February 26, 2026
As software adoption accelerates and AI-driven workloads expand, Scope 3 emissions associated with the use of software products are emerging as a critical and complex challenge.
For many software companies, these emissions, whether classified as Category 11 (use of sold products) or embedded upstream in Category 1 (purchased cloud service), represent a significant and growing share of total climate impact. At the same time, customers, investors, and regulators are increasingly demanding product-level transparency and credible decarbonization strategies.
56-80 percent of the information and communication technology sector’s total life cycle emissions occur during the use phase.
Yet consistent accounting remains difficult. Existing standards were not designed with cloud-based and AI-enabled software models in mind, leaving ambiguity around boundary setting, operational control, and the distinction between Category 1 and Category 11. Limited access to granular cloud data, variability in methodologies, and inconsistent interpretations further constrain companies’ ability to measure and compare use-phase emissions in a reliable and decision-useful way.
To support companies navigating these challenges, BSR’s Scope 3 for Software (S34S) Roundtable report, Accounting for Scope 3 Use-Phase Emissions for Software Companies, synthesizes research, stakeholder interviews, and peer insights to clarify key measurement and accounting issues. Through case studies and ecosystem-level recommendations, the report outlines practical steps to improve methodological consistency, strengthen data transparency, and enable more credible accounting and meaningful decarbonization across the software value chain.
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