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Good for business
New research reveals that the benefits of mandatory carbon reporting (MCR) for large businesses are much greater – and the costs lower – than the Government has suggested.

The new report – commissioned by Aldersgate Group, The Co-operative Group, Christian Aid and WWF – found that Defra’s impact assessment (IA) of mandatory greenhouse gas reporting overestimated the total costs of MCR for large companies by up to £4,600 million (over 420%), and underestimated the benefits by £980m (at least 230%).

Defra’s impact assessment, carried out as part of its recent consultation on MCR which closed on 5 July, estimated that the total costs (over ten years) of MCR for large companies could be as much as £6,025m and the total benefits a maximum of £1,355m.

The new research suggests that the official impact assessment has not factored in the benefits that carbon reporting would bring over time, questions some of the costs assumptions and it argues that some benefits and costs have been omitted.

The groups that commissioned the report argued that the findings show that mandatory carbon reporting would be good for business and play a vital part in our transition to a low-carbon economy.

Even though the new analysis shows that MCR will benefit UK businesses the groups that commissioned the report are concerned that major benefits to society and the environment will be missed in the final decision because they cannot be quantified as a benefit to UK business. The groups urge the Secretary of State for Defra, Caroline Spelman, to factor in these less measurable but real benefits in her final decision this coming autumn.

Sue Charman, One Planet finance leader at WWF-UK said: “The best companies are already measuring and managing their carbon as a matter of best practice, and it’s time the laggards were made to do so as well. Voluntary carbon reporting has played its part but now it’s time for mandatory carbon reporting to be brought in to really drive efficiency savings and drive down greenhouse gas emissions.”