Questions to ask your
carbon accountant
How to make sure your carbon footprint is sound
We talk about carbon accounting being in the ‘Wild West’ because of a lack of standards across the industry and incompatibility between different accounting methods. But we've also seen some real cowboy practices that we want everyone to be aware of. Anyone can spot them by asking some simple questions to whoever you're thinking of hiring to be your carbon accountant or calculate your carbon footprint.
Here are four simple questions to ask your carbon accountant, and the answers you’re looking for:
1. What are spend-based emissions factors?
A spend-based emissions factor is a number that gives you the amount of greenhouse gas emissions per £ spent. Each industry sector has an emissions factor, so if you spend £100 on advertising and £50 on paper, you multiply your spend by the emissions factors for those two sectors to get your total emissions for each. They include direct emissions (Scope 1), indirect emissions from electricity generation (Scope 2) and emissions from the full supply chain (Scope 3).
Our guide below explains the difference between spend-based emissions and life cycle analysis, and shows you what Scopes 1, 2 and 3 mean.
2. Which years do you have data for and which of those have underlying data?
There is always a lag in new data being published. The most recent UK data currently available is for 2021. Your carbon accountant should be able to tell you how they have adjusted for inflation for all subsequent years after the last raw data year. They should also be able to show you different emission factors for each year in their model; factors should never be identical for subsequent years.
3. Where do you get your data from?
Worryingly, we’ve seen instances where companies use the ONS ‘Atmospheric emissions: greenhouse gas emissions intensity by industry’ dataset. This was never intended for carbon accounting.
This dataset gives direct emissions (Scope 1 only) per unit of gross value added for different UK industries. It’s designed to show which industries give a ‘good bang for their buck’ in terms of their direct emissions relative to their contribution to the economy.
The good news is that we’ve discussed this with the ONS, who are keen to update the text that accompanies this dataset to clarify what the data shows and lessen confusion.
Reliable data which includes Scopes 1, 2 and 3 for each industry can be sourced from:
SWC MRIO
Our SWC MRIO (Multi-Regional Input-Output model) compiles data from worldwide sources, mainly the OECD. The full model covers 103 different industries across 75 countries, with data for 2018-2023 (latest data year is 2020, with subsequent years inflation-adjusted). We have a free version which covers the UK only, for 2022. We also have two licenced versions: one covers the top 6 countries by GDP, and the other covers all 75 countries.
Exiobase
This covers 44 countries and 5 'Rest of World' regions, and is free to download.
Defra
For the UK only, Defra's dataset ‘UK and England's carbon footprint to 2021’ states that the factors are from “wherever in the world these emissions arise along the supply chain”, showing that they include Scopes 1, 2 and 3 emissions. This data has years up to 2021; Defra doesn’t inflation-adjust for later years.
4. Can I see your methodology?
Your carbon accountant should be able to show you the methodology behind their model and how they use it, in an understandable way. Even if you're not an expert in emission factors and carbon footprints, there are some key parts that should make sense.
You should be able to see where the data is from, how the model works, how subsequent years have been adjusted for inflation, and any improvements that have been made to the underlying data.
We publish our methodology, which includes an overview of how the model works, where we source our data, how the final emission factors are calculated and the improvements we've made in the latest version. Our improvements cover maritime emissions, emissions from oil and gas leaks, fluorinated gases, and radiative forcing factors for aviation. We give an overview of why we've made these adjustments to make the emissions more reliable.
Here's our methodology, along with our guide to supply chain emissions reporting (these are process guidelines and can be used with any model), our guide to hybridising LCAs and emission factors, and comparison and validation of our SWC MRIO emission factors against other models.
We want higher standards to help lower emissions
We want to empower clients to know that the carbon accounting services they are paying for are fit for purpose. Any carbon accountant should be able to show you their data and methodology and answer your questions in an understandable way.
If you're not measuring your emissions in a robust and meaningful way, you won't be able to identify and target the areas where it's possible to make reductions. And if your suppliers make reductions, you won't see that reflected in your Scope 3 supply chain emissions.
We know that carbon accounting is just a tool. But when used correctly it can be a tool to help bring down your emissions and to push others in your supply chain to reduce their emissions too. That's why we're pushing for higher standards across the whole carbon accounting industry.