A research paper on Scope 3 Climate Reporting has just been released, marking a significant step forward for those concerned about climate impact.
What is Scope 3?
It’s all about the indirect emissions linked to a company’s activities, not just what they emit directly. This includes emissions from things like the materials they buy, the transportation of their products, and even how customers use and dispose of their products. These Scope 3 emissions can be a whopping 80% of a company’s total emissions!
This study sheds light on the complexities of Scope 3 emissions and uncovers major challenges in the current state of Scope 3 reporting, including issues with data quality, consistency, and the broad discretion in reporting methods. However, it’s not all daunting.
Key finding
The authors of the research paper suggest focusing on the most significant emission sources for each industry, making it easier to track and improve these emissions. This method could simplify the reporting process, improve data accuracy, and ensure better comparability across different companies and sectors.
Importance
Yes because it provides a roadmap for shaping a sustainable future. This is a call to leverage this new understanding to inform decision-making and advocate for more transparent and effective climate reporting strategies.
You can read the paper here: https://www.lseg.com/en/ftse-russell/research/solving-scope-3-conundrum
Thanks to David Harris at the London Stock Exchange Group for the heads-up.