FMJ Facilities Management magazine providing industry-specific intelligence to FM and property professionals
PART 2: TACKLING DATA CHALLENGES IN SCOPE 3 EMISSIONS
The need for high quality data
High-quality, comparable, and reliable data is the foundation of an effective Scope 3 emissions strategy. For FM providers, where indirect emissions account for a large portion of their carbon footprint, accurate data is essential to understand the company’s full environmental impact.
Reliable data allows companies to set accurate baselines, track progress, and identify key opportunities. High-quality data supports better decision-making, enabling organisations to develop robust sustainability strategies and communicate credible emission reductions to clients. Transparency is a key tenet of disclosure and allows a company to demonstrate its commitment to decarbonisation. Comparability, meanwhile, allows organisations to benchmark themselves against the industry, as well as track progress towards their sustainability goals.
Navigating data gaps and inconsistencies in complex supply chains
However, achieving this standard of data has proven difficult for FM providers. Obtaining accurate and sufficiently granular Scope 3 emissions data from suppliers is both costly and time-consuming. FM providers frequently lack the knowledge and training to understand what information to request, and what format it needs to be in. A comprehensive understanding of Scope 3 emissions is essential to requesting the correct data from suppliers. Certain services provided will have more of an environmental impact, but without an understanding of what these are, FM providers may not be getting an accurate picture of their overall emissions.
Suppliers often lack the resources, tools, or expertise to provide reliable data. Particularly, smaller suppliers may lack the tools, resources, and training to respond effectively to emissions data requests. This issue is further complicated by the diverse and complex nature of supply chains in the FM sector. Suppliers can span across countries and industries, with varying approaches to data collection and reporting.
In many cases, FM providers rely on spend-based estimations to calculate emissions. While permissible under the GHG Protocol, this approach lacks precision and limits the company’s ability to identify emissions reduction opportunities. Spend-based methods use financial data to estimate emissions based on industry averages but fail to capture the unique characteristics of individual suppliers or activities. Using spend-based data can mean that the only way for a company to reduce their emissions is to reduce their spend. This limitation makes it difficult to identify reduction opportunities or report transparently.
Activity-based data is far more reliable but harder to obtain. To achieve this level of granularity, FM providers must work closely with their suppliers to understand operational details and establish streamlined data-sharing processes. Gathering this type of data allows for an FM provider to find inefficiencies and areas for improvement, and they can work collaboratively with suppliers to reduce emissions.
Increasing regulatory and client pressure
Another challenge in data collection is the lack of consistency in reporting standards among suppliers. Larger suppliers may follow specific frameworks to record their data, while smaller suppliers may not adhere to any standards. This can make it difficult for FM companies to aggregate, compare, and verify data across their supply chain. Variations in reporting standards, differing levels of granularity, and lack of verification adds to the problem. This can not only prevent accurate reporting but also hinders FM companies’ ability to meaningfully engage with their suppliers on sustainability topics.
As discussed in Part 1, the demand for high-quality data will only continue to grow. Regulatory requirements like the CSRD in the EU and frameworks like ISSB and the Science-Based Targets Initiative (SBTi) are driving the push for more accurate Scope 3 emissions reporting, increasing the pressure on FM companies to improve their data collection processes. For FM providers to remain competitive, they must align their practices with these frameworks while meeting client expectations for transparent and accurate reporting.
