This study examines how customer demand for suppliers’ carbon disclosures affects suppliers’ emission performance. My analysis utilizes the CDP Supply Chain Program in which participating customer firms request their suppliers to disclose greenhouse gas (GHG) information. I find that compared to benchmark suppliers, treatment suppliers exposed to this program experience a decrease in Scope 1 emissions after their customers joined the CDP Supply Chain program. These effects are more pronounced when customers have stronger incentives to monitor emission performance along supply chains and have greater bargaining power against their suppliers, and when suppliers face greater pressure to reduce emissions. Further analysis reveals that treatment suppliers also attract more new customers, receive better environmental performance scores, and have more customers willing to publicly disclose their relationship. Overall, my findings underscore the role of customer demand for carbon disclosures in shaping emission performance along supply chains.
