Climate series #3: Mandatory vs voluntary reporting of Scope 3

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In this episode, we explore how global climate policy—starting with the Paris Agreement and Europe’s Fit for 55 package—has shaped today’s reporting landscape. We explain the key differences between mandatory and voluntary disclosure frameworks, and how each supports both national climate goals and company-level transparency. You’ll learn:

What are the objectives of frameworks like CSRD, CBAM, TCFD (mandatory) vs CDP, EcoVadis (voluntary)?
What is reactive reporting and when does it apply?
How do reporting tools influence supplier engagement, customer requirements, and climate strategy development?

We also address ongoing challenges such as data harmonisation, inconsistent SME definitions, and outdated emission factors. And we make the case for using climate data not just to report—but to inform business strategy, manage risk, and build resilience.

Curious to find out more about climate disclosure? Check out our newest ESG reporting guide, as well as how Nexio Projects can help integrate this into your climate strategy.

Welcome back everyone to the next episode of the climate strategy series. We just had Scope 3 emissions climate strategy, and now it’s time for voluntary versus mandatory reporting. Another complex component of your climate strategy, César is going to clarify this to all of us.

César, the Paris Agreement introduced in 2015 marked a shift from the Kyoto Protocol’s approach to climate action. It established the concept of nationally determined contributions, or NDCs, allowing countries to set their own emission reduction targets based on their own capabilities and resources.

In response, the European Union developed the Fit for 55 package, aiming for a 55% reduction in emissions by 2030 compared to 1990 levels. This goal is supported by various legislative measures including the Energy Efficiency Directives or Article 8, upon other reporting frameworks which serve different purposes.

Compulsory reporting, for instance CSRD, the Carbon Border Adjustment Mechanism, or TCFD, monitors progress towards national goals, provides data for benchmarking in the EU’s commitment, or ensures comprehensive coverage of relevant companies.

Secondary voluntary reporting, for instance CDP or EcoVadis, acts as independent third-party evaluators, assesses companies’ climate ambitions and data completeness, offers transparent access to stakeholders, creates robust databases for evaluating company ambitions, and provides visibility and assessment for organisational climate maturity.

Then there is also reactive reporting. This is when you need to provide specificities of your climate strategy and greenhouse gas emissions to your stakeholders such as customers due to a bidding process or to share emissions based on the volume of purchase and whether you have a target in place or not.

While compulsory reporting is crucial for national-level decision making, voluntary reporting offers greater visibility and connects companies with immediate stakeholders such as customers, suppliers, and shareholders.

Challenges remain in harmonising data demands across platforms including defining terms consistently across national contexts, standardising emission factor units—for instance CO2 versus CO2 equivalent—or outdated emission factors.

In regions lacking national monitoring systems, voluntary reporting repositories often serve as the primary option for climate-related data collection and assessment.