UK businesses will have to report their emissions data from 2013, Deputy Prime Minister and leader of the Liberal Democrat party, Nick Clegg, announced today (20 June) at the Rio+20 Summit.

New regulations to be introduced from April 2013 will make it mandatory for approximately 1,800 businesses listed on the main market of the London Stock Exchange to report their levels of greenhouse gas emissions, making the UK the first country to make it compulsory for companies to disclose their emissions data in their annual reports.

The new regulations are part of the UK’s commitment to cut carbon emissions to 50 per cent of 1990 levels by 2025. It is hoped that publically disclosing the greenhouse gas emissions of businesses will allow investors to see which companies are effectively managing the hidden long-term costs of greenhouse gas emissions, and also actively encourage businesses to reduce their carbon footprint. It is estimated the regulations could save four million tonnes of CO2 emissions by 2021.

“Counting your business costs while hiding your greenhouse gas emissions is a false economy. British companies need to reduce their harmful emissions for the benefit of the planet, but many back our plans because being energy efficient makes good business sense too. It saves companies money on energy bills, improves their reputation with customers and helps them manage their long-term costs too”, said Nick Clegg at the Rio+20 summit.

The announcement comes after a consultation process with businesses and individuals saw the majority voice their support for the new government plans. If successful, the regulations will be reviewed in 2015 to see the possibility of extending the mandate to all large companies in 2016.

Andrew Raingold, Executive Director of the Aldersgate Group, said: “The vast majority of businesses strongly welcome the introduction of mandatory carbon reporting. This is an area where corporate executives have been demanding more regulation from government to provide greater clarity and transparency.”

Raingold also outlined that the Aldersgate Group had undertaken “detailed analysis” of the proposed regulations and found that they would “lead to huge cost savings for businesses”.

According to those consulted, the compulsory approach would: provide the first step in enabling companies to manage and reduce emissions; mean more transparency from companies; provide a single consistent standard; and provide information to the businesses that could save them money through reduced energy costs.

Secretary of State for the Environment Caroline Spelman welcomed the regulations, saying: “The discussions we’ve had with businesses show that they want to cut down their greenhouse gas emissions, and they want to be open and transparent about it. What they have asked for is a level playing field so that they can be fairly judged against one another, and we have delivered that today.”

Secretary of State for Energy and Climate Change Edward Davey also welcomed the announcement, saying that the introduction of the mandatory reporting will build on the regulatory framework established by the CRC Energy Efficiency Scheme for the largest energy users.

Further information on greenhouse gas reporting can be found on the Defra website.