Most large Indian companies have a greenhouse gas number somewhere. It might sit inside their BRSR return, their annual sustainability report, or a slide prepared for an investor meeting. What many do not have is the documented, methodology-driven, source-verified GHG inventory that number is supposed to come from.
That gap is getting harder to ignore. BRSR Core now requires third-party assurance for India's largest listed companies. Global buyers are requesting supplier emissions data that can withstand scrutiny. And India's Carbon Credit Trading Scheme (CCTS), notified by the Ministry of Power in 2023, is expected to increase reporting and verification requirements for obligated entities in energy-intensive sectors as implementation progresses.
The question for most Indian organizations is no longer whether they need a GHG inventory. It is whether the one they have is built to hold up.
What a GHG Inventory Actually Is
A GHG inventory is a structured account of all greenhouse gas emissions produced by an organization within a defined boundary and reporting period. It is not a single figure. It is a documented process that produces that figure — specifying which emissions are counted, which are excluded, where the data came from, and which emission factors were used to convert activity data into tonnes of carbon dioxide equivalent (CO₂e).
The international standard most widely used for this process is the GHG Protocol Corporate Accounting and Reporting Standard, developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD). The standard defines accounting boundaries, calculation approaches, and reporting principles that are referenced by many major disclosure frameworks, including CDP, BRSR, TCFD-aligned reporting, and the ISSB standards.
The Three Scopes
Under the GHG Protocol, emissions are organized into three categories.
Scope 1
Scope 1 covers direct emissions from sources the organization owns or controls: combustion in owned boilers and furnaces, company vehicle fleets, industrial process emissions, and fugitive releases from refrigerants. These are emissions generated directly by the organization.
Scope 2
Scope 2 covers indirect emissions associated with purchased electricity, steam, heat, or cooling. The organization does not combust the fuel itself, but its energy consumption drives the demand for generation. For many Indian manufacturing companies, Scope 2 represents a significant portion of total emissions.
Scope 3
Scope 3 covers all other indirect emissions across the value chain. These may include emissions embedded in purchased raw materials, transportation, business travel, waste management, product use, and end-of-life treatment. Scope 3 is typically the most complex category and, in many sectors, the largest source of emissions.
For BRSR reporting, listed companies disclose intensity metrics based primarily on Scope 1 and Scope 2 emissions. For CDP Climate, organizations disclose Scope 1, Scope 2, and relevant Scope 3 categories and are assessed on the completeness, transparency, methodology, and quality of those disclosures. For supplier questionnaires from global customers, Scope 3 Category 1 (Purchased Goods and Services) is increasingly a key data point requested from Indian suppliers.
Why This Is Urgent for Indian Companies Right Now
Three separate pressures are converging on Indian organizations.
Mandatory Disclosure and Assurance
SEBI's BRSR Core framework requires reasonable assurance of specified ESG disclosures in a phased manner, beginning with the top 150 listed entities by market capitalization from FY 2023–24 and extending to the top 250 entities from FY 2024–25.
Assurance of greenhouse gas disclosures requires traceable and well-documented methodologies. An emissions figure assembled informally -without source-level activity data, documented assumptions, and referenced emission factors is difficult to assure. Assurance providers need to be able to trace reported figures back to supporting evidence and calculations.
A Developing Carbon Market
India's Carbon Credit Trading Scheme (CCTS), notified in 2023, establishes the framework for a domestic carbon market. The existing Perform, Achieve and Trade (PAT) mechanism already requires energy performance reporting from designated consumers in energy-intensive sectors.
As the CCTS implementation evolves, robust GHG accounting and reporting are expected to become increasingly important for demonstrating compliance, participating effectively in the scheme, and responding to future regulatory requirements.
Global Supply Chain Requirements
Indian exporters supplying customers in Europe, North America, Japan, and other international markets are increasingly being asked to provide Scope 1 and Scope 2 emissions data, often supported by documentation or third-party verification.
The European Union's Carbon Border Adjustment Mechanism (CBAM) applies to imports of selected carbon-intensive products, including steel, aluminium, cement, fertilisers, hydrogen, and electricity. Compliance increasingly requires facility-level emissions data supported by documented methodologies and evidence. Reliance on rough estimates may result in the use of default values or create challenges during verification and customer due diligence processes.
The Difference Between a Number and an Inventory
An emissions number tells you how much. A GHG inventory tells you - and everyone who reviews it - exactly how you know.
This distinction matters because the same final figure can result from either a rigorous, documented calculation process or a rough estimate that has never been reconciled against source data. From the outside, the two may look identical. Under assurance, regulatory review, investor scrutiny, or customer assessment, they are not.
A GHG inventory that aligns with GHG Protocol principles or ISO 14064-1 includes elements that a simple calculation often lacks:
- A documented organizational boundary defining which entities and facilities are included and on what basis (operational control, financial control, or equity share)
- A defined reporting year and a documented base year where applicable
- A recalculation policy for significant structural or methodological changes
- Referenced emission factor sources and versions applicable to the reporting period
- A documented rationale for exclusions
- Data quality controls and treatment of uncertainty where relevant
Most importantly, the inventory is reproducible. If an assurance provider, customer, investor, or regulator asks to trace a Scope 2 figure back to the electricity consumption data and emission factor used, that trail should be readily available. For many organizations, that level of traceability remains a work in progress.
Building One That Lasts
Constructing a GHG inventory for the first time or reviewing an existing one for methodological robustness - typically follows a structured process:
- Define organizational boundaries.
- Identify all relevant emission sources.
- Collect activity data for each source.
- Select appropriate emission factors for the reporting period and geography.
- Calculate emissions.
- Document assumptions, methodologies, and exclusions.
- Review for completeness, consistency, and accuracy.
For Indian companies, commonly referenced sources may include:
- Central Electricity Authority (CEA) – CO₂ Baseline Database for the Indian Power Sector for grid electricity emission factors.
- Bureau of Energy Efficiency (BEE) – sector-specific information relevant to designated consumers under the PAT scheme.
- IPCC Guidelines for National Greenhouse Gas Inventories – for methodologies and default emission factors where country-specific factors are unavailable.
Organizations should select and document their accounting framework such as the GHG Protocol Corporate Standard or ISO 14064-1 - before beginning data collection, rather than attempting to align calculations retrospectively.
The inventory is not a one-time exercise. It is an annual process whose quality improves over time through better data systems, clearer boundary definitions, stronger documentation practices, and more consistent emission factor management. Organizations that establish robust inventory processes early often find that assurance, disclosure, customer reporting, and target-setting become significantly easier in subsequent years.
The Bottom Line
India's listed companies are moving toward increasingly rigorous sustainability disclosure requirements. India's energy-intensive sectors are preparing for a developing carbon market. And India's export-oriented industries are being drawn into global emissions reporting expectations regardless of domestic regulatory obligations.
An emissions figure that cannot be traced back to a documented methodology is unlikely to withstand assurance, customer due diligence, investor scrutiny, or future regulatory requirements.
The inventory is the foundation. Everything built on top of it - disclosures, targets, transition plans, renewable energy claims, and carbon market participation - is only as credible as the inventory underneath.