ESG ESG Climate Change & Carbon Management

Question 1

What are 'Scope 3 emissions' in the GHG Protocol Corporate Standard?

Accepted Answer

All indirect emissions in a company's value chain not covered by Scope 2, including upstream suppliers and downstream product use

Answer

Scope 3 covers 15 upstream and downstream categories including purchased goods, business travel, employee commuting, and end-of-life product treatment—typically the largest share of a company's footprint.

Question 2

What criteria must emissions reduction targets meet to be certified by the Science Based Targets initiative (SBTi)?

Accepted Answer

Align with the level of emissions reductions required to meet Paris Agreement goals, following SBTi methodology validation

Answer

SBTi validates that targets are grounded in climate science—specifically aligned with pathways to limit warming to 1.5°C—using sector-specific methods and covering relevant emission scopes.

Question 3

What is the primary difference between 'carbon neutral' and 'net-zero' claims?

Accepted Answer

Carbon neutral typically involves offsetting residual emissions; net-zero requires deep absolute reductions with only minimal residual offsetting

Answer

Carbon neutrality often relies heavily on carbon offsets to balance residual emissions, while genuine net-zero (per SBTi/IPCC) requires 90-95% absolute emission reductions before any residual neutralization.

Question 4

What is an 'internal carbon price' (ICP) and how is it used?

Accepted Answer

A shadow price applied to carbon emissions in internal business decisions to incentivize low-carbon investment choices

Answer

ICPs embed a hypothetical cost on carbon in capex decisions, project approvals, and business cases, steering internal investment toward lower-emission options before external carbon pricing applies.

Question 5

What does 'carbon accounting' under the GHG Protocol require companies to select before calculating emissions?

Accepted Answer

An organizational boundary approach: equity share, financial control, or operational control

Answer

The GHG Protocol requires companies to define organizational boundaries using one of three consolidation approaches, which determines which operations' emissions are included in the inventory.

(ESG) Certified Environmental, Social, and Governance Consultant Practice Test

(ESG) Certified Environmental, Social, and Governance Consultant Practice Test

ESG ESG Climate Change & Carbon Management