1 out of 2 companies report all emission scopes
Last updated November 2023.
In a study by Carbonary of the latest available data from over 1900 public companies in 38 countries, around 50% of companies reported the total for Scope 1, Scope 2 and Scope 3 emissions.
Companies in Switzerland are well ahead when it comes to reporting all three scopes.
Two countries (Portugal and Greece) were discounted as they each had only one company in our database. A further seven countries have been excluded from the table as they each scored 0% (Singapore, Russia, Malaysia, Indonesia, Turkiya, Iceland, and Czechia).
Consumer discretionary have the highest % of companies reporting all three scopes.
Consumer discretionary distribution & retail is the most transparent industry group, with 70% of companies reporting their emissions in full.
Zooming out to sector level, the results are similar for most sectors with between 50-60% of companies fully reporting emissions, with the exception of Industrials (47%) and Energy (36%).
With increasing calls for transparency, it is likely these percentages will increase overtime as reporting becomes more normalized around the world. But perhaps the more pertinent question is, how quickly? In the US, the US Securities and Exchange Commission (“SEC”) Climate Disclosure Requirements will be phased in between 2024-2025, obliging large, publicly listed US companies to disclose their Scope 1 and 2 emissions. More stringent are the requirements under the Corporate Sustainability Reporting Directive (CSRD), which began entering into force in January 2024 and requires disclosure of Scopes 1, 2, and 3, extending these obligations to a broader set of large companies, listed SMEs, as well as companies outside of the EU with large EU subsidiaries or branches.
The benefits of fully reporting emissions
It may seem like a lot of effort, but reporting emissions in full is advantageous for the planet, the public, the investor, and the company itself:
It is the first step towards a meaningful decarbonisation process - reducing emissions, or even creating a strategy to do so, requires taking stock of your current carbon footprint, in its entirety.
It anticipates the growing risk of regulatory changes regarding reporting.
It massively improves company transparency which is important for brand reputation and also encourages investment as investors can more easily assess climate-related risks and opportunities.
It enables companies to track their progress and benchmark it with that of other companies in the same sector, industry group or geographical area.
Under-reporting: an underlying issue
What if some companies, although claiming transparency, fall short in accurately disclosing their emissions? This is particularly true for Scope 3 emissions, where a lack of comprehensive data or justifications for omission in various categories is common. Carbonary suggests that in 2022, EU-based companies under-reported Scope 3 emissions by approximately 30%, while non-EU ones lagged by around 43%, a stark contrast to the mere 2% under-reporting for Scope 1. This highlights the crucial need for not just more reporting but also the accuracy and reliability of the disclosed information.
