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Carbon Reporting for the Missing Middle: How Medium-Sized Companies Can Navigate Supply Chain Pressure Without Breaking the Bank
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In this practical and reassuring episode of Straight Talking Sustainability, host Emma Burlow reconnects with long-time colleague Kirsteen Harrison from Not Sustainable to tackle the carbon reporting challenges facing what they call "the missing middle" (companies with 250 to 1,000 employees).
These businesses face intense supply chain pressure to report emissions but often lack the dedicated sustainability teams and resources of larger corporations, creating a perfect storm of fear, confusion, and questionnaire paralysis.
Kirsteen brings over 20 years of experience working with SMEs and medium-sized businesses on waste, energy, compliance, and carbon reporting. She reveals a troubling pattern: companies receiving generic carbon reporting requests from larger clients that ask the wrong questions, demand inappropriate data, or require commitments to frameworks (like the Science Based Targets initiative) that were not designed for their size or sector.
The result is fear-driven inaction, with some companies ignoring requests for years until contracts face risk.
The conversation exposes uncomfortable truths about carbon reporting as potentially a "dark art" where data manipulation remains possible despite verification standards like ISO 14064. Kirsteen challenges the assumption that companies always need perfectly accurate data, arguing that the purpose of reporting determines the required precision.
For hotspot analysis and strategy development, understanding key levers matters more than decimal-point accuracy. For legal disclosures and verified reports, precision becomes critical. Yet many companies waste years and thousands of pounds chasing accuracy they do not actually need.
Emma shares a revealing case study of a call centre company that ignored carbon reporting requests for three years because the FD could not see the relevance (they operated in leased offices with minimal reportable emissions beyond business travel and employee commuting).
This illustrates how supply chain questionnaires often fail to account for business model variations, creating disproportionate burdens on companies with naturally low operational emissions.
Kirsteen offers a radically different approach: instead of panicking or ignoring requests, engage directly with the client, asking for the data. Her experience shows that sustainability managers at large corporations are desperate for supplier engagement and will welcome conversations about reasonable timelines, appropriate metrics, and phased implementation plans.
One client she worked with turned a compliance headache into a strategic partnership by proactively sharing their supplier engagement strategy and requesting feedback from their multinational client.
The episode tackles practical barriers, including spend-based conversion factors (a particular dark art within carbon accounting), the challenge of standardised reporting platforms like CDP and EcoVadis (comprehensive but resource-intensive for smaller companies), and the maturity journey from discomfort and fear through compliance to proud leadership.
Kirsteen emphasises that we are building an entire carbon accounting and sustainability disclosure system in years rather than the decades or centuries it took to develop financial and legal systems, so imperfections and gaps are inevitable.
Toward the end, Kirsteen highlights an invaluable new resource from the We Mean Business Coalition: a report cherry-picking best practice examples from 70 sustainability reports by companies under 1,000 employees.
This goldmine shows how smaller businesses can innovatively report what is relevant to them without being constrained by frameworks designed for multinationals, using their agility and flexibility as competitive advantages.
In this carbon reporting and supply chain sustainability episode, you'll discover:
- Why companies with 250 to 1,000 employees face disproportionate carbon reporting pressure without adequate resources
- How to determine what level of data accuracy you actually need based on the reporting purpose
- The strategic value of engaging directly with clients requesting carbon data rather than panicking or ignoring
- Why spend-based conversion factors represent a dark art requiring careful selection and transparency
- Real examples of companies turning compliance requests into strategic partnerships through proactive dialogue
- How to build a phased carbon reporting plan that demonstrates progress without overwhelming resources
- The difference between reporting for hotspot analysis versus legal disclosures
- Why verification standards like ISO 14064 cost thousands but may not always be necessary
Key Carbon Reporting Strategy Insights:
(02:50) Supply chain pressure reality: "What we're seeing from all of them is a lot of pressure through their supply chains... a lot of the pinch for medium-sized businesses comes when they are tendering for new work. It comes through contractual obligations."
(05:03) The missing middle problem: "Companies that have more than, let's say, a thousand employees are likely to have a sustainability function... The smaller SMEs may not require that kind of function, but actually it's these ones in the middle that are getting a lot of commercial pressure."
(12:24) Purpose determines precision: "Why do we do carbon accounting? What's the purpose?... if you're looking to do some hotspot analysis... the accuracy becomes perhaps a bit less important. And what's more important there is that you understand what the key levers are."
(13:44) The spend-based dark art: "When you start looking at spend-based conversion factors, it probably does turn into a bit of a dark art and you need to really understand how you pick those conversion factors and why you might choose one in one scenario and not on others."
(17:02) The fear and progression journey: "A lot of the work that we do with our clients is actually to get them to engage with their supply chain who are asking for these things to determine what it is they need and communicate all the good work that they are already doing because often that is enough."
(19:18) Client engagement opportunity: "On the occasion that I've worked with companies that are engaging up their supply chain, actually they've been met with open arms... Sustainability managers are delighted to be having these discussions."
(22:25) The pre-conversation preparation: "Find out where you are, because most companies will have done something, it just might be quite disjointed. And actually, if they can begin to pull together the things that they've done... then that gives them a better positioning to have that conversation."
(30:42) Narrative credibility: "A narrative won't be credible without some numbers. So maybe your narrative in year one is, we understand the importance of this, we have a plan in place to collect XYZ data, and by this day, we expect to have... our Scope 1, 2 and partial Scope 3 carbon footprint."
(33:08) Strategic carbon footprinting value: "If you begin to look at this strategically, it involves looking at, well, who are these suppliers? Who are we spending money with? And it can show other risks too. It can show dependencies on certain suppliers. It can show vulnerabilities in the supply chain."
Resources Mentioned:
- We Mean Business Coalition SME Reporting Guide (70 best practice examples from companies under 1,000 employees)
- Science Based Targets Initiative (SBTI) SME pathway
- CDP (Carbon Disclosure Project) platform
- EcoVadis sustainability assessment
- ISO 14064 verification standard
- NHS Evergreen Assessment framework
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