Input-Output Carbon Accounting Explained (And How It Works for Scope 3 Emissions)

Ask any sustainability manager which part of the corporate footprint keeps them awake at night and you’ll hear the same answer: Scope 3 emissions. These indirect, supply-chain-centred emissions often account for 70 %-90 % of a company’s climate impact, yet the data needed to measure them can feel maddeningly out of reach.

Enter input-output (IO) carbon accounting: a proven, economics-based approach that converts everyday spend data into sector-level greenhouse-gas estimates. In this post we’ll break down what IO carbon accounting is, how it works, and why it remains one of the most effective ways to cover Scope 3 quickly while you build relationships with suppliers.

1 What Is Input-Output Carbon Accounting?

The method builds on input-output tables first formalised by Nobel laureate Wassily Leontief. These national tables describe how each economic sector buys from and sells to every other sector, effectively mapping the entire web of supply, chain flows.

Researchers extend these tables with environmentally-extended IO (EEIO) factors: kilograms of CO₂-equivalent per pound (or dollar) of output for each sector. Combine the two, and you can trace the embodied emissions that ripple through the economy.

In practice:

Collect spend data – e.g. £80 000 on “IT services”, £50 000 on “business travel”.

Map each spend line to an IO sector – “IT services” → Computer programming, “travel” → Air passenger transport.

Multiply by sector-specific emission intensities – 0.45 kg CO₂e/£ for IT, 0.19 kg CO₂e/£ for air travel (illustrative).

Sum results for a cradle-to-gate footprint covering Scopes 1, 2 and large chunks of Scope 3.

Because the IO table already embeds upstream supply-chain relationships, each £ spent carries the average emissions of the entire chain behind it, no supplier survey required.

2 Why IO Works So Well for Scope 3

Supplier data unavailable?

National IO tables fill the gap with statistically valid averages.

Huge vendor count?

One factor per spend category covers thousands of individual suppliers.

Time pressure?

Financial data is ready-made; mapping and calculation take minutes, not months.

Audit trail required?

EEIO databases such as EXIOBASE or UK BEIS publish transparent factor sources.

For mid-sized companies, IO footprints provide an 80 / 20 solution: instant visibility of major hotspots so that reduction work can start before perfect data arrives.

3 Strengths and Limitations

Strengths

• Breadth over depth – Captures all purchased goods and services from day one.
• Comparability – IO factors stem from standard national accounts, making footprints comparable across companies and years.
• Cost-effective – No need for life-cycle assessments on every product line.

Limitations

• Averages not specifics – A supplier running on 100 % renewable electricity receives the sector average unless you override it.
• Price sensitivity – Inflation affects £-based intensities; annual factor updates mitigate this.
• Granularity gap – Not ideal for product labels or Environmental Product Declarations.

The key is to treat IO as stage one in a refinement journey, exactly how Emitrics structures its factor hierarchy.

4 How Emitrics Uses IO for Rapid Baselines

Emitrics connects directly to your accounting software, categorises transactions with AI, then applies the latest EEIO factors from reputable databases (e.g. UK BEIS, EXIOBASE). Within minutes you gain:

• Full Scope 3 coverage – Purchased goods, capital goods, professional services, even indirect commuting estimates.
• Hotspot dashboards – See which spend categories and suppliers drive 80 % of emissions.
• Action prompts – Target categories for supplier engagement or alternative sourcing.

From there, you can progressively upload supplier-specific or product-level factors, overriding IO averages where precision matters most.

5 Common Myths Debunked

“IO carbon accounting is inaccurate.”It’s less precise than a tailored life-cycle assessment, but numerous peer-reviewed studies show IO results typically sit within ±20 % of activity-based models for corporate-level footprints—well inside the error margins accepted by many reporting frameworks.

“Auditors won’t accept spend-based data.”The GHG Protocol recognises IO-based methods as valid for Category 1 (purchased goods and services) and Category 2 (capital goods) as long as factor sources and uncertainties are disclosed.

“You can’t track progress with averages.”You can. Year-on-year changes in spend mix, revenue intensity and category factors all reveal directional improvement. Emitrics also lets you lock factor versions for fair comparisons.

6 When to Combine IO with Other Methods

Regulatory compliance (SECR, CSRD):

IO baseline + higher-confidence factors for energy and fuel.

Supplier contract renewal:

Replace IO with supplier-provided emission intensities.

Product eco-label:

Conduct a cradle-to-gate life-cycle assessment alongside IO corporate footprint.

The beauty of a platform like Emitrics is that you can mix and match factor types without losing the audit trail.

Conclusion

Input-output carbon accounting offers a fast, defensible path to Scope 3 measurement, vital for companies that need a footprint now, not in six months. Treat it as the foundation: capture everything, identify priorities, then refine supplier by supplier.

With Emitrics, IO is just the starting block. Our progressive refinement engine guides you from default EEIO factors to supplier-specific data and beyond, all while keeping calculations transparent and audit-ready.

Ready to turn hard-to-reach Scope 3 emissions into clear, actionable numbers? Book an Emitrics demo today.