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May 18 2023

Carbon Accounting Simplified: The Why, How and What of Carbon Accounting

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Carbon Accounting Simplified: The Why, How and What of Carbon Accounting

As the world grapples with the climate crisis, there's an increasing need for organizations to get a handle on their greenhouse gas (GHG) emissions. Enter carbon accounting – a concept that's quickly becoming the new normal in corporate sustainability reporting. But what exactly is it, and why should you care? Let's break it down.

The Why of Carbon Accounting

You can't manage what you don't measure. That's the core premise behind carbon accounting. By quantifying your GHG emissions accurately, you can track progress towards your climate targets, identify emissions hotspots, and prioritize reduction efforts accordingly.

But it's not just about ticking boxes. Governments, investors, and consumers are increasingly demanding transparency and accountability on climate action. Carbon accounting enables you to demonstrate your commitment to playing a part in the global fight against climate change.

The What of Carbon Accounting

So, what is carbon accounting? It's the practice of calculating an organization's total GHG emissions across its operations and value chain. This involves identifying emission sources, collecting data on emission-generating activities, applying emission factors, and aggregating the results to determine your overall carbon footprint.

It covers direct emissions from sources you own or control (Scope 1), indirect emissions from purchased energy (Scope 2), and other indirect emissions across your value chain (Scope 3).

The How of Carbon Accounting

Implementing robust carbon accounting typically involves these key steps:

  • Define organizational and operational boundaries
  • Identify emission sources (Scope 1, 2, and 3)
  • Collect data on activities that generate emissions (e.g. energy use, transportation, etc.)
  • Apply appropriate emission factors to calculate emissions from each activity
  • Aggregate emissions data and report results transparently

It's a data-intensive process, but one that yields valuable insights into your environmental impact and opportunities for improvement.

By optimizing your operations and supply chain through carbon accounting, you can cut costs, boost efficiency, and gain a competitive edge – all while future-proofing your business against tightening regulations and shifting consumer preferences.

The sustainability landscape is riddled with complexities and contradictions, but carbon accounting offers a path forward – one grounded in transparency, accountability, and science-based decision-making.

Don't wait for stakeholders to nudge you. Embrace robust carbon accounting now, and position your organization as a leader in the transition to a low-carbon future. It's time to demystify this concept and make it a core part of your climate strategy.

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