UK firms face carbon reporting

BRITISH FIRMS may soon face mandatory carbon reporting and that issue of carbon reports is on the agenda of the UN Climate Change Conference in Copenhagen in December.

Much like annual financial reports, carbon reports illustrate the strategy, targets, performance, and benchmarking of how the company is working to reduce its impact on climate change with a wide range of metrics included.

Against this background, accountancy firm PricewaterhouseCoopers (PwC) has developed a template for how firms should present such a statement of their environmental impacts.

The template resembles a company’s annual financial report and is based on a fictitious listed technology company called Typico, with operations in the US, Asia and the UK.

While the extent of disclosure will vary according to the nature and size of organisation concerned, PwC says the Typico example sets out what it believes to be good practice for larger companies and those who will face mandatory reporting of greenhouse gas emissions.

According to PwC’s Bartley O’Connor, the model brings together all of the existing and anticipated reporting requirements of national and international regulatory bodies in one example, giving a comprehensive demonstration of how companies can report their strategy and performance in dealing with climate change.

“There is an increased move now to integrated reporting with a focus on the triple bottom line, encompassing the three Ps – profit, people and planet,” O’Connor notes.

“Forward-looking analysis and statements of the risks and opportunities affecting a business will become an established part of the reporting cycle. This model will support companies’ preparations for that by helping them identify the right questions to ask, the right data to measure and report on, resulting in them taking the right actions for their business.”

While carbon reporting is not mandatory in Ireland yet, O’Connor says the corporate sector is showing an interest in developing best practice in this area in anticipation of future regulatory requirements.

O’Connor singles out Bord Na Móna as a good example of a company showing leadership in this area. The firm, whose business model has traditionally involved extracting fossil fuels, has set out a clear vision for how it can become a more environmentally friendly enterprise in a detailed sustainability report.

Among the initiatives the company is taking are moves to displace 30 per cent of the peat used in its power plants, a €300 million investment in green business over the next five years and a planned 50 per cent reduction in CO2 emissions over the same timescale.