FLAG Emissions: Calculation, Data and Requirements for Land-Based Accounting

FLAG emissions are greenhouse gases from forestry, land, and agriculture (Forest, Land and Agriculture) that arise through land use change and land management and are accounted for separately from energy- and industry-related emissions. Agriculture and forestry cause around 22 % of global greenhouse gas emissions. This article explains the definition, exposure, calculation, and data basis.

What are FLAG emissions?

FLAG stands for Forest, Land and Agriculture and covers greenhouse gases from land-based activities. The main sources are CO₂ from land use change, methane (CH₄) from livestock farming, and nitrous oxide (N₂O) from fertilisation. These gases are converted into CO₂ equivalents (CO₂e) to make them comparable. The term deliberately separates land-based emissions from energy- and industry-related emissions, because they behave differently in methodological terms and require their own reduction pathway.

A central point is the distinction between biogenic and fossil emissions. Biogenic emissions and removals come from biological processes such as plant growth, soil carbon, or the combustion of biomass, and they are part of the natural carbon cycle. They are not automatically climate-neutral: under unsustainable management, for example through deforestation or soil degradation, they contribute considerably to climate change. This is precisely why FLAG accounting treats biogenic flows as a separate category and does not net them to zero across the board.

Where do FLAG emissions come from?

FLAG emissions have two main sources: land use change and land management. In land use change, previously stored carbon is released, for example when forest is converted into cropland. Land management covers the ongoing emissions from operations: livestock farming, fertiliser use, and soil cultivation.

The topic becomes tangible for the target audience through specific commodities. Particularly FLAG-relevant are palm oil, beef, cocoa, coffee, soy, sugar, cotton, and paper. Companies that purchase or process such commodities carry land-based emissions in their supply chain, often without realising it. Your own exposure can therefore be read off the bill of materials: as soon as agricultural or forestry commodities play a relevant role, FLAG emissions are involved.

What is the difference between FLAG and non-FLAG emissions?

FLAG emissions end at the farm gate and cover only land use change and agricultural activities. The farm gate is the notional boundary at which a commodity leaves the farm. Non-FLAG emissions are everything that happens afterwards: transport, processing, and packaging.

The treatment of fossil and energy-related emissions that support agricultural production is important. The diesel for farm machinery or the electricity for irrigation pumps does not count towards FLAG; it is accounted for separately as non-FLAG. This separation is not a formality. It ensures that both emission types are handled with the appropriate reduction logic: fossil emissions through phasing out fossil energy, land-based emissions through changed land use and management.

FLAG or LULUCF: where is the difference?

LULUCF (Land Use, Land-Use Change and Forestry) is a reporting context for national greenhouse gas inventories under the rules of the IPCC and UNFCCC. Through it, countries report how land use and forestry affect their national climate balance. FLAG, by contrast, is an accounting framework at company level, with specific targets and methods for individual organisations.

Both are closely connected but view the same carbon flows from a different perspective. A company that accounts for FLAG often quantifies the same processes that also feed into a national LULUCF inventory, though from an organisational rather than a national viewpoint. For practice this means: LULUCF data and methods can be a useful reference, but they do not replace a company's own FLAG inventory with its specific system boundaries.

Which companies must account for FLAG emissions?

Whether a company must account for FLAG emissions depends on two triggers. The first is membership in a FLAG sector designated by the Science Based Targets initiative (SBTi): forest and paper products, food production, animal farming, food and beverage processing, tobacco, and food retail. The second trigger is a threshold: if FLAG emissions make up more than 20 % of total Scope 1, 2, and 3 emissions, the obligation applies regardless of the sector.

FLAG is therefore no longer a topic for large corporations alone. Mid-sized companies are also affected as soon as land-based commodities account for a relevant share of their supply chain. A textile company with a high cotton share or a confectionery producer with a lot of cocoa and palm oil can reach the 20-percent threshold faster than expected.

What does the SBTi's 20 % criterion say?

If FLAG-relevant emissions make up more than 20 % of total emissions across Scope 1, 2, and 3, a company must set a separate, science-based FLAG target under the SBTi. This target sits alongside the regular energy and industry target and does not replace it.

FLAG and non-FLAG targets are reported separately and must be achieved independently of one another. For the long-term FLAG target, the SBTi requires a reduction of at least 72 % by 2050 at the latest. The exact annual reduction rate for near-term targets depends on the base year, the target year, and the chosen sector or commodity pathway, and is determined through the pathways of the FLAG Guidance. There is no single blanket figure for 2030; what matters is the pathway calculated for the individual company.

The FLAG target is tied to a no-deforestation commitment. A company that sets a FLAG target commits to deforestation-free supply chains. The SBTi FLAG Guidance v1.2 of March 2026 clarified the deadline: companies submitting FLAG targets for the first time have up to two years after submission to eliminate deforestation, with an absolute deadline of 31 December 2030. The cut-off date is generally 2020 or earlier.

The GHG Protocol Land Sector and Removals Standard from 2027

The GHG Protocol Land Sector and Removals (LSR) Standard v1.0 was published on 30 January 2026 and becomes effective from 1 January 2027 for companies reporting under the Corporate Standard and the Scope 3 Standard. It is the first global standard that gives companies concrete requirements and methods for accounting for land emissions and CO₂ removals.

The accompanying LSR Guidance, with formulas, calculation examples, and case studies, was published on 30 June 2026. It already contains the requirements from the slightly revised Standard version 1.1.

A central clarification concerns the scope: version 1.0 applies to agriculture and CO₂ removal technologies, and explicitly not to the forestry sector, even though the "F" in FLAG stands for Forest. A separate workstream (Forest Carbon Accounting) is under way for forestry accounting and is intended to feed into later versions. The standard replaces the 2022 draft as well as the earlier Agricultural Guidance.

How do FLAG, CSRD, EU Taxonomy, and EUDR relate to one another?

FLAG-relevant emissions are increasingly required in reporting under ESRS E1 and in the EU Taxonomy as well. Companies must create transparency about emission-intensive supply chains, and land-based emissions are a substantial part of this for many sectors. FLAG accounting provides the methodological basis for meeting these requirements in a robust way.

The EU Deforestation Regulation (EUDR) is to be distinguished from this. It is a standalone legal obligation with its own timetable and targets verifiably deforestation-free products. FLAG is accounting, EUDR is product-related due diligence. Both address land use and deforestation and complement each other in practice, but they are not the same. A FLAG inventory does not automatically meet the EUDR requirements and should not be understood as a compliance solution for the regulation.

How are FLAG emissions calculated?

FLAG emissions follow the same basic principle as other emissions: activity quantity multiplied by emission factor. The difference lies in the dedicated categories and in the treatment of removals. Where a classic inventory simply sums emissions, FLAG accounting must additionally represent carbon sequestration, land use change, and possible displacement effects.

Which emission categories exist?

The LSR Standard distinguishes several categories, each covering a separate part of the land-based inventory. Land use change (LUC) captures emissions from the conversion of areas, for example from forest to cropland. Land management covers the ongoing emissions from operations, including net biogenic CO₂ emissions and production emissions. Biogenic product emissions concern emissions bound in the product itself or associated with it. CO₂ removals represent carbon sequestration. Land-use leakage captures the displacement of production to other regions.

Removals may be counted in the FLAG inventory if they occur on owned or controlled land and are verified and monitored over the long term. If a reversal occurs, for example when sequestered carbon is released again through a forest fire, previously reported sequestration must be recorded again as emissions. This keeps the inventory honest: only permanently secured storage counts.

Land use change: dLUC, sLUC, and iLUC

For land use change, the standard distinguishes three approaches, depending on the data situation and the traceability of the area.

Under the standard, LUC emissions are typically amortised over a period of 20 years, which corresponds to the IPCC default period for land transitions. They comprise CO₂, CH₄, and N₂O and are reported in kg CO₂e. The choice between dLUC and sLUC depends on how precisely the origin of a commodity can be traced: the better the traceability, for example through certification with area reference, the more the direct approach becomes possible.

Which calculation methods are available?

Three graduated approaches are available for the calculation, tiered by data availability. Direct measurement relies on soil samples, satellite and drone data, and sensor technology. It suits companies with access to their own land, for example in agriculture or forestry. The model-based approach calculates with emission factors following the pattern purchased quantity times factor and is usually the pragmatic entry point for companies without their own land. Hybrid approaches combine the two and use primary data where it is available.

In many cases, the FLAG share can be separated out from existing emission factors. An existing Scope 1, 2, and 3 inventory then needs to be extended rather than replaced. This reduces the effort considerably, because companies build on activity data they have already collected and make the land-based shares visible in a targeted way.

Calculation example: FLAG emissions of a commodity

The basic calculation follows the familiar principle of quantity and factor. For a purchased commodity, the result is:

FLAG emissions (kg CO₂e) = purchased quantity (t) × FLAG emission factor (kg CO₂e/t)

Fictional example: 120 t palm oil × 3,600 kg CO₂e/t = 432,000 kg CO₂e = 432 t CO₂e

This example serves only to illustrate the calculation logic; the emission factor used is fictional. Real factors come from a documented database and vary considerably by region of origin, cultivation practice, and land use history. For your own inventory the rule is: always draw factors from a traceable source and document the source, rather than calculating with rounded example values.

For land use change, the LUC share can be calculated separately:

Net LUC emissions = affected area (ha) × carbon stock change (t C/ha) × 44/12

The result is amortised over 20 years. The factor 44/12 converts the mass of carbon (C) into CO₂.

How are FLAG emissions assigned to the scopes?

The scope assignment depends on whether a company manages the land itself or purchases commodities. If it manages its own land, for example in cattle farming, the land-based emissions fall into Scope 1. If it purchases agricultural commodities, for example feed or agricultural raw materials, the FLAG emissions usually fall into Scope 3, specifically category 3.1 (purchased goods and services), and partly 3.11.

In both cases the rule is: FLAG emissions are reported separately from the other emissions of the same scope. A company therefore shows not just a single Scope 3 value, but the FLAG and the non-FLAG share within Scope 3. This separation is the prerequisite for later setting a standalone FLAG target and tracking its progress cleanly.

What data and databases does FLAG accounting require?

Data quality determines the reliability of the entire FLAG inventory. Land-based emission factors scatter widely, and an inventory is only ever as good as the factors on which it is based. It is therefore worth clarifying early which data sources are available and where primary data makes the biggest difference.

Primary data or secondary data: what makes sense when?

Primary data comes directly from suppliers or from your own land and provides the highest accuracy. However, it is laborious to collect, because it requires close collaboration with the supply chain. Secondary data consists of generic emission factors from databases. It is the pragmatic entry point when primary data is missing, and it allows a first robust approximation.

In practice, a data hierarchy has proven effective: first calculate with generic factors to obtain a complete picture, then gradually add primary data where the FLAG share is high. This way, the collection effort flows precisely into the commodities that have the greatest leverage on the result, rather than being spread evenly across the entire bill of materials.

Which databases provide FLAG emission factors?

Several established databases provide emission factors for land-based commodities. They differ in focus, coverage, and accessibility.

In addition, the GHG Protocol provides the methodological basis through the Land Sector and Removals Standard and the accompanying Guidance, according to which fossil emissions, biogenic emissions, and biogenic removals can be cleanly separated. The databases provide the factors, the standard provides the rules for applying them. When in doubt, check figures on data volume or country coverage directly with the publishers, as the data stocks change continuously.

Why is the data situation for FLAG so difficult?

The data situation for FLAG is demanding for three reasons. First, supply chain data on land use is often patchy or hard to access, because it sits deep in upstream stages with which companies have little direct contact. Second, differing emission factors and methods make comparability difficult, so that two inventories for the same commodity can diverge significantly. Third, long-term land use changes must be monitored continuously, because carbon stocks change over years.

A practicable way out begins with a hotspot analysis of the Scope 3 inventory. It shows in which commodities the FLAG share is largest. It is precisely there that it pays to build up primary data and involve the supply chain in a targeted way, while secondary data is sufficient for less relevant items at first.

Capturing FLAG emissions in practice

A robust FLAG inventory starts at three points. First, the FLAG share within the Scope 3 inventory needs to be identified, usually through a hotspot analysis. Then suitable emission factors and databases are selected that match the relevant commodities. Finally, primary data is built up where the leverage is greatest, while secondary data is sufficient for subordinate items.

In practice, the FLAG share can often be separated out from an existing inventory rather than setting up a new data collection. Software-supported CCF and Scope 3 accounting such as that of Global Changer can separate land-based emissions out of existing emission factors and report them as a dedicated category. This creates the separation between FLAG and non-FLAG emissions required for a FLAG target, based on the data a company has already collected.