Why Am I Responsible for Scope 3 Emissions?

Companies are increasingly held accountable for scope 3 emissions, which encompass all indirect emissions that occur in the value chain related to their business, including both upstream and downstream activities. These emissions often represent the largest share of a company's carbon footprint: a 2022 CDP report found that, on average, Scope 3 accounts for 75% of a company’s emissions.

Companies are responsible for their scope 3 emissions because they have influence over their supply and value chains and can take action to reduce those emissions. Companies can mitigate scope 3 emissions through strategic procurement, product design, investment decisions, and other business choices. Addressing these emissions is crucial for minimizing environmental impact, achieving sustainability goals, and responding to the increasing demands for greater transparency and accountability from stakeholders.

As regulatory environments tighten and market pressures increase for sustainable practices, companies ignoring scope 3 emissions may face legal, financial, and reputational consequences. Investors, customers, and regulatory bodies are increasingly scrutinizing companies’ efforts to reduce their total carbon footprint, making the management of scope 3 emissions not just a matter of environmental responsibility but also a strategic business imperative. By taking responsibility for these emissions, companies can demonstrate leadership in sustainability, improve their competitive advantage, and contribute meaningfully to the global effort to combat climate change.