Poor disclosure and lack of a clear definition and protocols is hindering progress in reducing carbon emissions, says a report from the group, which includes environmental organisations and businesses, including BT, United Utilities and Biffa.
The group's chairman Adrian Wilkes warned that "lack of transparency obscures the UK's true contribution to carbon emissions, and would impede the setting of accurate carbon targets and budgets in the proposed climate change Bill."
The report warns that vague disclosures and unreliable data make it difficult for investors to compare performance on carbon reductions and leaves reporting companies vulnerable to "greenwash".
"It is vital that carbon accounting and disclosure are clearly defined and comparable measures are used by all large businesses operating in the UK," says the group.
It wants a standard to be integrated into narrative reporting guidance for the business reviews that, under the Companies Act 2006, firms must include in their annual reports.
The Aldersgate Group is calling for the government to drive the development of a carbon accounting standard, and for businesses to set it.
In particular, it says UK-listed companies should be required to disclose:
- Absolute total annual emissions of all carbon-based greenhouse gases – direct and indirect.
- Relative total emissions as a percentage of annual company turnover.
- The amount and value of allowances allocated to them under the EU emissions trading scheme, as well as the value of credits for offsets under Kyoto Protocol flexible mechanisms.
- Physical and regulatory risks posed by climate change to products and services.
Once a standard is in place, enforcement should target non-disclosure or material misstatement, says the group.