Questions & Answers
I would like to know if corporates need to update and disclose their Gross GHG scopes 1-3 each year to comply with the ESRS requirements.
- GHG emission
- annual update
Background
The original question submitted is the following: ‘GHG Emission Gross – scope 1-3— I would like to know if corporates need to update and disclose their GHG emissions each year to comply with the CSRD reporting.’
ESRS 1 paragraph 30 provides that when the undertaking concludes that a sustainability matter is material ‘… it shall: (a) disclose information according to the Disclosure Requirements (including Application Requirements) related to that specific sustainability matter in the corresponding topical ESRS …’. ESRS 1 paragraph 73 states: ‘The reporting period for the undertaking’s sustainability statement shall be consistent with that of its financial statements.’
ESRS 1 paragraph 132 states: ‘For the first three years of the undertaking’s sustainability reporting under the ESRS, in the event that not all the necessary information regarding its upstream and downstream value chain is available, the undertaking shall explain the efforts made to obtain the necessary information about its upstream and downstream value chain, the reasons why not all of the necessary information could be obtained, and its plans to obtain the necessary information in the future.’
ESRS 1 paragraph 133 states: ‘For the first three years of its sustainability reporting under the ESRS …
(b) when disclosing metrics, the undertaking is not required to include upstream and downstream value chain information, except for datapoints derived from other EU legislation, as listed in ESRS 2 Appendix B.’
This appendix includes Scope 1-3 and total emissions.
ESRS 1 Appendix C: List of phased-in Disclosure Requirements includes reference to E1-6 Disclosure Requirement, indicating that undertakings or groups not exceeding on their balance sheet dates the average number of 750 employees during the financial year (on a consolidated basis where applicable) may omit the datapoints on Scope 3 emissions and total GHG emissions for the first year of preparation of their sustainability statement.
ESRS E1 Disclosure Requirement E1-6 paragraph 44 requires the undertaking to disclose its gross Scope 1, Scope 2, Scope 3 and total GHG emissions. With respect to the Scope 3, ESRS E1 paragraph AR 46 (f) requires updating Scope 3 GHG emissions in each significant category every year on the basis of current activity data and updating the full Scope 3 GHG inventory at least every three years or on the occurrence of a significant event or significant change in the circumstances.
Answer
An undertaking shall disclose and update their Gross Scopes 1, 2, 3 and Total GHG emissions on an annual basis (consistent with financial statements, as per ESRS 1 paragraph 73) and in accordance with the provisions of ESRS 1 and ESRS E1-6.
With regard to Scope 3 GHG emissions more specifically, the update of Scope 3 GHG emissions in each significant category shall occur every year on the basis of current activity data; the update of the full Scope 3 GHG inventory is required at least every three years or on the occurrence of a significant event or a significant change in circumstances (see ESRS E1 paragraph AR 46 (f)).
Relations
Paragraph | Content |
|---|---|
Appendix C - List of phased-in Disclosure Requirements | |
Appendix C - List of phased-in Disclosure Requirements | |
Appendix C - List of phased-in Disclosure Requirements | |
For the first 3 years of the undertaking’s sustainability reporting under the ESRS, in the event that not all the necessary information regarding its upstream and downstream value chain is available, the undertaking shall explain the efforts made to obtain the necessary information about its upstream and downstream value chain, the reasons why not all of the necessary information could be obtained, and its plans to obtain the necessary information in the future. | |
when disclosing metrics, the undertaking is not required to include upstream and downstream value chain information, except for datapoints derived from other EU legislation, as listed in ESRS 2 Appendix B. | |
The reporting period for the undertaking’s sustainability statement shall be consistent with that of its financial statements. | |
When the undertaking concludes that a sustainability matter is material as a result of its materiality assessment, on which ESRS 2 IRO-1, IRO-2 and SBM-3 set disclosure requirements, it shall: | |
update Scope 3 GHG emissions in each significant category every year on the basis of current activity data; update the full Scope 3 GHG inventory at least every 3 years or on the occurrence of a significant event or a significant change in circumstances (a significant event or significant change in circumstances can, for example, relate to changes in the undertaking’s activities or structure, changes in the activities or structure of its upstream and downstream value chain(s), a change in calculation methodology or in the discovery of errors);”); | |
The undertaking shall disclose in metric tonnes of CO2eq its : | |
update Scope 3 GHG emissions in each significant category every year on the basis of current activity data; update the full Scope 3 GHG inventory at least every 3 years or on the occurrence of a significant event or a significant change in circumstances (a significant event or significant change in circumstances can, for example, relate to changes in the undertaking’s activities or structure, changes in the activities or structure of its upstream and downstream value chain(s), a change in calculation methodology or in the discovery of errors);”); |