Capgemini: Digital Supply Chains Cut Costs and Emissions

With rising greenhouse gas emissions threatening to derail global climate targets and uncertainty mounting from political tensions and cost pressures, supply chains sit at the centre of a growing storm.

According to Capgemini's Building Sustainable Value Chains report, the industrial sector alone contributes over 35% of global greenhouse gas (GHG) emissions. Most of this, around 70%, stems from Scope 3 emissions, which are those that come from the wider value chain including suppliers and customers.

Capgemini warns that unless action is taken, emissions could push global temperatures up by between 4.1°C and 4.8°C by 2100. This far overshoots the Paris Agreement goal of keeping the increase below 2°C, ideally 1.5°C.

Yet, there’s opportunity in the challenge. Sustainable transformation offers cost reduction, resilience to disruption and long-term competitiveness - and for businesses looking to protect themselves from market shocks, getting supply chains in order may be the most effective place to start.

Supply chains and the problem with Scope 3

Decarbonisation, especially of Scope 3 emissions, proves to be a persistent stumbling block.

Half of the businesses Capgemini surveyed admit they are off-track in addressing Scope 3. Two-thirds say they lack confidence in delivering a fully developed roadmap.

Why? Because measuring and managing emissions beyond a company’s own operations is complex and resource-intensive.

There are several hurdles; businesses struggle to build a clear case for long-term investment in sustainability. Tracking and reporting emissions across suppliers remains patchy.

Supply chains, especially across multiple geographies, are difficult to decarbonise. Low-carbon technologies, meanwhile, are often hard to scale.

Different sectors also face different pressures. Industries such as steel, cement and mining see most of their emissions in Scope 1, which covers direct emissions from owned or controlled sources. But in electronics, food and chemicals, the bulk lies in Scope 3. This means decarbonising requires coordination between manufacturers, suppliers and retailers.

“Building a sustainable value chain is an iterative process,” say Cyril Garcia, Group Executive Board Member and Head of Sustainability at Capgemini and Charlotte Pierron-Perlès, Global Head of Intelligent Industry, Capgemini Invent, in the report.

“It requires a balanced approach between short-term quick wins, such as energy efficiency and sustainable product design improvements and long-term action, such as strategising on the product portfolio, sustainable asset investment and supply chain re-design.”

Less emissions, more efficiency

Despite the barriers, Capgemini sets out a clear business case. Sustainable supply chains don’t just reduce emissions—they also cut costs and increase efficiency.

The report includes a number of examples. One packaging company redesigned its product using life-cycle assessment, lowering the carbon footprint per unit from 10 kgCO₂e to 3 kgCO₂e. At the same time, it managed to reduce production costs. A car manufacturer brought down Scope 1 emissions by 27% and Scope 2 by 13% across 17 sites.

Circular models prove especially powerful. In water and automotive sectors, circular systems yield material savings of up to 50% and cost reductions as high as 70%.

A heavy industry client uses digital twins, virtual replicas of physical processes, alongside AI to cut kiln energy use by 15% and shorten development cycles by 70%.

These aren’t isolated wins. They point to the kind of measurable impact businesses can achieve when sustainability is embedded across operations and supply chains.

Supply chain transformation

To achieve this kind of shift, Capgemini proposes a three-pillar framework: sustainable product design, sustainable manufacturing and sustainable supply chains. The third pillar - supply chains - is especially crucial, as it deals directly with logistics, procurement and supplier relationships.

Under this model, businesses prioritise responsible sourcing, logistics optimisation and ESG transparency. These steps reduce dependency on vulnerable resources and prepare businesses for disruption.

Capgemini highlights “transversal enablers” that support all three pillars. These include traceability tools, digital product passports and automated systems to evaluate carbon footprints across extensive product catalogues.

Digitalisation plays a critical role here. Data systems, digital twins and AI offer predictive modelling, real-time decision-making and enhanced traceability.

For example, one manufacturer with 8,000 suppliers and 350,000 product references uses an automated carbon footprint system to map out a complete decarbonisation roadmap.

“Digital transformation and AI are a formidable opportunity to get faster and improve decision-making throughout this transformation, as they help achieve better designs, more productive assets and more flexible supply chains,” say Cyril and Charlotte.

Ultimately, supply chain sustainability is more than a compliance exercise. Capgemini positions it as a growth strategy. Businesses that embrace circularity, digital tools and supplier collaboration are better equipped to manage risks and build long-term resilience.

As climate risk intensifies and economic volatility grows, companies with transparent, low-carbon and digitally enabled supply chains are not just reducing their environmental impact—they are setting themselves up to win.