Two-minute brief
GHG Protocol requirements explained: video brief
A two-minute brief on the GHG Protocol Corporate Standard, the Scope 2 Guidance and the Scope 3 Standard.
Key takeaways
- Five principles apply: relevance, completeness, consistency, transparency and accuracy.
- Organisational and operational boundaries come before calculation.
- Scope 2 follows the Scope 2 Guidance; scope 3 follows the Scope 3 Standard.
- A base year anchors tracking over time.
- There is no certificate; independent verification is optional or required by users.
An accounting standard, not a management system
The GHG Protocol Corporate Standard is an accounting standard, not a management system standard, so it has no harmonised clause structure. It runs to eleven chapters, some setting requirements and others giving guidance only; the Scope 2 Guidance amends it and the Scope 3 Standard extends it along the value chain. This short film maps what each part asks for.
Chapter 1 sets the accounting and reporting principles: relevance, completeness, consistency, transparency and accuracy, applied to every accounting decision. Chapter 2 asks the inventory to be designed around its uses, such as disclosure, targets, customer requests, risk and reduction planning, with a statement of intended users and uses. The organisational boundary then sets which entities are included under the chosen consolidation approach, and the operational boundary sorts emissions into the three scopes.
Scopes, base year and reporting
Scope 1 covers direct emissions from sources the company owns or controls. Scope 2 covers the generation of purchased electricity, steam, heat and cooling, reported as the Scope 2 Guidance requires. Scope 3 covers all other indirect emissions, up and down the value chain, organised in the categories of the Scope 3 Standard. Emissions are tracked over time against a base year, which is recalculated when significant structural or methodological changes occur. Identification and calculation of emissions, inventory quality management and reporting complete the picture, with the report disclosing the boundary, methods, results and changes.
The current Corporate Standard is the revised edition of 2004, amended by the Scope 2 Guidance of 2015, with the Scope 3 Standard of 2011; a joint GHG Protocol and ISO standard is planned. No certification exists. Where required, an independent verification body, commonly working to ISO 14064-3, verifies the inventory and issues a statement.
The consolidation approach is chosen first: equity share, financial control or operational control. Scope 2 is reported on a location-based method, using average grid factors, and, where contractual instruments exist, on a market-based method as well.
GHG Protocol at a glance
- Purpose
- Accounting for and reporting an organisation's greenhouse gas emissions by scope 1, 2 and 3, on boundaries and methods an outsider can test
- Relevant to
- Organisations of any size asked for emissions figures by customers, investors, lenders, disclosure rules, target schemes or their board
- Edition
- Corporate Standard, revised edition (2004), amended by the Scope 2 Guidance (2015), with the Scope 3 Standard (2011); a joint GHG Protocol and ISO standard is planned for Q4 2028
- Verification
- No certification exists. Where required, an independent verification body, commonly working to ISO 14064-3 and accredited to ISO/IEC 17029 and ISO 14065, verifies the inventory and issues a statement
- Sterling's role
- Boundaries, calculations, the inventory report and its evidence built with your team, Effivity, training, internal review and verification readiness, then Sustain™
- Cost and timing
- Total investment for a GHG Protocol inventory depends on the current maturity of your processes, the scope, locations and number of employees. The process typically takes 3 to 6 months
GHG Protocol: questions people ask
Is there a GHG Protocol certification?
No. The GHG Protocol publishes accounting standards; it does not certify organisations or verify inventories, and the Corporate Standard states that it does not set out how verification should be conducted. What you can have is an inventory prepared in conformance with the standards and, where someone relies on it, a statement from an independent verification body at limited or reasonable assurance. A "GHG Protocol certificate" is a product of whoever sells it, not of the GHG Protocol.
Is a GHG Protocol inventory mandatory?
Not in itself: the GHG Protocol is voluntary. It becomes a requirement through the rules and programmes that adopt it: IFRS S2, the SBTi's net-zero standard, and customers and CDP asking for figures in its terms.
What are the 15 scope 3 categories?
Upstream: purchased goods and services; capital goods; fuel- and energy-related activities not included in scope 1 or scope 2; upstream transportation and distribution; waste generated in operations; business travel; employee commuting; 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; investments.
Do we have to report scope 3?
Under the Corporate Standard, scopes 1 and 2 are the minimum and scope 3 is optional. If you report under the Scope 3 Standard, all scope 3 emissions must be accounted for, with any exclusion disclosed and justified. Disclosure rules and schemes add their own expectations: IFRS S2 asks for scope 3 emissions, and the SBTi sets coverage rules for targets.
What is the difference between location-based and market-based scope 2?
The location-based method applies average emission factors for the grids where you consume energy. The market-based method reflects the contractual instruments you hold, such as supplier-specific rates and certificates, provided they meet the Scope 2 Quality Criteria. Companies with operations in markets that offer such instruments report both figures, each labelled by method.
Keep exploring
Related to this video
The complete guide
Everything on GHG Protocol
Start with the GHG Protocol page, or go straight to the guide you need.
On the GHG Protocol page
- What are the main GHG Protocol requirements?
- How do you build and verify a GHG Protocol inventory?
- How much does a GHG Protocol inventory cost?
- How long does a GHG Protocol inventory take?
- Who needs a GHG Protocol inventory?
- How a GHG Protocol inventory pays its way
- Frequently asked questions about the GHG Protocol
Often combined with GHG Protocol
More videos: Environment, energy and climate
- How to implement ISO 14064-1Implementation walkthrough · 3 min 15 s
- ISO 14064-1 requirements explainedTwo-minute brief · 2 min
- How to implement ISO 14068 (formerly ISO 14068-1) carbon neutralityImplementation walkthrough · 3 min 15 s
- ISO 14068 (formerly ISO 14068-1) requirements explainedTwo-minute brief · 2 min
- How to implement ISO 20121Implementation walkthrough · 3 min 15 s
- ISO 20121 requirements explainedTwo-minute brief · 2 min
- How to set science-based targets with the SBTiImplementation walkthrough · 3 min 15 s
- SBTi target criteria explainedTwo-minute brief · 2 min
- How to implement ISO 14001Implementation walkthrough · 3 min 24 s
Talk to a consultant
Plan your GHG Protocol inventory with confidence.
Tell us your goals, locations and target date. We’ll help you define the scope, timeline and next steps.
hello@sterling-grc.com+1 201 263 4443 (global headquarters) · your nearest office and its number are at the top of this page
What would you like to achieve?
Choose a starting point. The enquiry form takes about a minute.
Book my free discovery callContinue to the enquiry form to share your details. Please do not include passwords, sensitive personal information or confidential files. A Sterling consultant replies within one working day. Privacy notice