Jakub Wolanski, Founder, CirculaTech
Under AASB S2, Scope 3 emissions are deferred for one reporting year and become mandatory in your second. For most Group 2 entities, that means the first mandatory Scope 3 disclosure lands in FY2028 — but the device-level records you will need to support it are being created, or lost, in the disposals you run this year.
Who is actually in scope, and from when?
Group 2 entities entered their first mandatory reporting period on 1 July 2026 under the Australian Sustainability Reporting Standards. An entity falls into Group 2 if it meets at least two of three thresholds: consolidated revenue of $200 million or more, gross assets of $500 million or more, or 250 or more employees.
That first sustainability report sits alongside the annual financial report and carries the same legal weight under the Corporations Act. It is not a voluntary ESG brochure.
AASB S2’s Appendix C provides three transitional reliefs to first-year reporters: no comparative information is required, a non–GHG Protocol measurement method may continue to be used, and Scope 3 emissions — including financed emissions — may be deferred to the second reporting year.
The deferral is the part most IT and procurement teams misread. It is a one-year grace period on disclosure, not on data collection. A Scope 3 figure disclosed in FY2028 needs an evidence base built well before it.
Where do laptops and servers sit in Scope 3?
In the GHG Protocol’s Scope 3 categories, corporate technology typically appears in two places. Category 1, purchased goods and services, captures the embodied emissions of the equipment your organisation buys. Category 2, capital goods, captures equipment capitalised as an asset — which is where a large enterprise fleet refresh usually lands.
For most non-industrial Australian organisations — professional services, financial services, government, health, education — purchased and capital goods are a material share of the total Scope 3 footprint. Hardware is not a rounding error in these sectors. It is one of the few categories where the reporting entity has direct, documented control over what happens.
That control cuts both ways. Because you can evidence it, you will be expected to.
What does device disposal actually change in the number?
Two things, and it is worth being precise about the difference.
The first is avoided emissions. When a retired laptop is sanitised, refurbished and resold into a second life rather than shredded, the buyer does not manufacture a new device. That avoided manufacturing has a real emissions value — but it sits outside your inventory boundary. It is a claim about the wider system, not a deduction from your Scope 3 total. Reporting it as a reduction in your own footprint is exactly the kind of statement that draws scrutiny.
The second is your own future purchasing. Redeployment and extended device life reduce the number of new units you buy in later periods, which does reduce Category 1 and Category 2 in those periods. That is a legitimate, in-boundary reduction — and it is the stronger story, because it shows up in your own numbers rather than in a footnote.
We have written separately on reporting IT asset sustainability without greenwashing and on the business case for a reuse-first asset policy. The short version: report avoided emissions as avoided emissions, clearly labelled and separately stated, and report reductions as reductions.
What data should you be capturing from each disposal now?
Units by category — laptop, desktop, server, monitor, mobile — not a single aggregate weight.
The link between your asset register and what physically left the building.
Resold, redeployed, or recycled. An aggregate “diversion rate” is not an outcome record.
Which factors, which source, whose assurance. A number without a method is not assurable.
Who took the material at each hop, and under what licence or scheme approval.
Most organisations discover the gap late. Disposal has historically been managed as a facilities or logistics task, evidenced by a collection docket and a tonnage figure. Tonnage tells a sustainability team almost nothing — it does not distinguish a resold laptop from a shredded one, and it cannot be reconciled against an asset register.
Why does the methodology behind the number matter more than the number?
Because for the first three reporting years from 1 January 2025, Scope 3 disclosures, scenario analysis and transition plans sit under modified liability arrangements — commentary on the transition describes these as protected statements, generally exposed only to regulator-brought or criminal action until 31 December 2027. Directors, during this period, declare that the entity took reasonable steps to comply rather than declaring full compliance.
That is a transition, not an exemption, and it ends. Any organisation treating the relief period as time to keep estimating is building an evidence gap that becomes visible the moment the relief lapses. Confirm your own position with your auditor — the arrangements are detailed and entity-specific.
The practical implication for IT and procurement: choose disposal partners now on the strength of their reporting, not just their pricing. CirculaTech provides carbon impact reporting through our partner Rejoose, whose carbon-data methodology and platform have been subject to an independent EY assurance engagement under ISAE 3000 (Revised), with the methodology separately verified by PNZ Advisory as aligned with the GHG Protocol. That is the standard of provenance a sustainability team can hand to an auditor without caveat.
What should IT leaders do in the next twelve months?
Start by finding out whether your current disposal process can answer three questions for last quarter: how many devices left, what happened to each one, and who says so. If the answer involves a phone call to a vendor, the process is not report-ready.
Then set the requirement into your next disposal contract rather than requesting it as a favour. Serial-level reporting, outcome by device, and a documented emissions methodology are all specifiable in an agreement. They are considerably harder to reconstruct after the fact.
You can see how CirculaTech structures device-level reporting on our sustainability page.
FAQ
When do I actually have to disclose Scope 3 under AASB S2?
From your second mandatory reporting period. Group 2 entities entered their first period on 1 July 2026, so for most that means the first mandatory Scope 3 disclosure falls in FY2028. First-year reporters may use the Appendix C transitional relief to defer it.
Do laptops and servers count as Scope 3?
Yes. Purchased technology generally falls under Scope 3 Category 1 (purchased goods and services) or Category 2 (capital goods), depending on whether it is expensed or capitalised.
Can I subtract the emissions avoided by reselling old devices from my Scope 3 total?
No. Avoided emissions occur outside your inventory boundary. They can be reported, but must be stated separately and clearly labelled as avoided emissions — not netted against your reported footprint.
What does a device disposal report need to contain to be useful for ESG reporting?
At minimum: device counts by type, serial-level identification, the outcome for each device (resold, redeployed, recycled), the methodology and emissions factors behind any carbon figure, and the downstream chain of custody. Aggregate tonnage is not sufficient.
Is the transitional liability relief a reason to delay?
It reduces exposure on Scope 3 statements for a defined transition period ending 31 December 2027, but it does not remove the disclosure obligation and it does not extend the data you will need. Verify your specific position with your auditor.