This website will offer limited functionality in this browser. We only support the recent versions of major browsers like Chrome, Firefox, Safari, and Edge.

Explainer

How SECR provides a comprehensive view of business environmental impact

A picture of windmills

The Streamlined Energy and Carbon Reporting (SECR) framework launched in 2019 to simplify carbon reporting and increase transparency and accountability. SECR reporting is a crucial component for businesses that have goals to reduce their overall emissions. By utilising the carbon reporting framework effectively, businesses can gain a full picture of how their activities impact the environment and take steps to make meaningful change.

What is SECR?

SECR is a compliance scheme that requires large businesses in the UK to report annually on their energy consumption and greenhouse gas emissions. These reports must be included in the director’s reports to Companies House and are therefore visible to everyone. The implementation of SECR coincided with the termination of the legacy carbon reporting framework, the Carbon Reduction Commitment (CRC) energy efficiency scheme. SECR is viewed as a superior version to CRC because it simplified previous carbon reporting frameworks.

The implementation of SECR was an interesting turning point as it led with the concept that carbon reporting should be accessible to businesses, creating more opportunities for transparency and progress towards sustainability goals.

To find out if you meet the requirements, read our pocket guide to SECR.

What are the key components of SECR reporting?

Under the SECR framework, companies are required to report on various components of their energy consumption and associated GHG emissions. This includes Scope 1, 2 and 3 emissions.

To comply with SECR, companies are required to include energy consumption data and GHG emissions figures from the previous year; this makes it easy to monitor progress and compare essential data. Organisations must detail the energy efficiency measures they have implemented during the reporting period, including if no action has been taken. This adds an additional layer of motivation to drive and enact change annually.

How does SECR help businesses in advancing sustainability agendas?

Since SECR can act as a tool to measure progress towards reducing carbon emissions, data collected during reporting can be integrated into corporate sustainability strategies. SECR reporting provides stakeholders with clear and comparable information regarding an organisation’s environmental impacts. This transparency not only aligns companies with global climate targets and promotes environmental stewardship, but it also underscores the commitment of businesses to sustainable practices. Organisations gain valuable insight from SECR reporting which can be utilised for strategic planning and risk management. The data collected can highlight areas of large energy consumption and can support with the identification of energy-saving opportunities and other sustainable initiatives. This assists businesses in progressing towards Net Zero, as well as improves their chances of reducing costs.

How does SECR enhance stakeholder understanding of businesses sustainability strategy?

SECR is a useful mechanism for conveying essential data to stakeholders, using a structured and easily digestible framework. By reporting on your organisation’s energy consumption and emissions, stakeholders can grasp the company’s environmental impact, and sustainability efforts being made to mitigate it. Stakeholders can then evaluate whether a business is on track to hit its Net Zero targets and have better insight when deciding the next steps.

SECR reporting allows companies to showcase their sustainability strategies and progression to stakeholders annually. The increased transparency SECR reporting brings could have the potential to influence investment decisions, especially where sustainability commitments are important drivers.

How does SECR reporting transparency provide a competitive advantage to businesses?

SECR transparency allows businesses to benchmark their carbon emissions against competitors, helping them identify strengths and areas for improvement in their sustainability efforts. Having the ability to benchmark against industry standards is important, as it enables companies to refine their strategies, adopt best practices, and gain a competitive edge. By publicly committing to sustainability through SECR reporting, companies can boost their corporate image and build stronger stakeholder trust. In an environment where greenwashing is a concern, transparent reporting helps establish credibility and demonstrates a genuine commitment to reducing carbon footprints.

Is SECR an essential driver for decarbonisation?

The SECR framework plays a crucial role in helping companies reduce their carbon footprint. By mandating the disclosure of energy use and greenhouse gas emissions, SECR enhances transparency and accountability, driving businesses to take meaningful action toward Net Zero.

Beyond regulatory compliance, SECR reporting supports strategic planning, risk management, and operational improvements while boosting a company’s reputation. It offers a huge opportunity for businesses to see beyond what is required and reinforce their dedication to decarbonisation.

How can Amber help?

Our team can provide SECR guidance and support your business on its journey to compliance. Please get in touch to find out how we can support you.

Want to read more from us? Visit our Insights for insightful blogs, reports and videos.