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January 26, 2010
Sixty Companies Agree to Measure Emissions From Product Life Cycles and Supply Chains
    by Robert Kropp

Measurement and disclosure of Scope 3 emissions and emissions from product life cycles are based on standards developed by the Greenhouse Gas Protocol.

The November publication by the Greenhouse Gas Protocol (GHG Protocol), an accounting tool for the measurement and management of greenhouse gas (GHG) emissions, of two protocol standards for emissions accounting, has led to agreements by 60 corporations to measure the emissions of their products and supply chains.

The draft standards released by the GHG Protocol in November are the Product Life Cycle Accounting and Reporting Standard and the Scope 3 (Corporate Value Chain) Accounting and Reporting Standard.

The Product Life Cycle standard is designed to assist companies in the development of product level GHG inventories, with a goal of public disclosure. According to the GHG Protocol, measuring and reporting on emissions associated with the life cycles of their products can help companies identify opportunities for emissions reduction and cost saving throughout their supply chains, track performance for the establishment of metrics and targets for continual improvement, and differentiate their products in the marketplace.

The Scope 3 standard is designed to assist companies in the management of GHG emissions in their supply chains, tracking against emissions reduction targets, engagement with supply chain partners, and public reporting of GHG emissions.

Scope 3 emissions include such indirect sources as corporate air travel and employee commuting, the production and transport of materials in corporate supply chains, outsourced activities, and waste disposal. The GHG Protocol has considered Scope 3 measuring and reporting to be optional for companies. Without a clear set of standards for Scope 3 reporting, the data provided to investors and other stakeholders has at times lacked comparability, thus diminishing its usefulness.

According to the GHG Protocol, increasing interest by companies and increasing demand from stakeholders for Scope 3 emissions reporting led to the development of a standardized method to inventory the emissions of corporate supply chains.

Among the 60 companies that have agreed to measure the emissions of their products and supply chains are 3M, Bloomberg, Ford, GE, Kraft, Levi Strauss, Shell Petroleum, and Weyerhaeuser.

Following feedback from participating companies to ensure that the standards can be practically implemented, the GHG Protocol intends to publish its finalized standards in December, 2010.

Launched in 1998, the GHG Protocol is a partnership of the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD).


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