Preparing for local and international regulatory reporting requirements

Understanding your Scope 3 emissions across all 15 categories

With heightened regulatory, investor, and consumer pressures, companies are facing questions on the measurement, methodologies and management of scope 3 greenhouse gas (GHG) emissions, in accordance with the Greenhouse Gas Protocol. As defined in the Greenhouse Gas Protocol, Scope 3 emissions encompass all indirect emissions (not included in Scope 1 or Scope 2) that occur in the value chain of a company, including both upstream and downstream emissions.

For financial service organizations, Scope 3 accounts for 99.98% of total emissions. 

Thinking about your entire carbon footprint, Baringa’s has developed a 5-step emissions journey outlined and discussed in more detail below. 

Baringa’s Scope 3 Playbook describes a practical approach to get started on your emissions management across all 15 scope 3 categories. 

Our customizable Scope 3 playbook can be used for different types of advisory support we offer, ranging from:

1.    Definitions and impact assessment 
2.    Data sources and stakeholders
3.    Calculation methodologies 
4.    Implementation approaches  

For all 15 scope 3 categories, Baringa’s Scope 3 Playbook addresses:

Definition and impact

In addition to providing GHG protocol aligned definitions, our Scope 3 playbook provides tailored insights to inform your approach, agnostic of company sector or geographical profile. 

 
_{Example of Category 1 Definition & Insights}

    Data sources & stakeholders

Getting a handle on emissions data is a critical and challenging task for any company. In our Scope 3 playbook, we explore available data sources and emissions factors, as well as key stakeholders to participate in the data collection process. This will enable an enterprise-wide approach to embed emissions management into existing business and reporting routines.

_{Example of Category 1 common data sources}

  Calculation Methodologies 

For each of the scope 3 categories we explore available calculation methodologies to inform your approach on what is aligned to your company’s profile and data availability.
 
_{Example of Category 1 analysis of calculation options}

   Implementation approaches

For each category  in the scope 3 playbook, we have included example calculations to demonstrate how to translate the metrics and methodologies to understand and measure your emissions across each category. 
 
_{Example of Category 1 calculation method}

Baringa’s customizable Scope 3 Framework

An emissions management framework is imperative for organizations. Our framework can be customized and built on your existing capabilities to align to regulatory compliance (eg., CA), and ultimately maximize the value for your organization.

Our framework is customizable based on your company’s sector and value chain to enable an adaptable and pragmatic approach to meet various use cases.

1. Regulatory disclosures – Compliance with U.S. federal, national and local laws that is aligned with industry standard based on international regulatory requirements (e.g., ISSB, TCFD, CSRD)
2.  Emissions management – Strategic approach to carbon accounting, supply chain enhancements, or investment/lending portfolios
3.  Business decision making – Legal entity, business, and Board-level reporting to inform strategic planning efforts

To learn more about how Baringa can help on your scope 3 emissions journey, please reach out to Carolanne Boughton, Melissa Klimek, or Ryan Bohn.