Resources
Glossary
186 terms of sustainability reporting, carbon accounting and the frameworks, defined for the people who use them.
1
- 1.5°C Pathway
- An emissions reduction trajectory consistent with limiting global average temperature increase to 1.5°C above pre-industrial levels, as set out in the Paris Agreement. Requires global CO₂ emissions to reach net zero by approximately 2050.
- Climate targets
A
- Absolute Emissions
- Total greenhouse gas emissions expressed as a quantity (e.g., metric tons of CO₂e) without normalization to any business metric. Used as the primary unit for Scope 1, 2, and 3 reporting under TSRS 2 and the GHG Protocol.
- Carbon accountingMetrics and methodology
- Accreditation (CBAM)CBAM
- The formal recognition of a verifier's competence to perform CBAM verification activities. Under the CBAM Regulation, verifiers must be accredited by a national accreditation body in accordance with Regulation (EC) No 765/2008.
- EU regulation
- Activity Data
- Quantitative measure of a level of activity that results in greenhouse gas emissions, such as fuel consumption (liters), electricity usage (kWh), or distance traveled (km). Multiplied by an emission factor to calculate emissions.
- Carbon accountingMetrics and methodology
- Activity-Based Method
- A Scope 3 calculation approach that uses primary activity data (e.g., liters of fuel, kWh of electricity) multiplied by emission factors. Considered more accurate than the spend-based method and preferred by the GHG Protocol for material Scope 3 categories.
- Carbon accountingMetrics and methodology
- Additionality
- The principle that an emission reduction or removal would not have occurred without the incentive created by carbon credit financing. A core quality criterion for voluntary carbon market credits under standards like VCS and Gold Standard.
- Carbon markets
- Aligned Activities (EU Taxonomy)
- Economic activities that meet the EU Taxonomy's technical screening criteria for substantial contribution to at least one environmental objective while doing no significant harm (DNSH) to any other objective and complying with minimum social safeguards.
- EU regulation
- Article 6 (Paris Agreement)
- The provision in the Paris Agreement governing international carbon market mechanisms. Article 6.2 enables bilateral cooperative approaches with Internationally Transferred Mitigation Outcomes (ITMOs), while Article 6.4 establishes a centralized crediting mechanism supervised by the UN.
- Carbon marketsClimate targets
- Assurance
- Independent examination of sustainability disclosures to enhance their credibility. Under TSRS, KGK requires limited assurance initially (GDS 3000), progressing to reasonable assurance. CSRD mandates limited assurance from the outset.
- Reporting frameworksStandards bodies
- Attributional Life Cycle Assessment
- An LCA approach that describes the environmentally relevant physical flows to and from a product system and its subsystems. It uses average data and allocation to partition impacts among co-products, reflecting the status quo rather than the consequences of a change.
- Metrics and methodology
- Avoided Emissions
- Emission reductions that occur outside a company's value chain as a result of its products or services (e.g., a renewable energy company displacing fossil fuel generation). Not counted toward Scope 1-3 inventories but may be reported separately as a measure of climate contribution.
- Carbon accountingMetrics and methodology
B
- Base Year
- A historical reference period against which emissions are compared over time. The GHG Protocol requires organizations to select a base year for tracking emission trends. SBTi targets are set relative to a base year, typically no earlier than 2015.
- Carbon accountingClimate targets
- Base Year Recalculation
- The process of retroactively adjusting base year emissions to account for structural changes such as mergers, acquisitions, divestitures, or changes in calculation methodology. Required by the GHG Protocol to maintain consistency in emission trends.
- Carbon accountingMetrics and methodology
- Baseline Emissions
- The quantity of greenhouse gases emitted in a reference period (base year) against which future emission reductions are measured. Establishing a robust and verifiable baseline is the first step in any target-setting exercise.
- Carbon accountingMetrics and methodology
- BDDK (Banking Regulation and Supervision Agency)BDDK
- Turkey's banking regulatory authority. Financial institutions under BDDK supervision are automatically within TSRS scope regardless of size thresholds, making them subject to sustainability reporting requirements.
- Turkish regulationFinancial disclosure
- Biodiversity
- The variability among living organisms from all sources, including diversity within species, between species, and of ecosystems. Increasingly recognized as material in sustainability reporting through frameworks like TNFD, ESRS E4, and the Kunming-Montreal Global Biodiversity Framework.
- Governance and socialReporting frameworks
- Biogenic Emissions
- CO₂ emissions from the combustion or decomposition of biologically based materials other than fossil fuels (e.g., biomass, biofuels). Under the GHG Protocol, biogenic CO₂ is reported separately from Scope 1 fossil fuel emissions.
- Carbon accounting
- Board Oversight of Sustainability
- The governance requirement for the board of directors to maintain oversight of sustainability-related risks, opportunities, and strategy. IFRS S1 and TSRS 1 require disclosure of governance processes, including board competencies, meeting frequency, and integration into strategic decision-making.
- Governance and socialReporting frameworks
- Borderline Case (CBAM)
- A situation where it is uncertain whether a specific good falls within the scope of CBAM's covered sectors. The EU Commission has provided guidance on CN code classification for such cases, particularly relevant for complex products containing both covered and non-covered materials.
- EU regulation
C
- Cap and Trade
- A market-based regulatory approach that sets a cap on total emissions for covered entities, distributes or auctions emission allowances, and allows entities to trade allowances. Entities emitting less than their cap can sell surplus allowances; those exceeding must buy from the market or face penalties.
- Carbon marketscarbon-pricing
- CapEx Alignment (EU Taxonomy)
- The proportion of an undertaking's capital expenditures that relates to Taxonomy-aligned economic activities. One of the three mandatory KPIs under EU Taxonomy disclosure requirements, alongside turnover and OpEx alignment.
- EU regulationMetrics and methodology
- Carbon Border Adjustment MechanismCBAM
- An EU policy instrument that puts a carbon price on imports of certain goods to prevent carbon leakage. Importers must purchase CBAM certificates corresponding to the carbon price that would have been paid if the goods had been produced under the EU ETS. Covers cement, iron and steel, aluminum, fertilizers, electricity, and hydrogen.
- EU regulation
- Carbon Budget
- The maximum cumulative amount of CO₂ that can be emitted while still limiting global warming to a specific temperature target. The IPCC estimates the remaining carbon budget for 1.5°C with 50% probability at approximately 500 Gt CO₂ from the start of 2020.
- Climate targets
- Carbon Capture and Storage (CCS)CCS
- A set of technologies that capture CO₂ emissions at their source (e.g., power plants or industrial facilities), transport the captured CO₂, and store it permanently in deep geological formations. Considered essential for decarbonizing hard-to-abate sectors.
- climate-mitigationMetrics and methodology
- Carbon Credit
- A tradable certificate representing the reduction or removal of one metric ton of CO₂ equivalent. Issued under voluntary standards (VCS, Gold Standard) or compliance mechanisms (CDM, Article 6). Not equivalent to an emission allowance under ETS.
- Carbon markets
- Carbon Dioxide EquivalentCO₂e
- A metric used to compare emissions of different greenhouse gases based on their global warming potential (GWP). All seven Kyoto Protocol GHGs are converted to CO₂e for standardized reporting under the GHG Protocol, TSRS 2, and other frameworks.
- Carbon accountingMetrics and methodology
- Carbon Footprint
- The total amount of greenhouse gas emissions caused directly or indirectly by an individual, organization, event, or product, expressed in CO₂ equivalent. For organizations, typically encompasses Scope 1, 2, and relevant Scope 3 categories.
- Carbon accounting
- Carbon Intensity
- Greenhouse gas emissions normalized to a business metric, such as tons of CO₂e per unit of revenue, per employee, or per unit of production. Useful for benchmarking across companies of different sizes. TSRS 2 requires disclosure of both absolute and intensity metrics.
- Carbon accountingMetrics and methodology
- Carbon Leakage
- The displacement of production and associated emissions from a jurisdiction with a carbon price to one without, resulting in no net global emission reduction. CBAM is specifically designed to prevent carbon leakage by equalizing the carbon cost on imports.
- EU regulationCarbon markets
- Carbon Neutral
- A state achieved when an entity's net carbon emissions equal zero, typically through a combination of emission reductions and offsetting residual emissions with carbon credits. Distinct from 'net zero' which requires deeper decarbonization before offsetting.
- Climate targets
- Carbon Offset
- A reduction or removal of greenhouse gas emissions made to compensate for emissions occurring elsewhere. Each offset represents one metric ton of CO₂e. Distinguished from carbon credits by its use as a compensatory mechanism rather than a tradeable commodity in isolation.
- Carbon markets
- Carbon Offset Registry
- A digital platform that tracks the issuance, ownership, transfer, and retirement of carbon credits to prevent double counting and ensure environmental integrity. Major registries include Verra, Gold Standard, ACR, and CAR.
- Carbon markets
- Carbon Pricing
- A mechanism that assigns a cost to greenhouse gas emissions to incentivize reduction. Includes emissions trading systems (cap-and-trade), carbon taxes, and internal carbon pricing. The EU ETS is the world's largest carbon pricing system.
- Carbon marketsEU regulation
- Carbon Removal
- The process of capturing CO₂ from the atmosphere and durably storing it in geological, terrestrial, or ocean reservoirs, or in products. Includes nature-based solutions (afforestation, soil carbon) and engineered approaches (DACCS, BECCS). Distinct from emission reductions.
- Carbon accountingClimate targets
- Carbon Sequestration
- The process of capturing and storing atmospheric carbon dioxide, either through biological processes (forests, soils, oceans) or technological means (direct air capture). A critical mechanism for achieving net-zero targets.
- Carbon accountingClimate targets
- Carbon Tax
- A government-imposed fee on the carbon content of fossil fuels or directly on GHG emissions, creating a financial incentive to reduce emissions. Unlike cap-and-trade, it provides price certainty but not quantity certainty for emission reductions.
- Carbon markets
- CBAM Certificate
- An electronic certificate purchased by EU importers to cover the embedded emissions of CBAM goods. Each certificate corresponds to one tonne of CO₂e. The price is calculated weekly based on the average EU ETS closing price. Certificates can be re-sold to the national authority but not traded between importers.
- EU regulation
- CDP (formerly Carbon Disclosure Project)CDP
- A global non-profit that runs the world's leading environmental disclosure system. Over 23,000 companies and 1,100 cities report through CDP questionnaires on climate change, water security, and forests. CDP scoring (D- to A) is used by investors managing over $130 trillion in assets.
- Reporting frameworks
- Circular Economy
- An economic model that aims to eliminate waste and maximize resource use through design strategies such as reuse, repair, remanufacturing, and recycling. One of the six environmental objectives of the EU Taxonomy and increasingly integrated into corporate sustainability strategies.
- EU regulationGovernance and social
- Climate Adaptation
- The process of adjusting to current or expected climate change effects to moderate harm or exploit beneficial opportunities. Includes infrastructure resilience, water management, agricultural adjustments, and early warning systems. TSRS 2 requires disclosure of adaptation measures.
- Climate targetsGovernance and social
- Climate Justice
- A framework that acknowledges climate change has disproportionate impacts on vulnerable and marginalized communities. Advocates that mitigation and adaptation actions should address historical inequities and prioritize those most affected.
- Governance and socialClimate targets
- Climate Mitigation
- Human interventions to reduce greenhouse gas emissions or enhance carbon sinks. Includes transitioning to renewable energy, improving energy efficiency, and deploying carbon capture technologies. Forms the basis of corporate transition plans and national climate strategies.
- Climate targets
- Climate Neutrality
- A state in which human activities result in no net effect on the climate system, encompassing all greenhouse gases (not only CO₂) and their regional and global effects. Broader than carbon neutrality, which typically covers only CO₂.
- Climate targets
- Climate Resilience
- The capacity of social, economic, and environmental systems to cope with, adapt to, and recover from the effects of climate change. Under CSRD/ESRS, companies must disclose how they are building resilience to physical and transition risks.
- Climate targetsReporting frameworks
- Climate Tipping Point
- A critical threshold in the climate system beyond which a small perturbation can trigger a self-reinforcing, irreversible shift to a new state. Examples include the collapse of ice sheets, dieback of the Amazon rainforest, and disruption of ocean circulation patterns.
- Climate targets
- Climate Value-at-Risk (Climate VaR)
- A forward-looking metric estimating the potential impact of climate change on investment portfolios or asset values under various climate scenarios. Incorporates both physical risks and transition risks, typically expressed as a percentage of portfolio value.
- Financial disclosureMetrics and methodology
- CN Code (Combined Nomenclature)
- The EU's product classification system used to identify goods subject to CBAM. Each CBAM-covered product is identified by specific CN codes (e.g., 7206-7229 for iron and steel). Turkish exporters must verify their products' CN codes to determine CBAM applicability.
- EU regulation
- Consequential Life Cycle Assessment
- An LCA approach that estimates how environmental flows change in response to a decision, using marginal data and system expansion. Useful for policy analysis and strategic decision-making where market-mediated effects are relevant.
- Metrics and methodology
- Consolidation Approach
- The method used to determine organizational boundaries for GHG reporting. The GHG Protocol offers equity share and control (financial or operational) approaches. TSRS 2 requires consistency between the chosen GHG consolidation approach and the approach used for financial statements.
- Carbon accounting
- Corporate Carbon Footprint (CCF)CCF
- The total greenhouse gas emissions caused directly and indirectly by an organization over a defined period, typically one fiscal year. Encompasses Scope 1, 2, and 3 emissions and is calculated following the GHG Protocol Corporate Standard methodology.
- Carbon accounting
- Corporate Sustainability Due Diligence DirectiveCSDDD
- An EU directive (CSDDD/CS3D) requiring large companies to identify, prevent, mitigate, and account for adverse human rights and environmental impacts in their operations and value chains. Applies to companies with 1,000+ employees and €450M+ net turnover.
- EU regulationGovernance and social
- Corporate Sustainability Due Diligence Directive (CSDDD)CSDDD
- EU Directive requiring large companies to identify, prevent, mitigate, and account for adverse human rights and environmental impacts in their own operations, subsidiaries, and value chains. Introduces civil liability provisions and requires adoption of climate transition plans aligned with the Paris Agreement.
- EU regulationGovernance and social
- Corporate Sustainability Reporting DirectiveCSRD
- The EU directive that requires companies to report sustainability information according to European Sustainability Reporting Standards (ESRS). Replaces the Non-Financial Reporting Directive (NFRD). Phase-in from 2024 for large public-interest entities, expanding to SMEs by 2026. Requires double materiality assessment and limited assurance.
- Reporting frameworksEU regulation
D
- Data Quality Score
- A rating system used to assess the reliability and representativeness of emissions data on a scale (typically 1-5, where 1 is highest quality). PCAF applies data quality scores to financed emissions, while the GHG Protocol encourages quality assessment across all scopes to identify improvement areas.
- Metrics and methodologyFinancial disclosure
- Decarbonization
- The process of reducing carbon dioxide and other greenhouse gas emissions from an organization's operations and value chain. Includes energy efficiency, fuel switching, electrification, process changes, and procurement of renewable energy.
- Climate targets
- Default Values (CBAM)
- Emission factors published by the European Commission for use when actual installation-level emissions data is unavailable. During the transitional period, importers could use default values. In the definitive period, default values are penalized and facility-specific data is strongly preferred.
- EU regulation
- Direct Air Capture (DAC)DAC
- A technology that chemically captures CO₂ directly from the ambient atmosphere, as opposed to point-source capture from industrial facilities. Combined with permanent geological storage, it constitutes a carbon dioxide removal pathway.
- Carbon accountingClimate targets
- Direct Emissions (CBAM)
- Emissions from the production process of CBAM goods that are released at the installation level, including emissions from heating, cooling, and process-related chemical reactions. All CBAM sectors must report direct emissions; indirect emissions are additionally required for cement and fertilizers.
- EU regulationCarbon accounting
- Diversity, Equity, and Inclusion (DEI)DEI
- Organizational policies and practices aimed at ensuring fair representation and participation of all individuals regardless of gender, ethnicity, age, disability, or other characteristics. ESRS S1 requires disclosure of workforce diversity metrics and related targets.
- Governance and social
- Do No Significant HarmDNSH
- A principle under the EU Taxonomy requiring that an economic activity substantially contributing to one environmental objective must not significantly harm any of the other five objectives. DNSH criteria are defined in the Climate Delegated Act and Environmental Delegated Act.
- EU regulation
- Double Materiality
- A concept requiring organizations to assess and report on both how sustainability issues affect the business (financial materiality / outside-in) and how the business impacts society and the environment (impact materiality / inside-out). Mandated by CSRD/ESRS and a key distinction from ISSB/TSRS which focus on financial materiality.
- Reporting frameworksMetrics and methodology
E
- EFRAG (European Financial Reporting Advisory Group)EFRAG
- The EU body that develops the European Sustainability Reporting Standards (ESRS) under mandate from the European Commission. EFRAG's Sustainability Reporting Board oversees standard development, including implementation guidance and Q&A publications.
- Standards bodies
- Embedded Emissions
- The greenhouse gas emissions associated with the production of CBAM goods, including both direct emissions from the production process and, for certain sectors, indirect emissions from electricity consumption. Calculated per tonne of product using sector-specific methodologies.
- EU regulationCarbon accounting
- Emission Factor
- A coefficient that quantifies greenhouse gas emissions per unit of activity. For example, kg CO₂e per kWh of electricity, per liter of diesel, or per tonne of cement. Sources include DEFRA, EPA, IPCC, and country-specific databases like Turkey's grid emission factor.
- Carbon accountingMetrics and methodology
- Emission Intensity Ratio
- Greenhouse gas emissions expressed relative to a business metric such as revenue, production output, or floor area (e.g., tCO₂e per million USD revenue). Used alongside absolute emissions to track efficiency improvements and enable cross-company comparisons.
- Metrics and methodologyCarbon accounting
- Emission Reduction Pathway
- A time-bound trajectory of annual emission reductions from a base year toward a defined target, typically aligned with the 1.5°C or well-below 2°C goals of the Paris Agreement. SBTi requires companies to define near-term and long-term pathways.
- Climate targetsMetrics and methodology
- Emissions Trading SystemETS
- A market-based mechanism that sets a cap on total emissions and allows entities to trade emission allowances. The EU ETS is the world's largest, covering power generation, heavy industry, and aviation. Turkey is developing its own ETS framework, which will be critical for CBAM carbon price crediting.
- Carbon marketsEU regulation
- Energy Attribute Certificate (EAC)EAC
- A tradeable instrument that certifies one MWh of electricity was generated from a specific energy source, such as renewable energy. Includes Guarantees of Origin (GOs) in Europe and Renewable Energy Certificates (RECs) in North America. Used for market-based Scope 2 accounting.
- Carbon accountingCarbon markets
- ESG (Environmental, Social, and Governance)ESG
- A framework used to evaluate an organization's performance across environmental stewardship, social responsibility, and corporate governance. ESG factors are increasingly integrated into investment decisions, regulatory requirements, and corporate strategy.
- Governance and social
- ESG Rating
- An assessment provided by specialized agencies (e.g., MSCI, Sustainalytics, ISS) that evaluates a company's exposure to and management of environmental, social, and governance risks. Ratings influence investment decisions but lack standardization across providers.
- Financial disclosure
- EU Deforestation Regulation (EUDR)EUDR
- EU Regulation 2023/1115 requiring operators placing specific commodities (cattle, cocoa, coffee, oil palm, rubber, soya, wood) on the EU market to prove they are deforestation-free and produced in compliance with local laws. Applies a due diligence system with geolocation and traceability requirements.
- EU regulation
- EU Emissions Trading System (EU ETS)EU ETS
- The world's first and largest cap-and-trade system for greenhouse gas emissions, covering power generation, industry, and aviation within the EU. Phase 4 (2021-2030) introduces a steeper emissions cap reduction and the Market Stability Reserve. CBAM is designed as a complementary measure.
- EU regulationCarbon markets
- EU Green Bond Standard (EU GBS)EU GBS
- A voluntary standard establishing uniform requirements for issuers of green bonds who wish to use the designation 'European Green Bond.' Requires alignment of proceeds with the EU Taxonomy and external review by a registered reviewer.
- EU regulationFinancial disclosure
- EU Taxonomy
- A classification system establishing a list of environmentally sustainable economic activities. Defines six environmental objectives: climate change mitigation, climate change adaptation, water and marine resources, circular economy, pollution prevention, and biodiversity. Financial and non-financial undertakings must disclose their Taxonomy alignment.
- EU regulation
- European Green Deal
- The overarching EU strategy to make Europe the first climate-neutral continent by 2050. Encompasses regulatory initiatives across energy, transport, agriculture, finance, and industry, including the Fit for 55 package, CSRD, EU Taxonomy, and CBAM.
- EU regulationClimate targets
- European Sustainability Reporting StandardsESRS
- The disclosure standards developed by EFRAG under the CSRD mandate. Comprise cross-cutting standards (ESRS 1, ESRS 2) and topical standards covering environmental (E1-E5), social (S1-S4), and governance (G1) topics. Require double materiality assessment to determine applicable disclosures.
- Reporting frameworksEU regulation
F
- Financed Emissions
- Greenhouse gas emissions associated with the lending and investment activities of financial institutions, attributable to the institution based on its financial exposure. Calculated using the PCAF Global Standard methodology. Classified as Scope 3, Category 15 under the GHG Protocol.
- Financial disclosureCarbon accounting
- Financial Materiality
- Information about sustainability matters that could reasonably be expected to influence the decisions of primary users of financial reports. The lens used by ISSB (IFRS S1/S2) and TSRS. Focuses on how sustainability risks and opportunities affect the entity's cash flows, access to finance, and cost of capital.
- Reporting frameworksMetrics and methodology
- Fit for 55
- The EU legislative package aiming to reduce net greenhouse gas emissions by at least 55% by 2030 compared to 1990 levels. Includes revisions to the EU ETS, CBAM, renewable energy and energy efficiency directives, and land use regulations.
- EU regulationClimate targets
- FLAG Target (Forest, Land, and Agriculture)FLAG
- An SBTi science-based target specifically covering emissions from forest, land, and agriculture sectors. Companies with significant FLAG emissions (typically >20% of total Scope 3) must set separate FLAG targets that include land-use change emissions and removals, in addition to energy and industrial targets.
- Climate targetsCarbon accounting
- Fugitive Emissions
- Unintentional releases of greenhouse gases from equipment leaks, venting, or other non-point sources. Common examples include refrigerant leaks from HVAC systems, natural gas leaks from distribution networks, and SF₆ leaks from electrical equipment. Reported under Scope 1.
- Carbon accounting
G
- GHG Inventory
- A comprehensive, quantified list of an organization's greenhouse gas emissions and removals, categorized by source, type, and scope. The GHG Protocol Corporate Standard provides the most widely used framework for compiling a GHG inventory.
- Carbon accountingMetrics and methodology
- GHG Protocol
- The world's most widely used greenhouse gas accounting standards, developed by WRI and WBCSD. Comprises the Corporate Standard (2004), Scope 2 Guidance (2015), and Corporate Value Chain (Scope 3) Standard (2011). Referenced by TSRS 2 as the default measurement methodology.
- Carbon accountingStandards bodies
- GHG Protocol Scope 2 Guidance
- A supplement to the GHG Protocol Corporate Standard requiring companies to report Scope 2 emissions using both the location-based method (grid-average emission factors) and the market-based method (contractual instruments such as RECs/GOs).
- Carbon accountingReporting frameworks
- Global Reporting InitiativeGRI
- An international organization that provides the most widely adopted standards for sustainability reporting. GRI Standards use an impact materiality approach (how the organization impacts economy, environment, and people). The 2021 Universal Standards revision introduced new requirements including due diligence and human rights.
- Reporting frameworksStandards bodies
- Global Warming PotentialGWP
- A measure of how much heat a greenhouse gas traps in the atmosphere over a specified time period (typically 100 years), relative to CO₂. Used to convert different GHGs to CO₂ equivalents. IPCC AR6 values: CH₄ = 27.9, N₂O = 273, SF₆ = 25,200.
- Metrics and methodologyCarbon accounting
- Gold Standard
- An independent standard-setting body for voluntary carbon credits, originally established under WWF auspices. Requires projects to demonstrate measurable contributions to the UN Sustainable Development Goals beyond carbon reduction.
- Carbon marketsStandards bodies
- Green Bond
- A fixed-income instrument where proceeds are exclusively applied to finance or refinance projects with environmental benefits, such as renewable energy, energy efficiency, or clean transportation. Issuance follows frameworks like ICMA Green Bond Principles or the EU Green Bond Standard.
- Financial disclosureCarbon markets
- Green Hydrogen
- Hydrogen produced through electrolysis of water using renewable electricity, resulting in zero direct carbon emissions. Considered a key decarbonization vector for hard-to-abate sectors such as steel, chemicals, and heavy transport.
- Climate targetsCarbon markets
- Greenhouse Gas (GHG)GHG
- A gas that absorbs and re-emits infrared radiation in the atmosphere, contributing to the greenhouse effect. The six gases covered by the Kyoto Protocol are CO₂, CH₄, N₂O, HFCs, PFCs, and SF₆; the GHG Protocol also includes NF₃.
- Carbon accounting
- Greenwashing
- The practice of making misleading claims about the environmental benefits of a product, service, or company practice. EU regulations including the CSRD and Green Claims Directive are increasingly targeting greenwashing with requirements for substantiation and third-party verification.
- Governance and social
- GRI Universal Standards (2021)
- The revised set of GRI standards effective from January 2023, structured into Universal Standards (GRI 1-3), Sector Standards, and Topic Standards. GRI 1 establishes the foundation, GRI 2 covers general disclosures, and GRI 3 addresses material topics determination.
- Standards bodiesReporting frameworks
H
- Human Rights Due Diligence (HRDD)HRDD
- An ongoing process by which companies identify, prevent, mitigate, and account for adverse human rights impacts across their operations and value chain. Anchored in the UN Guiding Principles on Business and Human Rights and legally mandated by the EU CSDDD.
- Governance and socialEU regulation
I
- ICMA Green Bond PrinciplesICMA
- Voluntary process guidelines published by the International Capital Market Association (ICMA) for issuing green bonds. The four core components are: use of proceeds, process for project evaluation and selection, management of proceeds, and reporting.
- Standards bodiesFinancial disclosure
- IFRS S1 (General Requirements for Disclosure of Sustainability-related Financial Information)IFRS S1
- The ISSB's foundational standard for sustainability-related financial disclosures. Establishes the overall framework, core concepts, and general requirements. Translated into Turkish as TSRS 1 by KGK. Uses the four-pillar disclosure structure: Governance, Strategy, Risk Management, Metrics and Targets.
- Reporting frameworks
- IFRS S2 (Climate-related Disclosures)IFRS S2
- The ISSB's climate-specific disclosure standard. Requires entities to disclose climate-related risks and opportunities, including Scope 1, 2, and 3 GHG emissions, scenario analysis, and transition plans. Translated into Turkish as TSRS 2 by KGK. References the GHG Protocol as the default measurement methodology.
- Reporting frameworks
- Impact Materiality
- Assessment of an organization's actual or potential impact on the economy, environment, and people. The lens used by GRI Standards and CSRD/ESRS (as part of double materiality). Focuses on the inside-out perspective: how the entity affects the world.
- Reporting frameworksMetrics and methodology
- Installation (CBAM)
- A stationary technical unit where one or more CBAM production processes are carried out. Each installation has defined system boundaries that determine which emissions are included in the embedded emissions calculation. Turkish factories exporting to the EU are classified as installations under CBAM.
- EU regulation
- Integrated Reporting
- A reporting approach that communicates how an organization's strategy, governance, performance, and prospects create value over the short, medium, and long term, integrating financial and non-financial information in a single report.
- Reporting frameworks
- Integrity Council for the Voluntary Carbon Market (ICVCM)ICVCM
- An independent governance body that sets and enforces global benchmark standards for carbon credit quality through its Core Carbon Principles (CCPs). Credits meeting CCP criteria are labeled as CCP-Approved, signaling high integrity to buyers.
- Standards bodiesCarbon markets
- Internal Carbon Price
- A monetary value assigned to carbon emissions by an organization for internal decision-making. Used to evaluate investments, drive operational efficiency, and prepare for future carbon pricing regulations. TSRS 2 requires disclosure of whether the entity uses an internal carbon price.
- Carbon marketsClimate targets
- IPCC (Intergovernmental Panel on Climate Change)IPCC
- The United Nations body for assessing the science related to climate change. Its Assessment Reports (AR5, AR6) provide the global warming potential values used to convert greenhouse gases to CO₂ equivalents. IPCC emission factor databases are referenced by the GHG Protocol and TSRS 2.
- Standards bodies
- ISO 14001
- The international standard for environmental management systems (EMS), providing a framework for organizations to manage environmental responsibilities systematically. Certification requires demonstrating continual improvement, compliance with regulations, and prevention of pollution.
- Standards bodies
- ISO 14044
- The international standard specifying requirements and guidelines for life cycle assessment (LCA), including goal and scope definition, life cycle inventory analysis, life cycle impact assessment, and interpretation. Used alongside ISO 14040 as the methodological basis for LCA studies.
- Standards bodiesMetrics and methodology
- ISO 14064
- The international standard for greenhouse gas accounting and verification. Part 1 covers organizational-level GHG inventories, Part 2 covers project-level quantification, and Part 3 covers verification. Largely aligned with the GHG Protocol. ESRS E1 accepts ISO 14064 as an alternative to the GHG Protocol.
- Standards bodiesCarbon accounting
- ISO 50001
- The international standard for energy management systems, providing a framework for establishing energy performance indicators, baselines, and action plans. Helps organizations systematically reduce energy consumption and related greenhouse gas emissions.
- Standards bodies
- ISSB (International Sustainability Standards Board)ISSB
- A board established by the IFRS Foundation in 2021 to develop a comprehensive global baseline of sustainability-related financial disclosures. Published IFRS S1 and S2 in June 2023. Turkey adopted these as TSRS 1 and TSRS 2 through KGK.
- Standards bodiesReporting frameworks
J
- Just Transition
- A framework ensuring that the transition to a low-carbon economy is fair and inclusive, addressing the social and economic impacts on workers, communities, and regions dependent on fossil fuel industries. Recognized in the Paris Agreement preamble and EU Just Transition Mechanism.
- Governance and socialClimate targets
K
- KGK (Public Oversight, Accounting and Auditing Standards Authority)KGK
- Turkey's accounting and auditing standards authority, responsible for translating and adopting ISSB standards as TSRS. KGK determines scope thresholds for TSRS applicability and oversees the assurance framework for sustainability reporting in Turkey.
- Turkish regulationStandards bodies
- KGK Sustainability Reporting Standards
- The set of Turkish sustainability reporting standards (TSRS 1 and TSRS 2) issued by KGK (Public Oversight Authority), aligned with IFRS S1 and S2. These standards establish mandatory sustainability disclosure requirements for companies within KGK's reporting scope in Turkey.
- Turkish regulationReporting frameworks
L
- Life Cycle Assessment (LCA)LCA
- A systematic methodology for evaluating the environmental impacts of a product, process, or service throughout its entire life cycle, from raw material extraction through production, use, and end-of-life disposal. Governed by ISO 14040 and ISO 14044 standards.
- Metrics and methodology
- Limited Assurance
- A level of assurance where the practitioner expresses a negative conclusion: 'nothing has come to our attention that causes us to believe there is a material misstatement.' Less rigorous than reasonable assurance. The initial level required under both CSRD and TSRS.
- Reporting frameworks
- Living Wage
- The minimum income necessary for a worker to meet basic needs including food, housing, and healthcare for themselves and their family. Distinguished from minimum wage, which may be legally mandated but insufficient. ESRS S1 and S2 require disclosure on living wage policies across operations and the value chain.
- Governance and social
- Location-Based Method (Scope 2)
- A method for calculating Scope 2 emissions using the average emission intensity of the electricity grid where consumption occurs. Based on the grid emission factor. TSRS 2 requires location-based Scope 2 disclosure as a minimum.
- Carbon accounting
- Loss and Damage
- The negative impacts of climate change that cannot be avoided through mitigation or adapted to, including economic losses and non-economic losses such as loss of biodiversity, cultural heritage, and territory. COP27 established a dedicated fund for this purpose.
- Climate targets
M
- Marginal Abatement Cost Curve (MACC)MACC
- A graphical representation of the cost-effectiveness of various emission reduction measures, ranked from cheapest to most expensive per tonne of CO₂e avoided. Used by companies and policymakers to prioritize decarbonization investments.
- Metrics and methodologyCarbon accounting
- Market-Based Method (Scope 2)
- A method for calculating Scope 2 emissions using emission factors specific to the energy purchased through contractual instruments such as renewable energy certificates (I-REC, GO), supplier-specific factors, or power purchase agreements (PPAs).
- Carbon accounting
- Materiality Assessment
- The process of identifying which sustainability topics are most relevant for an entity's reporting. Under TSRS/ISSB: financial materiality only (enterprise value lens). Under CSRD/ESRS: double materiality (both financial and impact). Under GRI: impact materiality only.
- Reporting frameworksMetrics and methodology
- Materiality Matrix
- A visual tool that plots sustainability topics on two axes—typically significance of impact and importance to stakeholders—to prioritize which issues warrant disclosure and management attention. Under ESRS double materiality, both impact and financial dimensions must be assessed.
- Metrics and methodologyReporting frameworks
- Minimum Safeguards (EU Taxonomy)
- Procedures implemented by an undertaking to ensure alignment with the OECD Guidelines for Multinational Enterprises and the UN Guiding Principles on Business and Human Rights. A prerequisite for EU Taxonomy alignment alongside the DNSH and Technical Screening Criteria.
- EU regulationGovernance and social
N
- Nature-Based Solutions (NbS)NbS
- Actions to protect, sustainably manage, and restore natural or modified ecosystems that address societal challenges while providing human well-being and biodiversity benefits. Includes reforestation, wetland restoration, and regenerative agriculture.
- Climate targetsbiodiversity
- Negative Emissions
- The removal of greenhouse gases from the atmosphere through human activities, resulting in a net reduction in atmospheric GHG concentration. Technologies include BECCS, direct air capture, enhanced weathering, and biochar.
- Carbon accountingClimate targets
- Net Zero
- A state where the greenhouse gases emitted into the atmosphere are balanced by removals. Under SBTi's Net-Zero Standard, companies must reduce value chain emissions by at least 90% from base year levels, with only residual emissions (≤10%) neutralized through permanent carbon removals.
- Climate targets
O
- Operational Control Approach
- An organizational boundary method under the GHG Protocol where the entity reports 100% of emissions from operations where it has the authority to introduce and implement operating policies. The most commonly used consolidation approach, particularly recommended for Turkish enterprises under TSRS 2.
- Carbon accounting
- Organizational Boundary
- The boundary that determines which operations, facilities, and entities are included in a company's GHG inventory. Can be set using the equity share, financial control, or operational control approach as defined by the GHG Protocol.
- Carbon accounting
P
- Paris Agreement
- The 2015 international treaty under the UNFCCC aiming to limit global warming to well below 2°C above pre-industrial levels, with efforts to limit it to 1.5°C. Provides the scientific basis for SBTi target-setting pathways and is referenced across all major sustainability reporting frameworks.
- Climate targetsStandards bodies
- PAS 2080
- A specification for managing whole-life carbon emissions in infrastructure projects, covering both embodied carbon (materials, construction) and operational carbon. Published by BSI, it provides a framework for carbon management across the infrastructure value chain.
- Standards bodiesCarbon accounting
- PCAF (Partnership for Carbon Accounting Financials)PCAF
- A global initiative providing the standard methodology for financial institutions to measure and disclose greenhouse gas emissions associated with their loans and investments. The PCAF Global Standard covers seven asset classes with specific attribution rules and data quality scoring.
- Financial disclosureStandards bodies
- Physical Risk
- Financial risk stemming from the physical impacts of climate change, including acute events (floods, storms, wildfires) and chronic shifts (rising temperatures, sea level rise). TCFD and ISSB frameworks require disclosure of physical risk exposure and management strategies.
- Financial disclosureClimate targets
- Planetary Boundaries
- A framework identifying nine Earth system processes with quantified boundaries within which humanity can safely operate. Proposed by Johan Rockstrom et al. (2009), it includes climate change, biodiversity loss, nitrogen cycle, and freshwater use among others.
- Climate targetsMetrics and methodology
- Power Purchase Agreement (PPA)PPA
- A long-term contract between an electricity buyer and a renewable energy generator, securing a fixed price for energy over a defined period. Physical PPAs involve direct delivery; virtual PPAs are financial contracts settled against market prices. Key instrument for corporate renewable energy procurement and Scope 2 reduction.
- Carbon accountingFinancial disclosure
- Precursor (CBAM)
- An intermediate product used in the production of a CBAM good whose emissions must be included in the embedded emissions calculation. For example, pig iron is a precursor to steel; clinker is a precursor to cement. The emissions from producing the precursor are attributed to the final CBAM product.
- EU regulation
- Principal Adverse Impact (PAI)PAI
- Under SFDR, the most significant negative effects of investment decisions on sustainability factors, including environmental, social, employee, human rights, anti-corruption, and anti-bribery matters. Financial market participants must disclose how they consider PAIs.
- Financial disclosureEU regulation
- Product Carbon Footprint (PCF)PCF
- The total greenhouse gas emissions associated with a product throughout its life cycle, from raw material extraction to end-of-life. Calculated following ISO 14067 or the GHG Protocol Product Standard. Increasingly requested by customers for supply chain transparency and Scope 3 reporting.
- Carbon accountingMetrics and methodology
R
- Reasonable Assurance
- The highest level of assurance, equivalent to a financial statement audit. The practitioner expresses a positive opinion: 'the information is presented fairly, in all material respects.' The targeted future level for TSRS sustainability disclosures.
- Reporting frameworks
- REDD+
- Reducing Emissions from Deforestation and Forest Degradation, plus conservation, sustainable management, and enhancement of forest carbon stocks. A UNFCCC framework that creates financial incentives for developing countries to reduce forest-related emissions, often generating carbon credits.
- Carbon marketsClimate targets
- Regenerative Agriculture
- Farming and grazing practices that reverse climate change by rebuilding soil organic matter and restoring degraded soil biodiversity, resulting in carbon drawdown and improved water cycles.
- Climate targetsCarbon accounting
- Representative Concentration Pathway (RCP)RCP
- A set of greenhouse gas concentration trajectories adopted by the IPCC for climate modeling. RCPs (2.6, 4.5, 6.0, 8.5) describe different levels of radiative forcing by 2100 and are used in scenario analysis for climate risk assessment.
- Climate targetsMetrics and methodology
- Residual Emissions
- Greenhouse gas emissions that remain after all feasible reduction measures have been implemented within a company's value chain. Under the SBTi Net-Zero Standard, companies must neutralize residual emissions (typically no more than 5-10% of baseline) through permanent carbon removals to achieve net-zero status.
- Carbon accountingClimate targets
S
- SBTi (Science Based Targets initiative)SBTi
- A partnership between CDP, UNGC, WRI, and WWF that defines and promotes best practice in science-based target setting. Provides methodologies for near-term targets (5-10 years) and net-zero targets. Validates company targets against 1.5°C-aligned pathways.
- Climate targetsStandards bodies
- Scenario Analysis
- A process for identifying and assessing the potential implications of a range of plausible future states under conditions of uncertainty. TSRS 2 requires climate-related scenario analysis to assess resilience, including at minimum a scenario aligned with the Paris Agreement's temperature goals.
- Reporting frameworksMetrics and methodology
- Science-Based Target
- An emissions reduction target consistent with the level of decarbonization required to keep global temperature increase to 1.5°C above pre-industrial levels. Validated by the SBTi, science-based targets must cover Scope 1, 2, and typically material Scope 3 emissions with near-term (5-10 year) and long-term (by 2050) timeframes.
- Climate targetsMetrics and methodology
- Scope 1 Emissions
- Direct greenhouse gas emissions from sources owned or controlled by the reporting entity. Includes stationary combustion (boilers, furnaces), mobile combustion (company vehicles), process emissions (chemical reactions), and fugitive emissions (refrigerant leaks).
- Carbon accounting
- Scope 2 Emissions
- Indirect greenhouse gas emissions from the generation of purchased or acquired electricity, steam, heating, or cooling consumed by the reporting entity. Can be calculated using location-based (grid average) or market-based (contractual instruments) methods. TSRS 2 requires location-based disclosure.
- Carbon accounting
- Scope 3 Categories
- The 15 categories of indirect emissions defined by the GHG Protocol Corporate Value Chain Standard. Upstream categories (1-8) include purchased goods, capital goods, fuel and energy, transportation, waste, business travel, employee commuting, and leased assets. Downstream categories (9-15) cover transportation, processing, use of sold products, end-of-life treatment, leased assets, franchises, and investments.
- Carbon accounting
- Scope 3 Emissions
- All other indirect emissions occurring in the entity's value chain, divided into 15 categories (8 upstream, 7 downstream). Typically represents 70-90% of total emissions. TSRS 2 mandates Scope 3 disclosure with a one-year transition relief for first-time reporters.
- Carbon accounting
- Sectoral Decarbonization Approach (SDA)SDA
- An SBTi target-setting method that allocates a global carbon budget to individual companies based on their sector's emissions pathway. Used for homogeneous sectors where activity-based intensity targets are appropriate (e.g., power generation, cement, steel).
- Climate targetsMetrics and methodology
- SFDR (Sustainable Finance Disclosure Regulation)SFDR
- An EU regulation requiring financial market participants and financial advisers to disclose sustainability-related information about financial products. Defines Article 6 (no sustainability claims), Article 8 (promotes E/S characteristics), and Article 9 (sustainable investment objective) product categories.
- EU regulationFinancial disclosure
- SFDR Article 8 Fund
- A financial product that promotes environmental or social characteristics, provided that the companies in which investments are made follow good governance practices. Often referred to as 'light green' funds under the SFDR classification.
- Financial disclosureEU regulation
- SFDR Article 9 Fund
- A financial product that has sustainable investment as its objective. Also known as 'dark green' funds, these products must demonstrate that investments are directed toward measurable environmental or social goals.
- Financial disclosureEU regulation
- Spend-Based Method
- A Scope 3 calculation approach that estimates emissions by multiplying procurement spend data by environmentally extended input-output (EEIO) emission factors. Useful as a screening method but less accurate than activity-based approaches.
- Carbon accountingMetrics and methodology
- SPK (Capital Markets Board of Turkey)SPK
- Turkey's capital markets regulatory authority. Companies under SPK supervision (listed companies, investment firms, portfolio management companies) are automatically within TSRS scope. SPK also issues its own sustainability reporting communiqués for listed entities.
- Turkish regulation
- SPK Sustainability Principles
- Guidelines issued by SPK (Capital Markets Board of Turkey) requiring listed companies to report on ESG matters on a comply-or-explain basis. Covers governance, environmental, and social indicators aligned with international frameworks and forms the basis of sustainability reporting for Borsa Istanbul-listed companies.
- Turkish regulationFinancial disclosure
- Stakeholder Engagement
- The systematic process of identifying, consulting, and involving affected and interested parties in sustainability decision-making. A core requirement of double materiality assessments under ESRS and essential for credible sustainability reporting.
- Governance and socialReporting frameworks
- Stranded Assets
- Assets that have suffered unanticipated or premature write-downs, devaluations, or conversion to liabilities due to climate-related factors such as regulatory changes, technological disruption, or shifting market preferences. Fossil fuel reserves are the most commonly cited example.
- Financial disclosureClimate targets
- Supplier Engagement
- The process of working with suppliers to collect primary emissions data, set reduction targets, and improve environmental performance. Critical for Scope 3 accuracy. SBTi's supplier engagement target requires 67% of suppliers by emissions to set their own science-based targets within 5 years.
- Climate targetsCarbon accounting
- Supply Chain Emissions
- Greenhouse gas emissions arising from a company's upstream supply chain activities, primarily captured under Scope 3 Category 1 (Purchased Goods and Services) and Category 4 (Upstream Transportation and Distribution). Typically the largest source of corporate emissions for non-manufacturing companies.
- Carbon accountingGovernance and social
- Supply Chain Transparency
- The disclosure of information about a company's suppliers, sourcing practices, and environmental and social conditions throughout its value chain. Required under CSDDD and increasingly expected by investors and consumers.
- Governance and socialEU regulation
- Sustainability Accounting Standards Board (SASB)SASB
- A standards body (now part of the IFRS Foundation) that developed industry-specific sustainability disclosure standards for 77 industries across 11 sectors. SASB standards focus on financially material sustainability topics and are widely used by investors.
- Standards bodiesReporting frameworks
- Sustainability-Linked Loan (SLL)SLL
- A loan instrument where the financial terms (typically interest rate margins) are tied to the borrower's achievement of predefined sustainability performance targets (SPTs). Unlike green bonds, proceeds are not restricted to specific green projects.
- Financial disclosure
- Sustainable Finance
- The integration of environmental, social, and governance considerations into financial decision-making, products, and services. Encompasses green bonds, ESG investing, climate risk assessment, and regulatory frameworks like the EU Taxonomy and SFDR.
- Financial disclosure
- Sustainable Investment (SFDR)
- Under SFDR Article 2(17), an investment in an economic activity that contributes to an environmental or social objective, does not significantly harm any other objective, and the investee company follows good governance practices.
- Financial disclosureEU regulation
T
- Taskforce on Nature-related Financial Disclosures (TNFD)TNFD
- A global initiative that provides a risk management and disclosure framework for organizations to report on nature-related dependencies, impacts, risks, and opportunities. Built on the TCFD structure with the LEAP approach (Locate, Evaluate, Assess, Prepare).
- Standards bodiesReporting frameworks
- Taxonomy Alignment
- The degree to which an economic activity or financial product meets the EU Taxonomy technical screening criteria, DNSH conditions, and minimum social safeguards. Expressed as a percentage of revenue, CapEx, or OpEx that qualifies as environmentally sustainable.
- EU regulationFinancial disclosure
- Taxonomy Eligibility
- Whether an economic activity is described in the EU Taxonomy delegated acts, regardless of whether it meets the technical screening criteria. Eligibility is a prerequisite for alignment assessment but does not imply environmental sustainability.
- EU regulation
- TCFD (Task Force on Climate-related Financial Disclosures)TCFD
- A task force created by the FSB that developed the four-pillar framework for climate-related financial disclosures: Governance, Strategy, Risk Management, Metrics and Targets. TCFD recommendations have been subsumed by the ISSB (IFRS S2/TSRS 2) and are now the global baseline.
- Reporting frameworksStandards bodies
- Technical Screening Criteria (TSC)TSC
- Detailed, quantitative and qualitative thresholds set by the European Commission that an economic activity must meet to qualify as making a substantial contribution to one of the EU Taxonomy's six environmental objectives.
- EU regulation
- Transition Finance
- Financial instruments and frameworks that support companies in high-emitting sectors to transition toward lower-carbon business models. Distinct from green finance, which funds already-sustainable activities.
- Financial disclosureCarbon markets
- Transition Plan
- A time-bound action plan outlining how an entity will modify its assets, operations, and business model to achieve its climate targets. TSRS 2 requires disclosure of the entity's transition plan, including capital allocation, technology assumptions, and reliance on carbon offsets.
- Climate targetsReporting frameworks
- Transition Risk
- Financial risks arising from the process of adjusting to a lower-carbon economy. Includes policy and legal risks (carbon pricing, regulation), technology risks (disruption, stranded assets), market risks (shifting demand), and reputation risks. One of the two main risk categories under TSRS 2.
- Reporting frameworks
- TSRS (Turkey Sustainability Reporting Standards)TSRS
- Turkey's national sustainability reporting standards, adopted by KGK as Turkish translations of ISSB's IFRS S1 and S2. TSRS 1 covers general disclosure requirements; TSRS 2 covers climate-related disclosures. Published in the Official Gazette on December 29, 2023. Applicable to entities exceeding defined size thresholds or under direct regulatory supervision.
- Reporting frameworksTurkish regulation
- Turkey Green Taxonomy
- Turkey's classification system being developed to define environmentally sustainable economic activities, drawing on the EU Taxonomy framework. Aims to channel financial flows toward green investments and support Turkey's net-zero 2053 target.
- Turkish regulationFinancial disclosure
- Turkish Climate Law
- Framework legislation being developed to establish Turkey's legal foundation for climate action, including the national emissions trading system, carbon pricing mechanisms, and sectoral emission reduction targets. Expected to align with Turkey's net-zero 2053 commitment.
- Turkish regulation
- Turkish Emissions Trading System (TR-ETS)TR-ETS
- Turkey's planned cap-and-trade system for greenhouse gas emissions, being developed as part of Turkey's climate policy framework and EU accession alignment. Expected to cover energy-intensive industries and power generation, with pilot phases preceding full implementation.
- Turkish regulationCarbon markets
U
- Uncertainty Analysis
- A systematic procedure to quantify and communicate the uncertainty associated with GHG emission estimates. Includes assessment of data quality, emission factor accuracy, and methodological choices. ISO 14064-1 requires organizations to address uncertainty in their GHG inventories.
- Metrics and methodology
V
- Value Chain
- The full range of activities and entities upstream (supply chain) and downstream (distribution, use, end-of-life) of a reporting entity. Scope 3 emissions encompass value chain emissions. TSRS 2 requires disclosure of material climate-related risks and opportunities across the value chain.
- Carbon accountingGovernance and social
- Verification (CBAM)
- The independent assessment of embedded emissions data reported by installation operators under CBAM. In the definitive period, verification by an accredited verifier is mandatory. Verifiers must follow the methodology specified in the CBAM Implementing Regulation.
- EU regulation
- Verified Emission Reduction (VER)VER
- A unit representing one tonne of CO₂e that has been independently verified to have been reduced or removed. VERs are typically traded in voluntary carbon markets, as distinct from compliance-market allowances.
- Carbon markets
- Verra (VCS)VCS
- The world's largest voluntary carbon market standard-setting body, operating the Verified Carbon Standard (VCS) program. VCS-certified credits represent approximately 70% of the global voluntary carbon market by volume.
- Carbon marketsStandards bodies
- Voluntary Carbon MarketVCM
- A market where carbon credits are traded voluntarily, outside of compliance obligations. Allows companies to offset emissions through projects that reduce or remove greenhouse gases. Governed by standards like VCS (Verra), Gold Standard, and increasingly by VCMI and ICVCM integrity frameworks.
- Carbon markets
- Voluntary Carbon Markets Integrity Initiative (VCMI)VCMI
- A multi-stakeholder initiative that provides guidance on credible use of carbon credits through its Claims Code of Practice. Establishes criteria for companies to make Gold, Silver, or Bronze claims based on their emission reduction progress and carbon credit quality.
- Standards bodiesCarbon markets
W
- Water Stress
- A condition where water demand exceeds available supply or where poor quality restricts its use. Measured using indicators like the WRI Aqueduct Water Risk Atlas. ESRS E3 and CDP Water Security questionnaire require disclosure of operations in water-stressed areas and management responses.
- Metrics and methodologyReporting frameworks
- Well-to-Tank (WTT)WTT
- Upstream emissions associated with the extraction, refining, and transportation of a fuel before it is combusted. WTT factors are added to direct combustion factors to provide a complete lifecycle picture of energy-related emissions.
- Carbon accounting