International trade drives 20 percent of global emissions but importing countries exclude it from national targets: what the gap means for Scope 3 reporters

Emissions linked to internationally traded goods and services account for 20 percent of global greenhouse gas output, according to research published this week, but the governments of major importing countries do not include these flows in their national climate targets or policy frameworks. The researchers behind the study argue that governments should begin discussing how to tackle consumption based emissions, with particular attention to large importing economies. The finding places the political gap between production based national accounting and the actual emissions footprint of consumption in sharp relief.

For ESG practitioners, the research directly maps onto the challenge of Scope 3 category 1 emissions: purchased goods and services. Under GHG Protocol methodology and ESRS E1 disclosure requirements, companies are already expected to account for the emissions embedded in what they buy, even when those emissions occur in a different country and under a different regulatory regime. What the study highlights is that the national policy frameworks that companies operate within offer no parallel obligation at the sovereign level, creating a structural mismatch between corporate disclosure standards and government accountability.

The gap has practical consequences for procurement leads trying to engage suppliers on emissions data. A supplier based in a country where production emissions are not priced or regulated has little external incentive to invest in measurement or reduction, because no domestic policy creates that pressure. Buyers in Europe or the UK who are required to report Scope 3 figures under CSRD or the UK's own disclosure frameworks therefore face a data collection challenge that is partly a consequence of this policy vacuum. Automated supplier engagement tools that can reach across jurisdictions become more important precisely because regulatory harmonisation at the governmental level remains distant. The gap between what buyers must disclose and what suppliers are equipped to report is exactly where platforms like SOMA operate, helping companies collect structured emissions data from international supply chains without waiting for policy to catch up.

The research singles out large importing economies, a category that includes the European Union, the United States and China, as the places where consumption based emissions are most significant and most ignored. For European companies, CBAM is the closest existing instrument to a consumption based carbon price, but it covers a narrow set of industrial goods and does not address the breadth of traded products that the study's 20 percent figure encompasses. ESRS E1 disclosure of Scope 3 emissions does not carry a carbon price, but it does create reputational and investor accountability for the gap.

The researchers' call for governments to discuss trade linked emissions at an intergovernmental level suggests this will remain a live topic in multilateral climate forums. Sustainability managers who are building CSRD compliant Scope 3 inventories today are, in a sense, ahead of the policy curve: they are measuring what governments are not yet required to account for. That positions thorough Scope 3 disclosure as a future proof investment rather than a compliance cost, particularly as the pressure on importing nations to adopt consumption based accounting frameworks grows.