Mandatory & Voluntary Carbon Reporting Standards

Carbon Reporting & Certification Standards Guide (2025): From GHG Protocol to SAF & Green Hydrogen

Every industry is feeling the pressure to take measurable climate action. Governments are introducing stricter emissions regulations, investors are assessing environmental performance, and businesses are being held accountable for their carbon footprints.

For companies looking to measure and reduce emissions effectively, carbon reporting standards provide the structure and credibility needed to ensure accurate, transparent, and actionable data.

These frameworks help organisations track their environmental impact, comply with evolving regulations, and align with global sustainability goals.

But with multiple reporting standards available, how do businesses determine which one fits their needs?

We have broken down key mandatory and voluntary carbon reporting standards, including GHG Protocol, ISO 14064, CDP, TCFD, and PCAF, and other critical frameworks, so you can understand what applies to your organisation and how to implement these frameworks effectively. Beyond cross-sector reporting, industries like biofuels, aviation, and green hydrogen must also follow certification schemes such as ISCC, RSB, RED II/III, and CORSIA, which we’ve included here to give you a full view of reporting and compliance obligations.

What Are Carbon Reporting Standards? 

Carbon reporting standards are structured guidelines that organisations use to measure, quantify, and disclose greenhouse gas (GHG) emissions. These standards ensure that emissions data is collected consistently, making it easier to compare results across industries, track reduction efforts, and meet legal obligations. 

Why Carbon Reporting Standards Matter 

• Ensure Data Accuracy – Standardised methodologies prevent inconsistencies and errors in emissions reporting. 
  
  

• Improve Regulatory Compliance – Many governments now require businesses to track and disclose emissions data in accordance to a reporting standard. 
  
  

• Enhance Stakeholder Trust – Investors, customers, and regulators rely on verified carbon data to assess sustainability commitments. 
  
  

• Support Emissions Reduction Strategies – A structured reporting approach helps businesses identify inefficiencies and opportunities for lower-carbon operations. 
   

Mandatory vs. Voluntary Carbon Reporting Standards 

Some reporting frameworks are mandatory depending on industry and location, while others are voluntary but widely adopted for credibility and best practices. 

Mandatory Standards (Legally Required in Specific Jurisdictions)

• European Sustainability Reporting Standards (ESRS) (EU) – Required under the Corporate Sustainability Reporting Directive (CSRD) for large companies operating in the EU. 
  
  

• Task Force on Climate-related Financial Disclosures (TCFD) (UK, EU, Japan, Canada, New Zealand, Singapore, US SEC - proposed rule) – Required in several financial markets and stock exchanges. 
  
  

• Greenhouse Gas (GHG) Protocol (Often Required) – Used as the basis for many regulatory carbon reporting requirements globally (e.g., EU CSRD, US SEC proposal, and national-level climate laws). 
  
  

• PCAF (Partnership for Carbon Accounting Financials) (Financial Institutions, Some Jurisdictions) – Required by some national financial regulators and integrated into mandatory disclosures in the EU. 

Voluntary Standards (Industry Best Practice, But Not Legally Required) 

• CDP (Carbon Disclosure Project) – Used voluntarily by thousands of businesses for investor and corporate transparency. 
  
  

• ISO 14064 – An international standard for carbon accounting and verification. Often used for internal carbon management and third-party assurance. 
  
  

• Science-Based Targets initiative (SBTi) – A voluntary framework to align corporate carbon reduction goals with Paris Agreement targets. 
  
  

• Verified Carbon Standard (VCS) (For Carbon Offsets) – Used by organisations purchasing or developing carbon credits but not required for emissions reporting. 
  
  

• Global Reporting Initiative (GRI) – One of the most widely used sustainability reporting frameworks but not a compliance requirement. 
  
  

• International Sustainability Standards Board (ISSB) (Emerging Global Baseline) – Designed to standardise sustainability reporting globally but still voluntary for most companies. 
    

Key Carbon Reporting Standards Explained
 

1. Greenhouse Gas (GHG) Protocol 
   
   

   Overview	The Greenhouse Gas (GHG) Protocol is one of the most widely used standards for measuring and managing greenhouse gas emissions.  Developed by the World Resources Institute (WRI) and the World Business Council for Sustainable Development (WBCSD), it provides a comprehensive methodology for calculating and reporting emissions and is used by businesses, governments, and environmental organisations worldwide.
   Type	Voluntary framework, widely adopted and often forms the basis for mandatory regulations.
   Applies To	All industries.
   Where It’s Required	While the GHG Protocol itself is voluntary, many national and international regulations are built upon its methodologies. For instance:  1. European Union: The Corporate Sustainability Reporting Directive (CSRD) mandates large companies to report sustainability information, utilising frameworks aligned with the GHG Protocol.  2. United States: The Securities and Exchange Commission (SEC) has proposed climate disclosure rules that reference the GHG Protocol for emissions reporting.  3. Australia: The National Greenhouse and Energy Reporting (NGER) scheme requires corporations to measure and report their greenhouse gas emissions, with methodologies consistent with the GHG Protocol.  4. South Korea: While sustainability reporting is currently voluntary in South Korea, there are indications that disclosure of GHG emissions will become mandatory in the future.

   
   Scopes Defined by the GHG Protocol: 
   
   1. Scope 1: Direct emissions from owned or controlled sources. This includes emissions from activities such as fuel combustion in company-owned vehicles or facilities, which are directly within the organisation's control.
    
   2. Scope 2: Indirect emissions from the generation of purchased electricity, steam, heating, and cooling. Organisations often have significant influence over these emissions through energy procurement decisions and efficiency measures.
    
   3. Scope 3: All other indirect emissions that occur in a company's value chain. This scope encompasses a wide range of activities, such as upstream supply chain emissions and downstream product use, presenting both challenges and opportunities for comprehensive emissions management. 
   
   
   

2. ISO 14064 

   Overview	ISO 14064 provides a framework for organisations to quantify, monitor, report, and verify their GHG emissions.
   Type	Voluntary international standard.
   Applies To	All industries.
   Where It’s Required	ISO 14064 is not mandated by law but is widely utilised for internal reporting and third-party verification. Organisations adopt this standard to enhance the credibility and consistency of their greenhouse gas emissions reporting.

   
   
   Components of ISO 14064 
   
   – ISO 14064-1: Specifies principles and requirements at the organisation level for quantification and reporting of GHG emissions and removals. It provides a clear structure for organisations to follow, ensuring that all relevant emissions sources are accounted for and reported accurately.  
   
   – ISO 14064-2: Focuses on GHG projects or project-based activities. This component is particularly useful for organisations undertaking specific emissions reduction projects, allowing for detailed tracking and reporting of project outcomes. 
   
   – ISO 14064-3: Provides requirements and guidance for the validation and verification of GHG assertions. Verification is a critical step in the reporting process, offering assurance that reported data is accurate and reliable, and enhancing stakeholder confidence in the organisation’s emissions management efforts.  

   
   

3. Carbon Disclosure Project (CDP) 

   Overview	CDP is a global disclosure system that helps companies publicly report their climate risks, emissions, and environmental strategies.
   Type	Voluntary disclosure system.
   Applies To	Public and private companies reporting to investors.
   Where It’s Required	Thousands of companies globally disclose climate-related data through the CDP platform to meet investor and stakeholder expectations. While not legally required, participation can influence investor decisions and public perception.

   
   

4. Task Force on Climate-related Financial Disclosures (TCFD) 

   Overview	TCFD is a climate risk disclosure framework that helps businesses integrate climate-related risks and opportunities into financial reporting. It focuses on governance, strategy, risk management, and metrics and targets.
   Type	Mandatory in certain jurisdictions; voluntary elsewhere.
   Applies To	Public companies, large businesses, financial institutions.
   Where It’s Required	1. United Kingdom: TCFD-aligned disclosures are mandatory for large companies and financial institutions.  2. European Union: The CSRD incorporates TCFD recommendations, making them effectively mandatory for in-scope companies.  3. Japan, New Zealand, Singapore: These countries have implemented or are in the process of implementing TCFD-based reporting requirements.  4. In other regions, TCFD recommendations serve as a voluntary framework, but adoption is increasing due to investor and stakeholder pressure.

   
   

5. Partnership for Carbon Accounting Financials (PCAF) 

   Overview	PCAF is a global standard for measuring financed emissions in financial institutions. It provides methodologies for corporate lending and investment emissions accounting; mortgage and real estate-related carbon footprints; and insurance and asset management sustainability metrics.
   Type	Mandatory for some financial institutions; voluntary for others.
   Applies To	Banks, insurers, investors, asset managers.
   Where It’s Required	1.European Union: Financial institutions are required to measure and disclose financed emissions, with PCAF providing a standardised approach.  2. Other Regions: While not universally mandated, PCAF is gaining traction as a best practice framework for financial institutions aiming to assess and disclose the carbon impact of their portfolios.

   
   

6. European Sustainability Reporting Standards (ESRS) 

   Overview	The ESRS cover a wide range of topics, including climate change mitigation and adaptation, biodiversity, resource use, and social matters. Companies subject to the CSRD are required to disclose information in accordance with the ESRS, thereby providing stakeholders with consistent and reliable ESG data.
   Type	Mandatory under the CSRD.
   Applies To	Large and listed companies operating within the European Union.
   Where It’s Required	The ESRS are compulsory for companies falling under the scope of the CSRD, which includes large enterprises and those listed on EU-regulated markets. These standards cover a broad range of environmental, social, and governance topics, ensuring comprehensive sustainability reporting.