Scope 3 Categories
Breakdown of upstream and downstream emissions
Overview
Scope 3 emissions are organized into 15 categories defined by the GHG Protocol, split between upstream (categories 1-8) and downstream (categories 9-15). Each category represents a specific type of indirect emission source in the value chain, from purchased goods to product use and end-of-life treatment.
15 categories total
Split into upstream (1-8) + downstream (9-15)
Category Structure
Upstream (Categories 1-8)
1. Purchased goods and services
2. Capital goods
3. Fuel- and energy-related activities
4. Upstream transportation and distribution
5. Waste generated in operations
6. Business travel
7. Employee commuting
8. Upstream leased assets
Downstream (Categories 9-15)
9. Downstream transportation and distribution
10. Processing of sold products
11. Use of sold products
12. End-of-life treatment of sold products
13. Sold products
14. Franchises
15. Investments
Not all categories are equally material
Most Material Categories (Very Important)
While all 15 categories are defined, only a subset is typically material for any given company. Materiality depends on industry, business model, and value chain structure.
Purchased goods and services (Category 1)
Raw materials, components, outsourced services
Use of sold products (Category 11)
Energy use, emissions from product operation
Investments (Category 15)
Equity, debt, project finance emissions
Most companies focus on top 2-3 categories
Financial Relevance
Each Scope 3 category links to specific financial drivers, translating emissions into business activities and risk areas.
Purchased goods (Category 1) → input cost
Product use (Category 11) → customer demand
Investments (Category 15) → portfolio risk
Financial Mechanisms
Category → cost driver
Category → risk driver
Category → revenue driver
Real Pathways
Purchased goods pathway
Purchased goods → supplier emissions → cost increase
Product use pathway
Product use → regulation → revenue impact
Investments pathway
Investments → portfolio risk → valuation
Strategic Use
Prioritization
Focus on high-impact categories
Target setting
Set category-specific reduction targets
Resource allocation
Allocate effort where impact is highest
Categories help companies focus effort where impact is highest
Key Takeaways
15 categories split into upstream and downstream
Not all categories are equally material
Most companies focus on top 2-3 categories
Each category links to specific financial drivers
Categories turn emissions into actionable decisions
Scope 3 categories turn emissions into actionable business decisions.