ifrs-s2-ibg-volume-33-engineering-and-construction-services-part-b

Title: Volume 33—Engineering & Construction Services

Category: Part B—Industry-based Guidance for IFRS S2

Source: IFRS Foundation (https://www.ifrs.org)

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Year: 2023

Type: Industry

Industry-based Guidance on implementing

Climate-related Disclosures

Volume 33—Engineering & Construction Services

June 2023

IFRS S2

IFRS

® Sustainability Disclosure Standard

International Sustainability Standards Board

This Industry-based Guidance accompanies IFRS S2 Climate related Disclosures (published

June 2023; see separate booklet) and is issued by the International Sustainability

Standards Board (ISSB).

Disclaimer: To the extent permitted by applicable law, the ISSB and the IFRS Foundation

(Foundation) expressly disclaim all liability howsoever arising from this publication or

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any claims or losses of any nature including direct, indirect, incidental or consequential

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Information contained in this publication does not constitute advice and should not be

substituted for the services of an appropriately qualified professional.

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corporate disclosure.

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IFRS S2 CLIMATE-RELATED DISCLOSURES–JUNE 2023

Introduction

This volume is part of the Industry-based Guidance on Implementing IFRS S2 Climate-related

Disclosures. This guidance suggests possible ways to apply some of the disclosure requirements in

IFRS S2 but does not create additional requirements.

This volume suggests possible ways to identify, measure and disclose information about

climate-related risks and opportunities that are associated with particular business

models, economic activities and other common features that characterise participation in

this industry.

This industry-based guidance has been derived from Sustainability Accounting Standards

Board (SASB) Standards, which are maintained by the International Sustainability

Standards Board (ISSB). The metric codes used in SASB Standards have been included for

ease of reference. For additional context regarding the industry-based guidance contained

in this volume, including structure and terminology, application and illustrative

examples, refer to Section III of the Accompanying Guidance to IFRS S2.

IFRS S2 INDUSTRY-BASED GUIDANCE

Volume 33—Engineering & Construction Services

Industry Description

The Engineering & Construction Services industry provides engineering, construction,

design, consulting, contracting and other related services that support various building

and infrastructure projects. The industry has four major segments: engineering services,

infrastructure construction, non-residential building construction, and building

subcontractors and construction-related professional services. The infrastructure

construction segment includes entities that design or build infrastructure projects such

as power plants, dams, oil and gas pipelines, refineries, highways, bridges, tunnels,

railways, ports, airports, waste treatment plants, water networks and stadiums. The non-

residential building construction segment includes entities that design or build industrial

and commercial facilities such as factories, warehouses, data centres, offices, hotels,

hospitals, universities and retail spaces such as shopping centres. The engineering

services segment includes entities that provide specialised architectural and engineering

services such as design and development of feasibility studies for many of the project

types listed above. Finally, the building subcontractors and other construction-related

professional services segment includes smaller entities that provide ancillary services

such as carpentry, electrical, plumbing, painting, waterproofing, landscaping, interior

design and building inspection. The industry’s customers include infrastructure owners

and developers in the public and private sectors. Large entities in this industry operate

and generate revenue globally and typically operate in more than one segment.

Sustainability Disclosure Topics & Metrics

Table 1. Sustainability Disclosure Topics & Metrics

TOPIC

METRIC

CATEGORY

UNIT OF

MEASURE

CODE

Number of active projects 37

Quantitative

Number

IF-EN-000.A

Number of commissioned projects 38

Quantitative

Number

IF-EN-000.B

Total backlog 39

Quantitative

Presentation

currency

IF-EN-000.C

Environmental Impacts of Project Development

Topic Summary

Presentation

currency

IF-EN-000.C

Environmental Impacts of Project Development

Topic Summary

Infrastructure construction projects improve economic and social development; however,

they also may pose risks to the local environment and surrounding communities.

Industry activities can disrupt local ecosystems through biodiversity impacts, air

emissions, water discharges, natural resource consumption, waste generation and

hazardous chemicals use. Construction entities perform clearing, grading and excavation

Note to IF-EN-000.A – Active projects are defined as buildings and infrastructure projects under

development that the entity was actively providing services to as of the close of the reporting

period, including, but not limited to, both the design and construction stages. Active projects

exclude projects that were commissioned during the reporting period.

Note to IF-EN-000.B – Commissioned projects are defined as projects that were completed and

deemed ready for service during the reporting period. The scope of commissioned projects shall

only include projects that the entity provided construction services to.

Note to IF-EN-000.C – Backlog is defined as the value of projects not completed as of the close of

the reporting period (i.e., revenue contractually expected in the future but that has not been

recognised), or is defined by the entity, consistent with its existing disclosure of backlog.

Backlog may also be referred to as revenue backlog or unsatisfied performance obligations. The

scope of disclosure is limited to buildings and infrastructure projects where the entity provides

engineering, construction, architecture, design, installation, planning, consulting, repair, and/or

maintenance services, or other similar services.

IFRS S2 INDUSTRY-BASED GUIDANCE

activities and may generate harmful waste during project construction. Effectively

assessing environmental impacts before construction may mitigate unforeseen issues

that may increase operational expenses and capital costs. In some cases, environmental

concerns or local community pushback may result in project delays and, in extreme

cases, project cancellations, which may affect an entity’s profitability and growth

opportunities. Failure to comply with environmental regulations during construction

may result in costly fines and remediation costs, and it can damage an entity’s

reputation. Environmental impact assessments can provide an understanding of a

project’s potential environmental impacts and necessary mitigation activities before it

begins. Likewise, proper management of environmental risks during project construction

may reduce regulatory oversight or community pushback. By assessing environmental

considerations before project initiation, as well as continuing to evaluate them during

project development, engineering and construction entities may be prepared to mitigate

potential environmental issues and the associated financial risks that may occur, while

also establishing a competitive advantage for obtaining new contracts with prospective

clients.

Metrics

IF-EN-160a.1. Number of incidents of non-compliance with environmental permits,

standards and regulations

The entity shall disclose the total number of incidents of non-compliance

associated with the environment, including violations of permits, standards or

regulations associated with waste, air quality or emissions, water discharges,

water withdrawal exceedances, effluent limit exceedances (such as waste load

allocation), violation of wastewater pre-treatment requirements, oil or hazardous

substance spills, land use, and endangered species.

The scope of disclosure includes incidents governed by applicable jurisdictional

statutory permits and regulations.

The scope of disclosure includes incidents of non-compliance received by the

entity and by subcontractors under the entity’s direct supervision.

An incident of non-compliance shall be disclosed regardless of whether it resulted

in an enforcement action (for example, fine or warning letter).

An incident of non-compliance, regardless of the measurement method or

frequency, shall be disclosed. These include one-time violations, continuous

discharges and non-continuous discharges.

IF-EN-160a.2. Discussion of processes to assess and manage environmental

risks associated with project design, siting and construction

The entity shall discuss the processes employed to assess and manage the

environmental risks associated with project siting, design and construction.

1.1

Environmental risks may include ecological impacts, biodiversity impacts,

emissions to air, discharges to water, slope disturbance, soil disturbance

and erosion, storm water management, waste management, natural

resource consumption and hazardous chemical usage.

IFRS S2 CLIMATE-RELATED DISCLOSURES–JUNE 2023

The entity shall discuss the due diligence practices employed to assess project

environmental risks in which relevant due diligence practices include

environmental impact assessments and stakeholder engagement practices.

2.1

Relevant items to discuss include: practices to assess the baseline

environmental considerations of the project site; feasible, environmentally

preferable alternatives for the project; local legal requirements;

biodiversity protection; renewable natural resources use; hazardous

substances use; and efficient energy production, delivery and use.

The entity shall discuss the operational practices employed to minimise

environmental impacts during project siting, design and construction, which may

include: waste management, reducing biodiversity impacts, emissions to air,

discharges to water, natural resource consumption and hazardous chemical use.

The entity shall describe how it operates in compliance with all applicable

environmental regulations and permits.

4.1

Relevant items to include: employee training on relevant regulations and

clean up procedures, quality control processes on project sites, internal

mechanisms for reporting and following up on environmental incidents,

and maintenance and reporting of accurate data.

The entity shall discuss the use of codes, guidelines and standards to assess and

minimise environmental impacts of project siting, design and construction, when

applicable. Relevant codes, guidelines and standards may include:

5.1

BREEAM®

5.2

The Equator Principles

5.3

International

Finance

Corporation’s

Environmental

and

Social

Performance Standards and Guidance Notes

5.4

Finance

Corporation’s

Environmental

and

Social

Performance Standards and Guidance Notes

5.4

Institute for Sustainable Infrastructure’s (ISI) Envision® rating system

5.5

International Organization for Standardisation (ISO) environmental

standards

5.6

United Nations Development Programme’s Performance Standards on

Environmental and Social Sustainability

5.7

United Nations Global Compact’s Environmental Principles

5.8

U.S. Green Building Council’s LEED® certification

5.8

U.S. Green Building Council’s LEED® certification

The entity shall describe how it manages projects that have increased

environmental or social due diligence requirements or are expected to have

significant adverse environmental or social impacts, including additional

measures or policies it employs.

6.1

An example of a project type that has increased environmental or social

impacts are ‘Category A’ projects categorised by the International Finance

Corporation (IFC).

impacts are ‘Category A’ projects categorised by the International Finance

Corporation (IFC).

IFRS S2 INDUSTRY-BASED GUIDANCE

6.2

The entity may describe how it categorises the environmental risk severity

of its projects, including how it determines if a project has increased

environmental risk.

When applicable and relevant, the entity shall describe differences between

policies and practices for its various operating regions, project types and business

segments.

The scope of disclosure includes project stages associated with siting, design and

segments.

The scope of disclosure includes project stages associated with siting, design and

construction with which the entity is involved through contractual responsibility,

which may include feasibility studies, proposals, design and planning,

subcontractor procurement, and construction.

Structural Integrity & Safety

Topic Summary

Whether

providing

engineering,

design,

architectural,

consulting,

inspection,

construction or maintenance services, entities in this industry have a professional

inspection,

construction or maintenance services, entities in this industry have a professional

responsibility to ensure the safety and integrity of their work. Errors or inadequate

quality in the project design phase and construction of buildings or infrastructure may

result in significant personal injury, loss of property value and economic harm. Entities

that manage structural integrity and safety poorly may incur incremental costs because

of redesign or repair work and legal liabilities, as well as reputational damage that could

hurt growth prospects. Moreover, when designing and constructing buildings or

infrastructure, entities in the industry increasingly must contemplate potential climate

change impacts, which may affect the project’s structural integrity and public safety.

Compliance with minimum applicable codes and standards may not be enough to

maintain and grow reputational value (or even mitigate legal liabilities) in some

circumstances, especially if the frequency and severity of climate-change-related events

increases as expected. Meeting or exceeding new industry quality standards, and setting

up internal control procedures to identify and fix potential design issues, including those

resulting from climate risks, are practices that may help entities reduce these risks.

Metrics

IF-EN-250a.1 Amount of defect- and safety-related rework costs

The entity shall disclose the total amount of defect- and safety-related rework

costs incurred.

1.1

The entity shall disclose the total amount of defect- and safety-related rework

costs incurred.

1.1

Rework is defined as activities in the field that must be done more than

once, or activities that remove work previously installed as part of the

project.

1.2

For the purposes of this disclosure, the scope of rework costs excludes

costs resulting from client- or project-owner-driven modifications

including change orders, revisions to scope or revisions to design.

1.3

including change orders, revisions to scope or revisions to design.

1.3

The scope of rework costs includes costs associated with labour, materials,

design, equipment and subcontractors.

The entity may discuss projects with significant rework costs relative to actual or

projected total project costs. Relevant context to provide may include:

IFRS S2 CLIMATE-RELATED DISCLOSURES–JUNE 2023

2.1

Root causes of rework

2.2

Corrective actions implemented

2.3

Financial impacts to entity

IF-EN-250a.2. Total amount of monetary losses as a result of legal proceedings

associated with defect- and safety-related incidents

The entity shall disclose the total amount of monetary losses incurred during the

reporting period resulting from legal proceedings associated with defect- and

safety-related incidents and allegations.

The legal proceedings shall include any adjudicative proceeding involving the

entity, whether before a court, a regulator, an arbitrator or otherwise.

The losses shall include all monetary liabilities to the opposing party or to others

(whether because of settlement or verdict after trial or otherwise), including fines

and other monetary liabilities incurred during the reporting period as a result of

civil actions (for example, civil judgments or settlements), regulatory proceedings

(for example, penalties, disgorgement or restitution) and criminal actions (for

example, criminal judgement, penalties or restitution) brought by any entity (for

example, governmental, business or individual).

The scope of monetary losses shall exclude legal and other fees and expenses

incurred by the entity in its defence.

Note to IF-EN-250a.2

The entity shall briefly describe the nature (for example, judgement or order

issued after trial, settlement, guilty plea, deferred prosecution agreement or non-

prosecution agreement) and context (for example, negligence) of all monetary

losses resulting from legal proceedings.

The entity shall describe any corrective actions implemented in response to the

legal proceedings. These corrective actions may include specific changes in

operations, management, processes, products, business partners, training or

technology.

Lifecycle Impacts of Buildings & Infrastructure

Topic Summary

Buildings and major infrastructure projects are among the largest users of natural

resources in the economy; during construction, these materials include iron and steel

products, cement, concrete, bricks, drywall, wallboards, glass, insulation, fixtures, doors,

and cabinetry, among others. Once completed, and during their daily use, these projects

often consume significant amounts of resources in the form of energy and water (for a

discussion on direct environmental impacts from project construction see the

Environmental Impacts of Project Development topic). Therefore, the sourcing of

construction materials and the everyday use of buildings and infrastructure may

contribute to direct and indirect greenhouse gas (GHG) emissions, global or local resource

constraints, water stress and negative human health outcomes. Client and regulatory

pressures to develop a sustainable built environment are contributing to the growth of

IFRS S2 INDUSTRY-BASED GUIDANCE

markets intended to reduce the lifecycle impacts of buildings and infrastructure projects.

In response, various international sustainable building and infrastructure certification

schemes assess, among other aspects, a project’s use-phase energy and water efficiency,

impacts on human health, and the use of sustainable construction and building

materials. As a result, various opportunities are being created for industries in the value

chain—from suppliers that can provide such materials, to entities in the Engineering &

Construction Services industry that can provide sustainability-oriented project design,

consulting and construction services. Such services can provide a competitive advantage

and revenue growth opportunities as client demand for economically advantageous

sustainable projects increases and related regulations evolve. Entities unable to

effectively integrate such considerations into their services may lose market share in the

long term.

Metrics

IF-EN-410a.1. Number of (1) commissioned projects certified to a third-party

multi-attribute sustainability standard and (2) active projects seeking such

certification

multi-attribute sustainability standard and (2) active projects seeking such

certification

The entity shall disclose (1) the number of projects commissioned during the

reporting period certified to a third-party multi-attribute sustainability standard.

1.1

The scope of third-party multi-attribute sustainability standards is limited

to standards or certifications that, at a minimum, address the following

aspects of building or infrastructure design and construction:

1.1.1

Energy efficiency;

aspects of building or infrastructure design and construction:

1.1.1

Energy efficiency;

1.1.2

Water conservation;

1.1.3

Material and resource efficiency; and

1.1.4

Indoor environmental quality.

1.2

Examples of third-party multi-attribute sustainability standards include:

1.2.1

BREEAM®

1.2.2

Green Globes®

1.2.3

Institute for Sustainable Infrastructure’s (ISI) Envision®

1.2.4

LEED®

The entity shall disclose (2) the number of active projects that sought certification

1.2.4

LEED®

The entity shall disclose (2) the number of active projects that sought certification

to a third-party multi-attribute sustainability standard during the reporting

period.

2.1

The scope of active projects includes all buildings and infrastructure

projects actively under development at the close of the reporting period,

which may include those in the design and construction stages.

2.2

The scope of active projects excludes projects commissioned during the

reporting period.

2.2

The scope of active projects excludes projects commissioned during the

reporting period.

The entity shall disclose the third-party multi-attribute sustainability standard(s)

to which projects are certified or seeking certification.

IFRS S2 CLIMATE-RELATED DISCLOSURES–JUNE 2023

The scope of disclosure is limited to projects in which the entity had a direct role

in design, engineering, procurement or construction of the building or

infrastructure project.

The scope of disclosure includes buildings (such as residential, commercial and

retail, government, healthcare and offices) and other infrastructure projects (such

as transportation, oil and gas, electrical grid, renewable energy, water supply

distribution and water treatment).

The entity may discuss sustainability standards or guidelines implemented during

its building or infrastructure design and construction projects that are not third-

party verified.

IF-EN-410a.2. Discussion of process to incorporate operational-phase energy and

water efficiency considerations into project planning and design

The entity shall provide a discussion of the process used to incorporate

operational-phase energy and water efficiency considerations into project

planning and design.

1.1

Operational-phase energy and water efficiency considerations to reduce

and optimise operational use of energy and water may include water

collection and reuse designs, repair and retrofits, improved insulation and

material use, shading devices, energy procurement, and the use of energy-

and water-efficient devices and lighting.

1.2

Relevant information to disclose may include:

1.2.1

The actions taken to incorporate such considerations, such as

design solutions, technological solutions, material use, modelling

of energy and water use

1.2.2

The geographical markets where the entity operates, including

current and expected future energy and water efficiency

regulations, potential constraints on water or energy resources,

and stakeholder demands in those markets

1.2.3

Whether these energy and water efficiency solutions serve as

competitive advantages in project bids and proposals, and how the

entity

communicates

performance—including

any

perceived

competitive advantages—to project owners

1.2.4

How the entity communicates long-term cost-benefit analyses to

1.2.4

How the entity communicates long-term cost-benefit analyses to

project owners or developers, including the potential savings from

energy efficiency projects based on past performance of energy

efficiency projects

The entity shall describe how it assesses the risks associated with operational-

phase energy and water efficiency considerations, including internal policies,

practices and procedures.

The entity shall describe its use of codes, guidelines and standards that address

operational-phase energy and water efficiency, when applicable.

IFRS S2 INDUSTRY-BASED GUIDANCE

3.1

The entity may discuss how its energy and water efficiency efforts exceed

building code requirements.

The scope of disclosure excludes environmental impacts associated with project

construction, as well as codes, guidelines and standards associated with project

construction, both of which are included within the scope of IF-EN-160a.2.

Climate Impacts of Business Mix

Topic Summary

Engineering & Construction Services industry clients may be exposed to potentially

Topic Summary

Engineering & Construction Services industry clients may be exposed to potentially

disruptive climate regulation as well as those that mitigate climate change. Some types of

construction projects are significant climate change contributors because of the

greenhouse gases (GHGs) emitted during their use phase. Projects that may contribute to

global GHG emissions include those in extractive industries, as well as large buildings.

Whereas some infrastructure projects, such as renewable energy projects, are designed to

reduce GHG emissions, many types of projects present trade-offs. Mass transit systems,

for example, may contribute to GHG emissions while reducing net emissions once the

benefits offered by the system are factored. Several entities in the industry generate a

substantial share of revenue and profits from clients in carbon-intensive industries and

whose future capital investments may be at risk because of evolving climate regulations.

Downside risks may manifest through project delays, cancellations and diminished long-

term revenue growth opportunities. On the other hand, entities that specialise in

infrastructure projects that contribute to GHG mitigation could develop competitive

advantages as they continue to focus on these growing markets. As the industry and its

customers continue to operate within an uncertain business environment and face

increasing environmental and regulatory requirements, assessing and communicating

the risks and opportunities stemming from climate change that are embedded in an

entity’s backlog and future business prospects may help investors in assessing the overall

business impact of climate change.

Metrics

IF-EN-410b.1. Amount of backlog for (1) hydrocarbon-related projects and

(2) renewable energy projects

1 The entity shall disclose the amount of its backlog associated with (1) hydrocarbon-related projects.

1.1

hydrocarbon-related projects.

1.1

Backlog is defined as the value of projects not completed as of the close of the reporting period (revenue contractually expected in the future but that has not been recognised), or is defined by the entity, consistent with its existing disclosure of backlog. Backlog also may be referenced as revenue backlog or unsatisfied performance obligations.

1.2

Hydrocarbon-related projects are defined as any type of project directly

1.2

Hydrocarbon-related projects are defined as any type of project directly associated with the hydrocarbon value chain, which may include:hydrocarbon exploration,extraction,development,production or transportation; hydrocarbon infrastructure services and maintenance;

hydrocarbon power generation; and hydrocarbon-related downstream services.

1.2.1

Examples of hydrocarbon-related projects include any project directly associated with oil, gas or coal production, transportation,

refining, and fossil fuel-based electricity generation.

2 If a significant portion of the entity’s backlog in hydrocarbon-related projects is associated with natural gas power generation projects, the entity may provide supplementary disclosures describing this proportion of backlog and the

supplementary disclosures describing this proportion of backlog and the sustainability impacts of such projects relative to alternatives or baseline scenarios.

3 The entity may provide a description of the sustainability implications of hydrocarbon-related projects,which may include project descriptions,

categorisations by resource type, expected sustainability impacts, and risks related to project completion or conversion to revenue.

to project completion or conversion to revenue.

4 The entity shall disclose the amount of its backlog associated with (2) renewable energy projects.

4.1

Renewable energy is defined as energy from sources that are replenished at a rate greater than or equal to their rate of depletion, such as geothermal, wind, solar, hydro and biomass.

5 The entity shall exclude from its calculations and disclosures of backlog any amount of an order backlog cancellation that re-enters order backlog during the

amount of an order backlog cancellation that re-enters order backlog during the same reporting period because of a project owner’s successful re-planning of the project.

6 The scope of disclosure is limited to projects in which the entity provided engineering, architecture, design, construction, installation, planning, consulting,

repair or maintenance services, or other similar services.

IF-EN-410b.2. Amount of backlog cancellations associated with hydrocarbon-related projects 1

IF-EN-410b.2. Amount of backlog cancellations associated with hydrocarbon-related projects 1 The entity shall disclose the amount of its total backlog associated with hydrocarbon-related projects of any type cancelled during the reporting period for any reason.

1.1

has not been recognised), or is defined by the entity, consistent with its existing disclosure of backlog. Backlog also may be referenced as revenue backlog or unsatisfied performance obligations.

1.2

Backlog cancellations are defined as the amount of backlog cancelled,

reduced, terminated or deferred such that it no longer meets the definition of backlog, or that which is removed from the backlog for any reason other than conversion to revenue or currency exchange rate fluctuations.

reason other than conversion to revenue or currency exchange rate fluctuations.

1.2.1

Backlog cancellations include cancellations that occur for any reason, which may include a customer’s failure to obtain necessary project permitting or financing, a customer’s voluntary project cancellation, and reduction in project scope because of financial constraints.

1.2.2

The scope of backlog cancellations excludes cancellations associated with decommissioning projects.

1.3

Hydrocarbon-related projects are defined as any type of project directly

1.3

hydrocarbon power generation; and hydrocarbon-related downstream services.

1.3.1

Examples of hydrocarbon-related projects include any project directly associated with oil, gas or coal production, transportation,

directly associated with oil, gas or coal production, transportation,

refining, and fossil fuel-based electricity generation.

2 The scope of disclosure is limited to projects in which the entity provided engineering, architecture, design, construction, installation, planning, consulting,

repair or maintenance services, or other similar services.

3 The entity may discuss specific backlog cancellations, including the root cause and corrective actions taken to prevent future backlog cancellations.

and corrective actions taken to prevent future backlog cancellations.

IF-EN-410b.3. Amount of backlog for non-energy projects associated with climate change mitigation 1 The entity shall disclose the amount of its backlog for non-energy projects associated with climate change mitigation.

1.1

Backlog is defined as the value of projects not completed as of the close of the reporting period (revenue contractually expected in the future but that

the reporting period (revenue contractually expected in the future but that has not been recognised), or is defined by the entity, consistent with its existing disclosure of backlog. Backlog also may be referenced as revenue backlog or unsatisfied performance obligations.

1.2

Non-energy projects are defined as projects not directly associated with the energy value chain, such that the energy value chain may include:hydrocarbon exploration, extraction, development, production and

hydrocarbon exploration, extraction, development, production and transportation; power generation projects (hydrocarbon and renewable);

and energy infrastructure services and maintenance.

1.3

Climate change mitigation is defined by the Intergovernmental Panel on Climate Change (IPCC) as an anthropogenic intervention to reduce the sources or enhance the sinks of greenhouse gases (GHG).

2 The scope of disclosure shall only include projects that are significantly motivated

2 The scope of disclosure shall only include projects that are significantly motivated by, or undertaken in response to, climate change mitigation. Such climate change mitigation is not required to be the primary project motivation, but it shall be a significant motivating factor for project development and implementation.

2.1

Examples of projects that may be associated with climate change mitigation include: mass transportation systems; alternative, low-carbon transportation systems; carbon capture and storage; hydrocarbon-related decommissioning projects;

and energy efficiency infrastructure retrocommissioning.

3 The scope of disclosure shall only include projects that provide significant climate change mitigation relative to a baseline scenario, or baseline emissions, defined as

change mitigation relative to a baseline scenario, or baseline emissions, defined as the GHG emissions that may occur without project implementation.

3.1

The entity may use jurisdictional or proprietary methodologies for assessing climate change mitigation relative to a baseline scenario or baseline emissions.

4 The scope of disclosure shall exclude all backlog directly associated with the energy value chain, which may be equivalent to backlog included in IF-EN-410b.1,

energy value chain, which may be equivalent to backlog included in IF-EN-410b.1,

except for hydrocarbon-related decommissioning projects.

5 The entity may exclude backlog associated with decommissioning projects.

6 The scope of disclosure is limited to buildings and infrastructure projects in which the entity provided engineering, architecture, design, construction,

installation, planning, consulting, repair or maintenance services, or other similar services.

IFRS S2 INDUSTRY-BASED GUIDANCE 14

services.

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