Small and Medium-Sized Enterprises Climate Accounting Made Easy

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Abstract
The European Union’s decarbonization strategy relies on transparent and accurate climate data across value chains. Yet, existing sustainability reporting frameworks mainly target large companies, often neglecting small and medium-sized enterprises (SMEs). Although SMEs are largely exempt from mandatory reporting under recent regulatory simplifications, they play a critical role in Scope 3 emissions, which dominate the carbon footprints of larger firms. This paper presents two complementary, freely accessible digital tools designed to support credible carbon accounting. The first tool, Climate Compass, is a government-sanctioned tool that aligns with the GHG Protocol and has been used by >10,000 SMEs in Denmark to calculate Scopes 1, 2, and 3 emissions through a user-friendly interface. The second, a newly developed online cradle-to-gate life cycle assessment (LCA) tool, supports product-level carbon footprinting using open-source emission factor databases. The cradle-to-gate approach reflects typical SME production profiles and emphasizes embodied CO2e from raw materials, transport, and energy consumption. Together, these tools enable researchers to effectively assess SMEs emissions in the value chain and thus support decarbonization while supplying reliable data to larger companies. The tool democratizes emissions analysis and supports regulatory and market demands and strengthens SMEs contribution to Europe’s low-carbon transition.
Funding Information
  • Danish Industry Foundation

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