Jul 22, 2025

Escape the Scope 3 spend-based data trap  

Sphera Editorial Team

As more companies accelerate greenhouse gas (GHG) emissions reporting and sustainability efforts, others are getting stalled by their own data.

In a recent survey of sustainability professionals, Sphera discovered that nearly 80% were reporting on Scopes 1, 2 and 3 – a 27-point increase over the previous year findings. That number could be higher if the right data were easier to collect and measure. 

However, many companies struggle to put their arms around the appropriate information, especially with complex Scope 3 emission data.  

If you’re reporting on all three, you already know that Scope 1 reporting involves direct emissions from sources owned or controlled by your company, such as company vehicles and facilities. Scope 2 covers indirect emissions from purchased energy and is tied to energy consumption. Both sets of data are readily available from internal resources and relatively easy to interpret. 

Scope 3 emissions data relates to the indirect emissions in your value chain, which can be far more challenging to collect, aggregate and measure. In the Sphera survey, 62% of respondents who report on Scope 3 cite internal data quality issues as a top challenge. Others struggle with supplier participation, with only 54% actively working together for better emissions insights.

Scope 3 is usually a company’s largest source of emissions. However, because much of this data originates from outside the company, downstream categories like processing and use of sold products are often underreported. Data availability and quality also present hurdles. In the Scope 3 survey, 79% of respondents identified problems in obtaining quality supplier data and internal data as a critical concern. 

To properly report Scope 3 emissions, companies must prioritize the quality and granularity of the data used to assess them. Outdated calculations or manual methods make it difficult to track progress, meet reduction targets and support credible disclosures.

It’s no surprise, then, that many sustainability leaders become frustrated by their data. 

The spend-based data trap 

Many sustainability experts rely on spend-based data, which determines carbon emissions by the amount of money their companies spend on goods and services. 

While readily available and the easiest entry point into Scope 3 reporting, spend-based data is also the least accurate way to measure your emissions. This can create a calculation trap that can overestimate your emissions. For example, goods may increase in price, while the emissions associated with their production may remain the same or even decrease.

This year, more companies have found an escape hatch in the form of a hybrid model that incorporates multiple data sources. In the survey, 65% of respondents reported using at least two types of data for their reporting – a 17-point increase over our 2024 report.  

Last year, 30% of respondents reported using exclusively spend-based data for their Scope 3 reporting. This year, that number dropped to 15%.

Other data methods to consider

Two other common emissions calculation methods are life-cycle assessment (LCA) and supplier-specific product carbon footprints (PCFs). LCA, or mass-based data, provides a more nuanced view for companies that are further along in their reporting maturity. This method aligns with ISO 14044 standards to provide emissions insights from raw material extraction through production and use phases. However, LCA relies on quality source data and centralized software to collect and process it.

PCFs are the gold standard for Scope 3 data, delivering the highest accuracy but also requiring substantial participation by suppliers and system maturity. However, recent technological developments and a maturing supplier base are making this approach more feasible than ever.

Deciding which method to use and how to collect and measure Scope 3 emissions can still be a complex process. Many companies claim Scope 3 reporting is hindered by a lack of data from suppliers, customers, partners and even internal sources. 

Tips for Scope 3 newcomers 

For newcomers or those looking to incorporate Scope 3 into existing disclosures, gathering and calculating such a wide range of emissions factors can feel daunting. These tips can help you build an infrastructure that yields valuable and strategic insight.  

Start small and strategically leverage existing Scope 1 and 2 structures to integrate Scope 3 thinking.

Identify high-impact categories and map available data sources to inform your analysis.

Apply the 80/20 rule: Prioritize supplier engagement with the roughly 20% of suppliers that likely account for approximately 80% of your Category 1 emissions.

Align internal stakeholders across sustainability, finance and procurement. All of these functions will benefit from your insights.

Adopt flexible tools that can grow with your reporting maturity.

Measuring Scope 3 emissions requires broad supply chain visibility. This aligns with an increased focus on upstream activities and due diligence for impact areas like deforestation and human rights.

Acting now not only mitigates future compliance risk but also strengthens investor confidence, anticipates customer pressure, improves supply chain resilience and lays the groundwork for long-term sustainability success.

The Sphera 2025 Scope 3 Emissions Report provides a deeper dive into the latest trends in emissions reporting. You can also tune into our ongoing Scope 3 Summer Webinar series for more insights. 