Glossary of Carbon Reporting Regulations Terms for Manufacturing

Navigating the complex world of carbon regulation and reporting can be challenging, especially with the multitude of technical terms and concepts involved. This glossary is designed to be your go-to resource for understanding key terminology in carbon reporting and regulations.   Organized by topic for ease of use, it provides clear definitions, practical examples, and helpful links to deepen your understanding and support your journey toward compliance and sustainability. For fuller guidance on how to manage compliance with sustainability and carbon reporting, see the Guide to Sustainability & Carbon Reporting in Manufacturing 

Standards and Protocols

Understanding the standards and protocols that govern carbon reporting is essential for ensuring compliance and driving effective sustainability strategies. This section overviews the key frameworks, guidelines, and methodologies that shape carbon accounting and reporting practices worldwide.   Explore the foundations of these standards to better align your organisation's efforts with global benchmarks and regulatory expectations. 

1. GHG Protocol (Greenhouse Gas Protocol)

The GHG Protocol establishes comprehensive global standardized frameworks to measure and manage greenhouse gas (GHG) emissions from private and public sector operations, value chains, and mitigation actions. 

2. ISO 14064-1

This is a standard for quantifying and reporting greenhouse gas emissions and removals at the organizational level. It provides a set of tools for programs to quantify, monitor, report, and verify GHG emissions. Read deeper into ISO 14064-1 on the ISO Org website. 

3. PAS 2050

PAS 2050,  part of the GHG Protocol, is a methodology for quantifying the life cycle greenhouse gas emissions of goods and services.

4. ISO 14001

ISO 14001 is a set of international standards for environmental management systems – systems that help manufacturers monitor and enhance environmental performance.

5. ISO 50001

ISO 50001 is a set of international standards for energy management systems – systems that help manufacturers monitor and improve energy performance.

6. GRI Standards (Global Reporting Initiative)

GRI Standards provide a global framework for sustainability reporting, including environmental metrics. GRI standards cover a variety of ESG areas, including Biodiversity and Anti-Corruption. GHG protocols, conversely, are focused exclusively on greenhouse gas emissions.

Regulations and Reporting Requirements

Complying with regulations and reporting requirements is a critical aspect of carbon management and sustainability efforts. This section outlines the key rules, directives, and frameworks that organisations must adhere to when disclosing their carbon emissions.   By understanding these requirements, you can ensure compliance, improve transparency, and demonstrate your commitment to environmental responsibility. 

1. ESRS (European Sustainability Reporting Standards)

ESRS (European Sustainability Reporting Standards) are a set of standards developed by the European Financial Reporting Advisory Group (EFRAG). The ESRS lay out standards for sustainability reporting under the Corporate Sustainability Reporting Directive (CSRD).

2. CSRD (Corporate Sustainability Reporting Directive)

The CSRD (Corporate Sustainability Reporting Directive) is a directive by the European Union that extends the scope of sustainability reporting to more companies, requiring them to disclose detailed information on environmental, social, and governance (ESG) issues. Read our blog on CSRD and role of carbon reporting for its compliance.

TCFD (Task Force on Climate-related Financial Disclosures)

The TSFD (Task Force on Climate-related Financial Disclosures) was an organisation that developed standards for ensuring global compliance with financial disclosures about climate-related activities of corporations. The TCFD provided recommendations for disclosing clear, comparable, and consistent information about the risks and opportunities presented by climate change.

NFRD (Non-Financial Reporting Directive)

The NFRD (Non-Financial Reporting Directive) is an EU directive that requires certain large companies to disclose information on the way they operate and manage social and environmental challenges.

SEC Climate Disclosure Rules

The SEC Climate Disclosure Rules are regulations proposed by the U.S. Securities and Exchange Commission for mandatory climate risk disclosures by publicly listed companies.

Disclosure and Benchmarking Frameworks

Disclosure and Benchmarking Frameworks are tools and systems that enable organizations to report their environmental performance and compare it against industry standards or peer performance.

CDP (Carbon Disclosure Project)

The CDP (Carbon Disclosure Project) is an organization that runs a global disclosure system for investors, companies, cities, states, and regions to manage their environmental impacts, particularly focusing on carbon emissions, water security, and deforestation.

CDSB (Climate Disclosure Standards Board)

The CDSB (Climate Disclosure Standards Board) provides a framework for reporting environmental information with the same rigor as financial information.

GRESB (Global Real Estate Sustainability Benchmark)

GRESB (Global Real Estate Sustainability Benchmark) assesses the ESG performance of real assets globally, including real estate portfolios and infrastructure assets.

SASB (Sustainability Accounting Standards Board)

SASB (Sustainability Accounting Standards Board) provides industry-specific standards for disclosing financial material sustainability information.

Market Mechanisms and Border Adjustments

Market Mechanisms and Border Adjustments are economic tools and regulatory measures designed to encourage reduction in carbon emissions through market-based incentives and regulations.

CBAM (Carbon Border Adjustment Mechanism)

CBAM (Carbon Border Adjustment Mechanism) is a proposed EU measure to put a carbon price on imports of certain goods from outside the EU, aimed at preventing “carbon leakage” by ensuring that imported goods are subject to the same carbon costs as those produced within the EU. For a simple overview of how CBAM will work, see the Guide to EU CBAM Reporting for Manufacturers

ETS (Emissions Trading System)

ETS (Emissions Trading System) is a market-based approach to control pollution by providing economic incentives for achieving reductions in the emissions of pollutants. Examples include the EU ETS and the California Cap-and-Trade Program.

Carbon Offsets

Carbon Offsets are mechanisms for compensating for emissions by investing in projects that reduce or remove greenhouse gases from the atmosphere, such as reforestation or renewable energy projects.

Carbon Tax

A tax levied on the carbon content of fuels to encourage the reduction of greenhouse gas emissions. Manufacturers that choose to adopt practices that lower their overall carbon emissions can benefit from reductions in their Carbon Taxes.

Goals and Initiatives

Goals and Initiatives encompass various global, national, and organizational commitments and programs aimed at reducing carbon emissions and promoting sustainability.

SDG (Sustainable Development Goals)

The SDG (Sustainable Development Goals) are a collection of 17 interlinked global goals designed to be a “blueprint to achieve a better and more sustainable future for all” by 2030. SDG 13 specifically focuses on climate action, including efforts to reduce carbon emissions.

SBTi (Science Based Targets initiative)

SBTi (Science-Based Targets initiative) is an organization that helps companies set science-based targets to reduce greenhouse gas emissions in line with the latest climate science and the goals of the Paris Agreement. Companies like Volkswagen and the Ford Motor Company are using SBTi to further their climate aims. See a full list of SBTi companies here.

Paris Agreement

The Paris Agreement is an international treaty, developed by the United Nations, aiming to limit global warming to well below 2°C above pre-industrial levels, preferably to 1.5°C.

RE100

RE100 is a global initiative where influential businesses commit to 100% renewable electricity.

Net Zero Initiative

The Net Zero Initiative is a set of various frameworks and pledges aimed at achieving net zero carbon emissions by a specified date, commonly by 2050.

C40 Cities Climate Leadership Group

C40 Cities Climate Leadership Group is a network of the world’s megacities committed to addressing climate change through various local initiatives.

Conclusion

Understanding the intricacies of carbon reporting, from regulations and standards to frameworks and initiatives, is essential for navigating the evolving landscape of sustainability.   By leveraging these tools and aligning with global goals, organisations can drive meaningful environmental action, ensure compliance, and position themselves as leaders in the transition to a low-carbon economy. Embracing transparency and accountability today paves the way for a more sustainable and resilient future.  Contact Mavarick today to learn how we can help you turn sustainability into a competitive advantage.