Sustainability reporting can be a MASSIV+ task
Sandvik has joined forces with Microsoft and other companies to alleviate the challenging process of greenhouse gas emission data reporting. It’s a project that could revolutionize sustainability reporting.
Sustainability reporting is getting increasingly complicated for companies as the demands for compliance increase. It is particularly demanding for the nearly 50,000 companies who must now comply with the Corporate Sustainability Reporting Directive(CSRD) and connected European Sustainability Reporting Standards (ESRS).
Collaborative efforts to simplify sustainability reporting
In response to this, Microsoft and Volvo Cars initiated a meeting in 2022 with Sandvik and Alfa Laval to create a cross-industry partnership to alleviate some of the challenges. Other global companies, including SKF and IKEA were invited to join. The result was MASSIV+, named after these companies.
“Our first meeting was at Microsoft’s office in Stockholm to discuss the challenges with sustainability data in general and how to get reliable data along the value chain. This is a common issue for all companies, and we have no problem collaborating and sharing data,” says Head of Sustainability at Sandvik, Mats Lundberg.
The goal of MASSIV+ is to have a systematic and simplified process when it comes to collecting and validating greenhouse gas emissions data. More specifically, it will address the collection of data coming from scopes 1 and 2, to secure scope 3 sustainability data.
Scope 3 emissions often account for a large portion of a company’s carbon footprint but since they come from supplier or customer activities, they are more difficult to measure. The manufacturing industry in particular has complex supply chains with numerous suppliers and traceability can be a challenge.
The benefits of centralized data sharing
Today, it can take months to get an accurate scope 3 calculation, says Lundberg, but if companies were to share data connected by blockchain intelligence, an accurate calculation could be accessed simply by clicking a button. “Doing it this way would increase accuracy and speed in the process,” he says.
“Sharing data in a centralized way means we can build on one another’s data and spend less manual effort individually in trying to gather data from suppliers,” says Microsoft’s Caroline Atelius, Manufacturing and Automotive Lead, Sweden, adding that many companies have been spending a lot of time and effort on solving the same things.
“This group is showcasing their willingness and investment in time and effort to make it work,” she says. “Sandvik has been working with sustainability for quite a few years and is contributing with learnings from its own journey. Sandvik is very invested in bringing the right people into the conversation to get the right conclusions.”
Enhancing reporting with shared data
Microsoft’s R&D and engineering functions are contributing with technical knowledge on data sharing and financial support. A proof of concept test will be performed before the end of the year. The MASSIV+ efforts could be beneficial for other sectors too as sustainability reporting affects all global companies, says Lundberg.
“If big companies provide their data, you could, for example, calculate CO2 emissions related to an investment fund or stock portfolio and do it in the blink of an eye. We could address climate change and the problems based on more accurate data and would know where the hot spots are. It will be easier to select better supply chains or product providers when we can identify more transparently where emissions come from.”
Introducing the scopes
Greenhouse gas emissions are divided into “scopes” for businesses and organizations. To meet internationally agreed targets on global warming, companies need to cut emissions acrossscopes 1–3.
- Scope 1 emissions are direct emissions that a company causes such as in the running of its machinery for manufacturing.
- Scope 2 refers to indirect emissions (not produced by the company itself) from purchasing energy, for example electricity, steam, heat or cooling from a utility company.
- Scope 3 refers to indirect emissions that result from activities not owned or controlled by the reporting organization. Scope 3 emissions include many categories of both upstream (for example purchased goods have a carbon footprint) and downstream emissions (for example, use of sold products such as diesel-powered equipment).
Scope 3 emissions account for the largest portion of the climate impact from Sandvik by far. To improve scope 3 calculations, Sandvik and some other global companies have initiated a joint project that could revolutionize sustainability reporting.