Vodafone has signed up to the UNFCCC Race to Zero campaign and aims to achieve net zero carbon emissions across its entire value chain by 2040. To decarbonise its supply chain, Vodafone has tailored TCLP’s climate clauses and blended them with its existing environmental compliance provisions in its supplier agreements. This has also helped to enhance its procurement processes.
What do The Chancery Lane Project’s clauses deliver for Vodafone?
Vodafone has enhanced its existing environmental compliance provisions in procurement contracts by implementing additional clauses. They have used amendments to a number of provisions included in TCLP’s supply chain climate clauses and others (such as Frank’s, Dottie’s and Mary’s clauses). This work complements Vodafone’s Requests For Quotation (RFQ) process.
At the start of the project, Vodafone ran a robust consultation process with internal specialists and external legal stakeholders. It created two clause templates for suppliers, depending on the environmental risk of their business operations. The low risk supplier template includes lighter touch obligations and enforcement provisions to accommodate the capacity of SMEs and lower emitting suppliers. The high risk supplier template includes more detailed and onerous obligations tailored to suppliers with larger carbon footprints, such as reporting and termination provisions and options for alternative drafting.
How did The Chancery Lane Project help Vodafone get here?
With support from TCLP, Vodafone hosted an internal hackathon with its legal teams to better understand the value, challenges and feasibility of using climate clauses in its contracts. In-house lawyers at Vodafone are grateful to TCLP for driving concepts of climate-conscious drafting and providing accessible contract solutions that align its contractual frameworks with its net zero objectives.
What are the key takeaways?
- TCLP’s climate clauses are accessible and well drafted. The provisions can be tailored to manage the environmental risk of different categories of suppliers.
- It is important that clause implementation is supported by a robust process. Get buy-in from senior colleagues, consult specialist departments across the organisation and consider advice from external stakeholders.
- Discuss the value, challenges and feasibility of using climate clauses. Collaboration with colleagues will enhance understanding and drive the impetus for change through contractual solutions.