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Explore expert insights and actionable strategies designed exclusively for the tourism sector.
Understand how the tourism industry can reduce its carbon footprint, and how our 2XE framework supports the net zero journey.
Carbon accounting is so last year, right? Well, possibly not. Many at the forefront of the sustainability journey started measuring and managing the amount of carbon dioxide their business was emitting many years ago, but many have not yet had the opportunity.
As you would for any improvement you want to make in your business, you first need to understand the current situation. For improvements to your sustainability, carbon accounting will quantify greenhouse gas emissions emitted due to your operations and resources you use so you can determine where the opportunities are to reduce and what your priorities will be for the future. With the new mandatory climate reporting hitting large corporates in the coming fiscal year, businesses are increasingly going to be asked for this data from their supply chains.
Just to be clear, carbon accounting doesn’t have to be done by an Accountant. In fact, it can fall to the procurement team, business improvement team, or a team member that is passionate about sustainability. It does involve numbers so you will need good numeracy.
If you do not have the resources in-house, then net zero carbon consultants like us here at 2XE can help you in:
Carbon accounting is not only about reducing our impact on the environment, but it is also about decoupling business growth from the over-reliance on fossil fuels. By having a process to measure and manage your emissions, you can plan to reduce your business exposure to climate-related risks and promote your business chance of success in the medium- and long-term.
When you hear about ‘net zero’ targets and strategies, it is about limiting the greenhouse gas (GHG) emissions into the earth’s atmosphere. At its very core, the carbon accounting number crunching will help you understand your use of resources (energy, water and waste). You use this usage data along with standardised emission factors to calculate your GHG emissions.
Carbon accounting is not solely about environmental impact; it is crucial for financial performance. In the short term, it helps identify inefficiencies and achieve cost savings through improved resource efficiency. In the medium and long term, it enables businesses to understand and mitigate exposure to various climate-related risks, both physical and transitional. This proactive approach not only supports sustainability goals but also enhances economic resilience and financial stability
Increasingly there is a connection between the ‘E’ and the ‘S’ in ESG. It goes hand in hand, for example when organisations reduce their emissions, that ultimately improves air quality, leading to better health for us all. We are also seeing a significant push from consumers and the market for real action against climate change. So emissions accounting is the first step towards addressing that.
Ultimately, this process is about rallying the team behind the sustainability journey and emphasising the importance of carbon accounting, even if not everyone is directly involved with the numbers. It is about creating systematic processes that provide the C-Suite, Board, and investors with the insights and data they need to make informed decisions.
So, before you dive into the utility bills to get your consumption data, get up to speed on:
You need to determine your organisational and operational boundaries. The first one is simple if you are a solely owned single business, however it does get more complicated if you have subsidiaries or joint ventures, for example. The operational boundary is where ‘scopes’ of emissions come into the conversation. The operational boundary defines which operations and assets (such as buildings and the vehicle fleet), both direct and indirect, are included in the company’s GHG inventory.
Scope 1: Direct emissions from owned or controlled sources (e.g. company vehicles or on-site fuel combustion).
Scope 2: Indirect emissions from the consumption of purchased electricity.
Scope 3: Other indirect emissions in the value chain, including supply chain and product lifecycle emissions.
There are plenty of platforms that can support you in your carbon accounting, including our own net zero management platform however it can also be as simple as using a spreadsheet, especially if you are just starting out.
We have done a lot of research into this, particularly with the explosion of technologies in the market for businesses to subscribe to. What we have found is that there are many platforms to help you input and track historical data, but what about looking forward? What if you are considering expanding your asset base? What impact does that have on your emissions into the future? Scenario analysis is what we are working on here at 2XE and we can’t wait to share more news with you about this soon … watch this space.
Regulatory change is already happening in this area with the new mandatory climate reporting at the national level. While this starts at the ‘big end of town’ with listed companies and larger financial institutions, these organisations will be asking their value chain for their emissions data as part of their Scope 3 reporting … if you provide products or services to these larger companies, then you’ll want to be capturing your emissions already and having an emissions reduction strategy in place. Carbon accounting will need to be your best friend.
The changes in the regulatory environment are, in part, a push from investors for greater transparency of carbon emissions and reduction efforts. Increasingly, they are using ESG criteria to make investment decisions.
The evidence is mounting that consumers, particularly younger demographics, are increasingly seeking more sustainable products and services. And that they are prepared to pay more for them. This is an opportunity for your business.
While yes there are distinctions between the terminology we use, like what is carbon accounting, what is a net zero target, and what it means to be sustainable. These processes will usually all involve numbers.
We know that a carbon accounting process will give you a solid understanding of how you use resources and this will benefit your operations. And for broader industry and supply chain benefit, sharing your emissions data across your supply chain helps everyone. Knowledge is power, right?
What is all the talk of the Australian corporate world that will ultimately kick into gear in 2025? If you haven’t heard already, then it is the upcoming mandatory climate-risk reporting to fall under the Corporations Act 2001. So, you want to hear more of this story?
Environmental, Social, and Governance, or more commonly called ESG, reporting has evolved from its early beginnings in the 1970s and 1980s when the concept of corporate social responsibility began to emerge. Despite a lack of consistency or guidance in the early days, many companies recognised that they had responsibilities beyond just the bottom line and put focus on their economic, social and environmental impacts. While in these early days, it was about the impact of businesses on the broader community, now ESG is about understanding the mutual link (or the interconnection) of a business performance and the broader community.
One of the first reporting standards widely adopted was the Global Reporting Initiative (GRI), founded in 1997 to provide a comprehensive sustainability reporting framework still widely used by organisations globally. Most uncomplicatedly, they define ESG reporting as the ‘process through which organisations publicly disclose information about their economic, environmental, and social impacts caused by their everyday activities’.
Since August 2022, the International Sustainability Standards Board (ISSB) of the IFRS Foundation assumed responsibility for the Sustainability Accounting Standards Board (SASB)® Standards. The incorporation of SASB standards into the ISSB's framework, has promoted a more unified approach to ESG reporting. A lot of countries, including Australia, are now adopting the IFRS S1 and S2 standards as the basis of their own ESG reporting standards.
These are now some of the many reporting frameworks that have emerged over the years … with so many fingers in the ESG reporting pie, including many net zero management consultants in Australia, let’s simplify the steps for you.
At first glance, ESG reporting can seem complex. There are diverse standards and frameworks, you must collect data and conduct a materiality assessment to determine what ESG issues are most important to you. Then integrate this with your traditional financial reporting to give a holistic view of your performance, plus be across the ever-changing regulatory and compliance requirements. You’ll have qualitative narratives and quantitative data to balance, a range of stakeholder expectations to meet AND you’ll need verification and assurance.
Maybe you would like a management consultant like 2XE to help you?
This criteria is what investors and financiers are increasingly looking for to evaluate the long-term sustainability of a company and the impact of environmental, social and governance risks on a business.
As part of your ESG reporting, you will need to consider criteria across the three categories:
You are already doing it. Reading up and understanding more about the ESG reporting requirements help you prepare for the reporting and ensure that your organisation can effectively measure, manage, and communicate its sustainability performance.
Like any new project, you should set goals. Are you seeking greater transparency, or do you have to meet particular regulatory requirements? Or are you hearing the calls from across your stakeholders?
Very important in your preparation for ESG reporting is the framework you choose to align with. We have mentioned the Global Reporting Initiative (GRI) already and the Yet, there is also the Sustainability Accounting Standards Board (SASB), the Task Force on Climate-related Financial Disclosures (TCFD), and others that align with your industry and goals.
With your team around you, this can be an engaging couple of hours to identify and prioritise the ESG issues that are most significant to your business and stakeholders.
The results of a materiality assessment guide a company in focusing its ESG reporting and strategy on the issues that matter most to stakeholders and have the greatest potential impact on the business. The results of the materiality assessment can be refined and improved over time as you develop a better understanding of your business and key stakeholders.
With your reporting framework selected and materiality assessment completed, you should have the details of what you need to report. You should consider developing templates and assigning responsibility to the right teams to collect the data, and consider what technology and tools might help you with this work is a good team discussion before you get too far into the data collection process.
Many reporting standards offer training to deepen your understanding of the ESG reporting process. This is a good idea, and then you can bring your team together from across key departments like sustainability, finance, HR, operations, to allocate tasks and due dates for content.
Certain elements can be included like the:
While the focus is on the environmental, social and governance aspects, an ESG report can include financial performance to provide an overall picture of your company’s performance and impact.
While there is not a single compulsory format for ESG reporting, the content and structure of these reports are widely accepted. A net zero ESG management consulting firm like 2XE can help you with this, as we understand the regulatory requirements, including:
With consumers' growing demand for sustainable products and investors' and financiers' heightened expectations for effective ESG risk management, communicating your ESG performance is essential. Using your ESG report as a foundation, collaborate with communication specialists to leverage multiple channels to share your achievements. This includes using social media, newsletters, PR activities such as media releases, and hosting ESG events.
ESG reporting is no longer just a ‘nice to have’, it is expected by employees, board members, shareholders, customers, suppliers, investors, financiers, regulators, community organisations, and the media and general public. We are beyond ‘debating’ climate change here in Australia, and the broader ESG reporting gives you the chance to fully explore the sustainability and ethical performance of your organisation.
ESG reporting provides a full evaluation of your organisation’s environmental impact, social performance, governance practices, and economic contributions. Whether prepared internally or by a net zero ESG management consultant, your ESG report examines the effectiveness of your sustainability efforts, risk management, stakeholder engagement, and strategic goals. Through this analysis, you can highlight your commitment to ethical practices, showcase your work to your stakeholders, and give you the chance to celebrate your overall sustainability performance with your team.
As conscious travellers and markets increasingly seek eco-friendly destinations and experiences, embracing sustainability is a pathway to combat increasing costs and the impact of climate change in the tourism industry. You are uniquely positioned to capitalise on the growth opportunities a net-zero commitment can bring to enhance your business efficiency and unlock new possibilities.
We have produced this e-book to assist businesses like yours in the tourism sector in embarking on a transformative journey towards sustainability and adopting eco-friendly practices. This all-encompassing guide comes with practical strategies and expert insights, carefully tailored to the specific needs of the tourism industry.
Explore expert insights and actionable strategies designed exclusively for the tourism sector.
Understand how the tourism industry can reduce its carbon footprint, and how our 2XE framework supports the net zero journey.
With rising costs and rising temperatures, you are in the perfect position to take advantage of the growth opportunities that a net-zero commitment can bring. Not only will this create efficiencies in your business, but it will also open new doors as customers and markets are increasingly seeking sustainable wine.
Introducing our e-book which is designed to help wineries like yours transition toward sustainability and embrace eco-friendly practices. This comprehensive guide is filled with actionable strategies and expert insights that are specifically tailored to the wine industry.
Learn why taking action is essential, what the wine industry must do to reduce its carbon footprint, and how our 2XE framework supports the net zero journey. Embrace sustainability and unlock a greener future for your winery.
