What to look for when choosing the right carbon accounting tool for your logistics supply chain emissions
As sustainability becomes central to corporate responsibility and regulatory compliance, companies with significant logistics supply chains are realising the importance of tracking and reporting their scope 3 emissions. You may already understand the need for a carbon accounting tool to meet these demands, but navigating the options on the market can be challenging. While many tools offer solutions to similar problems, their differences in features, data handling, calculation methodologies and integrations can significantly impact how well they meet your organisation's specific needs.
The first step in selecting the right tool
Selecting the right tool requires more than just picking a product that promises emissions tracking. A truly effective carbon accounting tool should align with your logistics operation’s unique workflows, seamlessly integrate with your existing systems and offer the transparency needed to trust and verify your data. Additionally, as regulatory standards and industry requirements continue to evolve, the ideal tool should offer flexibility to grow with your sustainability goals.
Before you begin evaluating carbon accounting tools, it's crucial to clearly define your carbon accounting goals, particularly around your supply chain emissions in Scope 3 Category 4 (Upstream Transportation and Distribution) and Category 9 (Downstream Transportation and Distribution). This step will ensure you select a tool that meets your specific needs and supports your sustainability objectives effectively. Here’s a step-by-step guide to defining your goals:
Align on Business Objectives: Start by asking: Why are we measuring these emissions? Is it for regulatory compliance, customer demand, or internal sustainability targets? Clarify these objectives to understand the level of detail and reporting capability you’ll need from a tool.
Set Your Level of Ambition: Determine how deeply you want to track and manage Scope 3 emissions. For instance, are you aiming for a full, granular picture across all logistics activities, or do you want a high-level overview to begin benchmarking? This can help you decide if you need detailed data breakdowns or more generalised metrics.
Identify Key Metrics: Ask your team: Which metrics will help us make decisions? Define whether you need emissions data by mode (e.g., air, sea, or road), distance, volume, or all of these. Knowing these specifics will guide your search for a tool that can break down data in the most relevant ways.
Determine Supplier Collaboration Needs: Since supplier data often forms the basis of Scope 3 reporting, assess how much direct collaboration you’ll need with suppliers. For example, do you need a tool that allows suppliers to input data directly to minimise your workload, or will you work with third-party data sources?
Plan for Future Goals: Consider how your reporting needs may grow. If you plan to expand your Scope 3 reporting in the future, look for a tool with flexibility to add other emissions categories or data sources. This will save time and costs in the long run.
By following these steps, you’ll have a well-defined understanding of your Scope 3 goals and can confidently begin searching for a carbon accounting tool tailored to your logistics emissions tracking needs.
Key Considerations When Choosing a Carbon Accounting Tool for Logistics
1. Cost and Return on Investment
When evaluating a carbon accounting tool, the cost is an essential factor, but it’s crucial to consider the long-term return on investment (ROI) as well. Pricing structures can vary widely, from per-user fees to tiered pricing based on emissions volume or features.
Think about:
Initial Setup and Integration Costs: Some platforms may require significant initial setup, while others are designed for easy onboarding with minimal expense.
Ongoing Subscription Fees: Assess if the tool’s pricing structure aligns with your budget and scaling needs, as logistics businesses often experience seasonal fluctuations.
Value-added Features: Look for tools that offer features such as automated data imports, predictive analytics and comprehensive reporting. These can save operational costs and enhance ROI.
Choosing a cost-effective tool that scales with your business will allow you to continue using it as your reporting needs evolve.
2. Integrability with Existing Systems
Seamless integration with your existing systems — whether that’s an ERP, TMS or other logistics software — is crucial for effective carbon accounting. If the tool can pull data automatically from these platforms, it will reduce manual data entry, minimise errors and provide a more cohesive overview of your carbon footprint.
Consider:
API Compatibility: Ensure the tool offers API capabilities that enable easy data exchange between systems and automated emissions calculations.
Data Import Flexibility: Look for a tool that can accommodate a variety of data formats and imports, as logistics supply chains often use data from multiple sources.
Scalability for Future Integrations: Even if you’re not integrating multiple systems immediately, selecting a tool with flexibility for future integrations can save time and resources down the line.
Integrability is a significant factor, as a tool that doesn't sync well with your systems may create more inefficiencies than it solves.
3. Carbon Emissions Calculation Methodology
For a tool to produce reliable data, it must use a robust carbon calculation methodology that aligns with recognised industry standards. Many companies seek tools that follow the Global Logistics Emissions Council (GLEC) Framework and are ISO 14083-compliant, as these standards provide credibility and consistency in emissions reporting.
Ask about:
GLEC Accreditation and ISO Compliance: Ensure that the tool aligns with GLEC and ISO 14083 standards to ensure your reports meet the benchmarks expected by regulators, clients and industry bodies.
Methodology Transparency: The methodology should be transparent and well-documented. The tool should be able to explain how emissions are calculated, whether through fuel-based, distance-based or weight-based methods.
Support for Multi-modal Emissions Tracking: Since logistics often involves several modes of transport, a robust carbon accounting tool should handle calculations across all transport modes with accuracy and consistency.
Accurate and standard-compliant methodologies are critical for producing credible reports that stakeholders trust.
4. Supplier Data Collection Capabilities
A significant portion of your supply chain emissions may come from third-party suppliers, so it’s essential that your carbon accounting tool can effectively collect and incorporate this data.
Consider tools that:
Enable Supplier Collaboration: Some tools offer a portal for suppliers to input their emissions data directly, streamlining the process and ensuring consistency.
Automate Data Requests and Reminders: Features like automated requests can prompt suppliers to provide emissions data, ensuring reporting deadlines are met without a constant manual follow-up.
Support Data Quality Verification: Tools that can verify and validate supplier data inputs enhance the reliability of your carbon footprint, especially when reporting scope 3 emissions.
This capability ensures that you can capture the full picture of your supply chain’s carbon footprint, which is especially valuable if you’re aiming to report on scope 3 emissions accurately.
5. Visualisation of Emissions Data
A powerful carbon accounting tool doesn’t just store numbers — it presents them in a way that’s easy to understand, interpret and act upon. Effective visualisation tools enable logistics companies to identify patterns, compare emissions across regions or suppliers, and track improvements over time.
Look for:
Customisable Dashboards: Dashboards that allow you to drill down by transport mode, supplier, region or other criteria provide flexibility to examine data from multiple angles.
Clear, Actionable Graphs and Reports: Graphs, charts and other visual aids make it easier to interpret data and communicate insights to stakeholders, from internal teams to external partners.
Forecasting Capabilities: Some advanced tools offer predictive modelling based on historical data, helping you anticipate emissions trends and adjust your operations accordingly.
With these insights, your team can track progress towards emissions reduction goals and make strategic decisions to improve sustainability across the supply chain.
Making Your Final Decision
When choosing a carbon accounting tool, weigh each of these factors according to your unique operational needs, budget and sustainability goals. A high-quality tool not only aligns with your current logistics framework but is also flexible enough to adapt to future changes. Many organisations choose to start with a pilot phase, enabling them to assess a tool's effectiveness before committing fully. Some tool providers provide a free trial period to allow customers to trial the product before committing.
Ultimately, the right carbon accounting tool will enhance your organisation’s ability to meet sustainability goals, satisfy regulatory requirements and communicate your environmental efforts transparently to stakeholders. By focusing on cost-effectiveness, integration capabilities, robust emissions calculation methodologies, supplier data handling and data visualisation, you can select a tool that streamlines carbon accounting, bringing measurable value to your business
Ready to streamline your Scope 3 emissions tracking? Pledge’s carbon accounting tool is designed specifically for logistics companies, offering seamless data integration, compliance with GLEC and ISO standards and intuitive visualisation features. Simplify your data collection and gain actionable insights into your upstream and downstream logistics emissions. Sign up for the Pledge Shipper Beta program to see how Pledge can help you achieve reliable, assurance-ready results with ease.