Carbon accounting rises amid growing market transparency requirements

The growth of carbon markets is driving a need for carbon accounting to ensure financial transparency regarding costs, obligations, and risks. As climate disclosure regulations tighten, businesses must improve the measurement, control, and verification of emission data.

In the European Union, facilities under the EU Emissions Trading System (EU ETS) are required to monitor and report annual emissions. Additionally, the Carbon Border Adjustment Mechanism (CBAM) necessitates reporting emissions embedded in certain imported goods, requiring data at the product level.

Vietnam is also advancing its carbon market roadmap. Under Decision No. 232/QD-TTg, the country is establishing mechanisms for emission quotas and carbon trading. Furthermore, Decision No. 263/QD-TTg has set pilot greenhouse gas emission quotas for 2025 and 2026 for 110 facilities in the thermal power, steel, and cement industries. These developments transition greenhouse gas emissions from purely environmental concerns to critical components of corporate financial performance and reporting.