Scope 3 Emissions

Scope 3 emissions refer to all indirect greenhouse gas emissions that occur across a company’s value chain. These include emissions from purchased goods, transport, employee commuting, product use, and disposal. They are not generated by the company itself but are a consequence of its activities.

These emissions typically represent the largest share of a company’s carbon footprint. In many industries, they can exceed 70 percent of total emissions. Despite this, they are often underreported or overlooked due to the complexity of measurement and lack of direct control.

Regulatory frameworks and investors are placing increasing pressure on companies to disclose Scope 3 emissions. New standards such as the ISSB and the EU’s CSRD emphasize value-chain emissions to provide a more complete picture of climate risks and opportunities.

Managing Scope 3 emissions is essential for any serious decarbonization strategy. Focusing only on Scope 1 and 2 emissions can result in a misleading view of progress and leave significant sources of impact unaddressed.

A first step toward management is a detailed mapping of emissions sources across the value chain. This includes upstream and downstream activities such as supplier manufacturing, distribution, and product end-of-life. Access to reliable data is critical for setting meaningful targets.

Business engagement across the value chain is key. Results are more effective when companies work collaboratively with suppliers and partners to implement practical improvements rather than relying solely on reporting requirements.

Reduction strategies can include changes in product design, material choices, packaging, logistics, and customer use models. Many of these measures also offer operational efficiencies and supply chain resilience.

Addressing Scope 3 emissions can enhance competitive positioning. Clear action and transparent reporting contribute to stronger stakeholder trust, alignment with financing criteria, and preparedness for emerging climate regulations.

Source: Neste

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