Over the past 10 years, an increasing number of organizations have been measuring and tracking their greenhouse gas (GHG) emissions through the Corporate Standard framework designed by GHG Protocol. Equipped with information about their GHG profile, companies have sought ways to reduce their emissions, including the creation of voluntary GHG reduction targets. Such targets are at the core of well designed corporate mitigation strategies as they offer a common approach to tackling a diverse array of GHG related risks and opportunities along the value chain. The GHG Protocol Corporate Standard already provides basic guidelines on setting a reduction target (Ch.11), and discusses how these reductions can either be internal—making operational changes in equipment, fuel or behavior—or external, including the purchasing or funding of quantified reduction projects outside of the company’s operations.

The external options here are particularly numerous, including emission allowances from voluntary or regulatory cap and trade schemes (e.g., CCX, RGGI, EU ETS), offset credits generated from GHG reduction projects (e.g., CDM), electricity green pricing products, and certificates intended to help track the generation of electricity from renewable energy installations (e.g., RECs, ROCs, etc). Ultimately, these instruments should be functionally equivalent to an internal, operational reduction.

Challenges in tracking corporate performance

Despite the range of available mitigation measures, companies face significant challenges in almost every phase in the design and implementation of reduction targets, posing risks to the integrity and credibility of their mitigation strategies. Among these challenges include :

• What types of targets?
• What types of reduction instruments?
• How to calculate reductions?
• How to account for reductions?
• How to report reductions?

The Performance Tracking Guidelines

In order to enhance the clarity, consistency and credibility of voluntary GHG reduction commitments, the GHG Protocol Initiative at the World Resources Institute (WRI) has begun a process to develop Performance Tracking Guidelines. These guidelines are intended for companies evaluating how they should structure and report on their mitigation strategies, as well as for GHG reporting programs and initiatives interested in designing program specifications on reduction targets. The guidelines aim to harmonize practices used by companies worldwide for setting and meeting reduction targets, and enable internal management and external stakeholders to make meaningful assessments of company performance.

Development Process

To develop these guidelines, the GHG Protocol will be assembling a Technical Advisory Group (TAG) composed of GHG reporting programs and other organizations with expertise in mitigation strategies and external reduction instruments. The TAG will help shape the Guidelines scope, comment on drafts of the Guidelines, and share best practices. The GHG Protocol will incorporate the TAG’s input while ensuring consistency with the GHG accounting principles previously established through the Corporate Standard and the Project Protocol. Broader stakeholder input will be solicited through an open comment period to be held later in the guidelines’ development, as well as stakeholder workshops in US and European cities.

Performance Tracking Documents

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Stakeholders were encouraged to submit written comments to WRI and WBCSD on the first drafts of both standards. Written comments were accepted from November 11th to December 21st, 2009. Over 60 organizations and individuals submitted comments on the standards.

Scope 3 Standard Comments

Product Standard Comments

Developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), the two new GHG Protocol standards – the Product Life Cycle Accounting and Reporting Standard and the Scope 3 (Corporate Value Chain) Accounting and Reporting Standard – provide methods to account for emissions associated with individual products across their life-cycles and of corporations across their value chains.

Jonathan Lash, president of WRI, said, “We are encouraged by the overwhelming response from the private sector seeking to road test the new standards. There were more than 120 applications across a broad array of sectors and regions worldwide. The road testing will provide critical input in ensuring that the standards generate credible and meaningful data for business and government decision makers, while considering the practical challenges that businesses and programs will face during implementation.”

“Increasingly, companies are looking beyond their own boundaries and developing strategies to reduce GHG emissions in their supply chains and in the products they make and sell,” added Bjorn Stigson, president of WBCSD. “By taking a comprehensive approach to GHG measurement and management, businesses and policymakers can focus attention on the greatest opportunities to reduce emissions within the full value chain, leading to more sustainable decisions about the products companies buy, sell, and produce.”

An example of GHG emissions across a product’s life cycle

While many companies have been measuring the emissions from their own operations and electricity use, the Scope 3 Standard will, for the first time, allow companies to look comprehensively at the impact of their corporate value chains, including outsourced activities, supplier manufacturing, and the use of the products they sell. Road testers of the Product Standard will measure the climate change impact of products ranging from magazines, food and jeans to computers, wind turbines and steel.

Ashley Crepiat, environmental footprint and economics manager for road-testing company Airbus, said, “Managing the transition towards a low-carbon economy is now a true concern for corporations. Airbus understands that beyond reducing its direct GHG emissions from its operations, evaluating emissions throughout the whole value chain is also a major challenge. By road testing GHG Protocol’s Scope 3 Accounting and Reporting Standard, we believe this will help establish harmonized international guidelines enabling a common and robust framework for Scope 3 accounting.”

Michael Kobori, Levi Strauss & Co.’s vice president of Social and Environmental Sustainability, said: “Levi Strauss & Co. is thrilled to be road-testing the GHG Protocol Product Life Cycle Accounting and Reporting Standard. If this method becomes widely accepted, it will enable us to better calculate and share the climate change impact of our products. Being able to credibly measure and communicate that product impact to consumers can unleash the power of the market to address climate change on a global scale.”

The draft standards were developed over the last year through a global, collaborative multi-stakeholder process, with participation from over 1,000 volunteer representatives from industry, government, academia and non-governmental organizations. The road testing process will provide real-world feedback to ensure the standards can be practically implemented by companies and organizations from a variety of sectors, sizes, and geographic areas around the world. The final standards are scheduled to be published in December 2010.

Companies participating in the road testing represent 17 countries from every continent and more than 20 industry sectors. The companies include: 3M Company; Acer Inc.; Airbus S.A.S.; AkzoNobel; Alcan Packaging; Alcoa; Anvil Knitwear, Inc; Autodesk, Inc.; Baoshan Iron & Steel Co. Ltd.; BASF SE; Belkin International; Belron International; Bloomberg LP; BT Plc; CA, Inc.; Coca-Cola Erfrishungsgetränke AG; Colors Fruit SA (Pty) Ltd.; Deutsche Post DHL; DuPont; Eclipse Networks (Pty) Ltd.; Ecolab; The Estee Lauder Company; Ford Motor Company; General Electric; U.S. General Services Administration; Gold’n Plump Poultry LLC; Highways Agency (UK); Hydro Tasmania; IBM; IKEA; Italcementi Group; JohnsonDiversey, Inc.; Kraft Foods; Lenovo Corporation; Levi Strauss & Co.; Mitsubishi Chemical Corporation; National Grid; Natura Cosméticos; New Belgium Brewing Co.; Otarian; PepsiCo, Inc.; Pinchin Environmental Ltd.; PricewaterhouseCoopers (Hong Kong); Procter & Gamble Eurocor; Public Service Enterprise Group, Inc.; Rogers Communications, Inc.; SAP AG; SC Johnson; Shanghai Zidan Food Packaging & Printing Co., Ltd.; Shell International Petroleum Company Ltd; Suzano Pulp and Paper; Swire Beverages (Coca-Cola Bottling Partner); TAL Apparel Limited; Tech-Front (Shanghai) Computer Co., Ltd./Quanta Shanghai Manufacturing City; Tennant Company; Veolia Water; Verso Paper Corp.; VT Group Plc; Webcor Builders; Weyerhaeuser Company and WorldAutoSteel.

Stakeholders discuss the Product Standard and Scope 3 Standard drafts at the Meeting in London, November 2009

The World Resources Institute and the World Business Council for Sustainable Development held five stakeholder workshops between November 17 and December 1, 2009 to seek feedback on two new GHG Protocol standards:

• Scope 3 Accounting & Reporting Standard – Draft for Stakeholder Review
• Product Life Cycle Accounting & Reporting Standard – Draft for Stakeholder Review

The workshops were held in the following cities:

• Berlin, Germany (17 November 2009)
• Guangzhou, China (17 November 2009)
• Beijing, China (19 November 2009)
• London, UK (20 November 2009)
• Washington, DC, USA (1 December 2009)

Over 350 participants attended the workshops. Each workshop contained plenary discussions on each standard as well as several smaller interactive discussion sessions on key technical issues.

Click here for a summary of feedback received at the workshops.

Stakeholders were also encouraged to submit written comments to WRI and WBCSD on the draft standards. Written comments were accepted from November 11th to December 21st, 2009. Over 60 organizations and individuals submitted comments on the standards. Click here to read the written comments.

Feedback from the workshops and written comments will be submitted to the steering committee and technical working groups for consideration in the next revision process.

Click here to download the draft standards and the comment templates.

The next step in the standards’ development process is the first stakeholder public comment period. Over the next two weeks workshops are being held in China, Europe, and the U.S. and will provide Stakeholder Advisory Group members with an avenue to provide some valuable feedback. Stakeholder feedback is a critical part of the standards’ development process, and stakeholders are encouraged to submit written comments on the draft standards throughout this important comment period.

After the workshops and the public comment period are completed, WRI and WBCSD will summarize and share the feedback with the technical working groups and steering committee for consideration as they complete the next drafts of the standards.

The drafts and draft summaries can be found in the table below. To provide written feedback, please use the comment forms. Comments must be submitted in the comment templates in order to be considered. During the comment period the standards will continue to be revised by WRI and WBCSD for formatting and style issues. To save time, please focus your comments on the substance of the standards.

The comment period will run from November 11th to December 21st, 2009. Please submit all comments to Holly Lahd at hlahd@wri.org by Monday, December 21st.

Draft Standards

Laura joins the GHG Protocol team as a Life Cycle Assessment Associate working on the Product and Supply Chain Initiative. Prior to joining WRI, Laura performed life cycle inventory and cost assessments for the National Energy Technology Laboratory (NETL) on electricity generation and liquid fuel production technologies. With NETL, Laura drafted a guideline document for performing consistent energy-based life cycle assessments and was involved in developing a framework document for consistent GHG accounting of alternative aviation fuels. Laura also completed a post doc with the EPA Office of Research and Development, where she performed MARKAL energy systems scenario modeling of the impacts of carbon legislation, efficiency measures, and technological advances on regional U.S. energy use and emissions. She has experience calculating the life cycle energy use and emissions associated with utility, industrial, and bio-energy processes. Laura holds Doctoral and Bachelors degrees in Chemical Engineering from Georgia Institute of Technology and Villanova University, respectively.

Over 240 stakeholders participated in the webinars. For those who were not able to attend, the webinar was recorded and is now posted on the GHG Protocol website.

The next steps for the Stakeholder Advisory Group will occur when WRI and WBCSD host four one-day stakeholder workshops to get valuable inputs on the drafts of the Scope 3 and Product Standards. Both drafts will be released for stakeholder comment prior to the workshops. Workshop dates and locations are highlighted in the table below. Please note that registration for the workshops is now closed due to full capacity.

Stakeholder Advisory Group meetings

GHG Protocol Director Pankaj Bhatia opens the Steering Committee meeting on October 7th 2009

Further progress was also made by the Steering Committee this quarter who met at WRI offices in Washington, D.C. on October 7th and 8th to review and provide input on the Scope 3 and Product standard drafts. Other objectives of the meeting were to build consensus on key recommendations included in the two standards and to develop a strategy for harmonization between the GHG Protocol Product Standard and ISO 14067.

“Having standards for supply systems and product greenhouse gas footprinting will be critical to ensuring consistency and comparability across products and across systems and markets,” states Steering Committee member Miranda Ballentine, Walmart’s Director of Sustainability.

“These standards help facilitate a deeper dive looking at individual products as well as increasing the breadth of our investigation by looking at our Scope 3 emissions,” says Rob Rouse, Regulatory Affairs Leader at Dow Chemicals. “[The standards] will help us to look up and down our value chain and work with our partners to identify opportunities for reductions.”

Revised drafts of the two standards based on the feedback were sent to the Stakeholder Advisory Group in early November in preparation for the workshops highlighted above. A public comment period will run through December 21.

Drafts, summaries and comment templates can be found on the website. The next Steering Committee meeting will be held in the summer of 2010 to discuss feedback from the road testing process conducted during early 2010.

To become a member of the Stakeholder Advisory Group please complete the form below.

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