The GHG Protocol defines 15 categories of Scope 3. You don't need to report on all of them — only the ones that are material to your business. For most mid-market companies, 3–5 categories account for 80%+ of Scope 3.
| # | Category | Direction | Typically Material For |
|---|---|---|---|
| 1 | Purchased goods & services | Upstream | All companies (usually the largest category) |
| 2 | Capital goods | Upstream | Manufacturing, heavy industry |
| 3 | Fuel & energy activities | Upstream | All companies (often small) |
| 4 | Upstream transportation | Upstream | Retail, manufacturing, distribution |
| 5 | Waste generated in operations | Upstream | Manufacturing, food & beverage |
| 6 | Business travel | Upstream | Professional services, consulting |
| 7 | Employee commuting | Upstream | Large office-based companies |
| 8 | Upstream leased assets | Upstream | Companies leasing significant assets |
| 9 | Downstream transportation | Downstream | Product companies, retail |
| 10 | Processing of sold products | Downstream | Intermediate goods manufacturers |
| 11 | Use of sold products | Downstream | Energy-consuming products (vehicles, appliances) |
| 12 | End-of-life of sold products | Downstream | Product companies |
| 13 | Downstream leased assets | Downstream | Real estate, leasing companies |
| 14 | Franchises | Downstream | Franchise businesses |
| 15 | Investments | Downstream | Financial services (often the largest) |
Don't try to calculate all 15 at once. Start with a screening to identify which categories are material.
For most mid-market companies (non-financial), the top 3 categories are:
Category 1 (Purchased goods & services) — typically 40–70% of total Scope 3. Category 4 (Upstream transportation) — typically 5–15%. Category 11 (Use of sold products) — varies widely by product type.
Start with Category 1. It's the biggest, it uses the simplest method (spend-based), and it gives you an actionable number you can improve over time.
The fastest way to get a Scope 3 number. You already have the data — it's in your accounting system.
EEIO stands for Environmentally-Extended Input-Output. These are emission factors that map dollars spent in an industry sector to estimated emissions. The US EPA publishes EEIO factors through the USEEIO model.
Your company spent $2M on raw steel, $800K on packaging, and $500K on logistics last year.
Raw steel: $2,000,000 x 0.82 kgCO2e/$ = 1,640,000 kgCO2e = 1,640 tCO2e
Packaging: $800,000 x 0.45 kgCO2e/$ = 360,000 kgCO2e = 360 tCO2e
Logistics: $500,000 x 0.65 kgCO2e/$ = 325,000 kgCO2e = 325 tCO2e
Total Scope 3 estimate: 2,325 tCO2e
US EPA USEEIO model: epa.gov/land-research/us-environmentally-extended-input-output-useeio-technical-content. UK: DEFRA publishes Scope 3 factors by SIC code. GHG Protocol also provides a Scope 3 Evaluator tool with built-in EEIO factors.
The most accurate method. You ask your suppliers for their emissions data directly.
The allocation factor reflects how much of the supplier's total output goes to you. Simplest approach: your spend with that supplier / their total revenue.
Your steel supplier reports total Scope 1+2 of 50,000 tCO2e and $100M in revenue. You spent $2M with them.
Allocation: $2M / $100M = 2%
Your share: 50,000 tCO2e x 2% = 1,000 tCO2e
Compare: spend-based gave 1,640 tCO2e. Supplier-specific gave 1,000 tCO2e. A 39% difference — that's real.
1. Check if they report to CDP (free to search: cdp.net/en/responses). 2. Ask directly — send a simple questionnaire requesting Scope 1+2 totals, methodology, and reporting year. 3. Use industry averages for suppliers who can't or won't provide data. 4. Consider a supplier portal where vendors submit data directly into your system.
The practical path most companies follow:
Start with spend-based for all suppliers. Then upgrade your top 10–20 suppliers (by spend) to supplier-specific data. These top suppliers typically represent 60–80% of your Scope 3. The rest stays spend-based.
Each year, expand the supplier-specific coverage. Year 1: top 10. Year 2: top 25. Year 3: top 50. Your Scope 3 accuracy improves steadily, which is exactly what the GHG Protocol expects.
Rate each supplier's data on a 1–5 scale. This helps you prioritize where to improve and demonstrates methodological rigor to auditors.
| Score | Description | Method |
|---|---|---|
| 5 | Verified primary data | Supplier-specific, third-party verified |
| 4 | Unverified primary data | Supplier-specific, self-reported |
| 3 | Industry-specific secondary data | Industry average EF for specific product |
| 2 | Generic secondary data | EEIO spend-based, rough estimate |
| 1 | Highly uncertain | Extrapolated, no real data |
Your electricity emissions are Scope 2. Your supplier's electricity emissions (which you see in their Scope 2 data) are your Scope 3. Don't add your Scope 2 into your Scope 3 — they're separate categories by definition.
EEIO factors are sensitive to sector classification. "Steel manufacturing" and "metal fabrication" have different factors. Map your suppliers to the most specific sector code available.
EEIO factors are typically based on a specific base year (e.g., 2012 for USEEIO). If your spend data is in 2025 dollars, you need to deflate to the base year before applying the factor. Most Scope 3 tools handle this automatically.
When using supplier-specific data, you must allocate their total emissions to your share of their output. Revenue-based allocation (your spend / their total revenue) is the simplest and most accepted method.
Emberglow's supplier portal lets your vendors submit emissions data directly. Auto-calculates quality scores and flags gaps.
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