September 15, 2025
The greenhouse gas (GHG) accounting landscape has reached a pivotal moment, with the GHG Protocol and International Organisation for Standardisation (ISO) announcing a strategic partnership to harmonise their standards and co-develop new ones. This step responds to the growing importance of these frameworks in global finance, supply chains, and corporate disclosures.
At Pathzero, we see this as a much-needed development. Both GHG Protocol and ISO standards have become essential to organisations worldwide, yet gaps and overlaps remain. These gaps have led to other initiatives – such as the Partnership for Carbon Accounting Financials (PCAF) – creating guidance that sometimes diverges from GHG Protocol itself. The result has been a patchwork of approaches that complicate disclosure and decision-making.
The ISSB (International Sustainability Standards Board) has already made significant progress in pulling together leading frameworks into one reference point. Its IFRS S2 standard absorbed the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), while also embedding industry-specific guidance from the SASB Standards. More recently, the ISSB has signed a Memorandum of Understanding with the GHG Protocol to align technical approaches and ensure consistency in how companies measure and disclose emissions.
These are encouraging signals that the ISSB intends to remain the global reference point for climate-related disclosure – yet significant challenges remain.
For users, in particular institutional investors, clarity on the quality of disclosures is essential. Too little attention is given to how the underlying numbers are derived. Were calculations based on detailed activity data or higher-level spend-based estimates? Has the emissions boundary been carefully defined and approved? Was the input data independently validated?
Full assurance over disclosures may still be some distance away, but practical mechanisms already exist to improve confidence. PCAF’s 1-to-5 data quality score provides one such model, offering a transparent indication of the rigour behind an emissions estimate. A harmonised GHG Protocol and ISO standard – aligned with the ISSB’s disclosure framework – presents an opportunity to embed similar signals of quality, enabling investors and other stakeholders to quickly and clearly interpret the reliability of disclosures.
As the industry awaits further detail on the timeline and scope of the ISO–GHG Protocol harmonisation, the combined efforts of the ISSB, GHG Protocol, and ISO hold promise. If successful, this could close existing gaps while also raising the bar for transparency, comparability, and data quality. For investors managing climate-related financial risk, the ability to understand not just the number itself, but the methods and data behind it, will be critical.