Sophisticated online fleet management tools are enabling businesses to meet new mandatory carbon reporting regulations that take effect from October 1, 2013.
Fleets and leasing companies using Jaama’s Key2 Vehicle Management system are able to calculate their vehicle carbon footprint and thus comply with the new Greenhouse Gas Emissions (Directors’ Reports) Regulations 2013.
Under the Regulation – made under the Companies Act 2006 – approximately 1,800 companies listed on the London Stock Exchange will be subject to the new Regulation, which could be extended to all large companies – a potential 31,000 businesses – from April 2016*.
The requirement means that annual company reports for years ending on or after September 30, 2013 must highlight organisation’s greenhouse gas emission including emissions from vehicles ‘owned or controlled’ by companies including cars, vans and HGVs.
However the Regulation excludes the mandatory reporting of business travel by means ‘not owned or controlled by the organisation’, including employees driving their own vehicles on business trips. The Government says it excluded such journeys due to logistical difficulties and the administration burden. Nevertheless, it is asking companies to voluntarily report emission levels linked to such vehicle use and Key2 automatically calculates this when grey fleet data is stored on the system.
Using individual vehicle CO2 emissions and reported mileage, organisations can use Jaama’s technology to ‘slice and dice’ reports to show CO2 tonnage for an individual vehicle, a group of vehicles or the entire fleet for any specific period of time linked to past, current and projected mileage.
Contract hire and leasing company Ogilvie Fleet was the first company to introduce Jaama’s customer dashboard. Via this sophisticated online fleet manager portal branded MiFleet Showroom, customers are able to:
Obtain a vehicle quote containing a model’s CO2 emission figure and anticipated emitted carbon tonnage over the contract period
Obtain a real time average CO2 figure for their fleet
Drill down to calculate carbon tonnage on a vehicle-by-vehicle and whole fleet basis across any specific period of time
Ogilvie Fleet sales and marketing director Nick Hardy said: “We integrated carbon reporting at the development stage of MiFleet Showroom four years ago because it is important criteria for our customers.
The reporting facility enables our customers to have a snapshot of individual vehicle emission levels and the carbon footprint of their entire fleet at any moment in time.”
Customers of JCT600 Contracts, which also uses Jaama’s Key2 system, can request an automatic carbon report on their fleet. The report highlights:
Individual vehicle CO2 tonnage across the contracted mileage, for example three years/60,000 miles
Actual CO2 tonnage of a vehicle at last recorded mileage
CO2 tonnage at last recorded mileage and then projected forward to contract end taking account of whether vehicle is under or over mileage
Brian Kirby, systems director, JCT600 Contracts, said: “Carbon reporting was delivered manually, but now customers can schedule reports to be delivered at a frequency of their choosing.
“We are currently highlighting carbon reporting to our customers and believe a lot of organisations will request this service, particularly larger businesses where corporate social responsibility is a board level issue. However, we are making it an ‘opt in’ service as we don’t want customers to suffer from information overload.”
Similarly, Fleet Hire, via its Jaama-developed online customer dashboard, is able to provide carbon footprint data with clients being able to calculate individual vehicle and fleet-wide CO2 levels.
Fleet Hire sales director Nick Poole said: “Our larger customers are interested in reporting their carbon footprint because they have stakeholders to satisfy in terms of meeting corporate social responsibility requirements.
“Smaller businesses have an interest in CO2 levels and their carbon footprint because by reducing vehicle emissions they are saving money in fuel and tax costs.”
Regulation enforcement is being carried out by the Conduct Committee of the Financial Reporting Council and can apply to the courts for a declaration that a quoted company’s annual report does not comply with the applicable requirements. Under the provisions of the Companies Act, directors may face a fine if they knew that the directors’ report was non-compliant with the applicable requirements, or were reckless or failed to take reasonable steps to ensure compliance.
Jaama managing director Martin Evans said: “Carbon reporting is already a major issue for many businesses in respect of their corporate social responsibility agenda and the new Regulation only increases that demand.
“Overall the effect of introducing an emissions focus will be to operate a cleaner, greener fleet that potentially clocks up fewer miles thus cutting costs. Highlighting reductions in greenhouse gas emissions can also enhance a company’s reputation and brand value.”
Critically if businesses expand and subsequently the size of their fleet increases, Key2 is able to report average CO2 output and carbon tonnage on a per vehicle basis.
Mr Evans explained: “If a fleet increases in size then its carbon footprint is also likely to rise. Therefore the key metric is average CO2 tonnage per vehicle and the measures to consistently reduce that figure over time.
“Quantifying CO2 output is a challenge for all businesses, but Key2 with all CO2-related information consolidated in one portal makes accurate carbon reporting easier to achieve.”
The inclusion of greenhouse gas emission details in companies’ annual reports will, says the Government, enable investors and customers to see which companies are effectively managing their hidden long-term effects.
The UK is the first country to make it compulsory for companies to include emissions data for their entire organisation in their annual reports.
*A large company is defined by the Department for Business Enterprise and Regulatory Reform as one employing more than 250 people, with turnover above £22.8 million and gross assets above £11.4 million. Under the Companies Act 2006 to be classified as ‘large’ the company must meet the threshold for size on at least two of the three measures. The Government will conduct a review in 2015 to decide whether the reporting requirement should be extended to all large companies in 2016.