scope 3 emissions

Why Should Businesses Care About Scope 3 Emissions?

Ever heard of scope 3 carbon emissions? Chances are that you have. Calculating and reducing scope 3 emissions is a hot topic in the corporate world today, but what exactly does “scope 3” mean? And why has it soared to the top of most business agendas recently? Let’s sort that out, once and for all.  

What about scope 1 and 2 emissions? 

We can hardly skip the line, though. Before we take on scope 3 carbon emissions, let’s take a quick look at scopes 1 and 2. And who created this scope-hype? 

To sort that out, we’ll travel over 20 years back in time to the late 1990s, when the Greenhouse Gas (GHG) Protocol was initiated. 

It’s a partnership between the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD) that provides global, standardized frameworks for measuring and managing emissions for both the public and private sector1.  

Using the GHG Protocol, you measure your emissions according to three different categories or scopes, whether you’re a government or a private corporation. 

Scope 1 emissions:

They are direct emissions from assets owned by the organization, for instance, owned facilities, such as office buildings and company vehicles.  

Scope 2 emissions:

These are indirect emissions generated during the production of energy that the organization consumes. This includes all GHG emissions that occur during the production of the purchased electricity, steam, heat, and cooling. 

Scope 3 emissions- Three’s a crowd?

So scopes 1 and 2 cover direct and indirect emissions from energy. Then what’s left? The short answer to that is A whole lot. 

Namely, the juicy stuff that is scope 3 carbon emissions. Scope 3 covers emissions that originate from sources that aren’t owned or controlled by the organization but occur because of the organization’s activities. 

This includes an organization’s value chain, both upstream and downstream, with 15 subcategories. Upstream activities that fall under scope 3 emissions include, but are not limited to, business travel, employee commuting, waste generation, and purchased goods and services. 

Downstream activities included in scope 3 emissions range from investments and leased assets to the use and disposal of products sold to customers.  

If you compare the paragraph sizes of scope 1 and 2 vs. scope 3, you might guess that for most organizations, a vast majority of their emissions are part of scope 3. 

Imagine this 

Let’s allow our imagination to run wild for a second and say that you’re running a company that manufactures phones. You must purchase the raw materials needed for production, such as the lithium that goes into the battery, and transport the raw materials and the final product.  

And it doesn’t end there. All your employees must commute to work and even fly out to meet customers and suppliers. And once a customer has bought a phone, it needs to be charged throughout its life, and once it has taken its final breath, it often becomes waste and needs to be disposed of. 

All the emissions generated by these activities fall under scope 3. It makes sense that it represents the bulk of an organization’s emissions, doesn’t it? 

Why should businesses bother about scope 3 emissions? 

In short, the sheer size makes it an essential aspect of an organization’s sustainability work. But there are many other reasons why organizations should calculate their scope 3 emissions: 

1. Reduce costs  

By measuring their scope 3 carbon emissions, organizations can assess where there are emission hotspots in their value chain, which shows where there are risks and inefficiencies in their operations. 

This will aid the organizations’ sustainability work by highlighting the actual climate-criminal elements of their operations and revealing where there are opportunities for energy efficiency and cost reduction. 

If, for instance, logistics are causing a large share of the value chain’s emissions, deploying efforts to make it more efficient will reduce both costs and emissions at the same time. A real win-win! 

2. Influence the supply chain 

Collaborating with suppliers and helping them implement sustainability initiatives will provide mutual benefits and is an excellent example of corporate social responsibility (CSR) that many organizations practice nowadays. 

Looking further into the supply chain can also show which suppliers are high-performers and could do better in their sustainability performance. This paves the way for organizations to engage their suppliers to reduce their emissions. 

3. Improve the product 

These first two tips relate to the supply chain of an organization’s operations. But as we know, scope 3 emissions extend further downstream, with more benefits for organizations to reap by measuring the its emissions. 

Evaluating the emissions caused after they have sold a product can improve it, just like in the operations. If emissions are high in relation to the use and disposal, businesses can enhance the product by increasing its lifespan. This makes it more energy-efficient or recyclable, to name a few examples. 

4. Engage employees 

Finally, remember that scope 3 carbon emission also covers the commuting and business travel of an organization’s employees? This makes reducing it a great way to engage employees in sustainability, another aspect of CSR that’s only growing in importance. 

How can businesses Measure up with scope 3 emissions?

Alright, so calculating scope 3 emissions are essential. It can improve an organization’s product, supply chain, employee engagement… The list goes on! But how to go about it? 

An excellent place to start is with a carbon footprint calculator. By measuring your emissions through a carbon footprint calculator, you get a baseline of where you are today and the most significant potential for reducing your emissions.  

Whether you’re a curious employee who wants to know what part you play in scope 3 emissions or a CEO looking to measure your organization’s scope 3 carbon emissions, calculating and learning more about your commute and travel footprint is a great start. 

And there’s no time like the present to get going. Just head on over to Deedster’s carbon footprint calculator to find out your commute and travel foot.

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