Compliance Reporting = Robust Data = Business Value and Opportunities
Compliance reporting provides the opportunity to strategically position your business and differentiate yourself in the market. Benchmarking and the identification of risks and opportunities are only the tip of the iceberg.
What should my business be doing?
Your organisation has the data; it is complete, accurate and verified – so what next?
Now is the time to decide your company’s strategic position in your industry (compliant, forward thinker, leader).
Your data should form the basis of internal strategic planning – where and how do you want to take your business in a future carbon-constrained economy? How will the carbon price affect you, your stakeholders, customers and suppliers, and your industry? Do you understand your energy and emissions profile? What do you need to have in place for continued success?
Access to complete data sets allows for different and robust scenario planning. Information can be easily and regularly manipulated, reviewed and revisited. In the current climate, businesses should assess and understand where their market may go with the introduction of a fixed or volatile carbon price (or even with a cap-and-trade scheme). There may be benefits in reviewing and/or changing the branding of your product or service. A number of opportunities may exist.
Data is key for benchmarking. Organisations should benchmark their products and services (and even the way they do business) against known competitors and peers to identify areas for successful differentiation and to create new business opportunities. This may occur through change in a product suite; by focusing on and developing solutions or services rather than products; or considering and developing a carbon focused marketing strategy.
Drive business improvement through regularly updating your data. This provides timely information rather than just an annual review where the information is “old”. Integrating with business reporting, dashboards and KPIs ensuring a continuous improvement approach to business operations.
Drive down your operating and production costs through the use of abatement cost curves. Understanding where you are going through forward planning and forecasting has never been a waste of energy.
So what value is created from reporting beyond achieving compliance?
A robust, accurate and verified dataset that captures information across the business (financial to carbon/sustainability) can assist the business in a number of areas. Specifically, risk and opportunity or solution identification and the development of in-house strategies help businesses to manage their internal and external risks.
With the proposed introduction of a carbon price, understanding how this will affect your business and planning for its impact is key. It will affect your bottom line or that of your customers, alter how you produce or procure goods and services, and potentially change your current business model.
If you want to stay ahead of the pack in a future carbon-constrained economy, forward planning through effective and efficient forecasting is essential. Good data will facilitate this process, allow for you to benchmark your progress, assess your product and service offerings against those of your competitors and gain competitive advantage by understanding better what you can provide and what the market wants.
A single, integrated dataset provides for sophistication in reporting which allows for improved levels of disclosure to stakeholders and the public. It provides investors with the confidence that you have good internal controls, are in a position to make smart business decisions, and have assessed the broader community business needs.
Basics of compliance and voluntary reporting
If you are captured under an Act such as Energy Efficiency Opportunities (EEO) or the National Greenhouse and Energy Reporting (NGER) Act, then you are captured. No getting out of jail free. What that means is the collection of significant amounts of data, the potential for penalties and a few panicked executives. On a positive note, this level of disclosure and transparency can provide potential investors with confidence in your management culture.
The outcome of compliance reporting is the start of a dataset that can prove to be very valuable. Capturing all the required compliance information in one consolidated format will help reduce the cost and burden of repeated and fragmented data collection, improve the overall accuracy of the data (thereby facilitating and simplifying external audits), provide your Board and Executives with desirable confidence in the numbers, and can save time in preparing multiple reports.
It also provides the opportunity for faster identification and filling of data gaps and addressing any inconsistencies. Further, the information can be used to support additional voluntary reporting in which your organisation participates, including the Carbon Disclosure Project (CDP), internal and external CSR and environmental reports, and more.