Only one in 10 major companies are comprehensively measuring and cutting emissions across their value chains, according to the latest research.
A Boston Consulting Group (BCG) investigation, Technology is the Fast Track to Net Zero, looked into more than 1,600 companies with at least 1,000 staff and revenues of between US$100m and more than US$10bn, and revealed that just 10% of major companies measure Scope 1, 2 and 3 emissions comprehensively. However, companies estimate an error rate of 25% to 30% in their emissions measurements.
The research reveals that measuring Scope 3 is still challenging for corporations and accounts for more than 90% of their emissions, but is a priority for only 12% of companies. Despite this, 45% of the corporations that partially measure their internal and external emissions declare that they have delivered significant cuts. This rises to 64% among companies that measure across all three emissions scopes. BCG said these measurements are crucial to help companies work towards net-zero goals and inform their decision-making on emissions reductions.
Organisations with automated solutions for emissions measurement, such as carbon artificial intelligence, are 2.2 times more likely to measure emissions comprehensively and 1.9 times more likely to reduce emissions in line with their ambitions.
A total of 70% or organisations reported generating at least US$1m in yearly benefits from cutting emissions, and 37% estimate that such benefits reach more than US$100m.
These include improved reputation, reported by 54% of companies; the same percentage cite lower operating costs. A total of 48% reported delivering “higher valuations”, 43% cited increased revenues, 40% received local taxation benefits, and improved staff recruitment and retention were acknowledged by 37%.
Policy incentives, such as regulation and state support, leadership support and the adoption of digital solutions for measurement, are seen as the main drivers that would accelerate emissions reductions.
"The time has come to urgently accelerate progress in terms of the measurement and reduction of emissions," said Hubertus Meinecke, global leader of BCG's climate and sustainability practice. "Leaders need to demonstrate true convictions and a willingness to drive cultural changes at both the company and governmental level, and organisations need to embrace the adoption of the digital and AI tools that are available to provide them with the most accurate and comprehensive measurement."
The companies are based across 18 countries, operate in 14 industries and are responsible for around 40% of the world’s emissions.