Seminar (Dept. of Management Science and Engineering)

Title: Scope 3 Emission Disclosure in Supply Chains: Equity and Efficiency

Speaker: Bin Hu (The University of Texas at Dallas)

Time: 10:00 (Thursday), June 27th, 2024

Venue: Room 1008, Mingde Business Building

Language: English

ABSTRACT:

Firms are increasingly disclosing Scope 3 (supply chain) carbon emissions in addition to Scope 1-2 (direct and energy consumption) emissions. Two common Scope 3 emission assessments exist: Life-Cycle which encompasses emissions of all firms in the supply chain, and Cradle-to-Gate which encompasses emissions of all upstream firms. One can also conceptualize a Gate-to-Grave assessment which encompasses emissions of all downstream firms. We consider a supply chain where each firm discloses its carbon emissions subject to societal pressure, and study their carbon-reduction and product-pricing decisions and the supply chain outcome in terms of equity and efficiency under different carbon emission-disclosure regulations. We find that Gate-to-Grave is consistently the most equitable Scope 3 assessment in terms of both carbon and profit reductions along the supply chain, whereas all assessments are equally efficient in terms of both consumer welfare and supply chain profit for given supply chain emissions. These findings strongly advocate for the Gate-to-Grave Scope 3 emission assessment’s formal recognition and potential implementation.

SHORT BIOGRAPHY:

Dr. Bin Hu is Professor of Operations Management in the Naveen Jindal School of Management at the University of Texas at Dallas. He received a PhD degree in Business Administration from the University of Michigan in 2011, and a BS degree in Mathematics from Peking University in 2005. Before joining UT Dallas in 2018, he taught at the University of North Carolina at Chapel Hill. Dr. Hu’s research interest is in supply chain management, procurement and sourcing, and innovative operations, and primarily employs analytical economic, game-theoretic, and optimization models in his research. He currently serves as Associate Editor for Management Science and Naval Research Logistics, and Senior Editor for Production and Operations Management.