Scope 3 Emissions for Toll Manufacturing

Greenhouse Gas Protocol
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Hi everyone,

We’re working with a client who operates under a toll manufacturing model, and they’ve encountered some challenges in calculating their Scope 3 emissions.

For those unfamiliar, toll manufacturing involves a company performing production processes for a client using materials provided by that client. The company itself doesn’t own the raw materials, only processes them.

The client is unsure about what to include in their Scope 3 emissions, particularly when it comes to raw materials and services that are supplied by their customers. They also have questions about waste generated during production: is it their responsibility to report, or should the customer they’re producing for handle it? Additionally, they’re wondering how to address emissions related to the processing, use, and end-of-life stages of sold products—are these emissions their responsibility or their customers’?

Based on our research, we believe that raw materials provided at no cost by the client shouldn’t be included under the “purchased goods and services” category.

We’d really appreciate any insights or advice on this interpretation and how best to approach this issue.

Looking forward to your thoughts!

Kind regards
Jelte

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Hi. Sounds like the company provides a service, so i would approach it based on operational control - whatever they control, they account for, what they do not, they do not. So they control manufacturing efficiency, energy, waste management (as they can control how much more or less waste there will be) and what wold happen to it. Hemce anything outside of that is client’s responsibility eg. end of life of products

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I agree with the above. Using the operational control methodology, waste generated during the production would be reported by your client under category 5 and other thing relating to the product, i.e., use, end-of-life, would not.

In addition, I would also follow your same logic, where by the raw materials would not be included under purchased goods and services, as your client hasn’t purchased them.

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Hi @bemari & @barwright

Thanks for the clear explanation. It made everything much clearer. I really appreciate your help!

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