introduction to ghg reporting and sustainability strategy
DESCRIPTION
GHG Reporting offers an opprtunity to combine the organisations need to be compliant with creating a beneficial sustainability strategy. What is GHG reporting and what benefits are there from a strategy?TRANSCRIPT
Your Green Journey
Rue Stanley
October 16th 2012
Greenhouse Gas Emissions Reporting- Kick start Your Sustainability Program
Agenda
• Introduction
• Greenhouse gas reporting: the start of a “Bigger” plan?
• What to measure
• The opportunity
• Why and how to implement a strategy
• Compliance and greenhouse gas emissions reporting
• About Ecobusiness Exchange
Ecobusiness Exchange Ltd October 2012
Introduction • In June 2012, Nick Clegg Deputy PM announced new legislation requiring LSE UK main
market listed companies to report their greenhouse gas emissions(GHG). This legislation will be effective in 2013, and is in addition to existing legislation such as the CRC- carbon reduction energy efficiency scheme that requires over 2000 companies to report their energy emissions.
• The GHG legislation will affect over 1000 companies, a number of whom are not reporting their emissions under other legislation. Defra is considering extending the legislation to all quoted companies by 2016. Those who sell to affected companies are likely to receive information requests sooner than 2016 from their supply chain.
• 60%* of listed companies are reporting environmental, social and governance strategies and action in their annual reports and some are taking actions that: reduce emissions, costs and risk, create new products, engage employees and increase investor confidence.
• This is an opportunity to use the need for compliance to kick start a more proactive approach to sustainability- the new legislation will bring sustainability issues to the board’s attention. GHG reporting will need resourcing and funding. Rather than a burden on business, its better if the process can generate bottom-line benefits.
• Compliance with the legislation alone will not generate benefits- to achieve benefits- organisations need to decide on a strategy and take action
Ecobusiness Exchange Ltd October 2012
* Source: Defra
Reduce Costs & Emissions
Ecobusiness Exchange Ltd October 2012
Marks & Spencer Plan A savings
23 companies join KKR’s Green Portfolio program & make $365m savings
The printing industry spends about £67 million on energy bills every year in the UK, resulting in an estimated 2 million tonnes of CO2 emissions. The Carbon Trust estimate that the sector could cut its energy bills by 15% through basic energy saving measures. For every 1ºC that you overheat your premises, you add 8% to your heating costs. (The maximum recommended temperature is 19º.) A single computer and monitor left on 24 hours a day will cost over £50 a year. Switching it off out of hours and enabling standby features could reduce this to £15 a year each and prolong the lifespan of equipment. Report by The Carbon Trust
Opportunities
Ecobusiness Exchange Ltd October 2012
Unilever Wash at 30° Product innovation and environmental good
Green Data Centres
Power generation: 100MW installed capacity
NISP: one mans waste is another’s product www.nispnetwork.com
A Bigger Plan
Ecobusiness Exchange Ltd October 2012
Institute for Sustainable Development
www.iisd.org
Strategy Communicate to stakeholders and increase shareholder value
• A survey of more than 300 financial experts in Europe, carried out at the end of 2001, has revealed a high degree of confidence in socially responsible investment (SRI). Eighty-six percent of respondents said they believed social and environmental risk management would
have a long-term benefit for a company's market value. http://www.iisd.org/business/banking/sus_survey.aspx
Ecobusiness Exchange Ltd October 2012
Design
Ecobusiness Exchange Ltd October 2012
The UNGlobal Compact Strategy Blueprint provides a framework for executing a sustainability program in line with the Ten Principles of the UNGlobal Compact. The UNGlobal Compact has 8700 members, of which 6000 are private and publicly owned enterprises report their performance to the UNGlobal Compact on an annual or biannual basis. Questions relating to the UN Global Compact frequently appear as part of the procurement process www.unglobalcompact.org
Social Responsibility
Products
Employees suppliers investors
Operations
Risk Management
Compliance
Staged Approach: Much More than Compliance
The Green Journey ™
Every Journey Starts with a Single Step
Regulatory Compliance
Risk Management
Increase, manage and measure operational efficiencies own, &
across value chain
CEO + board commitment & leadership
Transparency & disclosure
Robust management procedures & policies
Mainstreaming into corporation
Encourage employee sustainable thinking & work practices everyday. Deliver stakeholder transparency &
responsibility
Embed into product Innovation Reduce negative and increase
positive impacts across the value chain
Social Investments & philanthropy Partnerships &
collective action
Ecobusiness Exchange Ltd October 2012
Join The Leaders
• http://www.youtube.com/watch?v=t9Fxp3HK6DI
Ecobusiness Exchange Ltd October 2012
GHG Emissions Reporting
• On June 20th At the Rio +20 UN Conference on Sustainable Development, Nick Clegg, Deputy PM announced the introduction of mandatory greenhouse gas reporting for listed companies to be affective from April 2013.Initial press reports were confusing, referring to FTSE companies or quoted companies and the number of companies affected as 1600
• Draft regulations have been published and a Defra consultation commenced on July 25th which closes on the 17th October 2012.The consultation will finalise aspects of the legislation, including the effective date which will be either from April 7th or October 2013
• In 2013 approx 1000 companies will be required to report emissions from the period covered by their annual report
• The legislation affects LSE Main Market UK owned listed companies and includes all the entities and businesses under financial or operational control in the UK and internationally
Ecobusiness Exchange Ltd October 2012
GHG Reporting Support
• Business groups such as the CBI and Aldersgate Group have been supportive of the legislation and have been lobbying for a level playing field for environmental reporting for a number of years supported by business leaders:
"The CRC has become a tax that pretends to be green and does nothing to strengthen the business case to invest in energy efficiency," said Rhian Kelly, the CBI's director for business environment policy.
"We urge the Government to recognise that this policy is past the point of no return - it should be scrapped, and its reporting elements replaced with mandatory carbon reporting.“
• A report from Grant Thornton UK LLP released on the 12th October shows that 67
per cent of UK mid-sized firms include sustainability information in some form of external reporting
• http://www.businessgreen.com/bg/news/2184550/cbi-demands-formal-review-green-taxes
Ecobusiness Exchange Ltd October 2012
GHG Reporting, in Brief
• Report to be included in narrative of annual report, and enforced under section 456 companies Act 2006, Directors responsibilities
• Report greenhouse gases( GHG) from fuels combustion, owned transport, process emissions, fugitive emissions, indirect/purchased energy
• Report GHG from all locations; UK & international owned/controlled by the company
• Establish a baseline: all locations and sources year 1
• Companies can choose methodology and intensity metrics
• New requirement, in addition to the Carbon Reduction Efficiency Scheme(CRC)
• Effective immediately legislation approved- October or April 2013
Ecobusiness Exchange Ltd October 2012
What to Measure
Ecobusiness Exchange Ltd October 2012
• Defined by the Kyoto Protocol
• Defra defined scopes 1 & 2
Greenhouse gases
• Owned transport, Fuels combustion
• Process emissions, fugitive emissions
Scope 1: Direct
• Energy : consumption of purchased electricity, heat steam and cooling
Scope 2: Indirect
GHG Sources
Ecobusiness Exchange Ltd October 2012
• Carbon Dioxide; methane; nitrous oxide;hydroflurorocarbons;perflurorocarbons; sulphur hexafluride converted into CO2 equivalent
Greenhouse gases
• Owned transport: includes travel from company cars and owned vehicles, excludes travel from other means- personal vehicles and business travel planes, trains etc
Scope 1: Direct
• Energy : consumption of purchased electricity, heat steam and cooling – from all locations in the UK and internationally under company control
Scope 2: Indirect
In Summary • Affects Main Market listed companies from April or October 2013
• Report Material Scope 1 and 2 emissions from all six greenhouse gases
• Companies will have to report across the same boundary: entities and locations as defined in the annual report and prepared for the same period as the annual report
• Emissions data will be required to be included in the narrative section of the report and signed off by directors and auditors
• Companies can choose a base year to report against in future years: this will provide challenges to organisations as they change acquire merge or divest
• Companies will be required to state the methodology or framework used to calculate emissions and choose an intensity metric. For example: headcount, revenue or units of production
• Companies will be allowed to include data from their other reporting obligations such as the CRC, EU ETS and Climate Change agreements
Ecobusiness Exchange Ltd October 2012
Implementation
Reporting Boundary
Identify emissions
Method & Metrics
Data Collection Systems & Processes
Analysis & Report
Ecobusiness Exchange Ltd October 2012
Budget & Ownership
Software Selection
Annual Report Deadline
Bring in the Experts?
Next Steps If your company is UK headquartered and is LSE Main Market listed, then this reporting requirement applies once the legislation has been approved for April or October 2013. Research best practice, or speak to an expert: • Define your sustainability direction and strategy • How can your program deliver benefits or be cost neutral? • Investigate International greenhouse gas reporting best practices • Evaluate software: speciality software provides a resource efficient, accurate and
auditable way of managing data • Choose the intensity metrics: that are meaningful to stakeholders • Set up data collection and reporting process • Prepare and stay updated, future reporting requirements are likely to include
waste and water
Not affected immediately? Start your sustainability program now, reduce emissions, costs and increase advantage
Ecobusiness Exchange Ltd October 2012
About Ecobusiness Exchange
We can advise you on creating and implementing your sustainability approach and offer practical help in meeting the new requirements for greenhouse gas emissions reporting. Sustainability as a Service launched in 2012 offers a modular approach to delivering all aspects of sustainable business. For more information please contact: Rue Stanley E: [email protected] T: 01737 214364 www.ecobusiness-exchange.com Blog: Top Ten Tips on GHG Reporting http://www.ecobusiness-exchange.com/toptentipsemissionsreporting/
Ecobusiness Exchange Ltd October 2012
Program Design
Delivery
Communications
Systems & Processes
Software
Resource Efficiency
Energy
waste
Governance
Greenhouse gas emissions reporting
Policy & voluntary reporting
Sustainable Strategy
Design & communication