How can companies reduce their carbon footprint: a practical guide

As a company, you may be asking: how can companies reduce their carbon footprint? 

Tackling this question matters. From Scope 1 and 2 emissions in your operations, to Scope 3 emissions across supply chains, each step offers powerful opportunities to cut greenhouse gas emissions, comply with regulations, and boost competitiveness.

In this guide, we walk you through a structured, step‑by‑step approach. We begin with how to measure your baseline emissions, then set science‑based targets and implement a climate transition action plan. You’ll learn how to boost energy efficiency, switch to renewable energy, adopt sustainable procurement, reduce travel emissions, and embrace circular economy practices. We’ll also cover how to engage employees, secure financing, and monitor progress over time.

By the end, you’ll have a clear roadmap to reduce your carbon footprint and accelerate your decarbonisation journey.

1. Start by calculating your carbon footprint

Understanding how companies reduce their carbon footprint begins with calculating their carbon footprint. You need to measure emissions across:

• Scope 1 – direct emissions from owned or controlled sources such as boilers, furnaces, and company vehicles.
• Scope 2 – indirect emissions from purchased electricity, heat, or steam.
• Scope 3 – all other indirect emissions along your value chain, including supplier operations, distribution, product use, and waste.

Adopt a structured carbon accounting method, such as the GHG Protocol. Use a carbon management software to centralise data from invoices, utility bills, and supplier questionnaires. If data is incomplete, use conservative estimates and improve over time.

Baselining your operations allows you to track progress and benchmark against peers. Scope 3 can account for up to 90% of total emissions in many companies—meaning supplier engagement and procurement changes are essential.

2. Set science‑based targets

Once you have a baseline, set science‑based targets that align with limiting global warming to 1.5 °C. These should be specific, measurable, achievable, relevant, and time‑bound (SMART):

• Define interim milestones (e.g. 50% reduction by 2030, net‑zero by 2050).
• Develop a climate transition action plan that outlines each measure, assigns responsibility, and sets deadlines.
• Integrate progress tracking into your management dashboards to maintain accountability.

Targets are most effective when linked to decision‑making at every level, from procurement to HR policy.

3. Energy efficiency and building management

Upgrading facilities can deliver immediate carbon and cost reductions.

• Improve insulation and glazing to minimise heat loss in winter and heat gain in summer.
• Switch to LED lighting with smart controls to reduce unnecessary energy use.
• Optimise HVAC systems with regular maintenance, zoned heating/cooling, and automated controls.
• Install energy monitoring systems to identify inefficiencies in real time.

Energy efficiency measures often have a payback period of 2–5 years and reduce emissions and utility bills.

4. Switching to renewable energy

Transitioning to renewable energy can drastically reduce Scope 2 emissions.

• Choose certified green electricity tariffs from local suppliers.
• Sign corporate Power Purchase Agreements (PPAs) to lock in renewable energy at predictable prices.
• Install rooftop solar panels if you own your building, or join community solar schemes if you lease.
• Purchase Renewable Energy Guarantees of Origin (REGOs) or Guarantees of Origin (GOs) to certify the source.

When possible, align contract terms with your target dates to ensure long‑term decarbonisation consistency.

5. Sustainable mobility and travel policies

Transport policies can cut a significant portion of operational emissions.

• Ban flights for trips under 3 hours and require train travel instead. This reduces emissions per journey by up to 90%.
• Provide public transport subsidies and safe bike parking to encourage low‑carbon commuting.
• Replace company cars with electric or hybrid models, and install charging infrastructure at workplaces.
• Implement video‑conferencing as the default for inter‑office meetings.

These measures reduce emissions, cut costs, and improve employee well‑being.

6. Sustainable supply chain and procurement

Engaging suppliers is essential for Scope 3 reductions.

• Include environmental performance criteria in procurement policies and supplier contracts.
• Request annual emissions data from suppliers, and offer them tools or training to improve accuracy.
• Prioritise suppliers that use renewable energy or have their science‑based targets.
• Collaborate with suppliers on joint efficiency or product redesign projects to reduce embedded emissions.

This fosters shared responsibility and builds stronger, more sustainable business relationships.

7. Circular economy and waste minimisation

Circular economy principles minimise emissions from material use and waste.

• Redesign products and packaging to use less material and allow for easier recycling.
• Establish systems for reusing components or refurbishing returned products.
• Separate waste streams on‑site and partner with recyclers to ensure materials are processed responsibly.
• Train staff to identify waste reduction opportunities in daily operations.

Reducing waste at source is usually more cost‑effective than managing waste after it’s created.

8. Digital solutions and IT

IT operations can consume more energy than expected—especially with increased cloud usage.

• Move workloads to cloud providers that run on renewable energy and have energy‑efficient infrastructure.
• Consolidate and decommission unused servers or devices.
• Enable automatic power‑down settings for all company devices.
• Promote remote work to reduce commuting, ensuring employees have energy‑efficient home office setups.

Even small IT changes can yield measurable carbon and cost savings at scale.

9. Employee engagement and internal governance

Behavioural change is critical to long‑term success.

• Provide sustainability training for all staff, tailored to their roles.
• Create “green teams” to lead initiatives and collect improvement ideas.
• Recognise achievements publicly and link sustainability KPIs to performance reviews.
• Maintain open communication on progress and challenges through regular updates.

A workforce that understands and supports sustainability goals is more likely to innovate and maintain momentum.

10. Monitoring, reporting and assurance

Regular monitoring ensures progress stays on track.

• Use carbon management software for real‑time emissions tracking.
• Publish annual sustainability reports aligned with recognised frameworks like CDP, EU CSRD, or UK SECR.
• Conducted quarterly internal reviews and adjusted strategies as needed.
• Obtain third‑party assurance to verify your emissions data and build credibility with stakeholders.

Transparency builds trust with customers, investors, and regulators.

Carbon contributions: pros, cons, and when to use them

Even after maximising internal reductions, most companies will have some unavoidable emissions—at least in the short term. Carbon contributions (often called carbon compensations or offsets) involve funding external projects that remove or avoid greenhouse gas emissions, such as renewable energy installations or reforestation.

Pros:

• Allow companies to address residual emissions while long‑term reduction measures mature.
• Support environmental and social co‑benefits beyond carbon (e.g. biodiversity, community development).
• Demonstrate commitment to climate action when paired with substantial internal reductions.

Cons:

• Risk of being perceived as “greenwashing” if used instead of direct reductions.
• Quality varies; some projects have questionable additionality or permanence.
• Prices may increase as demand rises and the supply of high‑integrity projects tightens.

When to use:
Carbon contributions should only be used for residual emissions that cannot yet be eliminated, and always in parallel with a robust reduction strategy. Prioritise high‑quality, certified projects that are transparent about impact and monitored over the long term. Contributions are not a substitute for decarbonisation but a complementary step in a credible climate strategy.

Quick takeaways

• measure Scope 1, 2 and 3 emissions to identify priorities
• set science‑based targets with a clear action plan
• improve energy efficiency and switch to renewables
• adopt sustainable travel policies and electrify fleets
• engage suppliers to reduce Scope 3 emissions
• apply circular economy and waste‑minimisation principles
• use digital solutions for efficiency and reporting
• involve employees and embed sustainability in governance
• secure funding to accelerate implementation
• use carbon contributions only for unavoidable residual emissions

Conclusion

Reducing a company’s carbon footprint is essential and achievable with a structured approach. For businesses in Belgium, France, the Netherlands, Luxembourg, and the UK, the journey starts with measuring Scope 1, Scope 2, and Scope 3 emissions. From there, science‑based targets will be set, and a Climate Transition Action Plan will be developed to embed decarbonisation into every department.

Focus on quick wins—energy efficiency upgrades, renewable energy sourcing, and sustainable mobility policies—while building long‑term capacity in supply chain engagement, circular economy practices, and green IT. Keep employees involved, secure funding to scale your projects, and track progress with robust reporting systems.

When unavoidable emissions remain, consider high‑quality carbon contributions as a short‑term complement to your reduction efforts. This balanced approach delivers measurable environmental benefits, ensures regulatory compliance, and strengthens stakeholder trust—helping your business thrive in a low‑carbon economy.