ESG for the bank. ESG reporting.

The article considers calculation of greenhouse gases for the bank. These calculations affect the bank’s ESG rating. They are part of the general reporting for exchanges and investors.

The calculation is carried out according to international standards in the field of greenhouse gas emissions calculation:


Scope 1


The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard is a standard that contains all the information necessary for reporting on the calculation of greenhouse gas emissions (hereinafter referred to as GHG) for organizations. The standard specifies all reporting requirements, prescribes instructions for data collection. The main focus is on the calculation of GHG emissions by Scope 1 / Scope 1 (direct emissions of organizations).


The Russian Standard with a description of calculations for Scope 1 is presented by Order of the Ministry of Natural Resources and Ecology of the Russian Federation № 300 dated June 30, 2015 “On Approval of Methodological guidelines and Guidelines for Quantifying Greenhouse Gas Emissions by Organizations Engaged in Economic and Other Activities in the Russian Federation”


Scope 2


GHG Protocol Scope 2 Guidance – Standard for determining indirect energy Emissions of GHG – Scope 2 / Scope 2.


Russian Standard with methodology for calculating emissions of Scope 2 – Order of the Ministry of Natural Resources of the Russian Federation dated 29.06.2017 № 330 “On approval of methodological guidelines for quantifying the volume of indirect energy emissions of greenhouse gases”


Scope 3


The rules for calculating emissions by Scope 3 in GHGProtocol are issued in 2 documents:


Technical Guidance for Calculating Scope 3 Emissions calculation methods for other indirect emissions – Scope 3 / Scope 3 are collected, the issues of distribution of GHG emissions of Scope 3 between 15 categories of emission sources are worked out in detail.


Russian Standard – Russian legislation does not regulate the calculation of Scope 3 emissions.


The Corporate Value Chain (Scope 3) Accounting and Reporting Standard contains rules and procedures for reporting on Scope 3. Reporting objectives, reporting boundaries, setting emission reduction goals and monitoring their implementation are considered.


Russian Standard – Russian legislation does not regulate the calculation of Scope 3 emissions.

Calculation of the Carbon Footprint

The Concept of Carbon Neutrality

Example of calculation by Scope 1

Scope 1, according to international standards, considers GHG emissions in 4 categories: stationary combustion, mobile combustion, technological emissions, fugitive emissions.


The categories considered often depend on the type of reporting organization. Below are 2 examples of companies and categories that are taken into account in their activities:


1. Office in the city. For such an organization, you will need information about:

  • stationary equipment that is a source of fuel combustion, such as boilers, boilers, etc.;
  • vehicles owned by the organization/managed by the organization;
  • if there is air conditioning equipment in the office – information about the refrigerants used, their quantity.


2. A large manufacturing company. In this case, it is highly likely that GHG emissions will need to be calculated for all four Scope 1 categories.

  • Furnaces, burners, turbines and other equipment operating by burning fuel can act as sources of emissions from stationary combustion.
  • Mobile combustion and fugitive emissions from refrigeration and air conditioning equipment are calculated similarly to Example 1.
  • Also, most likely, it will be necessary to take into account technological emissions – this category includes emissions from waste incineration and chemical and physical processing processes.


Regardless of the category, the first step in calculating GHG emissions is data collection. The necessary data are, first of all, the quantitative values of the fuel used for combustion, the amount of refrigerant filled, the quantitative characteristics of the materials used, which are subjected to chemical and physical processing, as well as the waste incinerated.


Next, you need to find the coefficients that will be used in the calculation. GHG Protocol refers to the American EPA databases, in which the required coefficient can be found. You can use local coefficients, for example, to determine emissions from waste, you should refer to regional databases, where you can find emission coefficients depending on composition, humidity and other characteristics.




Calculation of technological emissions is a separate area of analysis, where different industries have their own reference books, calculation methods and emission factors.


As an example, consider the greenhouse gas emissions of the Moscow office.


In this case, emissions are generated only as a result of mobile fuel combustion and the use of refrigerants in refrigeration equipment.

The organization owns one passenger car.


Data on annual fuel consumption were used as input data for calculating emissions from mobile combustion. As initial data for the calculation of fugitive emissions, i.e. emissions from the use of refrigerants, data on the amount of refrigerant filled into the equipment were used.

As a result of calculations, the following results were obtained (Table 1):


Table 1 Example of calculation of Scope 1 emissions



International GHG calculating methodology standards

Example of calculation by Scope 2

Scope 2 includes indirect emissions that are generated during the production of energy that the company consumes. This energy can be electrical and thermal, and emissions from the production of steam and cold are also taken into account.


The first step, as in Scope 1, is to gather information. Quantitative data on energy consumption is needed, for example, if we are talking about electricity consumption, we need its quantity in kWh. Such data can be obtained from special consumption metering devices (meters) or from energy bills.


Further, before proceeding with the search for factors, it is necessary to refer to the Scope 2 emission standard, which describes that the choice of factors differs depending on the way energy is purchased. There are two accounting methods: market and regional:


  • Market-based: Scope 2 GHG emissions quantification method based on the GHG emissions of the company from which the consumer purchases electricity. The market method is used when there are energy purchase contracts with information on emission factors for the energy purchased.
  • Regional: Scope 2 GHG emissions quantification method based on average GHG emission factors determined for a specific geographic region, including local, subnational and national boundaries. In Russian practice, in the vast majority, the regional method is more often used, so it is necessary to focus on the method of energy production in the region.


At this stage in Russia, the organization’s greenhouse gas calculation has not yet become widespread, which is why many electric and thermal power plants do not have their own emission factor per unit of energy produced. Therefore, it becomes necessary to independently calculate the GHG emission factor.


For example, to calculate the GHG emission factor for a power plant where energy is produced using natural gas, the following data is needed:

  • conversion factor of tons to tce for stationary combustion of fuel – gas (t.e.f./t),
  • emission factor tCO2 in tce for stationary combustion of fuel – gas (tСО2/t.e.f.),
  • specific consumption of standard fuel – URUT (t/kW*h)

* t.e.f. – tons of equivalent fuel


After calculating the coefficient, you can proceed to the calculation of the organization’s greenhouse gas emissions for Scope 2.


As an example, let’s also turn to the calculation for the Moscow office.

In this case, when calculating Scope 2, the regional method is used: in the Moscow region, electricity is produced mainly at CHPPs using natural gas.

The data on energy consumption for the reporting period were used as initial data.

The results obtained from the calculation of greenhouse gas emissions for Scope 2 are shown in the table.


Table 2 Example of Scope 2 emissions calculation



Accounting for greenhouse gas emissions

Example of calculation by Scope 3

Scope 3 includes 15 Categories. 2 standards in the GHG Protocol are entirely dedicated to 3 Reach. It is the most voluminous in terms of the number and types of emissions taken into account.


With Scope 3, you need to be especially careful when defining the boundaries of the calculation. The most common and applicable to almost all types of organizations categories are:

  • Category 1 – purchased goods and raw materials;
  • Category 4 – transportation and delivery of raw materials, purchased materials and components (emissions from vehicles delivering purchased products);
  • Category 5 – treatment of generated waste by third parties;
  • Category 6 – business trips and business trips of employees;
  • Category 7 – travel of employees to work.


For these categories, the GHG Protocol has provided emission factors in conjunction with the EPA. For example, in order to calculate emissions from waste processing by third-party organizations, it is enough to know information about the type of waste and the type of disposal (landfill/reuse/incineration/recycling), and then select a coefficient depending on the initial data.

In order to calculate emissions from employee travel (Category 6 and 7), it is sufficient to know the distance traveled by employees, the type of transport used and the number of trips.


Let’s give an example with the results of calculation of GHG emissions for the Moscow office.


  • Scope 4 includes emissions from the delivery of goods needed for office operations. For example: office paper, drinking water. For calculations, data on the approximate distance of delivery, average fuel consumption and the number of deliveries per year were used.

During the calculations, the following emission data were obtained (Table 3):


Table 3 Example of Scope 3, Scope 4 emissions calculation


  • Category 5 of Scope 3 takes into account emissions from generated office waste. Presumably, the resulting waste is subject to burial at landfills.Landfill emissions include emissions from transportation to landfill and uncontrolled greenhouse gas emissions from landfill. GHG emissions data are based on standard landfill gas collection methods and average humidity conditions at landfills.In the absence of data on the exact composition of waste, it was assumed that the bulk of the waste generated is office paper.The results are shown in table 4.


Table 4 Example of Scope 3, Category 5 emissions calculation


  • Category 6 of Scope 3 takes into account emissions from business trips of employees.For the calculation, a method was used based on the distance traveled and the type of transport used. The calculation took into account the return trip.The results obtained in the calculations of greenhouse gas emissions are shown in the table below:Table 5 Example of calculation of Scope 3 emissions,Category 6


  • Category 7 of Scope 3 takes into account emissions from employee commuting and electricity consumption by employees working remotely.The calculation of emissions from electricity consumption by employees working from home was calculated similarly to the emissions of Scope 2. It was assumed that remote employees are also located within the Moscow region.To calculate the employees working in the office, a method was used based on the distance traveled and the type of transport used, the return trip was taken into account.The results obtained in the calculations of greenhouse gas emissions are given below:Table 6 – Results of calculation of GHG emissions by Scope 3, category 4



Based on all of the above, we can draw several main conclusions:


  • The quality of calculations and their accuracy directly depend on the source data provided. The more detailed and accurate the data, the more efficiently GHG emissions can be calculated.
  • Much attention should be paid to the coefficient. It is required to study very carefully the available databases with coefficients, as well as pay attention to the units of measurement when calculating.
  • Taking into account the specifics of Scope 3 -it is always necessary to set the limits of the greenhouse gas emissions taken into account and to register all the assumptions made in the report.