| The World Resources
Institute (WRI) and the World Business Council for Sustainable
Development (WBCSD) released an international standard that
will enable businesses to uniformly report their emissions of
greenhouse gases. |
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The standard, called the Greenhouse Gas Protocol Initiative or
GHG Protocol, was developed over a three-year period by a partnership
of over 350 individuals from corporations, non-profit organizations
and governments. It is supplemented by a number of user-friendly
calculation tools that can be found at www.ghgprotocol.org.
“Unlike for financial accounting and reporting, there are no
generally accepted international accounting and reporting practices
for corporate emissions of greenhouse gases,” said Kjell Oren,
director of WBCSD’s Climate and Energy Program. “GHG Protocol
will enable businesses to account and report information from global
operations in a way that is consistent with financial reporting
standards.”
The GHG Protocol addresses the six greenhouse gases identified by
climate treaty negotiators as key contributors to global warming.
They are: carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O),
hydrofluorocarbons (HFCs), perfluorocarbons (PFCs) and sulfur hexaflouride
(SF6).
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"In
the future, greenhouse gases will need to be accounted for
on a company’s balance sheet in the same way as other
assets and liabilities."
—Jonathan
Lash, WRI President
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“In the future, greenhouse gases will need to be accounted
for on a company’s balance sheet in the same way as other assets
and liabilities,” added Jonathan Lash, WRI president.
The GHG Protocol provides managers with valuable information on
which to build an effective strategy to manage and reduce greenhouse
gas emissions. It also provides information that complements other
efforts like the U.S. Environmental Protection Agency’s Climate
Leaders Initiative, the California Climate Action Registry, the
UK Emissions Trading Scheme and the World Wildlife Fund Climate
Savers Program.
The development of the GHG Protocol was guided by two simple principles:
inclusiveness and transparency. “The GHG Protocol is the common
product of numerous individuals and organizations around the globe,
united by a shared vision of developing an internationally accepted
reporting standard,” said Janet Ranganathan, senior associate
in WRI’s Sustainable Enterprise Program, who directed the GHG
Protocol Initiative for WRI. “The number of participants who
contributed to the GHG Protocol signals a growing acceptance among
business, governments, NGOs and other stakeholders of the need for
action on climate change.”
The GHG Protocol was road tested by over 30 companies in nine countries,
including Dow Chemical Canada, Du Pont, Ford Motor Co., Fortum Power
and Heat, General Motors Corp., Hindalco Industries, IBM, Norsk
Hydro, Ontario Power Generation, Shell Canada, Tokyo Electric Power
Co. and Volkswagen.
Even while international climate negotiators are still working out
the details of the Kyoto Protocol, some governments are already
taking steps to reduce emissions through voluntary reduction and
reporting programs, emissions trading schemes, carbon or energy
taxes or regulations and standards on energy efficiency.
However, a credible accounting standard is needed for businesses
participating in voluntary initiatives, GHG trading markets and
for complying with government regulations. Although there are several
efforts to establish guidelines, the GHG Protocol is the first international
standard of its kind.
In the future, the GHG Protocol will also develop modules to account
for offsets of greenhouse gas emissions like carbon sinks and to
consistently account for greenhouse gas emissions throughout the
value chains.
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