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How collaboration can open new opportunities to reduce emissions
In this episode of the Sustainability Matters podcast, hear practical insights for integrating sustainability into business priorities and product innovation highlighted by Carrier’s Sustainable Future initiative.
In this episode of the Sustainability Matters podcast, hosts Bruno Sarda and Anne Munaretto interview Ravi Annapragada, Director of Sustainability and Energy Strategy at Carrier, a global supplier of heating, ventilation and air conditioning (HVAC) products. Together they discuss ‘Joining forces for a sustainable future’, a collaboration between Carrier customers, suppliers and internal teams that aims to accelerate decarbonization and drive meaningful sustainability progress.
The initiative, engaging 10 major customers across various sectors at different stages of their sustainability journey, highlights the benefits of moving away from isolated efforts toward partnership and co-creation.
The discussion describes the HVAC giant’s path to setting ambitious science-based targets, recognizing that most emissions stem from product use and realizing that addressing these challenges requires collaboration rather than a solely transactional relationship. The guests also emphasize the importance of internal alignment, especially with sales teams, and demonstrate that sustainability and business growth can be mutually reinforcing.
Key takeaways:
To successfully collaborate in sustainability efforts, secure internal and cross-functional buy-in, do thorough homework on customer needs, listen actively, and treat customers as core development partners.
Tackling sustainability alone is a risk, but ongoing partnership with shared value can yield transformative results for companies and society.
For your convenience, full text transcript of this podcast is also available.
Ravi Annapragada
The fastest progress happens when you stop working in isolation and actually start partnering with customers, suppliers, even across your own teams. That's when real decarbonization momentum comes from. We basically asked, What if we partner differently? What if we solve this together with our customers?
Bruno Sarda
Hello and welcome to the EY Sustainability Matters podcast, our regular look at sustainability topics and their impact on businesses around the globe. I'm Bruno Sarda, EY America's Climate Change and Sustainability services Leader and your host for this episode. And in this episode, we're exploring how collaboration can unlock new opportunities to reduce emissions and drive impact across the value chain.
Sarda
It's a powerful reminder that when it comes to sustainability, working together can often take us further than going it alone. And to bring this to life, we're focusing on an initiative called Joining Forces for a Sustainable Future, a structured customer engagement project for 10 major customers across data centers, industrial, retail and transport refrigeration.
It's led by Ravi Annapragada, Director of Sustainability and Energy Strategy at Carrier, and Carrier’s a global provider of high technology heating, air conditioning and refrigeration solutions. And recognizing that most emissions come from product use, the company is looking at new ways to partner across its ecosystems with suppliers and customers to drive down emissions and accelerate progress toward shared sustainability goals.
To guide the conversation, I'm pleased to welcome my fellow Partner and colleague Anne Munaretto, Partner, Climate Change and Sustainability Services, Ernst & Young LLP, who works closely with Ravi and Carrier on this project. Anne, over to you.
Anne Munaretto
All right. Thank you so much, Bruno. I'm really excited to be here, and looking forward to what I know will be an insightful discussion. So, Ravi, welcome. Before we get into the details of your initiative and work, could you start by telling the listeners a little bit about your background and really what brought you into the sustainability field in the first place?
Annapragada
Thanks, Anne. I'm really excited to be here as well. Personally, I'm an innovator at heart. I've spent my career developing advanced heating and cooling technologies and turning big ideas into real solutions for customers. Now, I lead energy and sustainability strategy at Carrier to transform HVAC (Heating, Ventilation, and Air Conditioning) equipment into grid-interactive assets and help customers reduce energy costs, and, in parallel, improve grid resilience and decarbonization at scale.
What pulled me into sustainability was realizing just how much buildings and HVACs in particular, shape global energy use and emissions. I mean, for example, buildings contribute to 40% of global emissions and HVAC contributes to 40% of those building emissions. So, if you're really serious about making a meaningful impact, HVAC is one of the most powerful levers we have to reduce emissions, and it's virtually in every building.
That prospect also led us to envision the study ‘Joining Forces for a Sustainable Future’, and engage you and your team. Across the 10 customers we engaged, we saw the same pattern: bold ambitions, which are paired with uneven confidence in achieving net-zero goals. As we listened, distinct profiles actually emerged. There were organizations focused on quick operational wins, others experimenting with emerging technologies and a smaller group looking to reshape the entire value chain.
We call them beginners, explorers and leaders, and that made one thing clear: the fastest progress happens when you stop working in isolation and actually start partnering with customers, suppliers and even across your own teams. That's when real decarbonization momentum comes from.
Munaretto
Yeah, I love that. I think what struck me during this project was just how collaborative the conversations were. So often we think of a customer-supplier relationship as a very rigid, you know, provide me what I need on time, on spec, on price. Instead, these conversations, they were collaborative, they were deeper. It was sharing challenges and recognizing, like you're saying here, we can make more progress together.
So, congratulations to you and the team for setting the right tone, for being prepared. Let's dive into our questions then that can help our listeners understand more about this project and how it may be relevant in their organizations. First question for you: Can you share with us what initially gave you that idea for Joining Forces for a Sustainable Future?
Annapragada
Sure. This all started when we were signing up for science-based target goals. Carrier had signed up for 2050 net-zero goal, and a bold near-term goal of reducing our absolute emissions by 25%. While formulating the playbook to reach them, we recognized a simple truth. Carrier can't decarbonize alone. Most of our footprint comes from Scope 3 downstream emissions, which is how our products — which are chillers, heat pumps, transport refrigeration equipment — all operate inside customer facilities.
In parallel, when we looked at our own customers’ footprints, and how they're trying to decarbonize, we saw many struggling to reduce their Scope 1 and 2 emissions, a meaningful portion of that was tied directly to HVAC and refrigerant loads. So, instead of trying to figure it out all by ourselves and keeping interactions with our customers only about our offerings, we basically asked what if we partner differently? What if we solve this together with our customers? So that question became the foundation for Joining Forces for a Sustainable Future study.
Moving from transactional relationships to collaborative ones, where we are cocreating roadmaps and accelerating solutions as part of a shared journey, rather than a handoff at a point of sale. And candidly, one customer summed it up perfectly, “Sustainability shouldn't be competitive. We can't do it all by ourselves.” So, that mindset validated the need for this new approach.
Munaretto
That makes perfect sense. So many of my industrial clients are in the same situation, where, you know, Scope 3 Category 11 emissions, or those use phase emissions, make up the, largest portion of their emissions profile. And they can really only be brought down in concert with broader engagement, systemic change. There's some stuff, right, that the company can do, but, but a lot is, is also in the balance.
But going from an idea to making the idea come to fruition is tough. For example, I know before reaching out to customers, you spent a lot of time building alignment internally. So, tell us a little bit about that process, as well as any challenges or skepticism you had to overcome.
Annapragada
Yeah, that idea had legs. However, to execute, it required collaboration and alignment across multiple functions, even within Carrier, like engineering, product management, sales, supply chain, and of course, sustainability. So, the first step that we took was to get executive buy-in across all these functions. We showed through our sustainability roadmap that sustainability and Carrier’s revenue growth are not conflicting goals but are actually aligned.
Sustainability can accelerate adoption of differentiated products like heat pumps, unlock new markets for us like demand response, and strengthen customer and even investor confidence. So, once we got that buy-in, the next thing was to figure out, how do we actually reach these customers? So, we had to align with our sales teams who owned the relationship with our customers.
At first, there was some hesitation, concerns that customers might not have the appetite for these conversations or that we could unintentionally disrupt relations that they have carefully built over years. What changed was showing the value of the learnings we did gain, and how it could directly help our customers in their sustainability journeys. We also made it crystal clear that sales teams would be in the loop from start to finish,
that also helped build confidence. By the end of the study, the perspective had totally shifted. They saw that sustainability wasn't a nice to have for customers, it was clearly a core need for them. And today, we are regularly being pulled into customer conversations specifically to talk about sustainability.
Munaretto
Great. Okay, so it sounds like just to sum that up, step one: Get executive buy-in. And I know we've covered that ad nauseam on other Sustainability Matters podcasts too, so important for so many initiatives. But then also it sounds like the key players internally were really sales for you. So, follow-up question, did the sustainability team historically have a strong relationship with sales?
Was this relatively new? And it seems like it's an important connection point. So, it would just be great to hear, you know, if you think that this relationship that you've built, is going to help Carrier in other ways in the future.
Annapragada
In the past, it was a support role, mainly answering supplier ESG questions from customers that when they would reach out to us. But the study definitely strengthened that partnership. So, beyond being just responsible for providing a quick Q&A around ESG, now it's developed into a strategic partnership where they actually leverage us to understand customer needs and help tailor solutions.
Munaretto
Perfect. Okay, so tell us, now that we have the sales team on board, how did you go about trying to convince customers to partner with Carrier on sustainability? What was the process?
Annapragada
Yeah, we started with sustainability leaders at customers we knew well and had long-standing relationships. Sustainability leaders at these large organizations already understand that suppliers are essential to meeting their climate goals. So that created a positive peer-to-peer dynamic from the start. Secondly, we did our homework, reviewing their publicly stated goals, their decarbonization plans and the progress that they have made so far.
We also gained insights from the sales teams around what specific customers have actually historically purchased or have communicated as needs to our sales team. Then we showed up, not with a pitch, but with insights on a superset of decarbonization pathways and questions around what their preferred decarbonization pathways are. The questions were, what are you trying to solve?
What are the barriers? Where can we help? That approach resonated across all sectors. Many customers actually told us no supplier had engaged them in this way before. One customer actually requested the decarbonization pathways we laid out for them to help their own roadmaps. It opened the door to true partnership quickly.
Munaretto
Yeah, that, that discussion tool that we were putting in front of each of the customers, I think was really helpful, and kind of showing them the different, the different paths and allowing them to quickly see their own decarbonization journey, just on a simple page. So, I think that was a great tool that, that we developed together.
So, from those discussions with customers, what were the most important insights that you heard and what surprised you the most?
Annapragada
There were a couple of themes that really stood out. Customers want more innovation and circularity than we anticipated. We originally focused on how our current products fit their needs, but customers pushed us further toward new ideas, circular business models and were asking us to consider even emerging technologies. In transport refrigeration, for example, they asked about secondary market options, take-back programs and even refurbishment models that extend the asset life.
The second one was embodied carbon was really becoming a priority. Some customers have made real progress on Scope 1 and 2 emissions through electrification efficiency improvements and including renewables in the energy mix. However, the next frontier was the upstream Scope 3 emissions, understanding and lowering the carbon footprint of the equipment that they purchased. This was consistent across tech and even retail, where they explicitly asked for lifecycle analysis of our products, greener materials and actually more supplier transparency.
That shift, I see is moving quickly and something to, for all the listeners to take note of.
Munaretto
Yeah. Fantastic. I think going in, we knew with Carrier as an HVAC company, they know that where you guys are headed is, how do we make products more efficient, and how do we offer lower, lower carbon-intensive refrigerants. So, that was all kind of known. And I agree it was impressive to see them kind of push on some of the more innovative areas.
And, and also when we think about what the customers were looking at decarbonizing, they were looking beyond operations, right? They were looking upstream and downstream at their emissions, and it was also interesting too,what struck me was, we made sure that Carrier brought sustainability and sales to the table, and on their end, they brought a truly cross-functional team,
right? They brought sustainability, usually in procurement as well, but also sometimes operational or strategic leaders or facilities or supply chain, really areas of their key challenges. So, it was, it was cool to see them really tackle the issue from all sides.
Annapragada
Totally, they were looking at this as a true partnership and not just a sales v supplier engagement, but a partnership across all functions.
Munaretto
Yeah. And with all that rich conversation, what are some of the largest opportunities or largest gaps in sustainability and reaching net-zero that you think could benefit from greater collaboration within the sector?
Annapragada
Three areas rose to the top. How to electrify heating under current grid constraints. Customers want to electrify, but grid constraints are real. Moreover, with the hyper growth in AI data centers, the gap between current grid growth and the needs is growing and widening. I do believe we have to have collaboration across the demand side and also the grid side. If we can make this demand side,
equipment grid-interactive and demand-response-capable, that creates a huge growth opportunity for everyone, not only in terms of revenue, but also in terms of decarbonization. In fact, at Carrier, we came to that realization and are launching a battery-enabled HVAC that can provide that demand flexibility and alleviate the grid constraints to enable faster decarbonization. Collaboration is essential to navigate capacity, peak demand and even future load planning.
The second one is system-level optimization. We have optimized individual products for decades. Now the gains must come from optimizing the entire system. That includes HVAC, controls storage, renewables, thermal loads, everything together. These pieces work best when we actually design them and operate them together, and that takes real partnership. The third one, like we were talking about earlier, is embodied carbon.
Reducing embodied carbon requires coordinating across materials, manufacturing, supply chain and across multiple organizations and even end-of-life planning. The first step to reduce embodied carbon is to first be able to provide transparency at the product level. Many customers have requested lifecycle analysis, which are certified, which are called environmental product declarations, and we now have a center of excellence within Carrier to deliver these certificates efficiently.
Embodied carbon: no single company can solve this alone and requires collaboration across the value chain to reduce these emissions. One customer put it plainly, for them, steel is one of their biggest hotspots, and we need suppliers who can reduce the carbon footprint associated with that for them.
Munaretto
Yeah, fantastic. So yeah, you highlighted three super complex issues here. It's great to hear you highlight Carrier Energy. When we think about grid constraints and electrification, I know that when we brought it up with the customers, that was one item that kept on coming up as, as high interest. And okay, this sounds fantastic, it sounds like it will improve resiliency and help us electrify.
So that is great, and I'm looking forward to seeing more from Carrier on that. The second one that you mentioned here, systems-level efficiency, this is another one that came up time and again. Would you just explain it in kind of simple terms, what we mean by system-level optimization for the listeners?
Annapragada
Sure. This is basically looking holistically at not just the equipment level but looking at it maybe from the building level. Or I would even expand it all the way till the grid. So, you might be able to optimize that piece of equipment to operate efficiently, but you can actually get huge gains if you say, hey, the carbon footprint of the grid is much lower in the afternoon, so, maybe I store the energy and pull the energy from the grid during that period and then use it when the carbon footprint of the grid is much higher,
when you don't have renewables in the mix. So, that kind of optimization is what I would consider as system-level optimization and not just focusing on the equipment efficiency.
Munaretto
Perfect. Thank you. And this was another one that pretty much every customer we spoke with was interested in. And I think what was so interesting too, is probably because we weren't just speaking with procurement, at these customers who were just looking for, for example, a chiller, we were able to talk with someone that has that broader view of overall energy consumption, emissions management, energy spend, and be able to have that conversation and talk about these additional tools outside of the standard product that, that can still overall lower emissions, lower cost,
so, I thought that was another great win for you guys. And, and for society and for your customers too. And then, yes, embodied carbon was top of mind, especially for those customers, like you said, where, where they were really focused on steel. So again, lots of upside here, lots of problem-solving that you were doing with, with those customers. At the same time, before getting into this, did you see any risks, or did you have any anticipation of risks and trying to partner with companies on sustainability?
Annapragada
There are always risks when you are trying to engage anyone outside your company, especially around data sharing, alignment of the goals, as well as timing. But I would say that the bigger risk is trying to solve everything alone. So, after setting the right guardrails, collaborating with trust was smoother than many expected. In fact, I would say we need to truly understand what the customer needs before we start developing any product. So, for a meaningful product,
the voice of customer is really important, and breaking it down into product and component requirements is key, and then verifying that we have actually created a product that meets the need that they have aligned, is truly how we should be developing any product or solution.
Munaretto
Completely agree. That sounds great. As you entered into these sustainability-focused collaborations based on net-zero, did you think about maybe centering the conversation on something other than emissions? Maybe on cost or energy or building resiliency?
Annapragada
The focus of the study was purely sustainability focus. However, that was the entry point, but the conversations quickly shifted to cost, energy and even resiliency. Net-zero is important, but customers often first want to know, will this lower my energy bill? Will it help me manage peak demand? Will my operations be more reliable? So, once those needs are met, the sustainability benefits naturally follow.
And that's why we've had some real strong interest in solutions that can help enable that, like Carrier Energy that we talked about, which helps them with the resilience, flexibility and decarbonization at the same time.
Munaretto
Let's get into a lightning round of results. So, can you share some of the tangible outcomes from these conversations? Are there any exciting technological or collaborative developments that came out of the process?
Annapragada
Yeah, there were several amazing outcomes. And let me, let me highlight a few of those here. The study actually helped identify decarbonization opportunities at the facilities level for a key industrial customer that Carrier could help address immediately. Another large customer in the tech industry, with them, sharing our environmental product declarations, created a much deeper collaboration and actually gave us insights into how to reduce our own equipment carbon footprint.
We are also exploring a pilot with a retail customer around an offering tied to cost-effective electrification of their storefronts. And we are also now looking at circular business models with transport and IT infrastructure customers. So, across every sector, customers were willing to engage earlier in the product development cycle, and that's actually helping shape our innovation and product development strategy as well.
Munaretto
Fantastic. Thank you. Okay, last question from me here. What are some of the top lessons learned? You've been through this process, you started with the broader Carrier sustainability team when this was just an idea, you worked through internal alignment, you engaged customers, we've got a bunch of follow-up that we're doing with customers to go ahead and, and work on these outcomes and, and drive decarbonization throughout the sector.
So, looking back on this, what are some of your top lessons learned that you would like to share with other sustainability leaders thinking about exploring how to partner and collaborate?
Annapragada
For the audience, I would say there are five key takeaways. The first one is to start with securing that internal buy-in, aligning leadership and sales teams and then taking them along the journey is key. The second one is do your homework. Customers notice when you understand their strategy and see that you have put in the effort, and that goes a long way in building the confidence but also having a discussion which is not just surface level, but deeper.
Also, I would say bring in the right mix of competencies to the table. So, we had product, sustainability and even technology know-how that we actually combined when we were having those discussions with the customers. And this basically creates that multifunctional collaboration and creates insights that you would not get if you are just in sustainability or in engineering.
The fourth one is, listen first. It builds trust and reveals what the customer truly wants to communicate. We showed them the super-set of decarbonization pathways and then just let the customer digest it and speak. We know that we do not have answers to all their pain points, but admitting what we can and cannot do is key and actually builds credibility.
And the last one, but I would say the most important one, is to create shared value and treat leading customers not as customers, but as core developers. Partnership moves faster when both sides win, when you want to help shape what the next generation of technology should look like.
Munaretto
Wonderful. Thank you so much Ravi. Thank you for joining us today on the show. Thank you for including me as well as the rest of the EY team that couldn't be here with me today that got to serve Carrier on this project.
Annapragada
Thank you Anne, and thank you for the great collaboration, and happy to share my thoughts on how we can actually work together, not only to improve our own carbon footprint but maybe make an impact on the world.
Sarda
Well, thank you both. Thank you Ravi and Anne for such an insightful conversation. I really appreciated the, you know, the concrete examples and the specific insights that came out of these collaborations. I mean, as today's discussion reinforced, is that the power of partnership and sustainability, and how bringing key stakeholders together, both internal and external can be transformational because net-zero itself is a transformation, and no organization can get there on its own.
So, building the right amount of trust, collaboration and taking a shared problem-solving approach are, what can actually move entire value chain forward as you highlighted, and as you, you said, you know, Ravi, I think, very rightly so, this is not a one-off exercise, right? It's not like one and done. This is about, you know, building a sustainability engagement playbook and expanding this model globally. Showing what's possible, turning these customer insights into, into pilots, into product roadmaps and ultimately long-term shared value.
So, thank you again. This is the Sustainability Matters podcast. You can find all past episodes of the show on ey.com or wherever you get your podcasts. Thanks for listening. If you enjoyed this episode of Sustainability Matters, we'd love for you to subscribe! Ratings, reviews and comments are always very welcome and visit ey.com, where you'll find a wide range of related and interesting articles that will help put these bigger topics in the context of your business priorities.
I look forward to welcoming you on the next episode of Sustainability Matters. My name is Bruno Sarda. You can find me on LinkedIn. Feel free to connect with me there. Thanks very much for listening.
