Corporate Carbon Counting Under Scrutiny—Comments Requested on Pending Updates to the Greenhouse Gas Protocol
December 21, 2022, Covington Alert
The Greenhouse Gas Protocol (“GHG Protocol” or “Protocol”)—a leading standard setter for measuring and managing corporate greenhouse gas emissions, borne of a partnership between World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD)—has opened stakeholder surveys concerning the revision of its Corporate Accounting and Reporting Standard, Guidance on Scope 2 Emissions, and the Scope 3 Standard and Scope 3 Calculation Guidance.
The GHG Protocol’s standards and guidance are a foundational element of the Science Based Targets initiative (SBTi), which helps shape and verify corporate emissions reductions targets and ensure they are aligned with the goals of the 2015 Paris Agreement. The Protocol is the preferred carbon accounting mechanism of major corporations: in 2016, over 92% of Fortune 500 companies that reported emissions data to CDP did so according to the GHG Protocol accounting standards. Yet the Corporate Accounting and Reporting Standard has not been revised since 2004, and the Guidance for Scope 2 emissions—i.e., emissions associated with a company’s electricity, heat, and steam—and Scope 3 (supply chain) emissions have not been revised at all since they were first published in the early 2010s.
The stakeholder surveys solicit feedback on and suggestions for potential revisions. The stated goal of the surveys is to “understand user needs, identify and address any gaps, and align with best practice approaches” to ensure that the Protocol effectively provides a “rigorous and credible accounting foundation for business to measure, plan and track progress toward science-based and net-zero targets in line with the global 1.5°C goal.” Interested parties will have until February 28, 2023, to submit their comments.
This stakeholder process is a unique opportunity for businesses, NGOs, academia, and government officials to shape the future of corporate sustainability reporting. Four topics have emerged as leading issues.
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