New guidance makes corporate value chain accounting easier

New guidance makes corporate value chain accounting easier

An effective corporate climate change strategy requires a detailed understanding of a company’s greenhouse gas (GHG) emissions. Until recently, most companies have focused on measuring emissions from their own operations and electricity consumption, using the GHG Protocol’s Scope 1 and Scope 2 framework. But what about all of the emissions a company is responsible for outside of its own walls -- from the goods it purchases to the disposal of the products it sells?

The GHG Protocol Scope 3 Standard, released in late 2011, is the only internationally accepted method for companies to account for these types of value chain emissions. Building on this standard, the GHG Protocol has released a new companion guide that makes it even easier for businesses to complete their Scope 3 inventories. The guidance is freely available for download via its website, but specific guidance for each category of scope 3 emissions will need to be downloaded separately.

How can business use the new guidance?

Assessing GHG emissions across the entire value chain can be complex. For companies just beginning to assess their Scope 3 emissions, it can be difficult to know where to start. This calculation guidance is designed to reduce those barriers by providing detailed, technical guidance on all relevant calculation methods. It provides information not contained in the Scope 3 standard, such as:

 

  • Methods for calculating GHG emissions for each of the 15 categories of Scope 3 emissions (such as purchased goods and services, transportation and distribution, and use of sold products);
  • Guidance on selecting the appropriate calculation methods; and
  • Examples to demonstrate each calculation method.

The guidance can help companies understand the full climate change impact of their business throughout its value chain and develop more effective GHG reduction strategies. This increased understanding can benefit the companies themselves, as well as their suppliers, customers and other value chain partners. The guidance was developed in partnership with the Carbon Trust, whose GHG measurement expertise and practical experience has helped develop calculation guidance that provides a clear and coherent approach to carrying out a Scope 3 assessment.

LEARN MORE: To further support companies to manage value chain emissions, GHG Protocol is also hosting online training on the Scope 3 standard. The next training takes place May 7, 8 and 9. For more information and to register for the training, visit the GHG Protocol website.

This article is reprinted with permission from WRI’s Insights blog.

Photo of industrial smoke from chimneys provided by Martin D. Vionka via Shutterstock.