# The importance of multiregional accounting for corporate carbon emissions

## TL;DR

Using a multi-region model reveals that single-region models used by companies to estimate CO2 emissions may miss up to 10% of emissions, especially in manufacturing sectors.

## Contribution

The paper introduces a high-resolution multiregional input-output model to correct biases in corporate carbon emissions estimation.

## Key findings

- Upstream emissions of companies are underestimated by ~10% when using single-region models instead of multiregional models.
- The largest discrepancies occur in manufacturing sectors with moderate emissions intensity.
- Multiregional models can improve emissions inventory accuracy and guide data collection in energy-intensive sectors.

## Abstract

Corporations routinely use environmentally-extended input-output models to estimate and report greenhouse gas emissions upstream in their supply chains. However, the most widely used models assume that supply chains and emissions intensities of industries match those of a single region—usually the U.S. or the U.K. Here, we use a high-resolution multiregional input-output model to demonstrate the scale and pattern of emissions that may be missed by single-region models. We find that the upstream emissions of the companies reporting to CDP are together greater by 2.0 gigatons of CO2-equivalent emissions (~10%) when estimated by a multiregional model instead of a U.S.-based single-region model, with the largest differences in manufacturing sectors of moderate emissions intensity. Widespread adoption of multiregional models could thus improve the accuracy of corporate emissions inventories and help prioritize primary data collection and emissions reduction efforts, often by shifting focus to energy- and emissions-intensive sectors of industrializing nations.

This paper uses a multi-region model to show that single-region models used by thousands of companies to estimate CO2 emissions related to goods they purchase may drastically underestimate and misidentify the largest sources of upstream emissions.