Decarbonisation is a recurring topic on the agenda of large organisations.
The 28th Conference of Parties (COP28) has recently concluded in Dubai and one of the key issues on the table was how do World Governments try to find an agreement to reduce carbon emissions?
Clearly Governments across the World are challenged with the task of reducing emissions and this challenge will inevitably be passed on to the industry that is accountable for around 1/3 of all world emissions.
The first step in decarbonisation is the quantification of the emissions associated with a company’s activity.
These are defined as scopes 1 to 3. Scope 1 encompasses direct emissions from owned or controlled resources such as company vehicles and manufacturing activities; scope 2 includes indirect emissions from utilities used on site such as electricity, steam, heating and cooling and scope 3 incorporates all other indirect emissions such as business travel, supply chain and end-of-life impact of sold products.
Once the emissions are quantified, it is then possible to put in place measurable initiatives to reduce or offset these emissions.
The activity of measuring emissions is defined as Carbon Accounting and it is becoming clearer that this is an area of risk in compliance, management or corporate responsibility for businesses.
More specifically these risks can be grouped in key areas such as business reputation, data accuracy, compliance, competition, access to technology and business resilience.
Carbon Accounting is delivered by defining the inventory boundary of a business (i.e. what falls within scope 1, 2 and 3 of a company’s carbon emission), identify a reference year and updating its inventory on a regular basis, applying GreenHouse Gasses (GHG) principles and then manage the process over time.
There are frameworks in place that provide a protocol to quantify the emissions associated with activities falling in the three scopes.
Some of these protocols are described here:
3) ISO Standard 14064
4) The general reporting protocol
Companies will need to start choosing which one of these protocols they want to adopt to calculate their GHG impact.
At Watts-ON consultants we can see how this environmental reporting requirement will impact our clients in the very short term.
The priority of reducing carbon emissions will focus investment in activities or management decisions that have hitherto not yet been considered so far within a company strategy.
Carbon offsetting through reforestation, investments in renewable energy generation, identification of new suppliers with lower GHG emissions and certification of GHG in the business to report to clients in their scope 3 quantification are all aspects associated with upcoming carbon accounting issues.
A hotel-specific consequence associated with reporting on GHG and sustainability is discussed on one of the latest news feeds from Hospitality Insights.
In 2024 ESG (Environment, Social & Governance)reporting is expected to be a big financial issue for hospitality businesses.
This is because within the EU from next year it is expected that businesses in the hospitality sector will have to improve on their ESG and sustainability credentials to reduce credit charges on brown lending with the banking industry turning more in favour to fund ‘green assets’.
It is therefore time for hospitality businesses to come up with a plan and Watts-ON Consultants is well placed to support upcoming carbon accounting and ESG requirements.
Watts-ON, our on-line management platform, is the ideal tool to gather information and automate Carbon Accounting calculations using the chosen protocol.
Our expert consultants are also available to identify realistic and cost-effective routes for decarbonisation as well as support for building sustainability certification.