Climate targets, investor scrutiny and new regulations are turning carbon accounting into a core business skill.
This primer explains what a corporate carbon footprint is, how it is measured and why it matters for finance, risk and strategy teams alike. You will find clear definitions, practical steps and a quick‑start checklist you can put to use in your next reporting cycle.
1. What is a carbon footprint?
A carbon footprint is the total amount of greenhouse gases (GHGs) your company emits over a set period, expressed in tonnes of carbon dioxide equivalent (tCO₂e). It covers carbon dioxide, methane, nitrous oxide and a handful of high‑impact industrial gases converted into one common metric so impacts can be compared and managed.
1.1 Scopes of emissions
| Scope | What it covers | Typical sources |
|---|---|---|
| Scope 1 | Direct emissions from assets you own or control | Stationary fuel combustion, company vehicles, fugitive refrigerants |
| Scope 2 | Indirect emissions from purchased electricity, heat or steam | Grid electricity, district heating |
| Scope 3 | All other indirect emissions in the value chain | Purchased goods, business travel, waste, use of your products, investments |
👉 For most companies Scope 3 can exceed 70% of the total footprint, so mapping supply chain and product use is essential.
2. Why it matters
Regulatory pressure – CSRD in the EU and the SEC climate rule in the US require Scope 1 and 2 disclosures and, increasingly, Scope 3 if material.
Investor expectations – Nearly nine in ten institutional investors now consider carbon data in capital allocation.
Cost and resilience – Energy efficiency and low‑carbon sourcing lower operating costs and hedge against future carbon pricing.
Customer demand – B2B buyers and consumers alike favour suppliers who can prove low‑carbon credentials and credible targets.
3. How to calculate your footprint
Set boundaries – Decide on organisational (equity share vs financial control) and operational boundaries. Align with the Greenhouse Gas Protocol Corporate Standard.
Gather activity data – Fuel invoices, utility bills, travel reports, supply chain spend, product lifecycle models.
Choose emission factors – Use reputable sources such as DEFRA, EPA or national inventories adjusted for your region.
Convert to tCO₂e – Multiply activity data by factors. Document assumptions.
Verify – Internal quality checks and, if material, external assurance under ISO 14064‑3 or ISAE 3000.
Report and reduce – Publish results, set reduction targets, integrate with strategy.
3.1 Tools and data solutions
ERP integrations for automated fuel and energy data capture.
Supplier engagement platforms for Scope 3 primary data.
Life‑cycle assessment (LCA) software for product footprints.
4. From numbers to action – building a reduction roadmap
| Step | Action | Example |
| 1 | Prioritise hotspots | Focus on top three emission categories (e.g. purchased steel, logistics, heating). |
| 2 | Set science‑based targets (SBTs) | Align with the SBTi 1.5 °C pathway. |
| 3 | Integrate into CapEx planning | Apply internal carbon price when evaluating new assets. |
| 4 | Engage suppliers | Include carbon clauses in contracts and co‑develop reduction plans. |
| 5 | Leverage renewables and efficiency | Power Purchase Agreements, LED retrofit, process optimisation. |
| 6 | Track, report, improve | Annual reassessment, continuous data refinement, transparent progress updates. |
5. Alignment with financial and risk management
Scenario analysis – Model commodity price swings and carbon taxes to quantify financial exposure.
Internal controls – Embed carbon data capture in the finance close process, mirroring ISSB connected‑information requirements.
Capital allocation – Link footprint metrics to hurdle rates and portfolio management.
Disclosure synergy – Harmonise with ISSB, ESRS and CDP for one streamlined report.
6. Common mistakes – and how to avoid them
Ignoring Scope 3 – Start with a spend‑based screening even if precision is low.
Mixing boundaries – Apply one consolidation method consistently.
Black‑box emission factors – Document source and year for every factor.
Under‑resourcing data governance – Treat carbon data like financial data.
One‑off footprint – Set up an annual or quarterly cadence so progress is measurable.
7. Key resources
Greenhouse Gas Protocol – Corporate Standard and Scope 3 Calculation Guidance.
Science Based Targets initiative – Target Setting Tool.
ISO 14064 for organisational and project‑level verification.
IPCC Fifth Assessment Report – Global Warming Potentials.
CDP disclosure platform and methodology.
Need support? EkoElevate helps companies build robust carbon accounting systems and turn carbon insights into strategy.
Get in touch to discuss how we can fast‑track your journey to net‑zero.
