Avoid reporting pitfalls – follow Carbon Smart’s top tips for time efficient greenhouse gas disclosure

More frequently than ever, sustainability metrics are a feature of business decision making from a strategic, financial and reputational perspective. Whether for voluntary or compulsory purposes, greenhouse gas reporting is increasing.

However, increased reporting also means more public scrutiny.  Given the reputational risk, reporting organisations can ill-afford to get their environmental declarations wrong.  On the other hand, those responsible for sustainability reporting (unlike those typically responsible for financial reporting) are often conducting multiple job functions; reporting may be just one facet of working life, which can divert much needed resource away from the real task at hand; sustainability action.

Carbon Smart have worked extensively with organisations reporting both voluntarily and for compliance purposes and we know that time committed during reporting preparation and other key moments in the journey pays dividends.  Follow our top reporting tips to get your data in line, on time.

1.       Know your conversion factors from the beginning, start by reading the guidance in Defra’s frequently used conversion factors at: www.ukconversionfactorscarbonsmart.co.uk/

Defra’s conversion factors have undergone a complete overhaul for 2013.  Some organisations using the Defra conversion factors will need to rebaseline their data to align with the new approach so make sure your organisation is prepared for the adaptations that will be required.

 2.       Take time to fully understand your organisational boundary: clear definition up front improves consistency and ensures relevance down the line

Many organisations struggle to report consistent results year-on-year because their organisation has a complex structure and each year best data collection endeavours cover different subsidiaries, brands or operations.  Clearly understanding what you should and are including within scope (or need to include in terms of regulatory reporting) can significantly reduce confusion later on.

3.       Establish your reporting protocol to enable transparent and consistent calculation methodologies

Without clear, transparent documentation of reporting methods, organisations small and large may struggle to replicate and align calculations across different business divisions or between years.  Organisations seeking external assurance for carbon data may enjoy an easier assurance audit if the clarity and transparency of their processes is documented and adhered to.

4.       Collect data early, and regularly, it pays dividends in terms of the completeness and accuracy of reporting

It goes without saying really, but the sooner your data collection begins the sooner it will end and there will be plenty of time to ask questions, sanity check increases and decreases in data and generally make sure your reporting is accurate.  Hasty data collection and calculation can leave reporting littered with assumptions or even errors; this might mean complex data restatements in future and dilution of the integrity of your sustainability messages.

 5.       Push for high quality data (i.e. direct fuel usage over distance travelled or spend data) this reduces the need for assumptions in calculations and ensures reporting accurate enough to inform business action

Whilst time is rarely a luxury in reporting, making sure that the data you request / collect is of the best quality available can make the difference between business action and inaction.  GHG reporting based on spend information for example will need to be extrapolated to calculate emissions, this may undermine confidence in decisions based on the reporting.  Calculations based on primary data will be viewed as more reliable.

 6.       Communicate widely and frequently to ensure reporting turns into action rather than accountancy

A frequent pitfall for organisations is reporting their sustainability data quietly and neatly in a subsection of their annual report without engaging with investors, employees and other important stakeholder groups.  Make the most of all the time and effort committed to reporting, by communicating at every available opportunity and engaging your whole organisation in the sustainability journey.

Getting all these things right means your readers will understand your achievements better; their attention will be focused on your results not the shortcomings of your reporting.  Getting them wrong risks the reporting being the story, not the report.

Keeping up to date with the rapidly moving reporting landscape is difficult, but a little more preparation would certainly, in our experience, stand most organisations in good stead.

Julie Emmings, Senior Consultant said, “At Carbon Smart we make sure to follow our own tops tips with each of our reporting organisations.  The launch of the new Defra conversion factors, for example, has wide ranging impacts on all of our clients.  Our current focus is on taking the time to brief clients on the changes that need accommodating over the next reporting cycle and helping them understand how to communicate these changes to stakeholders. Our clients will benefit greatly from this level of preparation (as well as the simplifications to the new Defra conversion factors) in the future.”

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