Why Nobody Measures the Scope 4 (Avoided) Emissions? Let’s Get It Started!

Pietro De Giovanni ()
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Pietro De Giovanni: Strategy and Operations Knowledge Area and DIR—Claudio Dematté Research Division, Sustainable Operations and Supply Chain Monitor, 20136 Milan, Italy

Sustainability, 2025, vol. 17, issue 18, 1-27

Abstract: As the urgency of climate action intensifies, organizations are increasingly required not only to reduce their instantaneous internal emissions (Scopes 1 and 2) and their value chain impacts (Scope 3), but also to demonstrate their overall contribution to climate change. Therefore, this paper introduces and formalizes the concept of Scope 4 emissions, defined as avoided emissions enabled by a company’s products, services, or business models, representing the fourth strategic pillar in corporate climate accounting. The paper proposes how to quantify the Scope 4 emissions through the decarbonization plan, using a stadium decarbonization plan as an illustrative example to show how Scope 1–3 reductions can be complemented by cumulative Scope 4 impacts, the advantages of undertaking proactive approaches toward sustainability and proposing the concept of relative carbon neutrality. Finally, the paper connects the Scope 4 emissions with ESG factors, highlights possible risks and challenges associated with its computation, and inviting regulators and policy makers to devise new Scope 4-based policies and incentives needed when considering the directives’ dynamics (e.g., the Omnibus Package).

Keywords: avoided emissions; Scope 4; climate accounting; decarbonization plans (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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