The CO2 Reduction Approach by Companies Is Inadequate
Erik Kolthof, Senior Advisor, Royal NBA and Lucas Geusebroek, Project Lead Circular Economy, Royal NBA |
A new survey shows that few companies are proactively trying to reduce their greenhouse gases. Many companies have no specific targets in this area, and records of CO2 emissions are mostly lacking even though measuring and reporting methodologies are available.
By ratifying the Paris Agreement, the Netherlands has committed itself to rapidly reducing CO2 and other greenhouse gas emissions. However, a survey of finance professionals conducted by the Royal Netherlands Institute of Chartered Accountants (NBA) and the University of Groningen shows that, although half of respondents indicate CO2 reduction is part of their organization’s mission and strategy, only 28% of these organizations (51 out of 187 respondents such as CFOs, financial managers, and controllers) actually measure emissions. Although CO2 policy is being discussed in the boardroom, the measurement and management of emissions is not widely embedded into day-to-day business operations.
Other key findings of the survey include:
The majority of organizations that measure CO2 emissions are larger organizations. Medium-sized and small organizations appear to be considerably less active. Only half of the organizations that measure their emissions use targets to drive subsequent actions to reduce emissions, and an internal (“shadow”) CO2 price is used in only two respondent organizations. Distinguishing between direct and indirect CO2 emissions is reported by only 10 respondents, and only 7 respondents indicate that the international standards of the GHG protocol are applied.
In response to the survey results, here are three clear recommendations.
Greenhouse gas policy
Standards and regulation
Illuminating the approach taken by Dutch organisations to reducing CO2 emissions, this survey will contribute to the public debate on the role of the private sector in reducing greenhouse gases. It also highlights that much needs to be done to enhance the role of finance professionals in the measurement of non-financial environmental information.