Sustainability reporting has an unusually dense vocabulary, and most of it is defined nowhere a first-time filer will look. This is that place — grouped by where you will encounter each term.
The vocabulary of counting greenhouse gases.
A gas that traps heat in the atmosphere. The main ones in corporate reporting are carbon dioxide, methane, nitrous oxide and several fluorinated gases used in refrigeration and electrical equipment.
A common unit that lets different gases be added together. Each gas is converted into the amount of carbon dioxide that would cause the same warming over a chosen period, using a global warming potential.
How much heat a gas traps relative to carbon dioxide over a given horizon, usually 100 years. Methane’s is many times higher than CO₂ over that period and higher still over 20 years. Values are published by the IPCC and differ between assessment reports — you must state which you used.
Direct emissions from sources your company owns or controls: generators, boilers, furnaces, company vehicles, refrigerant leaks and process emissions.
Emissions from energy you purchase — principally electricity. You do not emit them; your demand caused them.
Everything else your business causes across its value chain, divided into fifteen categories. Usually the largest part of a footprint and always the hardest to collect.
The record of what actually happened: kilowatt-hours drawn, litres burned, kilometres driven, tonnes purchased. The raw material of every calculation.
The conversion rate from an activity to a quantity of gas — kilograms of CO₂e per kilowatt-hour, per litre, per kilometre. The single most consequential input in a disclosure.
Calculating Scope 2 using an average emission factor for the grid you draw from. This is what IFRS S2 requires.
Calculating Scope 2 using the emissions profile of electricity you have contracted for specifically. Disclosed in addition to the location-based figure where relevant, never instead of it.
Released by a chemical reaction rather than by combustion — calcination in cement production being the classic case. Frequently exceeds fuel emissions in heavy industry and is the most commonly omitted Scope 1 source.
Unintentional releases: refrigerant leakage, methane from gas infrastructure, sulphur hexafluoride from switchgear. Small volumes, occasionally large CO₂e figures.
Emissions per unit of something — per tonne of product, per million naira of revenue, per subscriber. Shows whether you are becoming more efficient, where an absolute figure only shows whether you grew.
The measured starting point against which reductions and targets are assessed. A target measured from a baseline nobody can test is discounted, sometimes to nothing.
Who writes the rules, and what each document is for.
The Greenhouse Gas Protocol Corporate Standard — the accounting standard that defines the scopes and how to calculate them. Every reporting framework assumes it.
The International Sustainability Standards Board, created by the IFRS Foundation to consolidate a fragmented landscape of voluntary frameworks into one set of standards for investors.
The ISSB’s general standard: how to report sustainability-related financial information, what counts as material, and where the information sits relative to the financial statements.
The ISSB’s climate standard, incorporating the TCFD recommendations in full. This is where greenhouse gas emissions and climate resilience requirements live.
The Task Force on Climate-related Financial Disclosures. Gave the world the four-pillar structure in 2017; its recommendations were absorbed into IFRS S2 and the Task Force was disbanded in 2023.
The Global Reporting Initiative. Asks how your organisation affects the world rather than how the world affects your enterprise value — a different question for a wider audience, and still widely used.
Industry-specific disclosure standards, now maintained by the ISSB and referenced in IFRS S1 as a source for industry metrics.
The EU’s Corporate Sustainability Reporting Directive and the European Sustainability Reporting Standards under it. Reaches Nigerian companies through EU parents and large EU customers rather than through Nigerian law.
The Partnership for Carbon Accounting Financials, whose standard is the accepted method for financed emissions — the emissions of what a bank lends to and invests in.
Governance, strategy, risk management, and metrics and targets. Every requirement in IFRS S1 and S2 sits under one of them, which is why learning them once makes every framework legible.
Who is required to do what, and by whom.
The Financial Reporting Council of Nigeria — the standard setter that brought IFRS into Nigerian financial reporting and has adopted the ISSB standards for sustainability.
The Securities and Exchange Commission, which regulates the Nigerian capital market and whose sustainability disclosure requirement reaches listed companies first.
Nigerian Exchange Group, the exchange on which Nigerian listed companies trade. Has published its own sustainability disclosure guidelines that many issuers already report against.
A company whose failure or misreporting would affect a group wider than its shareholders — typically banks, insurers, pension operators, public sector entities and large unlisted companies. Wider than listing status alone.
Which legal entities, sites and operations are inside your disclosure. Fixed by your consolidation approach and the single most consequential early decision.
How you decide what is inside the boundary: operational control, financial control or equity share. All three are permitted; you pick one and apply it everywhere.
The ISSB test: information is material if omitting or misstating it could reasonably be expected to influence investors’ decisions. Narrower than GRI’s impact materiality.
The CSRD test, combining financial materiality with impact materiality. Relevant to Nigerian companies only through EU relationships.
The EU’s Carbon Border Adjustment Mechanism. Places an obligation on EU importers of certain carbon-intensive goods, which they pass to their suppliers — including Nigerian exporters.
The EU Deforestation Regulation. Requires importers of cocoa, rubber, palm, timber, coffee, soya and cattle products to prove the land was not deforested after 31 December 2020.
Nigeria’s framework climate legislation, establishing the National Council on Climate Change and a carbon budget mechanism.
Nationally Determined Contribution — a country’s pledged emissions commitment under the Paris Agreement. Shapes national policy rather than imposing direct corporate obligations.
The vocabulary of proving that a figure is what you say it is.
The provider performs enough work to state that nothing has come to their attention suggesting the disclosure is materially misstated. A lower bar than a financial audit, and the usual starting point for sustainability.
A higher level, closer to a financial audit, where the provider expresses a positive opinion. Expensive, and increasingly the direction of travel for greenhouse gas figures.
The statement of which standard, boundary, factors, methods and judgements produced the figures. The section an assurance provider reads first, and the one most often missing.
The chain from a reported total down to the document it originated in. In practice: total, to components, to activity data, to the bill or log.
Changing a previously published figure. Requires disclosure of what changed and why. Only possible if you recorded which factor and version produced the original.
The degree to which a figure depends on judgement rather than measurement. Required to be disclosed where material, and disclosing it well is a sign of a mature reporter rather than a weak one.
Used in financed emissions under PCAF: a 1 to 5 scale from verified borrower-reported data down to sector-average estimates. Disclosed alongside the figure; the trajectory matters more than the starting point.
Where reporting meets capital.
A bond whose proceeds fund specified eligible projects, with use-of-proceeds tracking and reporting for the life of the instrument.
A facility whose margin steps up or down against entity-level performance targets. Prices against a baseline, which is why baseline quality decides the terms.
An independent review of a green bond framework, effectively expected by the market before issuance.
Development finance institution — a major source of long-tenor capital for Nigerian companies, applying its own environmental and social performance standards on top of anything a commercial lender requires.
The environmental and social standards most development finance institutions align to, covering labour, pollution, community safety, land, biodiversity and cultural heritage as well as climate.
How a company intends to move its business model toward lower emissions, with costed actions and timing. A target without one is treated as aspiration.
An instrument representing an emissions reduction or removal elsewhere. Disclosed separately from your gross figures, never netted off them.
Production moving to a jurisdiction with a lower carbon cost, so total emissions do not fall. The problem CBAM exists to address.
Claiming environmental performance you cannot evidence. Increasingly a regulatory and litigation risk rather than only a reputational one, which is why a stated basis of preparation matters.
Tell us and we will add it. This glossary exists because these terms are defined nowhere a first-time filer would look, and gaps in it are worth knowing about.
Four questions, and you get the year you first file, the framework, and what to collect first.
Plain-language explainers of the FRC and SEC rules, ISSB S1 & S2, and what each asks you to disclose.
What a consultant-led reporting cycle costs against an annual licence, in Naira.
