Week 5 — Net Zero Pathways & Sustainable Procurement

CVEN 5019 · Integrated Core · Fall 2026 · Week 5

Net Zero Pathways &
Sustainable Procurement

From measurement to strategy — how organizations translate GHG accounting and LCA insights into credible net zero commitments and supply chain transformation.

Instructor Carlo Salvinelli LCA Assignment due end of this week Case discussion analyze a real net zero commitment

Session Overview

Topics

Net zero terminology — carbon neutral vs. net zero vs. carbon negative: important distinctions
Science Based Targets initiative — 1.5°C alignment methodology and validation
Corporate decarbonization roadmaps — abatement curves and priority areas
Carbon offsets — types, quality criteria, and the controversy
Residual emissions — what to do with the unavoidable last 10%
Sustainable Procurement — why Scope 3 Cat 1 is the biggest lever
Supplier engagement — tiering, scorecards, collaborative decarbonization
Circular economy connection — material loops as a procurement strategy
Case study: analyze a real corporate net zero commitment

Learning Objectives

Distinguish net zero, carbon neutral, carbon negative, and climate neutral — and explain why the differences matter
Describe SBTi's requirements for near-term (2030) and long-term (2050) corporate targets
Build a simplified decarbonization roadmap using an abatement curve approach
Evaluate carbon offset quality using additionality, permanence, and leakage criteria
Explain why sustainable procurement is the highest-leverage strategy for most organizations
Design a supplier engagement strategy for a specific Scope 3 hotspot

Getting the Terminology Right — It Matters Legally

Carbon Neutral

Scope 1 + Scope 2 emissions balanced by carbon offsets. Often does not include Scope 3. No mandatory reduction level — can be achieved entirely through offsets. High greenwashing risk.

Net Zero

≥90% absolute reduction in all Scope 1+2+3 emissions from base year + neutralization of residual ≤10% through durable carbon removal. SBTi standard. Much more stringent than "carbon neutral."

Climate Neutral

No net climate impact, accounting for all climate forcers (CO₂, CH₄, N₂O, black carbon, albedo effects). Even more comprehensive than net zero — rarely achieved, often aspirational.

Carbon negative / Climate positive: removing more carbon from the atmosphere than you emit. Current examples: Interface carpets, Climeworks, some forest landowners.
Legal implications: EU Green Claims Directive (2024) and FTC Green Guides (US) now require substantiation for terms like "carbon neutral" and "net zero" — vague claims face enforcement risk

Why this matters for engineers and business students: when your organization makes a public commitment, you need to understand exactly what standard applies — and what the verification burden is
SBTi Corporate Net-Zero Standard (2021) is the most rigorous and widely recognized definition — it is the standard this course uses when discussing "net zero"

Science Based Targets Initiative (SBTi) — 1.5°C Alignment

What SBTi does: provides approved methodologies for companies to set GHG reduction targets aligned with the 1.5°C Paris Agreement pathway, and validates/approves submitted targets
Who's committed: 7,000+ companies globally (as of 2024), including Apple, Amazon, Google, Unilever, PepsiCo — representing $38T in market cap
Near-term target (by 2030): ≥50% absolute reduction in Scope 1+2. Scope 3 must be included if ≥40% of total footprint (nearly always true). Validated against 1.5°C scenarios (Absolute Contraction Approach or Sectoral Decarbonization Approach)
Long-term net zero target (by 2050): ≥90% absolute reduction across all scopes from base year. Residual emissions neutralized by high-quality carbon removal (no nature-based offsets for long-term neutralization in latest guidance)
Validation process: submit target letter + supporting inventory data → SBTi technical review (~6 months) → approved targets publicly listed on SBTi website

SBTi Methods by Sector

Absolute Contraction

Default method for most sectors. Requires same % reduction in absolute emissions regardless of sector. Simple and transparent.

Sectoral Decarbonization Approach (SDA)

Sector-specific pathways (power, cement, iron & steel, pulp & paper, aviation, buildings). Recognizes different decarbonization speeds across sectors.

FLAG Targets

Forest, Land & Agriculture — separate standard for food, beverage, and ag companies whose land-use emissions are material. Includes land-based removal targets.

Financial Institutions

PCAF standard for measuring financed emissions (Cat 15 Scope 3) + SBTi FI standard for setting portfolio decarbonization targets.

Building a Corporate Decarbonization Roadmap

Abatement Curve Approach

Step 1: Identify all emission sources from GHG inventory (Week 2) with their magnitude (tonnes CO₂e/yr)
Step 2: For each source, identify available abatement levers, their technical potential (max % reduction), and marginal abatement cost ($/tonne CO₂e avoided)
Step 3: Build a marginal abatement cost curve (MACC) — rank abatement options from lowest to highest cost, plot cumulative reduction potential
Step 4: Overlay SBTi target requirement — identify the gap between business-as-usual trajectory and required reduction path
Step 5: Assign responsibilities, timelines, capex requirements, and governance mechanisms for each abatement lever

Typical Corporate Abatement Priority Order

~40%Energy efficiency — often negative cost (saves money)

~25%Renewable electricity (Scope 2) — PPAs, on-site solar, RECs

~15%Fleet electrification — vehicles, forklifts, mobile equipment

~10%Process heat decarbonization — heat pumps, green hydrogen

~8%Fugitive emissions (refrigerants, methane leaks)

~2%Residual — addressed by high-quality carbon removal

Carbon Offsets — Quality, Controversy & Appropriate Use

Five Quality Criteria (Gold Standard / Verra)

Additionality: the emission reduction would NOT have occurred without carbon finance — the hardest criterion to verify. Many REDD+ projects fail here.
Permanence: the carbon removal or avoidance is durable. Forest offsets are vulnerable to fire, drought, and policy change — reversal buffers required.
No leakage: avoiding emissions in one location doesn't shift them to another. Protecting one forest must not push logging to an adjacent unprotected forest.
Measurability: emissions reductions can be quantified with sufficient accuracy and verified against a credible baseline
Verified by third party: independent auditor must confirm all criteria are met before credits are issued

High vs. Low Quality Offset Categories

Higher Quality

Direct Air Capture (Climeworks, Carbon Engineering) · Biochar carbon removal (permanently inert) · Enhanced weathering · BECCS · Improved cookstoves with direct monitoring

Quality Concerns

REDD+ avoided deforestation (additionality challenges, Science 2023 study) · Many VCS renewable energy projects in developing countries (baseline manipulation) · Cookstoves without DMRV

Frontier Standards

Puro.earth (engineered removals) · Frontier (advance market commitment for CDR) · CORSIA (aviation sector) · PCAF (financial sector)

Watch Out For

Cheap credits (<$3/t) — quality almost never meets all five criteria at that price. "Certified" does not equal high quality — verify the specific methodology.

Part 2 · Value Chain Strategy

Sustainable Procurement

For most organizations, purchased goods and services (Scope 3 Category 1) represent 50–70% of total GHG footprint. Procurement is not an administrative function — it's a decarbonization lever.

Sustainable Procurement — Why It Dominates

Scope 3 Category 1 (Purchased Goods & Services) is typically the single largest emission source for manufacturing, retail, and food companies — 50–80% of total footprint
Apple (FY2023): 74% of 20 million tonnes CO₂e is in manufacturing of products (supplier operations). Apple's own operations are already near net zero — supply chain is the frontier.
Walmart (Project Gigaton): target to avoid 1 billion tonnes CO₂e from the value chain by 2030. Works with 3,000+ suppliers through its sustainability index and capacity-building programs.
From LCA perspective (Week 4): if your hotspot analysis identified materials or manufacturing as the dominant impact category — sustainable procurement is the direct business response
ISO 20400:2017 — the international standard for sustainable procurement: defines principles (accountability, transparency, respect for stakeholder interests) and how to integrate sustainability into procurement decisions

What Makes Procurement "Sustainable"?

Environmental

Lower GHG footprint, recycled content, no hazardous substances, biodiversity protection, water stewardship in supply chain

Social

Living wages, no forced/child labor, safe working conditions, fair contracting, gender equity, indigenous rights

Circular

Recycled/recyclable materials, design for disassembly, take-back programs, secondary raw material preference

Governance

Supplier code of conduct, due diligence processes, audit programs, Tier 2+ visibility

Supplier Engagement Strategies — Four Tiers

Engagement Approaches (Least to Most Rigorous)

Tier 1 — Awareness: send a supplier sustainability questionnaire (e.g., EcoVadis, CDP Supply Chain). Baseline assessment. Limited buyer accountability. ~30% response rates typical.
Tier 2 — Requirements: include sustainability criteria in supplier scorecards and RFP evaluation. Link performance to contract renewals or payment terms. Supplier code of conduct with audit rights.
Tier 3 — Capacity Building: offer training, tools, and financial support to help suppliers measure and reduce their emissions. Walmart's Project Gigaton, Apple's Clean Energy Program (100% renewable for manufacturing suppliers).
Tier 4 — Collaborative Decarbonization: joint investment in low-carbon technologies shared across supply chain. Co-fund a green hydrogen facility, shared renewable energy PPA, or industrial symbiosis arrangement.

Key Tools and Platforms

EcoVadis

Supplier ESG scoring platform used by 100,000+ suppliers globally. Covers environment, labor & human rights, ethics, sustainable procurement.

CDP Supply Chain

Buyer-driven questionnaire program — 250+ major companies send climate questionnaires to 23,000+ suppliers. Responses feed into Scope 3 Cat 1 inventory.

Sedex / SMETA

Ethical trade auditing platform for labor rights and social conditions in supply chains. Standard for food, retail, apparel sectors.

Science Based Targets for Nature (SBTN)

Emerging framework extending SBTi approach to freshwater, land, biodiversity — increasingly required for full supply chain sustainability.

Circular Economy as a Procurement Strategy

The linear economy problem: Take → Make → Dispose. Each cycle requires virgin materials, generates waste, and produces emissions from extraction and end-of-life processing.
Circular economy: Keep materials at their highest value for as long as possible through reuse, repair, remanufacturing, and recycling (Ellen MacArthur Foundation, 2013)
For procurement: specifying recycled content, taking back products at end of life, and designing for disassembly reduces Scope 3 Cat 1 emissions from the extraction and processing of virgin materials
Steel example: recycled steel (electric arc furnace) emits ~0.4–0.6 t CO₂e/t steel vs. primary steel (blast furnace) at ~1.8–2.0 t CO₂e/t — 65–80% lower emissions, directly reducible through procurement specification

Circular Procurement Strategies

Recycled Content

Specify minimum % post-consumer recycled content in procurement contracts. Drives demand signals that support secondary material markets.

Product-as-a-Service

Buy performance, not ownership. Michelin sells "km delivered," Rolls-Royce sells "thrust-hours" — supplier retains ownership and incentive to extend product life.

Take-Back Programs

Require suppliers to take back end-of-life products for remanufacturing or recycling. Apple Trade-In, HP Planet Partners, Caterpillar Reman.

Design for Disassembly

Specify DfD requirements in product procurement — snap-fit fasteners instead of adhesives, monomaterial construction, visible material marking. Increases recovery rates.

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Week 5 · Case Study Discussion (25 min)

Critically evaluate a real corporate net zero commitment — using the criteria and frameworks from Weeks 2–5.

Choose one company to analyze (materials available on Canvas):
Option A — Apple: "Carbon neutral across entire business, supply chain, and product life cycle by 2030." Analyze their 2023 Environmental Progress Report.
Option B — Unilever: "Net zero emissions across the value chain by 2039." Analyze their Climate Transition Action Plan.
Option C — Amazon: "Net zero carbon by 2040 (The Climate Pledge)." Analyze their 2023 Sustainability Report.

Evaluation framework (cross-disciplinary teams of 4):
1. Terminology check: Is the commitment "net zero" by SBTi definition or something weaker?
2. Scope coverage: Does it include all three scopes? Is Scope 3 Cat 1 addressed?
3. Reduction vs. offset: What % of the target relies on reductions vs. offsets? Are offsets high-quality?
4. Procurement strategy: What supplier engagement mechanisms are in place?
5. Credibility assessment: What's missing? What commitments lack specificity or verification?

Each team presents 2-min summary. Class votes on "most credible commitment."

Key Takeaways — Week 5

"Net zero" has a precise definition (SBTi): ≥90% absolute reduction across all scopes + neutralization of residual emissions. "Carbon neutral" is much weaker and often greenwashing.
Decarbonization roadmaps are built from GHG inventory hotspots — the abatement curve links your Week 2 accounting work to the strategic investment decisions that follow.
Carbon offsets belong at the bottom of the mitigation hierarchy — only for residual emissions after ≥90% absolute reduction. High quality (additionality, permanence, no leakage) is non-negotiable.
Sustainable procurement is the highest-leverage action for most organizations — Scope 3 Cat 1 is 50–80% of most footprints and is directly controllable through buying decisions.

Supplier engagement requires more than questionnaires — Tier 3 (capacity building) and Tier 4 (collaborative decarbonization) are what actually moves the needle in large supply chains.
Circular economy and sustainable procurement are mutually reinforcing — specifying recycled content and circular design directly reduces the extraction and processing emissions that dominate most Scope 3 Cat 1 inventories.
LCA Assignment due this week — make sure your hotspot analysis connects to a concrete procurement or design recommendation.

Next week: Beyond Carbon — Water, Food & Social Systems. Extending the assessment toolkit to the other planetary boundaries. Integration Day — cross-section workshop.