The future of Scope 3: understanding the proposed Category 16
For more than a decade, the GHG Protocol Corporate Value Chain (Scope 3) Standard has helped organisations measure and report emissions across their value chains through 15 well-defined categories. These categories have become the global benchmark for carbon accounting, enabling businesses to identify emission hotspots and make informed decisions to support their decarbonization journey.
However, as business models continue to evolve, so do the challenges of carbon reporting. The rise of digital platforms, financial services, licensing arrangements and other complex commercial relationships has created activities that are not always clearly captured within the existing Scope 3 framework.
To address these emerging challenges, the GHG Protocol is currently reviewing its Scope 3 Standard. As part of this revision process, it has proposed a new reporting category, commonly referred to as Category 16. While this proposal is still under consultation and has not yet been incorporated into the official Scope 3 Standard, it offers valuable insight into the future direction of carbon accounting.
Why has Category 16 been proposed?
When the Scope 3 Standard was first introduced, most organisations operated through relatively traditional business models. Today, many companies create value by enabling transactions, providing digital services, licensing intellectual property or facilitating activities rather than directly manufacturing products or operating physical assets.
As a result, certain emissions associated with these business models can be difficult to classify under the existing 15 Scope 3 categories. The proposed Category 16 aims to improve consistency by providing guidance for reporting these types of value chain activities.
What could Category 16 include?
Although the proposal is still being refined, the GHG Protocol has indicated that Category 16 may help organizations account for emissions associated with:
• Certain facilitated emissions linked to platform-based business models.
• Selected financial and insurance activities that are not fully addressed under the current framework.
• Other emerging value chain activities that require additional reporting guidance.
The final scope and reporting requirements will only be confirmed once the revised Scope 3 Standard is published.
Why does this matter?
The proposal reflects an important shift in sustainability reporting. Increasingly, stakeholders want businesses to understand not only the emissions they generate directly, but also the broader climate impacts created through their commercial relationships and business activities.
Providing clearer guidance for these emissions can improve reporting consistency, strengthen transparency, and help organisations better understand their overall climate impact.
For businesses operating in rapidly evolving sectors, this could lead to more comprehensive and meaningful carbon disclosures in the future.
What should organizations do today?
For now, organizations should continue reporting in accordance with the current GHG Protocol Scope 3 Standard, which officially consists of 15 reporting categories.
At the same time, sustainability professionals should stay informed about the ongoing revision process. Businesses with complex value chains, platform-based business models or significant financial activities may benefit from understanding how future updates could influence their reporting practices.
Being prepared today will make the transition easier if and when the revised standard is adopted.
The strategic perspective
Carbon accounting is constantly evolving to reflect the changing nature of business. The proposed Category 16 is not about replacing the existing framework, but about ensuring that emerging business models are represented more consistently within carbon reporting.
While it remains a proposal, it signals the direction in which sustainability reporting is heading—towards greater transparency, improved comparability, and a more complete understanding of emissions across the value chain.
As reporting expectations continue to grow, organisations that stay informed and adapt early will be better positioned to build credible ESG strategies and demonstrate meaningful climate leadership.
Note: Category 16 is currently a proposed addition being considered as part of the GHG Protocol’s ongoing revision of the Scope 3 Standard. At the time of writing in August 2026, the official GHG Protocol continues to recognize 15 Scope 3 categories, and organizations should continue reporting in accordance with the current standard until any revisions are formally adopted.
