Government must act on “missing carbon millions”

    19 Feb 2007

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    The UK’s real impact on global warming has been massively underestimated because millions of tonnes of greenhouse gases produced by some of the UK’s top companies are not being declared, it has been claimed.

    According to the report Coming Clean: Revealing the UK’s True Carbon Footprint, published by Christian Aid, almost 200 million tonnes of CO2 greenhouse gas – equivalent to around a third of the UK’s currently declared annual emissions – is missing from the annual reports of major companies operating on the London Stock Exchange.

    These ‘missing millions’, claims the organisation, represent only a small fraction of total undeclared emissions.

    One estimate suggests that emissions associated with FTSE 100 company activity worldwide amount to 12-15% of the global total. This figure stands in contrast to Prime Minister Tony Blair’s assertion that the UK produces ‘only’ around 2% of the world’s carbon emissions.

    “Our research reveals a truly staggering quantity of unreported carbon dioxide is emitted around the world by the top 100 companies on the London Stock Exchange,” said Andrew Pendleton, Christian Aid’s senior climate change analyst. “And we don’t even know the extent of the emissions of many of the biggest companies.”

    Christian Aid found that only 16 out of the 100 companies on the FTSE 100 Index properly report their basic emissions according to established standards. If all members of the FTSE 100 applied these standards to their emissions reports, it is estimated that these companies would have to declare a further 190.65 million tonnes of carbon.

    Pendleton added:

    “The calculations we have made relate to basics, like offices and lighting, but take no account of investment or supply chains which is a much bigger area. The figures that companies currently declare are such a mess that it is impossible to calculate their total emissions.

    “That is why we need clear, reporting standards applied across the board. These guidelines exist already and the Government must now make them mandatory.”

    As part of its campaign, Christian Aid is calling on its supporters to write to Barclays Bank, Morrisons, International Power and the British Chancellor calling for companies to declare all emissions to an agreed standard and commit to reduce their emissions by 5% per year.

    Basic emissions reporting guidelines - backed by the Department for the Environment, Food and Rural Affairs - have been established for some time.

    In Workplace Law’s Energy Performance of Buildings 2006: Special Report authors Bernie Sheehan and Mick Dalton comment on Defra's guidelines, explaining, “the new generation of guidelines are designed to help businesses address their most significant environmental impacts and report on these in a way that meets the needs of their shareholders and other stakeholders. They outline how environmental impacts can be measured through Key Performance Indicators – in many cases making use of standard business data that may already be collected – and how to report them easily.”

    However, approaches to reporting can vary considerably. For example, Marks & Spencer declares 5m tonnes of CO2 emissions, more than twice as much as its larger rival Tesco. The discrepancy is down to the fact that M&S includes its global supply chain and its customers' journeys when calculating its carbon footprint and Tesco does not.

    Christian Aid is not the only organisation to highlight the issue of businesses failing to report their environmental impact.

    The Environment Agency has revealed four out of five of the first 100 companies in the FTSE All-Share to report under the Business Review requirement of the European Union Accounts Modernisation Directive have failed to disclose environmental performance indicators.

    Under the Directive large UK businesses are required to provide a Business Review, including information on environmental or employee matters to the extent necessary for an understanding of a company's development, performance or position. Medium private companies must also produce a Business Review, although they do not need to produce performance indicators relating to non-financial information.

    However, the annual report and accounts of 84% of FTSE All-Share companies have not yet disclosed their environmental performance - ignoring guidelines from the Department for the Environment, Food and Rural Affairs (Defra).

    Christian Aid’s report can be downloaded from:

    Workplace Law's Energy Performance of Buildings 2006: Special Report provides in-depth insight into the key requirements of energy efficiency legislation (such as Parts F and L of the building regs) and the practical measures needed to comply with the law. Written by researcher Bernie Sheehan and immediate past chair of the British Institute of Facilities Management, Mick Dalton, the report delivers a cutting-edge perspective on the law and practice of energy efficiency in buildings. more info>>

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