Deloitte
Accounting Research Tool
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Chapter 2 — Identification of a Company’s Organizational Boundary

2.2 Equity Share Approach

2.2 Equity Share Approach

The Corporate Standard provides that “[u]nder the equity share approach, a company accounts for GHG emissions from operations according to its share of equity in the operation.” The equity share, or economic interest, reflects the reporting company’s rights to the risks and rewards from an operation. If the legal ownership percentage does not equal the reporting company’s economic interest in a business, the economic interest will be the prevailing determinant for calculating the reporting company’s reported GHG emissions, since the economic interest is expected to be a better representation of the rights to the risks and rewards than legal ownership.