Carbmee's blog on corporate climate action, scope 1, 2, 3, Scope 3.1 emission calculation, and ESG reporting.

Explore a curated selection of our resources designed to empower your journey toward sustainable transformation, from insightful blogs and thought-leading webinars to in-depth whitepapers and in-person events.

Expertise to drive sustainable transformation

Knowledge & Insights about carbon footprint managemnt

In an era where environmental responsibility is crucial, most companies commit to reduction targets, yet do not know how to actually tackle their Scope 3 emissions. Measuring, reporting, and reducing Scope 3 emissions is both a completely new and highly complex challenge. Supply chain decarbonization is still in its early stages and there is an escalating demand for solutions. 89% of companies are using or currently searching for a Scope 3 digital solution, meaning they want to manage their emissions with software, not with service providers.

carbmee is a recognized vendor of carbon management software with a strong commitment to developing and providing a software solution that will empower companies to get their carbon under management. It is carbmee's vision to drive the sustainable transformation of businesses with environmental intelligence to achieve net-zero by 2050. Therefore, it comes as no surprise that carbmee is incorporating all technological advancements to stay at the forefront of carbon management innovation. Whatever technological possibilities exist, carbmee will incorporate the latest innovations into the software, constantly improving the product and using every tool available to empower companies to achieve net zero. While specifically focusing on improving sustainability, carbmee is among other technological start-ups that aim to revolutionize supply chain management with AI.

carbmee´s cutting-edge software enables businesses to measure, reduce, and report emissions in their supply chain with unparalleled accuracy and efficiency. Through advanced data matching techniques with generative AI, carbmee is able to provide granular emission data for massive amounts of data at speed, ensuring precise tracking and management of carbon footprints.

Tackling Scope 3 emissions with intelligent software solutions

carbmee has integrated Gen AI into its carbon accounting software to revolutionize how businesses manage their emissions. Here’s how carbmee stands out:

Gen AI enables carbmee to match customer data with emission data from comprehensive databases such as Ecoinvent. This process ensures that emission data is highly accurate and specific to each item, providing businesses with detailed insights into their carbon footprint.

A key aspect of carbmee’s approach is to focus on excelling at data matching and modeling processes while relying on strong partners like ecoinvent to provide the best emission data. With this clear objective, carbmee´s software solution outperforms in data matching, delivering highly accurate footprint calculations. Gen AI-driven data matching enables companies to measure, report, and reduce their emissions as efficiently and effectively as possible.

Generative AI can handle vast amounts of data efficiently, making it suitable for big data applications. By using generative AI, big bulks of data can be processed efficiently in carbmee EIS™,  enabling the system to provide granular emission data for all items in the supply chain. It is only with this level of detail and granularity that businesses can meet stringent sustainability targets and regulatory requirements.

GenAI models understand the context around data points, leading to more accurate matches. The precision of generative AI in data matching leads to highly accurate emission reports. This accuracy helps companies make informed decisions about their supply chain operations, ultimately contributing to more effective carbon reduction strategies.

Tracking Scope 3 emissions presents several challenges, including inconsistent data sources, varying emission factors, and a lack of standardized methodologies. carbmee’s generative AI addresses these issues by providing:

Consistent Data Integration: carbmee´s incorporated AI ensures seamless integration of data from multiple sources, maintaining consistency and accuracy.

Standardized Emission Factors: Using comprehensive databases like EcoInvent, carbmee standardizes emission factors across the supply chain.

Real-Time Data Insights: The speed of Gen AI data processing and its processing power to handle massive amounts of data, leads to real-time data insights in carbmee EIS™. It enables companies to make timely decision-making.

Overcoming Challenges in Scope 3 Emissions Tracking

carbmee’s innovative use of generative AI in its carbon management software marks a significant advancement in the fight against climate change. By ensuring accurate, granular emission data, carbmee empowers businesses to take effective action towards reducing their carbon footprints. As the world moves towards stricter environmental regulations and greater sustainability demands, technologies like generative AI will be crucial in achieving these goals. The integration of generative AI into carbon accounting is just the beginning. As AI technology evolves, its applications in sustainability will expand, offering new ways to optimize supply chains and reduce emissions. Exciting AI-powered developments in carbmee EIS™ for analysis, forecasts, and scenario modeling are in the making already - stay tuned.

Leading the sustainability transformation with AI-powered climate tech

The complexity of tracking Scope 3 emissions requires powerful solutions. Gen AI significantly contributes to achieving emission data precision and reliability. Learn how Gen AI fuels data matching in carbmee EIS™.

Gen AI Enhances Scope 3 Emissions Tracking with carbmee EIS™

Discover how carbmee uses Generative AI for precise Scope 3 emissions tracking. Learn about enhanced data matching and accuracy for supply chain decarbonization.

Leveraging Generative AI for Supply Chain Decarbonization with carbmee EIS™

The European Union Deforestation Regulation (EUDR) is a new law aimed at reducing the EU’s role in global deforestation and forest degradation. Coming into force on 30 December 2024, it applies to companies placing specific products on the EU market or exporting them from it.

Seven high-risk commodities fall under the regulation:

It also includes a broad range of derived products, such as chocolate, leather, furniture, books, and packaging materials.

To comply, companies must ensure that their products are:

Deforestation-free, based on land use after 31 December 2020

Legally produced, according to local laws in the country of origin

Accompanied by a Due Diligence Statement (DDS), which must include verifiable geolocation data for the plots where commodities were produced (European Commission)

From 30 December 2025, enforcement begins in full — at which point companies must prove that all relevant products meet these criteria (White & Case).

Deforestation is responsible for about 11% of global greenhouse gas emissions — more than the emissions of all global passenger vehicles combined. Forests are essential carbon sinks, and their destruction severely undermines efforts to limit global warming.

For manufacturers committed to net-zero targets or ESG reporting under frameworks like CSRD, eliminating deforestation from supply chains isn’t optional — it’s essential. EUDR compliance directly supports science-based emissions reduction targets and long-term climate resilience.

The EUDR applies to all companies — large and small — that operate in or trade with the EU and handle regulated commodities. It makes no difference whether you are:

Exporting out of the EU to other markets.

The regulation has significant implications for manufacturing companies in sectors such as:

Food & Beverage (e.g., chocolate, coffee, dairy, meat),

Packaging and Paper (e.g., cartons, print products),

Automotive and Transport (e.g., leather or rubber components),

Chemicals and Consumer Goods (e.g., palm oil-based ingredients in cleaning or cosmetic products).

Whether you're at the top of the supply chain or closer to the consumer, if your products contain any EUDR-listed raw materials, you're in scope.

Sustainability – accountable for environmental performance and ESG reporting

Procurement – responsible for due diligence, supplier engagement, and risk data

Supply Chain – tasked with traceability, logistics, and supplier relationships

Legal & Compliance – ensuring regulatory alignment and handling enforcement risk

Executive Leadership – owning strategy, risk, investor relations, and growth

The EUDR touches virtually every department in companies with global value chains — and is especially relevant in manufacturing industries that rely on agricultural, forest-based, or natural raw materials. According to industry estimates, the regulation impacts trillions of euros in trade across these sectors

The EUDR is legally binding and backed by serious enforcement powers. Non-compliance isn’t just a reputational issue — it’s a direct business risk.

Companies may face fines of up to 4% of their annual EU turnover, as well as product confiscation and permanent exclusion from the EU market (Deloitte). These penalties apply not only to products linked to deforestation, but also to failures in documentation — such as missing or incorrect DDS filings.

Authorities have the power to block shipments at the border. Even a single non-compliant farm plot can result in an entire container or batch being denied entry — a risk made real by findings that 2% of farm plots show signs of deforestation and 1% have legality issues.

For manufacturers with just-in-time supply chains, blocked shipments can lead to factory downtime, missed orders, and broken SLAs. The risk is particularly high in commodity-dependent sectors like cocoa, soy, and palm oil.

While the cost of compliance is manageable, it is not negligible. For large companies, EUDR implementation is expected to cost around 0.1% of revenue and 1.45% of operating profit. For SMEs, this rises to 0.17% of revenue. Early investment in systems and supplier collaboration will reduce long-term costs and risks.

Plot-level geolocation and legality verification cannot be retrofitted overnight. Supply chain mapping, particularly in tier 2–3 regions, requires early and sustained supplier engagement.

Last-minute preparation could lead to shipment blocks, supply shortages, and customer dissatisfaction — particularly for EU-bound production runs and critical components.

Demonstrating compliance early will not only reduce risk, but strengthen supplier relationships and enhance brand equity with environmentally conscious consumers and investors.

1. Conduct a Risk-Based Supply Chain Assessment

Identify which commodities and suppliers are in scope

Map out geographies with known deforestation or legal compliance risks

Begin collecting required documentation and geolocation data

Use technology such as GIS, satellite imaging, or blockchain to track commodity origins

Integrate with procurement and ERP systems for real-time verification

Create cross-functional governance involving Legal, Sustainability, Procurement, and Supply Chain

Appoint EUDR leads to own the transition roadmap and reporting

4 important steps companies must take now

The EUDR is not just a compliance problem — it is a strategic priority that intersects with revenue protection, risk management, and ESG leadership.

With up to 4% of EU turnover at risk and the possibility of exclusion from one of the world’s largest markets, EUDR demands board-level attention.

Institutional investors and regulators now expect companies to demonstrate climate and nature-related risk mitigation — including deforestation.

Failure to adapt now could result in raw material shortages, operational standstills, and long-term competitive disadvantage.

EUDR compliance positions your brand as a responsible, forward-looking leader — a critical asset in stakeholder-driven markets.

The EU Deforestation Regulation (EUDR) is set to reshape global trade and supply chain practices — and it’s approaching fast. For manufacturing companies operating in or trading with the EU, it marks a regulatory shift with significant operational, reputational, and financial implications.

This guide outlines what EUDR is, who’s affected, what’s at stake, and what your organization should be doing right now to prepare.

EUDR – What It Means, Who Is Affected, and Why You Must Act

Today's companies are increasingly hearing and heeding the warning calls of climate change experts. Everyone strives to understand what factors like the greenhouse gas protocol and Scope 1, 2, & 3 emissions mean for their business and how to ensure compliance.

Multinational companies like BP, Coca-Cola, and Walmart account for nearly a fifth of global CO₂ emissions – with the majority of those emissions to be found in their supply chain. As companies become more aware of their environmental impact, it’s clear that organizations' supply chains often account for more than 90% of their greenhouse gas (GHG) emissions. But what does that even mean?

Nearly everything a company does can be understood through the lens of carbon – that is to say, its activities, products, and purchases all have an amount of greenhouse gas emissions allocated to them. So how do companies know what is essential to measure, or how even to quantify the emissions of everything they do? This is where the Greenhouse Gas Protocol comes into play.

We have developed this guide to help organizations understand the GHG Protocol and accompanying emissions to help do their part in compliance and stewardship. 

The GHG Protocol is a comprehensive standardized framework for measuring and managing emissions from private and public sector operations, value chains, products, cities, and policies. Originally established in 1988 as a partnership between the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), the purpose of the GHG Protocol is to help businesses everywhere account for the subtle and potentially drastic changes in our future related to greenhouse gas emissions. It has become the most widely recognized and used standard for measuring all three emissions scopes.

What Is the Greenhouse Gas (GHG) Protocol?

In the GHG Protocol, the Corporate Standard categorizes the primary GHG emissions into three distinct Scopes: Scope 1 emissions, Scope 2 emissions, and Scope 3 emissions. 

Scope 1 emissions are direct emissions created by owned or controlled sources. Scope 2, or indirect emissions, stem from the generation of purchased energy, and Scope 3 emissions are all indirect emissions. These take place in the value chain for each reporting company and include upstream and downstream emissions. 

How Is the GHG Protocol Related to Scope Emissions?

Not all GHG emissions are the same. There are various categories that businesses, government bodies, and organizations must consider to ensure complete awareness and ultimate reduction. Gaining a better understanding and more insights into each scope helps businesses succeed in reducing emissions. 

GHG Scopes 1, 2, & 3 are emissions categories defined by the GHG Protocol. Each scope is used by organizations, government bodies, and regulators to set goals and targets to reduce carbon emissions and other chemical greenhouse gases damaging the environment. Each scope is distinguished by the degree of control a business or organization has over the emission source rather than by emission type.

Scope 1 Emissions: Direct Emissions

Scope 1 emissions are direct greenhouse gas emissions from sources owned or controlled by an organization (i.e., direct emissions from company facilities and vehicles). They include boiler and furnace emissions, transportation emissions, and chemical production emissions from owned or controlled processes. All this means that emissions are released into the atmosphere directly from the company's daily activities.

Scope 1 emissions reporting is mandatory. 

Scope 2 Emissions: Indirect Emissions (Owned & Not-Owned)

Scope 2 emissions come from electricity, steam, heat, and cooling consumption (i.e., indirect emissions from purchased energy to turn on the lights in your office). The energy consumption counted for Scope 2 emissions are related to the end-user, indirectly owned by corporations. 

Scope 2 emissions are also mandatory to report.

Scope 3 Emissions: Indirect Emissions (Not-Owned)

Scope 3 emissions are naturally complex since they are linked not only to a company’s value chain but also to its entire product life. Scope 3 emissions are companies' most common and significant source of emissions. It refers to GHG emissions that result from the company's activities. However, the company has no direct control over the resulting emissions. 

Also known as "value chain" emissions, Scope 3 GHG emissions are part of the cost of doing business. Here are some examples of Scope 3 emissions: 

Emissions from waste disposal or incineration 

Emissions from business travel, whether via air, train, boat, or automobile

Emissions from the extraction of raw materials used in manufacturing

Emissions from the manufacturing of products used by the company

Emissions from the downstream usage of products or services

While organizations must report Scope 1 and Scope 2 emissions, Scope 3 reporting is optional. However, it is highly encouraged to account for and report these emissions since they account for 70% of the total GHG footprint. Of course, these emissions are more challenging to detect, record and report, but they are a vital component toward reaching net-zero targets in the future. 

Scope 3 emissions are referred to as upstream or downstream depending on where they initiate in the value chain. 

Let's start with a closer look at Scope 3 emissions with upstream emissions. These types of emissions come from goods and services that a business buys or otherwise acquires: 

Purchased goods and services have a cradle-to-gate carbon impact, meaning they have an emissions impact from the moment of production until the moment it arrives at a store or other sales space. The reporting company must also account for the extraction, production, and transportation of services or goods purchased, leased, or otherwise acquired. 


Capital goods, sometimes called capital assets, also have a cradle-to-gate impact. The upstream impact of capital goods comes from their extraction, production, and transportation upon purchase or acquisition by the reporting company. 


Fuel and energy-related activities that do not fall under the same activities listed in Scope 1 or Scope 2. These activities derive from the extraction, production, and transportation of energy and fuels acquired or purchased by the reporting company. Here is a breakdown of the different categories of this particular Scope 3 upstream activity: 
- Upstream emissions of purchased fuels consumed by the reporting company. 
- Upstream emissions of purchased electricity with the extraction, production, and transportation of fuels used when generating electricity, steam, and heating and cooling used by the reporting company. 
- Transmission and distribution (T&D) losses result from generating electricity, steam, heating, and cooling and are reported by the end user. 
- Generation of purchased electricity, steam, and heating and cooling is later sold to end users and reported by a utility company or energy retailer. 


Upstream transportation and distribution or emissions from transportation via air, road, rail, sea, and third-party transportation or related to storage. These upstream activities might include: 
- Transportation and distribution of products purchased by the reporting company for its operations or between tier 1 suppliers in vehicles and facilities owned by someone other than the reporting company. 
- Transportation and distribution services by the reporting company, focusing on inbound and outbound logistics and transportation and distribution between businesses' different facilities.


Waste disposal and treatment in a reporting company's operations in facilities not owned or controlled by the reporting company. Waste matters might include wastewater, landfill, or composting.


Business travel by air, bus, rail, or rental car specifically for business-related activities during a reporting year in vehicles not owned or operated by the reporting company.


Employees commute activities between their homes and worksites by car, rail, bus, air, subway, or teleworking.
 

Upstream leased assets or operation of assets, such as assets from energy use, are those leased by the reporting company, known as the lessee, distinguishing them from assets included in Scope 1 and Scope 2 emissions.

Scope 3 downstream activities are more challenging to assess and report because they involve product consumption and focus on the consumer. 

Let's look at some examples of downstream activities for Scope 3 emissions. 

Downstream transportation and product distribution activities occur when the manufactured items are no longer in the reporting company's possession. While they are still responsible for producing and distributing those products, the consumer now creates more emissions from the product. The downstream activities occur via air, road, rail, sea, and third-party shipping and storage products. 


The processing and use of sold products, such as a car motor, and what the end user does with them daily. 


End-of-life treatment of sold products is when a consumer has finished using the product, whether the product wore out its usefulness or they bought something new. What is the waste-disposal emissions factor? Was the product incinerated, recycled, or is it in a waste heap?


Downstream leased assets - While some leased assets fall under Scope 1 or Scope 2, most fall under Scope 3 as downstream concerns. This area is challenging because it is difficult to account for leased items because of varying possession. However, it is still a downstream activity and more challenging to monitor and report.


Franchises - This category applies to franchisors who must account for emissions from the operation of franchises not included in Scope 1 or 2.


Investments and financial institutions may involve Scope 1 and 2 emissions classifications related to organizational boundaries related to equity-share investments. Scope 3 becomes a factor when considering the emissions of Scope 1 and 2 investees.

Downstream activities are challenging to measure, but they represent a holistic and realistic overview of a product's complete life cycle and carbon impact, from production to retirement and disposal.

Interested to know more about CSRD guidelines? Download our CSRD guide

Since Scope 1 and 2 emissions are mandatory to report, companies have focused on GHG emissions from their operations. But what about the emissions happening outside their walls?

If companies ignore Scope 3 emissions — those linked to the company’s operations but not owned by them — they miss out on a crucial step towards successful decarbonization.

Why? Scope 3 emissions often represent the most significant production of greenhouse gases. And they are also the hardest to measure since they are outside the company’s operations and direct control. In fact, the CDP has found that supply chain emissions (read: Scope 3) are, on average, 11.4 times higher than operational emissions. 

Despite the challenges, it is worth the effort to measure and report all three scopes to reduce your business's carbon footprint as much as possible. 

What Scope 3 Means for Your Business's C-Suite, Stakeholders, and Board

While most GHG Protocols have similar end goals in reducing chemical emissions, there is more than one way to achieve them for different sectors. Let's explore the seven different types of GHG Protocols. 

The GHG Protocol Corporate Accounting and Reporting Standard, or the Corporate Standard, was designed for companies and governmental organizations. It provides guidance and requirements for bodies such as government agencies, NGOs, and universities leading up to a corporate-level GHG emissions inventory. 

Here are some additional benefits of this GHG Protocol: 

It helps companies prepare for an upcoming GHG inventory to ensure that the results accurately reflect their emissions with standardized principles and approaches.

It reduces the cost of the GHG emissions inventory.

It provides information to help build an effective corrective strategy to manage and reduce future emissions. 

It increases transparency and consistency in accounting and reporting. 

This GHG Protocol is compatible with other GHG programs, but it is essential to distinguish the Corporate Standard from other programs when completing the reporting process.

2. Corporate Value Chain Standard (Scope 3) 

Companies can quickly assess their value chain emissions with this Scope 3 Emission Standard, or the Corporate Value Chain Standard. The results identify the value chain emissions impact to allow companies to identify the spots where they can reduce emissions activities. 

The Product Standard, also known as the Product Life Cycle Accounting and Reporting Standard, is used to grasp a specific product's complete life cycle of emissions. This information allows the company to focus efforts on more significant emissions reduction.

This Protocol is the most comprehensive and is known fully as the GHG Protocol for Project Accounting. It offers a policy-neutral accounting tool to help businesses identify and quantify the value and benefits of GHG reduction and climate change mitigation projects. 

This Protocol is a partnership between WRI, C40 Cities Climate Leadership Group, and Local Governments for Sustainability (ICLEI). Together, these bodies formed the GHG Protocol for Cities (GPC) as a robust framework for accounting and reporting on city-wide GHG emissions.

This standard, designed for cities, focuses on cities offering an excellent opportunity to tackle climate change at the ground level. It allows city GHG leaders to identify and measure the source of emissions to cut problems at the root. The GHG Protocol offers cities specific tools and standards to measure emissions, build reduction strategies, and set measurable emission reduction goals. 

The Greenhouse Gas Protocol Mitigation Goal Standard offers information and guidance to design national and subnational emission mitigation goals. It also provides a standardized approach to assessing, reporting, and working toward goals.

It will help governments, companies, and organizations to

Determine and set emission-reduction goals

Meet international and domestic emissions reporting responsibilities to groups such as NFCCC

Track the progress of emissions-reduction results 

The GHG Protocol Policy and Action Standard is a standardized protocol and approach for organizations to estimate the GHG effect of actions and policies. This Protocol works at local and national levels, allowing respective leadership to assess the GHG impacts of specific policies. It offers a guideline for improving emissions-reduction effectiveness and informs responsible policymakers about where to invest resources to improve and get the best results. 

For several decades, leading scientists have understood the growing need for concern and action regarding the increasing amounts of greenhouse gases, including methane, carbon dioxide, and nitrous oxide. These and other synthetical chemicals trap the Earth's outbound energy, which means that the heat remains in the atmosphere with no place to go.

These substances trapped inside the Earth's atmosphere change the Earth's radioactive balance of energy received via the sun and emitted from the Earth. Together, this energy stalemate has the power to alter the Earth's climate and weather patterns, regionally and globally. 

Greenhouse gas emissions have historically been associated with naturally occurring factors, such as the Earth's orbit, the sun's output, the carbon cycle, and volcanic activity. However, scientific experts have found an increasing amount of emissions are related to human and industrial activities since the 1700s, particularly over the past 50 years.

When combined, these factors have negatively impacted the Earth's radiative balance. This imbalance has led to a warming effect surrounding various aspects of the Earth's climate, such as ocean temperatures, sea levels, and surface air. 

Without deliberate and coordinated corrective action from leading businesses and worldwide governmental organizations, the imbalance invites vulnerabilities to human health, wildlife, agriculture, water resources, forests, and coastal regions. 

Why Has the GHG Protocol Become So Important?

Businesses ready to commit to reducing emissions and eventual carbon neutrality needs a direct path to success. This complex issue relies on scientific-and-fact-based information and guidance that the GHG Protocol delivers and expands upon to ensure success. 

The Protocol provides the world's most easily understood and widely used GHG accounting standards for businesses everywhere. The standards and guidance make it simple for participating companies to monitor, measure, manage, report, and potentially mitigate GHG emissions from their operations or supply chains.

As of 2016, 92% of Fortune 500 companies had already adopted and regularly used the GHG Protocol and its standards for compliance, whether indirectly or directly, via a GHG Protocol-based program. 

Some reports indicate that many countries have reduced greenhouse gas emissions, helping to keep the Earth's temperature rise below 1.5 degrees. This success has led to more and more cities worldwide committing to using and relying on the GHG Protocol. 

Further, an increasing number of countries are adopting the GHG Protocol on a national level since it offers a strategy to mitigate emissions problems by assessing and reporting progress toward respective goals and estimating the effects of GHG Protocol policies and actions. 

The fact is that while large corporations and retailers bear a great responsibility, so do all organizations. It is a social responsibility that everyone in commerce should acknowledge and address to the best of their abilities, and the GHG Protocol offers everyone a simple set of guidelines. It is as beneficial for companies to adopt and use the GHG Protocol as it is for the environment. It shows their commitment to reducing their carbon footprint and carbon neutrality. 

As more and more leading companies develop a GHG policy, they have a massive influence on the public consciousness worldwide, so other companies are paying attention regardless of their size and reach. Competitors will undoubtedly have to consider following suit or lose the faith of consumers and leadership devoted to protecting the Earth as a home and bed of resources.

Why Is the GHG Protocol Important for Companies?

All businesses interested in a net-zero future want to find the most straightforward and least disruptive ways to reduce emissions. The GHG Protocol offers all this and more, including the following benefits:

It provides an easy path to reducing Scope 1, 2, & 3 emissions. 

It keeps businesses competitive among those adopting the GHG Protocol. 

It shows consumers that each business and its leaders adopting the GHG Protocol care about the effects of climate change and the will to do what's right to protect the Earth and its resources.

It promotes more transparency, consistency, and quality for corporate GHG accounting and reporting duties via standardized approaches, principles, and activities, ensuring complete and consistent compliance with standards set forth by governing bodies.

Four Business Benefits of Using the GHG Protocol

According to a July 2022 Forbes article from Shivaram Rajgopal, the GHG Protocol, the most widely used framework used to measure and report emissions globally, continually seeks to enhance and improve efforts. 

In 2023, the WRI intends to make necessary updates, which might include matters such as:

Mechanism to report emissions regarding acquired or discontinued operations

Clarification on Scope 4 or avoided emissions 

Ideally, the work in 2023 will help clear up current limitations but considering that the GHG Protocol is still relatively new and an ongoing concern, look for experts to continue seeking improvements. 

While all emissions scopes are essential to measure and report, it takes special tools and strategies to pin down Scope 3 downstream emissions. Our solution can help you track your GHG accounting and accurately measure your GHG reduction without the stress of trying to fill in the gaps. 

carbmee has designed, developed, and refined a cloud-based GHG Protocol solution to support your efforts to measure carbon, manage emissions, and achieve your carbon reduction and net-zero carbon goals. 

Contact us to learn more about our offerings, determine your strategy, or book a demo today! 

Let carbmee Help You Develop a GHG Protocol Strategy

GHG Protocol: What Are Scope 1, 2, & 3 Emissions?

The GHG Protocol is the most widely recognized standard for measuring and managing greenhouse gas emissions from private and public sector operations.

EUDR with carbmee – From Ideation to Implementation

The CSRD marks a watershed moment for corporate sustainability with far-reaching implications for how companies assess their own climate impact, as well as for the future of sustainability reporting in both Europe and globally. Organizations will need to devote significant time and resources to prepare for implementation of the directive within a short timeframe.

We’ve created a quick guide to help industry enterprises understand the most important points of the CSRD and how they can best prepare for it.

Corporate Sustainability Reporting Directive

The Corporate Sustainability Reporting Directive (CSRD) is an amendment and extension of the current Non Financial Reporting Directive (NFRD), under which large companies, banks and insurance companies with more than 500 employees are required to disclose information on their environmental and social impacts. The European Commission adopted a proposal for a CSRD in April 2021, with the aim of improving the quality of sustainability reporting and increasing transparency on the non-financial performance of companies for external stakeholders.

As the climate crisis has progressed, the EU is increasing its efforts to drive forward its transition to a sustainable economy. The CSRD strengthens the existing rules on non-financial reporting introduced in the Accounting Directive by the 2014 non-financial reporting directive (NFRD). The new regulations under the CSRD will bring important changes regarding scope and reporting requirements.

The scope of companies affected by the regulations will significantly be extended to apply to: 

All large companies, that is companies fulfilling 2 out of the three following criteria:
- Revenues surpassing EUR 40 million per year
- Total assets over EUR 20 million
- More than 250 employees

All companies listed on EU-regulated markets (except listed micro-enterprises)

This nearly quadruples the number of companies required to publish reports on the environmental and social impacts of their operations from 11,700 to about 50,000. 

What are the main differences between the CSRD and the existing NFRD? 

The CSRD will include more comprehensive sustainability reporting requirements and significantly expand the number of EU and non-EU companies subject to the EU sustainability reporting framework. Enterprises will provide detailed environmental and climate change information, but will now also be held accountable for reporting on a wider range of topics such as environmental rights, social rights, human rights, and governance factors.

The CSRD is mandatory for companies that meet in-scope criteria, which include: 

EU companies with over 250 employees and a net turnover of EUR 40 million

Non-EU companies with at least one subsidiary in the EU and a net turnover of more than EUR 150 million

Reporting requirements for the CSRD will be fully phased in before the end of the decade as follows:

reporting in 2025 on the financial year 2024 for companies already subject to the NFRD

reporting in 2026 on the financial year 2025 for large companies that are not currently subject to the NFRD

reporting in 2027 on the financial year 2026 for listed SMEs (except micro undertakings)

reporting in 2029 on the financial year 2028 for third-country undertakings with net turnover above 150 million in the EU if they have at least one subsidiary or branch in the EU exceeding certain thresholds.

To comply with the CSRD, companies will need to prepare a non-financial statement that includes information on their sustainability policies, risks, and results. This statement must be auditable by an independent third-party and be included in the company’s annual financial report.The specific content of the statement will vary depending on the size and sector of the company but could include policies and performance details, such as: 

a brief description of the company’s business model, strategy and sustainability risks and opportunities; 

implementation plans as they relate to the transition to a sustainable economy, measures taken to achieve climate neutrality by 2050 ( in line with the Paris Agreement), and exposure to coal, oil and gas-related activities;

double materiality, i.e. both the sustainability matters that affect the company and the impact of the company on the environment, market, and people; 

greenhouse gas emission reduction targets; 

policies in relation to sustainability (including incentive schemes); 

and the processes the undertaking used for due diligence in relation to sustainability issues, as well as the current and future negative effects of the business' operations and value chain.

Corporate Sustainability Reporting Directive (CSRD):Quick Guide

What is the Corporate Sustainability Reporting Directive? What will it mean for your industry? How can your enterprise prepare for compliant reporting? Check out our quick guide to find out.