Quick read: GHG inventory - What it is and why agri-food companies need it.
This quick-read text explains what a greenhouse gas (GHG) inventory is, why agri-food companies need it and how to get started with setting it up.
Short summary:
GHG inventory compiles all emissions a company and its suppliers produce.
Food companies need a GHG inventory for brand and stakeholder management and for climate compliance (see EU’s new Corporate Sustainability Reporting Directive).
The Greenhouse Gas Protocol provides international standards for creating the inventory.
GHG Protocol also offers specific guidance for agri-food companies: Land Sector and Removals Guidance.
GHG inventory - What is it?
A greenhouse gas (GHG) inventory accounts the greenhouse gas emissions that a company and its suppliers produce in their operations. The process of creating the inventory is known as GHG accounting.
A GHG inventory compiles all emission sources and their associated emissions, quantified using standardized methods: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O) and fluorinated gases.
Why do agri-food companies need a GHG inventory?
The food industry is one of the most polluting industries producing 1/4th of all global emissions.
Consumers and stakeholders are demanding more transparency regarding the climate impact of agri-food companies and their products. Companies are expected to understand and communicate their current emissions; for this task, they need a GHG inventory.
Additionally, new legislation has entered force in Europe. The Corporate Sustainability Reporting Directive will require nearly all EU companies to expand their environmental reporting, including calculating and reporting their current greenhouse gas emissions.
First companies will be obliged to report under CSRD in January 2024, meaning all agri-food companies should urgently start setting up their GHG inventory to report their emissions.
What does the process for starting a GHG inventory look like?
The process begins by choosing a standard that defines the boundaries of the emissions (Scopes 1-3) and specific quantification methods used for calculating them.
There are many standards to choose from, but the best practice is to follow the international GHG inventory standards from Greenhouse Gas Protocol. They supply the world's most widely used greenhouse gas accounting standards and have created detailed guidelines for specific industries.
Agri-food companies, for whom land use creates a significant portion of emissions, will receive their own guidance later in 2023. The Land Sector and Removals Guidance (see draft) will include specific guidelines for the food industry regarding how companies should account for and report emissions from land management, land use change and other land-related activities.
Starting a GHG inventory is part of a 3-step framework for calculating your company's impact on the climate. Read more about the process here.
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