General
DIY carbon accounting: Why spreadsheets are failing finance teams
Misha Cajic
January 30, 2025
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7
min read
As organizations ramp up their sustainability efforts, finance teams are playing an increasingly important role in tracking and reporting carbon emissions. Many finance professionals default to spreadsheets for this work — they’re familiar, customizable, and easy to implement. But while spreadsheets may seem like a cost-effective solution, they often create more problems than they solve.
From compliance risks to time inefficiencies, relying on spreadsheets for carbon accounting can undermine the very goals finance teams are trying to achieve. Here’s why spreadsheets are failing finance teams — and how switching to purpose-built tools can simplify your carbon accounting process and deliver better results.
Carbon accounting has become much more than just crunching numbers. With the adoption of global standards like the Greenhouse Gas (GHG) Protocol, organizations are required to measure emissions across three scopes, including the notoriously complex Scope 3 emissions. Scope 3 includes emissions from upstream and downstream activities, such as supply chains, business travel, and product use. This often involves managing data from hundreds or even thousands of sources across multiple departments and stakeholders.
Spreadsheets aren’t equipped to handle this level of complexity. While they can process straightforward datasets, they fall short when managing multi-layered data, applying standardized emissions factors, or ensuring compliance with evolving regulations. For instance, aligning Scope 3 calculations with the GHG Protocol involves interpreting detailed guidance, normalizing supplier data, and calculating accurate emissions factors — all of which require significant manual oversight in a spreadsheet.
Purpose-built tools, such as Avarni, simplify this process. These platforms automate emissions calculations, integrate up-to-date emissions factor databases, and ensure compliance with reporting frameworks like the GHG Protocol.
For finance teams, accuracy is non-negotiable, especially when it comes to financial or sustainability reporting. However, spreadsheets are prone to human error. A misplaced decimal, an incorrect formula, or a data entry mistake can snowball into inaccuracies that undermine your entire carbon accounting process.
This is particularly problematic as regulators increasingly demand reliable carbon data. Frameworks like CDP and TCFD require transparent and accurate reporting, while new regulations like the EU’s Corporate Sustainability Reporting Directive (CSRD) and the SEC’s proposed climate disclosure rules impose strict compliance requirements. A spreadsheet error could not only damage your organization’s credibility but also expose you to regulatory penalties.
Advanced carbon accounting tools address this risk by automating data validation and processing. These systems are designed to reduce human error, ensuring the data you report is both accurate and reliable.
Finance teams are already stretched thin with responsibilities like budget planning, forecasting, and financial reporting. Adding manual carbon accounting to the mix can quickly overwhelm your team. Collecting emissions data from different departments, suppliers, and operational systems often requires hours of manual work. Then there’s the ongoing effort of updating spreadsheets, validating data, and generating reports—tasks that are both time-consuming and prone to error.
For finance teams, time is money. Instead of getting bogged down in the administrative side of carbon accounting, your team could be focusing on analyzing data, identifying cost-saving opportunities, or supporting strategic sustainability investments.
Switching to purpose-built platforms can eliminate many of these inefficiencies. By automating data aggregation, calculations, and reporting, these tools free up your team to focus on higher-value tasks.
When organizations first start tracking emissions, a spreadsheet might seem like enough. But as sustainability programs expand, the limitations of this DIY approach become glaringly obvious. Tracking Scope 1 and Scope 2 emissions for a single office might work in a spreadsheet, but scaling to include Scope 3 emissions across a global supply chain is a far more complex challenge.
Advanced tools like Avarni make it easier to scale carbon accounting efforts. These platforms automate the collection and analysis of Scope 1, 2, and 3 emissions data, allowing finance teams to manage large-scale sustainability programs efficiently. Many solutions also offer analytics and benchmarking tools, giving you deeper insights into emissions trends and helping you identify reduction opportunities.
Carbon accounting is a cross-functional effort that requires input from multiple stakeholders, including procurement, operations, and suppliers. Spreadsheets, however, are notoriously bad at supporting collaboration. Issues like version control, fragmented data, and siloed communication can make it difficult for finance teams to get the data they need when they need it.
Purpose-built carbon accounting tools solve this problem by centralizing data and enabling real-time collaboration. These platforms create a single source of truth, allowing different teams and stakeholders to contribute data seamlessly without risking duplicate or inconsistent information.
For finance teams tasked with managing carbon accounting, spreadsheets are no longer up to the task. The complexity of emissions reporting, combined with the growing need for transparency and compliance, demands more sophisticated tools. Advanced carbon accounting platforms offer automation, accuracy, and scalability, making them essential for organizations looking to meet today’s sustainability requirements.
By moving beyond spreadsheets and adopting purpose-built solutions like Avarni (trusted by firms like Schneider Electric & KPMG), finance teams can reduce compliance risks, save time, and deliver more accurate carbon data. This shift not only simplifies your accounting process but also positions your organization as a leader in the transition to a low-carbon economy.
