How to calculate the carbon footprint of a company, step by step

To calculate the carbon footprint of a company, set your organisational and operational boundaries, collect activity data for each emission source, multiply it by a suitable emission factor, convert every gas to CO₂-equivalent using global warming potentials, and add the results by scope. The GHG Protocol Corporate Standard is the method most companies follow. The result is a GHG inventory you can track against a base year and have verified.

How to calculate the carbon footprint of a company: what you are measuring

A corporate carbon footprint, or GHG inventory, is the total greenhouse gas emissions of an organisation over a reporting period — usually a financial or calendar year — expressed in tonnes of CO₂-equivalent (tCO₂e). It covers the seven Kyoto gases and is reported by scope: Scope 1 (direct), Scope 2 (purchased energy) and Scope 3 (value chain). If the scopes are new to you, start with Scope 1, 2 and 3 emissions explained.

The GHG Protocol Corporate Standard sets five accounting principles that guide every decision below: relevance, completeness, consistency, transparency and accuracy. ISO 14064-1 follows the same logic with its own category structure. Both are being revised jointly — the GHG Protocol currently expects a joint GHG Protocol–ISO corporate standard in late 2028 — so the current editions remain the ones to apply.

Step 1: Set organisational boundaries

Decide which entities and assets are in the inventory. The GHG Protocol Corporate Standard offers three consolidation approaches:

• Equity share — report emissions in proportion to your ownership.
• Financial control — report 100% of operations whose financial and operating policies you direct for economic benefit.
• Operational control — report 100% of operations where you introduce and implement operating policies.

Pick one, apply it to every entity, and record the choice. Joint ventures, franchises and leased buildings are where most boundary errors appear.

Step 2: Set operational boundaries and identify sources

For each entity, list the emission sources and assign them to a scope:

• Scope 1: fuels in boilers, generators and vehicles; process emissions; refrigerant leaks.
• Scope 2: purchased electricity, steam, heat and cooling — reported both location-based and market-based (see location-based vs market-based Scope 2).
• Scope 3: screen all 15 categories, estimate their size, and decide which are relevant. Document why any are excluded.

Step 3: Collect activity data

Activity data is the quantity that causes emissions: litres of diesel, cubic metres of gas, kWh of electricity, kilograms of refrigerant topped up, tonne-kilometres of freight, passenger-kilometres flown, or money spent with a supplier. Physical units are preferred to spend wherever possible.

Good practice for data collection:

• Use primary records — invoices, meter readings, fuel cards, ERP exports — and keep them as evidence.
• Assign an owner for each site and data type, with a monthly or quarterly calendar.
• Note estimates clearly, with the method used (for example, extrapolating 10 months to 12).
• Run checks for gaps, duplicates and unit errors before calculating.

We cover practical methods in smart ways to collect emissions data.

Step 4: Choose emission factors

An emission factor converts activity data into emissions, for example kgCO₂e per litre of diesel or per kWh of grid electricity. Choose factors that are:

• Specific — national or regional grid factors over global averages; supplier-specific data over industry averages.
• Current — matched to the reporting year where possible.
• Recognised — published by a government agency, the IPCC or another credible source.
• Recorded — source, version and year stored against every calculation line.

For guidance on sources such as national grid factors, DEFRA and IPCC defaults, see our emission factors guide.

Step 5: Calculate emissions and convert to CO₂e

The core formula is:

Emissions (tCO₂e) = activity data × emission factor × GWP (where the factor is per gas)

Many published factors are already given in CO₂e. Where a factor is given per gas, multiply each gas by its 100-year global warming potential (GWP) from an IPCC assessment report. Under the IPCC Sixth Assessment Report (AR6), fossil methane has a GWP of 29.8, nitrous oxide 273 and the refrigerant HFC-134a 1,530. The GHG Protocol recommends the latest values; whichever set you use, apply it consistently and disclose it.

Illustrative worked example

A small manufacturer with one site. All activity data and the diesel, grid and flight factors below are illustrative — use the published factors that apply to your country and year. The HFC-134a GWP is the AR6 value.

Source	Scope	Activity data	Factor	tCO2e
Diesel in generators	1	20,000 litres	2.70 kgCO2e/litre	54.0
HFC-134a leaked from chillers	1	15 kg	GWP 1,530	23.0
Grid electricity (location-based)	2	800,000 kWh	0.70 kgCO2e/kWh	560.0
Business flights	3 (cat. 6)	300,000 passenger-km	0.15 kgCO2e/passenger-km	45.0
Total (illustrative)				682.0

For example, the refrigerant line is 15 kg × 1,530 = 22,950 kgCO₂e, or about 23.0 tonnes. A full inventory would also include market-based Scope 2 and the other relevant Scope 3 categories, which for a manufacturer are often dominated by purchased goods (category 1).

Step 6: Set a base year and a recalculation policy

A base year is the reference against which you track change and set targets. Choose the earliest year with reliable, verifiable data. The GHG Protocol expects base-year emissions to be recalculated when there are significant changes:

• Structural changes — acquisitions, divestments, mergers, outsourcing or insourcing.
• Methodology changes — new calculation methods or substantially better emission factors.
• Errors — discovered mistakes that are significant.

The standard leaves the significance threshold to the company, so define it in a written recalculation policy and apply it consistently. Organic growth or decline does not trigger recalculation.

Step 7: Report and verify

Report emissions by scope and gas where required, with the consolidation approach, GWP set, factor sources, exclusions and any recalculations. Then obtain third-party verification or assurance — limited assurance first, reasonable assurance where regulation or stakeholders require it. Verifiers sample entries and trace them back to evidence, so the audit trail you build in steps 3 to 5 decides how smoothly this goes.

The same inventory then feeds disclosures such as ISSB/IFRS S2, ESRS, BRSR and CDP, and target-setting — see net-zero target setting.

How EKOTRACE helps

EKOTRACE follows these steps in one platform. You define entities and the consolidation approach once; data arrives through collection calendars, bulk upload, ERP batch import and the supplier portal; each line is calculated with a versioned emission factor and GWP set, and maker-checker approvals keep evidence attached for verifiers. Inventories can be prepared under the GHG Protocol and ISO 14064-1, with base-year tracking and targets.

See our GHG accounting page or the EKOTRACE overview.

Frequently asked questions

What is the formula for calculating a carbon footprint?

Emissions equal activity data multiplied by an emission factor. If the factor is for a single gas, multiply the result by that gas's global warming potential to get CO₂e. Add the results across all sources and group them by scope.

How long does it take to calculate a company's first carbon footprint?

It depends on the number of sites and the state of your records. Scope 1 and 2 for a small organisation can be done in a few weeks; a first Scope 3 screening usually takes longer because it relies on purchasing and supplier data.

Do we need to include Scope 3 in our carbon footprint?

The GHG Protocol Corporate Standard requires Scope 1 and 2 and treats Scope 3 as optional, but many disclosure rules, customers and target-setting frameworks expect it. Screen all 15 categories and report those that are relevant.

Which GWP values should we use?

Use 100-year GWPs from an IPCC assessment report; the GHG Protocol recommends the latest (AR6). Some regulatory schemes specify a particular set, so check what your reporting framework requires and disclose the set used.