Before they introduce credible targets to reduce greenhouse gas emissions, companies must first measure them. The Greenhouse Gas Protocol, a global accounting standard for carbon emissions, defines three types. Scope 1 emissions are from a company’s owned operations; scope 2 from its energy inputs; and scope 3 from its supply chain and the consumption of its products.
SCOPE 3 EMISSIONS
Many oil and gas companies have set targets for scope 1 and 2 emissions. So far, much of the industry has resisted scope 3 targets, which account for 85%-95% of the total. That is not surprising: Setting targets for reducing the consumption of a company’s core product is akin to adopting a strategy for either going out of business or bridging to a new one.
Several of last year’s resolutions attracted strong support: 58% of ConocoPhillips’ shareholders voted in favor of more comprehensive targets in 2021, for example. This year, support among ConocoPhillips’ shareholders declined to 39%. According to Sustainalytics, support for resolutions focused on climate targets declined to 41% in 2022, from 46% in 2021 and 52% in 2020.