
Decarbonisation: what it is and why it matters
In this article, we break down what decarbonisation means, explore why it's urgently needed, and outline practical steps companies can take to support the global push toward net zero.
ESG / CSR
Industries
If you can’t measure it, you can’t manage it. That’s especially true when it comes to greenhouse gas (GHG) emissions, and that’s where the Greenhouse Gas Protocol comes in.
Co-created in the late 1990s by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), the protocol emerged just as climate action was gaining international momentum. Today, it’s the foundation of most carbon reporting systems, underpinning CDP disclosures, ESG strategies, and national climate plans alike.
From tracking emissions from company vehicles to mapping the carbon footprint of global supply chains, the GHG Protocol gives organisations a way to turn complex climate impacts into actionable data.
In this article, we’ll break down the Greenhouse Gas Protocol, explain the difference between Scope 1, 2, and 3 emissions, and show how it helps businesses take meaningful steps toward reducing their environmental impact.
But it’s more than just a reporting tool.
At its core, the GHG Protocol helps organisations understand where their emissions are coming from and how to reduce them. By turning complex climate data into clear, comparable metrics, it makes it easier for businesses to take targeted, effective climate action.
Why does this matter? Because reducing GHG emissions is essential to slowing global warming and avoiding the most dangerous impacts of climate change. But without a reliable way to measure emissions, any reduction target is just guesswork.
That’s where the GHG Protocol plays a vital role. It not only enables organisations to build detailed carbon inventories, it also helps them pinpoint the most impactful areas to cut GHG emissions. And because the standards are internationally recognised, they ensure that efforts are transparent, credible, and comparable across sectors and borders.
In fact, according to the GHG Protocol, 97% of disclosing S&P 500 companies reported to CDP using the Greenhouse Gas Protocol – a testament to its role as the gold standard in corporate emissions reporting.
By the late 1990s, the world was waking up to the climate crisis, but there was a major problem: no one could agree on how to measure GHG emissions.
Businesses, governments, and organisations all understood that reducing greenhouse gases was essential. Yet without a standardised way to track emissions, progress was patchy at best. Companies couldn’t benchmark their performance, investors couldn’t compare climate claims, and policymakers lacked the data needed to shape effective climate policy.
That’s the gap the Greenhouse Gas Protocol set out to fill.
The need for that consistency has only become more urgent. The World Meteorological Organization (WMO) has confirmed that 2024 was the hottest year on record, with a global average surface temperature of 1.55°C above pre-industrial levels. This means we’ve likely just experienced the first calendar year where the global mean temperature exceeded 1.5°C.
That 1.5°C threshold lies at the heart of the Paris Agreement, a global pact signed in 2015 to limit global temperature rise and avoid the most dangerous consequences of climate change.. It represents more than a symbolic target – it’s a boundary that, if crossed for the long term, could lead to irreversible damage to ecosystems, economies, and human lives.
Measuring GHG emissions is only the starting point. What the Greenhouse Gas Protocol really offers is a foundation for building effective climate strategies, driving accountability, and turning ambition into action at every level.
As climate challenges evolve, so do the Protocol’s frameworks. New standards have been developed to address everything from product value chain emissions to city-wide mitigation planning. Whether you're a multinational corporation or a municipal government, the GHG Protocol offers tailored guidance to help you navigate your emissions landscape.
This flexibility is what makes it so powerful. It supports action across entire value chains, covering both direct and indirect emissions through the GHG Protocol scopes, enabling companies to understand where their emissions originate and where to focus their efforts. In doing so, it helps organisations focus not just on what they control, but on where they can make the biggest impact.
By enabling a data-driven, forward-looking approach to GHG emissions management, the GHG Protocol helps make climate action more effective, more accountable, and more aligned with global goals for greenhouse gas reductions.
The Greenhouse Gas Protocol is best known for its system of categorising GHG emissions into Scope 1, 2, and 3 - a framework now used around the world to help organisations structure their carbon reporting. But this is just one part of its broader contribution to climate action.
Beyond the scopes, the Protocol has developed a wide range of standards tailored to specific sectors, use cases, and emissions challenges. These include everything from product life cycle accounting to city-wide emissions tracking. And the standards aren’t static, they’re regularly updated to reflect the evolving landscape of climate science, policy, and industry needs.
For example, in 2019, the GHG Protocol partnered with the Partnership for Carbon Accounting Financials (PCAF) to create a standard for financial institutions. The goal? To help banks and investors account for the emissions linked to their portfolios, an essential step in aligning finance with climate goals.
The Protocol also supports users with tools, guidance documents, and training programmes to improve the accuracy and efficiency of emissions reporting.
To build an accurate greenhouse gas inventory, companies need a clear way to categorise their emissions, and that’s where the GHG Protocol scopes come in.
Understanding these scopes is key to setting science-based targets, identifying reduction priorities, and tracking progress over time.
These are GHG emissions that come directly from sources a company owns or controls. This includes fuel combustion in company vehicles, manufacturing equipment, or on-site heating systems. If your company is burning fuel or releasing gases on-site, that’s Scope 1.
Scope 2 refers to emissions that occur off-site but are tied to the energy a company purchases and consumes. Most commonly, this includes emissions from the generation of electricity, steam, heating, or cooling used in offices, factories, or data centres.
Scope 3 emissions are the most wide-ranging and often the most significant. They include all other indirect emissions that occur as a result of a company’s activities, but from sources not owned or directly controlled by the company. This can include everything from the production of raw materials and transportation of goods to employee commuting, product use, and end-of-life disposal.
For many companies, Scope 3 emissions account for the vast majority of their carbon footprint – sometimes as much as 90%. That’s why tackling Scope 3 is critical for any organisation aiming to make meaningful progress on climate goals.
Here’s how the three scopes break down:
Scope | Definition | Examples |
---|---|---|
Scope 1 | Direct GHG emissions from owned or controlled sources | Fuel used in company vehicles, emissions from on-site boilers or furnaces, process emissions from manufacturing |
Scope 2 | Indirect GHG emissions from purchased energy | Emissions from the generation of purchased electricity, heating, cooling, or steam used in company buildings |
Scope 3 | All other indirect GHG emissions across the value chain | Purchased goods and services, business travel, waste disposal, transportation and distribution, product use, and end-of-life |
The Greenhouse Gas Protocol isn’t a single document, it’s a collection of evolving standards designed to meet the diverse needs of organisations measuring and managing their emissions.
While the Scope 1, 2, and 3 framework offers a high-level view of emissions sources, these standards provide the technical guidance needed to apply that framework in practice. They support everything from corporate carbon reporting and product-level assessments to national climate policies and city-wide decarbonisation plans.
Each standard responds to a specific challenge, whether it’s calculating the impact of a climate policy, understanding the carbon footprint of a supply chain, or designing a lower-emissions product.
Let’s explore the key standards and how they’re used:
The Corporate Standard serves as the foundation for GHG emissions measurement at the organisational level. It outlines how to build a reliable GHG inventory, including how to define organisational and operational boundaries, categorise GHG emissions sources, and ensure data quality over time.
Though primarily designed for companies, it’s also used by government agencies, non-profits, and academic institutions to ensure consistency and transparency in carbon reporting, especially in high-emissions sectors like manufacturing, transportation, and those reliant on fossil fuels.
Scope 3 emissions (those linked to a company’s supply chain and product use) are often the largest and most difficult to measure.
The Corporate Value Chain Scope, also known as the Scope 3 Standard, helps organisations account for these indirect emissions across 15 defined categories, from purchased goods and employee commuting to product disposal and end-of-life impacts. It enables companies to identify emissions hotspots and make informed decisions about reduction strategies.
This standard is increasingly important as frameworks like CDP and TCFD push for more transparent Scope 3 reporting.
Designed for businesses that want to understand the full climate impact of their products, the Product Standard provides a methodology for calculating GHG emissions from raw material extraction to end-of-life disposal.
By embedding carbon analysis into product design and development, companies can reduce both emissions and costs while responding to growing consumer demand for sustainable products.
When organisations implement climate change mitigation projects, such as renewable energy installations, energy efficiency upgrades, or reforestation, they need a way to quantify those reductions credibly.
The Project Protocol provides a robust approach to assessing the GHG impact of individual projects, allowing for comparison against a baseline or “business as usual” scenario. It’s used by both public and private sector actors to demonstrate climate impact with confidence.
With cities responsible for over 75% of global emissions, local action is vital to addressing climate change. The GPC helps cities, states, and regions measure GHG emissions across sectors like buildings, transport, waste, and industry.
By enabling consistent and comparable data, it supports urban climate planning, helps track progress, and encourages collaboration across local governments.
Many governments have set long-term emissions reduction goals, including Nationally Determined Contributions (NDCs) under the Paris Agreement. The Mitigation Goal Standard helps track progress toward these targets.
It provides a structured approach for evaluating whether policies and actions are delivering the expected results, and supports transparent reporting to national and international stakeholders.
When evaluating new climate policies or programmes, decision-makers need to understand their likely emissions impact. The GHG Protocol policy standard provides a consistent methodology to estimate and compare the effectiveness of different interventions, such as renewable energy subsidies, building codes, or carbon pricing.
It helps policymakers weigh options, improve planning, and communicate expected outcomes to the public and investors.
Summary of key GHG Protocol standards:
Standard | Purpose | Scope / Focus | Who uses it | Key features |
---|---|---|---|---|
Corporate Standard | Develops a complete GHG inventory | Scope 1 & 2 | Companies, NGOs, and public institutions | Defines boundaries, classifies emissions, sets base year, and tracks performance |
Scope 3 Standard | Measures emissions across supply chains and product lifecycles | Scope 3 | Corporations and large organisations | Covers 15 categories; focuses on indirect emissions across value chains |
Product Standard | Assesses emissions of individual products | Product lifecycle | Manufacturers, retailers, and design teams | Informs product development and emissions reduction strategies |
Project Protocol | Calculates emissions reductions from specific initiatives | Project-level | Corporations, local authorities, developers | Applies to renewable energy, reforestation, efficiency upgrades, and more |
GPC for Cities | Tracks emissions at the city or regional scale | Community-level | Cities, states, and national governments | Supports local climate planning and benchmarking |
Mitigation Goal Standard | Evaluates progress against climate targets | National/regional goals | National and sub-national governments | Designed to align with the Paris Agreement and NDCs |
Policy and Action Standard | Estimates the GHG impact of policy decisions | Government action | Policymakers and regulators | Helps compare options and improve accountability |
For companies looking to future-proof their operations and thrive in a low-carbon economy, the GHG Protocol offers a practical and credible foundation. It offers a clear, consistent framework for measuring and reporting GHG emissions, helping businesses move from ambition to action with data they can trust.
Here’s how the GHG Protocol helps businesses stay ahead:
The GHG Protocol helps organisations understand exactly where their greenhouse gas emissions originate, across Scopes 1, 2, and 3. This enables more focused reduction efforts, whether it’s improving operational efficiency, switching to renewable energy, or redesigning supply chains.
Transparent reporting backed by a globally recognised standard helps companies demonstrate accountability and credibility. In a world where 88% of institutional investors consider ESG factors in their decisions, trust matters more than ever.
The GHG Protocol is embedded in many leading sustainability initiatives, including:
Using the Protocol ensures alignment with current ESG expectations and helps companies stay ahead of regulatory change.
As governments introduce stricter reporting rules, including requirements for climate-related financial disclosures, companies need a consistent, auditable method for emissions reporting. The GHG Protocol provides exactly that.
By measuring the full emissions impact of their products and services, companies can make more informed design, sourcing, and production decisions, often reducing both emissions and costs in the process. This kind of product-level insight also helps brands meet growing consumer demand for sustainability.
The GHG Protocol is a tool companies can use to drive real greenhouse gas emissions reductions. But knowing where to start and how to apply the standards in practice can be a challenge.
Here’s a practical roadmap to help companies embed the GHG Protocol into their climate strategy:
Start by identifying which GHG Protocol standard (or combination of standards) best fits your company’s goals, size, and emissions profile.
If your company needs to... | Use this standard |
---|---|
Build a foundational emissions inventory | Corporate Standard |
Measure and manage supply chain emissions | Value Chain (Scope 3) Standard |
Understand the full carbon footprint of a product | Product Standard |
Quantify emissions reductions from a specific project | Project Protocol |
Track progress against long-term climate targets | Mitigation Goal Standard |
Example: Unilever uses the Value Chain Standard to evaluate emissions across its supply chain, identifying hotspots like raw material sourcing and logistics.
Once the right standard is selected, the next step is to create a robust GHG inventory, the foundation for any climate strategy.
This involves:
Example: Microsoft applies the Corporate Standard to measure Scope 1 and 2 emissions from its offices and data centres, using this data as a baseline for reduction initiatives.
With baseline data in place, companies can use their emissions inventory to set short and long-term reduction targets. These targets should align with recognised frameworks like the Science Based Targets initiative (SBTi), which encourages credible and ambitious climate goals.
The GHG Protocol’s structure ensures that targets are based on consistent, transparent emissions data, building internal confidence and external trust.
Once greenhouse gas emissions hotspots are clear, companies can move from measurement to mitigation. Strategies might include:
Example: IKEA integrates the Product Standard to measure the value chain emissions of its furniture, leading to initiatives such as sustainable material sourcing and circular economy practices.
Tracking progress and reporting results is essential to staying accountable, both internally and externally.
Companies should:
Regular, transparent updates show stakeholders that climate commitments are more than words; they’re backed by action.
In the UK, the Greenhouse Gas Protocol is the go-to standard for companies looking to report emissions in line with national regulations and climate commitments. It underpins key reporting schemes and is increasingly central to the country’s broader push toward net zero.
One of the most direct applications is in the Streamlined Energy and Carbon Reporting (SECR) framework, which requires large UK companies to disclose their energy use and GHG emissions annually. The UK government’s environmental reporting guidelines reference the GHG Protocol as a best-practice methodology, helping ensure emissions data is consistent, credible, and comparable.
It also plays a supporting role in aligning with Task Force on Climate-related Financial Disclosures (TCFD) requirements, which are mandatory for premium-listed companies and expanding to other sectors. The GHG Protocol’s structured approach to categorising and tracking emissions gives businesses a clear way to meet these climate disclosure rules.
Navigating the complexities of GHG accounting and emissions management can be challenging, but that's where Greenly comes in. Our carbon management services are designed to help your company measure, analyse, and reduce emissions effectively, aligning with global frameworks like the Greenhouse Gas Protocol.
Here's how we can support your sustainability journey:
Whether you're just starting your carbon management journey or looking to refine your strategy, Greenly's expertise and solutions can help your company make meaningful progress toward a more sustainable future. Get in touch with Greenly today to find out more.