belgiumfr
Sustainable Investing Glossary

Greenhouse gas emissions | GHG emissions

Greenhouse gas emissions are the levels of carbon dioxide, carbon monoxide, sulfur dioxide and other gaseous byproducts of the industrial processes of a company in its business operations.

They are cited as being the principle cause of global warming, since they become trapped in the Earth’s atmosphere, creating a blanketing effect.

The need to decarbonize companies – and thereby portfolios – becomes more urgent as evidence of global warming mounts with every passing year. In order to combat it, it is important to be able to measure it. The Greenhouse Gas Protocol was set up to establish comprehensive global standardized frameworks to measure and manage emissions from private and public sector operations, value chains and mitigation actions. It is based on a 20-year partnership between the World Resources Institute and the World Business Council for Sustainable Development. Its calculation tools are used by companies, municipalities and governments to measure greenhouse gas emissions and carbon footprints.

Some carbon footprints are more obvious than others; power generators that burn coal to make electricity obviously emit more CO2 in the resulting emissions than a bank on the high street. The bank’s footprint would essentially be any emission produced as a result of heating, cooling and ventilating the building. But they can be deceptive – many people think going online to send an email or download a movie is non-polluting. Yet, the infrastructure surrounding the internet, including the energy-intensive data centers needed to make it all work, has a carbon footprint that is almost as high as the airline industry. 

Greenhouse  gas emissions that cause the footprints are measured in three ways: Scope 1, 2 and 3. Scope 1 emissions are those that are directly generated by the company, such as an airline emitting exhaust fumes. Scope 2 emissions are those that are created by the generation of the electricity or heat needed by the company to sell its main products. An electricity utility would therefore have relatively low Scope 1 emissions caused by its infrastructure or grid, but high Scope 2 emissions if it’s power came from the burning of fossil fuels rather than from renewable sources. Scope 3 emissions are those caused by the entire value chain, including the end-user of the product over its life cycle, and are much more difficult to measure. A carmaker would have relatively low Scope 1 and 2 emissions for making the car, but the user of the vehicle would burn petrol to run the car over many years, causing very high Scope 3 emissions.

Faire des choix d’investissement avisés
Faire des choix d’investissement avisés
Investissement durable
Scopes 1-3 emissions of the five IPCC sections over the period 1995-2015, calculated using EXIOBASE 3
Source: IOPscience

One solution to lowering carbon footprints is seen as the introduction of a carbon tax that makes companies pay for emissions above a certain threshold. They would therefore have a choice of a large increase in costs, harming their profitability and long-term viability, or cutting carbon to avoid the tax.

See also: decarbonization, Paris Agreement, global warming

Investir dans l’économie circulaire
Investir dans l’économie circulaire
Aiguisé par les schémas de production et de consommation linéaires, notre insatiable appétit de ressources dépasse les capacités de régénération de la planète.
16-10-2020 | Vision
Le grand livre de l’investissement thématique
Le grand livre de l’investissement thématique
Ces dernières années, les stratégies d’investissement thématique ont acquis une certaine popularité, en grande partie grâce à un argumentaire efficace et – dans certains cas – aux bons résultats d’investissement à court terme.
13-10-2020 | Recherche
Building more resilient garment supply chains
Building more resilient garment supply chains
Garment industry supply chains have been rocked by Covid-19, but corporate commitments to pay living wages remain on top of the agenda.
09-10-2020 | Vision
Logo

Décharge légale Agree

Les informations présentes sur ce site Web sont destinées exclusivement aux professionnels. Un investisseur professionnel est : un investisseur qui, à titre professionnel, dispose d'assez de connaissances et d'une expertise et d'une expérience suffisantes pour pouvoir évaluer de manière adéquate les risques financiers liés aux décisions d'investissement prises par lui-même.

Les visiteurs de ce site Web doivent être conscients du fait qu’ils sont eux-mêmes tenus de respecter toutes les lois et règlements en vigueur dans leur pays.

En cliquant sur J'accepte, vous confirmez que vous êtes un investisseur professionnel. Si vous cliquez sur Je n'accepte pas, vous êtes orienté vers la partie réservée aux particuliers.

Je n’accepte pas