Scope 3 emissions are indirect greenhouse gas (GHG) emissions that occur both upstream and downstream of an organization’s value chain. As opposed to scope 1 and scope 2 emissions, which occur from sources that are owned or controlled by an organization, scope 3 emissions are indirect emissions resulting from value chain activities.
Assessing the relevancy of all fifteen scope 3 emissions categories can be intimidating. However, with growing regulatory requirements and customer expectations, this is becoming an increasingly mandatory step for companies on their sustainability journey.
Many companies are facing regulatory, reputational, and investor pressures to increase their reporting transparency around scope 3 emissions. Understanding GHG emissions across a company’s entire value chain provides clarity as to where the emission hotspots are and where inefficiencies in the value chain may exist. A rigorous scope 3 inventory allows tracking of year-over-year emissions and highlights the effect of any operational changes on emissions or success of any decarbonization methods.
For companies who have or plan to set science-based targets, this knowledge can be used to prioritize decarbonization strategies, such as
Investigating the sustainability performance of suppliers and across procurement
Encouraging the innovation of more energy efficient products
Engaging with employees to reduce emissions associated with travel and commuting
Engaging with customers to inspire environmental consciousness
Other emission reduction strategies
Aside from regulatory compliance, any of these actions may advance a company’s climate strategy and positively affect its outward impact on the communities and environments in which it operates.
ADEC ESG completed a scope 3 inventory for a global plastics manufacturing company. This information allowed our client to develop a better understanding of the availability of plastic feedstock data within its supply chain and provided a catalyst for a deeper dive into supplier production processes, including a comparison of efficiency and feedstocks. The data provided also helped our client establish a foundation for setting a science-based target.
Client: Plastics Manufacturing Company
Location: Global
Project Results and Deliverables:
Our team developed a full scope 3 GHG inventory for a global Fortune 100 IT company using the most relevant and up-to-date methodologies, emission factors, and data available. The inventory identified the activities which created the most significant emissions within the company’s value chain, which encouraged our client to improve supplier and customer emissions reduction engagement. Our team also assessed the company’s dependency on third parties and their impact on climate goals, and provided guidance on how to navigate the most prevalent decarbonization challenges within our client’s industry.
Client: Fortune 100 Information and Communication Technology Company
Location: Global
Project Results and Deliverables:
ADEC ESG completed a full scope 3 GHG inventory for a large food and beverage company operating worldwide. First, our team developed a detailed boundary definition to promote understanding of the company’s supply chain and key activities, identify priorities, and ensure the inclusion of every significant source of emissions. We then initiated engagement between key stakeholders across global operations, opening up communication pathways and ensuring that data was standardized, consistent, and shared. The final inventory helped our client to develop an understanding of global transportation mapping in order to improve data systems and drive efficiency—for example, results highlighted a need to map suppliers of certain raw materials and track their use of recycled content. The inventory also provided a foundation for our client to begin setting a science-based target.
Client: Fortune 500 Food and Beverage Company
Location: Global
Project Results and Deliverables:
ADEC ESG developed a full scope 3 GHG inventory for an apparel and footwear company based in the U.K. The project involved assessing the carbon intensity of certain materials compared to others, providing an opportunity for intentional design changes that would have a sizeable impact on our client’s overall emissions. The work also highlighted the benefits of circularity from an emissions perspective, which was a priority for our client. Our team then compared the results with previous years’ scope 3 inventories to identify gaps in data quality and completeness, as well as drive the improvement of data collection systems.
Client: Apparel and Footwear Company
Location: United Kingdom
Project Results and Deliverables:
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