Accounting for carbon emissions Kevin Misselbrook Customer Services Director, Access Accounting Ltd

Why is the Green Agenda important to my business ? Cost-saving efficiencies CSR Compliance Business sustainability

Cost-Saving Higher cost of carbon usage Tax burden You can’t manage what you can’t measure Good measurement highlights awareness throughout the organisation

CSR Corporate and Social Responsibility CSR reporting requirements Customer attraction Suppliers Investor awareness and ….

Will day slide ? Moral duty ?

Stern Review Overwhelming evidence of climate change Impact : loss of between 5% - 20% of GDP each year ! Cost of controlling – as little as 1% of GDP “The costs of stabilising the climate are significant but manageable; delay would be dangerous and much more costly”

Supply Chain Pressure

Compliance Climate Change Bill – “Cascade” effect on supply chain Climate Change Levy Carbon Trading Schemes (expanding) ISO – Environmental standard for businesses – ISO – Carbon Reporting

Compliance More legislation ? Dept of Energy & Climate Change – (Oct 08) Audit standards – Carbon Trust, IAASB Government standard to be provided by Oct 2009 Companies Act changing by 2012 – mandatory reporting

Sustainability Need to have a business model that operates in a carbon-efficient world Establish strategies for the future Build a sustainable energy-efficient business

Measurement

CO 2 – The business issue Business Advantage Driving Customer Choice CO2 Taxation Possible Legislation Business Advantage MeasurePlan Take Action DEFRA conversion tables CO2 trapped in core – NL No extra cost or complexity

Improvement Cycle

Carbon Measurement Expensive Difficult Process-intensive Availability of results limited Difficult to get Actual vs Budget

Methodologies LCA – LifeCycle Assessment Modelling tool Good for counting product CO2 cost BSI PAS 2050 launched 29 th October 2008 – Defines the method and approach to LCA calculations

36 pages of guidance !

LCA Assessment

Methodologies LCA On line calculators

Methodologies LCA On line calculators Carbon Audit (3 rd party) Company Modelling tools Integrated within the Accounts function

Solution from Access

Embodied within the finance system Minimal additional keystrokes to collate carbon data Real time reporting – By Division, Cost Centre, Individual Actual vs Budget Short learning curve for staff

Why manage carbon emissions? Cost savings to the company Meeting corporate social responsibilities Attractiveness – to customers – to employees – To investors Compliance

Driven by DEFRA tables Follows GreenHouse Gas protocol The only solution integrated within the accounts system Affordable to SMEs Accounting for Carbon Emissions

Key Standards Used GreenHouse Gas Protocol Scope 1 – Direct production of CO2 emissions Burning fuel in transport, Chemical process release, creating electricity Scope 2 – Indirect use of power Scope 3 – Other indirect carbon 3 rd parties, supply chain etc etc

Key Standards Used Defra Tables – Sets out UK standards for CO2 calculations

Key Standards Used

Development Strategies LCA, Corporate Footprint, or both ?

Any Questions ?