Greenwashing still exists and rules on the Paris Agreement adopted at COP21 in 2015 are still unclear.
These were views aired at the recent Saica Climate Change Conference.
Gillian Niven, sustainability legal specialist at Niven Attorney, said, “South Africa does not have a fully operational carbon market at the moment, we have had some of the starting blocks being put in place like the carbon tax.”
“However, looking at the projects that corporate SA and businesses are investing in to achieve the net-zero targets, we have seen a proliferation of renewable energy projects and with that an interest in environmental attributes, which feeds into a more global conversation around the carbon market,” she added.
Saica hosted its inaugural Climate Change Conference on 25 October 2023, under the theme Difference Making is about Creating a Sustainable Future.
Gillian was participating in one of the conference panel discussions, with Nola Richards, group executive head of ESG and sustainable business at Vodacom; Anelisa Keke, chief sustainability officer at Redefine Properties and Scott Williams, ESG coordinating director at Marsh Middle East and Africa.
Nola noted, “Some of the operations are very constrained and the regulatory environment does not allow for corporate to do much in terms of the carbon economy. It is very complex, but we are up for the challenge.”
Scott added, “The biggest takeaway from COP27 was the establishment of the Loss and Damage Fund from a climate change perspective. I think they have recently had engagements regarding the working group countries, but it is still not that promising. I am hoping we get rapid improvement and tangible outcomes.”
Disclosures and reporting
The second panel discussion covered the evolving expectations in climate disclosures and its impact on corporate reporting. Panellists included Jayne Mammatt, partner at Deloitte; Kavita Pema, group head: sustainability and ESG at AECI; Cynthia Mbili, technical partner at Ernst & Young; Harold Pauwels, director standards at Global Reporting Initiative (GRI) and Ravi Abeyawardana, director strategic affairs and capacity building at the IFRS Foundation.
Cynthia said, “Most of our companies are already reporting on sustainability, although voluntarily and using different frameworks. We have seen regulators putting out requirements saying disclose or provide certain information. I would advocate for a short to long-term solution in terms of trying to mandate the standards.”.
The third panel discussion made it clear that accountants and auditors also have a role to play in tackling climate change and reporting.
The panellists were Ian Kramer, senior vice president: group finance at AngloGold Ashanti; Fikile Zwane, partner at SNG Grant Thornton; Milan van Wyk, senior lecturer at the University of Johannesburg and Ronell Govender, global ESG and sustainability at Naspers.
Ian said auditors needed to understand the business of their clients on sustainability reporting, and most entities underestimate what that means.
Fikile criticised the greenwashing that exists, and added that firms must protect users of financial statements and be honest when a client is not upfront.
“Usually, before entities start reporting they put in place processes, and they have benchmarks. So, when a company states it has saved so much emissions, it must be compared to tangible data. As ESG assurance providers, we usually go into companies and verify the benchmarks,” he said.
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