Incentivize Supplier Product Carbon Footprint Disclosure

Tricon is an industry leader in the global trade and distribution of chemicals, operating across complex supply chains.

Transparently measuring scope 3 emissions in global chemical value chains is challenging due to inconsistent data quality, varying supplier maturity and capacity, and still limited, although increasing regulatory requirements.

Tricon recognized the need to improve data transparency to meet internal and external decarbonization goals, including bank KPIs and reporting expectations, supported through sustainability-linked loan facilities by our banking partners.

Tricon developed a structured Supplier PCF Incentive Program offering free consulting and technical assistance, training, verification services, and financial incentives to suppliers willing to calculate and disclose their cradle-to-gate Product Carbon Footprints. Services included:

Figure 1: Incentive Options for Participating Suppliers

Suppliers were encouraged to use the Together for Sustainability (TfS) PCF Guideline to support data transparency and quality. TfS member suppliers were also encouraged to share PCF data through the TfS data exchange platform. When data was submitted in other formats, the Tricon team and/or consultant services helped convert the data into the same format.

Sustainability impact

Climate impact

This initiative addresses Scope 3 emissions as defined by the GHG Protocol, with an emphasis on Category 1: Purchased Goods and Services. Over the 2-year program:

Figure 2: Cumulative Results of the 2-year Supplier Incentive Program

While its main role is facilitative, the initiative provides suppliers with data and resources that may be used to support emissions reduction strategies.

Social impact

Improves access to climate knowledge and resources for suppliers. Reduces barriers to climate participation and supports capacity-building and climate equity in the supply chain.

Business impact

Business benefits

• Provides high-quality Scope 3 emissions data, strengthening climate disclosures

• Supports alignment with KPIs for sustainability-linked financing

• Increases supplier engagement and collaboration on decarbonization

• Enhances ESG credibility with customers, banks, and partners

Costs

Tricon set up a fund internally to invest in the Supplier Incentive Program, as part of our commitment related to our sustainability-linked loans. The budget was based on estimates of how many suppliers would take up the program and the average cost of an incentive, as well as the costs of designing and promoting the program.

The program has successfully met its investment target and completed implementation in line with the objectives of Tricon's sustainability-linked loan facilities. Experience from the program demonstrated that offering a flexible menu of incentives and technical support allows suppliers to engage at different stages of PCF maturity while enabling efficient allocation of program resources.

Co-benefits

Tricon promotes a collaborative approach to environmental sustainability and shared responsibility for climate impacts and solutions. The supplier incentive program is designed to enhance sustainability and increase transparency within the chemical value chain by encouraging collaboration with key suppliers in calculating and disclosing PCF data.

Potential side effects

The main risks relate to limited supplier capacity, confidentiality concerns, and potential misinterpretation of data. Tricon mitigates these by providing targeted incentives, technical support, and ongoing education, while continuing to advocate for better use of data across the chemical value chain. At the same time, Tricon is working to find the right balance on resources to collect data and the need to focus on decarbonization solutions. The company also acknowledges the limitations of data in decision-making to avoid over-reliance on metrics and need to put attention on practical emissions-reduction actions.

Typical business profile

Relevant for companies in high-emissions industries (e.g., chemicals, manufacturing) with significant Scope 3 emissions from purchased goods. Especially suitable for organizations seeking to improve value chain data and support supplier decarbonization in line with Net Zero and ESG financing goals.

Approach

The initiative was coordinated centrally by Tricon’s sustainability team, in collaboration with logistics and commercial functions. Implementation relied on clear eligibility criteria, a menu of service options, and pre-approved providers to streamline enrolment and delivery.

The program followed four main steps:

1. Suppliers reviewed available incentives and selected appropriate options

2. Suppliers enrolled and agreed to share PCF data

3. Tricon provided selected services at no cost to the supplier

4. Suppliers submitted PCF data via SiGreen or Excel, aligned with the Together for Sustainability (TfS) PCF data model

Stakeholders involved

• Project Leads: Tricon Sustainability Team

• Company Functions: Logistics and Commercial Teams, Legal Department, Communications Department

• Main Supplier Providers: ClimeCo, Schneider Electric, Net Zero Solutions

• Tools Used Internally: CarbonChain, Together for Sustainability tools

• Other: Key suppliers invited by volume thresholds and strategic relevance

Key parameters to consider

• Initiative maturity: The Supplier Incentive Program concluded in 2025 and has since evolved into an ongoing supplier engagement process for PCF data collection

• Prerequisites: Internal PCF calculation capability, standardized methodology, supplier engagement strategy, and access to technical expertise to support suppliers with different levels of maturity

• Applicability: Highly replicable across other sectors with complex supply chains

• Key success factors: Relationship-based supplier engagement, flexible support tailored to supplier maturity, standardized data formats, and confidentiality considerations managed via service provider agreements

Implementation and operation tips

Main Challenges

These challenges reflect broader structural and market dynamics associated with voluntary PCF disclosure in complex chemical supply chains:

• Supplier capacity and readiness

• Data quality and methodological differences

• Confidentiality and perceived commercial risk

• Limited regulatory and market drivers

• Internal approval processes within supplier organizations

• Risk of misinterpretations of PCF data

Key Learnings

The program highlighted several factors critical to the success of supplier engagement and PCF disclosure initiatives:

• Targeted multi-channel supplier engagement

• Flexibility in incentive design aligned with supplier maturity

• Sustained relationship-based engagement aligned with supplier timelines

• Standardization and clear guidance to support data confidence and broader adoption

To support responsible use of disclosed PCF data, Tricon contributed to the development of the TfS Guide for Responsible Data Use for PCFs. This industry guidance addresses key areas of learning from the program, particularly around governance, confidentiality, and limitations in “comparability” given the nature of PCF data and life cycle assessment methodologies.

Next Steps:

While the Supplier Incentive Program has formally closed, Tricon remains committed to advancing climate transparency across its value chain. The insights, partnerships, and data generated through the program continue to inform Tricon’s approach to scope 3 emissions transparency and industry collaboration. Following completion of the program, Tricon continues to:

• Collect and integrate supplier-provided primary PCF data to improve data accuracy and increase the share of primary data in customer PCF reports

• Refine modelled PCFs where primary data is not yet available, utilizing secondary databases such as Carbon Minds

• Provide customers with transaction-level and aggregated PCF reports to support product-level emissions transparency

Interested?

Whether you are a supplier interested in sharing primary PCF data or a customer interested in receiving PCF reports, please contact your Tricon commercial representative or the Sustainability team via sustainability@triconenergy.com.