EU corporate action as a driver for global emissions abatement: A structural analysis of EU international supply chain carbon dioxide emissions

Global greenhouse gas emissions driven by European consumption increasingly occur outside European borders. These non-European sources of emissions remain linked to Europe via the international supply chains of European companies. Leading companies are now measuring their supply chain emissions and taking tentative steps to reduce them. If such activities were to become widespread, then an opportunity may exist for European industry to drive significant emissions abatement beyond European borders. This paper provides the first analysis into the maximum potential influence European industry has over its non-European supply chain emissions. The analysis is performed at the level of aggregate industry sectors using a global Multi-Regional Input–Output model. The Total Consumption Attribution method is used to estimate the potential influence of different European industries with detailed decompositions carried out using Structural Path Analysis techniques. The potential influence of European industry over non-European supply chain emissions is found to be greater than one gigatonne of carbon dioxide. The European manufacturing sector is found to have the greatest potential influence over non-European emissions via relatively short supply chains that entail few international border crossings. The results presented in this paper provide initial evidence in support of the development of European climate policies aimed at stimulating supply chain emissions reductions activities within European companies