Could Business Travel Unlock Supply Chain Sustainability?

A significant transformation is under way in how companies approach business travel. Long considered an environmental liability, it is now becoming a driving force for corporate sustainability.

At the heart of this shift is carbon pricing, a mechanism that is reshaping the supply chain to support environmental and financial goals.

Business travel accounts for a substantial share of airline profits — up to 75% on some flights. This makes it a high-impact area for introducing sustainability measures.

According to the World Bank, 24% of global emissions are now covered by carbon pricing schemes, with revenues from these exceeding US$100bn.

For companies rethinking their supply chains, integrating carbon pricing into travel strategies is proving to be both an environmental and financial game-changer.

Carbon pricing: A strategic approach

Carbon pricing operates on a simple premise: attaching a financial cost to emissions to drive sustainability.

Paul Abbott, CEO of American Express Global Business Travel (Amex GBT), explains its relevance to supply chains, particularly when applied to business travel: "Whether your company is advanced or in the preliminary stages of its carbon pricing journey, business travel is an easy place to start."

He proposes a three-step framework for embedding carbon pricing into corporate travel policies:

1. Implement fees for air travel: Options include flat fees per flight, charges based on distance or travel class, or emission-based fees aligned with a company’s carbon calculation methods.
2. Scale fees by impact: Higher fees are applied to travel with a greater environmental footprint.
3. Reinvest fees: Funds are allocated to decarbonisation initiatives such as sustainable aviation fuel (SAF), electric vehicles and research into emissions-reducing technologies. 

This model not only incentivises low-carbon travel choices but also generates funding for long-term sustainability projects.

"Coupling carbon pricing with decarbonisation is how the world can achieve net zero," Paul adds.

For supply chain professionals, this approach integrates environmental accountability directly into business operations. It shifts sustainability from being a cost centre to a revenue generator that underpins broader organisational goals.

Transforming supply chains with carbon pricing

The impact of carbon pricing extends beyond large corporations to SMEs, which often lack the resources for dedicated sustainability budgets.

Paul highlights this potential: "For SMEs, carbon pricing could prove even more valuable in that it can help a company build a sustainability budget where one does not exist."

By embedding carbon costs into travel decisions, companies of all sizes can create a self-sustaining mechanism for funding decarbonisation. This approach is not merely an add-on to supply chain operations — it is becoming a central pillar of strategy.

Lucian Alexandru, Global Procurement Category Head at Sanofi, reinforces this idea: "Emissions-based carbon pricing enables us to combine economics, sustainability and technology to strengthen our business travel programme."

The reinvestment of carbon fees into projects like SAF and other low-carbon technologies demonstrates how the supply chain can lead corporate environmental efforts.

Travel becomes not just a logistical necessity but a strategic tool for achieving sustainability goals.

Amex GBT: Leading by example

Amex GBT is at the forefront of this shift, assisting businesses in implementing carbon pricing frameworks for air travel.

By calculating emissions-related costs and directing those funds into decarbonisation efforts, Amex GBT offers a practical model for companies looking to integrate sustainability into their supply chains.

In addition to reducing emissions, the startegy:

• Increases transparency around corporate carbon footprints.
• Funds innovative low-carbon technologies.
• Signals a company’s commitment to responsible business practices.
• Positions business travel as a driver of long-term environmental impact.

In an era where supply chains are under pressure to adapt to environmental challenges, Amex GBT’s model provides a blueprint for balancing economic growth with climate action.

Companies that adopt carbon pricing are transforming their supply chains into catalysts for sustainability, paving the way for a more responsible approach to global business travel.

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