The GHG Protocol is undertaking its first major revision of the Scope 3 standard since the original was published in 2011. The revision - signaled by a Phase 1 Progress Update in March 2026 - will strengthen primary data requirements, clarify category boundaries, update land-use change guidance, and align the standard with financial-grade reporting frameworks like CSRD and ISSB. Used by over 90% of Fortune 500 companies, the GHG Protocol sets the global baseline for carbon accounting, and these changes will reshape how every company measures its value chain emissions.
For 15 years, the GHG Protocol Corporate Value Chain (Scope 3) Standard has been the definitive framework for measuring emissions beyond a company's direct operations. It covers 15 categories of value chain emissions - from purchased goods and services to end-of-life treatment of sold products - and for most companies, Scope 3 represents 70-90% of their total carbon footprint.
But the world of carbon accounting has changed dramatically since 2011. Regulatory mandates like the EU's CSRD and the CBAM now require emissions data with a level of precision and auditability that the original standard was never designed to support. The revision aims to close that gap.
This guide explains what is changing, why it matters, and what companies - particularly Indian exporters and multinationals - should do to prepare.
What's Changing in GHG Protocol?
The GHG Protocol, jointly convened by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), launched a comprehensive review process in 2022. After extensive stakeholder surveys and technical working groups, a Phase 1 Progress Update was released in March 2026 outlining the direction of the revisions.
This is the first significant update to the Scope 3 standard since its original publication. The Corporate Standard (Scope 1 and 2) and the Scope 3 Standard are both under review, but the Scope 3 changes are the most consequential because of how fundamentally value chain accounting is evolving.
Scope: Revisions to the Corporate Standard, Scope 2 Guidance, and Scope 3 Standard
Last update: The original Scope 3 Standard was published in 2011 - 15 years ago
Adoption: Used by 90%+ of Fortune 500 companies for carbon accounting
Categories: The standard covers 15 Scope 3 categories across upstream and downstream value chains
Trigger: Growing regulatory demand (CSRD, ISSB, SEC) for auditable, primary-data-based emissions reporting
Why the Revision Matters
The original 2011 Scope 3 standard was a groundbreaking achievement - it gave companies a common language for measuring value chain emissions for the first time. But several limitations have become clear over the past decade:
- Data quality gap: Most companies still rely heavily on spend-based estimates and industry-average emission factors rather than actual supplier data. The result is Scope 3 inventories that are directionally useful but not precise enough for regulatory compliance or investor scrutiny.
- Category boundary confusion: Companies interpret category boundaries differently, making comparisons across peers difficult. Where does Category 1 (purchased goods) end and Category 4 (upstream transportation) begin? The current standard leaves room for inconsistent treatment.
- Financial-grade reporting: When the Scope 3 standard was written, emissions data was primarily used for voluntary CDP disclosures and sustainability reports. Now, regulations like the EU's CSRD require emissions data that can withstand limited assurance audits - a fundamentally different bar.
- Land use and removals: The original standard provided limited guidance on biogenic emissions, land-use change, and carbon removals - areas that have become critical as companies set SBTi net-zero targets.
"The GHG Protocol standards must evolve to support the growing demand for high-quality, decision-useful greenhouse gas data across the global economy." - World Resources Institute, GHG Protocol Review announcement
Key Changes in the Scope 3 Revision
Based on the Phase 1 Progress Update and stakeholder consultation documents, here are the major areas of change:
| Area | Current Standard (2011) | What's Changing |
|---|---|---|
| Primary data emphasis | Primary data encouraged but not required; spend-based and average-data methods widely accepted | Stronger requirements to use primary (supplier-specific) data for material Scope 3 categories; clearer hierarchy of data quality |
| Supplier engagement | Guidance on supplier engagement is general and aspirational | Specific frameworks for supplier data collection, verification, and capacity building; alignment with PACT/Pathfinder data exchange standards |
| Category boundaries | Some category boundaries are ambiguous (e.g., between Categories 1, 4, and 9) | Clearer definitions and decision trees for categorizing emissions; reduced double-counting risk across categories |
| Land use and biogenic emissions | Limited guidance; land-use change emissions often excluded or inconsistently reported | Updated methodology for FLAG (Forest, Land, and Agriculture) emissions; alignment with SBTi FLAG guidance |
| Market-based vs. location-based | Dual reporting for Scope 2; less clarity for Scope 3 electricity-related emissions | Guidance on when market-based approaches can be applied within Scope 3 categories (e.g., supplier electricity procurement) |
| Regulatory alignment | Designed primarily for voluntary reporting | Explicit alignment with CSRD/ESRS, ISSB (IFRS S2), and other mandatory disclosure frameworks |
Impact on Indian Companies
Indian companies face converging pressures that make the GHG Protocol revision particularly consequential:
BRSR and Scope 3
India's Business Responsibility and Sustainability Reporting (BRSR) framework already mandates Scope 1 and Scope 2 emissions disclosure for the top 1,000 listed companies. BRSR Core - which requires reasonable assurance - is expanding. While comprehensive Scope 3 reporting is not yet mandatory under BRSR, SEBI has signaled that value chain emissions disclosure will deepen over time. The revised GHG Protocol will set the methodology that BRSR Scope 3 requirements reference.
CSRD Value Chain Requirements
Indian companies that supply to EU-headquartered corporations are already being asked for emissions data under the EU CSRD. The CSRD requires companies to report Scope 3 emissions using GHG Protocol methodology. As the standard tightens its primary data requirements, EU buyers will pass those expectations directly to their Indian suppliers. Companies that cannot provide facility-level or product-level emissions data risk losing contracts.
CBAM and Product-Level Data
The EU's Carbon Border Adjustment Mechanism requires embedded emissions data at the product level for steel, cement, aluminium, fertilizers, and hydrogen. While CBAM has its own calculation methodology, the underlying data infrastructure - measuring direct and indirect emissions per unit of production - aligns closely with what the revised GHG Protocol will require. Companies building CBAM compliance systems are already building Scope 3 readiness.
SBTi Target Setting
Companies with Science Based Targets (SBTi) commitments are required to measure and reduce their Scope 3 emissions. The revised standard will directly affect how SBTi validates targets and tracks progress - particularly for near-term targets that require Scope 3 reduction pathways.
Primary Data vs Secondary Data
The single biggest shift in the revision is the push toward primary data. Understanding the distinction is critical:
What Is Primary Data?
Primary data (also called supplier-specific data) comes directly from the entity responsible for the emissions. Examples include:
- A steel supplier providing the actual carbon footprint per tonne of their specific product
- A logistics provider sharing fuel consumption and emissions per shipment
- A packaging manufacturer reporting facility-level energy use and process emissions
Primary data is more accurate, more auditable, and increasingly required by regulations. It also enables companies to identify specific reduction opportunities within their supply chain.
What Is Secondary Data?
Secondary data uses proxy values - industry averages, emission factor databases (like DEFRA, ecoinvent, or the US EPA), or spend-based estimates (e.g., "$1M of purchased steel x average emission factor per dollar"). It is easier to obtain but less precise and less actionable.
When to Use Each
The revised standard is expected to introduce a clearer data quality hierarchy:
- Material categories first: For the Scope 3 categories that represent the largest share of your emissions (typically Categories 1, 3, 4, and 11), primary data should be the goal
- Phased approach: Start with your top 20 suppliers by emissions impact - they often represent 60-80% of your Scope 3 footprint
- Secondary as supplement: Use secondary data for long-tail suppliers and non-material categories, with a plan to progressively shift toward primary data
- Hybrid methods: Combine primary data for key inputs (e.g., actual energy consumption) with secondary factors for minor inputs
Supplier Engagement Strategies
Collecting primary data at scale requires structured supplier engagement:
- Standardized questionnaires: Use frameworks like the CDP Supply Chain program or the PACT (Partnership for Carbon Transparency) data exchange standard
- Capacity building: Many suppliers - especially SMEs in India - need training on how to measure and report their emissions. Include this in supplier development programs
- Contractual requirements: Embed emissions data sharing in procurement contracts. This is already standard practice for Tier 1 suppliers to major European and American multinationals
- Technology platforms: Carbon accounting software can automate data collection, validation, and aggregation across hundreds of suppliers
Timeline and Implementation
The GHG Protocol revision is following a phased approach:
| Timeline | Milestone | What to Expect |
|---|---|---|
| 2022-2023 | Survey and scoping | Stakeholder surveys identified priority areas for revision; technical working groups formed |
| 2024-2025 | Technical development | Working groups developed draft guidance on key topics (primary data, category boundaries, land use) |
| March 2026 | Phase 1 Progress Update | Published summary of direction and key decisions; signals to companies on where the standard is heading |
| Late 2026 | Draft standards for consultation | Public comment period on revised Corporate Standard, Scope 2 Guidance, and Scope 3 Standard |
| 2027 | Final publication (expected) | Revised standards published with implementation guidance; transition period for companies to adopt |
Companies should not wait for the final publication to begin preparing. The direction of travel is clear, and the data infrastructure needed - primary data collection, supplier engagement programs, and upgraded accounting systems - takes 12-18 months to build.
How to Prepare
1. Audit your current Scope 3 inventory. Review your existing Scope 3 calculations. Which categories are you reporting? What data sources are you using? Where are the biggest gaps between secondary estimates and actual emissions? Start with our GHG Calculation services if you do not have a current inventory.
2. Identify material categories. For most companies, 3-5 of the 15 Scope 3 categories represent 80%+ of value chain emissions. Focus your primary data efforts on these. See our glossary for category definitions.
3. Engage your top suppliers. Start with your top 20 suppliers by procurement spend or estimated emissions. Request facility-level or product-level emissions data. Provide templates and training where needed.
4. Upgrade your data systems. Move beyond spreadsheets. Invest in carbon accounting software that can ingest primary data from suppliers, apply emission factors for secondary data, and produce audit-ready reports.
5. Align with regulatory requirements. If you report under BRSR, supply data to EU customers under CSRD, or export CBAM-covered goods, map the overlap. Build one data system that serves all frameworks.
6. Build internal capacity. Train your sustainability team on the GHG Protocol methodology, primary data collection, and emissions factor selection. The revised standard will require deeper technical expertise than the current one.
7. Set a baseline now. Calculate your Scope 3 emissions under the current standard so you have a baseline year. When the revised standard is published, you will need to understand how the methodology changes affect your numbers and restate your baseline if necessary.
Understanding the 15 Scope 3 Categories
For reference, the GHG Protocol defines 15 categories of Scope 3 emissions, split between upstream and downstream:
Upstream (Categories 1-8)
- Category 1: Purchased goods and services (often the largest category)
- Category 2: Capital goods
- Category 3: Fuel and energy-related activities (not in Scope 1 or 2)
- Category 4: Upstream transportation and distribution
- Category 5: Waste generated in operations
- Category 6: Business travel
- Category 7: Employee commuting
- Category 8: Upstream leased assets
Downstream (Categories 9-15)
- Category 9: Downstream transportation and distribution
- Category 10: Processing of sold products
- Category 11: Use of sold products (major for energy, automotive, electronics)
- Category 12: End-of-life treatment of sold products
- Category 13: Downstream leased assets
- Category 14: Franchises
- Category 15: Investments (significant for financial institutions)
The revision will clarify boundaries between these categories and provide more specific calculation guidance for each - reducing the current ambiguity that leads to inconsistent reporting across companies.
Frequently Asked Questions
The revision introduces stronger requirements for primary (supplier-specific) data over secondary (industry-average) data, clearer category boundary definitions, updated guidance on land use and land-use change emissions, and better alignment with financial-grade reporting standards like CSRD and SEC climate rules. It is the first major update since the original Scope 3 standard was published in 2011.
The GHG Protocol released a Phase 1 Progress Update in March 2026 outlining the direction of changes. Draft revised standards are expected for public consultation, with final publication anticipated in late 2026 or 2027. Companies should begin preparing now as the changes will require significant data infrastructure upgrades.
Indian companies face Scope 3 pressure from multiple directions. BRSR already requires Scope 1 and 2 reporting, with Scope 3 disclosure expanding. EU CSRD requires European buyers to report value chain emissions, pulling Indian suppliers into the reporting chain. CBAM requires product-level emissions data. The revised GHG Protocol will set the methodology standard for all of these frameworks.
Primary data is supplier-specific emissions information collected directly from the source - for example, the actual carbon footprint of steel purchased from a specific mill. Secondary data uses industry averages, emission factor databases, or spend-based estimates. Primary data is more accurate but harder to collect. The revised Scope 3 standard will increasingly require primary data for material emission categories.
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