what i’ve learned helping companies do their first ghg reporting

Feb 22

published 2.22.23

Accounting for your organization’s greenhouse gas emissions for the first time can be daunting. While it might feel like you aren’t ready to disclose and shine a light on your environmental impact, taking the leap into environmental transparency is one of the best things you can do in today’s climate (pun intended) for your corporate reputation.

For starters, tracking your annual emissions signals to stakeholders that your company is environmentally conscious.

From a business perspective, leaning into transparency and accountability can be your competitive edge.

From a “do the right thing” perspective, understanding your footprint is essential to making informed business decisions that have a meaningful impact on the environment.

As governments and regulators worldwide continue to implement net-zero policies, the timing is now to understand what it takes to complete your emissions inventory.

Here are 5 things we recommend to our clients to make this process a little bit easier -, and a lot less intimidating:

You might not have access to all the data you need (yet), and that’s OK.
If you own your office space or have access to your utility bills, it can be relatively straightforward to trace your emissions from heating and electricity use. However, as more companies are closing their doors in favor of remote work and co-working spaces, this might be more difficult to track down. WeWork, for instance, estimates that they will receive over 1,000 requests this year for data on their energy, water, and waste use. Monitoring systems are currently being developed to properly track utility consumption - but we expect these processes will take time to develop. While your vendors improve their data collection process, most companies opt to use estimations, like the average electricity consumption per square foot.
Over time data quality is expected to improve, but for now, this is the norm.
Consider time vs. accuracy trade-offs.
To be as precise as possible in your emissions accounting, you’ll need accurate data, which can take a very long time to download. The trade-off of time for accurate data might not be worth your resources. If it takes hours to download records of employee office check-ins, it might make sense to use average occupancy rates instead to calculate commuting emissions. If your organization is running into problems like this, many clients will stick with estimations or averages.
Moving forward, you will now understand how to improve internal systems for better data organization. Undergoing this process each year will progressively yield better results.
Conducting an inventory can help uncover gaps in other internal processes.
Undergoing the process of emissions accounting can highlight risks and opportunities related to your internal tracking systems. It could reveal bad data entries, duplication, or even invalid data. This “dirty” data can pose security risks by falsely influencing decision-making.
After going through an emissions inventory and realizing your data lacks consistency, this could be your sign to revamp your internal tracking systems.
Don’t be overwhelmed by scope 3 emissions (if you already are, you’re not alone).
The GHG protocol, the standard for greenhouse gas accounting, has 15 sub-categories of Scope 3 emissions – and 50+ methodologies to estimate these emissions. With so many business activities to account for, it can be confusing where to start. Most companies start by disclosing a combination of these scope 3 categories: 1) business travels, 2) cloud providers, 3) employees working from home, and 4) employees commuting. Since it might not be feasible to track down all emissions in the value chain (e.g., distribution, capital goods, end-of-life use – to name a few), initiating these requests from vendors is a crucial step in making this information become more accessible over time.
What’s more, influencing other companies to become more transparent about their environmental impact is a major milestone.
Get comfortable with the uncomfortable *cough* estimations *cough*.
The molecular diameter of CO2 (our main culprit) is 3.34 × 10−8 cm. Given that we’re calculating emissions on a yearly basis, the margin for error is considerable. Although it goes against financial accounting practices, companies need to embrace uncertainty. Shying away from conducting an emissions inventory because it lacks accuracy is a big mistake. All companies are using estimations to some degree. Because this process is relatively new to everyone, it will take time to become standardized.

The best thing you can do for your business is to start early so that you can understand the process of accounting and implement changes to improve over time. Learn where your data tracking challenges lie and consider how internal systems can be improved.

To set up a consultation call with one of our in-house greenhouse gas emissions accounting experts, drop us a line.