Greenhouse gas emissions are categorised into different 'scopes' by the most widely-used
international accounting tool, the Greenhouse Gas (GHG) Protocol.
The GHG Protocol Corporate Standard classifies a company’s GHG emissions into three ‘scopes’:
Taking into account Scope 3 emissions for the carbon footprint of a portfolio investing in multiple companies doing business with each other, can give rise to double and even triple counting.
In the extreme case of these 3 companies being the only companies invested in, emission figures
are representing the same emissions (cf. red highlights in diagram).
This example clearly illustrates the problem of the double (triple, even) counting with which we are faced when calculating the carbon footprint.
Therefore, to avoid this, we exclude scope 3 emissions from our portfolio carbon footprint calculations.
For more information on how emissions scopes are taken into account in our SRI selection, please see "Carbon's SRI approach beyond the Carbon Footprint"