Climate action is an imperative for all businesses, from small start-ups to multinationals. The first step is understanding your impact by measuring your emissions.
As a carbon accounting software provider, focusing on the highest-emitting sectors and supply chains, we work with major global companies and financiers to track and tackle their emissions.
We also have a responsibility to be transparent about our carbon footprint. It builds trust among our investors and customers, giving them insight into their own scope 3 emissions, climate risks and reduction opportunities.
Read on for how we calculated CarbonChain’s emissions. We also share 4 tips for companies looking to measure theirs.
For FY20-21 (Financial Year 2020-2021):
- Our carbon footprint was 31.5 tCO2e (tonnes of carbon dioxide equivalent)
- That’s just under 4 tonnes of CO2e for every full-time employee
- Nearly all of our emissions were scope 3 emissions
See our full FY20-21 emissions report
As a carbon accounting company, we have a wealth of specialist in-house expertise. Our experienced Carbon Emissions Analyst led the quantification of our corporate footprint.
Reporting period: We founded CarbonChain in 2019. This is our first corporate carbon footprint, which covers FY20-21 (October 1st 2020 to September 30th 2021), a year that saw fast growth of our headcount, office space and supplier base.
Scopes: To undertake a full corporate carbon footprint, we set out to include our emissions across all scopes:
- Scope 1 (emissions from our owned or controlled sources)
- Scope 2 (emissions from purchased or acquired energy)
- Scope 3 (all other indirect value chain emissions)
Standards and frameworks: Our approach is aligned with the GHG Protocol’s Corporate Accounting and Reporting Standard and Value Chain (Scope 3) Standard — the globally recognized best-practice standards for corporate carbon accounting.
We started by defining the boundaries of CarbonChain’s footprint. This involved setting the overall organizational boundary (i.e. which emissions are directly caused by CarbonChain?) and the supply chain boundaries (which emissions sources in the rest of our value chain are relevant?). We used the operational control approach to consolidate our emissions sources. This is the most appropriate and commonly used approach for companies of our nature.
TIP #1: To help determine which scope 3 emission sources are relevant for your carbon footprint, use the 5 relevancy criteria outlined in the GHG Protocol Corporate Value Chain Accounting Reporting Standard as guidance (Table [6.1], p61).
We collected data from various sources, including (but not limited to) our facilities, employee surveys, supplier reports and company procurement spend. From there, we used the methodologies outlined below for our calculations and analysis.
TIP #2: Using supplier-specific data in your carbon footprint increases accuracy and helps you see exactly where emissions could be reduced. However, obtaining emissions reports directly from all suppliers can be extremely challenging. Start by asking those who are most likely to contribute significantly to your corporate footprint. Even if they don’t have the capability yet, it will send them a signal that customers are seeking carbon data.
We then calculated our emissions using a methodology hierarchy. We prioritized supplier-specific emissions data, then activity data (e.g. distance traveled, waste generated, water consumed, electricity consumed, etc.) and lastly spend-based data to estimate emissions.
To calculate emissions intensity, we divided our footprint by the number of full-time employees (FTE). This lets us estimate the change in our footprint as our team continues to rapidly grow, and as we implement measures to reduce our emissions.
Tip #3: The spend-based approach can be a starting point for estimating corporate scope 3 emissions, but over time data improvements should be implemented in order to use better quality data to estimate emissions (such as activity data or supplier-specific emissions reports).
It’s important to note that our baseline FY20-21 carbon footprint isn’t representative of a business-as-usual year, due to the Covid-19 restrictions barring us from working in the office together or traveling internationally.
We’re committed to calculating our corporate carbon footprint on an annual basis, and publicly and proactively reporting it. We’ll also:
- Re-baseline our carbon footprint in FY21-22 and have this validated by an independent third-party;
- Prepare an emissions reduction plan in order to meet our SME Climate Hub goal of halving our emissions by 2030 and reaching net zero by 2050 at the latest;
- Update our net-zero target to 2040;
- Continue investing in high-quality offsets to compensate for our residual corporate emissions. For FY20-21, we have purchased and retired an equivalent number of offsets to neutralize our corporate carbon footprint.
Tip 4: All businesses should make a public commitment to net zero. Small and medium-sized businesses can join the SME Climate Hub, and large companies should set a science-based target. See our guidance on science-based targets here.
Are you in the commodities industry or a trade finance provider?
CarbonChain can accurately measure and track your supply chain or portfolio emissions, helping you tackle climate risk and reduce your carbon footprint. Get in touch to book a demo.