Climate reporting standards put IT emissions under close scrutiny

Mandatory climate reporting is placing new pressure on companies to accurately disclose climate-related risks, with particular scrutiny on how information technology assets contribute to overall carbon emissions. For many organisations, IT remains one of the most challenging areas to quantify and manage in sustainability reporting frameworks.

Increasing scrutiny

Recent updates to standards set by the Australian Accounting Standards Board (AASB S2) and Australian Sustainability Reporting Standards (ASRS) require companies to include detailed Scope 3 emissions data in their disclosures. Industry analysts suggest that many first-time reporters are currently working with reasonable estimates, a practice likely to face greater interrogation as climate reporting matures.

This broader climate of scrutiny has already led several companies to make public revisions to their sustainability claims. Thirteen energy retailers have been questioned over ambiguous carbon neutral statements, and Apple has scaled down its Watch-related environmental marketing. Other firms, such as EnergyAustralia, have publicly acknowledged previous 'greenwashing' errors.

IT reporting challenge

For organisations, technology procurement, use and retirement introduces significant complexity. Supply chains for devices such as laptops, servers and mobile phones often cross multiple regions and partners. Organisations may struggle to track assets through their lifecycle, leading to risks of emissions being omitted, double-counted or inconsistently recorded.

Chief Financial Officers and procurement directors face the growing expectation to account for every device under their oversight, ensuring that assets are neither disposed of irresponsibly nor inaccurately represented in emissions reporting.

"Boards are now asking CFOs to show evidence," said Stella Heesom, Founder, TechForGood.

Heesom's consultancy works with private and public sector clients to align IT supply chains with ASRS 2, National Greenhouse and Energy Reporting Scheme (NGERS) and social procurement targets. She reports that tracking the journey of IT assets-demonstrating secure recovery, repurposing or recycling, alongside audit-ready data-enables organisations to produce reliable Scope 3 emissions reports and meet board expectations.

Improved visibility

Heesom said many businesses have the intention to comply with sustainability demands but lack the visibility required to follow assets throughout their lifecycle. Accurate compliance, she argues, is contingent on knowing the precise location of each device, who manages it, and how those actions are recorded for audit purposes.

"Compliance doesn't have to be complicated or costly. Most businesses already have the right intent; what they lack is visibility - knowing where every asset is, who's handling it and how that translates into verified reporting data," said Heesom.

Integrated accountability

Engineering firm Synertec has integrated sustainability accountability directly into its operational processes. Synertec emphasises the importance of embedding accountability from the outset rather than treating it as an isolated reporting exercise.

"When you design the process right from the start, accountability becomes part of everyday operations - not an extra report to tick off," said Sam Carroll, Head of Communication, Synertec

Case in practice

A state infrastructure project illustrates the potential benefits. Working to meet Victoria's 3 per cent social procurement target, a lead contractor engaged TechForGood to help consolidate a fragmented supplier base for a AUD $560 million development. By reducing the number of suppliers and centralising IT asset management, the contractor avoided more than AUD $1 million in compliance and onboarding costs. The model maintained the sustainability reporting requirements and created opportunities for priority jobseekers.

"This is where compliance meets efficiency. When sustainability reporting becomes a contractual requirement, not an aspiration, clients need partners who can deliver assurance and ROI in the same line item," said Heesom.

Heesom urges companies to avoid the unintended expense of so-called 'purpose premiums' often associated with sustainability-driven procurement decisions. She believes focusing procurement with verified providers not only supports compliance but maintains fiscal discipline.

"Fragmented spending to reduce carbon impact creates unnecessary risk and overhead. A single verified partner gives companies evidence, assurance and cost control in the same motion. We want to see CFOs and CPOs stop paying a 'purpose premium,' because companies can only focus on driving real change when the bottom line is healthy," said Heesom.