The 3 Step Guide to Decarbonisation

​A roadmap to Calculating, Reducing and Offsetting Emissions for Companies

Introduction

As humanity faces the harsh reality of a rapidly warming planet, companies have an increasingly important role to play in mitigating climate change and securing a liveable future for all.  

At GoodZero, we believe in making this process attainable for everyone through open knowledge sharing and providing personalised decarbonisation support for you every step of the way.  

This paper has been crafted with the goal of providing you with a short, simple, and informative guide to understanding the steps of your decarbonisation journey – from calculating, reducing, to offsetting your greenhouse gas emissions.    

From this paper, we hope you gain the clarity and confidence to embark on your decarbonisation journey. And, as always, we’re here to help if you have any questions.  

Step One: Calculate

We’ll start off by saying this - the most important thing is to simply begin your decarbonisation journey. However, before embarking on any carbon reduction efforts, it's crucial to first identify your emission sources and determine the amount of emissions your company is generating.

Why? In the not-so-distant future, emissions will need to be reported and reduction strategies clearly defined and monitored. Currently, these regulations vary and there are few accounting standards in place. Therefore, getting a jumpstart on your decarbonisation journey will help prevent you from making abrupt changes to your business activities and relations and ensure you remain ahead of the curve.

Establish a Baseline

Getting started on the decarbonisation journey can look different for everyone as each company is unique with their own goals, budgets, and operations. Therefore, establishing a baseline to work from, with your short and long-term goals in mind, is a great place to start. This includes identifying all the operational activities, products, and services that will be included in the report. Going forward, this helps to identify the sources of emissions that need to be measured and tracked.

Identify Emission Sources

Once you’ve established your baseline, the next step is to clearly identify all the sources of greenhouse gas emissions (GHG) according to Scope 1, 2, and 3.

Why? Categorising emissions by scope provides an integral framework for identifying your reduction opportunities, setting reduction targets and timelines, communicating with stakeholders, ensuring regulatory compliance, and identifying risks and opportunities associated with your company's operations.

Scope 1

Includes direct emissions from sources that are owned or controlled by the company. For example, Scope 1 emissions may include direct emissions from burning fossil fuels for heating or electricity, as well as emissions from company-owned vehicles.

Scope 2

Includes indirect emissions from purchased electricity, heat, or steam consumed by the company. For example, purchasing electricity from a local utility that generates power from coal-fired power plants versus renewable sources such as wind or solar, makes a significant difference in the level of your Scope 2 emissions.

Scope 3

Includes indirect emissions from sources that are not owned or controlled by the company, such as the emissions associated with the production of raw materials, transportation, and the use of sold products.

For example, a food and beverage company may have Scope 3 emissions from the production of agricultural inputs like fertilizers and pesticides, as well as the transportation and refrigeration of finished products. By working with suppliers to reduce emissions in their supply chain, and by promoting more sustainable consumption practices among customers, the company can help to reduce its overall Scope 3 emissions and contribute to a more sustainable food system.

Scope 1, 2, and 3 emissions according to the GHG-protocol.

Gather Data & Verify

Once you’ve identified your emission sources and categorised them according to scope, it’s now time to start collecting the relevant data from each source. This may involve digging into internal sources such as operational records, financial reports, and energy bills, as well as external sources such as suppliers, customers, and regulators.

Before you begin calculating your emissions, we encourage you to review the data a final time for completeness, accuracy, and consistency, and address any discrepancies or data gaps that are identified.

This is often the most difficult and arduous process of calculating your carbon footprint, which is precisely why many companies work with third-party consultancy companies to assist them in this process. At GoodZero, we’ve partnered with the carbon-calculation experts at MyCarbon to provide our clients with one of the highest-quality and most reliable carbon calculation services.

Ensuring the data is accurate is something we take very seriously at GoodZero, and rightfully so – it serves as the foundation for your company to effectively measure and manage your emissions, enabling you to identify opportunities for reductions and track progress towards your sustainability goals. Calculating and reporting on inaccurate data can potentially lead to missed opportunities, greenwashing, and limited progress in addressing climate change.

Therefore, no matter who you work with (or don’t), it’s crucial to verify that your data is collected consistently and accurately.

Calculate

There are various tools available to calculate your company’s emissions, ranging from basic spreadsheets, sophisticated software systems, to third-party consultancy partners. Determining the most appropriate tool is often based on your company size, complexity of operations, internal expertise, resources, and sustainability goals.

The GHG Protocol, ISO 14064, and the Carbon Trust Standard all provide a framework for identifying, measuring, and reporting emissions, as well as guidance on setting reduction targets and implementing emission reduction strategies. It should be noted that the GHG Protocol is by far the most widely followed by companies and consultancy services, and once those emissions are calculated, it’s time to begin the next step in your decarbonisation journey – reduce!

Step Two: Reduce

Now that you’ve carefully calculated your greenhouse gas (GHG) emissions, it’s time to set short- & long-term goals, formulate a reduction strategy, and take effective action.

Analyse Your Carbon Footprint  

The first step in reducing emissions is to analyse your company's carbon footprint and identify areas where improvements can be made. This typically occurs in the area where your highest emissions come from and is often industry-dependent. Depending on your company, you can decide to analyse their footprint in-house or receive support from a third-party decarbonisation service. Whichever way you choose, by obtaining a thorough understanding your company's current environmental impact, you can identify areas where carbon emissions can be reduced and develop an effective roadmap towards improvement.   

Set Targets and Goals   

Once you have a comprehensive understanding of your company’s current environmental impact, the next step is to establish short- and long-term targets and goals for reducing your company's carbon emissions. These targets and goals should be specific, measurable, and achievable within a reasonable timeframe. For example, your company could aim to reduce its carbon emissions by 20% over the next five years. By setting well-defined and foreseeable targets, you can monitor your company’s progress and make adjustments as needed.   

Net-zero  

Net-zero is the ambitious goal of balancing every greenhouse gas released with an equal amount removed from the atmosphere. It’s a long-term goal that should  be pursued after you’ve reduced your avoidable emissions as much as possible. Achieving net-zero involves measuring, reducing, and offsetting emissions across your entire value chain, including those from the production of goods, transportation, and energy use.   

Most often, the only way for a company to reach net-zero is to offset their remaining emissions through high-quality carbon credit projects. However, finding such projects can be challenging. That’s why we’ve done the legwork for you and sourced credible, high-impact projects led by developers with whom we have built long-lasting, personal relationships. By connecting you with these projects, we can help you accelerate your decarbonisation journey & quickly reach your goals.

Meanwhile, you can also choose to align your short and long-term reduction goals with SBTi or B-Corp. This can be advantageous as guidelines are already defined, additional support is available, you can connect with like-minded partners, and clearly communicate your impact with your network.    

Science Based Targets initiative  

The Science Based Targets initiative (SBTi) is a globally recognized, collaborative partnership that helps companies set specific, science-based targets for reducing their greenhouse gas emissions. By aligning with the latest climate science, SBTi provides a clear roadmap for companies to reduce their carbon footprint in a way that is effective and necessary for preventing the worst impacts of climate change.  

To get started with SBTi, companies first conduct a comprehensive assessment of their carbon footprint, including all emissions associated with their operations and supply chains. Based on this assessment, companies set realistic reduction targets that align with limiting global warming. These targets are then submitted to SBTi for review and approval, providing an extra layer of credibility and guidance.  

At GoodZero, we advocate for setting science-based targets as a powerful tool for addressing climate change. That's why we offer support for SBTi validation, to help ensure that your reduction strategy is approved as quickly and efficiently as possible. By setting science-based targets through SBTi, you can be confident that you are taking meaningful steps towards a more sustainable future.   

B-Corp   

A B-Corporation, or B-Corp for short, is a certification that recognises a for-profit company's commitment to meeting high social and environmental standards.  

For companies striving to reduce their carbon footprint, becoming a B-Corp can serve as a valuable guide for developing a comprehensive sustainability strategy. B-Corps are held to rigorous environmental performance standards, which may include reducing greenhouse gas emissions, using renewable energy, minimizing waste and pollution, and improving the energy efficiency of their operations.  

To become a B-Corp, you must undergo a thorough assessment process to verify that you meet the required standards, change your governance structure to be accountable to all stakeholders, as well as commit to ongoing monitoring and reporting. Although this process may be demanding, becoming a B-Corp can provide a powerful framework for achieving your carbon reduction goals while also driving positive social and environmental impact.  

Strategies and Reduce

Improve Energy Efficiency  

Improving your company's energy efficiency is an excellent way to reduce GHG emissions. This could include upgrading to more energy-efficient equipment, implementing energy management systems, and improving insulation and weatherization. By reducing energy consumption, your company can reduce its carbon footprint as well as save on energy costs in the long run.  

Switch to Renewable Energy Sources  

Another way to significantly reduce carbon emissions is to switch to renewable energy sources. You can lead the charge on this effort by exploring options such as installing solar panels or wind turbines on your company's premises, purchasing renewable energy credits, or contracting with renewable energy providers.   

Improve Transportation Methods  

Transportation is another major contributor to carbon emissions, but fortunately there are many ways to tackle these emissions. These may include using hybrid or electric vehicles, switching to sustainable fuels, promoting public transportation and carpooling, allowing employees to work from home or remotely, and optimizing delivery routes to reduce fuel consumption. A nice co-benefit to reducing emissions: you can also save on transportation costs!  

Implement Sustainable Supply Chain Management  

Implementing sustainable supply chain management is a great way to reduce those elusive Scope 3 emissions. Although they are some of the most difficult to reduce, solutions are readily available and easy to implement. These may include sourcing materials from local and sustainable suppliers, reducing packaging waste, and reducing transportation emissions within the same sector they are emitted in (carbon insetting) By implementing sustainable supply chain management, your company can reduce its environmental impact and demonstrate its commitment to sustainability to customers and stakeholders.  

Engage Employees and Stakeholders

Finally, it is important to engage employees and stakeholders in your sustainability efforts. Afterall, you’ve done all this work, now it’s time to spread the sustainability love! A few ways you can do this is by providing sustainability training to employees, encouraging employee participation in sustainable initiatives, and collaborating with stakeholders to identify opportunities for improvement. By engaging employees and stakeholders, your company can build a culture of environmental awareness and ensure that everyone is working towards a joint climate goal.  

Step Three: Offset 

Now that you’ve reduced your avoidable emissions as much as possible, it’s time to offset your remaining emissions through high-impact carbon credit projects.  

The Voluntary Carbon Market  

The voluntary carbon market (VCM) provides a platform that allows individuals, organisations, and companies to purchase and sell carbon credits. A carbon credit is a unit that symbolizes the removal or reduction of one tonne of carbon dioxide equivalent (CO2e) emissions from the atmosphere. Credits are used to offset, or compensate, for carbon emissions by funding carbon reduction projects elsewhere.   

The pricing of these credits is determined by several factors, including the credit's quality, the type of project it supports, and the demand for it. Essentially, it is a way for you to take responsibility for your carbon footprint by funding carbon reduction projects around the world, such as renewable energy, carbon capture, nature-based projects, and energy efficiency initiatives.    

Through participating in the voluntary carbon market, you can both reduce your net carbon emissions and contribute to sustainable development in communities and ecosystems worldwide.  

Carbon Credit Projects  

Carbon credit projects are climate initiatives that enable companies to purchase credits to offset their emissions. They can be further categorised as avoidance or removal projects, each with its own set of objectives and environmental impacts.   

Avoidance projects aim to prevent or reduce greenhouse gas emissions, such as by promoting renewable energy, energy efficiency, or clean transportation initiatives. For example, a cookstove project can be an avoidance project by providing clean, data-driven cookstoves that use sustainable biomass and solar power, which avoids the emissions of greenhouse gases and pollutants associated with traditional cookstoves.  

On the other hand, removal projects focus on removing greenhouse gases from the atmosphere, often using innovative technologies in forestry, land management, or carbon capture. For instance, a carbon removal project that uses kelp to sequester carbon dioxide from the atmosphere can be an effective and scalable solution. Kelp grows faster than most land-based plants and absorbs more carbon per unit area, making it an exciting and promising option for mitigating climate change.  

At GoodZero, we are true advocates and supporters for helping companies reduce their emissions as much as possible. However, we recognise that some emissions are simply unavoidable. In these cases, offsetting your emissions is an effective (and oftentimes the only) way to reach your sustainability goals and mitigate the impacts of climate change.   

 
Common Third-Party Standards and Verifications  

Determining whether a carbon credit project genuinely delivers on its environmental promises can be challenging. This is where third-party verification standards and professional due diligence play a crucial role.   

Third-party verification standards, such as Gold Standard, Verified Carbon Standard (VCS), and American Carbon Registry, are essential in assessing the environmental integrity and social co-benefits of carbon credit projects. However, a growing number of credit providers are performing their own due diligence to further evaluate projects on impact, integrity, and sustainable development goals (SDGs) before they accept it as a project they’re proud to offer clients. This may include developing their own criteria, reviewing project documents, analysing emissions reduction methodologies, fostering direct relationships with project developers, and conducting site visits.   

This extra level of scrutiny can help to identify potential risks, ensure that the project is delivering meaningful emissions reductions, and keep you up to date on project developments. When selecting projects, our take-home is that you should feel confident that your support is contributing towards a real, positive environmental impact. 

Develop a Carbon Offsetting Strategy  

To offset your carbon emissions in a meaningful way, it's key to develop a tailor-made carbon offsetting strategy that best suits your company's needs and objectives. This involves setting priorities for selecting projects based on their environmental impact, cost-effectiveness, and alignment with your company's values.  

If you'd like to offset in a certain ecosystem or with projects that have certain co-benefits, be on the lookout - some providers offer various project categories to select from, such as Methane Capture, Energy Efficiency, Community, Local, Data-driven, and Forestry and Conservation. This approach allows you to offset your emissions in an area that aligns with their sustainability goals and values, as well as enables you to spread your impact across multiple projects within a category.  

It is important to ensure that your offsetting strategy is integrated with your overall sustainability strategy and long-term goals. For example, if your company is committed to promoting social equity, you may want to prioritise offsetting projects that benefit local communities and promote gender equality. By taking a thoughtful and strategic approach to carbon offsetting, your company can make a meaningful impact on the environment while upholding its values and identity. 

Implement and Monitor Your Offsetting Strategy  

Implementing your offsetting strategy in a timely and efficient manner is the next critical step to achieving your sustainability goals. This involves selecting reputable offsetting providers, setting clear targets and timelines, and monitoring progress toward these goals. However, this does require some work. In case this is outside the scope of your capabilities, be sure to choose an offset provider that offers this as a service for you.    

  
Engage Employees and Stakeholders  

Finally, it is important to engage employees and stakeholders in your sustainability efforts. Afterall, you’ve done all this work, now it’s time to spread the sustainability love! A few ways you can do this is by providing sustainability training to employees, encouraging employee participation in sustainable initiatives, and of course, communicating about the impact from the projects you support. By engaging employees and stakeholders, your company can build a culture of environmental awareness and ensure that everyone is working towards a joint climate goal.  

Conclusion  

Whether you’re a Sustainability Manager, C-level executive, Director, or inspired employee, you have a critical role to play in reducing your company's carbon emissions and creating a more sustainable future. Taking action on decarbonisation not only benefits the environment but can also lead to improved financial performance, increased stakeholder trust, and a more resilient business overall.  

At GoodZero, we believe all companies should be supported in their decarbonisation journey – and quickly. That’s why we provide end-to-end services in your decarbonisation journey – from carbon calculation (together with MyCarbon), carbon reduction (insetting), offsetting and communicating your impact story – we ensure no stone goes unturned. By leveraging our expertise, your company can accelerate its efforts to reduce its carbon footprint and contribute to a more sustainable future.  
  
Start Today  

Remember, you do not need to create an overly ambitious plan to reach net-zero or be (close to) perfect just to simply start your decarbonisation journey. The most important thing is that you have sustainability goals and you’re ready and willing to make the necessary changes to get there – whether big or small. Start today.