The 2021 Value Change Labs: explore and address Scope 3 accounting challenges

On March 31st, participants representing over 18 companies across different sectors – including Danone, Mars, PepsiCo, VF Corporation – kicked off the first of a two-lab stream for Value Change members to explore and collectively define solutions to Scope 3 accounting and claims related challenges.

If you are familiar with Value Chain or Scope 3 emissions, you know that besides being the largest source of corporate carbon footprint they are also the most difficult to manage and that practical guidance on how to account and reduce these emissions is hard to come by. The Value Change Initiative brings together leading corporate actors, civil society, and internationally recognized frameworks to bridge this gap.

Through programs, working groups, labs or pilots, Value Change members co-create best practice guidance and tools approved by Gold Standard to reduce and credibly report on Scope 3 emissions reductions.

Labs are structured in 5 sessions, where participant discuss, learn and share real-world experiences to collectively identify challenges and define solutions. The 2021 Accounting Lab, which kicked off on March 31st with participants from over 18 companies, will explore the guiding conditions, definitions, and principles for a Scope 3 market-based accounting approaches, to see how value chain actors can collectively invest in Scope 3 emission reductions at scale and credibly account for the impacts that are achieved. The Accounting Lab will also provide addenda or adjustments to related concepts in existing value change guidance documents.

The 2021 Claims Lab, which is scheduled to begin on April 14th, will aim to provide common definitions and guiding principles for an integrated claims framework. The increase of corporate climate claims and terminologies – Carbon Neutral, Climate Neutral, Net Zero, Climate Positive, etc. – and their difference in meaning – type of pollutants covered, extent of value chain coverage, time frame of emissions covered, mitigation levers used, etc. – means there is a lack of clarity about what impacts can be assigned to what claims. Uncertainties and inconsistencies about the way claims are being used creates a barrier for Scope 3 action at scale. An integrated claims framework is urgently needed to remove ambiguity on what impacts can be recognized where. Claims Lab participants will work together to define and draft common definitions, guiding principles and conditions for such a framework to be developed.

The Accounting Lab will run from March 31st to November 17th. The Claims Lab will run from April 14th to December 1st. Both will require participants to provide feedback and inputs in between sessions.