ESG and carbon reporting is easier to learn in order. This page takes you through the subject in five steps and points to the page that covers each step in full.
Step 1ESG reporting basics
ESG stands for Environmental, Social and Governance. An ESG report sets out how a business affects the environment and people, and how it is run.
For most firms the environmental part comes first, because that is where customers and regulators ask for figures: energy use, emissions, waste and water. Social covers people, such as health and safety, pay, training and conditions in your supply chain. Governance covers how decisions are made: policies, ownership, and who signs off what you publish.
The best single place to begin is carbon accounting, from the ground up.
Why smaller firms get asked
Most reporting rules are written for large companies. They reach smaller firms through the chain, because the large company needs figures from its suppliers to complete its own report.
A British Business Bank survey found that 37% of UK firms with 50 to 249 staff, and 20% of firms with 10 to 49 staff, had been asked for carbon data in the previous 12 months.
Source: British Business Bank, October 2025.
Public buyers ask too. UK central government contracts worth more than £5 million a year require a Carbon Reduction Plan under Procurement Policy Note 006, and large manufacturers send sustainability questionnaires to their suppliers.
Step 2Carbon accounting
Your carbon footprint sits underneath almost every ESG request. It is measured in three scopes: Scope 1 for fuel you burn yourself, Scope 2 for the electricity and heat you buy, and Scope 3 for everything else in your value chain.
Scope 3 is usually the largest and the hardest part, because the data sits with other companies. Most firms start with Scope 1 and 2 from their own bills, then widen the boundary.
Read how a footprint is measured from your bills.
Step 3Compliance frameworks
Which rules apply depends on your size, where you trade and who your customers are. The ones suppliers meet most often:
- SECR: quoted companies and large unquoted companies and LLPs report energy and emissions in the directors' report.
- Carbon Reduction Plan: bidders for central government contracts above £5 million a year publish one.
- CSRD and VSME: EU rules. After the Omnibus I changes, CSRD covers groups with more than 1,000 employees and more than €450 million turnover; VSME is the voluntary standard for smaller firms.
- BRSR and BRSR Core: SEBI's sustainability report for listed companies in India.
- UK SRS: the UK's sustainability reporting standards, finalised in February 2026 and voluntary for now.
See each one, with who it affects, on the regulations map.
Step 4Supplier ESG
As a supplier, you will mostly meet ESG through questionnaires: a customer's own form, a rating platform such as EcoVadis, or CDP's supply chain programme. The same figures come up again and again: energy use, Scope 1 and 2 emissions, policies and targets. Collect them once and keep them current.
If you are the one asking, collecting primary data from your own suppliers is how Scope 3 moves from estimates to measured figures. Read more on supplier engagement.
Step 5Data management
Good ESG data has an owner, a source and a method. Keep each figure next to the document it came from, use the same method each year, and lock the numbers once they are signed off, so they cannot drift after you report them.
- One place for the data, not a spreadsheet per person.
- A named owner for each site or data type.
- The bill or record attached to every figure.
- A record of which conversion factors were used, and when.
See how this works in ESG reporting with ESGen.
Where to start
If a request has already landed, work from it rather than from a framework.
- 1.Find the last ESG request a customer, buyer or lender sent you, and list what it asks for.
- 2.Gather twelve months of electricity, gas and fuel records for each site.
- 3.Work out Scope 1 and 2 with the published conversion factors for that year.
- 4.Keep the evidence with each figure.
- 5.Then decide which framework or questionnaire to answer first.
Not sure what a request is asking for?
Send it to contactus@esgen.co.uk and we will tell you what it needs and what you already have.
