Support for Transparency Improvement

Support for Transparency Improvement leading to GHG Reduction and ESG Finance.

To ensure proper implementation of the Paris Agreement, an international system has been built so that governments in each country can report on their greenhouse gas (GHG) emissions and the progress of climate change measures implemented based on their Nationally Determined Contributions (NDCs). In addition, to achieve the goals of the Paris agreement, it is vital to “improve the transparency” where companies actively promote the disclosure and monitoring of GHG emissions. The disclosure of environmental information including corporate GHG emissions is becoming particularly important for investors and supply chains, and its importance is also growing every year from the perspective of Environment, Social, and Governance (ESG) finance. Calculating and reporting GHG emissions is now a global task that must be addressed in order to build a foundation for a decarbonized society.

Roles of the OECC

Under the Ministry of the Environment’s transparency initiative Partnerships to Strengthen Transparency for co-Innovation (PaSTI) and JICA’s technical cooperation projects, the OECC provides support in building and implementing systems related to calculating and reporting GHG emissions based on the needs of governments and companies in individual countries, including the development of laws and regulations. We also provide support through disseminating knowledge on the use of ESG finance as an incentive for companies to report their GHG emissions. In addition, we help Japanese companies strengthen their international competitiveness by supporting the visualization of GHG emissions in international supply chains.

Our Business

Capacity Building regarding NDC Implementation Report in the UN Reporting Format

Under the Enhanced Transparency Framework (ETF) stipulated in Article 13 of the Paris Agreement, governments in individual countries are required to submit a transparency report every two years to disclose their GHG emission inventories and Nationally Determined Contribution (NDC) implementation status. The progress of NDC implementation is reported through the use of the newly introduced Common Table Format (CTF). In the report, quantitative and qualitative indicators for progress management must be provided, these being a first for developing countries. The OECC is engaged in the preparation of capacity building on CTFs for governments in developing countries.

Promotional Support for Transparency of Companies and ESG Finance

As GHGs are mainly emitted by business activities, it is important for companies to calculate their GHG emissions and promote their reduction accordingly. In ASEAN partner countries, the OECC provides technical support such as drafting legislation and building systems on GHG accounting reports, developing calculation tools, human resource development and capacity building through workshops and seminars. Furthermore, in collaboration with international organizations and financial institutions working to improve the transparency of global responses to climate change, we are working to create incentives for companies to calculate and report their GHG emissions by promoting ESG finance.

Support for International Supply Chains to Calculate GHG Emissions

Efforts on decarbonization management are expanding particularly in global companies to reduce not only their own GHG emissions, but also those of their supply chains (Scope 3). The OECC is working with Japanese companies that have production bases in Southeast Asia, to identify the calculation categories of Scope 3 emissions in their local supply chains, to collect data from suppliers and assist them in calculating emissions and their reduction measures.