How Australian companies can prepare for Scope 3 carbon reporting

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Peter Philipp, Neo4j ANZ General Manager

Peter Philipp, General Manager ANZ, Neo4j

The race is on for companies and countries to achieve net zero by 2050. In Australia, the government and private sector are redoubling their efforts to develop and adopt low-carbon solutions and policies as they pursue green growth opportunities to address environmental and social corporate governance (ESG) issues.

Scope 3 reporting represents a key battleground in the fight against carbon emissions. It includes indirect emissions across a company’s entire value chain globally, such as the extraction and production of purchased materials, transportation and distribution, and waste generation. Because Scope 3 carbon reporting includes the emissions of partner companies, it can be very challenging to control or even monitor. 

Although Scope 3 emissions reporting is not mandatory in Australia, many organisations are preparing for the standard to improve their business performance. Carbon reporting has also piqued the interest of investors, with many now closely examining the impact of climate change on companies as they establish targeted strategies to reduce carbon emissions. 

Leveraging data for sustainability

There is enormous scope for Australian companies to put climate action at the heart of their strategy by deploying the right technology to create value for their businesses and protect the planet. 

This is where graph technology can be a powerful tool for companies to accelerate their carbon-neutral ambitions. Since visualisation capabilities are already built into graph databases, Australian companies can analyse massive amounts of data, interconnect the relationships between data points and ensure accurate reporting while reducing costs and lowering their carbon footprint. Graph technology enables firms to incorporate sustainability into their organisational design, boosting data transparency and business reputation. 

Once businesses collect all their data through remote sensing and other methods, they can quickly identify and fix environmental problems highlighted in the system by region, site, or equipment.

Many leading organisations are also building digital twins of their value chain, backed by a modern native graph database that can scale easily. Graph-based digital twins connect emissions that would be difficult, or even impossible, to do in non-graph systems. This provides a comprehensive digital view of the business, and because graph databases are flexible, it is easy to add additional output data, like emissions and environmental compliance, once a set of processes is linked together.

Companies can begin with a simple use case and then embed more data and applications as their adoption matures and GHG estimation methodologies improve. 

Securing the future

With a pledge to achieve net zero by 2050, there is an urgency for Australia to unlock a new energy economy in the national interest. Organisations will be under intense scrutiny and pressure from shareholders to report on sustainability. 

Whether sourcing raw materials or manufacturing and distribution, businesses will need to examine billions of data points along the way. It is impossible to do this using conventional database management systems. Technologies like graph databases, on the other hand, can be used to provide answers that are tricky for legacy systems. 

With tighter sustainability metrics, businesses can make smarter decisions that lead to less risk and more financial gain. Complying with environmental regulations means smoother operations and a better reputation – making it a win-win for everyone.

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