E - Environmental (Carbon, Energy, Resources, Climate) 5 min read

What is Scope 3 (Value Chain Emissions)? Definition and Context

Credibility Check & Framework Comparison

To ensure absolute regulatory accuracy and reliability, we verify definitions across leading international frameworks before presenting our synthesized SME context.

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GHG Protocol

"All other indirect greenhouse gas emissions that occur in the value chain of the reporting organization, including both upstream and downstream activities."
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EFRAG / ESRS E1

"Disclosure of significant Scope 3 categories, including purchased goods and services, business travel, waste disposal, and product use."
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EcoVadis

"Sustainable Procurement evaluation criteria that assess how companies measure and manage the emissions of their suppliers."

ExecutESG Consolidated Definition

Scope 3 (Value Chain Emissions)

Scope 3 emissions are all indirect greenhouse gas (GHG) emissions (not included in Scope 2) that occur in the upstream and downstream activities of the reporting company's value chain.

The 15 Scope 3 Categories:

  • Upstream: Purchased goods and services, capital goods, fuel- and energy-related activities, upstream transportation and distribution, waste generated in operations, business travel, employee commuting, and upstream leased assets.
  • Downstream: Downstream transportation and distribution, processing of sold products, use of sold products, end-of-life treatment of sold products, downstream leased assets, franchises, and investments.

SME Relevance & B2B Inbound Action:

Scope 3 typically accounts for over 90% of an SME's total carbon impact. Furthermore, large corporate buyers subject to the CSRD are legally required to report their own Scope 3 emissions, which forces them to demand Scope 1 and 2 carbon data from their SME suppliers. SMEs can calculate and share their footprints in minutes using the ExecutESG VSME compliance engine.

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