what is the difference between scope 1 scope 2 and scope 3

Scope 1, 2 and 3 are three types of emissions, not three levels of difficulty

Scope 1 is the emissions that come directly from assets or activities you own or control: the fuel burned in your own vehicles or installations. Scope 2 is the emissions generated when producing the energy a company purchases, typically electricity, heat or steam sourced from a supplier. Scope 3 is everything else: all emissions occurring further down the chain, at suppliers, in transport by third parties, or when customers use a sold product. This classification is not something the VSME standard or the CSRD invented — it is the classification of the GHG Protocol, the international calculation method for emissions adopted by both EFRAG and virtually every other reporting framework.

For an SME receiving a questionnaire from a customer, bank or insurer, the practical difference is mainly this: scope 1 and scope 2 are fairly easy to substantiate from your own documents, such as an energy bill or fuel receipts. Scope 3 is more challenging, because those figures concern the chains of others and a company has less visibility into them. The basic module of the VSME standard asks in practice mainly for scope 1 and scope 2, and does not routinely require a complete scope 3 breakdown. Anyone wanting to know whether scope 3 is permitted or not in a specific questionnaire should read the answer to the question of whether a customer may ask all sustainability questions.

Where this classification is established: the GHG Protocol and the VSME basic module

The scope classification itself comes from the GHG Protocol, the calculation method that serves as the international standard for classifying greenhouse gas emissions into direct and indirect sources. The VSME standard of EFRAG builds on this classification in its basic module and determines which scopes a non-listed SME must report at minimum. Which specific figures belong there — and which conversion factor translates fuel or energy into emissions — is described on the page about what an emission factor is and why a reference date is attached to it. Anyone who first wants to know what the VSME basic module generally expects from a company should read that on the page about what VSME is and what it means for an SME.