Business gains from emissions reporting says DEFRA

Businesses say that reporting makes good business sense as it has financial benefits through savings and it is also good for a company’s image with customers and stakeholders.

The report commissioned by Department for Environment Food and Rural Affairs (DEFRA) is likely to give further weight for the mandatory reporting of GHG.

The research carried out by PricewaterhouseCoopers and the Carbon Disclosure Project surveyed over 150 companies.

The research found that businesses who voluntarily report emissions used the results to inform business plans at board room level and additionally found that the process encouraged interest and behaviour change across the organisation.

Around 14% of the companies who were willing to give details said they made energy savings in excess of £200,000 per annum.

The cost to companies in reporting and measuring emissions was found to be between £50,000 and £450,000.

Over 50% of the companies surveyed have annual measurement costs of less than £50,000 and a further quarter have costs between £50,000 and £100,000. The highest total cost of measurement stated was £450,000.
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Specific costs associated with external GHG emissions reporting were generally slightly lower than measurement costs.

Around 40% of companies quoted costs of less than £25,000 for reporting, with a further 25% stating costs between £25,000 and £50,000. Just fewer than 20% stated costs from £50,000 to £100,000 and the maximum cost stated was £400,000.

Environment Minister Lord Henley said: “I am pleased to see that the many companies already voluntarily involved in reporting GHG emissions are finding the process beneficial to their business and investors.

“I am also delighted to see that the act of reporting is encouraging attempts to reduce emissions.

“The next steps for Government will be to consider the findings of the report. We’ll be announcing a way forward in early 2011.”

The Institute of Environmental Management (IEMA) has been calling for the introduction of mandatory GHG reporting. In October it issued a report on this subject, with 80% of members calling for the introduction of mandatory reporting.

They say reporting enables companies to move from seeing the environment as a bolt on to integrating it into the way they do business.

IEMA executive director of policy, Martin Baxter said: “Those businesses that publicly report on their greenhouse gas emissions are more ambitious and likely to want to become carbon leaders, moving beyond achieving legal compliance towards low carbon leadership. ”

However, 78% of FTSE listed businesses are failing to report data on their greenhouse gas emissions, therefore missing out on these vital business and environmental benefits.

Martin Baxter said: “Government needs to act now to introduce mandatory GHG reporting to ensure that UK businesses gain the benefits from embedding sustainability into their corporate strategy,”

“Government has the evidence base to act now to make reporting on GHG emissions mandatory.

“Mandatory reporting is essential as it will create a consistent and clear framework to enable businesses to plan and benefit from GHG emissions reductions.”

The government will be announcing a decision on how it intends to proceed with mandatory GHG reporting early in 2011.

Alison Brown