Disclosure focus
This disclosure asks an organisation to explain whether it uses an internal carbon price in decision-making, and if so, how that price is applied in practice. The focus is on the organisation’s own approach: what the price is used for, how it influences planning or investment choices, and whether it is a formal part of internal processes rather than an informal estimate.
In practical terms, the key question is how broadly the carbon price is used across the business. Reporting should make clear whether it applies only to selected projects, business units or flagship sites, or whether it is embedded across operations and capital allocation more widely. The aim is to show the extent of coverage and how consistently the price is used in real decisions.
This LRA educational guidance supports disclosure preparation. For the exact requirements, always refer to the official IFRS source.
Before you start
A quick mental checklist before you prepare this disclosure — tick each as you settle it.
Preparation
Key datapoints to prepare
＋ Show s2-29-f sub-elements (LRA working checklist)
Set out the ways the carbon price is used in the business, such as for planning, appraisal or risk work.
Explain what parts of the organisation and which assumptions are included in the coverage, so readers can see the scope.
State which choices or actions are shaped by the carbon price information.
Give the price level or levels applied, and make clear how they are used.
Clarify whether the figure is only a notional benchmark or whether it is also used as an internal charge or levy.
How to prepare it
1Set the boundary for the carbon-price use cases you will report on. Be clear about which business areas, projects, or decisions are in scope, and keep that scope consistent with the evidence you can support.
2Define what each price input means in your organisation. Separate the price levels you actually used from any internal charge, levy, or notional rate, so the reader can see how the figures were applied.
3Gather the source material that shows how the price was used in practice. This should include the records behind the use case, the assumptions made, and the decision-making papers or approvals that were influenced.
4Compile the disclosure content in a way that links the use case, the price level(s), and the decisions affected. If the information is narrative rather than numeric, make sure the explanation still shows the same underlying facts.
5Record any limits, exclusions, or changes in method, coverage, or assumptions. Explain what was left out, what changed from prior reporting, and why those choices were made.
6Check the draft against the official source before finalising it. Confirm that the reported coverage, assumptions, price levels, and evidence all match the underlying records and that the distinction between a shadow price and an internal fee or tax is clear.
Request the data
Request the internal carbon price details
Translate the disclosure into an internal business question — then adapt it to your organisation's own language.
How do we use an internal carbon price in planning and decision-making, and what evidence shows the price levels, scope, assumptions, and the choices it has influenced?
Use your organisation’s own terms first, then map them to the disclosure. For example, if your team talks about a carbon charge, planning price, or emissions cost assumption, use that language in the request and only translate it afterwards for reporting. This is a possible LRA training template; adapt it to your organisation and check the official source before sign-off.
Weak request
Please provide the internal carbon pricing disclosure and all mandatory evidence for the standard.
Why it fails: It uses framework language instead of the organisation’s own terms, does not tell the owner what practical information is needed, and does not separate the price level, scope, assumptions, and decision use into clear items that can be evidenced.
Better request
Please send the carbon cost assumption or internal charge used in [business area] for [reporting period], including the level(s), where it is applied, how it was set, and the decisions it has influenced. Use your team’s own wording and attach the workbook, policy note, or approval paper that shows how it is used.
Industry examples
Draft your disclosure
Notes that turn data into a disclosure
LRA training templates — adapt them to your organisation, and check the official source before sign-off.
Method note
Explain what you mean by each carbon-price measure, how you set the coverage boundary, and the assumptions used to apply the price in practice.
Context note
Set out how the carbon-price approach is used in the business and what the reported figures indicate about decision-making, planning, or cost signals.
Fluctuation statement
If the price level, coverage, or the decisions affected changed during the period, describe what changed and the business reason for the shift.
Content index entry
s2-29-f Internal carbon prices — [location / page] / [notes]
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Preparation tools & forms
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Assurance readiness
For each claim, check the evidence
Evidence pack to prepare
Common reporting gaps
The information is presented without a date or as-at point.The scope or boundary of the statement is left undefined.Key terms are used inconsistently across the report.Material changes since the previous period are not disclosed.Assertions are made without supporting detail or a source record.Boilerplate is used that does not actually answer what is asked.
Common gaps
Mistakes to avoid when collecting the data
Wrong owner
The request goes to the sustainability team instead of the finance, strategy, or project lead who actually holds the pricing records.
Framework language first
People ask for the data using disclosure labels rather than the business terms the team uses for carbon pricing in day-to-day work.
No boundary set
The collection starts without agreeing which business units, projects, or decision processes are in scope, so the dataset is incomplete or over-wide.
Wrong time basis
The team pulls figures from a different reporting period or decision date than the one used when the price was applied.
Mixed counting basis
Shadow pricing and any internal charge or levy are blended together even though they are tracked and used for different purposes.
Source labels lost
The original file names, system tags, or spreadsheet headings are stripped away, making it hard to trace where each price figure came from.
Separate groups merged
Different use cases, price levels, or decision types are combined into one pool even though they should be kept apart for reporting.
Evidence trail missing
The collector saves the numbers but not the supporting notes, assumptions, or approval record needed to show how the figures were assembled.
No sign-off record
The final pack is circulated without a named reviewer or approval trail, so nobody can show who checked the data before it moved on.
Where judgement is often needed
What sits inside the reporting boundary after a buy-in or sale
Set a clear cut-off for newly acquired or disposed operations, explain whether you use opening, closing, or average coverage for the period, and note any parts of the business left out because the boundary changed.
Different country teams using different price labels
If local units use different names or methods for the same carbon cost signal, map them to one group-wide description, explain the differences, and show how you kept the comparison consistent across locations.
Units close to the edge of scope
Decide whether small entities, joint arrangements, or newly formed activities are included in the price-use analysis, and disclose the rule used for borderline cases so readers can see why some items were in or out.
Choosing the timing basis for the price level
State whether the price shown is taken at the date of decision, the reporting date, or another point in time, and explain any averaging or updating approach used across the period.
Using estimates where direct records are incomplete
Where the price signal is not fully captured in system records, say which figures are estimated, what source data supported them, and how you distinguished estimates from measured amounts.
Rounding and presentation of price levels
Explain the rounding rule used for the price figures, keep it consistent across the disclosure, and make sure the rounded numbers still align with the underlying totals and decisions described.
Aggregating sensitive detail for privacy or commercial reasons
If you combine or blur site-level or team-level information to protect confidentiality, say what has been grouped, why the aggregation was needed, and how the summary still reflects the decisions influenced.
Linking the price signal to the decisions it shaped
For each price level or price type, identify the business choices it affected, and if more than one decision was influenced, explain the basis for linking the same price signal to each one.
Separating a shadow price from an internal charge or levy
If you use both a notional carbon value and an actual internal charge, describe each one separately, explain how they differ in purpose and use, and avoid combining them in a way that hides the method.
Examples
Illustrative examples
Synthetic, written by LRA — not from a company report, not text from any standard.
Illustrative (synthetic) example — Manufacturing
*Illustrative only: our group uses an internal carbon charge to steer capital spending and operating choices.* We apply a shadow carbon price of **£85 per tonne of CO2e** to **100%** of new project appraisals, while a separate internal levy of **£40 per tonne of CO2e** is used for **60%** of business-unit budgets; the levy covers **12 of 20** units, and **6 of those 12** also use the shadow price in local planning. The price signals have influenced **14 investment decisions** this year, including **9 equipment upgrades**, **3 logistics changes** and **2 product-design changes**; the remaining **6 decisions** were informed by the same pricing approach but did not change the final option selected.
This synthetic example shows how a reporter can explain where carbon pricing is used, what level is applied, how much of the business it reaches, and which choices it has affected, while distinguishing a planning price from an internal charge.
Illustrative (synthetic) example — Retail
*Illustrative only: our company uses carbon pricing in procurement and store operations to shape day-to-day decisions.* We apply a shadow price of **£70 per tonne of CO2e** to **80%** of supplier tenders and a separate internal fee of **£25 per tonne of CO2e** to **100%** of store energy plans; the shadow price covers **16 of 20** tenders, and the fee covers **240 of 240** stores. During the year, the pricing approach affected **11 decisions** in total: **7 supplier selections**, **2 refrigeration replacements** and **2 store-opening plans**.
This synthetic example demonstrates a second plausible pattern: one price used for external sourcing decisions and another for operational planning, with clear coverage and a short list of decisions that were changed or shaped by the pricing signal.
How companies report S2-29-f in practice
Real reports where this topic is disclosed. These are report practice, not exact disclosure templates to copy.
Woori Financial Group Inc.
Banks / Diverse Financials / Insurance · South Korea · 2024
Woori Financial Group’s 2024 Sustainability Report provides evidence of using an internal carbon price (ICP), describing the calculation as setting a price per unit of carbon emissions on page 42. The report includes references to carbon-related assets and financed emissions targets on page 39, indicating some integration of carbon pricing into financial considerations. However, the report lacks information on the coverage and assumptions behind the ICP, the specific decisions influenced by it, any narrative explanation, and distinctions between shadow price versus internal fee or tax, as no evidence was found for these aspects.
Hang Lung Properties Limited
Real Estate · Hong Kong · 2025
Hang Lung Properties Limited’s Sustainability Report 2025 includes a covered disclosure of its internal carbon pricing mechanism, describing the use of a shadow price to inform decision-making and promote energy efficiency on page 55. The report also references the potential impact of carbon pricing in relation to energy efficiency plans on page 150, though this is less clearly detailed. However, the report lacks clear disclosures on the coverage and assumptions behind the carbon price, specific decisions influenced by it, and broader narrative context, as no quotable evidence was found for these datapoints.
Taiwan Cooperative Financial Holding Co., Ltd.
Banks / Diverse Financials / Insurance · Taiwan · 2024
Taiwan Cooperative Financial Holding Co., Ltd.’s 2024 ESG Report includes evidence of using an internal carbon pricing mechanism to guide carbon investments, identify low-carbon opportunities, and influence strategy and financial planning (p.162). However, the report does not provide clear information on the coverage and assumptions behind the carbon pricing, nor does it specify which decisions are influenced by this mechanism. Additionally, while related context is present, the distinction between a shadow price and an internal fee or tax is not clearly disclosed (p.162).
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Scenarios to work through
A group finance team uses a notional carbon price in project appraisal for two business units, but one smaller unit still relies on a separate internal charge for emissions. The reporting pack also shows that the price is applied only to capital projects above a set threshold.
QHow should the preparer describe the different ways the organisation uses carbon pricing, without blending the notional price and the internal charge into one label?
Reveal model answer →Hide answer ↑They should separate the use cases clearly: explain where a notional price is used, where an internal charge or levy is used, and avoid treating them as the same mechanism if they serve different purposes. The description should be adapted to the organisation’s own setup and checked against the source before sign-off.
Why this matters · Describe each carbon-pricing tool by its actual role, not by a single catch-all label.
An energy company applies a carbon assumption only to new investment cases in one division, while the rest of the group uses no carbon price at all. The draft note says the price is used across the whole business, which is not accurate.
QWhat should the preparer do when explaining coverage and the assumptions behind the price use?
Reveal model answer →Hide answer ↑They should state the parts of the business, activities, or decision processes that are covered, and make clear any areas that are excluded. They should also set out the assumptions used to apply the price, in language tailored to the organisation and reviewed against the source before sign-off.
Why this matters · Be precise about where the price is used and what assumptions sit behind that use.
A manufacturer uses a carbon price in capital allocation, procurement screening, and product design choices. The draft disclosure mentions the price level but leaves out the decisions it actually shaped, even though the investment committee relied on it in several cases.
QWhich decisions should the preparer connect to the carbon price in the narrative?
Reveal model answer →Hide answer ↑They should identify the decisions that were influenced by the carbon price, such as investment choices, sourcing decisions, or design changes, where that is true in the organisation. The point is to show the practical effect of the price, using wording adapted to the organisation and checked against the source before sign-off.
Why this matters · Link the carbon price to the real decisions it affected, not just to its existence.
A utility group uses two different carbon values: one is a planning assumption for long-term projects, and the other is an internal levy collected from operating units. The draft note lists both numbers but does not explain which is a planning value and which is a charge passed through the business.
QHow should the preparer distinguish between a planning-based carbon value and an internal charge or tax-like mechanism?
Reveal model answer →Hide answer ↑They should explain which value is a planning or valuation input and which one functions as an internal fee, levy, or tax-style charge. If more than one level is used, each should be identified in context, with the wording adapted to the organisation and checked against the source before sign-off.
Why this matters · Separate a planning price from a charge that moves money inside the business.
Framework references
Related framework references
How this disclosure maps across the major reporting frameworks.
Primary
Related & explore
FAQ
Questions this page answers
How do I prepare disclosure s2-29-f in practice using the page’s step-by-step guidance?+−
Start with the plain-language explainer, then work through the page’s step-by-step preparation section and the listed datapoints: carbon price uses, scope and assumptions, affected decisions, price level, and internal charge method. The page is designed to help you turn those inputs into a draft disclosure and an evidence pack.
What data do I need to collect for s2-29-f before I can draft the disclosure?+−
The page says to prepare five datapoints: carbon price uses, scope and assumptions, affected decisions, price level, and internal charge method. Use those as your minimum data checklist before drafting.
Who should own the data for s2-29-f in my organisation?+−
The page is aimed at sustainability/ESG managers, HR or data owners, and assurance reviewers, so ownership should sit with the person who can explain the data, the method, and the evidence behind it. The workbook and evidence-pack sections are there to help you assign and document that ownership.
What should I include in the evidence pack for s2-29-f to make it assurance-ready?+−
The page includes an evidence pack with five items for assurance readiness, alongside five assurance claims to verify. Use those materials together so you can show the claim, the risk, and the supporting evidence in a clear trail.
What are the five assurance claims I need to check for s2-29-f?+−
The page says there are five assurance claims to verify, each linked to a claim, risk, and evidence view. Use that section to test whether your draft is supported and whether the evidence pack is complete.
What are the common mistakes people make when reporting s2-29-f?+−
The page lists common reporting gaps and mistakes, so it is useful as a pre-submission check. Review those gaps against your draft to catch missing scope, weak assumptions, or unsupported statements before sign-off.
How do I use the Prep & Assurance workbook for s2-29-f?+−
The Download Centre includes a Prep & Assurance workbook in .xlsx format, which is meant to support preparation and assurance readiness. Use it to organise the datapoints, evidence, and draft content before you finalise the disclosure.
What can I do with the printable Library Card PDF for s2-29-f?+−
The Download Centre also includes a printable Library Card in .pdf format. It is a practical companion for working through the page’s guidance, especially if you want a quick reference while preparing the disclosure.
Can I use the synthetic example on the s2-29-f page as a template for my own draft?+−
Yes, the page includes synthetic illustrative example disclosures, including a quantitative table, which can help you see how the disclosure might look in practice. Treat it as a drafting aid only and make sure your own figures, scope, and wording match your organisation’s data.
How do I turn the s2-29-f data into a draft disclosure narrative?+−
The page has a draft-output section with visualisation ideas, narrative starters, and a content-index line. Use those to convert the prepared datapoints into a clear draft and then check it against the evidence pack.
Is the s2-29-f page useful if I need to align data across ESRS E1 and IFRS S2?+−
The page notes ESRS E1 (Climate Change) as the closest ESRS correspondence, so it can help you think about reuse of data across frameworks. It does not say the requirements are identical, so use it as a practical cross-check rather than a one-to-one mapping.
More questions this page can help with
s2-29-f carbon price uses what data should I gather firsts2-29-f scope and assumptions how do I document them for assurances2-29-f affected decisions what evidence should support the narratives2-29-f price level how should I present it in a draft disclosures2-29-f internal charge method what should the workbook captures2-29-f evidence pack checklist for assurance readinesss2-29-f common reporting gaps and mistakes to avoids2-29-f synthetic example disclosure table how to use its2-29-f draft output narrative starters and content index lines2-29-f download centre workbook pdf how to use thems2-29-f from company reports examples where the topic is discloseds2-29-f ESRS E1 climate change data reuse for reporting
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