Scope 3 emissions are a consequence of the activities of the company, but occur from sources not owned or controlled by the company. Description of the company . Launched in September, the PCF Guideline has been created by TfS a sustainability collaborative of over 37 global chemical companies to establish a consistent way of generating PCFs throughout the chemical industry. Under the strategic direction of the SBTis Steering Committee, Emma is leading the development of the Corporate Net-Zero Standard. Scope 3. In the future, this will allow consumers and the wider market to directly compare and assess the climate impact of products. Scope 3 emissions Scope 3 encompasses emissions that are not produced by the company itself, and not the result of activities from assets owned or controlled by them, but by those that it's indirectly responsible for, up and down its value chain. Calculating the carbon footprint of products provides the best product-level information for identification, tracking and reducing scope 3 GHG emissions in the industry. Guest Speaker: Jonathan Dunn, Head of International Policy and Planning at Anglo American. With around two-thirds of the chemical industry's global emissions in scope 3, companies are facing urgent pressures to reduce emissions in order to meet the Paris Agreement goals, set. PCF calculations provide the best product-level emissions transparency for the identification, tracking and reduction of Scope 3 GHG emissions. Preference cookies enable a website to remember information that changes the way the website behaves or looks, like your preferred language or the region that you are in. The work companies do to tackle Scope 3 emissions can help strengthen relationships with suppliers and improve collaborationactions that can lead to cost savings, new revenue-generating opportunities or both. Bertrand Conquret, TfS President, President of Global Supply Chain & Chief Procurement Officer at Henkel, said: The new PCF Guideline is part of TfS mission and our speedboat to foster sustainability and have impact in global chemical supply chains. The $4.6 trillion chemical industry is integral to sectors ranging from aerospace to automotive and is responsible for a high level of global emissions, 77% of which are in Scope 3 (i.e.. Finally, soon you may not have a choice. ADI Analytics actively tracks decarbonization trends in the chemical industry along with drivers such as regulatory push, consumer buying trends, sustainability goals of chemical companies, and recycling technologies. As a result, he has developed a keen insight into, and understanding of, people, business culture and motivation which make him ideally placed to chair Shoosmiths partnership. Scope 3 emission sources include emissions both upstream and downstream of the organization's activities. Scope 2 accounts for purchased power, such as electricity and heating. Senior Sustainability Manager Fuel and Energy-Related Activities 2 . Throughout his career, Peter has dealt with clients at board level and advising directors on the best tactics to achieve their strategic aims. Scope 3 reporting has thus far been mostly voluntary, but the pressure to make it mandatory . Align Scope 3 emissions reduction with an existing net zero roadmap. Please choose your settings for optional cookies. Sky, Olwen Smith Our members are chemical companies committed to making sustainability improvements within their own and their suppliers operations. Thomas Udesen, CPO Bayer and TfS Steering Committee member, said: Calculating Scope 3 emissions is particularly challenging in the chemical industry, due to the complexity of chemical production. The last decade has been one of increasing corporate climate action and commitments; the next decade has to be one delivering against those commitments. 12 May, 10:00-11:00 BST, Kim McCann Some businesses will take raw material from a customer, refine or process it and provide back to the customer. Earlier in her career, she held account management roles at a tech company and worked at a Berlin-based social impact start-up. Scope 2 emissions are indirect GHGs released from the energy purchased by an organization. Apple's experience shows that for many businesses seeking to become carbon neutral, the bulk of progress must be made in reducing scope 3 emissions - especially for companies selling physical products. Tony has worked in international development for much of his life, with over fifteen years in Africa and Asia. Scope 3 emissions of purchased goods have historically been challenging to measure due to the complexity of chemical production the new Guideline aims to solve this. This limited supply chain within the sector reduces competition and could reduce the opportunities the business has to cut the embodied carbon of their products. The Guideline can be used by both corporations and suppliers to identify, track and reduce Scope 3 upstream emissions. Together for Sustainability creator of the PCF Guideline is a member-driven initiative, made up of chemical companies committed to building global CSR standards throughout their industry and across the entire chemical supply chain. The intention is to display ads that are relevant and engaging for the individual user and thereby more valuable for publishers and third party advertisers. Where the mining industry stands. While created initially to meet the needs of chemical corporations and their suppliers, the TfS Guideline can be used as a calculation guideline and drop-in solution in any other global industry using chemical products. Scope 3 emissions, also referred to as value chain emissions, often represent the majority of an organization's total GHG emissions. I consent to the use of following cookies: Necessary cookies help make a website usable by enabling basic functions like page navigation and access to secure areas of the website. We have supported business of different scale and product size across the Chemical sector such as Croda, Elementis and Synthomer, to tailor Scope 3 to them. While significant in emissions impact, the process of sourcing and accurately capturing data for Scope 3 can be a challenge. Carbon accounting is an accounting method to count, inventory, track, and report your organization's greenhouse gas (GHG) emissions. [ii] Those arising from the supply chain. Speak to one of our experts. Alexis joined NatWest in 2021 as the Climate Reporting Manager for the Groups own operations. We believe in the power of ingenuity to build a positive human future in a technology-driven world. The cookie is used in context with the local-storage function in the browser. Reduction factor will ensure emission reduction: For the period 2021-2030, the reduction factor will be increased to 2.2% per year (instead of 1.74%), resulting in a target CO2 reduction of 43% in 2030 compared with 2005. The Chemical sector is recognised as essential in the transition to the low carbon economy, so turning Scope 3 on its head and looking at the downstream carbon benefits could be a more useful narrative for your company. Upstream leased assets Downstream Scope 3 emissions 9. Our corporate responsibility aspiration is to be the leading law firm in the UK famous for its positive contribution to society and as a signatory to the UN Global Compact this enables us to work alongside likeminded organisations for a greater collective good. CDP, Isobel Filipova Discover more at paconsulting.com and connect with PA on LinkedIn and Twitter. If a company's Scope 3 emissions make up more than 40% of its total emissions, then the near-term target must cover two-thirds (67%) of Scope 3 emissions. Reaching net-zero: Carbon offsetting Biological or Technological? But the clothes will be produced by a third-party textile factory in Italy, for example. The PCF Guideline offers clear instructions on calculating Greenhouse Gas (GHG) emissions for specific chemicals production, e.g. This encapsulates more than just client service, but how Shoosmiths interacts with its clients, staff and communities. Using 2021 data, we calculated the proportion of Scope 3 emissions to total emissions for the top 6 global mining companies. At BASF, we create chemistry for a sustainable future . LEARN MORE>>>. Scope 3 is an optional reporting category that allows for the treatment of all other indirect emissions. Senior Advisor - Advancing Net Zero The availability of PCF data is limited, and calculations are often not directly comparable. Reducing carbon emissions is, however, a complicated task. Scope 1 and 2 emissions together account for 36%. These emissions are usually split into the following categories: In most reporting frameworks, it is not mandatory to report Scope 3 emissions. Cookies cannot read data off your hard disk or read cookie files created by other sites. The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network. He works with financial institutions, industry associations, and other stakeholders to help them set Science-Based Targets for GHG emissions reduction. Senior Manager, Net-Zero For most companies, the established, global accounting unit for carbon is the greenhouse gas carbon dioxide (CO 2), and "carbon equivalents" (CO 2 e) - the sum of carbon . 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Adding 18 billion of value to the UK economy, the Chemical industry is fundamental to modern society, underpinning global manufacturing supply chains, providing materials and products into a range of sectors from aerospace to pharmaceuticals, construction to consumer goods. This function allows the website to load faster by pre-loading certain procedures. This means not only tackling emissions in Scope 1 and Scope 2, but most importantly tackling emissions in Scope 3, the value chain emissions. Guest Speaker: Dorothe DHerde, Head of Sustainable Business at Vodafone. Scope 3 emissions are all indirect emissions - not included in scope 2 - that occur in the value chain of the reporting company, including both upstream and downstream emissions. Marketing cookies are used to track visitors across websites. A target for its scope three emissions was announced by the German speciality chemicals manufacturer LANXESS. The chemical industry has a "trifecta" opportunity to lower their scope 1 and scope 2 emissions and downstream end-market scope 3 emissions. The fashion industry has significantly reduced Scope 1 and Scope 2 emissions However, 90% of the industry's emissions are from indirect (Scope 3) sources. Alexis has a masters degree in Climate Change Science and Policy from the University of Bristol and is a chartered environmentalist through IEMA. The retailer will rent premises on the high street to sell clothes. For example, citric acid is one of many components found in household cleaners. In the chemicals industry, at least 75 percent of emissions come from scope 3. All Rights Reserved, 440 Cobia Drive
If the Scope 3 emissions are not quantified in the right way based on reliable industry-based data or are not considered at all, it could result in financial risks, high capital costs, reputational damage due to green-washing, or even loss of your license to operate. 2022 Reducing Scope 3 Emissions - Webinar Series, Purchased Goods & Services & Capital Goods, Global Head of Value Chains & Regional Director Corporations, UK & Worldwide Regional Lead - Commit to Action Programme, Design Engineer (Sustainable Product Development), Global Head of Sustainability - Consumer & Manufacturing, 2020 Reducing Scope 3 Emissions - Webinar Series. Scope 3 emissions cover a broad range of activities across Cisco's supply chain, business operations, products, and solutions. Consulting Director Chemicals in Japan have started to look for ways to locally recycle Croda, Steven Thompson The Sectoral Decarbonization Approach provides sector-based emission reduction pathways for corporate activities. David Yankovitz, who leads the chemical group at the consulting firm Deloitte, says scope 3 emissions are on the minds of the industry's sustainability executives, but few firms have detailed . CDP & Member of SBTis Corporate Engagement Team, Julia Creasey Working out who owns emissions in this scenario and how they get allocated is no mean feat. EU in 2010. Together for Sustainability launches the open-source PCF Guideline, a new global guidance for calculating Product Carbon Footprints (PCFs) in the chemical industry and beyond. By moving away from a strict Scope 3 reporting, you actually provide investors, customers and other stakeholders with a more complete view of your business impact. Exhibit 1 shows that based on annual GHG emissions reported for 2019 by three of the largest chemical companies BASF, Dow, and Solvay more than ~75% of their emissions are defined as Scope 3. emissions via collection programs, recycling, and alternative materials in the Buy ADI reports and data from our subscription services and multi-client research. Step 1. Dentsu International, Olwen Smith As discussed above, Scope 3 emissions are indirect emissions, most of which come from processing, selling, and end-of-life treatment of sold products of the chemical companies. "Across all of the categories, transportation is usually a top three contributor to total emissions, representing about 10-15%," states Brett. Covestro is in good company here: This ratio reflects the overall situation for the chemical industry, which is responsible for about 7 percent of global Greenhouse Gas Emissions (GHG), nearly 80 percent of which are in Scope 3. Cookies are small text files containing a string of characters which are sent and stored on your computer or mobile device when you visit our website (the Site). Scope 3 includes emissions from your suppliers as well as consumers of your products and services (upstream and downstream activities). Emma Watson joined CDP in 2021 as the SBTis Senior Manager for Net-Zero. Efficiency & renewable feasibility studies, Carbon footprints & carbon action programme, Supply chain environmental & social impact assessment, We can help you report on your Scope 3 emissions. To view or add a comment, sign in. positively engage with employees to reduce emissions from business travel and employee commuting. Global Head of Value Chains & Regional Director Corporations It is even more complicated if the product is combined with other products for final sale. (not in Scope 2) that occur in the value chain of the reporting company Each expanded functionality category is explained in more detail later in this topic. However, this will look different for every business in the sector. These indirect emissions often represent the largest portion of your corporate footprint; in some cases, they account for as much as 90% of an organization's total emissions. sheet steel used to manufacture white goods. As Supply Chains Manager at the We Mean Business Coalition, Lydia works across net zero climate action and supply chains strategy. Montreal Protocol gases are mainly propellants, foams, or liquids and gases used for cooling and refrigeration that are produced by the chemical industry. It is no longer a case of businesses simply monitoring the emissions from within their own operations (Scope 1 and 2). If you predominantly rely on toll materials, or you have a limited number of flagship products with clear end applications, taking a value chain view can often make most sense. The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes. Applying SBT methods to scope 3. In short, Scope 3 emissions have largely been neglected until now. Emma has extensive knowledge of the Greenhouse Gas Protocol and Scope 3 Standard, and co-authored the UK Green Building Councils Guide to Scope 3 Reporting in Commercial Real Estate. There are pioneers and leaders within the Chemical sector, however no business has completely perfected it yet. Long-term science-based targets are . Owen Mumfords goal is to improve quality of life, encourage adherence to treatment and reduce healthcare costs. Her work focuses on engaging and supporting high-impact companies to commit to and develop ambitious targets through the Science Based Targets initiative. It harmonizes PCF calculation approaches across the industry and is applicable to the vast majority of chemical products. The technical storage or access that is used exclusively for statistical purposes. This is also known as your carbon footprint. However, a new Supplier Carbon Footprint (SCF) tool, produced by ICIS, chemical data specialists, in partnership with Carbon Minds, environmental impact . This is primarily because Scope 3 emissions are more difficult to accurately measure, report, and benchmark . citric acid production. While chemicals are fundamental to modern society and innovative breakthroughs,. It is estimated to be responsible for 7% of the global Greenhouse Gas (GHG) emissions[i], 77% of which are in Scope 3[ii]. Stephanie Chang is responsible for driving the integration of sustainability factors across the investment teams at Schroders and has successfully delivered on the firms goal of full integration across the firms managed assets in 2020. The Guideline can be used by both corporations and suppliers to identify, track and reduce Scope 3 upstream emissions. Calculate your Scope 3 emissions based on information specific to your supply chain and business. Put supply chain sustainability first if you want your business to thrive, Fashion business must look beyond textile swapping to achieve sustainability goals. these companies may have much more resources and capabilities to reduce Scope 3 There is a translation that needs to happen break categories into sub-groups that actually align to your business. Global Environment Strategy Lead According to Green House Gas Protocol, there are 15 categories that Scope 3 emissions can fall into, including capital goods, business travel, and use of sold products. To view or add a comment, sign in The Guideline will be applicable across industries; it will be open source and useful for other industries using chemical materials. Whilst Scope 3 impact could (and should) be reported on for SBTs or net zero, your reporting does not need to end there. assess where the emission hotspots are in their value chain; identify resource and energy risks in their supply chain; identify which suppliers are leaders and which are laggards in terms of their sustainability performance; identify energy efficiency and cost reduction opportunities in their value chain; engage suppliers and assist them to implement sustainability initiatives; improve the energy efficiency of their products; and. For more information, including interviews and comment, please contact: Together for Sustainability (TfS) is a global, procurement-driven initiative created by chemical companies with the goal of assessing, auditing and improving the sustainability practices within their global supply chains. Chemical supply chains for a better world. The Guideline has been published as open source with the ambition that it may be used in other industries too. But chemical supply chains are exceptionally complex and obtaining accurate PCF data for scope 3.1 reporting has been near impossible. document.getElementById( "ak_js_2" ).setAttribute( "value", ( new Date() ).getTime() ); document.getElementById( "ak_js_3" ).setAttribute( "value", ( new Date() ).getTime() ); 2022 Avieco. ADI is a boutique consulting firm based in Houston, Texas and specializing in oil & gas, energy, chemicals, and industrials. With around two-thirds of the chemical industrys global emissions in scope 3, companies are facing urgent pressures to reduce emissions in order to meet the Paris Agreement goals, set corporate sustainability targets and meet increasing customer demands for supply chain transparency. Step 3. Scope 1 emissions are direct emissions from owned or controlled Scope 3 emissions fall within 15 categories, though not every category will be relevant to all organizations. They do not actually own that material, but simply provide a chemicals service. Companies should calculate emissions from all of their operations for Scope 1 and 2 categories. According to GHG protocol, scope 3 emissions are separated into 15 categories. 2009-2022 ADI Analytics LLC. Scottish Leather Group, Transportation and Distribution Descriptive information . Peter Duff is the chairperson of Shoosmiths. handling. Our 2022 Scope 3 Webinar Series follows on from three webinars the UN Global Compact Network UK hosted in 2020: Webinar: CATEGORY 1: PURCHASED GOODS AND SERVICES Guest Speaker: Dorothe DHerde, Head of Sustainable Business at Vodafone. Head of ESG Integration It allows the website to recognise your device and store some information about user preferences or past actions. The solution can store emission data for any scope 3 category. [i] Sources: IPCC, UN, The Guardian, Our World in Data, CAMELOT | Note: The 7% are the total GHG emissions of Industry-Chemicals and Energy-Chemicals plus the respective shares of unallocated energy emissions and caused by energy production. Source: analysis of CDP responses in 2020, via Avieco, Translating Scope 3 emissions for the chemical sector. 3 The industry's inherent growth adds to the challenge. For example, Kraft Foods found that value chain emissions comprise more than 90% of their total emissions. Owen Mumford is a major medical device manufacturer that develops pioneering medical devices for its own Owen Mumford brand and custom device solutions for the worlds major pharmaceutical and diagnostic companies. His role is to lead the firms partnership in the delivery of its strategic vision, to be the UKs leading law firm, famous for its client experience. Emma has also worked at environmental consultancy, RPS Group, and gained an MSc in Carbon Management and BSc with Honours in Environmental Science, both from the University of Edinburgh. The last group of emissions under the GHG Protocol, Scope 3, however, presents a far bigger challenge for corporates and their treasurers. UK & Worldwide Regional Lead - Commit to Action Programme sources. For the SME Climate Hub, a core initiative of the Coalition, Lydia strengthens the initiatives collaboration with multinational companies and helps to develop the tools that small and medium sized businesses need to take climate action.
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