The fight against climate change is more than ever a priority for companies. Between increasingly stringent regulations, consumer expectations and investor demands, measuring and reducing one’s carbon footprint has become essential. While Scope 1 and Scope 2 are well understood and integrated into carbon footprints, Scope 3 often remains a major challenge. Yet Scope 3 accounts for the majority of a company’s emissions. What is Scope 3? How is it measured? Why is it so crucial? And above all, how can we take concrete action to reduce it?
Scope 3 definition: origin and history
Birth of the concept with the GHG Protocol
The concept of Scopes 1, 2 and 3 was introduced by the Greenhouse Gas Protocol (GHG Protocol), an international framework established in the early 2000s to standardize the accounting of greenhouse gas (GHG) emissions. The aim was to enable companies and organizations to accurately identify their emissions sources and implement effective reduction strategies.
International standards and regulations
Over the years, several international regulations and standards have incorporated the Scope 3 concept:
- ISO 14064 standards: define the principles of GHG emissions accounting. At WILL, we use this standard to calculate your corporate carbon footprint.
- CSRD (Corporate Sustainability Reporting Directive, EU): obliges large companies to report their emissions, including Scope 3.
- SEC (Securities and Exchange Commission, USA): imposes similar obligations on listed companies.
- SBTi (Science Based Targets initiative): encourages companies to set targets in line with the Paris Agreement, including ambitious reductions in Scope 3. In particular, the SBTi movement enables companies to target net zero 2030/2050.
Why are we talking so much about Scope 3 today?
While Scope 1 (direct emissions) and Scope 2 (emissions linked to purchased energy) are well under control, Scope 3, which encompasses all indirect emissions linked to a company’s value chain, is often neglected. Yet it can account for up to 90% of an organization’s total emissions. Companies that really want to achieve carbon neutrality must therefore tackle it seriously.
What is Scope 3?
Explanation of the three scopes
Scope 1
Scope 1 covers all greenhouse gas (GHG) emissions directly generated by the company’s activities. These are emissions sources that the company owns or controls, mainly linked to the combustion of fossil fuels. These include
– The gasoline or diesel consumed by a delivery company’s fleet of vehicles.
– The combustion of natural gas in the boilers of a manufacturing plant.
Scope 2
Scope 2 covers indirect emissions generated by the production of energy consumed by the company. These emissions come from suppliers of electricity, heating or cooling, and are highly dependent on the energy mix used in the region.
– Electricity purchased by an office building and used to power computers, lighting and air conditioning.
– The steam used by a factory, produced by a coal-fired power station.
Scope 3
Scope 3 covers all other indirect emissions associated with the company’s activities, but which do not fall under Scope 1 or Scope 2. These come from the entire value chain, i.e. suppliers, customers, partners and even investments made by the company. Scope 3 emissions are often the largest and most complex to quantify, as they cover a wide range of activities outside the company’s direct perimeter. They include, among other things, the manufacture of purchased raw materials, the transport of goods, the use of products sold and their end-of-life.
Presentation of the 15 Scope 3 categories
Scope 3 is divided into 15 categories, grouping upstream and downstream emissions:
Upstream (before production or use) :
1. Goods and services purchased
2. Fixed assets (e.g. equipment and infrastructure)
3. Fuel and energy-related activities not included in Scope 1 and 2
4. Upstream transport and distribution
5. Waste generated by operations
6. Business travel
7. Employee commuting
8. Upstream leased assets
Downstream (after production or sale) :
9. Downstream transport and distribution
10. Treatment of products sold at end-of-life
11. Use of sold products
12. Treatment of waste related to products sold
13. Downstream leased assets
14. Franchises
15. Investments
The infographic below gives a visual presentation of scope 3, from the perspective of the 15 emissions categories it includes.
Why should a company measure its Scope 3?
Regulations and compliance
With increasing carbon disclosure requirements (CSRD, SEC, SBTi), companies must now measure and report their Scope 3 emissions to meet the expectations of the authorities and the market.
Pressure from investors, customers and stakeholders
Investors increasingly favor companies committed to reducing GHG emissions. What’s more, customers and consumers are paying close attention to the environmental impact of the products and services they buy.
Integrating Scope 3 into Net Zero and ESG strategies
Reducing Scope 3 is a key lever for achieving carbon neutrality objectives and improving our ESG (Environmental, Social and Governance) score.
Other benefits
- Sustainable positioning and offering of a range of eco-responsible products and services
- Reduced operating costs (optimized transport, better waste management, energy efficiency)
- Improved supply chain resilience
- Access to new markets and business opportunities
- Building a sustainable business ecosystem, based on both economic and ESG synergies between its stakeholders.
How do I calculate my company’s Scope 3 emissions?
Identification of relevant emission sources
Not all companies are covered by the 15 Scope 3 categories. So it’s important to identify those that have the greatest impact in your sector.
Available tools and methodologies
- GHG Protocol: international reference methodology
- Bilan Carbone®: approach used in France and Quebec
- Emissions databases (official emission factors, LCA, etc.)
Hiring a carbon expert
Scope 3 calculations can be complex. Solutions Will offers turnkey support to help you identify, measure and reduce your Scope 3 emissions effectively.
How can I reduce my organization’s Scope 3 emissions?
Short-term equities
- Supply chain optimization (eco-responsible suppliers, short supply chains)
- Eco-design of products (recycled materials, longer product life)
Long-term strategies
- Supply chain transformation (switch to renewable energies, low-carbon innovations)
- Circular economy and reuse of resources
Carbon financing and offsetting
Despite our best efforts, some emissions are unavoidable. By purchasing certified carbon credits, we can offset these emissions while supporting local environmental projects.
Scope 3 challenges and limits
Lack of precise data and difficult traceability
Access to supplier and partner data is often limited.
Dependence on suppliers
A company cannot directly control the emissions of its supply chain, but it can influence its partners.
Emerging solutions
- Using blockchain to improve traceability
- New regulations encourage greater transparency
Author and editor of the article
Raphaël Pittavino-Varitto
Digital Marketing and Communications Manager
In short, Scope 3 is a major challenge for companies wishing to make a real commitment to the ecological transition. Rather than seeing it as a constraint, it can be an opportunity for innovation, optimization and competitive differentiation. Contact Will Solutions for personalized, structured support on the road to carbon neutrality.