Information Center for Issuers

Morningstar Sustainalytics is collecting data on the 15 Scope 3 categories to provide investor clients with additional context on Scope 3 GHG emissions. Breaking down the data in terms of category* will help investors better understand Scope 3 GHG Emissions materiality and emissions exposure.

*Overview of Scope 3 Categories

The Greenhouse Gas Protocol divides Scope 3 emissions into 15 categories. These categories provide companies with a systematic framework to organize, understand, and report on the diversity of Scope 3 activities within a corporate value chain. The categories are designed to be mutually exclusive, so a company does not double count emissions between categories.  

1. Purchased goods and services
2. Capital goods
3. Fuel and energy-related activities
4. Upstream transport
5. Waste
6. Business travel
7. Employee commuting
8. Upstream leased assets
9. Downstream transport
10. Processing of sold products
11. Use of sold products*
12. End-of-life of sold products
13. Downstream leased assets
14. Franchises
15. Investments*

 *Morningstar Sustainalytics already collects Category 11 and Category 15 data.  

Morningstar Sustainalytics will use the data to: 

• Enhance our carbon emissions data product.
• Incorporate certain data points within the Low Carbon Transition Rating. This will enable us to enhance our Scope 3 modelling and give broader insights into the management of value chain emissions. 

By asking companies to specify whether their reporting of Scope 3 data is complete or partial, Morningstar Sustainalytics seeks to understand if a company has consolidated all subsidiaries under one company or whether it has included only some companies and/or select operations.

We deem coverage to be “complete” if the company discloses emissions as follows:

1. For all locations
2. For all operations
3. For all business divisions or segments or offices (for e.g., only the headquarters).

In all other cases, we deem coverage to be “partial”.

We are currently collecting Scope 3 data on each of the 15 categories for fiscal year 2023.

Examples of fiscal year periods include the following:

• January 1, 2023 - December 31, 2023
• April 1, 2022 - March 31, 2023
• July 1, 2022 – June 30, 2023