Last month, China announced it would reduce its greenhouse gas emissions by 7 to 10 percent by 2035. A disappointing message, according to many, as it had hoped for more. Yet a turning point: for the first time, the country is setting absolute reduction targets rather than just intensity targets.
Chinese factories are ordered to develop climate transition plans and report to their own government. And the
Why this is important
Scope 3 emissions make up an average of 75 to 92 percent of a company’s total carbon footprint. The Netherlands imported
Currently, the problem is not only the lack of data, but mainly the quality. Suppliers do not respond to questionnaires, or send estimates that cannot be verified. You can report with sector averages-both the CSRD and CSDDD set effort obligationsafter all-buteffectively steering for reduction in Chinese value chains has been very difficult so far.
From one-way traffic to dialogue
This is now changing. China is building a CO2 emissions reporting system to be operational by 2025. Listed Chinese companies must submit sustainability reports starting in 2026. And by 2027, climate-related reporting standards will be introduced for broader groups of companies.
Because of this, soon you won’t just ask for data for your CSRD reporting. You ask: What does your climate plan look like? What reduction targets have you set? What are you up against? How can our ambitions fit together?
As a result, this no longer becomes a pure compliance question, but a strategic conversation between partners who both face similar challenges. Moreover, Chinese factories have to report on you to their government and you have to include the same suppliers in your Scope 3 calculations. This interdependence creates room for collaboration that was previously lacking.
What you can soon do with better supplier data from China
The real problem with bad Scope 3 data is that you can’t steer. With sector averages, you can’t see where the biggest impact is. You can’t prioritize. You don’t know which suppliers are leading and which are lagging.
Chinese suppliers who are now systematically developing emissions data are finally providing useful figures. Not immediately perfect, but substantially better than before. This allows you to:
- Real focal points to be found. Discover that 80% of your product emissions come from three components, rather than working with vague assumptions.
- Suppliers to compare. See which suppliers are already investing in renewable energy and which are still running entirely on coal.
- Redesign products together. Where are the biggest emissions? Which material substitutions yield the most? This used to be speculation; now it is becoming data-driven.
- Demonstrate impact. Convince investors, customers and regulators with concrete numbers rather than vague intentions.
How to get started
Start with your 10-15 largest suppliers. A perfectly transparent value chain is unachievable, a focused approach is.
Change your question wording. Instead of opening with “We need data for compliance,” open with “What climate plan have you submitted? How can our ambitions connect?”
Accept phased improvement that might look like this, for example:
- Year 1: Still working with estimates and industry averages
- Year 2: Use primary data from your top 5 vendors
- Year 3: Expand and work with initial verifications
Document this process: both the CSRD and the CSDDD require this administration. And integrate where possible: the CSDDD also requires due diligence on working conditions starting in 2028. One conversation on ESG performance is more efficient than separate tracks.
Where possible, integrate due diligence on working conditions. The CSDDD requires companies to monitor human rights and labor conditions in supply chains. With Chinese suppliers, this becomes no easy question: labor standards differ fundamentally from European standards, with longer working hours and limited union rights. This makes it an ongoing challenge that requires mutual understanding, but discuss climate goals and labor conditions in one conversation rather than through separate questionnaires.
Start now
Building reliable Scope 3 data takes time. Trust relationships develop gradually, systems must be aligned, and data exchange requires mutual understanding.
Companies that start early build valuable experience. For example, you learn which suppliers are open to collaboration and develop working relationships that truly enable shared reduction goals.
China’s climate goals offer a concrete opening. Take advantage of it.