Published on November 9, 2023, 6:05 am

The Hong Kong and China Gas Company (Towngas) is taking steps to enhance their supply chain management by expanding the use of the S-Carbon platform. This move aims to encourage more suppliers to understand and report on greenhouse gas (GHG) emissions while improving the integrated reporting process of digital GHG emissions data in the supply chain. To achieve this, Towngas is collaborating with SGS and Microsoft Hong Kong.

SGS has developed the S-Carbon digital carbon management platform on Microsoft Azure. This platform utilizes GHG emissions accounting and verification solutions, as well as a greenhouse gases emissions data management system. It adopts an internationally recognized method to quantify and present carbon emission performance.

The S-Carbon platform facilitates the calculation of enterprise carbon emissions by identifying suitable areas, reference data, and methods. With this tool, companies can effectively manage and track their established carbon emission reduction goals, along with monitoring the carbon performance of their business partners.

Towngas takes pride in being at the forefront of this initiative. As the first public utility in Asia to utilize S-Carbon for supply chain management purposes, they conducted a trial run earlier this year. The development of S-Carbon was led by the technical experts at SGS who assisted in determining the content and scope of reports to facilitate data collection, quantification, and reporting of Towngas’ scope 3 GHG emissions. In addition, Microsoft Azure ensures that the system operates securely with enterprise-grade security measures in place.

By using cloud-based storage and analytics embedded in Microsoft Azure, Towngas has access to a wide range of data sets for efficient management purposes. This enables them to establish a rapid database and compile reports on GHG emissions promptly.

Billy Lai, deputy director of Knowledge Solutions of SGS Hong Kong stated that “We are delighted that Towngas is the first public utility to use S-Carbon,” adding that it not only improves supply chain management but also aligns with Towngas’ commitment to sustainable development.

In the trial phase, Towngas focused on suppliers in Greater China and Japan. This included suppliers of underground pipes, pipe fittings, and gas appliances for their Hong Kong operations, which accounted for approximately 20% of the purchase value in the “Raw Materials and Products” category. With the agreement on deepening cooperation with SGS and Microsoft Hong Kong, it is expected that the purchasing value covered will increase to roughly 90% of this category.

Felix Lee, Head of Corporate Supplies and Administration at Towngas emphasized their commitment to optimizing supply chain management. He mentioned their previous implementation of an e-Tendering system in 2019 to enhance business efficiency and reduce paper consumption. Now, with S-Carbon, they can centralize data collection and analyze it on the platform interface for more accurate and systematic supply chain management. This enables them to track progress efficiently and evaluate supplier performance comprehensively.

The adoption of S-Carbon not only helps Towngas improve its overall ESG (Environmental, Social, and Governance) performance but also encourages suppliers to address ESG issues such as climate change and carbon emissions reduction. It plays a pivotal role in steering the industry towards sustainable development.

ESG aspects are gaining increasing attention from capital markets, including supply chain management performance and related disclosure requirements. Through S-Carbon’s digital management platform, Towngas can collect carbon dioxide equivalent data on GHG emissions from their suppliers.

Towngas was also recognized as the first public utility in Hong Kong to complete the ISO 20400 Sustainable Procurement Assessment. By 2021, over 80% and 70% of their suppliers have been ISO 14001 and ISO 45001 certified respectively, showcasing their dedication to responsible supply chain management.

Cally Chan, General Manager of Microsoft Hong Kong and Macau expressed Microsoft’s commitment to driving sustainability efforts by empowering companies like Towngas. She highlighted the partnership between Towngas, SGS, and Microsoft to support sustainable development. Using Microsoft Azure, they enhance Towngas’ capability in managing greenhouse gas emissions and hope to inspire more local enterprises to develop solutions that contribute to sustainable development in Hong Kong.

This collaboration between Towngas, SGS, and Microsoft Hong Kong demonstrates a groundbreaking approach towards supply chain management through the adoption of the S-Carbon platform. By leveraging digital technologies and internationally recognized methodologies, they are championing sustainability in their operations and encouraging suppliers to embrace environmentally conscious practices.

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