What are Scope 3 Emissions?

Scope 3 encompasses all emissions not covered within Scopes 1 and 2. These indirect emissions are not produced by assets owned or controlled by the company, but they are created in an organisation’s value chain from both upstream and downstream activities.

The GHG Protocol groups Scope 3 emissions into 15 categories. Upstream activities include purchased goods and services, capital goods, fuel and energy-related activities, transportation and distribution, operational waste, business travel, employee commuting and leased assets. Downstream emissions include transportation and distribution, processing of sold products, use of sold products, end-of-life of sold products, leased assets, franchises, and investments.

Scope 3 emissions are often the biggest contributor to an organisation’s total carbon emissions. In addition, they are also the most difficult to quantify due to the complexity and involvement of multiple stakeholders. While reporting Scope 3 is not yet mandatory, successfully measuring and disclosing Scope 3 emissions can provide companies a competitive advantage.