GHG Protocol for Transport & Logistics

What is GHG Protocol?

The Greenhouse Gas (GHG) Protocol is the world's most widely used accounting and reporting standard for greenhouse gas emissions, developed jointly by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD). It provides a comprehensive framework that enables businesses, governments, and other organizations to measure, manage, and report their carbon footprint in a consistent, transparent, and credible way. Since its inception in 1998, the GHG Protocol has become the backbone of virtually every major emissions reporting initiative, including the EU's Corporate Sustainability Reporting Directive (CSRD) and the Science Based Targets initiative (SBTi).

GHG Protocol and the Transport & Logistics Industry

Transport and logistics is one of the most emissions-intensive sectors in the global economy, accounting for approximately 23% of global energy-related CO2 emissions. The GHG Protocol is directly relevant to this industry because fleet operations, freight movement, warehouse energy consumption, and last-mile delivery all generate significant greenhouse gas emissions that must be accounted for under the standard's three-scope framework.

For a large road freight operator running hundreds of diesel trucks, Scope 1 emissions — direct emissions from owned vehicles — represent the dominant emissions category. An international shipping company, by contrast, must also grapple with Scope 3 emissions from contracted ocean carriers, port operations, and the upstream production of the fuels it purchases. A third-party logistics provider (3PL) managing warehousing and distribution must track energy consumption across multiple facilities, monitor refrigerant leaks from cold-chain equipment, and increasingly account for the emissions associated with its entire supplier and customer network.

Regulatory pressure is intensifying this already complex picture. The EU's Carbon Border Adjustment Mechanism (CBAM), tightening emissions standards for heavy-duty vehicles, and customer-driven net-zero commitments are pushing logistics companies to adopt rigorous GHG accounting. Companies such as DHL, DSV, and Kuehne+Nagel have already embedded GHG Protocol methodology into their annual sustainability reports and customer carbon footprint calculators, setting a benchmark that mid-market logistics operators are now expected to follow.

Key Requirements

• Scope 1 emissions reporting: All direct emissions from company-owned or controlled sources must be measured and disclosed. For transport companies, this includes fuel combustion in owned trucks, vans, aircraft, ships, and trains, as well as fugitive emissions from refrigerants used in temperature-controlled vehicles and warehouses.
• Scope 2 emissions reporting: Indirect emissions from purchased electricity, heat, and steam must be accounted for using either the location-based or market-based method. Logistics firms operating large distribution centres, electric vehicle charging infrastructure, or automated warehouses face growing Scope 2 obligations as energy consumption scales.
• Scope 3 emissions reporting: Fifteen categories of value chain emissions must be assessed for relevance and, where material, quantified. For transport and logistics companies, the most significant categories typically include upstream transportation and distribution (Category 4), downstream transportation and distribution (Category 9), fuel and energy-related activities not covered in Scopes 1 and 2 (Category 3), and employee commuting (Category 7).
• Organizational boundary setting: Companies must define whether they apply an equity share, financial control, or operational control approach to determine which entities and operations fall within their GHG inventory. This is particularly relevant for logistics groups with joint ventures, franchised networks, or subcontracted carriers.
• Operational boundary setting: Once organizational boundaries are established, companies must decide which emission sources to include and document the rationale for any exclusions, ensuring that omissions do not materially misrepresent the total inventory.
• Activity data collection: Accurate fuel consumption records, electricity invoices, refrigerant top-up logs, and vehicle mileage data must be systematically collected and stored. Data quality tiers — from direct measurement to calculated estimates — must be documented.
• Emission factor selection: Appropriate, up-to-date emission factors must be applied to activity data. For fuel combustion, factors from bodies such as the IPCC, the UK DESNZ, or the European Environment Agency are commonly used. For freight transport, tonne-kilometre-based factors must reflect actual vehicle types and load factors.
• Base year establishment: A historical base year must be selected against which future performance is measured. Recalculation policies must be defined to address structural changes such as mergers, acquisitions, or divestments of fleet assets.
• Third-party verification: While not mandatory under the GHG Protocol itself, independent assurance of the emissions inventory is increasingly required by regulators (under CSRD), rating agencies, and major customers. Limited or reasonable assurance engagements must follow ISAE 3410 or equivalent standards.

Implementation Steps for Transport & Logistics Companies

1. Conduct a materiality assessment and gap analysis: Begin by mapping all operations — owned fleet, leased vehicles, contracted haulage, warehouse network, air and sea freight — and identify which emission sources are most material. Compare current data collection practices against GHG Protocol requirements to highlight gaps in coverage, data quality, and documentation.
2. Define organizational and operational boundaries: Formally document whether the operational control approach or financial control approach will be used. Identify all subsidiaries, joint ventures, and subcontractors that fall within scope and establish a policy for treating outsourced transport operations in the Scope 3 inventory.
3. Build a data collection infrastructure: Implement telematics systems on owned vehicles to capture real-time fuel consumption and mileage. Integrate fleet management software with the GHG accounting platform. Establish a process for collecting fuel card data, electricity invoices, refrigerant service records, and subcontractor freight data on a monthly or quarterly basis.
4. Select and validate emission factors: Choose primary emission factors for diesel, petrol, LNG, HVO, and electricity sourced from recognised databases. For subcontracted transport, use carrier-reported data where available or apply default freight emission factors from sources such as the GLEC Framework, which has been aligned with the GHG Protocol's Corporate Value Chain Standard.
5. Calculate and quality-check the inventory: Run initial calculations covering Scope 1 fuel combustion, Scope 2 electricity, and the most material Scope 3 categories. Perform sanity checks by comparing intensity metrics (kg CO2e per tonne-kilometre) against industry benchmarks. Investigate and explain any anomalies before finalising figures.
6. Set a base year and establish reduction targets: Select a representative historical base year and calculate the baseline inventory. Use this foundation to set science-based targets aligned with a 1.5°C pathway, as required by frameworks such as the SBTi FLAG or the SBTi Corporate Net-Zero Standard, which are increasingly referenced in customer contracts and investor questionnaires.
7. Engage the supply chain: Send data requests to key subcontracted carriers and logistics partners asking for their fuel consumption or carbon intensity figures. Where carrier data is unavailable, apply secondary emission factors and create an engagement roadmap to improve data quality over successive reporting cycles.
8. Report, disclose, and seek assurance: Publish the GHG inventory in the annual sustainability report or separate carbon disclosure. Submit data to CDP, complete the EU CSRD-mandated ESRS E1 disclosures if applicable, and engage an accredited third-party verifier to provide at minimum limited assurance over the reported figures.
9. Implement reduction measures and track progress: Translate the emissions inventory into an operational decarbonisation plan covering fleet electrification schedules, alternative fuel adoption (HVO, LNG, hydrogen), route optimisation, load factor improvements, and warehouse energy efficiency projects. Update the inventory annually and report progress against base year targets.

Frequently Asked Questions

Does the GHG Protocol apply to small and medium-sized logistics companies, or only large corporations?

The GHG Protocol is a voluntary standard and technically applies to any organisation that chooses to adopt it, regardless of size. However, practical pressure to comply is growing across the entire supply chain. Large shippers such as automotive manufacturers and retailers increasingly require carbon footprint data from their logistics providers as part of procurement criteria and ESG due diligence. Mid-market hauliers and 3PLs that cannot provide GHG-compliant emissions data risk being excluded from tender processes. The EU's CSRD also indirectly pulls SME logistics firms into reporting requirements, as large in-scope companies must collect Scope 3 data from their suppliers and service providers.

What is the difference between Scope 1, Scope 2, and Scope 3 emissions for a freight company?

For a road freight operator, Scope 1 covers all emissions from burning diesel or other fuels in vehicles and equipment that the company owns or directly controls — this is typically the largest and most measurable category. Scope 2 covers indirect emissions from buying electricity, for example to power warehouses, office buildings, or electric vehicle charging points. Scope 3 is a broad category covering all other indirect emissions in the value chain, including the carbon embodied in the fuel the company purchases before combustion (an upstream Scope 3 category), emissions from subcontracted carriers that the company does not own, emissions from employees commuting to depots, and the downstream carbon impact of delivering goods on behalf of customers. For asset-light logistics businesses that rely heavily on subcontractors, Scope 3 frequently represents over 90% of total reported emissions.

How does the GLEC Framework relate to the GHG Protocol in transport?

The Global Logistics Emissions Council (GLEC) Framework is a sector-specific methodology for calculating and reporting logistics emissions that has been formally aligned with the GHG Protocol's Corporate Value Chain (Scope 3) Standard. It provides standardised emission intensity values (in grams of CO2 equivalent per tonne-kilometre) for road, rail, sea, air, and inland waterway freight, making it the preferred tool for logistics companies filling in the transport-related categories of their GHG Protocol Scope 3 inventory. Using the GLEC Framework ensures that emissions from different transport modes are calculated on a consistent basis, facilitating comparisons and aggregation across complex multimodal supply chains.

How often does a transport company need to update and report its GHG inventory?

The GHG Protocol recommends annual reporting to enable consistent year-on-year comparison. Most regulatory and voluntary disclosure frameworks — including CSRD, CDP, and the SBTi — also operate on an annual cycle. In practice, logistics companies collect underlying data (fuel invoices, electricity bills, mileage records) on a monthly basis to support internal management reporting and flag operational inefficiencies in real time. The formal external disclosure is typically published within four to six months of the financial year-end, aligned with the annual report or sustainability report publication schedule.

Summary

The GHG Protocol provides transport and logistics companies with the rigorous, internationally recognised framework they need to understand, manage, and credibly communicate their full climate impact — from the diesel burned in owned trucks through to the carbon embedded in every subcontracted shipment. With regulatory requirements tightening, customers demanding verified emissions data, and investors scrutinising net-zero commitments, the question for logistics operators is no longer whether to implement GHG Protocol accounting, but how quickly and thoroughly to do so. Companies that build robust measurement infrastructure, engage their supply chains proactively, and publish independently assured emissions data today will be far better positioned to meet tomorrow's compliance requirements, win sustainability-conscious contracts, and lead the industry's transition to low-carbon freight.