Many countries worldwide are committing to the global goal of achieving net-zero emissions by 2050. A crucial element in reaching this goal is for companies around the world to track and report their carbon and greenhouse gas emissions.  

Some governments require large corporations to report their emissions. In other areas of the world, reporting greenhouse gas emissions remains optional. Many companies, both large and small, choose to monitor and report their carbon footprint to satisfy customers and investors who are looking to engage with environmentally responsible businesses.  

Some small business owners have concerns about how they can participate in tracking the emissions of their business operations, while others express an interest in participating in a green future. As small business owners continue to ask questions about ways to participate in measuring their carbon footprint, more resources can be provided for firms that wish to participate.  

We’ll cover the reasons why businesses should measure their emission patterns. We’ll also explore the suggested methods for how companies can begin measuring these metrics and in what areas of business these emissions can be found. Then, we’ll look at how some big business sectors are responding to the issue of carbon emissions and what concerns and resources small businesses have. 

Why Should Businesses Measure Their Carbon Footprints? 

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When businesses measure their carbon footprint, they can begin to understand where the majority of their emissions come from. Once these emissions are recognized, companies can take action to mitigate the amount of carbon their operations produce.  

A reduction in carbon emissions is good for the environment. Global warming can be slowed as more businesses track their emission patterns and take steps to mitigate their carbon footprint.  

Not only does measuring and reporting carbon emissions help firms to preserve the state of the environment, but it can also improve business operations and, in some cases, is mandatory for larger organizations.   

Plus, many customers and investors are looking to engage with business operations that employ environmentally sustainable practices.  

In the U.K., a survey of 500 adults between 18 and 25 found that 57% of these individuals would stop purchasing products from a company that refused to measure and reduce its carbon footprint. When asked about loyalty to a brand, 55% said they would continue engaging with brands that made an effort to reduce their greenhouse gas emissions.  

Investors also place value on businesses that are clear about the sustainability of their business practices. These investors consider environmental data when looking into companies they might buy stock in. Environmentally responsible companies appear to have less risk because they are more prepared to adapt to changing business regulations and resource scarcity.  

The practice of government mandated emissions reporting places pressure on large companies; the public can view the trend of their emissions. Companies now have a greater incentive to report the lowest emission numbers possible, improving their status among the masses.  

As the global opinion on sustainable business practices continues to trend toward supporting businesses that understand their environmental impact, organizations of all sizes should consider tracking their carbon footprint to please their client base and investors and ensure they remain within the regulations of local law. 

How Can Businesses Measure Their Carbon Footprints? 

Businesses can develop a greenhouse gas inventory to measure their carbon emissions. The Greenhouse Gas Protocol Corporate Standard exists to aid corporations in understanding greenhouse gas accounting principles, locating emission sources, and studying emission trends over time.  

Other tools also exist for businesses like the EPA’s Center for Corporate Climate Leadership, which has developed a four-step protocol to help enterprises start measuring their emissions:  

Organizations should understand their emission accounting practices, define the boundaries of their business operations, and select a year from which they can study information moving into the future. 
Next, businesses should collect data about their emission trends. 
Businesses should then create an inventory management plan that documents the data collected. 
Finally, the data can be publicly reported through voluntary or mandatory programs, and the business can set a target to reduce greenhouse gas emissions in the future. The emission trends should be monitored over time as the company strives to meet its emission goal. 

How Are Emission Sources Defined in Business Operations? 

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Emission sources are broken into three scopes within a business’s operation chain. These scopes are defined so companies can track the location of their greenhouse gas emissions and adapt their operations to reduce their carbon footprint.  

Each emission scope is defined as follows:  

Scope 1 emissions occur as a direct result of business operations. For example, businesses that have fossil fuel burning vehicle fleets are directly responsible for the carbon emitted through burning those fossil fuels. 
Scope 2 emissions result from an organization’s purchase of energy (e.g., electricity, heat, or air conditioning) created through a process that results in greenhouse gas emissions. For example, power generated through burning coal that a company then purchases is a scope 2 emission. Because the company uses this energy, they are responsible for reporting the emissions caused when it was created. 
Scope 3 emissions do not result from a business’s direct practices. These emissions are caused by other entities within a business’s value chain. Scope 3 emissions for one business can be the scope 1 and 2 for another business. For example, a company that manufactures goods would have scope 3 emissions due to a company that ultimately disposes of those goods. 

Most companies’ emissions occur in scope 3, with 65% to 95% of a business’s carbon footprint resulting from greenhouse gas emissions in this scope.  

Currently, it is optional for businesses to report their scope 3 emissions. It is, however, essential for organizations to begin documenting their scope 3 emissions because this is where the most significant reductions in carbon release can occur. 

How Are Big Businesses Measuring and Reducing Their Carbon Footprints? 

Larger corporations, like Apple and ExxonMobil, have started releasing scope 3 emissions data. Other corporations are working within their supply chain to develop collaborative efforts between businesses to report these emissions.  

Even outside of supply chains, companies have started to work together. Competitors in the same sector have started forming coalitions to address the measurement of their carbon footprints. Since these companies often share manufacturers and supply services, they have decided to address the issue together.  

Other companies are taking on environmental sustainability in a different way.  

Companies in the agricultural sector have committed to activities like lowering greenhouse gas output, recycling, and providing resources and knowledge to smaller agricultural companies looking to go green.  

Many of the leading auto manufacturers contribute by producing cars that are sustainably assembled and have better fuel efficiency. Others are developing vehicles with alternative fuel sources or investing in clean energy projects.  

The major companies in the retail, manufacturing, and software sectors all have taken steps toward reducing their carbon footprint in various ways. From running on clean energy to using recycled material for manufacturing products, many large corporations are developing more sustainable business practices. 

How Can Small Businesses Get Help in Measuring Their Carbon Footprints? 

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For the time being, many small businesses find it challenging to gather data on these emissions that are out of their control. In the United Kingdom, only 10% of more than 1,000 firms surveyed keep track of their carbon footprint. What is more, one in five firms do not understand the meaning of the term net-zero, and one-third have not sought any advice to make their business more sustainable.  

The best way for small businesses to learn more about how they can improve their carbon footprint is to explore available resources on measuring emission data. The EPA Center for Corporate Climate Leadership has many resources to help small business owners on their way to measuring and reporting their emission levels. Business owners can learn how to create a greenhouse gas inventory, to measure their emissions, to engage with sustainable suppliers, and to gather the information needed to develop sustainable solutions.  

Another option is for small businesses to use a carbon footprint calculator to understand the number of emissions caused by their business operations. Once business owners understand how much carbon they are producing, they can begin to address where it is coming from within their business operation and make the necessary changes.  

The most important thing business owners can do is continually seek ways to adapt their business to operate at a more sustainable level. As more business owners seek advice on how to lower their carbon footprint, more information will be made available to aid them. 

Will Participating in a Carbon Offset Program Help Your Business? 

Whether you own a small business or a medium to large business, carbon offsetting is an excellent way to minimize the effects of emissions. Carbon offsetting works by supporting projects that endeavor to reduce the amount of carbon in the atmosphere.  

While you should still focus on reducing the emissions your business produces, purchasing carbon offsets can be an additional way to turn your company into an environmentally responsible business.   

Carbon offset purchases go toward projects like capturing gas from landfills and using methane from animal waste to generate electricity. Other ways of offsetting carbon include supporting clean wind energy projects and capturing methane from abandoned coal mines. 

Businesses and a Net-zero Future

The first step for businesses to aid in the global goal of a net-zero future is to understand and report their carbon footprints. Governments, customers, and investors wish to see enterprises reduce their carbon footprint over time.  

Resources are available for businesses of all sizes to learn about the methods they can use to begin measuring their carbon output. As more organizations take an interest in becoming environmentally sustainable, more information will be made available to business owners.  

If you would like to mitigate your company’s carbon footprint today, be sure to explore carbon offset programs for businesses. 

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