Managing these external emissions is hard, as they often lie outside of a company’s direct control. How do you get a supplier to change its practices? How do we capture these emissions data points? How do we assess the data quality?
Upon hearing the term “Scope 3,” one might think of a doctor’s office, a bottle
of mouthwash or maybe a sci-fi movie. But Scope 3 refers to and accounts for the
greenhouse gas emissions that are not generated from onsite operations (Scope
1), or offsite emissions needed to create electricity (Scope 2).
Scope 3 emissions can come from the following sources:
-
Purchased goods and services
-
Capital goods
-
Driving Internal Organizational Alignment and Better Cross-Functional Collaboration
Join us as leaders from Daggerwing Group, General Mills, J. Lohr Vineyards, Sylvain and Caribou Coffee explore aspects of evolving internal company governance, culture and collaboration that enable stronger connections with consumers across generations and with evolving mindsets — Wed, May 8, at Brand-Led Culture Change.
Waste generated in operations
-
Business travel
-
Employee commuting
-
Upstream transport and distribution
-
Downstream transport and distribution
-
Use of sold products
-
Investments
Source: Compare Your Footprint
In many sectors of the business community, Scope 3 emissions represent most of a
company’s overall emissions.
For example, the majority of emissions coming from the Food and Agriculture
sector are embedded up the value
chain
in the dozens to thousands of farms producing food: Scope 3 emissions.
In the Automotive
sector,
most emissions are embedded down the value chain within the millions of
purchased and leased vehicles that are being driven around and between cities
and towns: Again, Scope 3 emissions.
Managing these emissions is hard, as they often lie outside of a company’s
direct control. How do you get a supplier to change its
practices?
How do you get customers to change their
behavior?
These are difficult management questions with many potential answers.
Emissions generated from within a company’s employee
base
also represent a significant chunk of a company’s total Scope 3 emissions. And
with many companies’ employees working remotely now, this way of doing business
is likely to continue — more dispersed, more remote, less in their control.
This shift in emissions from within the operational four walls of a company to
the countless sets of four walls around employees’ homes, apartments, coworking
spaces, etc will no doubt be a reporting burden that many companies will
increasingly face. But this focus is necessary and important, as it addresses
the most pressing risk that business faces — climate change — while helping
business’ greatest asset: Employees.
How do we capture these emissions data points? How do we assess the data
quality? How do we incentivize companies to tackle these issues? How do we help
the companies on board to incentivize their employees to participate?
We know this is of growing interest to companies. From our research this past
summer, we ascertained that many companies have voluntarily signed up for the
following leading sustainability/ESG programs, all of which address Scope 3
emissions in some form or fashion:
In addition, our friends over at Pivot Goals, a
project of Winston Eco-Strategies, recently
reported
that over 200 companies have made 370 net-positive
goals
in the past year.
And there is little overlap of companies — meaning that together, this list
represents many unique organizations. That is great news for the world and
emissions reductions.
We will be at the Sustainable Brands ‘21 conference in San Diego next week — our
first flagship SB conference — and look forward to meeting others interested in
this quickly
evolving
and extremely important topic within the greater sustainability community.
Published Oct 12, 2021 8am EDT / 5am PDT / 1pm BST / 2pm CEST
Dan Ridings is COO at Energy Datametrics, based in Nashville.