Investors are increasingly scrutinizing ESG performance – and looking for companies to rise to the challenge.
There has been exponential growth in organizations calculating and reporting emissions from their directly owned or controlled business activities (Scopes 1 & 2). And now there is a rising interest in the carbon we are not counting, which comes from all indirect impacts of an organization both upstream and downstream. These emissions occur as a consequence of business operations from sources that are not owned or controlled by that business directly – such as from the supply chain, transport to operational sites or to customers, product use, and end-of-life treatment.
Research indicates that 5.5x more emissions come from the supply chain alone, so any organization that’s serious about decarbonization should report and reduce Scope 3 emissions.
Reporting and reducing Scope 3 emissions is of most immediate relevance to organizations who report to CDP or have committed to Science-Based Targets; and it has the most impact for organizations that operate in one of the eight supply chains that account for over 50% of global emissions – namely food, construction, fashion, fast-moving-consumer-goods, electronics, automotive and freight.
Scope 3 reporting provides the opportunity for companies in key industries to multiply their carbon reduction impact by decarbonizing their supply chains.
Here’s how to approach Scope 3 calculation and reporting in a systematic way, and how sustainability software like Envizi can help.