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Increasing numbers of organisations are either being required to, or are voluntarily opting to calculate their greenhouse gas emissions. This means that they’re armed with the information needed to implement sustainability measures to reduce their carbon footprint.
Transparency and communication with stakeholders is a crucial component of any organisation's net zero journey - this means that not only should an organisation communicate their final carbon footprint result, but they should also communicate any changes in the interim. So what are the best practices for communicating changes to your GHG results?
👉 In this article we’ll cover the scenario where an organisation has already carried out a greenhouse gas assessment (GHG assessment), but their results have changed in the interim and they now want to communicate these changes.
First up, to provide a bit of context, let's quickly go over what a GHG assessment is and what it is used for.
An organisation may be required by law to carry out a GHG assessment, however it’s often something that companies voluntarily opt to do as it provides the opportunity to identify carbon emission reduction opportunities, to showcase their commitment to reducing their environmental impact, and to take part in voluntary GHG programs such as the ISO certifications.
In the United Kingdom for example, under the SECR, larger companies (companies listed on a public exchange, large unquoted companies, and large LLPs) must report on their energy use and carbon emissions (scope 1 and 2).
Currently in the US, the GHGRP (Greenhouse Gas Reporting Program) requires certain organisations who are classified as being large GHG emitters, to provide an annual report on their GHG emissions. However, reporting obligations are set to expand: not only did the Biden-Harris Administration recently propose the introduction of new regulations that would require major Federal contractors to disclose their GHG emissions, the SEC has also proposed rule changes that will enhance and standardise climate-related disclosures for investors.
In Europe, the European Union introduced the Corporate Sustainability Reporting Directive (CSRD), which requires all large companies and all listed companies to disclose information on the risks and opportunities arising from social and environmental issues, alongside disclosure of their carbon emissions. Individual EU countries may also enact their own reporting requirements nationally.
An organisation may need to carry out a GHG assessment In order to meet the demands of mandatory reporting requirements, to achieve a voluntary certification, or simply because a company wishes to reduce its carbon emissions.
Whatever the reason, carbon accounting is the first step in carrying out this assessment. Carbon accounting is the process of measuring the amount of GHG emissions a company is responsible for. This helps a company to understand which activities are the most carbon intensive and therefore allows them to establish a strategy to reduce their emissions in the longer term.
Carbon accounting can be complex and time-consuming, this is why companies specialising in carbon accounting - like Greenly - are a great way to accurately measure carbon emissions and monitor emissions in real time.
It’s not unusual for a company who has previously carried out a GHG assessment to find itself in a situation whereby the results have changed. There are a number of reasons for this:
Depending on the industry, organisation, and company activities, it can be difficult to obtain all the information required to complete a carbon assessment with 100% accuracy. The complexity of the task means that despite best efforts data may be missing or inaccurate. For example, your organisation may not have access to tenant utility data one year, but develop a landlord-tenant data sharing practice the following year to improve the reporting.
There are two main methods used to calculate carbon emissions. The first is the spend based method which works by taking the monetary value of a purchased good or service and then multiplying this value by a relative carbon emission factor, in order to calculate the amount of greenhouse gas emissions produced.
The activity based method on the other hand uses data to establish the exact units of a certain material or textile that a company has purchased. This means that it provides a more accurate carbon assessment than the spend method, however, it’s also more time consuming and complex.
It’s possible that a company calculates their carbon emissions using the spend based method in the first instance (or a hybrid version), and then later decides to re-calculate emissions by conducting additional activity based studies for its biggest emission sources to increase the precision of their report.
To read more about these two different carbon accounting methodologies and Greenly’s preferred approach, check out our article on the topic.
Another example of a scenario where a company may wish to update its GHG results is where the scope of the emissions is expanded.
Scope 1 and 2 emissions are the most common emissions categories, and some companies choose to focus on these alone, leaving out scope 3 emissions (often regulatory reporting requirements cover scope 1 and 2 only). However, since scope 3 emissions cover a company’s value chain, these emissions account for an average of 75% of a company’s GHG emissions, which means that by omitting scope 3, it’s impossible to paint the whole picture.
In these scenarios an organisation may therefore choose to re-calculate its emissions - this is something that Greenly can help with. Our climate experts and state of the art technology allow us to provide clients with fast and accurate carbon assessments.
Our team also has the expertise to help you implement a plan of action to kick start your net zero journey.
To find out more about how Greenly can help, why not book a commitment free demo with a member of our team.
When a company chooses to re-do its GHG assessment, how should it communicate these changes? We’ve laid out a few best practice principles for organisations to keep in mind:
One of the most important elements of communicating any changes in GHG assessment results, is to be completely transparent. This means providing sufficient detail and explaining where the changes come from. Transparency should be the golden rule when it comes to communicating on anything that concerns emissions or the environmental impact of an organisation.
It’s important to be upfront and clear about the emissions scope of the GHG assessment. Be specific about what segments of the organisation the assessment covers, and what emission scopes or categories are included or excluded - for example if only scope 1 and 2 emissions are covered by the assessment this should be made clear, and it should be clearly communicated that scope 3 emissions are excluded.
Outline the methodology used to calculate the organisation's emissions (for example ISO 14 064, GHG Protocol, Bilan Carbone etc).
Communicate the plans for the organisation with regards to emissions over the coming year. For example, are there any plans to improve on emissions reporting methods, or data sources? If the company previously made estimates based on industry averages due to missing data, but intends to leverage new data in the future, it may be beneficial to inform your audience about these upcoming plans and the resulting potential changes to your historical GHG results.
Keeping track of carbon emissions is an ongoing process. Organisations should continuously look for ways to improve the accuracy of their emissions data in order to increase the accuracy of their carbon footprint. This gives an organisation the best fighting chance of reducing their carbon emissions and improving their sustainability.
It’s also important that organisations look to maintain open and transparent communication when it comes to their carbon footprint. This means that not only should they communicate their final result, but that they should also be transparent when it comes to the processes they follow to calculate emissions, as well as any changes in their results or scope. By fostering an open line of communication with stakeholders, organisations can maintain good relationships and ensure that they’re abiding by regulatory reporting requirements.
At Greenly we can help you to assess your company’s carbon footprint, and then give you the tools you need to cut down on emissions. Why not request a free demo with one of our experts - no obligation or commitment required.
If reading this article has inspired you to consider your company’s own carbon footprint, Greenly can help. Learn more about Greenly’s carbon management platform here.
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