Emissions Reporting
Decarbonization
What is the Role of Carbon Accounting in Supply Chain Decarbonization?
Searoutes team
5 May 2025
As companies come under increasing pressure to decarbonize, carbon accounting has emerged as a critical enabler of meaningful emissions reduction. As British physicist Thomas Kelvin said, “If you can not measure it, you can not improve it.”
In 2025, shippers face a highly dynamic global emissions landscape, replete with a fast-changing regulatory and trade environment, continually evolving consumer expectations, and forecast extreme weather events. This unpredictable trade landscape, coupled with rising operational costs, leaves companies facing near unprecedented uncertainty in 2025.
In this unpredictable transportation environment, reliable emissions calculation and data provides much needed clarity to establish their scope 3 emissions forecast and output.
For shippers, understanding and acting on their carbon footprint is no longer a strategic option — it’s an operational imperative. Carbon accounting provides the foundation for sustainable logistics planning, emissions reduction strategy, and operational efficiency in a rapidly evolving regulatory landscape. With supply chain emissions resulting in nearly a third of total global emissions, it’s time for businesses to develop the strategic carbon accounting practices required to build a better supply chain.
The Evolving Role of Carbon Accounting in 2025
Despite governments scale back domestic climate regulation, shippers remain under significant pressure to decarbonize. Market forces, customer demands, and global policies are all moving in one direction: toward greater emissions accountability. Nowhere is this more evident than in the European Union, where the EU Emissions Trading System (EU ETS) has continued to scale its impact across the transportation sector both within the EU and globally. Shippers with Europe-bound cargo must now track and report well-to-wake emissions, purchase emissions allowances, and align their operations with a carbon pricing structure that directly affects the bottom line. The Carbon Border Adjustment Mechanism (CBAM) compounds this shift. It applies carbon pricing to imported goods based on embedded emissions, creating a new layer of financial risk for companies lacking visibility into their upstream freight emissions. Together, EU ETS and CBAM represent a turning point for carbon accounting: accurate, lane-level emissions data is no longer a nice-to-have — it’s the standard of doing business in international trade.In 2025, Accurate Carbon Accounting is a Business Imperative
For both EU and non-EU shippers, the stakes are high. Failing to comply with European climate regulations can result in financial penalties, delayed shipments, and strained trade relationships. If operators fail to purchase enough allowances to cover emissions under EU ETS, they could face a fee of 100 euros per ton of excess emissions, according to the European Union, with that number rising over time. But the impact of carbon accounting goes far beyond cost. Carbon data is now central to ESG reporting, supplier evaluations, and customer communications. Stakeholders — from investors to procurement officers — expect measurable, transparent climate progress. That means relying on generic emissions averages is no longer sufficient. Scope 3 emissions, particularly those tied to freight and logistics, must be measured at the lane, carrier, and vessel level. While the EU’s “Stop the Clock” provision offers a temporary pause in maritime ETS enforcement for certain routes, supply chain carbon measurement remains part of the broader EU ETS Omnibus regulation. This pause is not a pass — it’s a window for companies that haven’t started measuring emissions to prepare before enforcement resumes in full. In 2025, carbon accounting is not just about checking boxes — it’s about building resilience, trust, and competitive advantage in a decarbonizing world.Today’s Shippers Face Roadblocks in Building Accurate Carbon Accounting Practices
While the need for robust carbon accounting is clear, implementation is anything but simple. Most shippers face serious challenges in building reliable emissions data frameworks.- Data Gaps and Inconsistencies are widespread. Carrier-reported emissions vary in precision, methodology, and formatting. Some carriers provide high-quality service-level data, while others rely on outdated or incomplete estimates. For shippers, reconciling this patchwork of inputs is time-consuming and error-prone.
- Scope 3 Complexity only adds to the challenge. Freight is often outsourced across multiple carriers and modes, making emissions tracking fragmented. Without a precise, methodical emissions view, it becomes nearly impossible to identify meaningful reduction opportunities — or prove compliance to regulators.
- Lack of Global Harmonization further complicates the picture. While the EU ETS sets the standard in carbon regulation, many countries have yet to align. As a result, multinational businesses must navigate a patchwork of frameworks, each with different requirements and expectations.