Sustainability and ESG reporting

Sustainability and ESG reporting

What UK businesses are asked to report on emissions, how Scope 1, 2 and 3 work, and how Business Central captures sustainability data with your finances.

Talk to an expert

Why sustainability data belongs with your finance data

Customers, public buyers, lenders and investors increasingly want to know a business's carbon footprint. For many growing businesses the first request arrives in a tender or a supplier questionnaire, with a deadline and little warning.

Most of the data needed to answer it already passes through your finance system: fuel and energy bills, purchase invoices, travel claims and waste collections. Recording emissions alongside those transactions, rather than rebuilding them in a spreadsheet once a year, makes the figures quicker to produce, easier to check and consistent from one year to the next.

Why now

Who is asking for emissions data

Some reporting is a legal duty for large companies. For most growing businesses, the request comes from customers, public buyers and lenders.

  • Large companies

    Streamlined Energy and Carbon Reporting (SECR)

    Large UK companies and LLPs report their energy use, greenhouse gas emissions and an intensity ratio in their annual report, along with what they have done to improve energy efficiency.

  • Public contracts

    Carbon Reduction Plans (PPN 006)

    Suppliers bidding for central government contracts worth more than £5 million a year publish a Carbon Reduction Plan with Scope 1 and 2 emissions, five specified Scope 3 categories and a commitment to net zero by 2050.

  • Investors

    UK Sustainability Reporting Standards

    UK SRS S1 and S2, based on the ISSB standards, were published for voluntary use on 25 February 2026. Listed companies and larger private companies may be required to use them in future.

  • Customers

    Supply chain requests

    Larger customers need Scope 3 data from their suppliers to report their own emissions, so smaller businesses are increasingly asked for figures in tenders and supplier reviews.

Based on UK government guidance published by November 2026. This guide is general information, not legal or reporting advice, so check the latest guidance or speak to your adviser about your own position.

The basics

Scope 1, 2 and 3 emissions explained

The Greenhouse Gas Protocol splits a business's emissions into three scopes. Most reporting asks for all three, starting with the first two.

  • Scope 1

    Direct emissions

    Fuel burned in your own boilers, furnaces and vehicles, plus leaks from refrigeration and air conditioning.

  • Scope 2

    Purchased energy

    Emissions from generating the electricity, heat or steam your business buys from suppliers.

  • Scope 3

    Value chain

    Everything else: purchased goods and services, transport, waste, business travel, commuting and how customers use and dispose of your products.

Business Central

How Business Central captures sustainability data

Sustainability features sit inside Microsoft Dynamics 365 Business Central, so emissions are recorded from the same transactions as your finances.

  • Sustainability journals

    Record fuel, energy and other activity data, enter known emissions or let built-in formulas calculate them.

  • Emissions on purchases

    Capture emissions on purchase documents, so Scope 3 data builds up as you buy rather than at year end.

  • CO2 equivalent

    Convert carbon dioxide, methane and nitrous oxide to CO2e for consistent totals across every scope.

  • Water and waste

    Track water withdrawn and discharged and waste disposed or diverted alongside your emissions.

  • Reports by scope and site

    Total emissions, emissions per facility and emissions by category, with Power BI reports for deeper analysis.

  • Social and governance data

    Use statistical accounts for non-financial measures such as headcount or training hours, ready for ESG reporting.

Explore Microsoft Dynamics 365 Business Central
Getting started

Five steps to your first emissions report

A clear, repeatable method matters more than perfect precision in the first year.

  1. 1

    Set your boundary and baseline

    Decide which companies, sites and activities you include, and pick a baseline year to measure progress against.

  2. 2

    Set up sustainability accounts

    Create accounts and categories by scope in Business Central, mirroring how you already structure your finance data.

  3. 3

    Capture activity data

    Record fuel, energy, purchases, travel and waste as they happen, from journals and purchase documents.

  4. 4

    Apply conversion factors

    Use published emission factors to turn activity into CO2e, and keep the source and year with each figure.

  5. 5

    Report and set targets

    Report by scope, site and category, answer customer and tender requests, and track reductions against your baseline.

Articles

More on sustainability and carbon accounting

Our articles on measuring and reporting emissions with Microsoft Dynamics 365.

Carbon accounting in practice

How a small or mid-sized business can capture the activity data behind its emissions inside Business Central, rather than in a separate spreadsheet.

Related guides

Where to go next

Systems and guides that sit alongside sustainability reporting.

Enquiry form

Want your emissions data in the same place as your finances?

Tell us what you've been asked to report and how you collect the data today, and we'll show you how Business Central could help.

TD SYNNEX and its elite Dynamics partner network need the contact information you provide to us to contact you about our products and services. You may unsubscribe from these communications at any time. For information on how to unsubscribe, as well as our privacy practices and commitment to protecting your privacy, please review our Privacy Policy.

FAQ

Frequently asked questions

Yes. Microsoft Dynamics 365 Business Central includes sustainability features that record greenhouse gas emissions by scope, convert them to CO2 equivalent, and track water and waste. Data can come from sustainability journals, general journals or purchase documents, and built-in reports show emissions by scope, category and site.

They are the three groups set out by the Greenhouse Gas Protocol. Scope 1 covers emissions you create directly, such as fuel burned in your boilers and vehicles. Scope 2 covers the energy you buy, mainly electricity. Scope 3 covers everything else in your value chain, from purchased goods and transport to business travel, commuting and waste.

It depends on your size and who you sell to. Large UK companies and LLPs report under SECR in their annual report, suppliers bidding for major central government contracts need a Carbon Reduction Plan, and many smaller businesses are asked for emissions data by their larger customers. Check your own position with your accountant or adviser.

UK SRS S1 and S2 are the UK versions of the ISSB's global sustainability and climate disclosure standards. The government published them for voluntary use on 25 February 2026, and is considering when listed companies and larger private companies should be required to use them.

Mostly from records you already keep: fuel and energy bills, purchase invoices, mileage and travel claims, and waste collections. Multiplying that activity data by published conversion factors, such as the UK government's greenhouse gas conversion factors, gives the emissions figure. Capturing it at the point of purchase saves chasing it at year end.

Start with Scope 1 and 2, because the data sits in your fuel and energy bills. Pick a baseline year, record the figures consistently each month, then add the Scope 3 categories your customers ask about most. A clear, repeatable method matters more than perfect precision in the first year.