IBM is making an update to its Envizi ESG Suite software that will allow for the calculation and analysis of Scope 3 greenhouse gas emissions.
The new product, IBM Envizi: Scope 3 GHG Accounting + Reporting, uses artificial intelligence to take in, organize, and manage data required to make emissions calculations. The technology offers coverage of all fifteen Scope 3 categories, including factors such as waste generated by operations and end-of-life treatment of sold products. Scope 3 emissions are defined as those that occur outside of a company’s value chain, and they are therefore more difficult to track. Envizi makes the tracking process less time-consuming and allows for more accurate reporting, IBM said.
According to IBM, a large majority of companies consider themselves "mature" in using sustainability data tracking, but less than half admit they are able or ready to report on Scope 3 emissions. Since Envizi is able to categorize spending data from financial or ERP systems, it works to address some of the largest obstacles companies face in Scope 3 reporting.
The new Envizi function includes a GHG emissions calculation engine with more than 40 variations of calculating methodologies and templates used to fill out framework questionnaires. The platform also helps companies identify their emissions hotspots through data capture and tagging, then creates a visual to demonstrate impact clearly to various stakeholders.
According to an Insightia report, 63% of the largest 500 U.S. companies voluntarily report on Scope 3 emissions. Recent legislation has also been proposed that would make Scope 3 emissions reporting a requirement for companies with revenue over $1 billion.
Scope 3 emissions account for the largest percentage of emissions for most organizations. Therefore, in order for companies to fully understand the range of their climate impacts, many contend that Scope 3 emissions must be tracked.
"Growing regulatory requirements and external interests are driving organizations to disclose GHG emissions, including those from Scope 3," said Christina Shim, vice president and global head of product management and strategy for IBM sustainability software. "As requirements increase and as organizations prioritize enhancing operational insights, so does the need for robust, auditable data management, calculation, and reporting processes. IBM Envizi is now integrated with the new capabilities to help organizations seamlessly garner insights from spend data to facilitate Scope 3 emissions calculations for ESG reporting."
