Green Export Compliance Field Notes Vol.3 | You account for your own Scope 3 — and you are someone else’s Scope 3 data source
[AI Summary] An organizational GHG inventory answers “how much did this company emit in a year"; a product carbon footprint answers “how much did this product emit across its life cycle". They differ in object, boundary and time frame, and must not be mixed. Scope 3 — indirect value-chain emissions — is usually the largest share of a company’s footprint and the easiest to get wrong: double counting in Category 3, Category 2 spikes from capital purchases, confusing upstream and downstream transport, and spend-based factors used in the wrong context. For exporting factories there is another side: the product carbon footprint you hand to customers becomes the data source for their Scope 3 Category 1.
Key takeaways
- Five differences between organizational and product carbon — and how both can share one set of activity data.
- The most common Scope 3 mistakes and how to fix them.
- How supplier factories can go from “being chased for data" to being a data source customers trust.
First, get the difference straight: organizational vs product carbon
| Aspect | Organizational GHG inventory | Product carbon footprint |
|---|---|---|
| Object | The whole company or organization | A single product or service (functional unit) |
| Boundary | Organizational boundary (equity share or control approach) + operational boundary (Scopes 1, 2, 3) | The product life cycle: raw materials, manufacturing, transport, use, end of life |
| Time frame | A reporting period, usually a calendar year | The product life cycle, with no direct link to a reporting period |
| Common standards | GHG Protocol, ISO 14064-1 | ISO 14067, PCR/PEFCR, ISO 14040/14044 |
| Question answered | How much did the company emit this year? | How much did this product emit? |
The two must not be mixed, but they can share one set of activity data: a factory’s fuel, electricity, material and output data feed both Scopes 1 and 2 of the inventory and the manufacturing stage of the product footprint (see Vol.1, “one data foundation, two rule engines").
Why does Scope 3 matter so much?
- Scale: Scope 3 covers 15 upstream and downstream categories and is usually far larger than a company’s own Scopes 1 and 2.
- Target thresholds: under SBTi’s near-term criteria, companies whose Scope 3 is 40% or more of total emissions must also set a Scope 3 target.
- Customer requirements: global brands and supply-chain leaders now build supplier carbon data and reduction performance into supplier scorecards.
- A dual role: in a global supply chain you account for your own Scope 3 and are also a data source for your customers’ Scope 3.
