Carbon accounting

Carbon accounting is the practice of measuring, compiling and reporting how much greenhouse gas an organization emits, expressed in tonnes of CO2-equivalent (tCO2e) so that gases with different warming effects, such as methane and CO2, can be compared and summed on one scale. It is the data discipline behind most corporate climate disclosure.

Most carbon accounting follows the GHG Protocol, which organizes emissions into scope 1, 2 and 3 emissions and calculates them as activity data, litres of fuel, kilowatt-hours, kilograms of material, multiplied by an emissions factor drawn from government or scientific databases. This differs from a life-cycle assessment, which usually looks at the full cradle-to-grave footprint of a single product rather than an organization's annual operations.

Carbon accounting underpins ESG reporting, regulatory filings such as CSRD and SEC-style climate rules, and the baselines against which carbon credit purchases are judged. The main pitfalls are inconsistent organizational boundaries between reporting periods, reliance on generic emissions factors when supplier-specific data would be more accurate, and treating estimated scope 3 figures with the same confidence as metered scope 1 and 2 data.