FLAG emissions explained: What your organization needs to know

On a global scale, the Agriculture, Forestry and Other Land Use (AFOLU) sector is responsible for approximately 25% of the net anthropogenic greenhouse gas (GHG) emissions. To meet international climate goals, such as limiting global warming to 1.5 degrees Celsius or 2 degrees Celsius, urgent action is required. This includes halting deforestation, promoting afforestation and reforestation, and adopting sustainable land management practices. These measures are essential not only for reducing emissions but also for strengthening the land sector’s role as a carbon sink. 

This article provides an overview of the emissions associated with the AFOLU sector, clarifies who is responsible for reporting them, and explains whether setting a reduction target is required under the Science Based Targets initiative (SBTi). By the end, readers should have a clearer understanding of whether their organization needs to take further steps regarding FLAG emissions.

What are FLAG emissions?

FLAG, which stands for Forest, Land, and Agriculture, refers to greenhouse gas emissions and removals associated with land use, land-use change, forestry, and agricultural activities. These emissions are distinct in that they involve both biogenic carbon (originating from natural biological processes) and anthropogenic influences that alter the natural carbon cycle. Recently, FLAG emissions have gained increased attention. They represent a significant and often underreported share of global emissions and addressing them is critical to achieving existing science-based climate targets.

To better understand and manage these emissions, FLAG sources are typically grouped into four main categories. Each category represents a set of processes through which land and agricultural systems contribute to greenhouse gas emissions or removals:

• Non-land emissions - This category includes activities that occur on farms but are not directly tied to land use or land-use change. These include the use of synthetic inputs such as fertilizers, pesticides and herbicides, as well as fossil fuel combustion in farm machinery and energy use for irrigation or processing. It also encompasses upstream emissions from the production of agricultural inputs, particularly nitrogen-based fertilizers, which are energy-intensive to manufacture.
• Land-use change (LUC) emissions - These emissions arise when natural ecosystems such as forests, wetlands or grasslands are converted into agricultural land. This process releases significant amounts of carbon stored in vegetation and soils, especially in tropical regions where deforestation is a major driver of emissions.
• Land management emissions (non-LUC emissions) - This category results from ongoing agricultural practices that affect soil carbon and nitrogen cycles. These include emissions from fertilizer application, manure management, tillage and the drainage of organic soils like peatlands, which can release large quantities of carbon dioxide and nitrous oxide.
• Carbon removals - This refers to the sequestration of atmospheric carbon dioxide through practices such as agroforestry, cover cropping, improved pasture management and reforestation. These removals must rely on direct measurements or robust estimation methods and require long-term monitoring to ensure that the sequestered carbon is not later released to avoid a risk known as reversal.

Who needs to report FLAG emissions?

Given the broad scope of FLAG emissions, they are relevant to a wide range of organizations. According to the GHG Protocol’s Land Sector and Removals Guidance, any organization that maintains a corporate GHG inventory and engages in land-sector activities or reports carbon removals must account for FLAG emissions. This includes food and beverage producers, commodity traders, retailers with agricultural supply chains, and financial institutions with investments in land-intensive sectors.

Setting FLAG emissions targets

Not all organizations reporting FLAG emissions are required to set specific targets. The SBTi FLAG Guidance, which complements the GHG Protocol, outlines the conditions under which FLAG-specific targets must be set. This requirement applies to organizations operating in sectors such as forestry, timber, pulp and paper, rubber, agricultural production, food and beverage processing, food and staples retailing and tobacco.

Additionally, if an organization operates in a different sector but has FLAG-related emissions that account for more than 20% of its total GHG emissions or if more than 20% of its revenue is derived from FLAG-affected sectors, it must also set a FLAG target.

While the process for setting FLAG targets is similar to that for non-FLAG emissions, it’s important to note a key distinction: FLAG targets cover emissions from “cradle to farm gate”, including all emissions up to the point of harvest or production, but excluding downstream processing.

Putting it into practice

Understanding FLAG emissions and setting appropriate targets is just the beginning. For organizations operating in land-intensive sectors or those with significant FLAG-related emissions, now is the time to take action. Assessing your FLAG footprint and committing to science-based targets not only demonstrates climate leadership but also strengthens business resilience, aligns with stakeholder expectations and helps ensure compliance with evolving regulations.

How BDO Can Help

For organizations seeking support in understanding, calculating or setting targets for FLAG emissions, the BDO Climate and Decarbonization team offers the expertise and guidance needed to navigate this complex area. Whether you are just beginning to assess your FLAG emissions or are ready to set science-based targets, BDO can help you take the next step in your sustainability journey.

Would you like to learn more about how BDO can support your company? Contact one of our specialists.