Carbon Footprint Meaning, Calculation, Reduction and Reporting


The most notable highlight of the Paris Climate Conference of 2015 was that the globe is heading into a disaster, and we have to take action to keep the surface temperature below 2°C compared to pre-industrial levels. We must say that this is not an easy task because so many other initiatives, from the Kyoto Protocol to Corporate Social Sustainability (CSR), failed or yielded minimal results. Because global warming is caused by greenhouse (GHG) emissions, the first step is carbon footprint meaning. 

For corporations, carbon footprint reduction is crucial for compliance and stakeholder engagement. This post digs deeper into carbon footprint meaning, reduction strategies, and reporting needs. If you want to be successful in business, you must adopt viable strategies for carbon emission reduction. 

Carbon Footprint Meaning

If you are new to ESG sustainability reporting, the first question is likely to be, “what is carbon footprint?” This is the amount of carbon emissions that are associated with the activities of a company, product, or service. On a larger scale, the carbon footprint can be calculated for a city, village or country. 

Carbon footprint includes direct emissions, such as those from the combustion of fossil fuels, transportation, and heating. It also captures indirect emissions, such as the electricity used for industrial production of services or goods. When calculating your carbon footprint, you must also factor in the emissions from outside your facility walls, especially those associated with the company’s supply chain network. 

Why Calculate Your Organizational Carbon Footprint?

Here are some of the benefits to anticipate for calculating carbon footprint of your organization: 

  • Helps you to understand the main sources of emissions in your company. 
  • You are able to craft the best strategies for cutting down your carbon footprint. 
  • Calculating your carbon footprint helps you to delve deeper into the operations of your company and identify the main challenges and opportunities. 
  • It is an important part of the ESG reporting process for compliance. 
  • Helps to improve stakeholder engagement. 
  • Calculating carbon footprint is helpful in promoting the accuracy and verifiability of information you use for ESG sustainability reporting.

What Do You Require to Correctly Calculate Your Carbon Footprint?

The standard measure used for calculating carbon footprint is metric tons of carbon dioxide equivalent (MT CO2e). So, here are the main requirements for calculating carbon footprint: 

  • Direct emissions that come from your production system. 
  • Indirect emissions result from the consumption of electricity, heat, and steam. 
  • In addition, there are scope three emissions, which result from emissions in the supply chain. 
  • An appropriate ESG reporting framework, such as Climate Change Reporting Framework (CCRF) and the Task-force on Climate-related Financial Disclosures (TCFD). 
  • A good sustainability reporting software. The program will help you to gather data on GHG emissions, social, governance, and other environmental risks. The app will also be very helpful when writing the ESG report. 
  • Prepare the right team to gather data on GHG emissions. If the team does not have the required skills, it is advisable to start with capacity building. You should also consider bringing on board a professional in financial, ESG and sustainability matters. 

This post has demonstrated that understanding carbon footprint meaning is important, but it is only the first step. The most important thing is being able to categorize the emissions into different classes, craft strategies for reduction, implement them, and report to stakeholders. To get it right, make sure to work with experts in GHG emissions and strategy formulation for your company. Besides, you need to have the best sustainability management software

One of the top firms that you can count on to get carbon footprint meaning and the process of ESG sustainability reporting right is Visit them on their website now to chat with a carbon footprint professional and get the best app for ESG reporting.

The views expressed in this article are those of the authors and do not necessarily reflect the views or policies of The World Financial Review.