Written by Graham Paul – Service Delivery Director
With over twenty years of experience in the energy sector, Graham leads service delivery, sales and marketing to enhance customer experience and scale TEAM’s carbon and energy services with a data‑driven, outcomes focus.
Organisations reporting greenhouse gas emissions may soon experience significant changes to how carbon accounting is approached worldwide. As we explored in our latest Market Briefing, the Greenhouse Gas Protocol (GHG Protocol) and the International Organization for Standardization (ISO) have confirmed plans to combine their corporate carbon accounting standards into a single global carbon accounting framework.
The proposed standard will bring together the GHG Protocol’s Scope 1, Scope 2 emissions and Scope 3 emissions standards, alongside the Actions and Market Instruments (AMI) standard and ISO 14064-1.
While the long-term objective is to simplify carbon accounting and improve consistency between organisations, one area likely to receive significant attention is Scope 3 emissions reporting.
Why Scope 3 Emissions Matter
For many organisations, a Scope 3 emission footprint represents the largest proportion of their total greenhouse gas impact. Unlike Scope 1 and Scope 2 emissions, which relate to direct operations and purchased energy consumption, Scope 3 emissions encompass indirect emissions occurring throughout the value chain, including purchased goods and services, business travel, transportation, waste, and the use of sold products.
As reporting expectations continue to increase through investor requirements, sustainability frameworks, and emerging regulations, organisations are facing growing pressure to understand and report their full Scope 1, 2 and 3 emissions profile.
However, Scope 3 reporting remains one of the most challenging aspects of greenhouse gas accounting.
The Current Challenge with Scope 3 Reporting
Many organisations struggle with:
- Collecting reliable supplier data
- Estimating emissions where primary data is unavailable
- Applying consistent calculation methodologies
- Managing large volumes of value chain data
- Demonstrating transparency and assurance.
The coexistence of multiple carbon accounting frameworks can add further complexity, particularly for multinational organisations seeking consistency across different markets and reporting programmes.
By combining the world’s most widely used carbon accounting standards into a single framework, ISO and GHG Protocol aim to create a more integrated and consistent approach to greenhouse gas accounting. The initiative is intended to simplify reporting, reduce duplication and improve comparability across jurisdictions.
What Could the Unified Standard Mean for Scope 3 Emissions?
Although the detailed requirements are still under development, the inclusion of the GHG Protocol’s Scope 3 standard within the consolidated framework suggests future guidance may become more closely aligned with broader corporate reporting requirements.
For organisations reporting Scope 1, 2, and 3 emissions, potential benefits could include:
Greater Consistency: A single global standard may reduce interpretation differences between organisations, creating a more consistent approach to measuring and reporting Scope 3 emissions.
Improved Data Quality: Clearer methodologies could help organisations strengthen data collection processes across supply chains, improving the quality and credibility of reported emissions.
Reduced Reporting Complexity: Many organisations currently navigate multiple frameworks and reporting expectations. Harmonisation may reduce duplication and streamline reporting activities.
Better Comparability: Investors, customers and regulators increasingly require comparable sustainability information. A unified framework could make benchmark comparisons more meaningful.
The Growing Link Between Scope 2 and Scope 3 Emissions
The announcement also included updates relating to ongoing Scope 2 standards development and consultation feedback. GHG Protocol reported receiving nearly 1,100 responses from 56 countries relating to the future treatment of renewable electricity purchases and electricity emissions accounting.
While Scope 2 emissions and Scope 3 emissions are often discussed separately, the two are becoming increasingly interconnected within broader corporate decarbonisation strategies. Improvements in electricity procurement, renewable energy sourcing and supplier engagement can influence emissions performance across multiple reporting categories.
As organisations seek to demonstrate progress towards net zero targets, understanding these connections will become increasingly important.
Preparing for Future Changes
The unified standard remains under development, and organisations should continue following existing reporting requirements until further details are announced.
To prepare, organisations should consider:
- Reviewing current Scope 3 emissions calculations and methodologies
- Engaging suppliers to improve data quality
- Strengthening energy and carbon data management processes
- Identifying areas where estimates can be replaced with primary activity data
- Ensuring governance processes support accurate reporting and assurance.
Organisations that establish strong foundations now are likely to be better positioned as carbon accounting standards evolve.
Looking Ahead
The proposed unified standard represents one of the most significant developments in corporate carbon accounting for many years. By bringing together existing requirements for Scope 1, Scope 2 emissions and Scope 3 emissions into a single globally recognised framework, ISO and GHG Protocol aim to simplify reporting while improving consistency and transparency.
Read more about the ISO and GHG Protocol Unified Carbon Accounting Standard