How to Calculate Your Business’s Carbon Footprint

11 minutes

Whether you know it or not, your business has an impact on the environment. And it’s not a small one – many companies contribute significantly to climate change, air pollution, and other forms of environmental destruction.

Calculating the “carbon footprint” of your company can help you figure out just how much your business contributes, but if that phrase confuses you don’t worry – we made this guide specifically for beginners!

Join us as we walk through the steps of calculating your carbon footprint in a fun and informative way. If you're ready to learn how to calculate your business' carbon footprint, then this post is for you.

Let's get started!

What is a carbon footprint?

A carbon footprint is a measure of the amount of carbon dioxide, greenhouse gasses, or other carbon compounds, emitted into the atmosphere by activities related to an organization or business. The sources of this emission can be from transportation, fuel use, water usage, electricity use, and waste production.

Carbon footprints are mainly used to assess and compare the environmental impact of an organization’s presence.

By measuring and understanding the elements that make up their carbon footprint, organizations can identify areas in which they could reduce their carbon emissions and further develop sustainable practices.

How can you calculate your carbon footprint?

Why is calculating carbon footprint important for businesses?

Calculating a carbon footprint has become an increasingly important factor for businesses in the last few decades as humans continue to create more and more emissions through their activities.

According to the EPA, it is estimated that human activities are responsible for almost all of the increase in greenhouse gasses seen over the last 150 years. Of these activities, fossil fuel burning for electricity, heat, and transportation have proved to be the largest sources of GHG emissions in the United States alone.

Businesses thus have a critical social responsibility to assess and analyze their carbon footprint in order to help reduce emissions, which are creating dramatic environmental changes due to climate change.

Here are a few more reasons why businesses need to pay attention to their carbon footprint.

Climate change is a global challenge

The responsibility of combating the climate crisis falls on every individual, government, and business. It is only with everyone working together that we can hope to achieve the global goal of limiting average annual global warming to no more than 2°C per year above pre-industrial levels.

Calculating carbon footprint is essential to this endeavor, since it gives organizations an insight into their direct contributions to climate change. Understanding these emissions will allow them to identify ways they can reduce their negative impact, contributing to the worldwide effort of protecting our environment for years to come.

Transparent business is good business

As businesses become increasingly aware of the negative impacts of climate change, transparency in sustainability efforts is more important than ever before. By sharing specific details on existing and ongoing mitigation measures, organizations are able to build trust with their employees and customers.

A recent survey shows that 94% of consumers are likely to favor a brand that is completely transparent about its sustainability efforts. Companies now have the opportunity to not only demonstrate their commitment towards minimizing carbon footprint but actively engage stakeholders in their environmental initiatives.

Brightly Stream™ provides robust solutions that enable companies to monitor and report emissions accurately and in a transparent manner. With this capability, businesses can better track the energy waste and the sources of their carbon emissions, leverage emission transparency in a competitive manner, and engage stakeholders to make informed decisions.

It’s the first step to carbon reduction

Calculating a carbon footprint is an essential step for organizations in their journey towards reducing their impact on the environment.

By understanding how their operations contribute to global carbon emissions, businesses can target areas to reduce or manage these emissions. Once they have identified and quantified the sources of their carbon footprint, whether through direct or indirect emissions, businesses can then set targets and devise strategies in order to reduce the environmental impact of their activities.

For organizations looking to develop an effective carbon reduction strategy, taking stock of their current situation through carrying out a carbon footprint assessment provides an invaluable starting point. From here, there's no limit to what sustainability initiatives your organization could implement.

Want to learn more? Check out our other blog: 10 Simple Ways to Reduce Your Business’s Carbon Footprint.

How to calculate your carbon footprint as a business

As a business, it is important for leaders to understand the carbon footprint of their organization. Taking the necessary steps to measure and control emissions allows businesses to make meaningful contributions to the global fight against climate change.

The process of calculating your carbon footprint as a business involves several steps: first, identify all sources responsible for emitting carbon; second, collect reliable quantitative data on emissions; third, convert the data into an understandable format; and fourth, create a standard process which can be repeated annually.

Staying abreast of these practices not only puts you on the right side of history but also provides an avenue to be more cost effective at managing emissions. Let's take a closer look!

1. Identify the sources of your carbon emissions

Calculating your business's carbon footprint is the first step towards embracing sustainable practices and reaching corporate reductions goals like carbon neutrality or net zero. The key to achieving this is knowing exactly where your emissions are coming from.

Take a moment to consider the various ways your company contributes to greenhouse gas emissions - the majority of which are likely burning of fossil fuels. Think about how and when you transport goods, use electricity in production processes, or drive vehicles- all major sources of co2 emissions.

To get started in calculating your carbon footprint, writing down each activity that involves burning of fossil fuels gives an initial insight into your overall emission counts. This can be done by creating a simple bullet-point list for easy reference.

2. Collect quantitative emissions data

The next key task here is to collect quantitative emissions data, which will then allow you to accurately calculate your overall footprint. This can be done through various methods - looking at utility bills for energy consumption, noting miles traveled for transport emissions, or tracking waste generated for landfill emissions.

Unfortunately, the process of collecting quantitative emissions data can be time-consuming - and as a business owner, time is something of a luxury! That's why it's important to look at other solutions to make manual calculation a bit more automated (and a lot less arduous).

To make the process easier, Brightly Energy Manager™ provides energy consumption monitoring which makes it simpler to record accurate data. ESG data should be regularly updated with clear units of measurement specified (e.g. kWh for energy, Scope 3 emissions,  or metric tons of waste for landfill). Taking these steps will help you to conclude an accurate estimate of your business's carbon footprints from key sources easily, growing more sustainable every day!

3. Convert the data and calculate your footprint

To accurately calculate your carbon footprint as a business, you must first convert the collected data into values that are compatible with an 'emission factor'. The common equation to do this is GHG emissions =data x emissions factor.

To ensure accuracy, it is important to reference the EPA's emission factors for GHG inventories and other reliable sources for emissions factors. You can then add up the totals of each activity measurement (often in metric tons) multiplied by its corresponding emission factor in order to receive your total carbon footprint. Calculating your own carbon footprint by aggregating all this data can be time-consuming, cumbersome, and arduous. The good news is that it doesn't have to be - technology can take care of things for you.

4. Standardize your process

To effectively monitor your business’ yearly emissions, it is useful to standardize your carbon footprint calculation process. That way, the same calculation inputs can be used each year and irregularities are more likely to be identified.

It is also important to take note of activities that weren’t included in the first calculation run. This ensures that any adjustments made do not inadvertently create an inaccurate comparison in the future. It is easy to get bogged down by the details of carbon footprint calculations, but defining a clear-cut process early on will save countless hours in the long run.

How to use your carbon footprint calculation

Calculating your carbon footprint is a critical step towards developing and implementing effective carbon reduction initiatives. ESG reporting software like Brightly Stream can help businesses identify opportunities for emission reduction, set appropriate carbon targets, and disclose emissions data to stakeholders.

This kind of comprehensive analysis gives companies the information they need to strategically reduce their impact and seize upon new opportunities in the marketplace. Let's take a closer look at how you can use your carbon footprint calculation to guide your future business decisions.

Identify opportunities for carbon reduction

By determining the sources of emissions and calculating their output, business owners can more accurately identify opportunities for reducing their company's carbon footprint. Having an understanding of how each area of the business contributes to emissions allows them to develop targeted strategies based on data.

By making informed decisions, businesses are able to focus their efforts on areas that will be the most effective in reducing their emissions. This helps make sure they are getting the maximum impact from the resources they invest in reducing their business' carbon footprint.

Set carbon targets

Calculating a business’ carbon footprint is the first step to understanding their sustainability efforts and defining long-term carbon reduction targets. You can’t create detailed plans for change without understanding the current state of affairs, and regular carbon footprint calculations are crucial in keeping track of progress.

At Brightly, we make it easy to set feasible and effective targets based on your data over time. With our help, businesses can confidently implement lasting strategies that contribute to reducing their environmental impact at scale.

Disclose emissions data to stakeholders

Companies and organizations of all sizes are coming under increasing pressure from their stakeholders to report on the impact their operations have on the environment. The carbon footprint assessment is an effective way for businesses to disclose detailed emissions data that documents an organization’s environmental and ESG performance, enabling them to demonstrate environmental leadership and transparency.

Doing so means satisfying increasingly stringent compliance requirements from investors, regulators, and customers alike.

But figuring out how to calculate your carbon footprint can be challenging for many firms. Brightly Stream offers a one-stop shop for organizations looking to make sense of popular reporting frameworks formatting, making it easy to produce comprehensive information about your company's emissions that can be shared with stakeholders. With reports providing interactive visualizations and easily digestible analysis of your org’s carbon footprint, showing what you're doing - or not doing - is much more transparent than ever before.

Stream Planned Measures Site

Things to consider when calculating your carbon footprint

When calculating your carbon footprint, there are many points to consider before taking action. First and foremost, it is important to determine if you need to follow a reporting framework for emissions. It's also important to recognize that your carbon footprint calculations will only give you part of the picture; understanding land use and water impact is also essential for creating an accurate environmental footprint.

And last but not least, no matter how detailed the analysis may be, you won't benefit from your carbon footprint calculation unless you take further action or initiatives after identifying potential areas of improvement. Ultimately, being mindful of these aspects can help ensure that your efforts are both meaningful and effective when it comes to reducing your environmental impact.

Let's take a closer look.

Do you need to follow a reporting framework?

When it comes to calculating your carbon footprint, one of the key things to consider is whether or not you should follow a particular reporting framework. The chosen framework can dictate the way in which emissions data are categorized and reported, so having those details predetermined can be helpful when beginning calculations.

Many companies turn to options such as CDP and ENERGY STAR for their reporting needs; however, it may be more beneficial to consider geographic-specific regulations (like NYC's local 97) or industry-benchmarks (such as GRESB for Commercial Real Estate) when determining which framework will provide the best guidelines.

Ultimately, it is important to research your options thoroughly so that you make the best decision for your circumstances and are able to develop an efficient and reliable reporting system.

Your calculation is only useful if you do something with it

Calculating your carbon footprint is a necessary first step to reduce your carbon emissions. It’s essential to have an understanding of the environmental impact a business or organization is causing in order to create a plan for greening it up.

But simply having an estimate of your carbon output can miss out on many opportunities to truly lower your producing ‘footprint’.

Brightly Stream makes it easier for companies to actively work towards reducing their carbon emissions by providing them with comprehensive action plans and technology that support those plans; giving businesses the tools they need to track, measure and achieve success in their carbon reduction goals.

A calculation of the carbon footprint isn’t enough; organizations must actually act upon that information with initiatives focused on sustainability and collaboration if they hope to make any real difference.

Simplify carbon footprint calculations and reporting with Brightly ESG software

As the worldwide focus on climate change increases, it’s more important than ever for businesses to know and track their carbon footprint. Fortunately, calculating your business’s carbon footprint is relatively simple, and there are many ways to reduce your impact once you know where you stand.

If you want to take things a step further and offset your emissions, Brightly ESG Software can help you make smart choices that positively impact both the environment and your bottom line. With its user-friendly interface, automated calculations, abundant data insights and customizable reporting, Brightly has the potential to transform how businesses monitor and manage their carbon footprints.

Speak to an expert today to learn more about how we can help your business go green - and start taking steps to reduce your carbon footprint now.