IS2 is important if we believe in preventing the planet from getting warmer but, with the changes making it easier to report on certain aspects of emissions, is this an exercise to standardise greenwashing?
The UKSA Policy Team thinks not. Read on to find out why.
IS2 requires companies to report on the amount of gas emissions, whether released by them or their supply chain, that trap heat in the atmosphere. These emissions are called greenhouse gases.
There are 15 different greenhouse reporting categories. Number 15 covers the total of financial investments supporting activities that lead to these emissions.
In the jargon, this is called, “Scope 3 Category 15 emissions”. “Scope 3” covers the emissions, “Category 15” covers the amount of finance that leads to activities contributing to emissions. Here is the list of the 15 categories.
Under specific conditions, as set out in IFRS - IFRS S2 Climate-related Disclosures, organisations will be able to choose when to decrease their reporting on some aspects of investment.
The UKSA Policy Team has responded to support these changes but raise these points.
- We question whether financial investments are really part of Scope 3 emissions as they do not contribute directly to emissions.
- But, if investments continue to be part of IS2 reporting, we believe there should be consistency in what is reported.
- The quality of reporting must be reviewed to ensure there is no intentional or unintentional ‘greenwashing’.
