Greenhouse Gas (GHG) Emissions Topic Methodology

As part of our development of an impact accounting methodology, IFVI in partnership with the Value Balancing Alliance (VBA) releases the exposure draft for the Greenhouse Gas (GHG) Emissions Topic Methodology for public comment from February 8 to April 30.

Public Comment

We’re interested in hearing from you! Download and review the GHG Topic Methodology and follow the instructions to submit a comment beginning on page 10.

Submitted comment letters for this exposure draft are published here on a rolling basis.

Deadline to submit is April 30

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Introduction

The accumulation of GHG emissions in the atmosphere not only alters our physical environment, with rising temperatures and sea levels and more extreme weather events, but also reduces the well-being for all of us. These changes are becoming more unpredictable in their frequency and magnitude, adding further risks to corporates and investors.

The GHG Topic Methodology guides preparers of impact accounts to measure and value, in currency, the impact of a company’s GHG emissions on people and the planet. Ultimately, the methodology encourage companies whose GHG emissions are material to manage and reduce their emissions.

The content of the GHG Topic Methodology builds on IFVI & VBA’s General Methodology 1: The Conceptual Framework for Impact Accounting and will be complemented by other Topic and Industry-specific Methodologies.

 

Highlights

  • The methodology accounts for all GHGs emitted in Scope 1, 2, and 3 as defined by the GHG Protocol.
  • The data expected from preparers of impact accounts aligns fully with data already reported through ESRS E1: Climate Change, IFRS S2: Climate-related Disclosures, and GRI 305: Emissions 2016.
  • The methodology establishes a social cost of carbon of USD 236 (2023), based on the two leading models produced by the Climate Impact Lab and Resources for the Future, DSCIM and GIVE, respectively.
  • The methodology acknowledges the relevance of qualitative information to supplement quantitative results as part of impact accounting, including how the quantitative results relate to performance targets and planetary boundaries.
  • The methodology does not account for avoided emissions, emissions reductions targets, renewable energy credits, or GHG offset projects, whether developed within the value chain or purchased through carbon credits. Future work plans may develop approaches to address each of these.

 

Influences

The development of this methodology builds on frameworks and protocols published by leading organizations in the impact management ecosystem and sustainability-related disclosures required by governing jurisdictions and international standard setters, including: