As sustainability becomes a priority for businesses worldwide, calculating carbon emissions become vital for companies from the professional services industry. This industry includes companies such as legal, accounting, financial, IT consulting, marketing and advertising agencies, and more. They are facing an increasing demand from clients to disclose their carbon footprint. Further, we explore the process of carbon accounting and how companies can effectively measure and reduce their carbon footprint.
Recent trends indicate that clients are demanding professional service firms’ Environment, Social & Governance (ESG) information, including carbon emissions. Between October 2022 and March 2023, one global law firm received 50 requests to share its ESG data. Thomson Reuters Institute’s report identified ESG as one of the top three risks for in-house lawyers.
Understanding Carbon Accounting
To comply with regulatory requirements and client expectations, services provider firms need to understand how to calculate carbon emissions. The process, known as carbon accounting, involves assessing emissions across three scopes: Scope 1, Scope 2, and Scope 3.
Scope 1 Emissions: Scope 1 emissions originate from activities under a firm’s control. Since most firms from the professional services industry are typically office-based, their direct emissions are relatively low. These emissions mainly arise from fuel and gas consumption within the building, as well as from refrigerants and fugitive emissions.
Firms primarily generate their emissions through Scope 2 and 3 categories. Scope 2 emissions are indirect and result from purchased energy, such as electricity. Scope 3 emissions include factors like business travel, commuting, and purchased goods and services.
Key Factors in Calculating Carbon Emissions
Calculating GHG emissions can be complex, but breaking it down into sub-components and focusing on data collection can simplify the process.
Scope 1 and 2: Professional services firms can utilize metered or sub-metered data from utility bills or purchase records to quantify Scope 1 and 2 emissions. If these records are unavailable, estimating emissions based on regional square footage can be an alternative approach.
Scope 3: For Scope 3 emissions, firms can obtain travel data from corporate travel agencies or expense management systems. Commuting and remote work emissions can be gathered through employee surveys. If data from providers is inaccessible, external databases like the Intergovernmental Panel on Climate Change (IPCC) can serve as valuable resources.
Efficient data gathering for carbon accounting requires the collaboration of multiple departments within a firm. The real estate, facilities, and operations teams collaborate with building management to obtain vital data on utilities, water, and waste. The procurement and finance function plays a crucial role in tracking spending within the supply chain to gather Scope 3 emissions data. The IT group contributes to emissions management by providing insights on data centers, energy usage, and life-cycle assessments. Additionally, human resources departments assist in collecting commuting data, conducting surveys, and determining remote work emissions, ensuring comprehensive data collection and accurate carbon accounting.
Process of Calculating Carbon Emissions
Once data from Scope 1, 2, and 3 sources is collected, a company can combine the emissions. However, understanding which emission factors to apply can be challenging. Some emission factors can be found on the websites of organizations such as the Environmental Protection Agency (EPA) and the IPCC.
Embracing Continuous Improvement: As the need for carbon emissions data disclosure grows, service provider firms must strive for continuous improvement in their calculations. By prioritizing areas with significant emissions, such as travel, law firms can focus on reducing inefficiencies and waste over time.
Your Company’s GHG Management One Stop Solution
At Sustainable Scenario, we are specializing in providing comprehensive greenhouse gas (GHG) accounting and reporting services. As sustainability and environmental responsibility become paramount for businesses, we understand the importance of accurately measuring and reporting carbon emissions to meet regulatory requirements and stakeholder expectations.
Sustainable Scenario offer tailored solutions to assist your organization in effectively calculating and reporting its GHG emissions. Our team of highly skilled experts is dedicated to helping you navigate the complex landscape of carbon accounting, ensuring compliance, and unlocking opportunities for sustainable growth.
Our GHG Accounting and Reporting Services include:
- Emission Inventory Development: We will work closely with your team to identify and quantify emission sources, collecting relevant data and utilizing industry-leading methodologies to develop a comprehensive GHG emission inventory.
- Carbon Footprint Assessment: Our experts will calculate your organization’s carbon footprint across scopes 1, 2, and 3, considering direct and indirect emissions. We will provide you with a detailed analysis and actionable insights to guide your emissions reduction strategies.
- Reporting and Disclosure: We will assist you in preparing accurate and transparent GHG emissions reports, aligning with international standards such as ISO 14064, the Greenhouse Gas Protocol, and industry-specific frameworks. Our goal is to help you effectively communicate your environmental performance to stakeholders and fulfill reporting obligations.
- Training and Capacity Building: We understand the importance of building internal capacity for ongoing GHG management. Our training programs will equip your team with the knowledge and skills needed to track and manage carbon emissions effectively, fostering a culture of sustainability within your organization.
Partnering with Sustainable Scenario you can:
- Gain a clear understanding of your organization’s carbon footprint.
- Meet regulatory requirements and fulfill stakeholder expectations.
- Identify opportunities for emissions reduction and operational efficiency.
- Prepare your company for ambitious targets such as SBTi or Carbon-Neutrality
- Enhance your reputation as an environmentally responsible organization.
- Demonstrate leadership in sustainability and stay ahead of industry trends.
Take the first step towards a greener future by contacting us at info@sustainablescenario.com. Our team will be delighted to discuss your specific needs and provide you with a customized solution.