52% of Telia’s supply chain emissions are covered by science-based targets

To contribute to the battle against climate change, Telia’s overall net-zero target is to achieve net-zero greenhouse gas emissions across its value chain – in other words, all of the steps in the process of taking products and services all the way from conception to delivery to its customers – by 2040. Most of Telia’s total value chain emissions, an estimated 87%, are generated in its supply chain – the network of individuals, businesses and resources involved in the production and delivery of Telia’s products and services. This includes purchases related to network construction and maintenance, network equipment, mobile phones and other hardware, as well as other goods and services. By comparison, only 1% of Telia’s emissions are generated by its own operations. Therefore, the key to Telia achieving its overall net-zero target is selecting suppliers that are able to reduce their emissions.

In its procurement processes, Telia assesses suppliers’ climate management maturity so that it can reward the best performers and influence those suppliers that still have more work to do. The company’s Supplier Code of Conduct, which outlines its expectations for the ethical and responsible behavior of its suppliers, includes a requirement that suppliers should set verified science-based targets. Telia continuously engages with its suppliers, urging them to set these targets. By the end of 2023, suppliers responsible for 52% – versus 35% at the end of 2022 and 27% at the end of 2021 – of Telia’s total supply chain emissions from purchased goods and services and capital goods were covered by such targets. Suppliers responsible for an additional 11% of these emissions have committed to setting science-based targets within two years. Telia’s goal is for 72% of its total supply chain emissions from purchased goods and services and capital goods to be covered by science-based targets by 2025. Progress towards Telia’s 2025 supply chain climate target has been one of the assessment factors included in the Long-Term Incentive variable pay program for the company’s Extended Leadership Team since 2022.

In 2023, as part of its work on advancing circularity – a topic that will be covered in an upcoming article – within its own operations and reducing greenhouse gas emissions, Telia initiated a supplier engagement project with network equipment vendors to align on the requirements of the European Sustainability Reporting Standard E5. European Sustainability Reporting Standard E5 is one of a set of standards introduced by the European Union (EU) to increase transparency and consistency in corporate sustainability reporting. The purpose of this project was to help suppliers limit their resource use and increase their circularity efforts, as well as to ensure their readiness to meet related requirements from the Corporate Sustainability Reporting Directive introduced by the EU to increase transparency and standardize how companies disclose their environmental and social impact.

The latest assessment of the indirect greenhouse gas emissions that occur throughout Telia’s value chain, but outside of its own operations and energy purchases, revealed a 6% decrease compared to the base year (2018). The decrease is mostly due to changes in the environmentally extended input-output factors (EEIOs) used to assess the impact of economic activities throughout a supply chain. To date, when calculating its supply-chain emissions, Telia has largely depended on calculations based on EEIOs, which makes it difficult to track emission reductions resulting from the company’s selection of suppliers and the actions taken by these suppliers. Telia therefore aims to incorporate a higher share of supplier- and product-level data in its calculations in the coming years, as its suppliers increase their ability to report the required data. Telia has also joined forces with companies such as Ericsson, IKEA and Unilever in the 1.5°C Supply Chain Leaders initiative to provide support to suppliers in both target setting and reporting via the Supplier Engagement Guide and, for suppliers with fewer resources, the SME Climate Hub.

To learn more about this and related topics, see Telia’s 2023 Annual and Sustainability Report and read about the company’s approach to responsible sourcing.

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