How to calculate a carbon footprint for your business
An organisational carbon footprint is an essential component on the journey towards net zero and is the first building block towards any sustainability strategy.
A carbon footprint can also provide an initial climate risk and opportunities assessment by identifying emissions hotspots across your value chain. Companies all over the world measure and report their carbon footprint to their stakeholders and use the findings to inform their sustainability actions.
However, if you are at the beginning of your journey you likely have some questions about how to kick off the process.
Where do I start?
Carbon footprints capture greenhouse gas (GHG) emissions outputs on an annual basis. Data will need to be gathered from a variety of different sources including travel, logistics and operations in order to gather a full and accurate footprint.
First of you, you will need to understand what exactly needs to be included and set the boundaries of your footprint. Measurements should include 100% of Scope 1 direct and Scope 2 indirect emissions from your own operations (access our glossary for more detailed definitions), plus all material Scope 3 emissions which are indirect emissions from activities outside an organisation’s own operations.
Data collection for Scope 3 emissions involves multiple stakeholders and data sources. This makes them more challenging but Scope 3 emissions are important as they often account for a significant proportion of a company’s carbon footprint – sometimes up to 90%. Examples of Scope 3 include business travel, employee commuting or emissions arising from the use of sold products but also upstream activities including raw material and agricultural production.
By breaking down your emissions into sources, you can find the hotspot areas where emissions reductions need to be focused and use this to identify areas of risk and opportunity for your company.
What information do I need?
The essential data required for your footprint includes:
- Energy, gas and water –facilities or energy teams usually hold this information but the finance department will also have access to this through invoices.
- Business travel – This includes staff travel and commuting. Air travel information can be collected from your travel agent or the team responsible for booking travel, whilst employee commuting can be calculated through a staff survey (not everyone will respond to your survey, so don’t be afraid to calculate emissions on average per full time employee).
How do I calculate my footprint?
Next up you will need to select the appropriate emission factor for each emission source in order to calculate the tonnes of CO2 emitted (tCO2e). It’s also important to ensure that your data is for a consistent time period, for example if you are doing an annual footprint then all data must be for the same boundaries. Ultimately, each organisation is different and therefore has differing material emission sources (the largest or most significant to business operations). A small office-based company’s energy use may be dwarfed by its business travel, for example.
Now that you have your data, you will need to select a methodology for your footprint that is most relevant for your organisation and your ambitions. You can choose to conduct a basic footprint using a carbon calculator spreadsheet or you can adopt an internationally recognised standard. The choice you make will depend upon the data that you have collected, as well as what you plan to do with the findings.
By calculating a carbon footprint, businesses can identify the best strategic approach to reducing emissions and setting robust targets, beginning you on your journey towards the net zero transition and readying you for the demands this will bring.
Download our Factsheet
Our Guide to Carbon Footprints introduces the basic principles behind creating a carbon footprint and the benefits to your company of conducting a carbon footprint.
Gain answers to the following questions:
- What is a carbon footprint?
- What are the organisational footprinting standards?
- Which standard is suitable for your organisation?