Delivering on the European Green Deal A Private Sector Perspective 2025

Substantial reductions in Scope 1 and 2 emissions can be observed for the analysed companies across Europe; yet Scope 3 emissions remain stable. Between 2019 and 2022, the share of companies that conduct supply chain audits increased slightly from 35% to 38%. The share of companies that use environmental criteria in supplier selection, however, dropped from 47% to 34% over the same period.48 Surveyed companies highlight two main obstacles in decarbonizing their supply chains: a lack of unified internationally respected regulations, and a lack of quality supplier data, while the cost of decarbonization comes in third.49 This finding is reconfirmed by interviews conducted with executives, who also pointed to the fact that in some regions there has been little progress in adopting and adhering to European standards. This suggests that the effective management of Scope 3 emissions requires coordinated action across global supply chains. In the absence of alignment with global standards, this can create disadvantages for European companies, who will struggle with higher costs when competing in markets outside of the EU.50 Without clear global consensus, it is unsurprising that over two-thirds of the surveyed companies do not make any efforts to help suppliers in acquiring the skills needed for the net zero transition.511.4 Supply chains EU support for supply chain partners through the Global Gateway programme BOX 2 The EU’s Global Gateway programme aims to mobilize €300 billion in infrastructure investments from 2021 to 2027, focusing on sustainable, climate-resilient and secure projects in digital, energy, health and transport sectors. It is an important tool to help bring EU supply chains along in the green transition. The initiative emphasizes transparency, good governance and equal partnerships with developing regions. It seeks to strengthen global supply chains through secure, high-quality infrastructure, in close collaboration with the private sector to help catalyse investments.52 With both CBAM (Carbon Border Adjustment Mechanism)53 and CSDDD (Corporate Sustainability Due Diligence Directive)54 coming into force in 2026, executives point to the responsibility of larger companies in their supply chains55 and propose that larger companies provide the necessary tools, finance, and inspiration to their suppliers and smaller companies along their supply chains to decarbonize.56 Additionally, executives invite the public sector to support the establishment of a centralized solution for environmental reporting.57 This can be supported by the private sector through expertise and innovative technology.58 A centralized solution would be especially favourable for small- and medium-sized enterprises (SMEs).59 Between 2019 and 2022, the share of companies that conduct supply chain audits increased slightly from 35% to 38%. 11 Delivering on the European Green Deal: A Private Sector Perspective