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New carbon reporting legislation for leading businesses

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Planet Positive

From 2013 any business listed on the London Stock Exchange will have to report on their emissions in their annual financial report. In a new piece of legislation, set by Deputy Prime Minister Nick Clegg, the UK will be the first to make it compulsory for major companies to report on their greenhouse gas (GHG) emissions annually. Ultimately, the aim is to demonstrate leadership and trigger a coordinated regulatory effort that tackles climate change at an international level.Planet Positive

Why is it happening?
In order to meet the UK’s emissions reduction target the Government has recognised that a concerted effort is required. By mandating carbon reporting it is hoped that companies will set carbon reduction targets, track key performance indicators and report their achievements, which will contribute to more significant reductions in the UK’s GHG emissions.
Moreover, Mandatory Carbon Reporting will help to further strengthen the regulatory framework that the CRC Energy Efficiency Scheme has already established, meeting the growing demand from corporate executives for the government to provide regulations with greater clarity and transparency.

What is required?
As of 2013 all companies listed on the London Stock Exchange will have to report their entire organisation’s carbon emissions, including overseas operations, in their annual reports. This involves measuring and reporting on Scope 1 (direct emissions, including the combustion of fuels e.g. boilers, vehicle fleet) and Scope 2 (indirect emissions, resulting from the consumption of purchased electricity, heat or steam).

Once measured, business will have to report their emissions alongside the methodology used to calculate it in the directors report of their annual report. Failure to report will lead to enforcement by the Conduct Committee of the Financial Reporting Council under the Companies Act 2006.

Challenges and opportunities for the finance sector
As the legislation will come into play in April, companies do not have long to get the necessary systems in place. The emissions reporting boundary must be established, aims should be outlined and targets and KPIs defined in order to drive reductions. In addition, the approaches taken must be robust and transparent, with third party validation of reports an important step to certify accurate reporting. Best practice guidelines and cooperation between companies will facilitate the production of reliable and easily comparable reports.

The finance sector stands to benefit greatly from the Mandatory Carbon Reporting legislation. Investors and investments are progressively focusing their strategies on businesses which are actively sustainable or have good environmental credentials. As a result, environmental responsibility is becoming a crucial standard used to benchmark organisations, and differentiate brands and products to potential investors, shareholders and consumers. Companies that fail to report their carbon emissions to an adequate standard will likely find themselves at a competitive disadvantage.

As sustainability and climate change shift the risk landscape, financial institutes are finding themselves under increasing pressure. Reducing dependence on expensive and volatile raw materials by reducing energy consumption and utilising waste streams effectively will limit the environment’s impact on business and are therefore essential strategies for growth. Those who manage to successfully navigate such complexities will find themselves positively differentiated from their competitors. Planet Positive

There are already several financial institutions recognised for their environmental and social leadership such as UBS, Allianz Group and Wells Fargo; however, there is a lack of confidence in the ability of financial companies to factor issues of sustainability into their decision making. Additionally, the potential also exists to deploy capital towards long term productive assets, or to manage business processes in a more transparent and accountable manner. By capitalising on the opportunities that arise from integrating sustainable practices into operations, the finance sector stands to benefit significantly.

Sustainability makes sense
Grant Thornton’s recent report revealed that of 200 organisations surveyed, 92% rate sustainability performance as either ‘very important’ or ‘important’. This is due to the number of benefits that can be obtained by creating a comprehensive sustainability strategy for your business. By monitoring, measuring and reporting on KPIs businesses can gain valuable insights that will ensure their long-term strategy is sound.

Carbon reporting is no longer viewed as the latest green trend, with only six companies in the FTSE 100 not reporting on their emissions. Mandatory Carbon Reporting puts the UK’s largest organisations in the limelight, enabling them to play a major role in progressing business practices and encouraging others to follow suit.

As Bruno Berthon, managing director, Accenture Sustainability Services explains, “Measuring climate change risks and performance goes beyond environmental stewardship. Transparent disclosure lowers risks and helps to demonstrate to investors and decision makers the relative appeal of their business in a competitive world.”  

With a growing number of businesses disclosing their carbon emissions, those that do not will find themselves increasingly left behind. Furthermore, developing a carbon reduction strategy makes good business sense. It generates cost savings, is an effective form of risk management, enhances reputation, increases market opportunities and improves employee engagement. In 2012 Marks & Spencer reported £105m in annual net benefits from its sustainability strategy ‘Plan A’, while Tesco claim their energy efficiency strategy saved them £270m in 2011.

With a review scheduled for 2015 it is anticipated that Mandatory Carbon Reporting will grow beyond the current legislation, affecting mid-sized organisations alike. It is expected that larger companies will continuously seek ways to reduce carbon emissions associated with their business operations and will therefore look to their supply chains to make further savings. 

A fast, low cost solution to Mandatory Carbon Reporting
Surveys suggest that many companies are swamped and confused by the numerous metrics that exist to measure different aspects of sustainability. By implementing the Mandatory Carbon Reporting legislation, companies have a straightforward process, with clear guidance, to follow.

Planet Positive, in partnership with CloudApps, offer a tailored service to help companies meet their mandatory requirements. The application is designed to be fast, effective and affordable, helping businesses to measure and validate their data.

Many businesses have already benefited from using our joint service, achieving significant improvements in operational efficiencies and employee engagement. For those companies already measuring their emissions, Planet Positive offer a third party validation to ensure that their calculations are accurate and that transparent and rigorous methodologies are being used.

To find out more download the Planet Positive Mandatory Carbon Reporting leaflet.

 

 

 

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Exclusive: China’s Huawei, reeling from U.S. sanctions, plans foray into EVs – sources

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Exclusive: China's Huawei, reeling from U.S. sanctions, plans foray into EVs - sources 1

By Julie Zhu and Yilei Sun

HONG KONG/BEIJING (Reuters) – China’s Huawei plans to make electric vehicles under its own brand and could launch some models this year, four sources said, as the world’s largest telecommunications equipment maker, battered by U.S. sanctions, explores a strategic shift.

Huawei Technologies Co Ltd is in talks with state-owned Changan Automobile and other automakers to use their car plants to make its electric vehicles (EVs), according to two of the people familiar with the matter.

Huawei is also in discussions with Beijing-backed BAIC Group’s BluePark New Energy Technology to manufacture its EVs, said one of the two and a separate person with direct knowledge of the matter.

The plan heralds a potentially major shift in direction for Huawei after nearly two-years of U.S. sanctions that have cut its access to key supply chains, forcing it to sell a part of its smartphone business to keep the brand alive.

Huawei was placed on a trade blacklist by the Trump administration over national security concerns. Many industry executives see little chance that blocks on the sale of billions of dollars of U.S. technology and chips to the Chinese company, which has denied wrongdoing, will be reversed by his successor.

A Huawei spokesman denied the company plans to design EVs or produce Huawei branded vehicles.

“Huawei is not a car manufacturer. However through ICT (information and communications technology), we aim to be a digital car-oriented and new-added components provider, enabling car OEMs (original equipment manufacturers) to build better vehicles.”

Huawei has started internally designing the EVs and approaching suppliers at home, with the aim of officially launching the project as early as this year, three of the sources said.

Richard Yu, head of Huawei’s consumer business group who led the company to become one of the world’s largest smartphone makers, will shift his focus to EVs, said one source. The EVs will target a mass-market segment, another source said.

All the sources declined to be named as the discussions are private.

Chongqing-based Changan, which is making cars with Ford Motor Co, declined to comment. BAIC BluePark did not respond to repeated requests for comment.

Shares of Changan’s main listed company Chongqing Changan Automobile rose 8% after Reuters reported the discussions. BluePark’s shares jumped by their maximum 10% daily limit.

GROWING EV MARKET

Chinese technology firms have been stepping up their focus on EVs in the world’s biggest market for such vehicles, as Beijing heavily promotes greener vehicles as a means of reducing chronic air pollution.

Sales of new energy vehicles (NEVs), including pure battery electric vehicles as well as plug-in hybrid and hydrogen fuel cell vehicles, are expected to make up 20% of China’s overall annual auto sales by 2025.

Industry forecasts put China’s NEV sales at 1.8 million units this year, up from about 1.3 million in 2020.

Huawei’s ambitious plans to make its own cars will see it join a raft of Asian tech companies that have made similar announcements in recent months, including Baidu Inc and Foxconn.

“The novel and complicated U.S. restrictions on semiconductors to Huawei have slowly been strangling the company,” said Dan Wang, a technology analyst with research firm Gavekal Dragonomics.

“So it makes sense that the company is pivoting to less chip-intensive industries in order to maintain operations.”

In the United States, Amazon.com Inc and Alphabet Inc are also developing auto-related technology or investing in smart-car startups.

Huawei has been developing a swathe of technologies for EVs for years including in-car software systems, sensors for automobiles and 5G communications hardware.

The company has also formed partnerships with automakers such as Daimler AG, General Motors Co and SAIC Motor to jointly develop smart auto technologies.

It has accelerated hiring of engineers for auto-related technologies since 2018.

Huawei was awarded at least four patents related to EVs this week, including methods for charging between electric vehicles and for checking battery health, according to official Chinese patent records.

Huawei’s push into the EV market is currently separate from a joint smart vehicle company it co-founded along with Changan and EV battery maker CATL in November, two of the sources said.

(Reporting by Julie Zhu in Hong Kong and Yilei Sun in Beijing; additional reporting by David Kirton in Shenzhen; Editing by Sumeet Chatterjee and Richard Pullin)

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Facebook switches news back on in Australia, signs content deals

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Facebook switches news back on in Australia, signs content deals 2

By Renju Jose and Jonathan Barrett

SYDNEY (Reuters) – Facebook Inc ended a one-week blackout of Australian news on its popular social media site on Friday and announced preliminary commercial agreements with three small local publishers.

The moves reflected easing tensions between the U.S. company and the Australian government, a day after the country’s parliament passed a law forcing it and Alphabet Inc’s Google to pay local media companies for using content on their platforms.

The new law makes Australia the first nation where a government arbitrator can set the price Facebook and Google pay domestic media to show their content if private negotiations fail. Canada and other countries have shown interest in replicating Australia’s reforms.

“Global tech giants, they are changing the world but we can’t let them run the world,” Australian Prime Minister Scott Morrison said on Friday, adding that Big Tech must be accountable to sovereign governments.

Facebook, whose 8-day ban on Australian media captured global attention, said it had signed partnership agreements with Schwartz Media, Solstice Media and Private Media. The trio own a mix of publications, including weekly newspapers, online magazines and specialist periodicals.

Facebook did not disclose the financial details of the agreements, which will become effective within 60 days if a full deal is signed.

“These agreements will bring a new slate of premium journalism, including some previously paywalled content, to Facebook,” the social media company said in a statement.

The non-binding agreements allay some fears that small Australian publishers would be left out of revenue-sharing deals with Facebook and Google.

“It’s never been more important than it is now to have a plurality of voices in the Australian press,” said Schwartz Media Chief Executive Rebecca Costello.

Facebook on Tuesday struck a similar agreement with Seven West Media, which owns a free-to-air television network and the main metropolitian newspaper in the city of Perth.

The Australian Broadcasting Corp has said it was also in talks with Facebook.

Google Australia managing director Mel Silva said in a statement published on Friday the company had found a “constructive path to support journalism”.

She thanked Australian users of the search engine for “bearing with us while we’ve sent you messages about this issue”.

Facebook and Google threatened for months to pull core services from Australia if the media laws, which some industry players claim are more about propping up ailing local media, took effect.

While Google struck deals with several publishers including News Corp as the legislation made its way through parliament, Facebook took the more drastic step of blocking all news content in Australia.

That stance led to amendments to the laws, including giving the government the power to exempt Facebook or Google from mandatory arbitration, and Facebook on Friday began restoring the Australian news sites.

(Reporting by Renju Jose and Jonathan Barrett; Editing by Richard Pullin and Jane Wardell)

 

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China’s factory activity growth likely moderated during February holiday lull – Reuters poll

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China's factory activity growth likely moderated during February holiday lull - Reuters poll 3

BEIJING (Reuters) – China’s factory activity likely grew at a slightly slower rate in February as factories closed for the Lunar New Year holiday, a Reuters poll showed, although growth is expected to remain firm, buoyed by an early resumption of production.

The official manufacturing Purchasing Manager’s Index (PMI) is expected to dip marginally to 51.1 in February from 51.3 in January, according to the median forecast of 20 economists polled by Reuters. A reading above 50 indicates an expansion in activity on a monthly basis.

Chinese factories typically scale back operations or close for lengthy periods around the Lunar New Year holiday, which fell in the middle of February this year.

However, the resurgence of COVID-19 cases in the winter had prompted local governments and companies to dissuade workers from travelling back to their hometowns, giving a boost to the earlier-than-usual resumption of production at many factories, analysts say.

“Although government COVID-19 prevention measures may constrain some manufacturing activities in the near-term, the fact that a majority of migrant workers stayed in their workplace cities for the holiday should facilitate an earlier resumption of business activity following the holiday this year,” said analysts at Nomura in a note to client on Thursday.

Wang Zhishen, a migrant worker from Gansu, told Reuters that his factory, a manufacturer of logistics boxes in the manufacturing hub of Dongguan, only closed for three days during the holiday, thanks to overwhelming businesses. Lured by the 1,500-yuan cash subsidy his factory offered, he chose to work through the holiday.

The Chinese economy has largely shaken off the gloom from the COVID-19 health crisis, with consumers opening up their wallets after months of hesitation. Growth is now set to rebound sharply this quarter, also helped by the low base effect of a year ago.

The country has successfully curbed the domestic transmission of the COVID-19 virus in northern China, with the national health authority reporting zero new local cases for the 11th straight day. Cities that were on lockdown have since vowed to push for a work resumption at full speed.

The official PMI, which largely focuses on big and state-owned firms, and its sister survey on the services sector, will both be released on Sunday.

The private Caixin manufacturing PMI will be published on Monday. Analysts expect the headline reading will dip slightly to 51.4 from 51.5 in January.

(Reporting by Stella Qiu and Ryan Woo; Editing by Sam Holmes)

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