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Work & Wellbeing Agency Models Climate Crisis

A marketer’s guide to global emissions: what GHG and Scope 1, 2 and 3 mean

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By Ellen Ormesher, Senior Reporter

November 17, 2022 | 9 min read

The Drum breaks down Greenhouse Gas Protocol, the meaning of Scope 1, 2 and 3 emissions, and how they pertain to the advertising and marketing industry.

Carbon

Measuring and minimizing emissions has never been more urgent / Image via Adobe Stock

Following a dip during the Covid-19 pandemic, fossil fuel emissions are set to reach record highs in 2022, and every industry is becoming increasingly aware of the need for it to accurately track and report its carbon emissions if we are to effectively tackle the ongoing climate emergency.

But understanding your corporate carbon footprint, and the different types of emissions classified as Scopes 1, 2 and 3, can be a challenging process.

Here, The Drum breaks down the terminology to help marketers get a clear view of where they need to focus.

What’s Greenhouse Gas (GHG) Protocol got to do with it?

The 2007 Paris Agreement on climate change dictated that limiting the global temperature increase to 1.5C above pre-industrial levels by 2050 was a global responsibility. But that target is looking increasingly out of reach.

At this year’s Cop27 summit, UN general secretary Antonio Gutteres warned “we are on a highway to climate hell with our foot on the accelerator” and urged world leaders to “cooperate or perish.”

From there came the message to business leaders that measuring corporate emissions is no longer a supplement to businesses’ sustainability plans – it’s an urgent necessity.

That’s where the GHG Protocol comes in. It’s a global, standardized framework used to measure and manage greenhouse gas emissions from the operations, value chains and actions of a company.

Developed by the World Resources Institute and the World Business Council for Sustainable Development, the GHG Protocol accounting standards, tools and training help businesses measure and manage climate-warming emissions. It provides guidelines and requirements for companies to enable them to measure their greenhouse gas emissions using their Corporate Carbon Footprint.

The GHG Protocol Corporate Standard then categorizes greenhouse gas emissions associated with a company’s Corporate Carbon Footprint (CCF) as Scope 1, Scope 2 and Scope 3 emissions.

We break those down here and highlight where they are most relevant when it comes to marketing activities.

Scope 1 – Direct Emissions

These are the emissions created through a company’s owned or controlled sources – in other words, the emissions created in the day-to-day running of a company.

In adland, these emissions are relatively low as we mainly produce ideas – compared to, say, a high-carbon industry such as aviation or automotive.

The average annual operational carbon footprint of someone in a UK advertising agency is 3.4 tonnes CO2e. That is comparable to other professional service sectors such as accountancy and law, which have similar offices and travel habits.

Action one in Ad Net Zero’s five-point plan to tackle adland’s direct emissions highlights the two key emissions sources within the industry. Those are travel (especially flying), which is typically around 60% of an agency’s emissions, and office energy use, typically 40% of emissions.

Agencies should adopt a science-based target to determine a program for reduction that will achieve net zero by end-2030, in line with the Ad Net Zero industry goal.

Scope 2 – Indirect Emissions

This is where it gets a little more complicated. Scope 2, or indirect emissions, are classified as purchased or acquired energy, or energy that is generated offsite.

In advertising, this occurs in two key areas – ad production and in media buying and planning.

The emissions created in actually developing a creative campaign can be high, particularly when it comes to location shoots with high levels of travel, hospitality and complex supply chains.

As a result, they can also be hard to measure. But the AdGreen calculator – which launched in September 2020 to help measure advertising production carbon footprints, thus allowing project teams to understand which activities have the biggest impact – is a good place to start.

Media planning and buying is the biggest hidden carbon creator in the advertising supply chain. Last year, WPP found that 55% of its carbon emissions came from the media it was distributing ads on, be it social networks, connected TV (CTV), billboards or the longtail of the web.

However, the first wave of media carbon calculators was “imperfect,” and panelists at the recent Ad Net Zero summit are now calling for an industry best standard practice to be set in order to accurately measure and subsequently reduce media’s impact.

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Scope 3 – Value Chain Emissions

This is the biggie. And hardest to quantify. Scope 3 includes all indirect emissions that occur in the value chain of a company.

The US Environmental Protection Agency (EPA) describes Scope 3 emissions as “the result of activities from assets not owned or controlled by the reporting organization, but that the organization indirectly impacts in its value chain.”

In essence, it’s everything advertising stands for. The ability to promote other industries, change behaviors and lifestyles and, indeed, drive consumption.

‘Advertised Emissions,’ a term coined by industry activist group Purpose Disruptors, are defined as the uplift in greenhouse gas (GHG) emissions that result from the increase in sales generated by advertising.

In its recent report, Purpose Disruptors measured that through this uplift, advertising as an industry adds an extra 32% to the annual carbon footprint of every person in the UK.

So even though these emissions are out of the immediate control of agencies, they arguably represent the largest portion of their greenhouse gas emissions inventory.

Ad Net Zero’s action five is dedicated to urging agencies to “work together to use advertising to promote more sustainable choices between competing products and services, to back innovations that deliver greener solutions to people’s needs and desires, and to persuade society to adopt behaviors that reduce carbon emissions.”

Driving these changes require increasingly strict regulations around the green claims made by advertisers. In the UK, CAP codes and ASA regulations highlight the need for clarity, substantiation and evidence for environmental claims. And the ASA has recently committed to a broader review of its responsibilities around climate change and human impact on the environment.

Dentsu’s chief sustainability officer Anna Lungley recently called on the industry to adopt science-based targets, including the GHG protocol, in order to understand its true environmental impact and incite meaningful change.

The GHG Protocol requires that companies account for and report all Scope 1 and Scope 2 emissions. Even though Scope 3 emissions accounting is optional, it is likely unavoidable for a genuine climate action strategy to be effective.

Work & Wellbeing Agency Models Climate Crisis

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