Definition
Carbon footprint measures the total greenhouse gas emissions associated with a company's operations, expressed in CO2 equivalents. It includes direct emissions (Scope 1), purchased energy (Scope 2), and supply chain emissions (Scope 3). Investors use carbon metrics to assess climate risk and transition exposure.
Formula
Carbon Intensity = Total Emissions / Revenue or Market Cap
Example
Company A has carbon intensity of 100 tons CO2 per $1M revenue, higher than the industry average of 60 tons, indicating climate risk.
FAQ
What is Carbon Footprint?
Total greenhouse gas emissions caused directly and indirectly by a company.
How do you calculate Carbon Footprint?
A common formula for Carbon Footprint is: Carbon Intensity = Total Emissions / Revenue or Market Cap
Why is Carbon Footprint important?
Carbon Footprint helps investors evaluate ESG and make more informed decisions.