For most companies, the emissions that matter most are the ones they do not directly control. Scope 3 — the emissions across a company's value chain — typically accounts for 70–90% of the total footprint, and it is exactly where measurement is hardest because the data sits with suppliers and customers rather than on your own meters.
Scope 1, 2 and 3 in one line each
Scope 1 is direct emissions from sources you own or control (fuel, processes, fleet). Scope 2 is indirect emissions from the energy you purchase (electricity, steam, heating, cooling). Scope 3 is everything else in your value chain — both upstream and downstream — and it is governed by the GHG Protocol Corporate Value Chain (Scope 3) Standard.
The 15 categories
Scope 3 is divided into 15 categories — eight upstream and seven downstream. Upstream covers purchased goods and services, capital goods, fuel- and energy-related activities, transportation, waste, business travel, employee commuting and leased assets. Downstream covers transportation and distribution, processing and use of sold products, end-of-life treatment, leased assets, franchises and investments. Not all 15 are relevant to every company — but all 15 must be screened.
Why it is hard
Scope 3 data lives outside your organisation. Suppliers may not measure their emissions; customers' use of your products is outside your control; and the further down the value chain you look, the thinner the data gets. The honest answer is that Scope 3 is an estimate that improves over time, not a precise meter reading on day one.
The measurement methods — an accuracy ladder
- Spend-based: multiply money spent by an emission factor per unit of spend. Fast, complete, low accuracy — good for a first screen.
- Average-data: use physical activity data (kg, km, kWh) and average emission factors. More accurate than spend-based.
- Supplier-specific (activity-based): use primary data from your actual suppliers. Most accurate, most effort — reserve it for material categories.
Where to start
Screen all 15 categories quickly, usually with spend-based data, to find where emissions concentrate. For most companies that is purchased goods and services, and — for product makers — the use phase of sold products. Then deepen data quality only on those material categories. Trying to perfect all 15 at once is the most common way to stall a Scope 3 programme.
Why it matters now
Scope 3 is no longer optional. It is required under most disclosure standards (CSRD, IFRS S2), it is central to credible SBTi targets, and it increasingly appears on customer scorecards. The same value-chain data also underpins product carbon footprints and CBAM. Built once, properly, it serves all of them.
Sources & further reading
This article is general information, not legal, financial or compliance advice. The regulations and standards referenced here evolve; verify the current position with the issuing body, or ask us. Published June 2026.