How to get your organisation ready for mandatory climate reporting - 100% Renewables

How to get your organisation ready for mandatory climate reporting

In this article, we’re focusing on getting your organisation ready for the growing demand for climate-related information, even if you’re starting from scratch.

Join Barbara Albert, our Co-CEO, as she discusses the growing demand for climate-related information

Previously in the series

Before we look at how you can get your organisation ready for reporting under IFRS/ASRS, ensure you’re up to date with our discussion on how the proposed ASRS requirements will flow through the economy.

Whether you need to report under the planned mandatory ASRS legislation or whether you have been asked by your investors, customers or other stakeholders for climate-related information, the goal remains the same: to enhance transparency, accountability and ultimately, climate action across all aspects of your business. Let’s break down the steps to prepare your organisation.

Figure 1: Steps to get your organisation ready for IFRS/ASRS reporting
Figure 1: Steps to get your organisation ready for IFRS/ASRS reporting

1.  Understand and upskill: The journey towards climate resilience begins with a thorough understanding of your organisation’s reporting obligations. This means recognising not only the proposed mandatory requirements under ASRS but also responding to the broader demands of stakeholders for specific climate-related information. Upskilling your team is crucial.

Focus on enhancing skills in carbon accounting, climate risk assessment, and strategic climate planning. Key to this upskilling is bringing your entire organisation along, especially engaging your board and senior management to champion this initiative.

The finance team, tasked with merging climate data with financial reporting, plays a pivotal role. Ensuring they are fully equipped to navigate this new landscape is essential for a seamless integration of climate considerations into your business strategy.

➡️ Under the ‘Governance’ pillar, you need to disclose information about the governance body or individuals responsible for overseeing climate-related risks and opportunities. This includes their roles, responsibilities, skills, and how they incorporate climate-related considerations into your business’ strategy and risk management.

2. Develop a comprehensive carbon footprint: Begin by understanding your carbon footprint. If you’re new to this, start with Scope 1 and 2 emissions, and after you have a basic footprint, expand into Scope 3, or do it all in one go. It’s about capturing emissions associated with your operations, from the energy you use directly, to the indirect impacts in your supply chain.Your value chain holds the key to uncovering your full carbon footprint. Engage with suppliers and customers to understand and manage your Scope 3 emissions. These collaborations can lead to shared climate goals and innovative solutions for reducing emissions across the board.

➡️ As part of ASRS compliance, you need to disclose your Scope 1 and 2 carbon footprint, as well as your material Scope 3 emissions with a one year delay.

3. Assess climate risks and opportunities: Understand how climate change impacts your business, and translate these insights into your financial planning.It’s about turning climate challenges into opportunities for innovation and leadership in sustainability.

➡️ As part of ASRS compliance, you need to disclose your financially material climate risks and opportunities. You must detail how you oversee, identify, evaluate and manage climate-related risks and opportunities, how climate considerations are integrated into your business strategy and risk management and how climate considerations shape your strategic planning.

4. Develop a transition plan: Lay out a clear roadmap for decarbonisation that charts your path towards reducing carbon emissions and improving sustainability. Your transition plan should outline clear, actionable steps for decarbonisation, involve key stakeholders in the process, set specific, measurable targets, and establish robust governance structures to oversee progress. Consider aligning your plan with global sustainability frameworks such as the SDGs or GRI to not just comply with ASRS but to lead in corporate sustainability.

➡️ As part of ASRS compliance, you need to disclose your climate-related transition plan, including information about key assumptions and dependencies on which your transition plan relies.

5. Data collection and reporting: Developing internal systems for compliance with mandatory climate legislation not only ensures readiness for annual climate-related information updates but also makes sustainability reporting easier. By establishing robust tools and processes for managing this information, you can efficiently update your carbon footprint, as well as your risk register and strategy, ensuring capability for reporting under ASRS and to various stakeholders as needed.

➡️ As part of ASRS compliance, you need systems in place that allow you to disclose your greenhouse gas emissions across the three Scopes. You also need to collect data on potential future scenarios and physical and transition risks, as well as ensure that data on climate-related impacts on your financial performance and prospects are transparent and understandable. You will need to establish processes for regularly reviewing and updating your data collection and reporting practices, which includes verifying reported data to enhance the credibility of disclosures.

6. Commit to continuous improvement: Sustainability is a journey, not a destination. Start with what you have and build and refine your processes over time. Perfection from day 1 is unrealistic, and learning from your initial efforts is invaluable. This mindset not only facilitates internal growth and learning but also enhances your credibility with external stakeholders. Demonstrating a commitment to transparency—by openly acknowledging areas for improvement and detailing efforts to address them—builds trust and reinforces your dedication to climate action. Continuously reviewing and updating your practices ensures you remain compliant with evolving climate-related regulations and standards, while also fostering innovation.

➡️ Continuous improvement is a fundamental principle under ASRS, reflecting the dynamic nature of climate-related financial disclosures and the evolving understanding of climate risks and opportunities. Over time, as you refine your methodologies and data collection processes, the accuracy and reliability of your climate-related disclosures are expected to improve.

Conclusion

Don’t hesitate to seek expert guidance. Teams like ours at 100% Renewables can help you navigate the complexities of ASRS compliance and voluntary reporting, ensuring your efforts are accurate and impactful.

Whether you’re starting with understanding the gap to climate reporting, a basic footprint or advancing to transition planning or determining your climate risks and opportunities, we’re here to support you every step of the way.

Next in the series

In our forthcoming blog post, we’ll explore the key considerations for developing your ASRS-compliant carbon footprint.

Our ASRS complimentary course

In our ongoing dedication to assist businesses in their sustainability endeavours, we’ve revamped this multi-part blog and video series into a complimentary online course. Alongside the video content, the course offers additional resources and quizzes designed to enhance your comprehension of the ASRS.

Kickstart your journey towards mastering the ASRS. Join now by following this link. Don’t hesitate to share this opportunity within your network to collectively advance the climate agenda.

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