AASB S1 #
Australia's voluntary general sustainability disclosure standard, the broader companion to AASB S2 covering sustainability topics beyond climate. Currently voluntary in Australia.
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Carbon & Climate Glossary
Plain-English definitions of the Australian carbon accounting, AASB S2 climate reporting, and GHG Protocol terms your business will encounter in tenders, supplier questionnaires, and compliance work.
A
AASB S2 #
Australia's mandatory climate-related financial disclosure standard, issued by the Australian Accounting Standards Board in September 2024. It is the local Australian version of IFRS S2 and sits inside the annual financial report for in-scope entities.
AASB S2 Climate Reporting service →ACCU (Australian Carbon Credit Unit) #
An Australian carbon credit representing one tonne of CO2-e abatement or sequestration, issued by the Clean Energy Regulator under the Carbon Farming Initiative. Used in compliance schemes such as the Safeguard Mechanism.
Activity Data #
The measured input (litres of diesel, kWh of electricity, kilograms of refrigerant, tonnes of waste) that is multiplied by an emission factor to calculate greenhouse gas emissions. The quality of an inventory is largely determined by the quality of the activity data.
ASIC #
Australian Securities and Investments Commission. Australia's corporate regulator that administers AASB S2 climate-related disclosure obligations.
ASRS (Australian Sustainability Reporting Standards) #
Australian Sustainability Reporting Standards comprise voluntary AASB S1 for broader sustainability-related financial information and AASB S2 Climate-related Disclosures for entities subject to Australian mandatory climate reporting.
AUASB #
Auditing and Assurance Standards Board. Sets the assurance standards Australian auditors apply to AASB S2 climate-related disclosures.
B
Baseline Year #
The reference year against which future emissions are measured. Selection of an appropriate baseline year is a strategic decision for any reduction or net-zero target.
C
Carbon Intensity #
Emissions per unit of output, revenue, or production. Common in tender benchmarking (e.g. tCO2-e per $M revenue, kgCO2-e per tonne of product). Lets buyers compare emissions performance across suppliers of different sizes.
Carbon Offset #
A tradeable certificate representing the reduction or removal of one tonne of CO2-e. In Australia, the primary credit is the Australian Carbon Credit Unit (ACCU).
Carbon Schedule (Tender) #
The carbon and climate annexure to a tender response. Typically requires a quantified Scope 1+2 footprint, sometimes Scope 3 categories, methodology disclosure, base year, and reduction targets. Increasingly mandatory for Commonwealth, state, and large corporate procurement.
Tender-Ready Carbon Snapshot service →CBAM (Carbon Border Adjustment Mechanism) #
An EU policy that prices the embedded carbon in imported goods such as steel, aluminium, cement, and fertilisers. Relevant for Australian exporters into European supply chains.
Clean Energy Regulator (CER) #
The Australian Government agency that administers the National Greenhouse and Energy Reporting (NGER) scheme and the Carbon Credits (Carbon Farming Initiative) Act.
Climate Active #
An Australian Government-backed certification program for carbon neutral organisations, products, services, buildings, events, and precincts.
Climate Scenario Analysis #
Assessment of business outcomes under one or more future climate pathways. AASB S2 requires an approach commensurate with the entity's circumstances and does not prescribe a fixed pair of scenarios.
CO2-e (Tonnes Carbon Dioxide Equivalent) #
The unit used to express emissions of all greenhouse gases in a common measure, weighting each gas by its global warming potential relative to CO2. Often written as tCO2e or tCO2-e.
CRFD (Climate-related Financial Disclosure) #
The Australian regulatory term for the mandatory climate reporting introduced by AASB S2. Used in Treasury and ASIC communications. Functionally equivalent to climate disclosure under IFRS S2.
D
DCCEEW #
Department of Climate Change, Energy, the Environment and Water. The Australian Government department that publishes the National Greenhouse Accounts Factors annually.
Diesel Generator Emissions #
A major Scope 1 source for remote and off-grid Australian operations, including mine sites, agribusiness, water utilities and telecoms. Often the largest emission source for businesses outside the NEM. Tracked via litres of diesel × NGA Table 9 factor (2.72 kgCO2-e/L combined Scope 1).
E
Emission Factor #
A multiplier that converts activity data (litres of diesel, kWh of electricity) into greenhouse gas emissions in tCO2-e. For Australian businesses, factors are sourced from the NGA Factors workbook published by DCCEEW.
F
FLAG (Forest, Land and Agriculture) #
A guidance framework developed by the Science Based Targets initiative (SBTi) for measuring and reporting emissions from agricultural, land-use, and forestry activities. Covers livestock methane, fertiliser nitrous oxide, land-use change, and biomass carbon.
FLAG Emission Accounting service →G
GHG Protocol #
The Greenhouse Gas Protocol Corporate Standard. The global standard for corporate emissions accounting, developed by the World Resources Institute (WRI) and World Business Council for Sustainable Development (WBCSD). The methodological foundation underlying AASB S2 and most national reporting frameworks.
GHG Verification #
Independent confirmation by an accredited third party that a greenhouse gas inventory has been prepared in line with a recognised standard such as ISO 14064-3.
Greenwashing #
Misleading or unsubstantiated environmental claims. Actively enforced in Australia by the ACCC and ASIC: penalties have been issued for vague 'carbon neutral' or 'net zero' claims without disclosed methodology and verified data. Risk increases sharply once AASB S2 disclosures begin, because mandatory reporting establishes a comparable benchmark for marketing claims.
Group 1 Reporter (AASB S2) #
The largest entities under AASB S2. Reporting required from periods commencing on or after 1 January 2025. Threshold: revenue over $500M, assets over $1B, or 500+ employees, or NGER Section 13 publishers.
Group 2 Reporter (AASB S2) #
Subject to Chapter 2M eligibility, Group 2 applies to financial years commencing on or after 1 July 2026. Pathways include meeting two of three thresholds: revenue $200M+, assets $500M+, or 250+ employees; certain NGER reporting corporations not in Group 1; and specified asset owners.
AASB S2 Readiness Check →Group 3 Reporter (AASB S2) #
Smaller entities under AASB S2. Reporting required from periods commencing on or after 1 July 2027. Threshold: revenue over $50M, assets over $25M, or 100+ employees, with material climate-related risks or opportunities.
I
IFRS S2 #
The International Sustainability Standards Board's climate-related disclosures standard. AASB S2 is its Australian implementation.
IPCC #
Intergovernmental Panel on Climate Change. The United Nations body that assesses climate science and provides the warming potential values used in greenhouse gas accounting.
ISO 14064-1 #
International standard for designing and reporting an organisational greenhouse gas inventory. Covers principles, boundary setting, quantification, and documentation.
ISO 14064-2 #
International standard for greenhouse gas reduction or removal project-level accounting. Used for offset projects and emission reduction initiatives.
ISO 14064-3 #
International standard for the validation and verification of GHG statements. The methodology applied by accredited verifiers when reviewing inventories built to ISO 14064-1 or -2.
ISO 14064 Verification Support service →ISSB #
International Sustainability Standards Board. The body under the IFRS Foundation that issued IFRS S1 (general sustainability) and IFRS S2 (climate) disclosure standards.
L
Limited Assurance #
A lower level of independent assurance where the auditor provides a negative form opinion: nothing has come to attention to suggest the disclosure is materially misstated. The default assurance level for the first years of AASB S2 reporting.
Location-based vs Market-based (Scope 2) #
Two methods for calculating purchased-electricity emissions under the GHG Protocol. Location-based uses the grid average emission factor (e.g. NGA Table 1, NEM/SWIS/NWIS/DKIS). Market-based uses contract-specific factors (PPAs, GreenPower, LGCs). AASB S2 and many tenders require dual disclosure of both.
M
Materiality #
The threshold at which information is significant enough to influence decisions of users. In AASB S2, material climate-related risks, opportunities, and Scope 3 emissions categories must be disclosed.
N
NEM (National Electricity Market) #
The interconnected electricity grid serving Queensland, NSW/ACT, Victoria, Tasmania, and South Australia. WA (SWIS, NWIS) and NT (DKIS) are separate grids with their own emission factors in the NGA workbook. Grid choice matters for accurate Scope 2 reporting in regional Australia.
NGA Emission Factors →Net Zero #
Achieving balance between greenhouse gas emissions produced and emissions removed from the atmosphere. Requires deep reduction first, with residual emissions offset by removals.
NGA Factors (National Greenhouse Accounts Factors) #
The official Australian Government emission factors workbook, published annually by DCCEEW. The authoritative source for emission factors used in Australian carbon accounting.
NGER #
National Greenhouse and Energy Reporting scheme. Mandatory reporting framework under the National Greenhouse and Energy Reporting Act 2007 for facilities and corporations meeting size thresholds. Administered by the Clean Energy Regulator.
AASB S2 Group Checker (covers NGER pathway) →O
Operational Boundary #
The split of emissions into Scope 1, 2, and 3 once the organisational boundary is set.
Organisational Boundary #
The set of entities, sites, and operations included in an emissions inventory. Defined using either an equity share approach or a control approach (financial or operational).
P
Physical Climate Risk #
Risk to business operations from direct climate impacts including floods, cyclones, bushfires, heatwaves, drought, and sea-level rise.
Climate Risk Analysis service →R
Reasonable and Supportable Information #
The AASB S2 standard's threshold for Scope 3 disclosure. Reporters must disclose Scope 3 emissions to the extent supported by 'reasonable and supportable information' that is available without undue cost or effort. The phrasing creates judgement room but also a documentation burden: what was considered, what was excluded, and why.
Reasonable Assurance #
A higher level of independent assurance, equivalent to a financial audit opinion. Phased in for AASB S2 reporters after limited assurance.
S
Safeguard Mechanism #
Australian policy under the NGER Act that sets emission baselines for the country's largest emitting facilities. Facilities exceeding the baseline must surrender ACCUs or Safeguard Mechanism Credits (SMCs) to compensate.
SBTi (Science Based Targets initiative) #
An international body that validates corporate emission reduction targets against the level required to limit warming to 1.5°C. Provides sector-specific guidance including FLAG for agriculture and land use.
Scope 1 Emissions #
Direct greenhouse gas emissions from sources owned or controlled by the reporting entity. Includes fuel combustion in vehicles and plant, on-site generators, refrigerant leaks, and process emissions.
Carbon Footprint Analysis service →Scope 2 Emissions #
Indirect emissions from the generation of purchased electricity, heat, or steam consumed by the reporting entity. Reported using either the location-based method (grid factor) or market-based method (specific energy contracts).
Scope 3 Emissions #
All other indirect emissions in the value chain, both upstream (purchased goods, freight, business travel) and downstream (use and disposal of sold products). Categorised into 15 categories by the GHG Protocol.
Supplier Data Response service →Scope 3 Screening #
An initial high-level analysis to identify which of the 15 Scope 3 categories are likely to be material for a business, before committing to detailed measurement.
Supplier Questionnaire (Carbon) #
A structured request from a large customer asking suppliers to disclose their emissions, methodology, and reduction plans. Common platforms include EcoVadis, CDP Supply Chain, and bespoke spreadsheets from Coles, Woolworths, and major construction primes. Increasingly tied to contract renewal and tender eligibility.
Supplier Data Response service →Sustainable Procurement (ISO 20400) #
The international standard for embedding sustainability into purchasing decisions. Referenced by large buyers (Coles, Woolworths, Bunnings, government) when issuing supplier questionnaires. Drives the Scope 3 supplier-data requirements that flow down to regional SME suppliers.
T
Transition Climate Risk #
Risk to business from the shift to a low-carbon economy, including policy changes, carbon pricing, technology shifts, and changing customer or investor preferences.
V
Value Chain #
All upstream and downstream activities related to a business's products and services, including suppliers, distribution, use, and end-of-life. The scope of Scope 3 emissions disclosure.
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