The Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 – known colloquially as Mandatory Carbon Reporting, or MCR – has now been laid before Parliament. The new regulations require all reports produced in relation to financial years ending on or after 30 September 2013 to disclose GHG emissions.
This announcement has been a long time coming and many companies have played a waiting game in anticipation of the exact detail of the regulations.
The appearance of GHG emissions data heralds a fundamental change to directors’ reports and will require companies to swiftly develop a framework that allows such information to be collated and accurately reported.
The statutory significance of environmental reporting has now been elevated to the same level as financial information. Companies and their directors have a particular responsibility in this respect, as the Regulations explicitly require the directors’ report to set out the methodologies used to calculate the emissions information and the ratio that confirms the relationship between an organisation’s emissions and activities.
Directors will not only want assurance that such numbers are correct but also a thorough understanding of how these break down across the business, by type of greenhouse gas and geography.
You can learn all about MCR, what it means for your business and what you need to do about it by visiting our Mandatory Carbon Reporting page.