Demonstrably lower CO2e emissions with low administrative burden
With companies subject to the CSRD required to report on their carbon emissions in their annual report from the 2024 financial year onwards, smaller collaboration parties are also being confronted with the question of what their share of the footprint of the entire supply chain is. And how to prove that. ‘It is meanwhile clear what we have to publish in terms of emission data,’ says Guido de Wit, programme manager at Topsector Logistiek, ‘but how to make that transparent is something everyone is still racking their brains over.’ Carbon Added Accounting offers the solution. ‘This method lets you easily show how much of the total CO2e emissions of a product or service are down to you, and comply with laws and regulations. At the same time, it empowers you to improve your competitive position.’
It is attracting a lot of companies
EU legislation on the transition towards sustainability is meanwhile very concrete: CSRD, CBAM and the addition of road transport to the Emissions Trading System… ‘The pressure to report based on real data is increasing,’ says Guido, ‘especially since CO2e emissions will be taxed in the short term. After all, you don’t want to pay for someone else’s emissions. This is leading companies that are subject to the CSRD, such as supermarket chains and construction companies, to ask their suppliers for Scope 3 footprint information. And these suppliers often request the same from their suppliers. This gets the whole industry moving.’
CO2e emission allocation
Guido: ‘Even though the details of the CSRD are still being developed, it is now 95% clear what companies have to publish in terms of emission data. But how to be transparent on that and how to share the information across the supply chain without an enormous administrative burden, that’s something that everyone is still racking their brains over. Providing proof turns out to be complicated, especially in complex, international supply chains.’ This is why Topsector Logistiek developed Carbon Added Accounting: a practical carbon accounting method that covers the entire production chain. ‘It is roughly comparable to the VAT that you charge for your part of the work. You charge on your share of the CO2e emissions. Since you also state an indication of the quality of your own data and that of those before you in the supply chain, the reliability and accuracy of the total footprint of a product or service across the complete supply chain becomes clear.’
Data complies with auditors’ requirements
‘That reliability is crucial, because of the role of auditors. They have to audit and sign off on emission figures before they can be included in the annual report. In doing so, they look not only at the end results, but also at the supporting information provided. Is that information complete? Accurate? On time?’
Carbon Added Accounting makes it easy to supply verifiable CO2e emission data. This is important not only for companies and auditors, but also for governments and consumers, as it enables them to compare companies, products, and services, and thus make conscious choices. For companies, it is also a way to set themselves apart from the competition.
Verifiable data strengthens competitive position
With more and more CO2e data being measured and shared, it is increasingly important to properly substantiate sustainability ambitions, also for companies where business practices have been sustainable for years already. Guido: ‘Since everyone is now focusing on sustainability out of necessity, you have no choice but to allocate CO2e to your products and services to set yourself apart from the competition. You have to show based on actual data that you are sustainable, including in comparison to others. That data provides a lot of insight. Insight into, for example, which parts of the supply chain produce the most emissions. And into efficiency. The difference between production lines at new sites and those at slightly older ones is, for example, clear to see in the footprint by product. This enables companies to take targeted action and thus improve both their ability to set themselves apart from the competition and their competitiveness on sustainability. Carbon Added Accounting provides them with concrete ways of doing that.’
Calculating emissions from an egg or tulip
‘What we as Topsector Logistiek find important is that we get a smart, efficient solution that is simple in how it works,’ according to Guido. ‘I believe in that. The easier it is to use, the faster companies will start using it and the sooner everyone can take targeted action.’
That supply chain-wide use of Carbon Added Accounting works is confirmed by various cases that Topsector Logistiek worked on together with companies. By identifying the emissions from each link in the supply chain – agricultural/extraction, production, logistics, and retail – emissions relating to tulips, beer, paint, eggs, and packaging were already calculated. ‘Carbon Added Accounting is a standard that works well for both large and small companies. For those with ultimate responsibility at companies, this system is nice to work with, because it is based on cost accounting. It is a familiar way of working for anyone with a financial background and is, therefore, easily accepted.’
These companies went before you
Joost Wesselman, owner-manager of Wesselman Flowers, teamed up with Topsector Logistiek to work out the emissions from tulip growing. ‘Carbon Added Accounting lets us calculate the footprint by product across the entire supply chain, giving us insight into our complete business process. This insight enables us to further move our operations towards sustainability in a targeted manner. And ensure compliance with EU laws and regulations in the process. Simply based on figures we already have available at our company.’
Carbon Added Accounting has given Udea insight into the total CO2e emissions of their organic and biodynamic egg supply chains. From feed to shop shelf. Steven IJzerman, quality manager at Udea, phrases it as follows: ‘The main insight we have gained is that when a farmer goes about it the right way, they will have a positive impact on emissions. I’m really pleased with that, because it confirms the great value of organic and biodynamic agriculture. We are eager to engage with others on these verifiable insights, on how we can become even more sustainable.’
What was it like to use the Carbon Added Accounting method in practice? ‘Collecting all the data is tricky, but once you have all the data, it is easy to load into the system. It instantly provides a visual of how the emissions are spread over the entire supply chain: over the agricultural part and the transport and over the warehousing and shops. The system is also easy to repeat. It is easy to add another egg supplier or replace a supermarket, following which you quickly get a good idea of the consequences of such modifications.’
Driving real change
‘The companies we work with as part of Carbon Added Accounting are making me very happy,’ says Guido enthusiastically. ‘They are all so committed! They inspire me and show that it is really possible to establish the emissions from an egg, a tulip, or a glass of beer. It is wonderful to be able to work together with such frontrunners. To show together that you can be transparent on your emissions and subsequently take targeted action to reduce them. To work more efficiently and thus be more competitive. By making that clear, we are able to win over others to also take steps and calculate their emissions. And once we have managed to do that, we can achieve real change!’
Want to be transparent on your emissions and improve your competitive position?
Topsector Logistiek is working together with entrepreneurs, governments, and research institutions for competitive and emission-free logistics in the Netherlands, including through Carbon Added Accounting. On www.carbonaddedaccounting.org, you will find detailed information, can read all about companies’ experiences with it, and find guidelines to enable you to take a targeted step towards the future. Together, we will move faster and get further.
If you still have questions, please feel free to get in touch with Guido de Wit.