By David York, head of auditing practice, ACCA
‘You can’t manage what you don’t measure’; so is that why ACCA has issued Technical Factsheet 190 Carbon accounting for small businesses? To give accountants the tools to help smaller businesses measure their outputs of greenhouse gasses. So they can manage them – reduce them – and help ‘save the planet’.
Partly. Plenty of organisations have been trying to make measurable and reportable the environmental (and other) impacts of business. But almost without exception, these initiatives have been aimed at, and only been taken up by, large corporations.
There is nothing wrong with that. ACCA has been prominent in promoting sustainability reporting and now integrated reporting for giant businesses for which measurable reductions can make significant contributions to reducing global warming. But more can be done.
These existing initiatives are not readily scalable down to very small businesses. The GRI G4 Sustainability Reporting Guidelines for example have over 90 pages and are issued with a 260-page implementation guide. The authoritative Greenhouse Gas Protocol corporate standard is over 100 pages.
In complete contrast, the essence of the ACCA guidance is contained in ten pages. It does this by introducing a simple form of carbon accounting. The simplification comes primarily from narrowing down the scope of reporting to concentrate on common businesses’ activities that have significant measurable emissions, typically energy use and transport.
This makes it potentially accessible to all, so that businesses are not deterred by either the amount of time it will take to complete the carbon accounts or the complexity of the process. The guidance has been developed in conjunction with Green Accountancy, an ACCA registered practice that successfully provides this service in the UK.
The factsheet explains the form of reporting, provides a methodology, and sets out ‘conversion factors’ – the means to convert physical measures, such as electricity used, into a carbon equivalent. Guidance is also provided on the relevant professional responsibilities, such as a suitable engagement letter, and on marketing this new service.
Marketing has a sting in the tail. The client must have trust in a firm’s ability to provide the service. There are many ways to build that trust, but there is one sure way to destroy it: unless a firm ‘practices what it preaches’ and does its own carbon accounting, it will have no credibility.