Thursday 21 June 2012

Cautious welcome for carbon reporting from its champions

Plans to make all firms listed on the London Stock Exchange report on their greenhouse gas emissions have received a cautious welcome from one of its main backers.

Business lobbying group the CBI has vocally campaigned for blanket carbon reporting to give companies an even footing. It said the regulation must be done “sensibly”.

This morning the Department for Environment, Food and Rural Affairs (Defra) unveiled plans for more than 1000 public companies in the UK to compulsorily publish their emissions data.

Rhian Kelly, CBI Director for Business Environment policy said: “It is an important way to help businesses save money and emissions. Provided this is done in a sensible way, this announcement is to be applauded.”

She said the Government must go one step further and scrap the Carbon Reduction Commitment (CRC), which is effectively a tax on firms’ emissions, “to avoid unnecessary duplication”.

Analysts say the reporting shouldn’t cause “undue burden” for businesses.

"For most major companies, the introduction of mandatory reporting will not create an undue burden, as many are already voluntarily disclosing their carbon emissions,” said Doug Johnston, leader of Ernst & Young’s Climate Change and Sustainability Services practice.

However he also suggested “overlapping” regulation might give businesses clamouring for “clarity” pause for thought.

Environmental campaigners said the plans are a “positive step” but thought they should cover more businesses.

David Nussbaum, Chief Executive of WWF-UK said: “It’s encouraging that the Government has gone for a mandatory approach, though it is slightly surprising that the Government didn’t extend this to all large companies as the overwhelming business response indicated that they should.”

However questions remain about how it will be enforced and how keen larger multinational firms will be to fall in line.