Australian Sustainability Reporting Standards (AASB S2) and the ESG Digital Transformation with Trellis Technologies

Why listen to me?

Prior to Co-founding and launching Trellis Technologies in 2018, a software and data platform that sets out to solve the ESG data challenge at scale, I was a technical auditor, registered with the Clean Energy Regulator (CER) for NGER Act an National Carbon Offset Standard (NCOS) (predecessor to Climate Active) assurance.

Years of audit experience across organisations from open cut coal mines to airlines and everything in between equipped me with an intimate understanding of the data challenges that organisations face when compiling audit ready reporting. Let alone managing the problem.

Today, armed with a team of software, data and AI genius(es), we’ve helped more than 100 clients with ESG data transformation, validation, and reporting across 30,000+ facilities in Australia and New Zealand. It’s a humbling feeling considering the scale we’ve achieved and what we’ve learnt about the challenges and the opportunities in the ESG digital transformation journey.

With what is now literally days before the ASSB S2 Standards https://standards.aasb.gov.au/aasb-s2-sep-2024 come into effect on January 1st, we’re here to share our learnings and give your organisation and team, the automation, scalability and data governance it needs.

We’ve learnt that getting our customers up and across the ESG digital transformation curve (see below) delivers high levels of automation, scalability, interaction and confidence. Not to mention the granular day-to-day insights that help you course correct and adjust.

Scattered throughout the ASRS S2 and S1 are a range of requirements, encapsulating governance, strategy, risk management, metrics and targets.

Let’s consider some of the immediate and tangible gains your organisation can realise from an effective digital transformation to align and comply with ASRS S2 and S1.

1. Greenhouse gas emissions - Scope 1, 2 and 3

Implementing an automated system of data collection, validation and reporting from preferably financial grade activity data such as billing and other sources related to Scope 1, 2 and 3 emissions is paramount. Scope 1, 2 and eventually 3, underpin much of ASRS, as well as any other related standard and legislation. Automation being the key, as manual time spent on collation and transcription is error prone and resource inefficient. This system must be supplier- and data-structure-type agnostic.

Scope 1, 2 and 3 emissions numbers are the aggregation of all activities happening across your organisation. This is where tangible gains can be made.

2. Climate-related risks and opportunities – amount of capital expenditure ($), financing or investment deployed towards climate related risks and opportunities

To be able to accurately report efforts to reduce impact and spend, and show how those reductions ultimately improve return on investment (ROI) will be critical. You want to tell your story at multiple levels and know that capital deployment is ultimately working as expected in relation to reducing emissions, unit consumption, waste and ultimately spend.

Using utility billing to link consumption (units), cost ($), energy (gigajoules, GJ) and GHG (tonne CO2e) to track changes across all metrics based on targets is key to understanding the op-ex cost impacts, preferably downwards across ALL Scopes and the activities that underpin them.

3. Build internal understanding and improve timeliness and insights into impact and spend

Intercepting continuous data, validating this data for completeness and representation, as well as flagging anomalies and exceptions makes good business sense. It avoids the reporting period scramble and enables a continuous realisation of anomaly detection, exception handling and other insights throughout the year. It makes you agile in an ever-changing landscape.

4. Internalising carbon price - $ per metric tonne CO2e

Putting a price on carbon is an impactful way to internalise the true cost, or in economic terms, to realise the externality – in this case, your organisation’s emissions.

5. Good Governance

Audit readiness – Two key focus areas for audit are firstly ensuring accurate representation of your emissions generating activities and second, checking completeness of the data related to those activities. Trellis can track your meter connections and disconnections while providing extensive data-gap detection and reporting. Importantly, Trellis links activity and source data to calculations, which can help with audit sampling and provides transparency.

Removing key person risk – A digital approach ensures that staff changes create minimal impact to the organisation and that business continuity can be maintained through consistent reporting constructs.

Security – Adequate protection for sensitive data is difficult to achieve in multiple spreadsheets, files and locations. Centralising your data and securing access to it play a critical role in protecting your organisation against a data breach of any sort.

We'd like to be a part of your sustainability journey and show you how to unlock ROI along the way. I hope you found this article helpful. If you’d like to understand more, book a time with Trellis Technologies.

We'd like to be a part of your sustainability journey and show you how to unlock ROI along the way. I hope you found this article helpful. If you’d like to understand more, book a time with Trellis Technologies.

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