Governance & Finance: How and why we created this section

Working on Governance and Finance

We don’t have a favourite section, but for those council climate policy wonks, we think this section will be really interesting! This section is all about how a council is embedding climate action into all its activities. It also looks at the all important question of how they are raising funds for this action too. It might not be the shiniest section in terms of easy to see climate action, but it’s definitely one of the most important sections.

Measuring funding for climate action
So let’s start with how we could measure council funding for climate action. Well, it’s hard. Every council writes their budgets differently, and as councils don’t have any statutory powers around climate action, there is no easy way to see this work in a budget line. On top of that, councils have such varying budgets and demands for spending, depending on their levels of council tax, the government funding they receive and the demographic and needs of their residents. Therefore, we felt it would be unfair to score councils based on any actual amount of money councils have spent on climate action. This is because, for some councils, one million would be a considerable part of their budget, and for others that would be much smaller. Taking climate action will cost councils money. With the current government slashing local council budgets year on year, it’s clear that councils will need to raise funds from other revenues in order to fund climate action. For these reasons, this is why the questions around funding for councils ask about whether a council has raised funds in various ways, and why we don’t ask how much money councils have raised in these different ways.

We believe that our question on the percentage of staff working on climate action is a good way to gauge the extent to which a council is working on climate action or not, proportionally to their own staff team. We will be using an FOI request to answer this question because councils will easily know their total number of staff, but it is not information that is available publicly. We’ve scored this question as a % of overall staff in order to make this fair to councils that have very different staff numbers. We have been as descriptive as possible to let councils know what we are counting as staff who work on climate action, but this can never be foolproof. However, this question is still a good indication, amongst all the other questions we ask, of how seriously a council is putting capacity into climate action. When we publish the Scorecards, the FOI responses will also be published, so people will be able to see for themselves why councils did or did not score for this question.

Along with how a council raises money for climate action, how councils choose to invest their money has an impact on wider greenhouse gas emissions too. This is why we have included questions on council pension investments, as well as it being an international campaign that has had huge success in divesting funds from fossil fuel companies. We have also included a question on councils’ direct investments. This is because if a council is investing in high carbon infrastructure, such as an airport or an oil field, then at a larger scale they are effectively cancelling out their emission reduction actions as they are simultaneously supporting more carbon being put into the atmosphere.

Measuring policies or action
When we started writing this section, we realised we could risk going down the same route again of marking the strength of written plans, like transport and housing strategies. We decided against this, as we want to score actual action in these Scorecards. However, we did decide to score councils on whether their Corporate Plan and Mid-Term Financial Plans include a net-zero target and climate action as core priority. This is because this is a useful way to gauge whether climate action has been incorporated, at least on paper to start with, into the wider operations of the council.

We have included another question on policies, on whether a council has a climate risk register, because it is important for councils to start adapting to climate change as well as mitigating against it because the climate crisis is already upon us. We don’t just want to see an adaptation plan, but evidence of a council understanding the environmental risks within their area and how they plan to mitigate and adapt to them, through a risk register that they use in making decisions.

Procurement powers
Councils have an opportunity to impact their own emissions and create changes within their supply chains through sustainable procurement actions. We have one quite detailed question on procurement to ensure that councils are embedding climate action into what they buy. Despite this being a question on what is in a procurement policy, rather than measuring actual action, procurement policies are active documents that are used regularly. This is one of the easiest ways for us to measure sustainable procurement, rather than looking at the actual procurement and tendering of all councils which would be extremely detailed and difficult.

Measuring actual emissions
And, of course, we have to score councils on actual greenhouse gas emissions somewhere. As there is no universal way for councils to measure their own emissions, we split these questions out in order that the percentage emission reduction that we score is somewhat comparative. We want to ask all councils to report on scope 3 emissions as default. However we recognise that reporting on scope 3 emissions is considerably harder and we wanted to ensure that we did recognise emission reductions from council operations, even if from only scope 1 and 2 emissions, and is only a very small part of overall area-wide emissions.

For measuring area-wide emissions, BEIS data uses the best available data, compiled from UK and international research for each emission source, and it is widely recognised and used as a way of measuring UK emissions. Equally, we know that this also has its imperfections: it is only a detailed estimate of emissions; the results come out 2 years after the date it is reporting on; and it reports on territorial emissions only, excluding flights and the emissions from imported goods. Despite this, we have included a question on the percentage emission reduction using BEIS data, on emissions within the scope of local authorities. Whilst we recognise that local authorities are not the only actor that can influence these emissions, we also know that they can have a real influence. Our Scorecard’s ultimate aim, and that of councils, is to support a reduction in greenhouse gas emissions across UK local authorities, so we must look at this data as one of the barometers of whether this aim is being met.

Council climate governance
The remaining questions in this section are about council governance processes. Understanding if a council has incorporated climate change into its decisions making is something that is hard to measure, though the question we have on this does measure this from a process perspective. If a council has embedded taking climate change impact into its’ decision making, then in theory this council should score well in other questions, as, for example, they would be less likely to be investing in fossil fuels, approving new major roads and airports, and more likely to raise funds for climate action.

We decided to focus the carbon literacy training question on whether senior management and leading councillors have received this training. This was partly to keep the number of questions in this section manageable, as we could have asked about how many of the council’s total staff and councillors have received this training. This decision was also made because we know that training all staff in carbon literacy can be too expensive for some councils. In order to embed climate action throughout a council, those in the highest decision making roles should be the ones trained first so this behaviour change can flow down into all other areas of the council.

In Conclusion
Given the great diversity of council structures and funding situations, this section has done its best to create a set of actions that all councils can be taking to embed climate action throughout their work. Not all of these actions require extensive funding, so we hope that many councils will work hard to implement many of these actions, if they haven’t done so already.