Last updated: 16 Mar 2025 09:00 Posted in: AIA
Andrea Piras explains the top 12 things to consider when you are looking for the right way to achieve a net zero future.
Carbon accounting and reporting are no longer optional for businesses. Whether you’re an SME or a large corporation, understanding and managing your carbon footprint is essential – not just for staying competitive but also for complying with a growing list of regulations.
From Streamlined Energy and Carbon Reporting (SECR) to the Corporate Sustainability Reporting Directive (CSRD), and requirements like the Public Procurement Notice 06/21, businesses are increasingly obligated to provide transparent and accurate carbon data. Additionally, companies seeking to improve their B Corp scores or gain competitive advantage through certifications will benefit from a robust carbon accounting system.
However, the path to accurate carbon reporting can be full of pitfalls. To help you navigate, we’ve compiled a list of essential dos and don’ts that will ensure your carbon accounting efforts are transparent, credible, and impactful.
Why carbon accounting matters for your business
Before diving into the specifics, it’s important to understand why carbon accounting should be at the top of your business agenda (see tinyurl.com/ yhjfy48w). Accurate carbon emissions measurement forms the foundation of your Net Zero strategy, enabling you to set realistic targets, track progress and communicate achievements to stakeholders.
Accurately calculating your emissions is crucial to establish a complete baseline for your carbon reduction efforts. To get a full picture, it’s important to account for all sources of emissions, including direct (Scope 1), indirect (Scope 2), and value chain emissions (Scope 3).
Many platforms rely on broad, spend-based estimates, but Net Zero Now offers a more precise approach by using detailed, activity-based data. This ensures a more accurate measurement of your carbon footprint, giving you a strong foundation to set actionable and impactful reduction targets. The Net Zero Now platform simplifies this process with sector-specific guidance and ensures a high level of accuracy in your reporting.
Businesses risk losing credibility by making unfounded or vague claims about their carbon neutrality or sustainability. Often, companies claim carbon neutrality based only on Scope 1 and Scope 2 emissions, which are typically much smaller compared to Scope 3 emissions.
This can lead to misleading perceptions. In fact, it’s advisable to avoid making carbon neutrality claims altogether, as they don’t necessarily require actual emissions reductions. Instead, focus on claims around emissions reduction targets or Net Zero goals that are tied to a specific timeframe and address all relevant emission scopes. These claims are far more credible and reflect a genuine commitment to sustainability. commitment to sustainability.
As Harry Llewellyn, Head of Climate Services at Net Zero Now, says: ‘Businesses often get tripped up by trying to race towards Net Zero without ensuring their data is comprehensive and accurate. Start with robust calculations and then make your move.’
Dos for effective carbon accounting: how to work towards net zero
Use the right protocols and standards
It’s not enough to just track your emissions – you need to do so in a way that meets industry and regulatory standards.
Protocols tailored to your sector help to ensure that your carbon accounting aligns with globally recognised standards, such as the Greenhouse Gas Protocol, which is the foundation for accurate emissions measurement.
Furthermore, the emissions reduction targets suggested by Net Zero Now are designed to align with Science-Based Targets initiative (SBTi) guidance, ensuring that your goals are scientifically robust and aligned with global climate objectives. This approach makes your claims more credible and easier to communicate to stakeholders, helping you to build trust and confidence.
Using a dedicated carbon accounting platform not only simplifies the process of tracking and reporting your emissions but also saves you a significant amount of time. These platforms are built to handle the intricacies of carbon accounting, reducing the likelihood of errors and streamlining workflows that would otherwise be tedious and time-consuming with manual spreadsheets.
With automated tools guiding you step by step, you’ll ensure accuracy while freeing up valuable time to focus on your broader sustainability strategy and other business priorities.
Set science-based targets
Setting emissions reduction targets isn’t just a best practice – it’s necessary for meaningful progress.
Science-based targets ensure that your business is aligned with global climate goals, giving your efforts a clear direction and making them more impactful. These targets should be ambitious yet realistic so as to create tangible environmental and commercial benefits.
Monitor and update your data regularly
As your business grows or changes, so will your emissions profile, making it essential to stay consistent with your reporting practices.
Staying consistent with annual emissions reporting ensures that your carbon strategy remains aligned with your evolving operations. Each year, look for ways to improve the accuracy of your footprint measurement by refining your data sources. For example, progress from using spend-based data (such as total spend on flights) to activity-based data (like flight mileage broken down by seat class).
Eventually, aim to move towards supplier-specific data, which provides even more precision in calculating your emissions. This iterative process will help to ensure your carbon reduction efforts are both credible and effective over time.
Don’ts for avoiding carbon accounting Pitfalls
Don’t over-rely on carbon offsets
While carbon offsets and carbon credits can help to mitigate unavoidable emissions, they should not be your primary method for achieving Net Zero.
Offsets should complement your emissions reduction efforts, not replace them. Over-reliance on offsets can undermine your credibility and reduce the overall impact of your actions.
When purchasing offsets, make sure the carbon credits you choose are of high quality and tied to projects that are verified and audited. Additionally, we recommend investing in carbon removal credits, which actively remove carbon from the atmosphere despite their higher cost. This approach ensures that your offset strategy is both credible and aligned with long-term sustainability goals.
Don’t forget Scope 3 emissions
Many businesses make the mistake of focusing solely on direct emissions, overlooking the significant impact of Scope 3 emissions.
Scope 3 emissions, such as those from your supply chain, product lifecycle and other indirect activities, often make up the majority of your overall emissions. Ensure that you include these in your reporting to provide a more comprehensive and accurate picture of your carbon footprint. Additionally, when making public commitments about your emissions measurement or reduction targets, always be transparent about which emission scopes – Scope 1, Scope 2 and Scope 3 – are being addressed. This clarity is essential for credibility and for setting meaningful reduction goals.
Reporting and communicating your carbon progress
Communicate clearly and regularly
In today’s market, transparency is a key differentiator. Your carbon accounting and reduction efforts should be communicated regularly to build trust with your stakeholders.
Clear and regular communication not only builds credibility but also helps to attract customers, employees and investors. When communicating, ensure that you provide a comprehensive narrative that includes your efforts to date, your current progress and your ambitions for the future. This balanced approach gives stakeholders a clear picture of where your business stands and where it’s headed, further enhancing your reputation for sustainability.
Celebrate milestones
Your journey to Net Zero deserves to be acknowledged and shared.
Showcasing your progress can serve as inspiration for others in your industry and enhance your brand’s reputation.
Avoid greenwashing
With rising awareness around sustainability, consumers and employees are paying closer attention to companies’ environmental claims. Exaggerating your green efforts can backfire.
Ensure that all your sustainability claims are backed by accurate data and credible actions. Greenwashing – making misleading claims about environmental efforts – can severely damage your reputation and erode trust. To build lasting credibility, be transparent and honest about the progress and challenges in your sustainability journey.
Don’t fall into the greenhushing trap
Just as dangerous as greenwashing is greenhushing – staying silent about your sustainability efforts to avoid scrutiny.
Greenhushing, while seemingly a safe strategy, can lead to missed opportunities and erode trust. Being open about both your successes and challenges is key. As Harry Llewellyn, Head of Climate Services at Net Zero Now, notes: ‘Don’t let perfect be the enemy of good! All progress in the right direction should be communicated openly, and we find this openness often stimulates further action.’
Turn carbon accounting into a competitive advantage
Carbon accounting and reporting are fundamental components of a credible Net Zero strategy. By following these dos and don’ts, your business can ensure that its efforts are accurate, transparent and impactful.
Begin your journey with trusted tools from AIA partner, Net Zero Now platform, and you’ll build a future-proof, competitive business in the rapidly evolving Net Zero economy.
Originally published by NetZeroNow.
Author bio
Andrea Piras is Head of Demand Generation at NetZeroNow. He is passionate about the environment and climate change, and is the founder of Treeonfy.
Net Zero Now
Net Zero Now is dedicated to helping businesses across the accountancy industry transition to Net Zero by offering a clear, standardised pathway to reduce and offset emissions.
Recognising the complexity of carbon accounting and the unique needs of businesses, Net Zero Now has developed, in partnership with the Association of International Accountants (AIA), the Net Zero Accountancy Protocol – a practical, science-backed framework that guides firms through measuring, mitigating and communicating their emissions.
By aligning with global climate goals, Net Zero Now empowers firms to achieve certification and leverage their Net Zero commitment as a competitive advantage, positioning them as leaders in sustainability in a rapidly changing market.
