It's time to stop doing sustainability as a project, initiative, or task force and recognize it as a core value that needs to be measured alongside traditional metrics like price, quality, and customer satisfaction. In this series, we show how achieving sustainability goals has a clear return on investment (ROI), leading to more sustainable operations, a stronger brand, and ultimately, winning in the marketplace.
Over the last two decades, the WRI and WBCSD have laid the foundations for a modern carbon accounting system and developed the vocabulary and scopes used by private and public organizations becoming a de-facto global standard for calculating greenhouse gas emission inventories1 .
Scope 3 may represent 80% of total carbon inventory2 but less than 25% of US companies reported Scope 3 emissions3. Corporate Sustainability Reports often omit half of their total emissions as well.
Besides sustainability corporate reports, thousands of companies disclose their carbon inventories via Climate Change questionnaires to CDP.
CDP formerly known as the Carbon Disclosure Project houses a comprehensive database based on voluntary, self-reported data on sustainability actions and indices.
It is important to remember that CDP Climate Change Questionnaires are based on the GHG Protocol, which suffers from the same limitations in use listed above.
We’ve created a comparison chart to help visualize the differences.
Investors also misuse ad-hoc indices partially based on CDP data or similar:
We have made much progress in developing a common language, frameworks, and indices to tackle the challenge of climate change across organizations worldwide.
However, it is important to understand the limitations of the current systems and metrics, which although well-intentioned, frequently fall short in assessing the massive contribution of Scope 3 emissions, particularly around upstream supply chains.
1 Green, J. F. Private standards in the climate regime: the greenhouse gas protocol. Bus. Polit. 12, 1–37 (2010)
2 Matthews, H. S., Hendrickson, C. T. & Weber, C. L. The importance of carbon footprint estimation boundaries. Environ. Sci. Technol. 42, 5839–5842 (2008)
3 Blanco, C., Caro, F. & Corbett, C. J. The state of supply chain carbon footprinting: analysis of CDP disclosures by US firms. J. Clean. Prod. 135, 1189–1197 (2016).