Greenhouse Gas Accounting: benefits & added value

What is Greenhouse Gas accounting?

GHG accounting is the process of measuring, tracking, and managing the greenhouse gas emissions produced by a company’s operations and value chain. These emissions are categorised into three groups: 

• Scope 1: Direct emissions from sources owned or controlled by the company (e.g., fuel combustion in company vehicles, emissions from on-site production facilities). 
• Scope 2: Indirect emissions from purchased electricity, steam, heating, and cooling. 
• Scope 3: Indirect emissions occurring in the upstream and downstream value chain, such as supplier activities, product use, transportation, and waste disposal. 

By understanding where emissions originate, companies can take targeted action to reduce their carbon footprint, improve operational efficiency, and build a more sustainable business model.

Why invest in GHG Accounting?

Implementing GHG accounting is not just about compliance - it’s about unlocking business value. The benefits go beyond sustainability and directly impact costs, risk management, and brand reputation. 

• Gain deeper business insights 
  A company cannot manage what it does not measure. GHG accounting provides critical data-driven insights into how your business operates, revealing patterns and inefficiencies that would otherwise go unnoticed. These insights enable smarter decision-making and better resource allocation. 
• Identify cost-saving opportunities 
  One of the biggest advantages of GHG accounting is the ability to pinpoint inefficiencies in energy use, transportation, and supply chain management. By identifying emission hotspots, you can optimise your processes, reduce energy costs, and lower operational expenses. This leads to direct financial savings while also reducing environmental impact. 
• Stay ahead of regulations and avoid future compliance risks 
  Regulatory frameworks for carbon reporting and emissions reduction are tightening globally. The European Union (EU), in particular, has committed to achieving climate neutrality by 2050, a goal that requires all companies operating within its jurisdiction to significantly reduce their greenhouse gas (GHG) emissions. To support this transition, several EU regulations already require businesses to measure and report their carbon footprints, either at the corporate or product level (for instance, the EU Emissions Trading System, the EU Battery Regulation, the Ecodesign for Sustainable Products Regulation, etc.). Even if GHG disclosure is not yet mandatory for your company, preparing now can prevent future compliance headaches. Being proactive means avoiding fines, maintaining investor confidence, and staying competitive in a rapidly changing market.
• Strengthen brand reputation and meet stakeholder expectations 
  Consumers, investors, public buyers, employees, and business partners are increasingly demanding transparency on environmental impact. Companies that measure and disclose their emissions demonstrate accountability and leadership, strengthening their brand and building trust with key stakeholders. This is becoming increasingly important in public procurement, where carbon footprint considerations are often included in the selection criteria.  
  Larger companies, particularly those in scope of the CSRD, are increasingly requesting GHG accounting data from smaller organisations in their supply chain to calculate their own footprint. This expectation is also reflected in the Voluntary Small- and Medium-Sized Enterprises (VSME) reporting standards. Finally, sustainability commitments can also attract top talent, as employees are more likely to choose companies that align with their values. 
• Enhance supply chain resilience & business futureproofing 
  Supply chains are vulnerable to climate risks such as extreme weather, resource scarcity, and regulatory changes. GHG accounting helps businesses assess supply chain emissions, identify at-risk suppliers, and take proactive measures to improve resilience. By integrating sustainability into your supply chain decisions, companies can ensure long-term stability and competitiveness. 

How does GHG accounting work?

Step 1: defining organisational and operational boundaries 

• Determine which emissions to account for across Scope 1, 2, and 3. 
• Establish whether emissions should be reported based on operational control, financial control, or equity share - depending on the reporting framework used. 

Step 2: identifying emission sources 

• Map out all GHG emission sources within direct operations and along the value chain. 
• Consider factors such as energy consumption, transportation, waste, purchased goods, and product use. 

Step 3: collecting data

• Gather relevant activity data such as fuel usage, electricity consumption, logistics data, and production outputs. 
• Ensure data quality by standardising collection processes and using verified sources. 

Step 4: calculating emissions & converting to CO₂e 

• Apply internationally recognised emission factors. 
• Convert raw data into CO₂-equivalent (CO₂e) emissions for reporting and comparison.

Get started today

Understanding and managing your emissions is about more than mere compliance. It’s a strategic business move that drives efficiency, cost savings, and long-term value.

Want to explore how GHG accounting can benefit your business? 
Interested in starting to set up GHG Accounting for your organisation but don’t know where to start?