Business has to change its accounting for the climate crisis and Mark Carney needs to go further than he’s suggesting is necessary

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I'm working on sustainable cost accounting in 2020. Or sustainable cost reporting as it might be renamed, as I realise that means it becomes SCORE. And asking what your SCORE is can be quite useful in an accounting context.

It will not be all I am doing, by a long way. But it will be important because the climate crisis is, and so far the response from business is inadequate. Mark Carney says so this morning, and he would be right even if his Task Force on Climate-related Financial Disclosures recommendations were adopted, because my reading suggests that they are based on some pretty poor greenhouse gas disclosure standards.

There is a mass to do then. But Carney is right on some things: as the FT notes about his interview:

Companies could see many of their assets become worthless if they do not act swiftly enough on climate change, the outgoing head of the Bank of England has said.

And:

The financial sector “is not moving fast enough” to curb investment in fossil fuels, central bank governor Mark Carney said on BBC Radio 4’s Today programme.

Adding:

“What we can’t have is a financial sector that ignores the problem and all of a sudden it has to deal with it,” he said. The value of some of the companies’ assets could plummet if they did not act more quickly.

I believe sustainable cost accounting is a tool to tackle that issue.