The collection and calculation of indirect greenhouse gas emissions along the entire value chain (Scope 3 emissions), pose particular challenges for telecommunications companies in their reporting practices. The study examines how telecommunications providers record their Scope 3 emissions along their upstream and downstream value chains. The sustainability reports of 16 European, publicly traded telecommunications providers were evaluated, and expert discussions were held with 15 representatives of telecommunications providers, associations, and municipal utilities in Germany.
Scope 3 emissions account for the largest share of total emissions in the telecommunications industry, particularly emissions from purchased goods and services, capital goods, and the use of sold products by commercial and private end customers. These three Scope 3 categories dominate among all European and German providers considered and show that the key emission drivers are comparable across the industry.
At the same time, the study shows that the recording of Scope 3 is inaccurate and subject to uncertainty due to its complexity, fragmented structures and processes, and limited data availability. In addition, the various possible reporting approaches sometimes generate widely differing results. Most companies have significantly expanded their re-porting in recent years, both in terms of the categories covered and the level of detail within the categories. As a result, these two aspects mean that comparability is only possible to a limited extent, both over time at the company level and between the reporting companies.
Industry-wide best practices have so far only been implemented selectively. The development of common approaches also depends on the size of the telecommunications providers. While smaller companies cooperate primarily in project-based association formats, larger multinational providers continue to develop common standards in international initiatives.
Overall, larger companies have more resources and are in a position to oblige their suppliers to cooperate more closely in reporting and implementing sustainability goals. Until the changes to the European legal framework in the wake of the CSRD and EU Omnibus Initiative, there had been uncertainty among smaller providers as to whether, and if so when, they would be subject to sustainability reporting requirements. This uncertainty has been largely removed with the adoption of the trilogue agreement. For companies that, contrary to expectations, will not be subject to reporting requirements, it is to be expected that the topic of sustainability and sustainability reporting will become significantly less relevant.
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Scope 3 emissions in the telecommunications industry (No. 544)
How do methodological approaches look alike and what are the main sources of emissions?
The study shows that Scope 3 emissions account for the largest share of total emissions in the telecommunications sector. They are particularly emitted through purchased goods and services, capital goods, and the use of sold products. Significant differences can be observed across companies in terms of methodological approaches and the level of detail.
