Amazon may impose new requirements on sellers

As Amazon and other giants begin to step up efforts to reduce their carbon footprint, they have decided to turn their attention to suppliers and ask them to follow suit , and those suppliers and sellers who fail to meet the requirements may be cleared out .

E-commerce giant Amazon said in its recently released sustainability report that starting in 2024, it will require suppliers to share their emissions data, set emissions targets, and report on their progress.

" Big companies are under pressure from the outside world , and then they pass it on to their suppliers , " said Bob Willard, a business consultant .

Generally speaking, companies tend to track carbon emissions from three sources . The first comes directly from operations. The second comes from purchased energy, such as electricity . The third involves a company's indirect activities , such as carbon emissions generated by suppliers and customers who use its products .

Analysis of major industries by the nonprofit CDP found that, on average, the third category accounted for about 75% of all emissions .

Compared to many other indirect emissions, companies have far more control over suppliers : a consumer goods company , for example, ca n’t force detergent buyers to wash in cold water, but it can choose to work with environmentally conscious suppliers .

Amazon has already begun forcing suppliers to report their carbon emissions to them and set targets, as many other companies have done .

“We know that to further reduce our carbon emissions, we must ensure those companies in our supply chain make the necessary changes, ” Amazon said in its sustainability report.

Third-party sellers and suppliers — especially smaller ones — are facing a paradox in that even if they are environmentally conscious, many say they don’t have the resources to meet that demand.

According to a survey, 80% of small and medium-sized business owners said reducing emissions was a priority, but 63% said they did not have the right skills and 43% said they lacked funding.

Amid ongoing concerns about a recession, surging interest rates , weak consumer demand and labor market challenges, small and medium-sized businesses are already struggling to survive, let alone protect the environment.

When asked what issues were most important to them, nearly 40% said jobs and the economy, while just 10% named the environment, according to SurveyMonkey 's third -quarter small business survey.

Amazon said in its sustainability report that it will use its scale, investment and innovation to provide suppliers with products and tools to help them achieve their carbon reduction goals.

But the retail giant also made clear that partners who don’t meet the standards could face consequences. “As we select partners, we will continue to seek out suppliers and sellers who can help us achieve our decarbonization vision,” Amazon said in its report.

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