Plan A

Operationalizing organizational boundaries begins with codifying the chosen consolidation approach—equity share, financial control, or operational control—as a mandatory attribute on every ledger entity record (legal entity, facility, joint venture). Create a governance dimension in your chart of accounts that stores: consolidation approach, ownership percentage, and control rationale. Journal templates should calculate proportional emissions automatically: for equity share, multiply activity-derived emissions by ownership percentage; for control approaches, post 100% for controlled operations and zero for non-controlled. Maintain a boundary register mapping financial entities to reporting entities with effective dates to support base-year and structural change recalculations. Enforce validation rules that prevent posting without a boundary method and ownership value, and version these fields for audit. Where joint operations have mixed control, store both “management control” and “GHG consolidation basis” to reconcile internal KPIs with external disclosure. Align boundary logic with Scope definitions (e.g., lease arrangements) and include documentation links (contracts, governance memos) in the entry’s evidence bundle. Regularly review boundary choices during M&A events and lease transitions to avoid drift from the selected methodology.

A carbon ledger is a structured, auditable record of emissions data and calculations organized as entries with sources, methods, factors, and approvals—akin to a financial general ledger for greenhouse gases. Unlike a periodic GHG inventory that presents aggregated totals for reporting, a carbon ledger captures transaction-level activity data (e.g., kWh by meter, liters of fuel by asset, ton-km by lane), the emission factors applied, calculation logic, and change history. This granularity supports traceability, controls, and re-statement when factors or boundaries change. It also enables multi-dimensional rollups (by site, cost center, supplier, product, or project) and facilitates external assurance. A robust ledger aligns with the GHG Protocol on boundaries, scopes, and consolidation approach, and with ISO 14064-1 principles for relevance, completeness, consistency, accuracy, and transparency. Practically, a ledger underpins repeatable reporting across frameworks (e.g., CSRD/ESRS, SBTi tracking) and allows drill-down to evidence (utility bills, contracts, meter telemetry) during audits. It becomes the operational backbone for continuous emissions monitoring, rather than a once-a-year spreadsheet exercise. Key Takeaway: A carbon ledger is a transaction-level, auditable system of record that turns annual inventories into controllable, repeatable, and assured emissions accounting.

GHG Protocol primary data collection involves gathering site-specific activity data directly from operations, suppliers, and value chain partners rather than using industry averages, enabling more accurate carbon accounting and CSRD-compliant reporting.