ENVIRONMENT
Managing the impact of natural perils is core business for IAG.
The graph below illustrates our performance over the past 5 years in key environmental metrics.
Australia and New Zealand CO2e
We are committed to being Carbon Neutral by 2012 and are very pleased with the 11.8% reduction in carbon dioxide equivalent emissions across our Australian and New Zealand business. Since 2005 we have achieved a 34.7% reduction in our combined environmental footprint.
In Australia, our CO2e emissions from electricity consumption account for 75% of our emissions profile. This is because electricity production in Australia is primarily fuelled by coal, which when combusted, produces a large amount of greenhouse gases. Much of New Zealand's electricity is generated from renewable resources and has enabled our New Zealand business to select a supplier that provides energy from 100% renewable resources so the proportion of their environmental footprint that is attributable to electricity is significantly lower.
Australia
New Zealand
The fall in our CO2e emissions in Australia has been driven by a significant fall in electricity consumption. Electricity consumption has fallen 12.2% on prior year and is attributable to continuing measures to reduce consumption, raising awareness with our people and our occupation of more energy efficient buildings. During the year we moved into new offices in Parramatta in western Sydney and our CGU Insurance business reallocated to new headquarters in Melbourne. We expect to achieve green star energy efficiency ratings for both of these buildings in the coming year. A building upgrade at our Sydney headquarters of 388 George Street has also resulted in significant energy savings for that building, one of the largest in our network.
The fall in electricity consumption in Australia has been slightly offset by a small increase in electricity consumption for our New Zealand business. This increase is a result of widening the scope of our data measurement to include the Hilmorton data centre, which accounts for about 10% of New Zealand's electricity footprint. In previous years, the data centres were not included in the electricity measurement as kWh usage data could not be obtained for these sites. We are anticipating that our New Zealand electricity use will increase by 5 – 10% again next year as we begin to include data from our second data centre at Albany. However, at the end of this financial year our Auckland head office moved into a more environmentally sustainable building so the electricity consumption benefits of this will be seen next year.
We have also seen a continuing trend in the reduction of print paper consumption and air travel across the business. In particular the air travel reductions have been achieved through concerted efforts by our people to minimise their travel, assessing the necessity of the travel and attending multiple meetings in one trip. Video conferencing and the use of Microsoft Office Live meeting are being encouraged and used as alternatives to face to face meetings.
Whilst these results have been pleasing, we recognise that we haven't got everything right. Tool of trade vehicle fuel consumption has increased over the prior year in New Zealand and although in total consumption has reduced in Australia, per vehicle consumption has infact increased. Offie paper consumption has also increased slightly in Australia, reinforcing the need for us to continue to drive reduction initiatives in these areas.
This table illustrates our environmental footprint split into scope 1, 2 and 3 emissions.
| AU tonnes CO2e 2009 |
NZ tonnes CO2e 2009 |
AU tonnes CO2e 2008 |
NZ tonnes CO2e 2008 |
||||||
| Scope 1—Tool of trade fuel fleet | |||||||||
| Direct emissions | –Petrol | 5,074 | 972 | 6,103 | 904 | ||||
| –LPG | 1,301 | – | 990 | – | |||||
| –Diesel | 72 | – | 75 | – | |||||
| Scope2—Electricity | |||||||||
| Indirect emissions | –metered | 36,139 | 1052 | 43,201 | 812 | ||||
| –extrapolated | 3,797 | – | 2,469 | – | |||||
| Scope 3—Other | |||||||||
| Indirect emissions | Air travel | ||||||||
| –short haul | 125 | 734 | 62 | 1,085 | |||||
| –medium haul | 2,246 | – | 1,980 | 253 | |||||
| –long haul | 2,388 | 185 | 3,612 | 25 | |||||
| Paper | |||||||||
| –print paper | 1,938 | 393 | 2,057 | 408 | |||||
| –office paper | 447 | 64 | 435 | 70 | |||||
| TOTAL CO2e | 53,527 | 3,400 | 60,984 | 3,557 | |||||
Whilst our UK operations have not reported their environmental footprint externally again this year, they continue to be signatories to Climatewise, an initiative of The Prince of Wales's Corporate Leaders Group on Climate Change. This Group focuses on responding to the risks and opportunities posed by climate change and has established a set of principles for insurance and reinsurance companies worldwide which provides a framework to help the companies build climate change into their business operations. For more information refer to www.climatewise.org.uk.
Last year we committed to investigating measuring our water consumption and landfill waste. Whilst progress has been made during the year we have not progressed these as far as we would like and will continue to investigate them in the current year.
Case studies
In the case studies below we share some of the initiatives that have driven our environmental performance.
Greening our property network through more efficient buildings
Our carbon footprint in the UK
Rewarding customers for sustainable activities
Reducing waste to landfill through uniform recycling
| Greening our property network through more efficient buildings | |
|---|---|
|
Efficient use of the resources that we need to run our business will help our business and the environment become more sustainable longer term. That's why IAG is taking action across Australia and New Zealand to reduce our impact on the environment and increase the energy efficiency of the buildings we occupy. During the year three IAG sites have moved into more sustainable buildings; in Melbourne our CGU headquarters have relocated to more environmentally friendly premises; in Parramatta, NSW we have moved into 10 floors of more sustainable office space that brings together around 900 employees representing different brands from across IAG and in Auckland we are the first insurer to occupy one of New Zealand's most environmentally friendly buildings. We have experienced the impact of these moves already; our electricity consumption for the year has fallen significantly. Key features of these buildings include making more use of natural light, collection of rain water for use throughout the buildings and the use of state of the art air conditioning that allows zoned climate control. Our Auckland headquarters have been awarded a 5 star Green Star rating on the office design and whilst we have not as yet received Green Star ratings for the other two buildings, we expect to in the coming year. Whilst these buildings are more energy efficient, they have also been designed to create better, healthier and safer working environments for our people. We already have evidence from our Parramatta building that since the move to the new premises, there has been a fall in the level of absenteeism for our people located there. |
|
| Our carbon footprint in the UK | |
|---|---|
|
IAG UK understands both the significance of the climate change challenge and the implications of everyday operations on the environment around us.
As with IAG's Australian and New Zealand businesses, the data collated is converted into CO2 equivalent emissions following the methodology of the World Business Council for Sustainable Development (WBCSD) Green House Gas (GHG) Protocol and guidance from the UK Department for Environment Food and Rural Affairs (DEFRA). In the time since their first report was prepared, they have made considerable reductions in electricity consumption (the main carbon footprint contributor), and have reduced the amount of fuel used for business travel and paper used in offices. Although not reported externally, the Carbon Footprint Reports have helped the business incorporate better management and control systems into internal operations. In previous years, IAG UK has taken the decision not to report their footprint externally however the quality and quantity of data they collect continues to improve, enabling them to present more accurate results. Consequently in the coming year their footprint will be reported together with our Australian and New Zealand operations. |
|
| Rewarding customers for sustainable activities | |
|---|---|
|
Creating value for society is a priority at IAG; that's why we continue to launch products that reward our customers for exhibiting sustainable behaviour. Our Direct Insurance brands offer advice and discounts to help customers save on their insurance premiums if they engage in sustainable behaviours, which in turn may reduce the impact on our environment. For example, customers can save up to 10% on their Comprehensive Car Insurance and Comprehensive Plus Insurance if they have one of our recognised fuel efficient cars. We also have a Carbon Offsets Program that enables customers to offset the CO2 produced by their cars by purchasing carbon credits to invest in renewable energy or programs to store carbon, such as sequestration schemes. Through CGU Insurance, customers are offered a motor insurance product that recognises and rewards, through a discounted insurance premium, car owners aged 25 or over who drive their vehicle less than 10,000 kilometres a year. The Nominated Driver Low kilometre Motor Vehicle insurance provided by CGU Insurance rewards customers for lowering their car's impact on the environment and is an innovative solution for customers who drive relatively low kilometres each year. Our New Zealand business is continuing to build on their suite of sustainable insurance products and in 2009 extended their NZI branded sustainability product suite to their commercial customers. Green incentives are now offered to commercial motor, multi dwelling and material damage customers. |
|
| Reducing waste to landfill through uniform recycling | |
|---|---|
|
Textiles have an aggressive ecological footprint through the manufacturing and lifecycle process and waste textiles create a significant solid waste to landfill issue at end of life, creating a negative environmental impact. As a customer facing business many of our people wear a corporate wardrobe, and we wanted to know that we were not adding to these issues when our uniforms got old or needed to be replaced. Consequently, IAG Australia has this year pioneered a formal uniform recycling program to reduce the ecological footprint of waste textiles that would otherwise end up as landfill. IAG's recycling program is run using a model that has been established by Waste Diversion Enterprises (WDE) who partner with Kids Off The Kerb, a charity focused on assisting local at risk young people. The joint venture model creates environmental enterprises (for example clothes recycling) that provide employment and training opportunities for youth at risk. The uniform recycling program generates benefits across environmental, social and economic perspectives; not only does it divert the uniforms from landfill, it stimulates education, training and employment opportunities for youth at risk, and supports the creation of new business opportunities. |
|
