Published on November 16, 2023, 4:07 pm

The Hong Kong and China Gas Company (Towngas) is taking steps to expand the use of the S-Carbon platform in its supply chain management. This initiative 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 within the supply chain. To achieve this, Towngas is deepening its collaboration 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 for quantifying and presenting carbon emission performance.

Through S-Carbon, companies can effectively manage and track their carbon emission reduction goals, as well as monitor the carbon performance of their business partners. The platform identifies the most suitable areas, reference data, and methods for calculating enterprise carbon emissions.

Towngas is leading the way by becoming the first public utility in Asia to implement the S-Carbon platform for supply chain management purposes. The company began a trial run of the system earlier this year. The SGS team, along with its technical experts, will assist Towngas in determining the content and scope of the report for data collection, quantification, and reporting of Towngas’ scope 3 GHG emissions. This system operates on Microsoft Azure, ensuring enterprise-grade security. By utilizing cloud-based data storage and analytics, Towngas can establish a rapid database, access various data sets for management purposes, and compile reports on GHG emissions.

Billy Lai, Deputy Director of Knowledge Solutions at SGS Hong Kong stated that they are delighted that Towngas is leading by being the first public utility to use S-Carbon. This implementation not only improves Towngas’ entire supply chain management but also fulfills their commitment to sustainable development.

In phase one of the S-Carbon platform trial, Towngas is targeting suppliers in Greater China and Japan. These include suppliers of underground pipes, pipe fittings, gas appliances, and more for the company’s Hong Kong operations. Initially covering approximately 20% of the purchase value in the “Raw Materials and Products” category, the signing of an agreement to deepen cooperation will further increase the purchasing value covered to around 90% of this category.

Felix Lee, Head of Corporate Supplies and Administration at Towngas, expressed their commitment to optimizing supply chain management. Previously, Towngas launched an e-Tendering system in 2019 to replace cumbersome processes with an electronic platform, resulting in improved business efficiency and reduced paper consumption. With S-Carbon, they can centrally collect data and analyze it on the platform interface for more accurate and systematic supply chain management. This enhances progress tracking efficiency and enables a comprehensive evaluation of supplier performance.

Implementing S-Carbon not only helps Towngas facilitate data collection on GHG emissions but also improves its overall Environmental, Social, and Governance (ESG) performance. It encourages suppliers to address ESG issues such as climate change and carbon emissions reduction, thereby promoting sustainable development within the industry chain.

The importance of ESG aspects for listed companies is increasing in capital markets. Supply chain management performance and related disclosure requirements are also receiving more attention. Through S-Carbon’s digital management platform, Towngas can collect carbon dioxide equivalent data on GHG emissions from their suppliers. As Cally Chan from Microsoft Hong Kong and Macau emphasized, there is a growing trend to assess corporate ESG performance by considering carbon emissions across various stakeholders within the corporate value chain.

Towngas has been a pioneer in sustainable procurement practices in Hong Kong by completing the ISO 20400 Sustainable Procurement Assessment. By 2021, over 80% and 70% of Towngas’ suppliers have been ISO 14001 and ISO 45001 certified respectively based on the total purchase value of products and materials. This demonstrates the company’s ongoing commitment to responsible supply chain management.

Cally Chan, General Manager of Microsoft Hong Kong and Macau, expressed Microsoft’s dedication to driving and empowering companies in reinforcing sustainability efforts. Microsoft is pleased to partner with Towngas and SGS to support sustainable development by leveraging Microsoft Azure’s scalable, secure, and reliable cloud solution. This collaboration will enhance Towngas’ capability in managing greenhouse gas emissions through the S-Carbon solution. The aim is to encourage more local enterprises in Hong Kong to develop solutions that enhance sustainable development.

In conclusion, the expansion of S-Carbon adoption by Towngas demonstrates their commitment to environmental sustainability and responsible supply chain management. By collaborating with SGS and Microsoft Hong Kong, Towngas aims to drive greater awareness and action regarding GHG emissions within its supply chain while contributing to the future of sustainable development.

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