“Let us end the reductive discussion of scope 1 v scope 2 v scope 3. We need to attack all emissions, everywhere: one, two and three.” As we move closer to COP28, the urgency to address climate change has never been more apparent and the words of Sultan Al Jaber are playing on our minds following our attendance at Adipec last week. There must be a focus on comprehensive climate action that encompasses all emissions, and a key aspect of this effort is the inclusion of Scope 3 emissions. To achieve the target of limiting global warming to 1.5°C, we must confront these indirect emissions from the entire value chain. In this blog, we will explore the significance of Scope 3 emissions and why secure data sharing is crucial for reporting them to tackle climate change.
Understanding Scope 3 emissions
Scope 3 emissions are defined in the Greenhouse Gas Protocol, as “all indirect emissions (not included in scope 2) that occur in the value chain of the reporting company, including both upstream and downstream emissions”. These emissions include categories such as purchased goods and services, transportation, and even the use of products sold by the company. While Scope 1 and Scope 2 emissions are well within a company’s operational control and mandatory to report, Scope 3 emissions are not and often lie beyond their direct influence. It’s difficult to comprehend the magnitude of Scope 3 without the understanding that these emissions are responsible for approximately 75% of GHG emissions in the world. If we continue to ignore this huge statistic, our ability and efforts to achieve ambitious climate goals will be massively hindered.
How can secure data sharing be beneficial for reporting Scope 3 emissions?
To effectively address Scope 3 emissions, secure data sharing is paramount for several reasons:
- Transparency and Accountability: By sharing emissions data across the value chain in a transparent manner, it will promote accountability. Organisations can identify sources generating high levels of emissions and work collaboratively with their suppliers and partners to reduce these.
- Informing Strategies: Having access to accurate emissions data allows organisations to make informed decisions about sustainable sourcing, transportation, and product design.
- Standardisation: By standardising the approach to data sharing, consistency can be ensured in reporting, making it easier for stakeholders to compare and evaluate emissions data across industries and sectors.
- Investor and Consumer Confidence: Companies that are transparent about their Scope 3 emissions demonstrate a commitment to sustainability. This can enhance investor and consumer confidence, which is increasingly tied to environmental responsibility.
In the journey towards limiting global warming to 1.5°C, addressing all emissions, including Scope 3 emissions, is non-negotiable. Secure data sharing is a crucial enabler for companies to accurately report and tackle their indirect emissions. By recognising the significance of Scope 3 emissions, adopting data sharing practices, and working collaboratively, we can take substantial steps toward a more sustainable and resilient future. As COP28 approaches, it is imperative that we commit to the comprehensive reduction of all emissions, everywhere.