Effective 2024, the EU’s Corporate Sustainability Reporting Directive (CSRD) requires shippers to provide detailed sustainability reports, including indirect supply chain emissions produced by third-party logistics partners.
With the CSRD, regulatory requirements and increasing consumer demand on the impact of businesses on the environment, converge to push shippers to seek emissions measurements from freight forwarders.
For freight forwarders, investing in a reliable CO2 emissions calculator becomes essential for providing accurate and accredited measurements to their clients.
To effectively manage and report on sustainability progress, the entire value chain – shippers, forwarders, investors and regulators – along with consumers, are increasingly asking for reliable and trustworthy emissions calculations.
In June 2023, the Council and European Parliament reached a provisional political agreement on the Corporate Sustainability Reporting Directive (CSRD), which expands on previous regulations demanding greater transparency and accountability in reporting sustainability information.
According to the CSRD, companies are mandated to annually disclose detailed information about environmental impact, social responsibility, and governance practices. This encompasses evaluating and reporting on how their operations and supply chains align with broader sustainability goals.
The CSRD in a nutshell
The CSRD applies to large companies – entities with more than 250 employees, and a net turnover exceeding €40 million – including those listed on EU stock exchanges, as well as non-EU companies with substantial EU operations.
In a nutshell, companies within the CSRD scope will need to start recording their Scope 1, Scope 2 and Scope 3 greenhouse gas (GHG) emissions in compliance with the European Sustainability Reporting Standards (ESRS) and begin reporting them in 2025.
With the CSRD, the EU has taken the lead worldwide in implementing emissions reporting regulations, mandating that shippers disclose their Scope 3 emissions starting in 2024. The UK, US, Australia and Brazil are expected to follow suit with similar regulations, potentially making 2024 a pivotal year for global emissions reporting standards.
Measuring and reporting supply chain-related emissions
Measuring and reporting all Scope 3 emissions is especially complex for the shipper, as it results from indirect activities from assets not owned or controlled by the organization. These include transportation and distribution, which are among the most difficult-to-measure, yet highly emitting, categories, of Scope 3.
Shippers will need to rely on their suppliers, such as freight forwarders and logistics providers, to get data about their Scope 3 supply chain emissions. So, it is time for freight forwarders to acknowledge that the shipment data they hold for their clients is a valuable resource and the key to getting accurate and accredited supply chain emissions measurements.
CarbonCare: a reliable calculator for Scope 3 emissions
Freight forwarders can proactively prepare to provide precise and consistent measurements by investing in an effective tool for emissions calculations like the CO2 calculator marketed by Cargo Start on behalf of the Swiss company CarbonCare, specially developed to support logistics & transportation players in managing their efforts to reduce climate impact and to integrate a carbon intelligence in their business.
Recently validated by the leading certification company SGS, CarbonCare’s calculation method is based on the ISO 14083:23 standard – built on the principles of the GLEC framework 2.0 – and delivers precise and consistent emissions measurements for all modes of transport – including handling operations and cold storage – at single shipment level. Moreover, the CarbonCare measurements, are valid as “compensation credits” that can be invested in the climate protection projects promoted by the foundation myClimate.
The CarbonCare calculator is not only a valuable tool to support freight forwarders in making more climate-friendly and informed decisions but also to help them proactively collect shipment data and deliver audit-ready emissions measurements and reports to the shippers, enabling them to meet their regulatory requirements.
More information about CarbonCare