How to Measure Your Business’s Carbon Footprint (and Why It Matters)
3 min
30th May 2025
Sustainability has become a growing priority for businesses of all sizes. Whether driven by regulatory requirements, customer expectations, or internal values, it’s increasingly important for organisations to understand and reduce their environmental impact. But before making any meaningful progress, you need a clear picture of where you currently stand.
Measuring your carbon emissions is the first step. It helps track improvements over time, ensures compliance, and demonstrates a genuine commitment to sustainability.
So, what exactly is a carbon footprint, why is it important, and how do you measure it effectively?
What is a Carbon Footprint?
A carbon footprint is the total amount of greenhouse gases (GHGs) produced by your organisation’s activities, expressed in carbon dioxide equivalent (CO₂e). These emissions typically come from areas such as energy use, transport, manufacturing processes, and waste.
Understanding your carbon footprint allows you to assess the environmental impact of your operations and take targeted action to reduce it. With climate-related regulations tightening and consumer awareness on the rise, businesses are expected to play their part. Measuring emissions can also uncover inefficiencies, leading to cost savings in the long term.
Step 1: Understand Emissions Scopes
To start, it’s useful to break emissions down into three categories, known as scopes:
- Scope 1 – Direct emissions from owned or controlled sources. This might include company vehicles, on-site fuel combustion, or factory operations.
- Scope 2 – Indirect emissions from purchased energy, such as electricity, heating, or cooling.
- Scope 3 – All other indirect emissions that occur across your value chain. This includes business travel, procurement, employee commuting, and waste management.
Scope 3 is often the most difficult to measure but can account for the majority of a business’s overall emissions.
Step 2: Gather Relevant Data
Accurate data is essential. The more comprehensive your records, the more reliable your carbon assessment will be.
Key areas to focus on include:
- Energy consumption: Track electricity, gas, and other fuels used across your sites.
- Transport and travel: Record staff business travel and company vehicle mileage.
- Waste: Consider how much waste is produced and how it is managed (recycled, landfilled, etc.).
- Supply chain: Look into the environmental impact of your suppliers and outsourced services.
Gathering this data might take time, especially if you haven’t done it before, but it forms the backbone of your emissions profile.
Step 3: Choose Tools and Methodologies
There are several ways to calculate your carbon footprint, depending on the size and complexity of your business:
- Carbon calculators: Tools from organisations like the Carbon Trust or GHG Protocol can help small and medium-sized businesses estimate their emissions.
- Lifecycle Assessment (LCA): A detailed approach that assesses emissions at every stage of a product or service’s life cycle.
- Carbon management software: There are several platforms suited to larger organisations and offer in-depth analysis and tracking features.
The method you choose should align with your organisation’s goals and available resources.
Step 4: Analyse and Identify Key Emission Sources
Once you’ve completed your assessment, review the findings to pinpoint the main sources of emissions. These are often referred to as ‘hot spots’.
For example, electricity use may be higher than expected, or emissions from logistics and supply chain operations could make up the bulk of your footprint. Identifying these areas helps inform your strategy for reducing emissions.
Step 5: Set Targets and Take Action
With a clearer understanding of your emissions, you can now set realistic and measurable targets. Focus initially on areas where you have the most control – typically Scope 1 and Scope 2 emissions – before working towards reducing Scope 3 over time.
Practical measures might include:
- Improving energy efficiency (e.g. LED lighting, better insulation, energy management systems)
- Switching to renewable energy suppliers
- Encouraging low-carbon commuting options for employees
- Reducing waste through better recycling and composting schemes
Setting out a clear emissions reduction plan not only helps the planet – it can enhance your reputation and bring financial benefits too.
