Human-induced climate change has triggered the adoption of measures across the world with the intention of reducing our CO2 footprint. Although shipping and aviation were initially exempt from such measures, over the last decades authorities around the world have changed their views and aligned these sectors with other industries. This is because the share of greenhouse gas emissions from international aviation rose rapidly in recent decades, with the sector now contributing to around 4% of the European Union (EU)’s total greenhouse gas emissions[1]. Additionally, prior to the COVID-19 pandemic, the International Civil Aviation organization (ICAO) predicted that in comparison to 2015, international aviation emissions could triple by 2050. This has placed increased focus on the industry to help address the climate crisis.

Aviation will now have to face new challenges prompted by a more environmentally conscious approach. Over the last decade the EU and the global aviation community have pooled resources to construct a decarbonisation pathway for the sector, with some of the regulatory tools being the European Trading Scheme (ETS), Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA), and the proposed ReFuelEU and Energy Taxation Directives.

Although these measures are laudable in view of their ultimate goals, they have at times been criticised for potentially being ineffective. Furthermore, in our view, measures should not be limited to taxation but should also include incentives to promote the use of sustainable fuels, technology, and processes that reduce carbon emissions.

Carbon Emissions Reductions in Aviation

KPMG in Malta’s long-standing association with the sector has seen us support aviation clients navigate multiples issues over the years. Our team is closely following developments on the above-mentioned themes within the aviation sector. KPMG network firms have successfully performed over 3,000 carbon emission verification engagements for aviation clients world-wide.

With carbon professionals embedded within KPMG’s global transport practice, having the right technical skills, international verification experience in the aviation sector, and the specific knowledge of EU ETS and CORSIA we remain committed to be of support to the sector in the context of the changing regulatory climate.

KPMG can also support aviation companies to develop and refine their ESG strategy, and support with ESG implementation and reporting, such as that required by the upcoming Corporate Sustainability Reporting Directive (CSRD).

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