# Should a family business group with several units use operational control or equity share for its carbon footprint?

Canonical: https://senseible.earth/answers/operational-control-vs-equity-share

Most family groups should use operational control: count 100% of every unit the group runs day to day, and nothing from units it only invests in. Use equity share when partly owned units run by partners are a large part of the group and your buyers or lenders want emissions in line with ownership.

## What the three approaches mean

These come from chapter 3 of the GHG Protocol Corporate Standard. ISO 14064-1:2018 allows the same choice between control and equity share.

- Operational control: 100% of emissions from every unit where the group has full authority to introduce and run its operating policies, whatever the ownership share.
- Financial control: 100% of units whose financial and operating policies the group directs to gain economic benefit, usually those consolidated as subsidiaries in the accounts.
- Equity share: each unit's emissions multiplied by the group's ownership share.

## Why operational control fits most family groups

- The family usually runs the units it owns, even when shares are spread across relatives, trusts and holding companies, so control is clearer than the ownership chain.
- You hold the bills for the units you run, so the data is available.
- Buyers mostly ask a supplier for the emissions of the plant that makes their product, which matches control.

## When equity share is the better choice

- The group has large stakes in joint ventures that a partner manages.
- Lenders or investors want emissions to follow the financial interest in each unit.
- Ownership is stable and documented, so the percentages can be shown.

## Rules once you choose

1. Apply one approach to every unit and every gas, and state it in the report.
2. Under a control approach, a unit you hold shares in but do not control drops out of Scope 1 and 2; its emissions can appear in Scope 3 Category 15, investments.
3. If units are bought, sold or merged, recalculate the base year so the trend stays comparable.

## Worked example: a group with three units

- Unit A: 100% owned, run by the family, 800 t CO2
- Unit B: 60% owned, run by the family, 500 t CO2
- Unit C: 30% owned, run by a partner, 1,000 t CO2
- Operational control: 800 + 500 = 1,300 t (Unit C left out of Scope 1 and 2)
- Equity share: 800 + (60% x 500 = 300) + (30% x 1,000 = 300) = 1,400 t

The choice changes the total by 100 t here, and changes which bills the group must collect.

## What Senseible does here

Senseible counts the bills and invoices you upload to an account. Which units belong in the boundary, and at what share, is your decision; Senseible does not apply equity percentages.

- [Carbon accounting](https://senseible.earth/carbon-accounting)
- [Scope 1, 2 and 3 explained simply](https://senseible.earth/climate-intelligence/scope-1-2-3-emissions-simple-guide-small-business)
- [Leased factory: which scope](https://senseible.earth/answers/leased-factory-emissions-which-scope)

Sources: [GHG Protocol Corporate Accounting and Reporting Standard (2004), chapter 3, setting organisational boundaries](https://ghgprotocol.org/corporate-standard), [ISO 14064-1:2018, clause 5.1, organisational boundaries](https://www.iso.org)

Last reviewed 2026-10-15.