CARBON FOOTPRINT REPORTING

 

GREENHOUSE GAS (“GHG”) EMISSIONS
CARBON FOOTPRINT REPORTING

Generally accepted GHG accounting principles can be likened to those of financial accounting and reporting. They serve to underpin and guide GHG accounting and reporting, to ensure that the reported information represents a faithful, true, and fair account of an organisation’s GHG emissions. These principles also facilitate data that is accurate and comparable from year to year, across multiple entities.

Using GHG information, businesses can track and compare emissions data over time, which helps to identify trends and assess performance. To produce comparable GHG emissions data over time, both from inventories and other reporting organisations, it is essential to consistently apply accounting approaches, inventory boundary, and calculation methodologies.

To be accurate, companies must compile the GHG information for all operations in a way that ensures the aggregate information is internally consistent and comparable over time. If there are changes in the inventory boundary, methods, data, or any other factors affecting emission estimates, these must be transparently justified, documented, and disclosed.

 

CHANGE IN REPORTING
METHODOLOGY

Emira has recorded and disclosed its carbon footprint using the equity share approach since FY2014. At that time, the Fund directly held most of its 141 properties and had total operational control over each property. Under the equity share approach, Emira accounted for all GHG emissions from operations according to its share of ownership in each property under its Scope 1 and 2 emissions.

The Fund has evolved, with the formation of Enyuka and Inani and investments into the US and Transcend. In order to be comparable and appropriate, Emira’s reporting methodology also needed to evolve. To this end, the Fund’s auditors recommended using the financial control reporting methodology as of FY2020.

The financial control approach records emissions of properties over which Emira has operational influence. This refers to the Fund’s directly held South African portfolio and Enyuka, under its Scope 1 and 2 emissions. Emissions from investments where Emira is either a minority shareholder or has no operational control over the property, are recorded under the Company’s Scope 3 emissions. These include Emira’s investments in Inani, Transcend and the US.

 

GOING FORWARD

This approach will align the Fund’s reporting in terms of the developing carbon tax obligations, while allowing the Company to develop an internal cost of carbon that is relevant to the properties in its South African portfolio.

 

A comparison of Emira’s audited FY2019 carbon footprint disclosure is included below to demonstrate the impact of changing its approach to reporting.

 

FY2019 FOOTPRINT — EQUITY SHARE APPROACH
GHG INVENTORY (tCO2 e)

 

FY2019 COMPARISON AND FY20 FOOTPRINT — FINANCIAL CONTROL APPROACH
GHG INVENTORY (tCO2 e)

 

WASTE MANAGEMENT INCLUDED

During the year under review, Emira has included waste disposal in its disclosure report for the first time. Recycling has been implemented at the majority of Emira’s retail shopping centres and the further rollout to the commercial and industrial portfolios remains a focus going forward.

 

CDP

Previously known as the Carbon Disclosure Project, CDP runs a global disclosure system that enables companies, cities, states and regions to measure and manage their environmental impacts. CDP has put together the most comprehensive collection of self-reported environmental data in the world. With combined assets of USD96 trillion, the CDP’s global network of users, investors and policy makers use the data and insights to make better, more informed decisions.

Emira has made its tenth CDP submission and currently awaits a score.

 

UNDERSTANDING EMIRA’S CDP SCORE

In terms of performance, average CDP scores are as follows:

› Financial services: C
› Africa: B+
› Global average: C
› Emira’s score: B demonstrates that the Fund is taking coordinated action on climate issues

 

KEY CDP FOCUS AREAS

› Initiatives throughout the local portfolio to reduce Emira’s carbon footprint and Scope 1 and 2 emissions.
› Recognising the impact of Emira’s Scope 3 emissions and working with joint venture partners to implement carbon reduction strategies where applicable.

 

CARBON REDUCTION TARGETS WITH SBti

Emira is the first company in Africa to have its science-based carbon reduction targets approved by SBTi, in alignment with the Paris Accord to a 2ºC reduction scenario. Subsequently, the Fund has been in discussion with SBTi to upgrade its targets to the more ambitious 1,5ºC scenario.

 

0,5°C MAKES A BIG DIFFERENCE

In terms of consequences for the planet, the difference between 1,5°C and 2°C is vast. Restricting global warming to 1,5°C could result in 11 million fewer people being exposed to extreme heat, with 61 million fewer people exposed to drought, and 10 million fewer people impacted by rising sea levels.

In addition to these human benefits, the number of vertebrate and plant species facing severe range loss by the end of the century could be reduced by 50%. Studies show that the value of services provided by a functioning biosphere averages approximately USD125 trillion a year. This suggests that restricting warming to 1,5°C could help to avoid more severe global economic losses.

The business case for maintaining warming at 1,5°C is a more economically stable world.

Companies could benefit from more secure supply chains that are less susceptible to flood and extreme weather risks. In addition, workforces would be healthier and safer by being less exposed to extreme heat, water scarcity and food shortages. Furthermore, operations would be more stable by being significantly less at risk of dramatic changes to water supplies. From the supply chain to the consumer, every part of a company’s value chain stands to benefit from limiting global warming to 1,5°C.

 

CARBON FOOTPRINT REPORTING

 

GREENHOUSE GAS (“GHG”) EMISSIONS
CARBON FOOTPRINT REPORTING

Generally accepted GHG accounting principles can be likened to those of financial accounting and reporting. They serve to underpin and guide GHG accounting and reporting, to ensure that the reported information represents a faithful, true, and fair account of an organisation’s GHG emissions. These principles also facilitate data that is accurate and comparable from year to year, across multiple entities.

Using GHG information, businesses can track and compare emissions data over time, which helps to identify trends and assess performance. To produce comparable GHG emissions data over time, both from inventories and other reporting organisations, it is essential to consistently apply accounting approaches, inventory boundary, and calculation methodologies.

To be accurate, companies must compile the GHG information for all operations in a way that ensures the aggregate information is internally consistent and comparable over time. If there are changes in the inventory boundary, methods, data, or any other factors affecting emission estimates, these must be transparently justified, documented, and disclosed.

 

CHANGE IN REPORTING
METHODOLOGY

Emira has recorded and disclosed its carbon footprint using the equity share approach since FY2014. At that time, the Fund directly held most of its 141 properties and had total operational control over each property. Under the equity share approach, Emira accounted for all GHG emissions from operations according to its share of ownership in each property under its Scope 1 and 2 emissions.

The Fund has evolved, with the formation of Enyuka and Inani and investments into the US and Transcend. In order to be comparable and appropriate, Emira’s reporting methodology also needed to evolve. To this end, the Fund’s auditors recommended using the financial control reporting methodology as of FY2020.

The financial control approach records emissions of properties over which Emira has operational influence. This refers to the Fund’s directly held South African portfolio and Enyuka, under its Scope 1 and 2 emissions. Emissions from investments where Emira is either a minority shareholder or has no operational control over the property, are recorded under the Company’s Scope 3 emissions. These include Emira’s investments in Inani, Transcend and the US.

 

GOING FORWARD

This approach will align the Fund’s reporting in terms of the developing carbon tax obligations, while allowing the Company to develop an internal cost of carbon that is relevant to the properties in its South African portfolio.

 

A comparison of Emira’s audited FY2019 carbon footprint disclosure is included below to demonstrate the impact of changing its approach to reporting.

 

FY2019 FOOTPRINT — EQUITY SHARE APPROACH
GHG INVENTORY (tCO2 e)

 

FY2019 COMPARISON AND FY20 FOOTPRINT — FINANCIAL CONTROL APPROACH
GHG INVENTORY (tCO2 e)

 

WASTE MANAGEMENT INCLUDED

During the year under review, Emira has included waste disposal in its disclosure report for the first time. Recycling has been implemented at the majority of Emira’s retail shopping centres and the further rollout to the commercial and industrial portfolios remains a focus going forward.

 

CDP

Previously known as the Carbon Disclosure Project, CDP runs a global disclosure system that enables companies, cities, states and regions to measure and manage their environmental impacts. CDP has put together the most comprehensive collection of self-reported environmental data in the world. With combined assets of USD96 trillion, the CDP’s global network of users, investors and policy makers use the data and insights to make better, more informed decisions.

Emira has made its tenth CDP submission and currently awaits a score.

 

UNDERSTANDING EMIRA’S CDP SCORE

In terms of performance, average CDP scores are as follows:

› Financial services: C
› Africa: B+
› Global average: C
› Emira’s score: B demonstrates that the Fund is taking coordinated action on climate issues

 

KEY CDP FOCUS AREAS

› Initiatives throughout the local portfolio to reduce Emira’s carbon footprint and Scope 1 and 2 emissions.
› Recognising the impact of Emira’s Scope 3 emissions and working with joint venture partners to implement carbon reduction strategies where applicable.

 

CARBON REDUCTION TARGETS WITH SBti

Emira is the first company in Africa to have its science-based carbon reduction targets approved by SBTi, in alignment with the Paris Accord to a 2ºC reduction scenario. Subsequently, the Fund has been in discussion with SBTi to upgrade its targets to the more ambitious 1,5ºC scenario.

 

0,5°C MAKES A BIG DIFFERENCE

In terms of consequences for the planet, the difference between 1,5°C and 2°C is vast. Restricting global warming to 1,5°C could result in 11 million fewer people being exposed to extreme heat, with 61 million fewer people exposed to drought, and 10 million fewer people impacted by rising sea levels.

In addition to these human benefits, the number of vertebrate and plant species facing severe range loss by the end of the century could be reduced by 50%. Studies show that the value of services provided by a functioning biosphere averages approximately USD125 trillion a year. This suggests that restricting warming to 1,5°C could help to avoid more severe global economic losses.

The business case for maintaining warming at 1,5°C is a more economically stable world.

Companies could benefit from more secure supply chains that are less susceptible to flood and extreme weather risks. In addition, workforces would be healthier and safer by being less exposed to extreme heat, water scarcity and food shortages. Furthermore, operations would be more stable by being significantly less at risk of dramatic changes to water supplies. From the supply chain to the consumer, every part of a company’s value chain stands to benefit from limiting global warming to 1,5°C.