Carbon Accounting

Carbon Footprint of Product (CFP) refers to the total greenhouse gas (GHG) emissions associated with a product throughout its life cycle, typically expressed in carbon dioxide equivalent (CO₂e).

By conducting a product carbon footprint assessment, you can accurately quantify life-cycle GHG emissions, identify major emission sources, and optimize decarbonization measures and supplier management accordingly.

In the production process, despite implementing a series of emission reduction measures (such as using green electricity, improving energy efficiency, etc.) to reduce the Carbon Footprint of Product(CFP), there will still be unavoidable carbon emissions.

Offsetting this portion of carbon emissions through the purchase of carbon credits allows the product to become carbon neutral.

Corporate GHG inventory refers to the process of calculating the direct and indirect greenhouse gas emissions generated by various stages of an enterprise's social or production activities. It is also known as “compiling a greenhouse gas emissions inventory”.

GHG inventory is the foundation and basis for enterprises to set scientific carbon targets and implement carbon reduction measures. With a clear understanding of their carbon footprint, companies can set science-based targets (such as SBTi), implement carbon emission reduction, assess carbon performance, and thereby achieve dual carbon goals.

According to the GHG Protocol, corporate carbon emissions can be categorized into direct emissions (Scope 1, such as fuel combustion), indirect emissions (Scope 2, such as purchased electricity), and other indirect emissions associated with the upstream and downstream activities in the supply chain (Scope 3, including purchased goods and services, transportation and distribution, business travel, and employee commuting).

While many companies have taken steps to reduce Scope 1 and Scope 2 emissions, approximately 70-90% of greenhouse gas emissions come from Scope 3 upstream and downstream supply chain activities. Therefore, reducing emissions in the supply chain is crucial for companies to achieve long-term carbon goals, and neglecting supply chain emissions can hinder the realization of these goals.

CBAM (Carbon Border Adjustment Mechanism), is the EU's international trade policy tool to address climate change. As of 1 January 2026, CBAM costs are officially applicable.

Currently, CBAM covers six sectors: cement, aluminium, fertilisers, iron and steel, chemicals (hydrogen), and electricity. Whether an export product is subject to CBAM is determined by its CN code.

Furthermore, the European Commission also proposes extending CBAM to downstream products, planning to include 180 steel- and aluminium-intensive products, such as machinery and parts, automotive components, household appliances, electrical equipment, and metal products. This expansion is expected to take effect on 1 January 2028.

Life Cycle Assessment (LCA) is an internationally standardized method for evaluating the environmental impacts of a product, process, or service across its entire life cycle. Conducted in accordance with ISO 14040 and ISO 14044, it covers all stages—from raw material extraction and manufacturing to distribution and transport, product use, and end-of-life treatment (i.e., “cradle to grave”).

LCA helps enterprises identify environmental hotspots across the value chain to drive eco-design, and provides essential data support for responding to increasingly stringent environmental regulations worldwide.

An Environmental Product Declaration (EPD) is a Type III environmental declaration developed in accordance with ISO 14025. Grounded in life cycle assessment (LCA), it discloses a product's environmental impacts across its full life cycle—from raw material acquisition and manufacturing to transport, use, and end-of-life treatment—covering indicators such as carbon footprint, resource use, and acidification.

An EPD is independently verified by a third party and is widely recognized internationally for its high level of transparency and credibility.