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Are Apples Being Compared to Oranges in CO₂ Reporting? New Study Enhances the Comparability of Corporate Carbon Performance

Prof. Dr. David Bendig (l.), Dr. Colin Schulz (m.-l.), and Dr. Florent Erbar (m.-r.) from the Institute for Entrepreneurship at the University of Münster with Dr. Tim Heubeck from the University of Bayreuth (r.) from the Chair of International Management

As businesses worldwide work to address climate change, it has become increasingly important to measure how much carbon they produce. Despite its importance, there are inconsistencies in how corporate carbon performance is defined and measured. A new study by Prof. Dr. David Bendig, Dr. Colin Schulz, and Dr. Florent Erbar from the University of Münster, and Dr. Tim Heubeck from the University of Bayreuth, titled "Apples to Apples: Accurately Assessing Corporate Carbon Performance," published in the Journal of Cleaner Production, introduces a framework aimed at standardizing corporate carbon performance assessment.

The study introduces a definition of corporate carbon performance, distinguishing between carbon usage, carbon intensity, and assessment metrics. Additionally, the study presents a methodology to assess how well companies align with global climate targets. This approach links firm-level actions with global emission reduction goals. Finally, the study evaluates the quality of greenhouse gas (GHG) data, showing that verified data is more accurate than self-reported or estimated data.

These findings have significant implications for researchers, firms, investors, and regulators. They are encouraged to use multiple metrics to capture a comprehensive view of corporate carbon performance, should set clear carbon reduction targets, ensure transparency in reporting, and seek verification to improve data accuracy. Regulators may consider mandating reporting and verification to enhance data quality and support global climate targets.

For further details, the full study is accessible here.