Restaurant companies like Wendy’s face a difficult challenge because the majority of their GHG emissions are attributed to Scope 3. In the simplest terms, Scope 1 and 2 emissions are owned or controlled by the company; whereas Scope 3 emissions are considered consequences of the company’s actions but occur from sources that are not owned or controlled by the company, such as supply chain vendors or franchise operators.
Only about 5 percent of Wendy’s restaurants are company-owned, and 99 percent of the chain’s GHG emissions fall into Scope 3.
“With our franchisees, we are still setting reduction targets, but we know a key part of that will be reducing the emissions of our restaurant operations and, in many cases, that will be directly related to energy use in the restaurants,” Esposito explains. “Over the last five years we’ve been part of the U.S. Department of Energy’s Better Buildings Challenge; all our company restaurants participate as well as about 12 franchisees, about 1,000 restaurants total. There has been the benefit of being able to work together around the benchmarking and measuring of electricity and other energy uses, as well as the associated GHG emissions that go along with that. We have voluntarily taken on a commitment to reduce that energy capacity by 20 percent by 2025.”
Working together with franchisees is a win-win as it improves the footprint of each restaurant’s environmental impact and it reduces costs overall. The same holds true on the supplier side, and Esposito notes that the company’s goal to responsibly source its top 10 food categories by the year 2030 includes both environmental and social components.
“We are actively reaching out to our suppliers to share with them what our footprint looks like and the role that they play in that footprint,” she says. “We will be partnering with them to understand what their contribution to that footprint is and what sort of reductions they can make to help us meet our reduction targets. In many cases, our Scope 3 will be their Scope 1, and many of those suppliers have set their own targets for GHG emissions and, even those that have not set targets are certainly working on efficiencies.”
Where more than 6,500 of Wendy’s 6,949 restaurants are franchise-owned, Chipotle’s 3,000 restaurants are 100 percent company-owned and operated, so its percentage of Scope 3 is lower than restaurant operations that are heavily franchised. Roughly 93 percentage of Chipotle’s GHG emissions fall into Scope 3.
“We have committed to reducing our absolute Scope 1, 2, and 3 greenhouse gas emissions by 50 percent by 2030, from a 2019 base year,” says Laurie Schalow, chief corporate affairs and food safety officer at Chipotle. “To keep ourselves on track with our 2030 goal, we have also committed to reducing our Scope 1 and 2 GHG emissions by 5 percent by the end of 2022.”
Additionally, Chipotle has formed an internal climate steering committee “to guide decision-making, determine reduction targets, and drive strategy forward to reduce emissions in the most carbon-intensive functions of the business.”
Another topic raised throughout conversations of climate control is water conservation. It’s a concern for all restaurant operators and, in particular, for those where their footprint extends into drought-prone, high-risk geographies.
“In 2021, we developed a program to assess our water risks,” Schalow says. “We are in the process of completing our water risk assessment and then will develop programs to address water usage across our supply chain, ingredients, and restaurants. This assessment will allow us to better understand where our key water risks and impacts lie, and to advise the next steps for water stewardship projects in our facilities and supply chain.”
Similarly, Wendy’s has been focused on water improvements. After completing its own water risk assessment, Esposito says, “we identified that about 40 percent of our restaurants globally exist in areas that are considered moderate- to high-risk, and geographically its exactly where you would expect.”
Perhaps surprisingly, the vast majority of those sites, 85 percent, are located in the U.S.
The company joined the Department of Energy’s Better Buildings Water Challenge in 2019, and set a goal to reduce water usage in company-owned restaurants within the U.S. by 20 percent by 2029, compared against a 2018 baseline.
“Last year we reduced it by 21 percent on the company side, and one franchised unit reduced their water usage by 31 percent, and they operate in Florida, which is a critical area,” Esposito continues. “There is no silver bullet solution, but after monitoring and measuring, certain solutions will make sense in different areas. One of the tools we’ve implemented at several of our company restaurants is metering technologies, so we can identify how water is being used and compare it to water usage in similar locations. In other cases, we’re using landscaping monitors and sensors that identify when it’s raining so the restaurants don’t turn sprinklers on when the ground is wet.”