Scope 3 Reporting for SMEs

Scope 3 reporting for an SME means measuring emissions from your supply chain, business travel and purchased goods — categories you don't own directly, but that the GHG Protocol still requires you to estimate. Most SMEs only need to report 3–5 of the 15 possible categories in practice.

Unlike Scope 1 and 2, there's no meter reading for Scope 3 — it's built from a mix of supplier data, spend-based estimates, and activity records you likely already hold in your accounting system. The GHG Protocol defines 15 possible categories, but for most SMEs, three to five will account for the overwhelming majority of the footprint: purchased goods and services, business travel, employee commuting, and (if relevant) upstream transportation.

How to scope your first Scope 3 inventory

1. Identify your material categories. Start with spend data — the categories where you spend the most are usually where the emissions are too.
2. Choose spend-based or activity-based estimation. Spend-based is faster to start; activity-based (actual supplier data) gets more accurate over time.
3. Request supplier data where it matters most. You don't need this from every vendor — just your top emissions categories by spend.
4. Set a baseline year and lock your boundaries. Consistency year over year matters more than precision in year one.