Mike Anderson, Director General of the Department for Environment, Food & Rural Affairs, said companies were “bonkers” if they weren’t already looking at carbon, as well as their use of water and other resources. Despite business, investor and public support for rules to make large or listed companies report on carbon, Defra could find it difficult to introduce the rules because of the Government’s arbitrary “one in, one out” rule – regulations with an equivalent cost to business would have to be slashed elsewhere to avoid adding to any overall regulatory “burden”.
Defra has to make the case for mandatory reporting based on an impact assessment that was widely criticized for over-egging the costs to business of measuring and reporting emissions, and for under-estimating cost savings that could result from carbon management. Colin Baines, Campaigns Adviser at The Co-operative Group, said that the costs of getting data and including it in annual reports were minimal.
It’s unclear how the Government would achieve a target to cut economy-wide emissions by 50% from 1990 levels by 2027 unless companies responsible for more than half of the countries emissions measure and report carbon. It’s the very least that they will need to do.
“Measuring and reporting is an essential tool,” said Andrew Raingold, Executive Director of the Aldersgate Group, which organised the event and backs the option to require all large companies to report emissions in their annual reports & accounts under the Companies Act 2006. What gets measured, gets managed.
The consultation closes on 5 July, so it should be clear by the autumn whether or not the Government is prepared to essentially do nothing under a voluntary framework, despite the clamor for mandatory carbon reporting to deliver consistent carbon data to investors and a level playing field for business.