What Are Scope 3 Emissions?
Scope 3 emissions cover all other indirect emissions across your value chain. Unlike Scope 1 (direct emissions) and Scope 2 (energy-related emissions), Scope 3 includes the broader impacts of your business activities. These can be both upstream (purchased goods, supplier activities) and downstream (product use, distribution, disposal).
GHG Protocol Scope 3 Standard
The GHG Protocol Scope 3 Standard sets out 15 categories that provide a structured way to measure and report indirect emissions across the value chain. These categories ensure consistency and comparability between businesses, making Scope 3 reporting credible and actionable. Examples include emissions from purchased goods and services, business travel, employee commuting, and the use of sold products. Together, they capture the full picture of how a company’s operations and supply chain contribute to its overall footprint.
Why It Matters
Scope 3 emissions often account for the majority of a company’s footprint—sometimes as much as 70–90%. Ignoring them risks leaving the biggest part of your climate impact unaddressed, which can undermine credibility with clients, investors, and regulators. Tackling Scope 3 shows that your business is serious about sustainability across the entire value chain.
Measuring Scope 3 is also a powerful driver of change. By quantifying these emissions, businesses can identify hotspots in their supply chain, engage suppliers in reducing impacts, and redesign products or services to be more sustainable. This data enables companies to set meaningful targets, track progress, and demonstrate leadership in climate action. In practice, measuring Scope 3 turns sustainability from aspiration into measurable transformation.
The Business Case
Addressing Scope 3 emissions positions your company as a leader in sustainability. Businesses that measure and manage these impacts can build stronger supplier relationships, reduce exposure to reputational risks, and meet growing investor demands for transparency. It also opens doors to new contracts, as clients increasingly require full value chain reporting. For SMEs, tackling Scope 3 can uncover efficiency gains, highlight opportunities for collaboration, and demonstrate credibility in competitive markets. In short, Scope 3 is where sustainability becomes a driver of both resilience and growth.
Practical Steps
Start with the categories most relevant to your business, such as purchased goods or business travel. Engage suppliers to share data, and where direct information isn’t available, use industry averages to build a credible baseline. Over time, refine your data and expand coverage to strengthen your reporting and impact.
Benefits for SMEs
- Opportunity to drive positive change
- Strengthens supply chain relationships.
- Identifies efficiency and cost‑saving opportunities.
Improves tender readiness for contracts requiring full emissions reporting.