September 13, 2021



The FRC have recently carried out a thematic review of Streamlined Energy and Carbon Reporting in Financial Statements, recommending 5 areas of focus:


Entities are not required to follow a set regulated approach when calculating emissions and energy consumption. This makes it imperative that organisations fully describe the methodology used and any judgments and assumptions when following this.

It is also important in a group situation to make it clear which entities are within the scope of reporting and how this was determined


Each entity must decide which intensity metric is most appropriate to their industry and business when calculating their ratios. Some entities may consider the level of revenue when looking at their tonnes of CO2e (TCO2e), whereas other organisations may use floor space, number of employees or operational output. It is important to consider what is strategically important to the business and what drives the generation of TCO2e when making this decision.

Principal Measures

The narrative supporting the disclosed figures should set out the action that is being taken to reduce the level of TCO2e for future periods. This should separate action which was undertaken during the past year as well as that which is for the longer term. There should also be a focus on the principal actions taking place, being those which will have the biggest impact, rather than there being an exhaustive list of each and every effort.

Integrated Reporting

To make the SECR relevant it is best practice to integrate the report into other areas of the financial statements. This could be a link to the principal risks and uncertainties in the Strategic Report or to the notes.

Consideration should also be given to other recommendations such as those within the Taskforce on Climate-related Financial Disclosures (TCFD), although this is an optional framework for now it will require a comply or explain the approach for periods commencing 1 January 2021 for premium listed entities with the government has stated that it also intends to bring other organisations within this remit in the future.


At present there is no requirement for entities to get their TCO2e data independently verified, however some organisations do so on a voluntary basis. Obtaining assurance over the accuracy and completeness of the data is however recommended as this not only gives comfort to those relying on the data internally but it is also seen as a positive to external stakeholders as well.


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