The Greenhouse Gas (GHG) Protocol is revising the Scope 3 Standard as part of merging its corporate standards with ISO 14064-1 into one global standard, targeted for the end of 2028. The proposed revisions appeared in a progress update on 31 March 2026.
Scope 3 is proposed to become a required part of a conforming corporate inventory. Companies would report at least 95% of their required Scope 3 emissions, and would quantify and justify what they leave out.
Companies would no longer be permitted to estimate purchases from a diversified supplier's company-wide emissions. Industry averages and benchmarks are still an option; companies that want supplier-specific accuracy would need product-specific data, which suppliers typically publish once a year.
Category 15 (investments) would cover only financed investments, apply explicitly to every company holding investments, and include the investee's Scope 3 emissions.
A new Category 16 would cover facilitated activities such as insurance, underwriting and licensing; it is optional for every company, and most of it concerns financial institutions and oil and gas distributors.
These are proposals. Public comment opens in the second quarter of 2027, and current standards stay in effect until the GHG Protocol communicates otherwise.
On 29 July 2026, the GHG Protocol confirmed that the Scope 3 Standard (2011) will merge with the Corporate Standard (2004), the Scope 2 Guidance (2015), the new Actions and Market Instruments workstream and ISO 14064-1 into one corporate standard. The draft opens for public comment in the second quarter of 2027, and the GHG Protocol aims to publish the final text at the end of 2028.
Until then: current standards remain in effect, so inventories, assurance engagements and reporting deadlines all stand.
This article cites two GHG Protocol publications: the Scope 3 Standard Revisions Phase 1 Progress Update of 31 March 2026, and the standard development announcements of 29 July 2026. The progress update describes the likely direction of the revision and states that its contents may change.
The proposals deserve attention now for two reasons. First, the revision would make Scope 3 reporting a required part of a conforming corporate inventory. Second, one proposal withdraws a widely used calculation method for supplier emissions. Assumptions, benchmarks and industry-average emission factors remain permitted; the change concerns companies that calculate a purchase's footprint from a diversified supplier's company-wide data. Replacing that method with supplier-specific data takes at least two annual reporting cycles, so collection started in 2026 delivers a usable series by the time the standard lands.
The GHG Protocol groups the proposed revisions into three series, coded by workstream:
Series A covers data quality
Series B covers boundary setting
Series C covers investments (Category 15)
The bracketed code after each proposal, (B1) for example, is the GHG Protocol's identifier for that revision in the progress update.
The table below orders the proposals by theme, the way a reporting team would encounter them: first the reporting boundary and exclusions, then the data behind the figures, then the category changes. The codes are kept for reference.
| Proposal | What applies today (Scope 3 Standard, 2011) |
What's proposed (progress update, 31 March 2026) |
Who it affects |
|---|---|---|---|
| Report at least 95% of Scope 3 (B1) | "Companies shall account for all scope 3 emissions and disclose and justify any exclusions." No percentage given. | "Companies shall account for and report at least 95% of total required scope 3 emissions." | Every company reporting Scope 3 in conformance with the GHG Protocol. A parallel Corporate Standard proposal would extend this to every conforming corporate inventory. |
| Quantify and justify exclusions (B2, B3, B5) | Exclusions are justified in words, without quantification. | Total Scope 3 must be quantified, by any estimation method including hotspot analysis, to show that exclusions stay within 5%. Insignificant (de minimis) emissions may be excluded within the 5% without quantification. | The same companies. This is the evidence step behind the 95% requirement. |
| Disclose exclusions in a standard format (B6, B7) | Exclusions are disclosed and justified; optional emissions merge into category totals. | Exclusions carry a standard notation, and required and optional emissions are reported separately. This row governs presentation; the row above governs quantification. | Every reporting company. |
| Corporate-level supplier data restricted (A8) | Chapter 8 permits allocating a supplier's corporate-level emissions to purchased goods, by physical quantity or by spend. | "Corporate-level data allocation shall not be used to calculate scope 3 emissions from value chain partners, except for homogeneous value chain partners." | Companies buying from large multi-product suppliers, above all in food and agriculture and in retail and consumer goods. |
| Disaggregate emissions by data type (A1) | Data sources are described in words, plus one figure: the percentage of emissions calculated from supplier data. | Each reported figure is split by calculation type: specific activity data with a specific emission factor, versus spend-based estimates. Classification rules are still under development. | Every reporting company. The spend-estimated share of the inventory becomes visible. |
| Disclose verification status (A2) | Assurance is optional, and so is saying whether it was obtained. | Companies that verify disclose the status: verified, partially verified, or not verified. Companies that skip verification take on nothing new. | Companies already obtaining assurance. |
| Unknown end use exclusion kept (B9) | Downstream emissions of intermediate products may be excluded where the end use is unknown. | The exclusion stays, and it sits explicitly outside the 5% threshold. | Ingredient and component manufacturers. A right preserved. |
| Category 15 narrowed and strengthened (C1, C2, C5, C6) | Written for investors and financial services companies; boundary covers the investee's Scope 1 and Scope 2, with Scope 3 "where relevant". Insurance and underwriting sit inside it. | Category 15 covers only financed investments. It applies explicitly to every company holding investments, all listed investment types become required, and the boundary extends to the investee's Scope 3. | Any company with joint ventures or minority stakes outside its consolidation boundary. |
| New Category 16 (B11, C3, C4) | The category does not exist; its contents sit inside Category 15. | A new category for facilitated activities: income earned from activities the company never buys, sells or owns, including insurance, underwriting and licensing. Optional for every company, financial institutions included; only oil and gas distributors must report it. | Mostly financial institutions and oil and gas distributors. For other companies, the optional licensing subcategory is the relevant part. |
Four of these proposals change the substance of the work rather than its presentation, and are analysed below: the required Scope 3 boundary and its exclusions regime, the disaggregation of data quality, the restriction on corporate-level supplier data, and the redefinition of Categories 15 and 16.
Today, a company claims conformance with the Corporate Standard by reporting Scope 1 and Scope 2. Scope 3 reporting is subject to the separate 2011 standard, which companies adopt by choice. According to the progress update, the Corporate Standard working group "is proposing requiring the inclusion of a company's scope 3 emissions to conform with the Corporate Standard (revised)".
Combined with the 95% proposal, a conforming corporate inventory would then contain three things: Scope 1 emissions with a tentative 1% exclusion threshold, Scope 2 emissions with the same tentative threshold, and at least 95% of required Scope 3 emissions.
To use the 5% exclusions allowance, a company would need to quantify its total Scope 3, including the activities it intends to exclude. Any estimation method is acceptable, including hotspot analysis: a high-level scan that shows where emissions concentrate, built from industry averages, spend-based proxies or other readily available data. Emissions reasonably expected to be insignificant fall under a de minimis clause and count within the 5% without quantification. Each exclusion then carries a standard notation in the disclosure, and required and optional emissions appear separately. For example, a company with an estimated 2 million tonnes of required Scope 3 emissions could exclude activities totalling up to 100,000 tonnes, provided it lists and flags them.
Two justified exclusions sit outside the 5% threshold altogether: downstream emissions of intermediate products whose end use is unknown, and select investment types.
The design principle is evidence in proportion to size. A company must show that what it leaves out is small, and may estimate rather than measure it. Companies already reporting Scope 3 comprehensively will find the regime formalises current practice. Companies reporting Scope 3 selectively, or claiming Corporate Standard conformance without Scope 3, face the largest change in this revision, and the place to start is the coverage arithmetic: current reporting, category by category, against Table 5.4 of the standard.
Whether regulators make Scope 3 reporting legally mandatory is a separate question, answered jurisdiction by jurisdiction; the FAQ below addresses it directly.
Today, a company describes its Scope 3 data sources in words and reports one figure: the percentage of emissions calculated from supplier data. The proposal adds structure: each reported figure would show how much of it came from each kind of calculation.
The distinction is between measured inputs and financial proxies. For example, emissions from purchased packaging calculated from tonnes of cardboard and an emission factor for cardboard would sit in one tier; the same emissions estimated from money spent on packaging would sit in a lower one. The disclosure would show how much of the total sits in each tier. The classification rules are still under development, and both options under consideration include an unclassified tier for companies unable to split their data.
The change makes estimation visible. The spend-estimated share of an inventory, which today sits inside a methodology annex, would appear on the face of the disclosure, where investors, customers and auditors read it. A company can calculate that share today from its existing inventory, and knowing it early shows where data upgrades matter most, because the split rewards moving high-emission categories from spend estimates to activity data over time.
"Corporate-level data allocation shall not be used to calculate scope 3 emissions from value chain partners, except for homogeneous value chain partners where it may be used."
Revision A8, Phase 1 Progress Update, 31 March 2026
Today, a company may take a supplier's total corporate emissions and allocate a share of them to its own purchase, using physical quantities or spend. Chapter 8 of the current standard permits this.
The proposal withdraws the method for diversified suppliers (suppliers that make many different types of products) and keeps it only for homogeneous suppliers (suppliers whose output is essentially one product with uniform emissions).
Companies may still use industry-average emission factors from databases, spend-based proxies and other secondary data; the progress update lists these as acceptable methods, and nothing in the proposal requires suppliers to hand over primary data. The restriction removes one method only: calculating a purchase's footprint from a diversified supplier's company-wide figures.
For example, a food manufacturer buys cocoa from a trading group that also handles palm oil and flour. Today, the manufacturer may estimate its cocoa footprint from the group's total emissions: spend on cocoa multiplied by the group's emissions per dollar of revenue. The proposal ends that calculation, because a group-wide average across three commodity businesses says little about cocoa. The manufacturer could fall back on an industry-average emission factor for cocoa, or step up to product-level data from the supplier.
Companies that choose the step up face the calendar. Suppliers publish emissions data once a year, so a company that requests product-level data in 2026 sees its first usable figures in the 2027 reporting cycle and its first year-on-year comparison in 2028, when the final standard is due. A company that waits for the final text before engaging suppliers would carry the data gap years into the new regime. Of all the proposals, this is the one where acting before the consultation pays off directly.
The exposure concentrates where supply chains run through diversified traders and processors, which is why food and agriculture and retail and consumer goods carry most of it. The first analytical step is short: rank suppliers by spend, mark the diversified ones, and flag those modelled with a corporate-level intensity figure.
The Category 15 and Category 16 proposals are two halves of one redrawing, so they read best together.
Category 15, investments, is written today for investors and financial services companies; the current standard calls it "designed primarily for private financial institutions". It also holds insurance-associated activities, underwriting and other financial services. The proposals narrow the category and strengthen it at the same time. Insurance, underwriting and the other financial services move out, into the new Category 16. What remains is financed investments only, and three things tighten around them: the category applies explicitly to every company holding investments, all listed investment types become required, and the boundary widens from the investee's Scope 1 and Scope 2 to include its Scope 3, replacing today's "where relevant" wording.
For non-financial companies, the widened boundary is the operative change. A joint venture in processing or logistics, or a minority stake outside the consolidation boundary, would carry the investee's full value chain emissions rather than its operational emissions alone. The exposure sits in a document most sustainability teams have never worked through: the investment register held by finance, listing joint ventures, minority holdings and investments outside the consolidation boundary.
Category 16, "other value chain activities", receives what leaves Category 15 and adds a licensing subcategory. It covers facilitated activities, meaning income earned from activities the company never buys, sells or owns. Reporting is optional for every company, financial institutions included; the one exception is oil and gas distributors, who would be required to report facilitated emissions. Because Category 16 is optional, it also sits outside the 95% requirement: the progress update states that the 95% inclusion requirement does not apply to optional Scope 3 emissions, and Category 16 is reported separately from required Scope 3 so that it does not distort comparability between years or between companies.
Category 16 has drawn the most news attention of any proposal, yet most of its content concerns financial institutions and oil and gas distributors. For other companies, the relevant piece is licensing, which gives brand licensors and franchisors a defined, voluntary place to report the emissions their licensing enables.
Five preparations hold their value whatever the final text says, because each also strengthens an inventory under today's rules.
Continue reporting under current standards. The GHG Protocol has confirmed they remain in effect, and existing deadlines in Australia, the EU, Japan and California are unchanged.
Quantify total Scope 3, including currently excluded activities, with a hotspot analysis. This is the evidence the proposed exclusions regime asks for, and it immediately tests whether anything large sits outside the current boundary.
Calculate the spend-estimated share of the inventory. That share becomes visible under the data quality proposal, and it shows where data upgrades matter most.
Identify exposure to the supplier data rule. Rank suppliers by spend, mark the diversified ones, and flag those modelled with a corporate-level intensity figure. Supplier engagement on product-level data can then start with the highest-exposure names.
Obtain the investment register from finance, and prepare a consultation position. Joint ventures, minority holdings and investments outside the consolidation boundary define the Category 15 exposure. Public consultation opens in the second quarter of 2027, and the GHG Protocol accepts working group applications on a rolling basis; companies with complex supply chains have the most riding on the supplier data rule.
Sources: GHG Protocol, Scope 3 Standard Revisions: Phase 1 Progress Update, 31 March 2026; GHG Protocol, Corporate Value Chain (Scope 3) Accounting and Reporting Standard, 2011; GHG Protocol, Key Standard Development Updates and Consolidated Standard Development Plan, 29 July 2026.