The Financial Reporting Council (FRC) said companies’ reports on their energy and carbon consumption need to be easier to understand and more relevant for users.
The FRC today published the findings of its review of reporting on emissions and energy consumption under the new Streamlined Energy and Carbon Reporting (SECR) rules, which came into effect on 1 April 2019.
In its review, the FRC looked at how a sample of companies had complied with the new SECR requirements.
Although the companies largely complied with the minimum requirements for reporting their emissions and energy consumption, more needs to be done to make these disclosures understandable and relevant for users, the FRC said in a statement.
“In particular, entities need to explain more clearly how information is calculated, which operations and emissions are included in their reported numbers and the level of third-party assurance obtained over the information.
“They also need to consider how to integrate these disclosures with other narrative reporting on climate change, especially any emission-reduction targets,” the FRC said.
The FRC’s executive director of regulatory standards, Mark Babington, commented: “Looking ahead, companies should carefully consider the findings of our review with a view to providing high quality information about current emissions, in the context of increasing focus on emission-reduction commitments and strategies.”