More and more, organizations are turning a keener eye toward ESG initiatives. Though the Social Governance pillars are no less important, it’s the Environmental cornerstone of ESG that is commanding more scrutiny—more specifically, greenhouse gas (GHG) emissions.
With the escalation of climate and various environmental, social, and governance (ESG)-related risks, organizations are now actively setting bold sustainability objectives, and in recognition of the related concerns in their supply chains over which they lack control, companies are also asking for cooperation from their vendors in addressing their emissions to further minimize their environmental impact.
Unlike Scope 1 and Scope 2 emissions—which are the direct and purchased energy emissions of a corporation, respectively—Scope 3 emissions are indirect emissions generated from activities of assets not owned or controlled by the reporting organization.
A new landmark in corporate climate change legislation, California Senate Bill (SB) 253, the Climate Corporate Accountability Act, has just been passed in the California Senate, and—now that it's been signed into law by the governor—it will mandate that the applicable companies report their direct greenhouse gas emissions as well as those generated by their utilities.