The Department for Environment, Food & Rural Affairs (DEFRA) has published regulations governing how companies should report their greenhouse gas (GHG) emissions as required under the new narrative reporting framework to be introduced from October this year.
Amendments to the Companies Act 2006 announced earlier by the Department for Business, Innovation & Skills (BIS) include the provision of an annual directors' statement. In the case of listed companies, this has to include a report on the organisation's GHG emissions. DEFRA says that some public sector organisations may also wish to introduce such reports, while some non-listed companies may be asked to provide such data by larger supply-chain clients.
In Environmental Reporting Guidelines: Including mandatory greenhouse gas emissions reporting guidanceDEFRA sets out what it says are the key principles for accounting and reporting environmental impact. It says the information provided should be relevant, quantitative, accurate, complete, consistent, comparable and transparent.
The document sets out the steps a company should take to introduce environmental reporting, including setting the boundaries for what parts of the organisation are covered, the period for which data should be collected and which environmental impacts need to be assessed. There is advice on the methodology, approach to verification and an example GHG corporate report. The guidance covers the issues around reporting on an organisation's use of water, waste, resource efficiency and materials, as well as its emissions to air, land and water.
The new requirement comes into place for company reporting years ending on or after 30 September 2013. It relates both to direct emissions from activities owned or controlled by an organisation that releases emissions straight into the atmosphere, and indirect emissions which are associated with an organisation's consumption of purchased electricity, heat or steam.
Martin Baxter, executive director, policy, at the Institute of Environmental Management and Assessment (IEMA) said: 'GHG reporting can deliver significant benefits with around 70% of companies that IEMA surveyed saying that GHG reporting will deliver cost savings, and 77% saying it will lead to environmental benefits. These regulations will enable companies to manage longer-term environmental challenges such as climate change and ensure the drive towards a resource efficient and low carbon economy.'
