Carbon Reporting in Australia: A Simple Guide for Businesses
Carbon reporting is becoming increasingly important for Australian businesses. Simply put, carbon reporting is measuring and disclosing the greenhouse gases your business produces directly and indirectly. Understanding your carbon impact isn’t just good for the planet; it’s quickly becoming a necessity for doing business.
Carbon emissions from your business are grouped into three simple categories:
Scope 1 emissions are direct emissions produced by your business activities, like fuel burned by company vehicles or machinery.
Scope 2 emissions come from indirect sources, mainly the electricity your business uses.
Scope 3 emissions are all other indirect emissions from your broader supply chain. This includes emissions from the goods and services you buy, from franchisees and financed emissions (for banks and investors)
Starting from January 2025, large Australian businesses must report their Scope 3 emissions annually under new rules set by the Corporations Act 2001. Initially, these rules target big companies, including property developers, banks, major retailers, and restaurant chains, with smaller entities picked up in each subsequent year.
However, even if your business isn’t directly obligated, you’ll likely feel the effects if you supply these larger companies. They'll soon expect reliable carbon emissions data from you as part of their reporting obligations. Being proactive now gives your business a clear advantage in readiness and competitiveness.
Read more about these changes from Grant Thornton's detailed report here.
In Australia, buildings contribute around 20% of our total carbon emissions. Much of this comes from what's called 'upfront carbon', meaning emissions from the materials used in construction and their transportation.
To tackle this, several new Australian regulations are being added to the existing voluntary standards and rating programs:
NABERS Embodied Carbon Rating
Non-residential buildings can now report embodied carbon emissions for the materials that make up their building
NSW Planning Policies (SEPP)
Residential and commercial construction projects must demonstrate their sustainability credentials, including embodied carbon, using BASIX or a NABERS Embodied Carbon Rating
National Construction Code (NCC 2025)
The Code is introducing voluntary embodied carbon reporting in 2025, moving towards mandatory standards by 2027.
For further reading, explore NABERS and NSW SEPP.
Globally, carbon reporting rules are tightening:
Europe’s Carbon Border Adjustment Mechanism (CBAM) will soon apply tariffs on high-carbon imports, including steel and cement. Australian exporters must provide verified carbon data to remain competitive in Europe. Learn more about CBAM here.
The United States, United Kingdom, and several Asian countries increasingly require businesses to disclose carbon emissions clearly, affecting Australian businesses operating internationally.
Voluntary global reporting standards, such as the Global Reporting Initiative (GRI) and Carbon Disclosure Project (CDP), Science Based Targets Initiative (SBTi) encourage or require comprehensive carbon reporting, setting expectations even for Australian businesses not directly regulated.
These global developments mean Australian companies involved in international trade or supply chains must now have robust carbon reporting strategies in place.
To get ready, follow these straightforward steps:
Start measuring your carbon emissions now, tools like Rebuilt’s Product Carbon Footprint platform make this simple and affordable.
Collaborate closely with suppliers to gather accurate carbon data.
Use verified carbon data to build trust with customers, investors, and regulators.
Early action positions your business as responsible, compliant, and forward-thinking.
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Carbon reporting isn’t a distant future concern, it’s essential now. Businesses that proactively embrace these changes will find themselves ahead of the curve, well-prepared, and trusted by customers and partners alike. By understanding and managing your carbon footprint today, you're actively shaping a sustainable, successful tomorrow.