Mandatory Greenhouse Gas Reporting in Company Accounts (UK)

The Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 (SI 1970) are here.

These Regulations are made under the Companies Act 2006, in force from 1st October 2013, and have effect for the financial year ending on or after 30th September 2013.

They amend the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008 (2008 SI 410) to require quoted companies to make certain disclosures regarding greenhouse gas emissions.

In particular, they insert into Schedule 7 of 2008 SI 410, a new Part 7 (after paragraph 14 of Schedule 7) that requires disclosure in the directors’ report for a financial year if the company is a quoted company –
– the annual quantity of emissions in tonnes of carbon dioxide equivalent from activities for which that company is responsible including—
(a) the combustion of fuel; and
(b) the operation of any facility, (paragraph 15(2)); and
– the annual quantity of emissions in tonnes of carbon dioxide equivalent resulting from the purchase of electricity, heat, steam or cooling by the company for its own use (paragraph 15(3)).

These disclosures are required only to the extent that it is practical for the company to obtain the information in question; but where it is not practical for the company to obtain some or all of that information, the directors’ report must state what information is not included and why.

The directors’ report must also state the methodologies used to calculate the information disclosed under paragraphs 15(2) and (3).

The directors’ report must also state at least one ratio which expresses the quoted company’s annual emissions in relation to a quantifiable factor associated with the company’s activities. (Paragraph 17)

NB: With the exception of the first year for which the directors’ report contains the information required by paragraphs 15(2) and (3) and 17, the report must state not only the information required by paragraphs 15(2) and (3) and 17, but also that information as disclosed in the report for the preceding financial year.

NB: The directors’ report must state if the period for which it is reporting the information required by paragraph 15(2) and (3) is different to the period in respect of which the directors’ report is prepared.