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‘Scope 3 reporting’ and other challenges in a post COP27 world

October 28, 2022

ESG Countdown starting the

The UN Climate Change Conference COP27 will take place between 6th Nov 2022 – 18th Nov 2022 in Sharm El-Sheikh, Egypt. Another year, another conference…but climate science is clear: we are heading in the wrong direction. The UN’s yearly Greenhouse Gas Bulletin warns of the biggest year-on-year jump in methane concentrations in 2021 since systematic measurements began nearly 40 years ago.

So, we need to go further faster – net zero means cutting greenhouse gas emissions to as close to zero as possible, with any remaining emissions re-absorbed from the atmosphere, by oceans and forests. Emissions need to be reduced by 45% by 2030 and reach net zero by 2050. While a growing coalition of countries, cities, businesses and other institutions are pledging to get to net-zero emissions, commitments made by governments to date fall far short of what is required.

Concrete actions are needed and one of them is to reduce GHG emissions and for that we need measurement. The Greenhouse Gas Protocol, a comprehensive global standardised framework for measuring and managing greenhouse gas (GHG) emissions, has identified three types of emissions that companies should measure:

• Scope 1 emissions – emissions that a company makes directly.

• Scope 2 emissions – emissions it makes indirectly – e.g. energy sources used by the company

• Scope 3 emissions – emissions associated, not with the company itself, but with its value chain e.g. its SME suppliers.

In the future, companies will have to report on all three emissions from Scope 1 to Scope 3. Scope 3 is the trickiest so big companies will need SMEs which are in their value chain to report to them. The SMEs that cannot provide information or have high emissions, or both, risk being thrown out of the value chain.

Apple has recently announced that it is urging its suppliers to take action to address their greenhouse gas (GHG) emissions towards the company’s 2030 value chain decarbonization goal. Apple will require companies in its supply chain to report on progress towards achieving carbon neutrality, including on Scope 1 and Scope 2 emissions reductions related to Apple production.

COP27 will be organised in a series of thematic days such as finance, science, water, etc. There is no SME or ESG day.

Therefore, CONNECTS intends to organise a webinar on November 24th, 2022 with high-level speakers examining key issues coming out of the conference relevant to ESG and SMEs with specific reference to both the global context but also to practical measures at the national and regional level that will need to be embraced such as Scope 3 reporting. This would involve ‘green’ finance and entrepreneurship, new energy systems, and technologies that can reduce carbon footprints and accelerate the move towards decarbonisation. The speakers for this event will be

  • Yvonne Slingenberg, Director, DG Climate Action of the European Commission, responsible for International climate negotiations and mainstreaming of climate issues in EU policies, Brussels
  • Alison Tate, Director, Economic and Social Policy at the International Trade Union Confederation, Brussels
  • Deep Parekh, Management Consultant, Belgium
  • Ulrike Sapiro, Chief Sustainability Officer at Henkel, Belgium

CONNECTS CONNECTS – Business Opportunities For Entrepreneurs is a global, simple, and cost-effective B2B digital platform for business development with the slogan ‘it takes a community to build a business’ providing access to trusted and reliable leads, partners, clients, suppliers, and skills. CONNECTS also develops Communities such as the ESG for SMEs, ESG Countdown developed by CONNECTS and founding partners Grant Thornton Belgium, BECI – Brussels Chamber of Commerce to create an ESG ecosystem, bringing all interested parties together to build awareness and educate companies in Belgium and beyond about the ESG journey see ESG Countdown (connects.world). CONNECTS has already organised successful webinars on ESG and so builds on its experience of working with partners to explain and promote the importance of ESG for SMEs.

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