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Glossary

What are Scope 3 Emissions?

What are Scope 3 Emissions?

Scope 3 emissions are the indirect greenhouse gas emissions that occur across a company's value chain, both upstream (purchased materials, transport, capital goods) and downstream (use and end-of-life of sold products), but outside its own operations and energy use. Defined by the GHG Protocol, they sit alongside Scope 1 (direct emissions from owned sources) and Scope 2 (emissions from purchased energy). For most industrial and manufacturing companies, Scope 3 is by far the largest share of the total footprint, often 70 to 90%.

Scope 3 emissions are the indirect greenhouse gas emissions that occur across a company's value chain, both upstream (purchased materials, transport, capital goods) and downstream (use and end-of-life of sold products), but outside its own operations and energy use. Defined by the GHG Protocol, they sit alongside Scope 1 (direct emissions from owned sources) and Scope 2 (emissions from purchased energy). For most industrial and manufacturing companies, Scope 3 is by far the largest share of the total footprint, often 70 to 90%.

Robert Pell

Robert Pell

Date published

Reviewed by

Jordan Lindsay

Why Scope 3 emissions matter

Scope 3 is where the real footprint lives, and where it is hardest to control, because most of it sits with suppliers and customers rather than inside the company's own walls. A manufacturer can decarbonise its factory and barely move its total footprint if the bulk of emissions are embedded in purchased cathode material or steel.

That is also why Scope 3 has become a procurement issue, not just a reporting one. When a large company commits to cutting its Scope 3, it starts asking its suppliers for product-level emissions data, and suppliers who can't provide it risk being de-selected. One company's Scope 3 is another company's product carbon footprint.

The 15 categories of Scope 3

The GHG Protocol divides Scope 3 into 15 categories, eight upstream and seven downstream. Upstream categories include purchased goods and services, capital goods, fuel- and energy-related activities, upstream transport, waste, business travel, employee commuting, and upstream leased assets. Downstream categories include downstream transport, processing of sold products, use of sold products, end-of-life treatment, downstream leased assets, franchises, and investments. For most product manufacturers, "purchased goods and services" dominates the total.

How Scope 3 emissions are measured

There are two broad approaches. A spend-based method multiplies financial spend by generic emission factors. An activity-based method uses physical data and product-specific footprints. The spend-based method is quick but crude; the activity-based method, built on supplier product carbon footprints and LCA data, is far more accurate and is what credible, customer-facing reporting increasingly demands. The shift from spend-based estimates to primary, product-level data is the central challenge in Scope 3 today.

Scope 3 and life cycle assessment

A supplier's product carbon footprint, an LCA output, is the building block of a buyer's Scope 3 inventory. The more suppliers can provide rigorous, primary-data PCFs, the more accurate the whole chain's Scope 3 becomes. This is why LCA capability upstream and Scope 3 reporting downstream are two ends of the same problem: credible value-chain emissions data.

Accurate Scope 3 starts with primary, product-level footprints from your suppliers. See how Minviro builds supplier-grade product footprints →

Why Scope 3 emissions matter

Scope 3 is where the real footprint lives, and where it is hardest to control, because most of it sits with suppliers and customers rather than inside the company's own walls. A manufacturer can decarbonise its factory and barely move its total footprint if the bulk of emissions are embedded in purchased cathode material or steel.

That is also why Scope 3 has become a procurement issue, not just a reporting one. When a large company commits to cutting its Scope 3, it starts asking its suppliers for product-level emissions data, and suppliers who can't provide it risk being de-selected. One company's Scope 3 is another company's product carbon footprint.

The 15 categories of Scope 3

The GHG Protocol divides Scope 3 into 15 categories, eight upstream and seven downstream. Upstream categories include purchased goods and services, capital goods, fuel- and energy-related activities, upstream transport, waste, business travel, employee commuting, and upstream leased assets. Downstream categories include downstream transport, processing of sold products, use of sold products, end-of-life treatment, downstream leased assets, franchises, and investments. For most product manufacturers, "purchased goods and services" dominates the total.

How Scope 3 emissions are measured

There are two broad approaches. A spend-based method multiplies financial spend by generic emission factors. An activity-based method uses physical data and product-specific footprints. The spend-based method is quick but crude; the activity-based method, built on supplier product carbon footprints and LCA data, is far more accurate and is what credible, customer-facing reporting increasingly demands. The shift from spend-based estimates to primary, product-level data is the central challenge in Scope 3 today.

Scope 3 and life cycle assessment

A supplier's product carbon footprint, an LCA output, is the building block of a buyer's Scope 3 inventory. The more suppliers can provide rigorous, primary-data PCFs, the more accurate the whole chain's Scope 3 becomes. This is why LCA capability upstream and Scope 3 reporting downstream are two ends of the same problem: credible value-chain emissions data.

Accurate Scope 3 starts with primary, product-level footprints from your suppliers. See how Minviro builds supplier-grade product footprints →

Why Scope 3 emissions matter

Scope 3 is where the real footprint lives, and where it is hardest to control, because most of it sits with suppliers and customers rather than inside the company's own walls. A manufacturer can decarbonise its factory and barely move its total footprint if the bulk of emissions are embedded in purchased cathode material or steel.

That is also why Scope 3 has become a procurement issue, not just a reporting one. When a large company commits to cutting its Scope 3, it starts asking its suppliers for product-level emissions data, and suppliers who can't provide it risk being de-selected. One company's Scope 3 is another company's product carbon footprint.

The 15 categories of Scope 3

The GHG Protocol divides Scope 3 into 15 categories, eight upstream and seven downstream. Upstream categories include purchased goods and services, capital goods, fuel- and energy-related activities, upstream transport, waste, business travel, employee commuting, and upstream leased assets. Downstream categories include downstream transport, processing of sold products, use of sold products, end-of-life treatment, downstream leased assets, franchises, and investments. For most product manufacturers, "purchased goods and services" dominates the total.

How Scope 3 emissions are measured

There are two broad approaches. A spend-based method multiplies financial spend by generic emission factors. An activity-based method uses physical data and product-specific footprints. The spend-based method is quick but crude; the activity-based method, built on supplier product carbon footprints and LCA data, is far more accurate and is what credible, customer-facing reporting increasingly demands. The shift from spend-based estimates to primary, product-level data is the central challenge in Scope 3 today.

Scope 3 and life cycle assessment

A supplier's product carbon footprint, an LCA output, is the building block of a buyer's Scope 3 inventory. The more suppliers can provide rigorous, primary-data PCFs, the more accurate the whole chain's Scope 3 becomes. This is why LCA capability upstream and Scope 3 reporting downstream are two ends of the same problem: credible value-chain emissions data.

Accurate Scope 3 starts with primary, product-level footprints from your suppliers. See how Minviro builds supplier-grade product footprints →

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Robert Pell

Robert Pell

Founder & CEO

Robert Pell is the Founder and CEO of Minviro. His doctoral research at the University of Exeter's Camborne School of Mines focused on responsible sourcing of rare earth elements, pioneering novel Life Cycle Assessment approaches and developing methodology for integrating LCA into mine planning. A published scientist and experienced speaker, Robert holds roles as Chair of the Rare Earth Industry Association (REIA) and the Critical Minerals Association (CMA).