Generic Carbon Emissions Question 3

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Question

Has the brand (company) disclosed the annual absolute carbon footprint of its 'own operations' (Scope 1 & 2) and has the brand already reduced or compensated 10% of these emissions in the last 5 years?

  • Dutch version: Heeft het merk (bedrijf) de absolute 'CO2-voetafdruk' als gevolg van de eigen bedrijfsvoering (Scope 1 & 2) gepubliceerd en heeft het bedrijf in de laatste vijf jaar al 10% daarvan gereduceerd of gecompenseerd?
  • German version: Veröffentlicht der Markenhersteller eine absolute Klimabilanz zum eigenen Betrieb? Wurde die Klimabilanz in den letzten fünf Jahren um mindestens 10% reduziert oder kompensiert?

Reference

This question relates to indicators G4-EN15, G4-EN16, G4-EN17, G4-EN18, G4-EN19 and G4-EN21 in the G4 Guidelines of the Global Reporting Initiative, and criterion 13 'Climate-relevant Emissions' of the Sustainability Code 1 2 from the German Council of Sustainable Development. A carbon footprint is "the total set of greenhouse gas (GHG) emissions caused by an organization, event, product or person." For this question, the carbon footprint should at least cover the C02 emissions.

A carbon footprint consists out of:

Own operations:
Scope 1: Direct Emissions: Emissions from the sources that are owned or controlled by the company, for example, owned and leased offices, vehicles, factories and shops
Scope 2: Indirect Emissions: Emissions from the used electricity for all of its own sources

Please note: In 2015, the GHG Protocol changed its guidelines for reporting Scope 2 emissions from purchased electricity. These emission now need to be reported as two numbers instead of one: ‘location-based’ methodology, which applies a grid average emissions factor, and ‘market-based’ methodology that uses supplier-specific emissions information wherever it is available. The latter methodology tends to better reflect electricity purchasing decisions, therefore if available please base assessment on ‘market-based’ methodology.

Optionally: third-party operations
Scope 3: Other Indirect Emissions: Emissions from suppliers/factories that are NOT owned by the company, business travel, transportation & distribution, employee commuting & teleworking

Please note: Staff flights/travel are regularly included in the footprint as part of the 'own operations' footprint (though it's technically reported as Scope 3 emissions).

Structural changes Companies often undergo significant structural changes such as acquisitions and mergers, which is different than the organic growth of a company. These changes will alter a company’s historical emission profile, making meaningful comparisons over time difficult. In order to maintain consistency over time, or in other words, to keep comparing “like with like”, historic emission data can be recalculated, according to the Corporate Standard of the GHG Protocol, see Chapter 5, p.34 and further.

In case of divestment, disposal of (or outsourcing) a facility or other part of the company to another company, we require recalculation of the base year carbon footprint to prove reductions of carbon emissions. When you find (heavily) reduced carbon footprints, always check if the company gives credible explanations of how this was achieved. If there is no credible explanation, you should answer with a '?'. If (one of the) reason is disposal of company parts, then check if the needed recalculation was made. Alternatively you can check the significance of this divestment or disposal to conclude your answer and remark.

Ranking guidelines

A ‘Yes’ is applicable when:

  • Companies publish a carbon footprint including the results from earlier years that give a clear breakdown of the inputs that contribute to this footprint (e.g. Scopes 1 and 2), and show a reduction of at least 10%.
  • Companies indicate that they have reported their carbon footprint on a publicly available website and the ranker has independently verified that it meets our criteria (see hints/reminders in section below).
  • Eligible to this question are also actions to (partly) compensate the carbon footprint (=carbon offsetting), on the condition that the brand/ company clearly reports what the compensation schemes are (concrete projects, concrete numbers) and the brand/company describes the additionality of these projects. Read more here about additionality of carbon credits and here about additionality of renewable energy certificates. Please be sure that the net carbon footprint (so carbon footprint minus compensation) of the last reported year is 10% lower than the highest net carbon footprint in the last 5 years.
  • If the company already reduced annual greenhouse gas emissions to a minimum, e.g. by using green electricity and compensating through credible programs (such as gold standard) and reports concrete details (numbers and type of project(s)) with regard to the compensation project(s).

A ‘No’ is applicable when:

  • Companies have an increase in their carbon footprint.
  • The percentage of reduction achieved is less than 10%.

A ‘?’ is applicable when:

  • Companies do not report a carbon footprint.
  • No percentage is provided for how much the CO2-footprint has reduced (or increased) and/or there is not enough information to clearly calculate such a reduction (or increase).
  • Companies publish the carbon footprint only relative to e.g. turnover, number of products sold, number of employees etc. The carbon footprint should be presented in absolute terms.

Calculating Reductions:

  • The 10% reduction is calculated relative to the year where the footprint was largest, counted from a base year within the past 5 years. The ‘year of reduction’ is the latest year for which the footprint is made available. Note that this footprint should not be older than 2,5 years (for example if it is now August 2010, the footprint should cover years 2008 or 2009).
  • Also note that when a company e.g. has grown or decreased, or acquired / sold a company part, you don’t take proportional reductions or additions into account.
  • Please mention in the remark section exactly where you found the footprint information and how you calculated the achieved reduction.

Answering guidelines

Answer Yes:

  • [Brand] reduced its own operations climate footprint from [..Amount] tons of CO2 in [..YR] to [..Amount] tons of CO2 in [..YR], which represents a reduction of around [..%].
  • [Brand] publicly reports its own operations climate footprint. In [..YR], it had a total footprint of [..] metric tons of CO2eq/yr, compared to [..] metric tons of CO2eq/yr in [..YR]. This represents a reduction of around [..]%.


Answer No:

  • [Brand] reduced its own operations climate footprint from [..Amount] tons of CO2 in [..YR] to [..Amount] tons of CO2 in [..YR], which represents a reduction of only [..%].
  • [Brand] increased its own operations climate footprint from [..Amount] tons of CO2 in [..YR] to [..Amount] tons of CO2 in [..YR], which represents an increase of around [..%].
  • [Brand] publicly reports its own operations climate footprint on the CDP website. In [..YR], it had a total footprint of [..] metric tons of CO2eq/yr, compared to [..] metric tons of CO2eq/yr in [..YR]. This represents a reduction of only [..]%.
  • [Brand] publicly reports its own operations climate footprint on the CDP website. In [..YR], it had a total footprint of [..] metric tons of CO2eq/yr, compared to [..] metric tons of CO2eq/yr in [..YR]. This represents an increase of around [..]%.


Answer ?:

  • [Brand] claims its climate footprint has reduced by [..]% from [..YR] to [..YR]. However, [Brand] does not publicly provide the details of this climate footprint (or where to find it).
  • [Brand] does not publish the annual climate footprint of last years. It is therefore not clear if the implemented measures actually helped to reduce the total annual greenhouse gas emissions.
  • [Brand] does not publish an up to date (not older than 2,5 years) annual climate footprint of last years. It is therefore not clear if the implemented measures actually helped to reduce the total annual greenhouse gas emissions.
  • [Brand] publicly reports its own operations climate footprint. In [..YR], it had a total footprint of [..] metric tons of CO2eq/yr. However, a climate footprint of previous years is not made public.
  • Neither [Brand] nor [...] (brand owner) communicate a carbon footprint policy.
  • See remark for carbon emissions policy question 1.


-* You can pick the topic that applies to 'your' brand.

Note: when linking to a downloadable source document, please refer to the page(s) where to find the respective information with: (see link, page [..]).

Optional, but only for ? Answers, feel free to write at the end of a remark: Sustainability information should be easily accessible for consumers to make responsible choices.

Further resources

Hints/Reminders

  • This information is often published in a CSR report, however, we can use other information that is publicly available provided that the brand/company references it first on their own site. For example, when a brand indicates that they have reported their carbon footprint on a publicly available website such as the CDP website, we can also check that location. Rankers should still verify that the brand has reported on BOTH Scope 1 and 2 emissions.
  • Check the brand website for details first, but often this information can be found on the brand owner website (try sections of the website that are titled: Sustainability, CSR, Corporate Information, Investor Relations, etc.).
  • Keywords might include: carbon, CO2, footprint, emissions, CDP, reduction, operations, etc.