Carbon accounting or greenhouse gas accounting is the process for measuring the amount of carbon dioxide equivalents an organization emits. It is used by states, corporations, and individuals to track their carbon footprint but to also manage the carbon credit commodity traded on carbon markets.

With this in mind, in this Green Business Bureau article, we get into the details of carbon accounting and explain how a business’s carbon footprint is calculated. We explain the impact of human-induced carbon on climate change and how humanity’s influence on our climate can be managed with a carbon accounting framework.


The carbon disclosure project (CDP) is an independent, non-profit organization that holds the largest database in the world of primary information regarding a company’s carbon footprint, and carbon-reduction strategies.

Since its formation, the response rate of companies reporting their carbon footprint to CDP has steadily increased. In 2020, more than 9,600 companies with (more than) 50% of the global market capitalization disclosed carbon footprint data through CDP.

There’s a global trend indicating a strong desire among stakeholders for businesses to reveal their carbon footprint data. Doing so gives the transparency our world needs to mitigate the effects of climate change.


Carbon accounting describes a process that measures, records, and reports greenhouse gas  (GHG) emissions. It’s a relatively new discipline born from the collective awareness that carbon dioxide emissions are impacting our climate. 

Yet it wasn’t until 1992, with the adoption of the United Nations Framework Convention on Change (UNFCCC) during the Rio de Janeiro Earth Summit, that a global movement to inventory GHG emissions, and with that, carbon accounting, began.

To understand the importance of carbon accounting and why it’s needed, you must understand how humans are impacting Earth’s climatic system.


The greenhouse gas effect is a natural phenomenon that keeps Earth’s temperature around 59°F (15°C). This temperature allows life to exist on Earth and creates relatively stable weather patterns.

This greenhouse gas effect is caused by the influence of GHGs on our planet’s heat balance, as we explain below: 

  • Our planet receives energy from the sun, which is partially absorbed by Earth’s surface. The remainder of that energy is then reflected into space. 
  • Later, the absorbed energy is re-emitted into the atmosphere as infrared radiation (IR).
  • Some of this IR is absorbed by particular gasses in our atmosphere which we name GHGs. The most common GHGs in our atmosphere are water vapor (H2O), carbon dioxide (CO2), and ozone (O3). 
  • By absorbing IR, GHGs trap energy between the earth’s atmosphere and surface, keeping the overall temperature of our planet stable and suitable for life. 

The role of GHGs can be compared to that of a greenhouse. Sunlight penetrates the atmosphere and GHGs, like glass, ensure that some of that energy stays in.

The scientific term to describe the influence of GHGs on Earth’s heat balance is radiative forcing. Radiative forcing illustrates the difference between the energy received and the energy emitted by a given climatic system. A positive radiative forcing will heat a system (more energy is received than is emitted), and a negative radiative forcing will cool down a system (more energy is lost than is received). 

Global warming exemplifies positive radiative forcing in action. And this has been linked mainly to an increase in atmospheric carbon dioxide CO2, but also methane (CH4) and nitrous oxide (N20). 


The first signs of human-attributed global warming were identified in 1896 by chemist Svante Arrhenius. Arrhenius observed that atmospheric CO2 had increased since the start of the industrial revolution, which is marked by the discovery and exploitation of fossil fuels. 

Since this revolution, fossil fuel reserves (coal, oil, and gas) are burnt for energy to feed the beast of human production and finance exponential economic growth. Yet this black gold has a sinister side.

Fossil fuels are a product of Earth’s carefully balanced elemental cycles. Burning coal, oil, and gas disrupts these cycles and releases GHGs. To explain, we’ll take a look at the most significant cycle relevant to human-induced warming. The carbon cycle.

It must be noted that similar principles apply – regarding elemental cycling – to other GHGs associated with human-attributed warming – such as methane (CH4) and nitrous oxide (N20) (the nitrogen cycle).


We owe the stability of our climate, in part, to the carbon cycle. And this is the cycle humans have manipulated the most. The steps of the carbon cycle are detailed below:

  • Carbon-containing CO2 is drawn from the atmosphere by plants and is assimilated by plants for growth.
  • These plants die, and in time, are buried under Earth’s surface. This dead vegetation still holds the carbon that was once locked in. 
  • Over millions of years, this carbon is slowly released back into the atmosphere through processes such as weathering. 
  • The process repeats, and over millions of years, carbon is continuously cycled between our atmosphere and organic matter.

The carbon cycle balances the amount of carbon in our atmosphere. Because CO2 is a GHG, this cycle also works to stabilize Earth’s temperature.

Coal, oil, and gas are forms of fossilized vegetation – plants that once locked in atmospheric carbon. Burning these fossil fuels releases this carbon back into our atmosphere at an unprecedented rate and faster than it can be reabsorbed. We’re the first to disrupt the carbon cycle in this way, meaning we’re entering unknown territory.

Coming back to the Swedish scientist, Arrhenius, his studies concluded: If the consumption of fossil fuels by humans continues, then the concentration of carbon in our atmosphere would increase, heightening the earth’s average temperature.


The Intergovernmental Panel on Climate Change (IPCC) was established in 1988 by the World Meteorological Organization (WMO) and the United Nations Environment Programme (UNEP) at the behest of the G7.

The role of the IPCC is to: 

“Assess the scientific, technical and socio-economic information relevant for understanding the risk of human-induced climate change.” 

IPCC is a body that assesses and coordinates research into climate change occurring across the world. 

In 1990, the IPCC published its first assessment report (FAR), which confirmed climate change is a threat to human life and stability. The IPCC estimates that the concentration of CO2 in our atmosphere has increased from 280 parts per million (ppm) – during the pre-industrial era – to 412.5 ppm in 2020. Such a rise has not been seen in the last 650,000 years, and never before has atmospheric CO2 increased as rapidly.

This increase in atmospheric carbon dioxide is associated – as predicted – with an average temperature rise. Yes, the Earth’s average temperature naturally oscillates. What’s different this time is humans are interfering with this natural rhythm and pushing it out of sync. For instance, our planet is currently heating up, when over the past 7,000 years, the average temperature has been decreasing at a baseline rate of 0.01°C per century.

Our unnatural interference with Earth’s elemental cycles (e.g. carbon and nitrogen) is causing unnatural temperature cycles across the globe, pushing us rapidly into the unknown. We’re witnessing more freak weather events, from droughts and storms, meaning the future consequences of our actions don’t bode well.

The most recent IPCC report, published on Monday 28th February 2022, paints the bleakest picture yet regarding the impacts of climate change risk on ecosystems, wildlife, human health, society, and our economy. The report confirms that the widespread impact of global warming is being felt around the world. Once more, further impacts are in the pipeline even if emissions are cut to meet the most ambitious scenario targets. 

We also conclude that many future climate-related risks are more severe than previous IPCC assessments, increasing the urgency of cutting greenhouse gas emissions to limit future warming to as low as possible.” – Professor Richard Betts MBE, Met Office, and the University of Exeter and report lead author


Climate change has impacted and will continue to impact physical systems, biodiversity, and the way our societies are organized. To illustrate how climate change will impact different ecosystems, we’ve detailed some of the changes to expect below. These changes will occur if fossil fuel use continues as it is today.

  • The IPCC estimates that sea levels will rise between 26 and 82 cm during the period from 1986-2005 to 2081-2100. This rise threatens coastal areas and territories that lack the financial support to build the infrastructure needed to combat these changes. 
  • During the decade 2030-2040, the arctic will become an ice-free zone. Removing the ice cap will mean less of the sun’s energy is reflected out into space, which will increase the rate of global warming. 
  • By 2040, great expanses of permafrost are expected to thaw, releasing methane. Methane is far more potent than carbon dioxide and will accelerate the rate of climate change.
  • Our oceans will continue to heat and become more acidic, killing coral reefs, which are expected to become extinct by 2050, along with a collapsing fish population.
  • The weather will become increasingly extreme and unpredictable by 2018
  • By 2100, our planet will become 39.2°F (4°C) warmer making large parts of Earth uninhabitable.
  • A sixth mass extinction event is happening today, partly caused by climate change. Many of our planet’s species, on which we rely, will vanish.


On the 9th of May, 1992, the United Nations Framework Convention on Change (UNFCCC) was adopted. In the same year, the framework came into force after being ratified by 50 states during the Rio de Janeiro Earth Summit held on the 4th of June. 

The objective of the convention was to: 

“Stabilize greenhouse gas concentrations in the atmosphere at a level that would prevent dangerous anthropogenic interference with the climatic system.” – UNFCCC, What is the United Nations Framework on Climate Change?

Although this level was not defined by the convention, the aim was to allow ecosystems and society to adapt naturally to climate change, which means slowing global warming down. Since the convention’s establishment, the countries involved meet annually during the Conference of the Parties (COP). COP is a supreme decision-making body that aims to promote the effective application of the convention. 

30 years on from the establishment of the convention came COP 26 (2021), which was held in Glasgow. COP26 brought together 120 world leaders and over 40,000 registered participants. Countries involved include the US, the UK, the European Union, and China. One of the main agreements made from COP26 was the commitment to end and reverse deforestation, along with securing global net-zero by the mid-century and keeping 34.7°F (1.5°C) within reach.

The ongoing commitment towards COP – since 1992 – symbolizes how the political recognition of climate change has increased globally. There have been two significant events worth noting since the establishment of COP:

  1. The Kyoto Protocol: The first meeting from the Conference of the Parties (COP1) took place in 1995 in Berlin. COP1 launched strict and precise commitments to mitigate climate change in what was named the Kyoto Protocol. The protocol sets binding and measurable objectives for combating climate change for the first time, stipulating global ceilings for GHGs. 
  2. The Paris Climate Agreement: COP21 took place in Paris 2015, and marked a new momentum for climate action. During COP21 leaders worldwide signed the Paris Agreement, which has the central aim of strengthening the global response to the threat of climate change. The Paris Agreement outlined the action necessary to limit global temperature rise this century below 35.6°F (2°C) (which is warmer than pre-industrial levels), and to limit further temperature increases to 34.7°F (1.5°C). The Paris Climate Agreement opened for signature on Earth Day (22nd of April 2016), at the UN headquarters in New York. 192 states and the EU – representing 98% of global GHG emissions – have ratified or acceded to the agreement. This includes China and the US (with president Biden’s remittance after Donald Trump’s previous withdrawal).


As a trusted authority to green business, the Green Business Bureau provides online solutions to help purpose-driven organizations of all sizes manage their environmental impact. 

When you sign up for GBB, you’ll conduct an EcoAssessment which will help you institute initiatives to understand what actions you can take to become more sustainable. You can then use these initiatives to support your sustainability program and reporting by identifying where your carbon and greenhouse gas emissions are coming from. As you work through GBB’s EcoAssessment and carbon-friendly targets, you’ll drive carbon footprint reductions in your business, supporting the green economy of today and our future.

About the Author

Jane Courtnell

With a Biology degree from Imperial College London and further studies at Imperial College’s Business School, Jane Courtnell has an enthusiasm for science communication and how biology can be used to solve business issues, such as employee wellbeing, culture, and business sustainability.

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