Use Case
Understand climate and ESG exposure across your supply chain
Supply chains are one of the most difficult areas of climate and ESG risk to measure. They are also one of the most important.
For many organisations, material exposure does not sit only inside their own operations. It sits across suppliers, service providers, contractors, distributors, logistics partners and downstream commercial relationships.
This matters because mandatory climate reporting and broader ESG expectations increasingly require organisations to understand indirect exposure, including Scope 3 emissions, supply chain resilience and the climate-related risks that may affect the delivery of goods and services.
The Supply Chain Visibility Problem
Most organisations have some visibility over their direct suppliers. Far fewer have a consistent, data-led view of risk across their full supplier ecosystem. Common challenges include:
This creates a structural blind spot
An organisation may know who it buys from, but not fully understand:
Why This Matters
Supply chain risk is not just an ESG issue. It affects:
The ripple effect
- A supplier exposed to flood, bushfire or extreme weather may create disruption even if the reporting organisation itself is not directly exposed.
- A supplier operating in a high-transition sector may face rising costs, regulatory pressure or changing demand.
- A portfolio of suppliers concentrated in one geography or sector may create systemic exposure that is invisible when each supplier is reviewed individually.
How the NCED Helps
The NCED helps organisations move from supplier lists to supplier intelligence. It can enrich supplier populations with:
This provides a structured view of supplier exposure across the population, not just at an individual supplier level.
Key Workflows
Supplier Baseline Assessment
The NCED can be used to create an initial baseline view of supplier climate and ESG exposure. This allows organisations to understand:
- how many suppliers can be matched
- where suppliers are located
- which sectors they operate in
- which suppliers face higher physical risk
- where data gaps exist
Risk Segmentation
Suppliers can be grouped by risk type, geography, sector or business criticality. This helps procurement and risk teams prioritise engagement and mitigation. For example:
- high physical risk / high spend suppliers
- high transition risk / critical service suppliers
- suppliers in exposed geographies
- suppliers in emissions-intensive sectors
- suppliers with incomplete data requiring follow-up
Concentration Analysis
The NCED can identify whether exposure is concentrated in particular regions, sectors or supplier types. This is important because risk is often not visible at the level of the individual supplier. It becomes visible when viewed across the whole supply chain.
Reporting Support
The NCED can support climate and ESG reporting by providing evidence of how supply chain exposure has been assessed. This is particularly relevant where organisations need to explain indirect exposure, Scope 3 context and supplier-related climate risk.
Practical Outputs
The NCED can help produce:
The Strategic Value
The goal is not simply to label suppliers as high or low risk. The goal is to create a better operating model for supply chain resilience.
The NCED enables organisations to:
- prioritise supplier engagement
- improve procurement decision-making
- reduce reliance on manual questionnaires
- identify hidden concentrations of risk
- support reporting with evidence
- monitor exposure over time
- align procurement, risk and sustainability teams
The NCED helps organisations understand where supply chain risk sits, why it matters, and how it should be prioritised.