in calculating which of your emissions Walmart were responsible for. You are encouraged to review the various allocation methods set out by the GHG Protocol Scope 3 Standard (Chapter 8). The most common allocation CDP has seen suppliers use has been either through the proportion of sales revenue that Walmart are responsible for, or by mass of products purchased. CDP also provide guidance on allocating emissions through the Supplier module for your reference. Extra Guidance & Support for the CDP Supply Chain Request: Help and Guidance tools and documents to help you register and navigate through the CDP online response system Guidance help page includes detailed guidance documents including: o The Climate Change guidance document for questions CC1-CC15 o The Supplier module guidance document for questions SM1-SM3 o Using the Online Response System (ORS): How to activate, log in, and navigate the CDP questionnaire. Also available to as a recorded webinar (watch on Vimeo) Additional guidance includes: o How to Respond and Submit as a SME: Step-by-step guide to using the online response system as a small/medium-sized enterprise. o How to respond and submit if you are already disclosing under the Investor Climate Change program: Step-by-step guide to completing the additional 3-question Supplier module o Guidance for First Time Responders: A document to help new responders submit information to CDP o Supply Chain Reporting Roadmap 2015: A guide to help responders to move from a basic response towards complete disclosure Any further problems or questions? Please contact us via respond@cdp.net @cdp | www.cdp.net | respond@cdp.net | P a g e 6