It establishes comprehensive standards for both corporate accounting (used by companies) and value chain accounting (Scope 3). Its core function is to categorize emissions into three Scopes:

• Scope 1: Direct emissions (e.g., from owned boilers or vehicles).
• Scope 2: Indirect emissions from purchased energy (e.g., electricity).
• Scope 3: all the indirect emissions generated across the value chain (e.g., purchased goods, business travel).

This standardized methodology is critical for transparent reporting and enabling global net-zero commitments.