Your bank has a carbon number for your business. Here is where it came from, and how to replace it with yours

If your business bank has started showing you a carbon footprint, or your lender has asked about emissions for the first time, the number they are working from almost certainly is not yours. It is your sector's, with your turnover or your spending attached. Here is how it was produced, why it matters, and how to put your own figure in its place.

How a bank estimates the emissions of a business

By multiplying money by an average. The two common methods are the same idea at different grains. A transaction-based estimate multiplies each payment you make by an average emissions factor for that spending category in your country. A revenue-based estimate multiplies your annual turnover by an average emissions intensity for your sector. Both factors come from national economic models that spread a whole sector's emissions across its output, so a haulage firm, a printer or a food manufacturer each gets the intensity of its industry as a whole.

Neither method looks at your business. They cannot: the only inputs are your spending or your revenue and a sector code. Under the PCAF standard banks use for lending portfolios, a figure produced this way sits at data quality score 4 or 5, the two lowest of five, and the bank is required to disclose that.

What the estimate cannot see

Anything you have actually done. If you moved to a renewable electricity tariff, replaced diesel vans, changed a supplier or cut waste, the estimate does not move, because none of that appears in a payment feed or a turnover figure. The only thing that lowers a sector-average estimate is spending or earning less. A competitor in the same sector that has done none of that work carries the same number you do.

That is why the number matters even if you have never been asked for one. It is the figure a lender will use when it looks at your sector exposure, prices a sustainability-linked facility or decides which customers to engage. It is very often the same figure a large customer's procurement team is using for you in its own Scope 3 reporting, produced the same way from your invoices. And it will follow you into every portfolio and every supply chain you appear in until something replaces it.

What replaces it

A figure of your own. Under the GHG Protocol, an emissions figure that comes from your business rather than from a sector average is primary data, and it does not have to be elaborate to count. A Scope 1 and 2 inventory built from your fuel and electricity bills is a real number. A carbon footprint for a product or service you sell is a real number. If you have published either, in your annual report, a sustainability statement or a response to a customer, the figure already exists; the bank simply has not found it.

Many businesses have done this work for one customer and never used it again. The same inventory that answered a procurement questionnaire last year is the one that replaces your bank's estimate, and the one that answers the next customer.

Put it where every bank and buyer will read it

On a profile you own. DitchCarbon holds verified emissions data for over 2 million organisations, built on primary emissions data wherever it exists, and your business is very likely already on it, with whatever you have published, or a sector-based estimate if you have not. Claiming your profile is free. Once claimed, your published figure is what any bank or buyer that looks you up on DitchCarbon sees first, with the document behind it, and the method shown as your own reported data rather than an industry average.

Two things save the most time afterwards. Context answers let you answer a question once, on your profile, and any logged-in viewer from another organisation reads the same answer, so the fifteenth version of the same form does not need filling in. The survey responder takes a customer's emissions questionnaire, forwarded by email or uploaded, into a tracked queue answered from your profile data.

You are on both sides of this

Most businesses being measured by a bank are also measuring, or about to be. Your customers' procurement teams want your figure; your own suppliers' figures are what make up most of yours. The same profile that carries your inventory to your lender is the one your suppliers see when you ask them, and their published figures are already on the same platform, so the number you hand to your bank can be built on your suppliers' own data rather than on another set of sector averages.

A business that has claimed its profile is measured on what it has done rather than on what its sector does on average, by every bank and buyer that asks, from one answer it gave once.