Mandatory Carbon Reporting Legislation Laid Before Parliament

Greenhouse Gas Report LSE

Share this post

Mandatory Carbon Reporting Legislation Laid Before Parliament

On June 12th the government laid before parliament the redrafted Mandatory Greenhouse Gas Emissions reporting legislation. The legislation which was first announced in June 2012 has now been formalised and released with detailed guidance on what and how to report.

The legislation requires companies to report their Greenhouse Gas Emissions as part of their Annual Reports. It also provides for voluntary reporting by any organisation.

The re-drafted regulations contained much long awaited clarity mainly around specifying exactly which listed companies are required to comply, who defines the organisational boundaries, and what should be included in the report.

Summary

All UK incorporated companies listed on the main market of the London Stock Exchange, a European Economic Area market or whose shares are dealing on the New York Stock Exchange or NASDAQ must include their Greenhouse Gas Emissions report as part of the annual returns.

The report must include:

  • The company’s Scope 1 and Scope 2 emissions as a minimum.  Including Scope 3 emissions is recommended in line with international best practice but is not a requirement in year 1.
    – Scope 1:  Fossil fuels such as natural gas, fuel consumed by company owned or leased vehicles, fugitive emissions such as refrigerants, and any process emissions.
    – Scope 2:  Electricity from the national grid and any purchased heat steam or cooling.
    – Scope 3: (optional):  Business travel, inbound and outbound freight, waste, water and key upstream and downstream value chain(supply chain) emissions.
  • Emissions for all company operations, processes and activities occurring not just in the UK, but for all global operations must be included in the report.
  • Emissions must be stated in Carbon Dioxide Equivalent accounting for all 6 Kyoto gases.
  • Gender Equality at organisation levels; a breakdown will be required of the number of men and women on the board, in senior management positions and in the company.

Reporting Format

The emissions reporting format must include at least one “Key Performance Indicator” which takes the form of a CO2e intensity indicator as a measure of business inputs or outputs. For example, per £ revenue or per employee, or per unit produced etc.

With the exception of the first reporting year, subsequent reports must state the preceding years performance also in order to provide transparency to actions taken and results towards improvement.

Timeline

Companies will be required to submit their Greenhouse Gas Emissions report for their first financial year ending after October 1st 2013.

Part 7 of The Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 specifically deals with Greenhouse Gas Emissions reporting.

Upcoming Webinars

TitleDateStart TimeDurationRegister
Live Webinar: CDP 2019 what to expect & Accuvio Announcement Join Accuvio and our special guest from CDP as we look at CDP 2019. Susan Butler Geary from Accuvio will then announce some exciting news about the software.24/4/20193:00pm BST1 hour
Register