Defra is consulting on guidelines to help businesses that want to demonstrate their corporate sustainability credentials do it in a clear and concise way.

For the first time, guidance includes detailed advice on how firms can measure and report on their impact on wildlife and natural services such as clean air, clean water, food, timber, flood protection and welfare benefits.

Environment Minister Lord Taylor of Holbeach said:

“British firms are world leaders in understanding that improving the sustainability and resilience of their whole business is not only good for the environment but good for the bottom line too. This new guidance is another step towards our aim of corporate sustainability reporting becoming normal business practice by making it as simple as possible for companies to show their environmental impact.”

The proposed guidance will help companies to see where they can make savings in their business model. It will also help meet the increased interest from investors in environmental information that is relevant to investment decisions.

The guidance builds on the agreement at Rio+20 where British firms and Government helped secure international support to encourage businesses to include sustainability information in their annual reporting.

Lord Taylor of Holbeach also today announced further details on the new regulation announced at Rio+20 requiring all quoted companies to report their greenhouse gas emissions. A draft of the regulation has been published to update businesses on what will be required of them from April 2013.

Notes

The consultations on new guidance for corporate sustainability reporting and the regulation on reporting of greenhouse gas emissions are available here http://www.defra.gov.uk/environment/economy/business-efficiency/reporting

The proposed guidance shows businesses how they can measure and report on their performance in five areas – air quality and emissions, water, biodiversity and ecosystem services, natural materials and waste.

A quoted company is one that is UK incorporated and is listed on the main market of the London Stock Exchange.

The UK is the first country to make it compulsory for companies to include emissions data for their entire organisation in their annual reports.
The introduction of the reports, following consultations with leading businesses, will enable investors to see which companies are effectively managing the hidden long-term costs of greenhouse gas emissions. The majority of businesses responding to the consultation support the change and government plans are also backed by leading employer and environmental organisations including the CBI and the Aldersgate Group.

The new regulations will be introduced from April 2013.  They will be reviewed in 2015, before ministers decide whether to extend the approach to all large companies from 2016.

Greenhouse gases, such as carbon dioxide, nitrous oxide and methane are causing climate change leading to global temperature increases, sea level rises and dangerous changes to patterns of drought and flooding. More than 30 billion tonnes of CO2 are emitted globally each year by burning fossil fuels and the concentration of CO2 in the Earth’s atmosphere is now higher than at any time in at least the last 800,000 years. The UK is committed to cutting UK carbon emissions to 50% of 1990 levels by 2025.

Reporting is the first vital step for companies to make reductions in these dangerous emissions. It is estimated it will save four million tonnes of CO2 emissions by 2021.

Deputy Prime Minister, Nick Clegg said:

“Counting your business costs while hiding your greenhouse gas emissions is a false economy.

“British companies need to reduce their harmful emissions for the benefit of the planet, but many back our plans because being energy efficient makes good business sense too. It saves companies money on energy bills, improves their reputation with customers and helps them manage their long-term costs too.

“Climate change is one of the gravest threats we face. The UK is leading the urgent action needed at home and abroad.”

Secretary of State for the Environment, Caroline Spelman said:

“The discussions we’ve had with businesses show that they want to cut down their greenhouse gas emissions, and they want to be open and transparent about it. What they have asked for is a level playing field so that they can be fairly judged against one another, and we have delivered that today.

“Investors are now looking hard at the green credentials of businesses, and the reporting of green house gas emissions will give them vital information as they decide where to invest their money.”

Secretary of State for Department of Energy and Climate Change, Edward Davey said:  

“Energy efficiency is a no brainer. It saves money for businesses whilst cutting carbon to help us meet our climate targets. The introduction of mandatory reporting will build on the regulatory framework established by the CRC Energy Efficiency Scheme for the largest energy users.”

Andrew Raingold, Executive Director for the Aldersgate Group, said:

“The vast majority of businesses strongly welcome the introduction of mandatory carbon reporting. This is an area where corporate executives have been demanding more regulation from government to provide greater clarity and transparency.

“Our detailed analysis demonstrates that this announcement will lead to huge cost savings for businesses as opportunities to reduce their energy use become more apparent. Over three quarters of UK adults expect that businesses should be required to report their emissions, as demonstrated by a Populus poll that we published last month.

“This statement should pave the way to extend the requirements to all large companies in due course and demonstrates genuine UK leadership at the Rio+20 Earth Summit.”

The decision follows the consideration of extensive evidence and the detailed analysis of consultation responses to gain the views of businesses and individuals, the majority of which opted for a mandatory reporting approach.

Businesses said a compulsory approach would:

• Provide the first step in enabling companies to manage and reduce emissions;
• Mean more transparency from companies;
• Provide a single consistent standard; and
• Provide information to the business that could save them money through reduced energy costs.

Notes

Further information on greenhouse gas reporting can be found at http://www.defra.gov.uk/environment/economy/business-efficiency/reporting/.

Agriculture contributes about eight per cent of all UK greenhouse gas (GHG) emissions. But the way farming emissions are calculated fails to take into account the differences between different farming practices or the effects of innovative approaches and new policies that aim to reduce GHG emissions. This research will help us to understand these differences and give farmers the evidence needed to take more effective steps to reduce emissions.

Speaking at Crop World 2010, Jim Paice said:

‘Tackling climate change is a priority as we work towards being the greenest Government ever. This investment demonstrates our commitment to supporting the agricultural sector as it faces the challenges of reducing greenhouse gas emissions.

‘Farmers are already taking action to reduce their impact on climate change and this £12.6 million investment in world class research and development will enable us to understand which measures are having the biggest impacts.’

The current method for calculating agricultural emissions uses a simplified approach, which is the minimum required by the United Nation Framework Convention on Climate Change (UNFCCC) for the UK National Inventory. This approach relies on generic emissions values and on national statistics such as livestock numbers and tonnes of fertiliser used.

The £12.6m will be invested over four and half years in a series of projects that aim to strengthen our understanding of emissions produced on farms. For example, it may show that applying fertiliser to certain crops at different times may reduce nitrous oxide emissions. Or that some livestock breeds produce less methane than others under different farming systems. Knowing when and where actions make the most difference will improve the positive actions that farmers are already taking.

Sixteen research organisations from across England, Wales, Scotland and Northern Ireland will contribute to the project, managed by Defra.

Notes

• The £12.6m funding for this new project has come from Defra’s existing budget on Farming and Food Science, and includes contributions from the Devolved Administrations.
• From 1990 – 2008, the agriculture sector accounted for:
  76 per cent of UK nitrous oxide (N20) emissions, mainly from the use of nitrogen fertilisers
  38 per cent of the UK’s methane (CH4) emissions, mainly from the digestive systems of livestock and from manure
  1 per cent of the UK’s carbon dioxide (CO2) emissions
  (from 2010 DECC publication of GHG emissions)
• The English agriculture industry published its GHG Action Plan in February 2010, making a firm commitment to reduce greenhouse gas emissions by 2020. The industry will shortly publish a delivery plan, outlining the activities that will translate into practical actions.
• The first phase of investment will focus on improving accuracy and resolution of current emission factors through three closely-linked projects:
  • Data management and modelling – bringing existing data together to create a new inventory model and a set of revised emission factors with an assessment of uncertainty.
  • Methane (CH₄) emissions – discrimination between CH₄ missions from different livestock species and breeds/genotypes under different farming systems and representative farm business structures.
  • Nitrous Oxide (N₂O) emissions – understanding N₂O emissions as a function of N inputs through time, influence of climate, crop, soil types and conditions, and land management under different farming systems and representative farm business structures.

The Agricultural Advisory Services Analysis Report assesses the different ways that farmers are given advice and how effective these methods are at achieving behaviour change. It recommends using existing advisory channels, following a tiered approach. This approach starts by capitalising on public services, such as the English Catchment Sensitive Farming Deliver Initiative, then mobilising private and third sector services, for example by working with industry bodies and membership organisations; and finally by supporting independent advisers to deliver this advice.

The report is available on the Defra website, at  archive.defra.gov.uk/foodfarm/landmanage/climate/documents/advisory-analysis.pdf