Carbon Accounting for businesses – what you need to know


Carbon Accounting is the process of calculating the direct and indirect carbon emissions generated by an organisation’s operations within a defined boundary, also referred to as your carbon footprint. It is an important tool in the journey towards Net Zero carbon emissions.

Net Zero refers to achieving a balance between the amount of greenhouse gas emissions produced and the amount removed from the atmosphere, resulting in no net increase in atmospheric carbon dioxide levels. The focus is to reduce carbon emissions, and as a last resort consider offsetting though this is becoming an increasingly contentious approach to take.

Understanding Carbon Boundaries

In order to calculate your baseline carbon footprint, you first need to define your carbon boundaries – i.e., what is and is not to be included in your calculation. Generally, your boundaries depend on how much influence you have over the emissions, as well as what you are using the calculation for – there may be compliance requirements that you need to consider when deciding on your carbon boundaries.

There are three scopes of carbon emissions:

  • Scope 1: This includes emissions directly produced by your activities such as burning fuel.
  • Scope 2: This includes indirect emissions resulting from the purchase of energy.
  • Scope 3: This includes external or value chain emissions e.g. emissions from the production of the goods and services you purchase. 
Infographic showing the difference between carbon emission scopes using in carbon accounting. Scope 1 - Direct Emissions; Scope 2 - Indirect Emissions; Scope 3 - External Emissions. See text description below image for more detail.

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Infographic showing the difference between scopes. Scope 1 – Direct Emissions shows a heating unit inside a factory building. Scope 2 – Indirect Emissions shows external energy production linked to the factory. Scope 3 – External Emissions shows arrows for inputs (upstream emissions) and outputs (downstream emissions) leading to and from the factory.

Building your carbon footprint

Once you have defined your carbon boundaries you can begin to calculate your baseline carbon emissions. This will include looking at your current operations and expenditures to create an overview of your emissions in different areas of your business, for example energy use on site, transport, or purchases of goods. The GHG Protocol has a defined list of 18 emission categories and accepted accounting methodologies.

Carbon Accounting Considerations 

Carbon accounting at its core is quite straightforward; find the raw data that best measures an activity, such as kWH for energy, then multiply by the relevant carbon factor to calculate the emissions. Despite the simple maths, there are a number of considerations to be mindful of.   

Tip 1 – Identify Relevant Data Sources  

Understanding data sources and the process of data gathering is a key aspect of carbon accounting. Accurate and reliable data is essential for calculating carbon emissions and establishing a solid foundation for effective emission reduction strategies. Sources of data may include utility bills, fuel consumption records, transportation logs or 3rd party data from your suppliers. Some suppliers may even calculate carbon emissions related to their activity such as a travel management company. It’s important to take time to understand what data is available, where there are gaps, and where to prioritise your efforts. 

Tip 2 – Balancing accuracy, reliability and effort

It is important to balance the accuracy and reliability of carbon data with the effort required to collect it. It is essential to strive for accuracy to ensure the calculated emissions are as close to the actual values as possible. Additionally the sources from which data is collected should be reputable and trustworthy, ensuring that the information used for carbon accounting is credible and can withstand scrutiny. However, it’s also important to strike a balance and consider the effort required to collect data. Collecting data can be a resource-intensive task, requiring time and financial resources. Finding the right balance ensures that data collection efforts are manageable, feasible, and cost-effective while still providing a high level of accuracy and reliability.

Tip 3 – Credible Carbon Factors  

It is important to use carbon factors from a credible source. The Department for Energy Security and Net Zero (previously Department for Business, Energy & Industrial Strategy) issues a comprehensive collection of updated carbon emission factors on an annual basis. Some carbon reporting software and reporting platforms include emissions factors from multiple verified sources. Beyond Green works closely with Ecometrica which has a global database of emission factors.

Tip 4 – Account for Inflation

During 2022, inflation was around 10%, which will have fed into prices of goods and services purchased by an organisation. A pragmatic, reliable and accepted carbon accounting method, which is suitable for many organisations, is to use a carbon factor (£/kgCO2e) to convert the amounts spent on goods and services into a proxy for the carbon emissions emitted during the manufacture of goods. 

However, the revision of these spend based factors lag behind actual price increases and thus could artificially increase an organisation’s emissions if not corrected. This is because amounts spent is a proxy and does not relate to the actual emissions generated from the use of primary energy (scope 1 and 2) in the manufacture, which may have actually reduced per unit produced. It is therefore important to continually improve your carbon accounting methods to obtain credible carbon factors from suppliers relating to their primary energy use.   

Tip 5 – Repeatable Methodology

Having a repeatable methodology for carbon accounting ensures consistency in the calculations and reporting of carbon emissions over time, allowing you to evaluate the effectiveness of carbon emission reduction efforts. A consistent approach to carbon accounting enhances transparency and credibility, enabling stakeholders to have confidence in the reported emissions data. This is particularly crucial for organisations seeking to demonstrate their commitment to sustainability, comply with regulatory requirements, or engage in voluntary reporting initiatives. Ultimately, a repeatable methodology provides a solid framework for consistent and reliable carbon accounting, supporting organisations in making informed decisions, setting targets, and driving effective climate action.

How we can support you

We have an extensive track record of calculating carbon footprints, both independently and as part of larger sustainability or Net Zero projects. We’ll be able to advise you on defining your carbon boundaries. Our expertise in carbon accounting  and experience building reliable and robust methodologies will support you in maintaining an overview of your carbon impacts in the long term.

Testimonials & Case Studies

The Institute of Chartered Accountants of Scotland (ICAS)

“Beyond Green has been fantastic in guiding us through our journey towards Net Zero, from the early Briefing and Scoping Sessions, through our Data Collection Sessions to establish our Carbon Inventory, to quantifying our Carbon Baseline. They provided the right mixture of guidance and technical expertise, where those were required and steered us through the process of developing our Net Zero Roadmap. Paul Adderley and Neil Hutson have been such a great help and support throughout this project and we will be seeking their continuing support as we move forward on our journey towards Net Zero.” – Craig Anderson, ICAS Facilities Manager, November 2022

> Read more about this project here: ICAS Net Zero Strategy Case Study 


Inspiring Scotland

“Beyond Green provided excellent support and coaching as we navigated our way through our first carbon audit.  They provided expert knowledge and project management but also ensured the process engaged the whole organisation, reflected our values and ambition and left us with the ability to continue this important work ourselves. I would thoroughly recommend them for any small organisation looking to begin the journey to Net Zero.”

Erica Judge – Director of Funds, Climate Justice, Inspiring Scotland, May 2023


Royal College of Radiologists (RCR)

“It’s a pleasure to recommend Beyond Green as a partner in starting and supporting a journey to delivering our environmental goals. We have worked with Beyond Green since March 2022 to assist the Royal College of Radiologists on our journey to understanding our impact on the environment and work towards our Net Zero targets.

During this time, Beyond Green expertise has helped to revise our carbon baseline beyond scope 1 & 2 into scope 3 emissions and provide guidance and insight on our internal carbon emissions data. Paul, Neil and the Beyond Green team have been professional, have adapted to our ways of working during the project and demonstrated a collaborative working style that has been essential to keep us involved throughout the process and help transfer knowledge into our team. We could not have done this ourselves and I’m grateful for their work.

We will continue to work with Beyond Green to support us with identifying carbon reduction opportunities and creating a Net Zero pathway. We will also be working with Beyond Green to implement the Ecometrica carbon accounting  platform into our organisation to streamline our carbon reporting process.”

David Botha, Executive Director, Business and Resources, RCR November 2022