FLAG (Forestry, Land and Agriculture Guidance) GHG Accounting, Reporting and Target-Setting will change the way that most retailers calculate their scope three emissions.
FLAG currently accounts for 24% of annual GHG emissions, making the land sector key to climate goals. Although it has a role in emissions, it is also key to removals.
Importantly, FLAG will not be only relevant to retailers selling food. Although food retail and food to go are the most intensive land use retail sub sectors, it will also be relevant to sectors that use timbers, cotton, leather, paper and card and other commodities. Retailers will be required to calculate the share of scope 3 that occurs on farm and forestry. For many food products, up to 50% of emissions come from agriculture.
FLAG accounting, reporting and target setting will fall under two guidance areas:
- GHG Protocol Scope 3 & Land Sector Guidance (emission sources to include, what to disclose and calculation guidance)
- SBTi FLAG Guidance & Net Zero Standard (defines scale of emission reduction and removals required to align to Paris Agreement)
Our colleagues at 3Keel have produced a helpful webinar with more detail to help you through the process. Their key take-outs are:
- Split your Scope 3 inventory (probably just in “Purchased Goods”) into FLAG and Industry/Energy emissions. Using farm carbon tool data or secondary emissions factors.
- Ensure methods, emissions factors or tools cover key sources of land management and non-land GHGs (e.g., methane, soil N2O, fertilizer production, diesel use, etc.)
- Check relevance of land use change to agricultural products being footprinted and decide on appropriate calculation approach (likely to be calculated separately to land management)
- Exclude carbon removals unless it is informed by primary/measured data and monitoring is in place. Don’t use secondary emissions factors with carbon removals ‘embedded’ in data
- Select correct SBTi FLAG pathway method if setting targets – for the moment retailers are advised to use the ‘Sector pathway’ implemented in the SBTi’s FLAG Excel tool