WITH THE NEED for accurate carbon data to enable investors to assess the carbon performance of companies in their portfolios, VicSuper, in con junction with the Environment Protection Author ity Victoria, has released the findings of its VicSuper Carbon Count 2008 Report.

The two bodies again commissioned environ mental research firm, Trucost, to analyse the carbon disclosure and performance of companies in the S&P ASX200. Trucost also examined potential profit risk under the planned Carbon Pollution Reduction Scheme (CPRS), which is expected to apply a price to greenhouse gas emissions from 2020.

According to the report, a further 10 per cent of corporate greenhouse gas emissions have been dis closed since the 2007 VicSuper Carbon Count. Car bon-intensive industries dominate disclosures, with 85 per cent of greenhouse gas emissions analysed in the report based on corporate disclosure.

Significantly, the quality of corporate disclo sure has improved hugely, with 34 per cent of emis sions now reported in line with the Greenhouse Gas Protocol (an international corporate accounting framework developed by the World Business Coun cil for Sustainable Development and the World Resources Institute), up from just 1 per cent in the 2007 analysis.

The number of companies publicly disclosing adequate emissions data has also increased from 25 per cent to 30 per cent year on year. Sectors including textiles, apparel and luxury goods, airlines, electric utilities and media disclosed emissions for the first time.

Companies in the ASX200 emit 243 million tonnes of greenhouse gas emissions globally, including emis sions from direct suppliers such as electric utilities. This equates to 42 per cent of greenhouse gas emissions in Australia. If they had to pay the widely expected $20 for every tonne of greenhouse gas emitted globally, carbon costs would total $4.8 billion.

For every million Australian dollars invested, ASX200 companies emit 389 million tonnes of greenhouse gas. Predictably, the five sectors most exposed to carbon costs are independent power pro ducers and energy traders, multi-utilities, con struction materials, metals and mining, and chemicals. For 29 sectors, however, carbon costs equate to less than 1 per cent of revenue.

Direct emissions from company operations total 137 million tonnes of greenhouse gases, with five companies – BHP Billiton, Rio Tinto, Bluescope Steel, Qantas Airways, and AGL Energy – directly emitting more than half this amount.

“The good news is that more Australian compa nies are measuring and publicly reporting their car bon emissions than last year,” said VicSuper chief executive Bob Welsh. “The bad news is that the environmental damage costs of these emissions are significant – to the order of $4.8 billion at a carbon price of $20 per tonne. The challenge now for cor porate Australia is to eliminate these costs through innovative design and process improvements.”

Trucost chief executive Simon Thomas also identified the data’s importance: “The report shows that many more companies are now accounting for their contribution to climate change. Quality car bon data is vital for investors in Australian equities to identify risks in portfolio returns, as well as opportunities to develop low risk portfolios that favour carbon efficient companies.”