Greenhouse Gas (GHG) Protocol Explained

What is the GHG Protocol?

The Greenhouse Gas (GHG) Protocol is a structured approach to measuring and managing GHG emissions across businesses and organisations globally. Established by the World Business Council for Sustainable Development (WBCSD) and the World Resources Institute (WRI), the protocol is now integral to corporate and governmental carbon reporting. It lays out a framework for businesses to understand their emissions and take necessary steps toward reducing their environmental impact.

A Brief History of the GHG Protocol

The Greenhouse Gas Protocol was established in 1998 to address the need for a standardised framework to globally track and manage emissions. Global attention on climate change prompted its creation, aligning with the greenhouse gases identified by the international agreement, the Kyoto Protocol, in 1997. Over the years, the GHG Protocol has published several standards, evolving to include detailed standards for measuring emissions in supply chains, products, and even entire cities.

2001: Published the first edition of the Corporate Standard, or the GHG Protocol Corporate Accounting and Reporting Standard.
2004: Released a revised second edition of the Corporate Standard, incorporating improvements from early application
2011: Introduced the Corporate Value Chain (Scope 3) Standard and the Product Life Cycle Standards, expanding the scope to supply chain emissions and the full product lifecycle.
2013: Issued the Product Life Cycle Standards and Scope 3 Calculation Guidance, along with amendments to the Corporate Standard
2015: Released the Scope 2 Guidance, establishing how companies measure and report purchased energy emissions
2022-2023: Opened a public consultation period from November 2022 to March 2023, gathering over 1,400 survey responses on the Corporate Standard, Scope 2 Guidance, and Scope 3 Standard.
2024: Established a new multi-stakeholder governance structure, including a Steering Committee, an Independent Standards Board, and four Technical Working Groups to oversee the revision process of its corporate standards.
2025: Developed updates for the Corporate Standard, Scope 2 and Scope 3 Standards and Action and Market Instruments for release in 2026.
2026: Published the Land Sector and Removals (LSR) Standard

Why do businesses rely on the GHG Protocol for carbon reporting?

The GHG Protocol, at its core, is designed to help organisations with GHG emissions reporting, including quantifying, managing, and reducing their carbon footprint. It develops and continues to refine its standards, as is the case for the Scope 2 Guidance, which is undergoing review following public consultations from 2025.

By classifying emissions into three categories, scopes 1, 2, and 3, the GHG Protocol offers a clear view of where emissions are coming from. These categories cover emissions from both a company’s operations and those that extend throughout its value chain. The framework’s structured approach allows businesses to take targeted action for greenhouse gas management and reduction, progress tracking, and alignment with international sustainability goals. This also guarantees transparent and consistent carbon emissions reporting, which is an advantage in meeting regulatory requirements, building investor credibility, and improving overall sustainability performance.

Who uses the GHG Protocol?

The Greenhouse Gas Protocol is used by a wide range of entities, including businesses, governments, private institutions, and non-governmental organisations (NGOs). It is the standard framework for carbon reporting in many industries and is widely adopted by corporations, including about 97% of S&P 500 companies. Cities and countries also use the GHG Protocol to measure emissions, set climate goals, and track progress toward national and international targets.

Beyond voluntary adoption, a growing number of regulations and standards, both globally and locally, either directly require or are closely aligned with the GHG Protocol methodology.

Which ESG frameworks work alongside the GHG Protocol?

The GHG Protocol framework is widely complementary and embedded in other major ESG frameworks.

Carbon Disclosure Project (CDP): Many companies must report their emissions to the CDP using the GHG Protocol. This requirement is because the CDP’s questionnaires are structured around the GHG Protocol’s standard accounting methodology for emissions.
International Sustainability Standards Board (ISSB): The IFRS Foundation, which holds the ISSB, partnered with the GHG Protocol for GHG disclosures. The ISSB’s IFRS S2 sustainability disclosure standard applies the GHG Protocol Corporate Standard as its required methodology for measuring and disclosing scope 1, 2, and 3 emissions.
Global Reporting Initiative (GRI): One of the most broadly adopted frameworks globally, the GRI incorporates the GHG Protocol methodology into its environmental disclosure requirements. The GRI’s newly released standards, GRI 102 for climate change and GRI 103 for energy-related data, will be formally adopted in 2027 for emissions disclosures.
Corporate Sustainability Reporting Directive (CSRD): Through its European Sustainability Reporting Standards (ESRS), the European Union’s CSRD requires large companies to report GHG emissions that are directly aligned with the GHG Protocol methodology.

What are the GHG Protocol scope emissions?

Understanding and managing all three types of emissions helps companies build a comprehensive strategy to tackle their carbon footprint. To define GHG for ESG reporting, the Greenhouse Gas Protocol divides emissions into three distinct categories.

Scope 1 Emissions

Scope 1 emissions are from direct and on-site sources that the company owns or controls, such as fuel used in company vehicles or emissions from manufacturing processes. Scope 1 examples include:

Usage of owned backup generators
Fuel combustion from company trucks
Carbon released from the production of cement and steel

Scope 2 Emissions

Scope 2 emissions are from indirect sources that are purchased and generated off-site. These can be electricity, steam, or heat used in company operations. Scope 2 exists in these cases:

Steam bought from a local utility plant to run industrial equipment
Electricity consumed by data centre servers that are continuously running
Main grid power used to light and air-condition the corporate office building

Scope 3 Emissions

Scope 3 emissions are all indirect emissions beyond scope 2 and are known as supply chain emissions. These occur throughout a company’s value chain, including everything from the primary sourcing and production of materials to employee commuting. Examples include:

Third-party shipping company transporting finished products overseas
Company employees driving their personal cars to and from the office
Customers charging or powering electronic products after purchase

What are the GHG Protocol standards?

The Greenhouse Gas Protocol offers several standards to guide organisations in tracking and managing emissions. Each of these standards is designed to address different challenges, whether it’s understanding emissions from a specific product or evaluating the effectiveness of a climate policy.

Corporate Standard: Aimed at companies and organisations of all types, the standard provides a framework for building a corporate-level GHG emissions reporting and inventory.
Corporate Value Chain Standard: This helps organisations and companies measure emissions across their entire value chain.
Product Standard: This offers guidelines to organisations and companies for assessing emissions associated with the complete life cycle of individual products.
Mitigation Goal Standard: This standard allows countries and cities to set and track emissions reduction goals.
Policy and Action Standard: This is best for countries and cities to evaluate the impact of specific policies on GHG emissions.
Project Protocol: Applicable to both companies and organisations, as well as countries and cities, this calculates and accounts for the impact of the climate change reduction projects and initiatives.

Is the GHG Protocol mandatory?

The GHG Protocol on its own is not a legal requirement, but it is the foundation for many climate reporting regulations. It has also become effectively unavoidable for companies operating under growing local and global regulations that either explicitly require or are directly aligned with the GHG Protocol methodology.

How can companies implement GHG Protocol standards?

Implementing the GHG Protocol involves several steps:

Choose the appropriate standard: Depending on the company’s emissions profile and required regulations, such as the CDP, ISSB, and CSRD, businesses should select the relevant standard to follow throughout.
Build a GHG inventory: The first step is to create an inventory of emissions, categorising them into scope 1, scope 2, and scope 3, depending on the source. There is ESG software, like Presgo, equipped with a GHG Protocol-aligned carbon calculator that is designed to streamline the measurement process. This technology applies and provides emission factors and global warming potential values for a company’s collected GHG data.
Analyse the inventory: Companies should review and interpret their emissions data to identify the biggest sources of emissions, whose scopes contribute most, and where reduction opportunities are most feasible.
Set reduction targets: With a clear understanding of emissions, companies can set short- and long-term reduction targets aligned with their country or region’s net zero commitments. For reference, most EU member states, Japan, and South Korea target net zero by 2050, while China aims for 2060. These can also be benchmarked against the globally recognised Science Based Targets initiative (SBTi).
Take action: Implement the specific strategies, such as energy efficiency improvements, switching to renewable energy, and engaging with suppliers to reduce scope 3 emissions.
Monitor and report: Regularly update the GHG inventory and communicate its progress through sustainability reports. Using ESG reporting software can also help centralise emissions data across all three scopes in one place, establishing more accurate and consistent tracking.

FAQs on the GHG Protocol

What is the Greenhouse Gas Protocol?

The GHG Protocol is a leading global standard for tracking and managing greenhouse gas emissions across organisations, cities, and governments.

Who created the GHG Protocol, and why?

The Greenhouse Gas Protocol was created by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD) to provide a standardised framework for GHG emissions reporting globally.

What are scopes 1, 2, and 3 emissions?

Scope 1 is the direct emissions from sources owned or controlled by the company. Scope 2 refers to the indirect emissions from purchased energy. Scope 3 includes all other indirect emissions across the value chain.

How is the GHG Protocol different from ISO 14064?

The GHG Protocol is more widely adopted for corporate reporting and is the basis for several ESG frameworks, while ISO 14064 is used for verification and certification purposes. Both frameworks address carbon accounting.

How can a company start using the GHG Protocol?

A company can begin by selecting the appropriate GHG Protocol standard for its needs, building a comprehensive emissions inventory, setting science-based targets, and then developing strategies for emissions reduction.

How Presgo Supports GHG Protocol–Aligned Climate Reporting

Presgo is an AI-first ESG reporting software built to operationalise the GHG Protocol at scale. Its ESG solutions bring emissions data collection, calculation, and disclosures into one system so teams can seamlessly move from raw activity data to audit-ready climate reporting. The platform aligns directly with the GHG Protocol Corporate Standard and other standards, while supporting downstream reporting under global frameworks like GRI and SBTi.