The most common sustainability terms? - Part 2
Following our first article defining sustainability & its most common terms, please find below the explanation of new terms:
LCA (Life Cycle Assessment):
LCA is an evaluation method used to assess the environmental impacts of a product, process, or service throughout its entire life cycle. It takes into account the extraction of raw materials, manufacturing, distribution, use, recycling, and disposal stages to quantify and analyze the environmental burdens and benefits associated with the assessed system.
Scope 1, 2, and 3 emissions:
Scope 1, 2, and 3 emissions are categories used in greenhouse gas (GHG) accounting to classify and measure emissions from different sources.
- Scope 1 emissions refer to direct emissions that occur from sources that are owned or controlled by a company, such as emissions from burning fossil fuels or operating manufacturing equipment.
- Scope 2 emissions include indirect emissions resulting from the consumption of purchased electricity, heat, or steam by a company.
- Scope 3 emissions encompass all other indirect emissions that occur in the value chain of a company, including emissions from activities such as transportation, procurement of goods and services, and waste disposal.
Carbon credit:
Carbon credits are a tradable financial instrument that represents the reduction or removal of one metric ton of carbon dioxide (or its equivalent) from the atmosphere. They are used as a mechanism to incentivize and finance projects that reduce greenhouse gas emissions. By purchasing carbon credits, organizations or individuals can offset their emissions and support projects contributing to climate change mitigation.
Carbon offset refers to the practice of compensating for greenhouse gas emissions produced by an individual, organization, or event by investing in projects.
ETS (Emissions Trading System):
ETS is a market-based approach used to control and reduce greenhouse gas emissions. It involves setting a cap on the total amount of emissions allowed by regulated entities, such as companies or industries. These entities are issued a limited number of emission allowances that can be traded among themselves. By creating a market for emission allowances, the ETS provides economic incentives for companies to reduce their emissions and rewards those that achieve emissions reductions more efficiently.
MRV (Measurement, Reporting, and Verification):
MRV is a process used to measure, report, and verify the greenhouse gas emissions and mitigation actions of organizations, projects, or countries. It involves collecting accurate and transparent data on emissions, implementing robust monitoring systems, and conducting independent verification to ensure the credibility and integrity of reported information. MRV is crucial for assessing progress towards emission reduction targets, tracking the effectiveness of climate policies, and facilitating international cooperation and accountability in addressing climate change.
CSR (Corporate Social Responsibility):
CSR refers to the voluntary initiatives and actions that a company takes to integrate social, environmental, and ethical concerns into its business operations and interactions with stakeholders. It involves considering the company's impact on society and the environment, promoting sustainable practices, and engaging in activities that benefit the community and address social issues.
Ethical investment:
Ethical investment, also known as socially responsible investment (SRI) or sustainable investment, refers to making investment decisions based on financial considerations and ethical or sustainability criteria. Ethical investors seek to support companies and projects that align with their values and have a positive social or environmental impact. They may avoid investing in industries or companies involved in activities such as fossil fuel extraction, tobacco production, or human rights violations, and instead choose to invest in sectors that promote renewable energy, fair trade, or social equity.
