You do not have to calculate everything. You do have to justify what you left out.
An exclusion with evidence is accepted. An exclusion with no recorded reason is challenged.
What materiality means here
An item is material if leaving it out would change a reader's understanding of your emissions.
That is a judgement, not a threshold. No standard gives you a percentage. You decide, you document, and your assurer tests whether your reasoning holds.
The three questions
For anything you want to exclude, answer these:
How big is it? Estimate roughly. A category you cannot size at all cannot be called immaterial.
Could it be large? A category that is small this year but growing needs watching.
Would a reader expect it? A mining company excluding fuel would be challenged whatever the number says.
All three matter. A small number that a reader would expect to see still needs disclosing.
What people usually exclude
Exclusion | Typical evidence |
An immaterial entity | Its share of group revenue |
A Scope 3 category with no activity | A statement that the activity does not occur |
A small site | Its share of floor space, headcount or spend |
A minor emission source | Its estimated share of the relevant scope |
A gas with negligible volume | The estimated quantity |
Size it before you exclude it
The common mistake is excluding something without estimating it.
A rough estimate is enough. Spend-based figures, floor area, headcount or supplier counts all work. What matters is that a number exists and is recorded.
If the estimate comes back larger than expected, include it instead.
Be consistent between years
An item excluded last year and included this year changes your comparability. Record the change and its effect.
If an excluded item grows past materiality, include it and restate the prior year if you can.
Record it
For each exclusion, record four things:
What is excluded.
Your estimate of its size.
The basis of the estimate.
Why it is not material.
This goes into your Basis of Preparation.