Shareholders in 2023 are tightly focused on resolutions asking companies to establish science-based greenhouse gas reduction targets that cover the full value chain of emissions—and to report on them. The science is clear that companies need to rapidly act to reduce emissions to limit global warming to a 1.5°C increase in warming.

Investor coalitions have clear expectations for companies. The Climate Action 100+ initiative, a coalition of more than 700 investors with $68 trillion in assets, issued a Net Zero Benchmark to be a key reference; it outlines decarbonization strategies. The benchmark also specifically identifies setting reduction goals for relevant Scope 3 value-chain emissions as essential for corporate climate progress.

Additionally, the Science-Based Targets Initiative defines how companies can define their goals. It explains why goals should aim for at least 4.2 percent year-on-year reductions to achieve approximately half the needed reductions by 2030 from baseline emissions. SBTi companies also must set Scope 3 value-chain reduction targets when these emissions represent a significant portion of total greenhouse gas sources.

Value-chain, also called supply-chain, emissions represent the vast majority of climate impacts for many companies. They include purchased goods and services, the use of sold products and 13 other emissions categories defined by the GHG Protocol. Companies can typically reduce value-chain emissions by designing products with lower lifecycle emissions as well as working with upstream and downstream supply chain partners to reduce carbon.

As You Sow’s 2023 proposals included those filed for the first time at defense companies Lockheed Martin and Raytheon, industrial companies Linde and Mosaic and consumer staples companies Skechers U.S.A and Dollar Tree. While some of these companies have set limited operational emissions reduction goals for Scopes 1 and 2, none has set science-based goals for full Scope 3 value-chain emissions. This leaves many climate-related impacts unaddressed.