The benefits of voluntary carbon reporting in South Africa

Submitted by: Amanda Botes, Tuesday, May 7, 2013

“Voluntary reporting provides significant benefits to justify action regardless of mandatory requirements”, this is according to a recent report by the National Business Institute entitled The benefits of voluntary greenhouse gas accounting in the context of mandatory reporting”. Many countries around the world are starting to legislate the reporting of carbon information. In South Africa the National Climate Change Response White Paper states that mandatory GHG reporting will be enforced in the near future.  Currently, companies that do report on their carbon information do so voluntarily mainly through the South African Carbon Disclosure Project (CDP).   In this NBI report, the authors encourage organisations to continue to report on their emissions voluntarily and cite the many benefits of reporting voluntarily on the eve of mandatory reporting in South Africa.

The report states that whilst mandatory reporting will be less detailed and only certain companies will be required to report, there are multiple benefits for companies to continue to report voluntarily and to go beyond reporting for compliance sake. Some of the benefits of voluntary carbon reporting expressed in the report include the opportunity for companies to assess risk and opportunity, enhance their reputation with multiple stakeholders, and reduce costs by switching to more environmentally friendly technologies. Furthermore, companies that are already reporting voluntarily in South Africa will find it far easier to incorporate the new mandatory requirements into their reporting systems. The report adds that many companies report on carbon for compliance and do not use the data to make decisions. The authors encourage companies to identify issues that are most important for their business and gather carbon data in these areas so that they can make better decisions.

The report also aims to encourage companies that are not yet reporting to understand the value and benefits of carbon reporting. Using a narrative of case studies of South African companies (Exxaro, GoldFields and FirstRand), the report highlights the benefits of voluntary reporting, the barriers experienced at different stages by the companies concerned, and the solutions that they have implemented.  The companies included in the report have consistently performed well in the South African Carbon Disclosure Project. The authors note that the case studies offer organisations with a useful starting point to begin discussions of voluntary reporting.The authors also warn companies that are not presently reporting that they will experience a steep learning curve if required to report under the mandatory system and encourage these companies to start reporting voluntarily in the interim.

The report includes a section written by the Department of Environmental Affairs (DEA) on the status of mandatory reporting in South Africa. Currently the DEA is working on developing emissions inventory reporting guidelines which will include a reporting format, South Africa specific emission factors, and national methodologies. The expected release date for these regulations is June 2014.

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Amanda Botes