The accounting profession, along with many others, will have a pivotal role in carbon accounting.
Given the significant threat of climate change, the wider the reach of carbon reporting, the better. Carbon reporting can highlight areas of organisational activity that are resulting in particularly high emissions and organisations can be surprised about what they discover – for example, Wal-Mart completed a return on emissions and was horrified at its level of GHG emissions. This caused it to look at its supply chain and to take action that both reduced costs and emissions.
ACCA remains certain that the accounting profession’s most significant contribution – and one of the most influential for the business world – would be for its own accounting standard-setter body to publish a carbon accounting standard. Environmental regulators should work with accounting standard setters to develop a universally applicable climate change reporting and auditing standard for organisations of all sizes.
Carbon accounting and reporting is currently a voluntary activity, at present conducted only by a handful of corporates and according to a range of guidelines. For example, a report from the Ethical Corporation Institute, based on a survey of FTSE 500 companies, claims to have found 34 different carbon emission methodologies. This makes comparison difficult, if not impossible.
Ideally, all organisations will ultimately report on their GHG emissions. The challenge will be to achieve such reporting without creating an impossible regulatory burden for the smallest entities.
Given the significant threat of climate change, the wider the reach of carbon reporting, the better. Carbon reporting can highlight areas of organisational activity that are resulting in particularly high emissions and organisations can be surprised about what they discover – for example, Wal-Mart completed a return on emissions and was horrified at its level of GHG emissions. This caused it to look at its supply chain and to take action that both reduced costs and emissions.
ACCA remains certain that the accounting profession’s most significant contribution – and one of the most influential for the business world – would be for its own accounting standard-setter body to publish a carbon accounting standard. Environmental regulators should work with accounting standard setters to develop a universally applicable climate change reporting and auditing standard for organisations of all sizes.
Carbon accounting and reporting is currently a voluntary activity, at present conducted only by a handful of corporates and according to a range of guidelines. For example, a report from the Ethical Corporation Institute, based on a survey of FTSE 500 companies, claims to have found 34 different carbon emission methodologies. This makes comparison difficult, if not impossible.
Ideally, all organisations will ultimately report on their GHG emissions. The challenge will be to achieve such reporting without creating an impossible regulatory burden for the smallest entities.
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