The manufacturing sector is a cornerstone of global economic growth, but it also accounts for nearly 30% of worldwide greenhouse gas emissions, according to the International Energy Agency (IEA)[1]. In Europe, this challenge is amplified by increasingly strict regulations like the Corporate Sustainability Reporting Directive (CSRD) and growing stakeholder expectations on sustainability and transparency.
For manufacturing companies, reducing carbon emissions is no longer a box-ticking exercise. It is a strategic imperative that influences cost efficiency, risk management, reputation, and compliance. The good news? Many emissions reduction strategies align closely with operational excellence and digital transformation.
Here are three practical and high-impact ways manufacturers can reduce their carbon footprint while reinforcing resilience and competitiveness.
1. Switch to Renewable Energy in Operations
Manufacturing facilities often depend on fossil fuels to power machinery, heating systems, and heavy-duty equipment, making energy use one of the largest sources of emissions. Transitioning to clean energy is a powerful first step in lowering your Scope 1 and 2 emissions[2].
How to Take Action
- Audit your current energy use: Identify inefficiencies, peak loads, and high-emission sources across plants.
- Invest in on-site renewable infrastructure: Solar panels, wind turbines, or bioenergy systems can help decentralize and decarbonize your energy mix.
- Source renewable electricity: Secure green energy contracts from certified providers or purchase Guarantees of Origin (GoOs).
Beyond environmental benefits, renewable energy adoption can hedge against fossil fuel volatility and improve brand perception in increasingly ESG-aware markets.
Case Study
To advance its decarbonization goals, Saint-Gobain, a leading manufacturer of building materials in France, signed a 20-year Power Purchase Agreement (PPA) with Boralex in November 2024, securing electricity from two solar farms and one wind farm in France[3]. Starting in 2026–2027, these projects will supply around 110 GWh annually, covering nearly 10% of Saint-Gobain’s electricity needs in France. This move supports the company’s net-zero ambitions while offering multiple strategic benefits:
- Reduced Scope 2 emissions through direct renewable sourcing
- Improved cost stability and resilience to energy market volatility
- Alignment with EU climate goals (e.g., Fit for 55)
- Enhanced ESG profile for stakeholders and investors
This initiative demonstrates how industrial manufacturers can reduce carbon footprints while reinforcing operational and competitive strength.
Governance tip: Platforms like Azeus Convene help sustainability and operations teams track energy KPIs, report progress to the board, and align ESG targets with corporate strategy.
2. Adopt Circular Economy Practices
Reducing waste and improving material efficiency are vital for both emissions and cost reduction. From product design to process engineering, manufacturers can embed circularity into their operations to reduce their overall environmental footprint.
How to Take Action
- Design for reuse and recyclability: Choose modular designs and recyclable materials from the start.
- Use recycled raw materials: Reduce emissions associated with extracting and processing virgin resources[4].
- Minimize production waste: Implement closed-loop systems that reuse offcuts, scraps, and by-products internally.
Circular strategies not only lower emissions, but also future-proof your supply chain against material scarcity and shifting regulations[5].
Case Study
French automaker Renault has emerged as a pioneer in applying circular economy principles within the manufacturing sector. Through its “RE-Factory” initiative in Flins, Renault is transforming a traditional car plant into a circular economy hub focused on refurbishing vehicles, reconditioning parts, repurposing electric vehicle batteries, and recycling materials. This strategy has resulted in substantial resource and emissions savings:
· 77% reduction in industrial waste
· 80% decrease in energy consumption
· 88% reduction in water usage[6]
By designing closed-loop systems that reintegrate materials from end-of-life vehicles into new production lines, Renault not only significantly reduces its carbon footprint, but also increases operational resilience, insulating itself from raw material shortages and price fluctuations. This circular model enhances cost efficiency and aligns with evolving EU regulations and consumer demand for sustainable industrial practices.
Governance tip: Use your ESG platform to centralize tracking of waste reduction targets, supplier circularity certifications, and product life cycle improvements.
3. Decarbonize the Supply Chain
For many manufacturers, the bulk of emissions reside in Scope 3, upstream in the supply chain and downstream in product use and disposal. Engaging your suppliers and logistics partners is essential to any credible decarbonization plan.
How to Take Action
- Map your value chain: Identify carbon hotspots across sourcing, logistics, and outsourced production.
- Work with low-emission suppliers: Prioritize vendors with certified carbon reduction plans and sustainable practices.
- Embed carbon metrics into procurement: Make emissions data a key factor in supplier selection and performance review.
While influencing suppliers requires collaboration and long-term planning, the potential emissions savings, and reputational benefits, are substantial.
Case Study
Schneider Electric, a global leader in energy management and automation, is advancing the decarbonization of its supply chain in line with its net-zero emissions by 2050 ambition[7]. Key elements of its approach include:
- The Zero Carbon Project and Green Materials program, engaging suppliers to reduce emissions through renewable energy adoption and improved energy efficiency.
- A target to reduce Scope 3 emissions related to purchased goods and services by 35% by 2030 compared to 2017 levels.
- Achieved a 10% reduction in upstream emissions in recent years, reflecting decreased commodity use and supplier collaboration[8].
- Use of digital tools and data analytics to monitor emissions and improve transparency across the supply chain.
These measures strengthen Schneider Electric’s supply chain resilience, reduce carbon risk, and improve its competitive position amid growing sustainability demands.
Governance tip: With Azeus Convene, ESG leaders can collect and consolidate Scope 3 data, assign action items, and produce auditable reports aligned with CSRD and global frameworks like ESRS or GRI.
Final Thoughts
Manufacturing leaders are under pressure to decarbonize quickly and credibly, but also have an opportunity to lead the industrial transition to sustainability.
By focusing on:
- Cleaner energy,
- Circular production models, and
- Supply chain engagement,
manufacturers can reduce their environmental footprint while unlocking operational and reputational value.
To make these strategies actionable, manufacturers need a digital foundation for tracking, reporting, and decision-making, one that supports cross-department collaboration.
Azeus Convene empowers manufacturing companies to:
- Track ESG performance across plants and suppliers,
- measure emissions across scopes 1, 2, and 3,
- Generate structured, auditable reports for internal and external stakeholders.
Want to learn more? Then visit www.azeusconvene.com/esg to read about its many useful features and tips on how to reduce your carbon footprint.
[1] International Energy Agency (IEA). Tracking Industry 2023. https://www.iea.org/reports/tracking-industry-2023
[2] McKinsey & Company. How industry can move toward a low-carbon future. https://www.mckinsey.com/business-functions/sustainability/our-insights
[3] E SG Today. (2024, November 16). Saint-Gobain Signs 20-Year Renewable Energy Deal with Boralex for Solar, Wind Power. Retrieved from: https://www.esgtoday.com/saint-gobain-signs-20-year-renewable-energy-deal-with-boralex-for-solar-wind-power/
[4] Ellen MacArthur Foundation. Completing the Picture: How the Circular Economy Tackles Climate Change. https://ellenmacarthurfoundation.org/completing-the-picture
[5] European Commission. Circular economy action plan. https://environment.ec.europa.eu/strategy/circular-economy-action-plan_en
[6] European Circular Economy Stakeholder Platform (ECESP). (2023). Renault’s RE-Factory: Transforming a car plant into a circular economy hub. Retrieved from https://circulareconomy.europa.eu/platform/en/good-practices/renaults-re-factory-transforming-car-plant-circular-economy-hub
[7] Schneider Electric. (2023). 2023 Climate Report. Retrieved from https://www.se.com/ww/en/assets/564/document/466151/2023-climate-report.pdf
[8] Schneider Electric. (2021). Climate Report 2021. Retrieved from https://www.se.com/ww/en/assets/564/document/322981/climate-report-2021.pdf
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