Supermarkets Must Leverage Powers of Collaboration, Influence

Empty supermarket shelves may not be the prevailing image associated with the climate crisis, but shoppers around the world are feeling the impacts. Japan is experiencing a “cabbage shock,”, with record temperatures and heavy rains ruining harvests and sending prices three times higher than usual. Elsewhere, cocoa and coffee prices are up 163% and 103%, respectively, compared to 2024, and volatile prices are expected to continue throughout the year as a result of extreme weather. These impacts are unlikely to stop anytime soon. Here in Mexico, the world’s biggest avocado producer, 31% of avocado-growing areas could be lost by 2050, even if global warming is limited below 2C.

By rendering groceries scarce and more expensive, climate change threatens the foundations of supermarket business models: providing a variety of affordable products to consumers. To help the sector strengthen its defenses against climate change and fulfil its responsibilities to reduce its own impact, the Carbon Trust assessed the net-zero plans of the world’s 10 largest supermarkets by revenue. Our recent report, “Big changes in store: how can the global supermarket sector accelerate to Net Zero,” highlights where progress is being made and what supermarkets can do to tackle the remaining challenges.

Encouragingly, all 10 companies have plans in place to reduce emissions from their operations, packaging and food waste. Thanks to high-profile campaigns and emerging legislation, such as the European Regulation on Deforestation-free Products, there is also a high level of ambition to eliminate deforestation – with 8 of the 10 setting targets for deforestation-free soy and palm oil. There are many examples of leading practices, from piloting low-carbon fertilizers to designing store layouts to display sustainable options more prominently to customers. 

However, there remains a significant gap between the sector’s progress to date and the transformational change needed to deliver net zero. We found three areas consistently holding supermarkets back. 

1. Agriculture and land use. Decarbonizing food production, the sector’s biggest source of emissions, is in its very early stages. Just 4 of the 10 supermarkets outline detailed plans to scale sustainable agriculture.

2. Lack of visibility into supply chains. Not only is this a barrier to implementing deforestation-free supply chains, it also means only half of the 10 supermarkets are able to disclose emissions data for the products they buy (60% of their total emissions).

3. The complex topic of customers’ diets. Demand for variety, convenience, and carbon-intensive goods is contributing to emissions and food waste. While all 10 supermarkets are introducing new lower-carbon products, just four have detailed plans for increasing demand for them. 

The good news is that there are plenty of solutions available, many of which rely on supermarkets leveraging their power of influence over suppliers, policymakers, and customers. 

Around 93% of supermarkets’ emissions lie outside of their direct control, within the supply chain. To cut their carbon footprints, supermarkets will therefore need to encourage and enable suppliers to produce goods in a more sustainable way. For example, financial incentives like low-interest loans, early payments, or premium pricing help farmers to invest in climate-smart agricultural practices. 

As well as suppliers, supermarkets’ climate targets are dependent on consumers and policymakers doing their bit. To influence shopping habits, supermarkets can take steps to make sustainable products more accessible, affordable, and attractive to customers. One leading supermarket in our sample has chosen to match the price of several meat products with plant-based alternatives.  

Yet, the systemic challenges the sector faces are too big for any one company to tackle individually. Supermarkets can achieve much more through collaboration. For instance, it is not uncommon for several supermarkets to request emissions data separately from the same supplier. Streamlining this process, including through shared reporting platforms, would reduce time and resources for all. Equally, supermarkets can maximize their influence with policymakers by collectively advocating for policies that would help the sector reach net zero, like support for farmers to transition to regenerative agriculture. The opportunities for greater collaboration are extensive, from co-investing in innovation and infrastructure to tackle carbon-intensive commodities like meat and dairy, to agreeing common supplier expectations to influence food standards.

With climate change already fueling food shortages and record prices, the time for incremental progress toward net zero is over. Although they cannot solve the problem alone, supermarkets are in a unique position to drive change, acting as the touchpoint between millions of customers, food producers, and consumer packaged-goods companies. Coming together to tackle shared challenges and bringing others along on the journey will be essential for supermarkets to pick up the pace on climate action. This may involve some difficult conversations with stakeholders, but it is the only way to protect themselves (and the wider food system) from climate disaster.