With evolving regulations and climate pressures pushing decarbonization initiatives as a global imperative, the Asia Pacific region has emerged as a leader in advancing net-zero ambitions. Novata recently hosted a webinar exploring the corporate carbon reporting landscape in APAC, common disclosure challenges, and best practices to address complex carbon reporting requirements.
Hosted by Kyle Flick, Head of APAC Advisory at Novata, and Rosalind Bazany, Head of ESG and Impact at Antler, the webinar covered how investors and companies can navigate what’s next for carbon reporting with confidence and clarity. Below are insights from their conversation.
1. APAC Accelerates Decarbonization Goals With Business-Driven Mindset
The APAC region accounts for 51% of global greenhouse gas emissions; but despite their hefty energy burdens, several countries are making remarkable strides in accelerating their transition to net-zero economies. Developing carbon markets, government-sanctioned carbon taxes, and the adoption of ISSB-aligned standards reflect the region’s commitment to achieving decarbonization targets. The reason behind this rapid progression is also incredibly pragmatic: business.
Antler’s Rosalind remarks that this transition is necessary due to APAC’s dependency on export-driven industries and key markets’ vulnerability to direct climate threats. “It’s simply about protecting economies and securing a competitive edge through transition finance,” she explains. With a historic reliance on fossil fuels, APAC countries are viewing carbon emissions through the lens of economic risk and opportunities, which has enabled them to advance their climate policies and milestones in tandem with national priorities.
2. Carbon Reporting Builds Resilient Businesses
Corporate carbon reporting is still largely viewed as a compliance exercise, with misconceptions on what it is meant to measure or how its data is valuable to investors or companies.
As demonstrated in APAC to much success, carbon reporting provides actionable business intelligence that drives competitive differentiation, which in turn builds more resilient businesses and sustainable economies. However, material factors should drive how and where carbon reporting can best enable strategic value. Our panellists shared the following ways carbon reporting can turn uncertainties into opportunities:
- Improved risk management: Accurate carbon accounting is pivotal to assessing and minimizing climate-related risks, enabling companies with the capacity to strengthen regulatory compliance, conduct due diligence, and mitigate the adverse impact of climate change on their operations.
- Reduced operational costs: By understanding their carbon footprint, companies are able to identify energy inefficiencies, optimize resource utilization, and access renewable energy sources for long-term savings.
- Supply chain resilience: Reducing Scope 3 emissions, either through circular economy practices or replacing carbon-intensive materials can build a more sustainable, cost-effective value chain.
- Enhanced financial performance: Not only can investors lower their capital costs, they are able to improve valuations, financial performance, or access new capital through sustainable finance.
3. Preparation Matters to Tackle Carbon Reporting Complexity
Concerns over sustainability reporting complexity has led the EU to introduce the Omnibus Package, which proposes significant amendments to the Corporate Sustainability Reporting Directive (CSRD), Corporate Sustainability Due Diligence Directive (CSDDD), and the EU Taxonomy. One proposed overhaul would reduce the number of companies in scope for the CSRD by 80%. Coupled with the rollback of the SEC’s Climate Disclosure rule in the US, it would seem that companies in some jurisdictions might be able to put their carbon reporting efforts on the back burner.
However, even without regulatory oversight, companies should not be lax in their emissions reporting—Rosalind argues that what isn’t material or mandatory today could be so in the future, and that preparation is key. She shared Antler’s phased-in approach to reduce reporting costs and complexity for its companies:
- Early-stage companies: Communicate the value of carbon reporting to stakeholders and portfolio companies by aligning it with broader business objectives. As a starting point, the focus should be on building awareness and capacity building, and understanding why tracking emissions is a necessity beyond regulations.
- Growth-stage companies: Companies should have tracking methods in place to begin measuring emissions and establish a baseline for carbon data.
- Series A: Capacity to track Scope 1 and 2 emissions
- Series B: Capacity to track Scope 1, 2, and 3 emissions in preparation for regulatory compliance, if needed. Carbon reporting insights should also be integrated into an organization’s overall sustainability strategy.
Novata’s Kyle also reassures that reporting processes don’t have to be perfect from the start, and that it is a reiterative process that improves with trial and error. “We’re all learning and we’re all figuring out the right approach, so make it right for you,” Rosalind adds. “Don’t be afraid to question, explore different options. You’ll find the right approach that really adds value to what you do as a company.”
Getting Started with Carbon Reporting
With or without regulatory oversight, carbon emissions reporting is a critical aspect of strengthening business resilience. Novata is here to help with our expertly guided, data-driven approach to tracking, measuring, and reducing your carbon impact. Get started by speaking to one of our experts or exploring some of our resources:
- Watch the webinar on-demand here.
- See the Novata Carbon Navigator in action.
- Get expert guidance from Novata’s Advisory team.
