Ford vs Toyota: Ford (F.N.) vs. Toyota (7203.T) to reduce emissions? These questions help investors discover climate heroes and laggards for their portfolios. The well-known Greenhouse Gas Protocol (GHGP) Corporate Standard and future U.S. and European regulations may not give final remedies.
Western companies report pollution using the 2001-2004 Greenhouse Gas Protocol (GHGP). The Global Harmonized Harmonized System (GHGP) will be vital when the E.U. and U.S. establish standards next year. Companies might interpret emissions reporting categories differently.
The GHGP revealed company emissions but didn’t allow comparisons. Investors can’t effectively evaluate firms, particularly with new restrictions. Alpha Financial Markets Consulting CEO Vanessa Bingle said that although more companies share emissions data, quality varies.
Top automakers’ suppliers report varied Scope 3 emissions. Twenty of the top thirty manufacturers say emissions data, but each does it differently and with different aims. Only five vehicle manufacturers disclosed their cars’ average lifespans and CO2 equivalent emissions per kilometer. Comparing automobiles was complex.
Subaru’s problem. In 2021, the business told CDP its cars might go 130,000 kilometers (80,000 miles). North America and the E.U. define distances differently, complicating difficulties.
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Scope 3 emissions are challenging to measure since consumers and suppliers must submit information. Untraceable numbers are useless. Some customers prefer third-party data from other sites to compare, even when provided and formatted differently.
Green energy for Scope 2 emissions complicates matters. The GHGP provides market- and location-based methods. Market-based methods may hide an organization’s carbon effect.
The E.U. mandates carbon disclosure for over 50,000 companies to fight greenwashing, and the U.S. will follow. Laws should trump industry standards. Best practices, market forces, peer pressure, and sector-specific disclosures will improve data in five years, according to GHGP opponents. Countries may seek independent emissions statement audits.
Because corporations employ various reporting methodologies, assumptions, and assumptions, investors need help comparing and understanding emission statistics. To address the global climate catastrophe, businesses’ transition plans, investments, and carbon emissions must be examined. The globe follows emissions standards and audits.