Reducing carbon emissions is so important in our efforts to achieve a net zero future. Carbon accounting software tools can help you keep track of your emissions so you can minimise your impact on the planet.
This kind of technology allows you and your business to transition toward a more sustainable future and greater environmental standards. For instance, achieving an ISO 14001 certification. In essence, carbon accounting is a useful tool that helps you with benchmark reporting.
But how can it help small businesses working to tackle climate change? Continue reading to find out more about carbon accounting software and how it can help.
What is carbon accounting?
Before we even get into the various carbon accounting tools available and how they can help both small and large enterprises, it seems fitting to dive further into carbon accounting. In simple terms, carbon accounting is a method used to measure the amount of carbon dioxide emissions a business is responsible for. Businesses that utilise carbon accounting get emissions data collection so they can accurately measure the number of carbon credits they should purchase to offset their previous emissions.
The aim behind carbon accounting is to provide a means whereby an organisation or business can accurately determine a fair amount of carbon credits to exchange between individuals, businesses, or third parties. It is also important to note that carbon accounting is occasionally referred to as greenhouse gas accounting. The process involves a business measuring its impact concerning carbon emissions and equally and fairly trading carbon credits between companies, states, and people within the carbon market.
Not just that, but the software itself enables businesses to reach sustainable development goals too. Measuring and managing greenhouse gas emissions can be rather challenging, but investing in a carbon accounting software platform allows for greater management practices and maintenance of efficient data collection. These tools also empower businesses to disclose their environmental footprint to stakeholders, address supply chain and compliance problems, and add business analytics to decarbonisation plans.
The purpose behind carbon accounting and what’s driving the growth
The primary purpose of carbon accounting is quite simple really. It is to allocate a set value to the greenhouse gas and carbon dioxide emissions created. This is so they can be numerically and accurately depicted in the carbon market as a financial value. In a world where we are all racing to net zero, businesses included, carbon accounting is positioned as a quantifiable measure that an individual or business can be held accountable for.
The carbon accounting software market has grown significantly and is predicted to rise to 9.61 billion USD between 2021 and 2026. Several different factors are driving this impressive growth. The main one is that there is demand for decreasing the overall costs businesses incur. Reducing energy consumption will allow them to eliminate inefficiencies and identify cost-saving opportunities.
An additional factor is that the number of government policies and regulations has increased drastically to minimise carbon footprint. Governments across the globe require businesses to adhere to greenhouse gas emission regulatory standards. This means measuring, observing, and monitoring carbon emissions.
Carbon accounting deals with three kinds of scopes – scope 1, scope 2, and scope 3 emissions. All of these include activities of your business that contribute to greenhouse gas emissions. Calculating carbon emissions is nothing new, but it is quickly becoming a vital industry-standard requirement for businesses globally. Harnessing the potential of carbon accounting software is essential for any growth-oriented business that wants to make a difference and future-proof its enterprise.