Fleet News

Fleets warned not to hide CO2 by switching to grey

New rules that came into force last week will eventually require thousands of companies to highlight their greenhouse gas emissions in their annual reports, including those from vehicles they ‘own or control’.

The regulation, made under the Companies Act 2006, initially affects the 1,000 companies listed on the London Stock Exchange but could be extended to all large companies from 2016.

However, it excludes business travel by means ‘not owned or controlled by the organisation’, including staff driving their own vehicles for business which experts believe is a loophole which some companies might seek to exploit.

The Government says it excluded such journeys due to logistical difficulties and the administration burden.

Nevertheless, it is asking companies to voluntarily report emission levels linked to such vehicle use.

Martin Evans, managing director of fleet software provider Jaama, said fleet operators tempted to ‘hide’ higher emission cars by allowing staff to use their own vehicles would go against the spirit of the rules which seek greater transparency on carbon footprints.

“A company can reduce its declared carbon footprint by allowing people to use their own vehicles for business, but this doesn’t deliver a real cut in the carbon footprint,” he said.

Obtain grey fleet CO2 emissions

Evans believes Jaama’s Electronic Driver Services (EDS) software simplifies the process by enabling grey fleet drivers to log details of the vehicles they use for business.

He told Fleet News: “Companies recognise the need to manage grey fleet, but it is difficult to obtain additional staff to cope with the extra administration to take on this responsibility. This is where products like EDS can help.

“Our software includes a V5 look-up process which enables our customers to obtain their grey fleet CO2 emissions and calculate this for their own purposes and declare it if required in the future.”

Brian Kirby, systems director at JCT600 Contracts, also pointed to the developments in fleet software which is cutting the administrative burden in recording grey fleet mileage.

“Customers can schedule reports to be delivered at a frequency of their choosing,” he said.

“We are highlighting carbon reporting to our customers and believe a lot of organisations will request this service, particularly larger businesses where corporate social responsibility is a board level issue.

“However, we are making it an ‘opt in’ service as we don’t want customers to suffer from information overload.”

Similarly, Fleet Hire, via its Jaama-developed online customer dashboard, is able to provide carbon footprint data which allows clients to calculate individual vehicle and fleet-wide CO2 levels.

Fleet Hire sales director Nick Poole said: “Our larger customers are interested in reporting their carbon footprint because they have stakeholders to satisfy in terms of meeting corporate social responsibility requirements.

“Smaller businesses have an interest in CO2 levels and their carbon footprint because by reducing vehicle emissions they are saving money in fuel and tax costs.

“We try to produce software that will enable our customers to comply with both current and future legislation.

“All the basics of fleet software are now there, and as companies need to comply with increasingly stringent rules and regulations to measure data, software can help reduce the need for additional resources.”

Regulation enforcement is being carried out by the Conduct Committee of the Financial Reporting Council which can apply to the courts for a declaration that a company’s annual report does not comply with the applicable requirements.

Under the provisions of the Companies Act, directors may face a fine if they knew that the directors’ report
was non-compliant with the applicable requirements, or were reckless or failed to take reasonable steps to
ensure compliance.

Click here for grey fleet best practice and procurement insight

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