Carbon Management and Carbon Footprinting
Carbon Management is a process that involves reviewing, quantifying, tracking and reporting the activities of a company in terms of Carbon emissions, aiming to identify, control and reduce emissions over a period of time.
Carbon is a catch all term used to describe the different gasses that contribute to global warming. Carbon Dioxide is the main gas and non-Carbon Dioxide gasses are quantified in terms of their global warming effect relative to Carbon dioxide, which is why it is standard practise to refer to the management of Green House Gasses, as Carbon management.
In order to manage Carbon, first it needs to be measured and accounted for. This is done by completing a GHG Inventory or Carbon Footprint. A Carbon Footprint is divided into 3 categories which are dealt with differently and are designed so that all emissions are accounted for and there is no duplication of emissions reported by a company. These are:
- Direct Carbon emissions (Scope 1) caused by activities such as burning natural gas to generate heat, and indirect emissions
- Indirect Carbon emissions (Scope 2 and 3) where the emissions are outside of the control of the company. Indirect emissions are separated into those emissions related to:
- the generation of energy known as Scope 2 (electricity, heat etc) and
- those emitted within the supply chain (Scope 3). There are 15 sub-categories of Scope 3 emissions as defined by the GHG Protocol, which take account of items purchased (upstream emissions) and those sold (downstream emissions).
So, what are the main steps to develop a Carbon footprint?
- Understand the reasons for undertaking a Carbon Footprint
The drivers and goals could be to understand the risks and opportunities, identify Carbon hot spots, set reduction targets, engage suppliers and employees, improve corporate reputation or comply with stakeholder expectations.
- Review what should be included in the Footprint
There are accounting principles that need to be followed which would ideally follow the companies financial accounting principles of activities, controlled (financial or operational) or equity share.
- Review the scope 3 sub-categories to identify which to include.
Scope 1 and 2 emissions will always be included in a Carbon Footprint. Scope 3 categories need to be considered and a realistic approach needs to be taken to ensure the footprint is able be completed, as some information is time consuming and costly to produce with margin benefit. The principles of footprinting are relevance, completeness, consistency, transparency and accuracy.
- Organise the data into an inventory.
It is important to produce the data in a way that it is able to be repeated (as it is likely that an annual update will be performed) and could be reviewed and validated by a third party.
- Create a full Carbon Report that aligns to the GHG Protocol and ISO14064.
It is common for sections of the Carbon report to be used in other Sustainability reports and disclosures, which would be reviewed at the beginning of the process.
for more information or support on Carbon Footprinting, we’d be delighted to hear from you 😊.