Scope 3 measurement and reducing value chain carbon emissions
Landsec worked with the Carbon Trust to develop a methodology and Scope 3 model that enabled the company to measure carbon emissions across its entire value chain. Going through this process allowed Landsec to identify specific opportunities to work with stakeholders in order to reduce environmental impact outside of the company’s direct operational control, helping to deliver on ambitious sustainability goals and meet the requirements of the Science Based Targets Initiative.
Landsec is the largest listed commercial property company in the UK and a constituent of the FTSE100 index. Founded in 1944, the business now owns and manages more than 23 million square feet of office, retail, leisure and residential property.
The company has an ambition to be recognised as a sustainability leader in the real estate sector, hoping to move the industry forward through demonstrating the commercial value in improving environmental performance. As part of this Landsec became the first company globally in its sector to have successfully have a target recognised by the Science Based Targets initiative.
Following a project with the Carbon Trust to set a science-based target for its own operations (Read the full case study on the Science Based Targets website (PDF)), Landsec needed to better understand the indirect carbon emissions impact both upstream and downstream of the business. This would allow the company to set a meaningful Scope 3 goal that would meet the requirements of the Science Based Targets initiative.
In order to do this, Landsec sought further support from the expert team at the Carbon Trust to develop a Scope 3 footprint methodology document for the company, as well as a model to calculate emissions and track future progress.
The Carbon Trust took a hybrid approach to build the Scope 3 model. This leveraged existing procurement data held by Landsec which was assessed using environmentally extended input-output (EEIO) analysis to start to map out the upstream carbon emissions within the company’s supply chain. This was then supplemented with insights from high quality life cycle assessments that Landsec had previously commissioned to understand the impact of its major property developments. These calculations were used to improve data where relevant and available, particularly in areas of material impact.
However, it was also important to incorporate the Scope 3 carbon emissions downstream of the business. The most significant Scope 3 category for this is downstream leased assets – particularly the emissions arising from tenant energy use in properties owned or managed by Landsec.
The calculations from the model revealed the following key insights:
Based on the insights they gained from their Scope 3 measurement with the Carbon Trust, Landsec have been able to build a strategy to take action. This includes targets for engaging with all main contractors to encourage them to set their own science-based targets on climate change. In addition, the company has pledged to incrementally improve the energy efficiency rating of all leased floor area, setting a minimum threshold rating of E rating for all its tenants. During the project the Carbon Trust supported Landsec with the data and wording of their submission to the Science Based Targets initiative.
As a final outcome, Landsec was able to achieve all of its core objectives. The business has become the first property company globally to have an approved science-based target recognised internationally by the Science Based Targets initiative. Going through the process has also given the company a robust Scope 3 footprint baseline against which progress can be tracked year-on-year using a simple and effective model. And the insights from the model give the Landsec’s the crucial business intelligence needed to drive actions to reduce the environmental impact across its value chain and build a reputation for sustainability leadership.