Understanding Scope 3 Emissions: The Hidden Carbon Footprint
When it comes to assessing a company's carbon footprint, Scope 3 emissions often slip under the radar. Yet, these indirect emissions can sometimes be the largest part of an organisation's carbon impact. According to the Carbon Trust, for some companies, Scope 3 emissions can account for up to 90% of their overall carbon footprint.
What are Scope 3 Emissions?
Scope 3 emissions, often referred to as 'value chain emissions,' are the indirect emissions that occur both upstream and downstream in your company's operations. They are more elusive to quantify and control, but their impact is profound, often far exceeding the emissions from direct operations (Scope 1) and energy consumption (Scope 2).
Upstream Scope 3 Emissions - These are emissions related to the goods and services your company purchases to operate. For instance, emissions from the extraction and production of raw materials, manufacturing of products you purchase, and transportation of goods to your facility are all examples of upstream Scope 3 emissions.
Downstream Scope 3 Emissions - These occur after your product or service has been delivered to the customer. Examples include emissions from the use and end-of-life treatment of your product, transportation-related emissions after the sale, and even emissions generated when employees travel for business or commute.
Why are Scope 3 Emissions Important? -Scope 3 emissions are critical for several reasons. First, they often make up the largest portion of a company's carbon footprint. Second, they're vital for gaining a comprehensive understanding of your environmental impact. Lastly, addressing these emissions can offer significant opportunities for innovation, cost savings, and strengthening relationships with suppliers and customers.
Identifying and Addressing Scope 3 Emissions - To tackle Scope 3 emissions, businesses often conduct a detailed supply chain audit to identify the most significant sources. Once these are identified, you can work with your suppliers to implement more sustainable practices. By actively managing Scope 3 emissions, companies not only move closer to achieving carbon neutrality but also play a crucial role in influencing systemic change in their respective industries.
Why They Matter
Supply Chain Resilience: As regulatory pressure increases, it's crucial to ensure that your suppliers are also committed to reducing their carbon footprint.
Customer Expectations: More consumers are looking into the lifecycle emissions of the products they buy, not just what happens during manufacturing.
Competitive Advantage: Addressing Scope 3 emissions can help set you apart from competitors who only focus on direct emissions.
Steps to Tackle Scope 3 Emissions
Identify and Assess: Conduct a thorough audit of your supply chain to identify sources of emissions.
Engage Stakeholders: Work with suppliers and partners to come up with emission-reducing strategies.
Set Targets: Establish clear and achievable targets based on collected data, and monitor them regularly.
Conclusion
Ignoring Scope 3 emissions could mean missing out on significant opportunities for carbon reduction, cost savings, and brand enhancement. Comprehensive carbon footprinting that includes Scope 3 emissions provides a holistic view of your environmental impact and can guide more effective sustainability strategies.
