Broadening our scope 2012 IPC POSTAL SECTOR SUSTAINABILITY REPORT - International Post Corporation
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Broadening our scope 2012 IPC POSTAL SECTOR SUSTAINABILITY REPORT THE NATURAL PARTNER FOR THE POSTAL INDUSTRY
1. Introduction • EMMS participants 3 • Statement from the CEO 4 • Key figures 8 2. Carbon Management • The Environmental Measurement and 9 Monitoring System • Carbon management proficiency 12 • Carbon emissions 16 About the International 3. Posts’ Best Practice Cases Post Corporation • Broadening the scope 23 • Post's best practice cases 24 The International Post Corporation is a cooperative association of 24 member postal operators in Asia Pacific, Europe and North America. Over the past two decades IPC has provided industry leadership by driving service quality and interoperability, supporting its members to ensure the high performance of international mail services and developing the IT infrastructure required to achieve this. IPC engages 4. Annex & Assurance in industry research, creates business-critical intelligence, provides a range of platforms for member post CEOs and senior management to • Indicator definitions 38 exchange best practices and discuss strategy, and gives its members an • Exclusions and estimations 39 authoritative, independent and collective voice. IPC also manages the • Independent assurance report 40 system for incentive-based payments between postal operators. With members delivering some 80% of global postal mail, IPC represents the majority of the world’s mail volume. For more information please visit our website at www.ipc.be.
EMMS participants In 2008 International Post Corporation launched its Environmental Measurement and Monitoring System An Post Ireland Magyar Posta Zrt Hungary (EMMS), the first ever global approach for carbon emissions Australian Postal Corporation Australia New Zealand Post Ltd New Zealand reduction for a services industry. Now, four years on, we are bpost Belgium Nigerian Postal Service Nigeria well on track to reach the ambitious goals of cutting the Canada Post Corporation Canada Österreichische Post Austria global postal sector’s carbon emissions by 20%. Over the Empresa Brasileira de Correios e Telégrafos Brazil Poste Italiane Italy last year the programme has continued expanding both its Correos y Telégrafos Spain Posten Norge Norway CTT Correios de Portugal Portugal PostNord Denmark and Sweden measurement scope and its geographical reach. Deutsche Post DHL Germany PostNL Netherlands Entreprise des Postes et Royal Mail Group Plc United Kingdom Télécommunications Luxembourg Luxembourg South African Post Office South Africa Le Groupe La Poste France Swiss Post Switzerland Hellenic Post-ELTA Greece United States Postal Service United States Itella Ltd Finland International Post Corporation Postal Sector Sustainability Report 3
Introduction Statement from the CEO With the passing of another year of commendable mitigation This year we have also seen a substantial increase in the efforts and carbon emission reductions, International Post number of participants measuring and reporting emissions Corporation is pleased to announce the results of the postal emerging not just from the operations under their direct industry’s environmental sustainability efforts in 2011. control, but from the wider value chain. As these indirect Under IPC’s global postal sustainability programme, the aspects can have a large impact, it is vitally important that IPC Environmental Measurement and Monitoring System they are not overlooked in our measurement and monitoring (EMMS), participating postal operators have collectively activities. In recognition of this fact, the 2012 IPC Postal reduced CO2 emissions by over 3.5% since 2010, equivalent Sector Sustainability Report has been dedicated to the to a reduction of 261,000 tonnes. management of emissions across the value chain. In the following pages we illustrate how EMMS participants are Our current rate of progress far exceeds the required rate going further, to address the indirect impacts throughout the to meet our collective target of a 20% absolute reduction value chain, with case studies to provide concrete examples in emissions by 2020. When combined with the emissions of some of the innovative mitigation approaches that are reduction achievements of the past years, the EMMS now being rolled out across the sector. participants are now almost three-quarters of the way to achieving our group target. If we continue at this rate, We believe that collaboration is essential to effectively we will reach our goal much earlier than expected. These address the environmental challenges we currently face. impressive results reflect the continued efforts by the EMMS We have therefore been working hard to increase the participants to innovate, both in terms of the efficiency of geographical scope of our global sustainability programme. their products, services and technologies and in driving the As the first sector-wide carbon reduction initiative for a behavioural changes needed to address the challenge of services industry, we have always focused on engaging as climate change. many postal operators from around the world as possible. International Post Corporation Postal Sector Sustainability Report 4
Introduction Following last year’s inclusion of the South African Post Office in the EMMS, we are delighted to welcome two new in our journey towards the achievements of our targets for 2020. We will be working vigilantly to ensure that our “ Our current rate of progress far exceeds participants: Empresa Brasileira de Correios e Telégrafos participants are provided with the necessary support in their the required rate to meet our collective (Correios Brazil) and Nigerian Postal Service (Nigeria Post). mitigation efforts, to provide on-going monitoring and target of a 20% absolute reduction in These two new entrants represent a significant expansion oversight and to encourage the sharing of best practice of the programme into two highly populated and rapidly approaches among peers. We invite you to listen, as we have emissions by 2020. developing countries. We feel that this is a further done, to the multiple voices of our industry stakeholders and If we continue at this rate, we will reach ” demonstration of how the postal sector is working to bridge look forward to further years of continuous improvement. the perceived divide between developed and developing our goal much earlier than expected. economies in tackling a truly global problem. Correios Brazil is one of the largest postal sector organisations in the world and is located in an important emerging economy. Herbert-Michael Zapf, Furthermore, we hope that the addition of Nigeria Post IPC President & ceo as the second African postal operator in the programme will support our ambitions to expand further still into the developing nations of Africa. Once again, I have found the considerable progress made over the year extremely encouraging and would like to congratulate all of our participants on their excellent achievements in enhancing their sustainability performance. However challenges remain and we must not be complacent International Post Corporation Postal Sector Sustainability Report 5
New Participant - Brazil Correios Brazil is set to make far-reaching impact through the EMMS programme, as Latin America’s largest postal service Empresa Brasileira de Correios e Telégrafos (Correios Brazil) has The social and environmental activities undertaken by Correios been experiencing consistent growth and increasing revenues Brazil are aligned to national and international guidelines in recent years as the post continues on its path to be a for sustainability, including the United Nations Millennium world-class company in terms of organisational management, Development Goals and the thirteen national guidelines of procedures and results. the instrument of the Presidency. The post has also positioned its strategy based on the ‘Triple Bottom Line’ of economic, Since its origins in 1663, Correios Brazil has been striving social and environmental concerns. In the current global to create a modernised service that meets the quality landscape of major technological change and new habits, expectations of its customers. Historically the company Correios Brazil is very much aware that environmental issues, has always played an important role of social inclusion and including climate change, are increasingly emerging as critical integration in national development. It has also acted as an topics of strategic concern to the growth and development important government agent in the social field; its many roles of both enterprises and nations. Correios Brazil has already From left to right: Mr Wagner Pinheiro de Oliveira, include the distribution of textbooks, the payment of pensions, been demonstrating its commitment to support these causes President, Correios Brazil; Dr Herbert-Michael Zapf, the transportation of emergency support, campaigns related to for many years. The implementation of the Environmental President and CEO, International Post Corporation breastfeeding and the training of needy youngsters. Correios Administration System (SGAC), has increased its capability to Brazil will continue to push for excellence in its products and measure its environmental impacts and has driven continuous The company believes that the EMMS programme is services in order to contribute to the competitiveness of the improvement. Among numerous other initiatives, the vitally important in driving down global carbon impacts country and improve the quality of life of society at large. company has its EcoPostal initiative to reuse uniforms and from the postal industry through its provision of sector- postal mailbags, promotes sorted recyclable waste collection wide management proficiency assessments, emissions and responsible waste management, has carried out pilot measurement, sector benchmarking, results reporting and testing of electric vehicles, and is involved in the direction of group targets. As the leading postal operator in Latin America’s environmental education and the promotion of eco-efficient largest economy, Correios Brazil has acknowledged that its products and services. participation in the programme represents a crucial expansion Key facts - Brazil of the postal industry’s focus and co-ordinated carbon Capital: Brasília In June this year Mr. Wagner Pinheiro de Oliveira, CEO of reduction action. The EMMS programme provides a global Population: 193,947,000 Correis Brazil, announced the participation of Correios Brazil framework through which the post can support its sector Total area: 8,514,877 km2 in the IPC Environmental Measurement and Monitoring peers in a collaborative way, share best practices, and drive System (EMMS), a participation that is a logical next step continuous improvement as global problems require global Official language: Portuguese in the organisation’s environmental sustainability strategy. solutions. International Post Corporation Postal Sector Sustainability Report 6
New Participant - Nigeria Nigeria Post (NIPOST) fully supports the EMMS and is ready to play its role in further expansion of the programme across the African continent Nigeria Post provides vital services in both urban centres I am delighted that Nigeria Post has joined International Post and rural communities, acting as an essential force in Corporation’s EMMS sector sustainability programme. I am in community development for Nigeria’s population of over full support of the ambitions of IPC to bring African nations 165m. Since the country’s independence in 1960, Nigeria into this global system of carbon emissions management Post has been striving to work towards the creation of a and reporting. As a consequence of our strong regional service that is ever more efficient and responsive to public role and our participation in this sustainability programme needs, whilst maintaining reasonable costs. as the second African participant, we will be able to set an example to other developing postal operators and work to Presently there are 1,176 post offices and over 2,442 further increase engagement with the programme across the postal agencies throughout the Federation providing African continent. Efficient use of natural resources and the postal, logistic, financial and other communication conservation of energy should be a key concern for all African From left to right: Mr Pieter Reitsma, services to the populace. Based in the most populous nations. Furthermore, joining the EMMS programme will Sustainability Manager, International African country and one of the largest economies on the allow Nigeria Post to contribute to an important global effort, Post Corporation; Mr Ibrahim Mori Baba, continent, NIPOST is one of the leading posts in West share best practices and learn from its peers around the world. Postmaster General and CEO, Nigerian Postal Africa. Service In line with our participation in the EMMS, I affirm the However, while we anticipate significant growth in the commitment of Nigeria Post to sustainable business coming decades, we are also committed to ensuring that development and commit our solidarity to contributing to this growth is managed in a fully sustainable way. To this the collective attainment of the sector’s carbon emissions end, we hope to play a leading role in societal issues such reduction target for 2020. as the campaign against stigmatisation of people living with HIV and the fight against its spread, promoting a greener and better working environment for our workers, Mr Ibrahim Mori Baba Key facts - Nigeria carbon emissions reduction and other important topics. Postmaster General and CEO Capital: Abuja We believe that collaboration between postal operators, Nigerian Postal Service Federation: 36 States and working together across both developing and developed Federal Capital economies, is essential for us to be able to tackle the common, global problem of climate change and which in Population: 166,629,000 the long run would ensure a more efficient management Total area: 923,768 km2 of our resource and promote environmental responsibility. Official language: English International Post Corporation Postal Sector Sustainability Report 7
Carbon management In 2011 the IPC Environmental Measurement and Monitoring System participants continued their collective efforts to reduce carbon emissions, resulting in yet another year of impressive results. This year full Scope 3 reporting was included in the reporting, in order to monitor carbon emissions throughout the entire value chain. With Carbon Management Proficiency scores continuously improving and carbon emissions decreasing significantly, participating posts have once again seen their management and mitigation efforts pay off. International Post Corporation Postal Sector Sustainability Report 8
Carbon management The Environmental Measurement and Monitoring System The Environmental Measurement and Monitoring System (EMMS) was Comprehensive data collection developed in 2008, in direct response to requests from CEOs working Carbon Management throughout the postal industry. The system was built with the aim of The EMMS process begins with the participating postal companies Proficiency implementing a common carbon measurement and reporting framework, completing an annual comprehensive self-assessment questionnaire • Average CMP score of 70% in line with customer requirements and stakeholder expectations. A pilot on their management proficiency which entails a primarily qualitative • 5% improvement from of the system was carried out in 2008, in collaboration with our EMMS assessment across ten management proficiency areas. participants. 2010 The results of the questionnaire are analysed and used in our assessments • ON TARGET to achieve In 2009, the full programme was rolled out with the first data collected for the Carbon Management Proficiency (CMP) section of the EMMS. >90% goal for 2020 and progress measured for the 2008 calendar and financial reporting The next part of the process involves reporting on performance trends, year. This represents the benchmark year of the EMMS programme. sector averages and company scores, for both the qualitative Carbon The objective is to drive both carbon management proficiency and Management Proficiency (CMP) section of the EMMS and a suite of 16 performance by providing a common reporting structure for posts to Carbon Performance Indicators (CPI) across five categories: Overall Sector disclose their environmental management strategies and achievements. Indicators, Scope 1, Scope 2, Scope 3 and Activity Indicators. EMMS participants employ around 2.0 million staff across the globe In order to ensure consistency of the data, participants are encouraged at over 100,000 facilities, with well over half a million delivery and to use our calculator tool and are provided with an exhaustive guidance Carbon Performance transport vehicles. Through fuel combustion, the energy used to heat document for reference. This year we have implemented an additional Indicators and cool buildings and several other sources, these companies release plausibility checking process to further ensure consistency and accuracy of • 3.5% or significant volumes of CO2 into the atmosphere. At IPC, we are working data collected across the group. The final results are subject to review by 261,000 tonnes to systematically address these impacts and collaborating to combat global IPC and Maplecroft, an independent advisory consultancy specialising in reduction from 2010 climate change across the sector through our EMMS programme. We global risks management. This review process also stimulates constructive • IPC group Scope 1 & 2 believe that through the sharing of knowledge and the encouragement feedback, monitoring and continuous improvement of the programme for of positive action, the entire postal industry will be able to lower its the future. emissions environmental impacts, thus addressing stakeholder concerns about its 7,173,000 tonnes contribution to greenhouse gas emissions. The calculator tool and associated guidance materials are aligned with • ON TARGET to achieve the requirements of international best practice standards including ISO 20% reduction goal for 14001 (environmental management), ISO 14064 (carbon accounting), the 2020 Greenhouse Gas Protocol, Dow Jones Sustainability Index, FTSE4Good, and current best practice as used by members of the Carbon Disclosure Project and the US Climate Registry. Each participant is provided with their results in the form of an individual scorecard and assessment and given ample opportunity to engage and share feedback on their experiences and progress. International Post Corporation Postal Sector Sustainability Report 9
Carbon management Broadening our scope IPC continues to broaden the scope of participation in the EMMS indicated. For a detailed overview of participation in both the carbon programme. This year we welcome two new EMMS participants, Empresa management proficiency and carbon performance aspects of the EMMS, Brasileira de Correios e Telégrafos (Correios Brazil) and The Nigerian please refer to the exclusions and estimations in the Annex p39. Postal Service (Nigeria Post) which will bring the total number of EMMS participants to 25. Correios Brazil and Nigeria Post will be formally This report presents the overall results of our EMMS programme for integrated and report their first set of EMMS results in 2013. the calendar year 1st January to 31 December 2011. In limited and unavoidable cases, some degree of estimation has been necessary. For The South African Post Office (SAPO) has submitted its quantitative carbon example, in order to ensure consistency in scope, some participants may performance data this year, representing the company’s first step towards have been obliged to make estimations of their performance in certain the achievement of our collective goal. As part of the review procedures areas. In such cases, estimations are made very carefully by the reporting for this report, SAPO was also visited by our external accountant PwC. postal operator to ensure that they are as accurate and realistic as With the aim of ever increasing disclosure, participants have increased the possible. scope of their submissions by including subsidiaries or other parts of their business such as newspaper delivery and direct marketing services. For In this report, IPC has also provided the range of coverage provided by more information see Annex p39. the data for each indicator, calculated as follows: the percentage of the business, as quantified by operational revenue, that reports data on a Consistent with previous years, the figures presented in this report certain indicator, is divided by the total revenue of all EMMS participants. continue to reflect the mail and parcel operations of our participants. Coverage data is provided in relevant carbon performance data tables in Information relating to express and logistics services, while included in the brackets, in cases where this is not 100%. overall EMMS programme, has not been included in this report in order that we can focus our analysis on the core comparable mail and parcel To provide additional assurance, this report has been reviewed and operations. To facilitate accurate year-on-year comparisons, all carbon approved by the management of IPC. We have followed reasonable performance data is categorised according to whether it relates to the steps and taken great care to ensure that the information and indicators original set of EMMS participants (excluding Österreichische Post, Poste published in this report are accurate to the best of our knowledge. In Italiane and the South African Post Office, which have joined since 2009). addition, we have instructed our external accountant PwC to review the The original set of participants can then be compared to the ‘extended key sector indicators. The metrics verified by PwC are indicated by a group’, which also includes these three new entrants. The figures provided rhombus symbol (♦) accompanying the relevant reporting category. The in this report relate to the original set of participants unless otherwise results can be found in the Assurance Report on p40. International Post Corporation Postal Sector Sustainability Report 10
Carbon management Sector scorecard IPC provides all participants with a detailed scorecard and assessment of Figure 1: EMMS Sector Scorecard their performance in both carbon management proficiency and carbon emissions performance. The scorecard contains more than 800 data points and trend indicators to give each participant a detailed overview 2012 IPC EMMS Sector Scor ecard 2012 IPC EMMS Sector Scorecard of their performance and to allow benchmarking with previous years. As Carbon pe rformance indicators the standard EMMS scorecard for each company contains confidential 22 y Telégrafos, EMMS participants bpost, Canada Post, Correos The Carbon Corp, Austria Post Corp, Post ELTA, Itella carbon em Performance sect An Post, Australian Postal Groupe La Poste, Hellenic ion of the Participating postal , Deutsche Post DHL, Le , P&T issions and CTT Correios de Portugal Posten Norge, PostNL, PostNord outlets and energy use EMMS is an asse organisations Zealand Post, Poste Italiane, Postal Service financial across the six categor ssment of the qua information, we are not in a position to make these public. However, in Ltd., Magyar Posta, New Swiss Post, United States services. South African Post Office, The results ies of ma ntitative Royal Mail, presented Luxembo urg, here focus il, parcels, expess aspects of carbon EMMS Gr on the cor (na e 'mail and tional and interna managem 301,262m oup Emiss ent tional), log , including Postal volume (items) ions (Mail parcels' acti line with our intention to promote disclosure and increase transparency of vities. istics, reta 52,819,000m 2 & Parcel) il Building area - Tonnes of 2,039,000 Scope 2008 CO 2 No. of employees the EMMS programme, this year, we have produced an additional overall 2009 571,000 2010 No. of vehicles 2011 1&2 Key drivers iency 8,360,000 sector scorecard to be made available to the public. Carbon management profic cy is measured using the EMMS questionnaire, which involves an assessment section takes inco account across ten areas the qualitative aspects 7,763,00 7,434,000 Scope 2 ele in buildin ctricity purchased 7,173,000 gs for use Carbon Management Proficien systems approach. This significant has been the sing -check-act' management source sinc le most aligned with IPC's 'plan-do manage ment proficiency (CMP). programm e, makin e the sta rt of each postal compan y's carbon 2011 2010 3 combined g up 48.5% of the 2008 2009 NC Scope 1 & of the 2 impact 64.9/100 69.9/100 10,014,000 Outsourc in 2011. The sector scorecard contains overall group summary information such as 61.3/100 ed transport or sub-contracted 8,722,000 ncy score 56.4/100 10,292,000 has been Carbon management proficie road 87.9/100 90.4/100 source sinc the most 84.9/100 83.3/100 making up e the sta rt of the significant – IPC leader Required pro 31.7/100 impact in 42.2% of the total gramme, a list of participants, total group postal volumes, total vehicle numbers and 21.4/100 annual red 19.1/100 20.4/100 uction to achieve the 2011. Scope 3 – IPC lowest (on Scope IPC target 1 & 2 em of 20% to achieve 90% by 2020 issions) by s in line with the IPC target the total reported group building area. Carbon management proficiency Annual pro 2020 Annual progres EMMS gress in line Leader Group Em with this -139,333 (score 2011) issions Re IPC target tCO (score 2008) (score 2009) (score 2010) IPC range ductions pr 2 ogress scores are provided for 2008-2011 including a graph and summary table Lowest Tonnes Annual emis (%) 9,000,000 sions redu ction (on Scope 1 & detailing performance trends for the four year period. In terms of carbon 2) towards 100 2020 targ 8,500,000 et (Mail and Parcel) Target 90 8,000,000 performance, the sector scorecard summarises the total group emissions 80 70 7,500,000 -7.1% reductions progress in comparison to the group target and provides an 60 50 2020 Target 6,688,000 7,000,000 - 4.2% tonnes 6,500,000 - 3.5% explanation of EMMS reporting protocols. 40 30 6,000,000 2020 The two page EMMS sector scorecard can be found online at 5,500,000 Target 20 -20% 5,000,000 10 http://www.ipc.be/Services/Sustainability/EMMS/EMMS_Scorecard and reporting management and verification Performance Value chain Measurement 0 2008 engagement Further de Disclosure and standards Management and Strategy 2009 tails procedures Employee Policy and Targets 2010 Activity Principles The figures 2011 relating to presented on this scorecard 58.8% 65.8% 59.8% this scorec express and logisti reflect the 74.0% ard in ord cs core mail 81.9% 65.6% 60.5% 71.7% accurate er that we services, while inc and parcel yea luded in 2011 47.1% 79.0% 66.2% 72.7% 51.8% 60.0% 54.3% Austria Pos r-on-year compar can focus our ana the overall operations of our 56.9% t, Poste Ital ison lysis EM par 45.4% 74.1% 81.4% 58.9% 52.5% 50.5% iane and s, the data presen on the core compar MS programme, has ticipants. Informa 50.5% the South ted tion 2010 64.8% 68.8% African Pos relates to the origable mail and par not been 78.6% 54.3% 52.9% t) which cel operat included on 40.5% 69.0% 49.7% 42.9% have join inal set of EMMS ion 2009 50.2% 60.5% 58.7% 41.9% ed since 2009. participan s. To facilitate 63.5% 71.4% 50.9% ts (excludin EMMS in other publications 2008 30.5% ENVIRON MEN g TAL MEA Date: 2012 V2 SUREMENT AND MO NITORING (EMMS) SYSTEM MENT AND MONITORING SYSTEM (EMMS) ENVIRONMENTAL MEASURE Date: 2012 V2 As the EMMS programme continues to expand its global reach and demonstrate impressive group-wide management proficiency increases recognised. Apart from being published in over a dozen sustainability and emissions reduction achievements, its success is increasingly being reports of our participants, the EMMS has also been acknowledged by global media and external publications, an indication that the programme is having an influential effect across the sector. We anticipate further recognition of the programme and attention focused on the achievements of our EMMS members as we continue to progress towards our targets for 2020. International Post Corporation Postal Sector Sustainability Report 11
Carbon management Carbon management proficiency In 2011, EMMS participants achieved an average score of 70%, evidence In 2011 an additional company reported their endorsement of the that our target is both realistic and attainable. Over this three year period, United Nations Global Compact – Caring for Climate voluntary action the annual current rate of improvement in management proficiency is over platform, bringing the total sector engagement to over 66% and an 4 percentage points per year, well exceeding the required rate to achieve increase of over 38% since the start of the programme (2008: 29%). In our goal in 2020. addition, the number of companies submitting their information to the Table 1: Key Carbon Management Proficiency results 2008-2011 CMP score 2008 Required CMP score 2009 CMP score 2010 CMP score 2011 Goal for 2020 Target status (baseline) improvement 56% 61% 65% 70% > 90% ~ 3% per year On target We believe that these improved results indicate an increasing appreciation Carbon Disclosure Project has risen by over 14%. As EMMS participants of energy and carbon emissions as a strategic priority in business incorporate the guidance and commitments of this initiative into their management, and that EMMS participants are continually working to operational and strategic approaches, we anticipate further improvements update and improve their management systems, policies and procedures in both carbon management proficiency and emissions reductions. to accommodate these priorities. Over 85% of participants reported performance improvements. We believe that continued improvements at We have observed an overall increase in the participants demonstrating this rate (approximately 5% per annum) will enable us to reach our 2020 their environmental commitments with over 86% of participants publicly goal well ahead of schedule. Our projections indicate that we will have stating their greenhouse gas reduction targets, an increase of 29% reached our target by 2017, and possibly even earlier. from the start of the EMMS programme. Six participants have made commitments to become carbon-neutral in the future, or by a specified Consistent with previous years, in 2011 IPC companies again performed date and two thirds also have their own independently developed targets best on issues relating to policy and procedures (82%), management and in place that are at least in line with the sector 20% by 2020 reduction strategy (79%), target setting (74%) and measurement and verification goal (known as the ‘20-2020 target’). (72%). The use of systematic environmental management approaches has been steadily increasing, with 76% of participants now operating a Responsibility for climate change, carbon management and emissions developed, documented and communicated environmental management is clearly defined for the majority of participating posts, with many system. Furthermore, 62% of participants are either seeking or have also having individual energy and carbon metrics in senior manager implemented internationally recognised certification for these systems performance appraisals and performance-related pay schemes. such as EMAS or ISO 14001. International Post Corporation Postal Sector Sustainability Report 12
Carbon management It is encouraging to see that the management of environmental impacts Figure 2: Range and average carbon management proficiency scores by section across the value chain has been steadily increasing year on year. In 100% 2008, EMMS participants typically rated their value chain management programmes as ‘under development’. In 2009, as we began to see the benefits of this development, 85% had developed at least general 90% environmental requirements for their suppliers. In 2011, 24% of participants have gone even further to impose specific energy and carbon requirements. These are being progressively rolled out for all primary 80% 82% 81% 79% contracts and sub-contractors in many cases. In addition, over 95% of 79% participants are now actively communicating with customers or suppliers 74% 74% 73% 70% 72% 71% on carbon management issues. However, there remain opportunities for 70% 69% 69% value chain best practices to be extended across the sector, in particular 66% 66% 65% 65% 65% with regard to the methods of assessment used, such as second or third 63% 60% 61% 60% 60% party auditing. 60% 59% 60% 59% 58% 57% 56% 54% 54% 53% 52% 50% 52% 51% 49% 50% 50% 49% 47% 45% 40% 42% 42% 41% 30% 20% 31% 10% 0% 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Overall Principles & Management Policy & Employee Activity Measurement Targets Performance Disclosure & Value Chain Standards & Strategy Procedures Engagement & Verification Reporting Management 2008 2009 2010 2011 Minimum and maximum ranges in 2008 and 2011 International Post Corporation Postal Sector Sustainability Report 13
Carbon management Figure 3: Projected carbon management proficiency scores through 2020 The ten focus areas of the carbon management proficiency assessment include questions carefully designed to evaluate specific aspects of 100% each participant's approach to carbon management. Important group Projected attainment in 2017 (vs. 2020) developments since 2008 include: 90% IPC EMMS goal of 90% 80% • t he UN Global Compact – Caring for Climate voluntary action 70% Required rate of increase programme has gained support from two thirds of EMMS 70% 65% to achieve 2020 goal participants; 61% 60% 56% • increased information submissions to the Carbon Disclosure Project (CDP), an initiative designed to encourage full public disclosure of 50% carbon performance data; 40% • a significant increase in the number of participants that carry out assessments of the risks as well as the opportunities related to 30% carbon management and climate change; • a larger proportion of participants that incorporate carbon 20% management indicators, objectives and targets into management 10% performance reviews; • a substantial increase in the number of companies transporting post 0% by vehicles using alternative fuels; 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 • a notable increase rise in the number of companies referencing their IPC required rate IPC current rate sustainability reporting against the Global Reporting Initiative; •g rowing popularity of the use of formalised supplier assessment methods including self, second and third party auditing, and the setting of minimum performance criteria. International Post Corporation Postal Sector Sustainability Report 14
Carbon management Areas for improvement The three carbon management proficiency areas which registered the Such initiatives require detailed cost-benefit analysis as well as the lowest scores were; principles and standards (47%); performance (59%) availability of appropriate national infrastructures, such as the suitability and value chain management (60%). This trend has remained consistent of rail networks and timetables. In addition, EMMS participants across with previous years, however all three areas have shown year-on-year the globe have regional and seasonal climate differences to take into improvements since 2008. account. To overcome these challenges can often require the development of technologies with specific minimal technical standards. Several EMMS We will be encouraging our participants to improve their scores in the participants are also exploring and testing potential alternative energy principles and standards section, for example by promoting engagement sources including solar power, geothermal and wind in both buildings and with relevant international organisations and initiatives, such as the UN vehicles. Global Compact – Caring for Climate, Carbon Disclosure Project and certification to internationally recognised EMAS or ISO 14001 standards. Many companies have already implemented ‘quick-win’ emission reductions initiatives, such as switching to green electricity, increasing fuel efficiency and vehicle route optimization. To achieve further reductions, leading participants will be required to make more significant and longer term investments in infrastructure developments, for example through the construction of LEED (Leadership in Energy and Environmental Design) or BREEAM (Building Research Establishment Environmental Assessment Method) buildings, and further increasing the use of alternative fuel vehicle fleets. Through engagement with our EMMS participants, we have learned that the development of alternative vehicle delivery fleets is ongoing. For example, piloting activities and negotiations with vehicle manufacturers to develop bespoke delivery vehicles are still being carried out by several participants. This indicates that the update of alternative vehicles is likely to increase even further in future years. International Post Corporation Postal Sector Sustainability Report 15
Carbon management Carbon emissions In the carbon performance section of the EMMS, we assess the In 2011, the Scope 1 and Scope 2 carbon emissions from EMMS quantitative elements including carbon emissions and energy use across participant ‘mail and parcel’ activities amounted to 7,173,000 tonnes the six categories of mail, parcels, express (national and international), (2010: 7,434,000). Please see Figure 8 (p18) for a detailed breakdown logistics, retail outlets and financial services. The results presented in this across the entire EMMS group. This year’s decrease of 261,000 tonnes report focus on the core ‘mail and parcels’ activities with assessments is less pronounced than the 329,000 tonnes reported last year and carried out using 16 carbon performance indicators. Emissions reductions less still than the decrease of 597,000 tonnes reported between 2008 have been tracked according to international greenhouse gas accounting and 2009. This trend of decreasing reductions may be driven in part standards, in particular the World Resources Institute Greenhouse Gas because the ‘low hanging fruit’ in carbon reductions have already been Protocol. In line with this protocol, we will refer to direct and indirect achieved. Nevertheless, the decrease is still nearly double the required emissions using the following Scope 1, Scope 2 and Scope 3 terminology: annual reduction of 140,000 tonnes and we remain assured that EMMS participants are on target to reach the group target of a 20% reduction by Scope 1: All direct GHG emissions, including those from buildings and 2020. transport owned by the company (see Figure 6, p18); In order to maintain the comparability of the figures, the figures presented Scope 2: Indirect GHG emissions, from consumption of purchased above exclude the increased scope and emissions coverage associated electricity, heat or steam (see Figure 7, p18); with three new participants since 2009; Austria Post, Poste Italiane and the South African Post Office. If we increase the coverage to include the Scope 3: Other indirect emissions, including transport-related activities by emissions from these operators, the result is a sector output of 7,645,000 vehicles not owned or controlled by the reporting entity, business travel tonnes. This represents an overall decrease of 155,000 tonnes from last and employee commuting, outsourced activities, waste disposal, etc. year’s figures (2010: 7,800,000 tonnes). IPC provides each EMMS participant with a detailed summary of its carbon performance alongside its carbon emissions data. The data provides insights into carbon efficiency across various aspects and categories of their business and is designed to enable continuous improvement through focused emission reduction initiatives. The figures disclosed herein relate to the ‘mail and parcels’ categories, excluding peripheral express and logistics services. Table 2: Annual carbon emissions Performance 2008 Required Performance 2009 Performance 2010 Performance Goal for 2020 Target status (baseline) improvement 8,360,000 tonnes 7,763,000 tonnes 7,434,000 tonnes 7,173,000 tonnes 6,688,000 tonnes ~2% reduction per year On target (- 7.1%) (- 11.1%) (-14.2%) (- 20%) International Post Corporation Postal Sector Sustainability Report 16
Carbon management Figure 4: Mail & parcel Scope 1 & 2 carbon emissions (excluding new participants) 9,000,000 8,360,000 8,500,000 7,763,000 8,000,000 7,434,000 7,500,000 7,000,000 7,173,000 CO2 6,500,000 2020 Target 6,000,000 (6,688,000 tonnes) 5,500,000 5,000,000 2008 2009 2010 2011 Figure 5: Projected Scope 1 & 2 mail and parcel carbon emissions reductions through 2020 (excluding new participants) 9,000,000 8,360,000 8,000,000 7,763,000 CO2 6,688,000 7,000,000 7,434,000 7,173,000 IPC EMMS 2020 20% reduction goal IPC EMMS 2020: 6,000,000 5,000,000 -20% 4,000,000 4,521,000 3,000,000 2,000,000 1,000,000 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 IPC required rate IPC current rate International Post Corporation Postal Sector Sustainability Report 17
Carbon management Emissions sources In 2011, total Scope 1 impacts amounted to 3,553,000 tonnes, Carbon emissions associated with purchased electricity consumption representing a notable 13.6% decrease from 2008 levels (4,112,000 in buildings, including sorting centres, post offices and administrative tonnes). However, when compared with 2010, Scope 1 impacts have operations, represents the largest Scope 2 source. This year we are remained overall stable with a very slight increase from 3,536,000 pleased to report reduced emissions of 3,470,000 tonnes, a reduction of tonnes. The most significant contributory emissions source was 11% from our 2010 figure of 3,898,000 tonnes. Since the start of the owned or leased road transportation, with over three quarters of programme in 2008, IPC participants have achieved an overall reduction the total group Scope 1 emissions (see fig 6). Overall emissions from of 18.3% in emissions from purchased electricity, indicative of the transportation in 2011 were 2,700,000 tonnes, a small increase of effectiveness of carbon mitigation measures and increased use of green 2.8% from 2010 levels (2,676,000 tonnes). Emissions produced from electricity. buildings (as heating) exhibited a reduction of 4.0% from 2010 to 826,000 tonnes (2010: 860,000 tonnes). Activity indicators Figure 6: Scope 1 Figure 7: Scope 2 Figure 8: Combined emission sources emission sources Scope 1 & 2 emissions sources Emissions per item In 2011, the total CO2 emitted in grams per item was 25 (2010: 24 0.9% 3.6% 1.8% 0.5% grams). There remain challenges in separating mail and parcels in our accounting exercises as several of the postal providers were unable 11.5% 23.3% to distinguish emissions from mail versus parcel deliveries due to the significant shared infrastructures and sorting facilities. We believe that this slightly higher grams per item figure for 2011 is due in part to a 48.5% continuing trend of declining mail volumes throughout the sector. Total group postal volumes between 2010 and 2011 have reduced from 297 37.7% 75.8% to 283 billion items of mail. This makes sustained emissions reductions 96.4% per item a significant challenge. In addition, our EMMS participants operate under national regulations which often include a Universal Service Obligation (USO) to make daily deliveries to every household by P roduced from buildings: As heating P roduced from buildings: Scope 1 Road transport law. Such regulations may reduce the flexibility of participants to adapt Road transport As electricity purchased Scope 1 Produced from buildings: As Others (e.g. Stationary purpose Produced from buildings: heating the efficiency of their operations. combustion) As heating (inc. district heating and Scope 2 Produced from buildings: steam) As electricity purchased Scope 2 Produced from buildings: As heating (inc. district heating and steam) Others (e.g. Stationary purpose combustion) International Post Corporation Postal Sector Sustainability Report 18
Carbon management Renewable energy Table 3: Figure 9: Alternative EMMS participants are required to provide energy use data for levels of vehicle / alternative fuel renewable electricity purchased (‘green’ electricity). There were large capable vehicle types variations in the percentage of renewable electricity used in buildings among operators, with 48% of EMMS participants purchasing some Alternative vehicle type Number reported 7.6% form of green electricity in 2011 (45% in 2010). IPC also collects E85 (Ethanol fuel blend) 39,754 8.6% energy use data for a range of alternative energy sources, including Self-propelled (e.g. bicycles) 37,214 43.3% geothermal, biomass, solar and wind power. If we expand our coverage Electric 7,017 to include these sources, in 2011 67% of EMMS participants reported Others - inc. Hybrid, Compressed Natural Gas 7,891 on the use of some form of renewable energy, a substantial increase (CNG) & Liquid Propane Gas (LPG) from the 41% in 2010. Total alternative vehicles 91,876 40.5% The total percentage of green electricity as a proportion of total electricity In 2011, alternative vehicles/alternative fuel capable vehicles made up consumption within the group was 11%, an increase of 4% from over 17% of the total reported vehicles figure, representing an impressive E85 (Ethanol fuel blend) 2010. When combined with green electricity, renewable energy sources increase from the 10% recorded for 2010. The largest single category Self-propelled (e.g. bicycles) accounted for 6.3% of all energy used by EMMS participants in buildings, was E85 capable vehicles (an ethanol fuel blend). There has also been a Electric Other - including hybrid, Compressed representing an increase from 2010 (4%). Note, these calculations relate substantial increase in reporting relating to self-propelled vehicles, e.g. Natural Gas (CNG) & Liquid Propane to acknowledged additional emissions reduction activities only and do bicycles. IPC will continue to measure and encourage further uptake of Gas (LPG) not include standard green energy currently included in the grids of host alternative vehicles throughout the EMMS group. countries due to hydropower or other lower carbon sources. Table 4: Alternative vehicles This year we required our EMMS participants to provide a greater degree of disclosure and categorisation on their alternative vehicles/alternative 2009 2010 2011 fuel capable vehicles. Participants were asked to provide numbers of Total vehicles 585,700 568,400 527,200 alternative vehicles across ten categories. This will allow us to deduce Total alternative vehicles 57,900 57,700 91,900 detailed group trends in alternative vehicle usage for future years. % alternative vehicles in EMMS Alternative vehicle types reported across the EMMS group are provided in 10% 10% 17% group the following table. Note: Reported figures differ slightly from those reported last year due to restated data provided by one participant. International Post Corporation Postal Sector Sustainability Report 19
Carbon management Table 5: Carbon performance data in tonnes of CO2 (coverage is 100% unless indicated in brackets) Original participants Extended Group Indicator 2008 2009 2010 2011 2009 2010 2011 Scope 1: Transport (vehicles, aviation, rail) ♦1 2,948,000 2,857,000 2,676,000 2,700,000 3,008,000 2,828,000 2,858,000 Scope 1: Heating (gas, heating, fuel, oil, steam) ♦ 1,164,000 979,000 860,000 826,000 1,057,000 920,000 891,000 Scope 2: Electricity (including electric vehicles) ♦ 4,248,000 3,927,000 3,898,000 3,470,000 4,062,000 4,052,000 3,713,000 TOTAL2 8,360,000 7,763,000 7,434,000 7,173,000 8,143,000 7,800,000 7,645,000 Total CO2 in tonnes per 1000 euro turnover3 ♦ 0.067 0.064 0.063 0.058 0.058 0.056 0.052 Total CO2 in grams per item – mail and parcels ♦ 29 (84%) 25 24 25 25 25 26 Percent of renewable electricity used in buildings ♦ 13% (93%) 9% 7% 11% 11% 10% 14% Percent of renewable energy used in buildings ♦ 8% (79%) 7% 4% 6% 9% 6% 8% Percent of alternative vehicles in fleet ♦4 10% 10% 10% 17% (95%) 11% 10% 16% (96%) Notes: 1The rhombus symbol (♦) denotes data on which PwC has provided limited assurance. 2Due to differences in inter-departmental accounting procedures, the stated figures may not sum to equal the total. 3Figures per €1,000 turnover were calculated using average annual currency conversion statistics sourced from the Organisation for Economic Co-operation and Development (OECD). 4 Reported figures in 2009 and 2010 of the Original participants differ slightly from those reported last year due to restated data provided by one participant. Scope 3 emissions sources • Outsourced or sub-contracted road transport • Outsourced or sub-contracted air transport Scope 3 includes indirect emissions associated with the wider supply chain • Employee commuting and distribution networks. Since the boundaries of Scope 3 emissions are • Business travel potentially very broad, IPC has produced a guidance document covering specific reporting procedures which is communicated to all participants, We believe that the collection of Scope 3 inventories will be very useful providing a consistent set of parameters for industry-wide reporting of for our EMMS participants to better understand the upstream and Scope 3 emissions. The guidance builds on the framework set out in downstream greenhouse gas implications of their corporate activities. The the GHG Protocol Corporate Standard. Our current focus is primarily on above sources are examined in our performance monitoring system as transport-related impacts and in 2011, based on participant feedback and part of our commitment to continuous improvement and in order to build analysis of past years data; we narrowed the scope of our data collection a more comprehensive and accurate account of greenhouse gas emissions to the following four core categories. These categories make up over 95% across the EMMS group. Please note that although employee commuting of total Scope 3 emissions: impacts are significant, several posts are currently unable to collect International Post Corporation Postal Sector Sustainability Report 20
Carbon management data on this source for privacy/legal reasons. Therefore, in some cases • The average operational coverage level of outsourced or sub-contracted road national averages have been used. In these cases, mitigation activities transport figures was 47%; focused on employee commuting will not result in measurable decreases • All respondents reported data on this emissions source. in emissions from this source. Outsourced or sub-contracted air transport In a significant improvement from last year, 20 of the participating • 66% of respondents that reported on this source estimated their figures, based companies submitted Scope 3 emissions data in their EMMS calculator, on tonne/km or distance data; representing group coverage of 95% compared with an 82% response • The remaining participants made actual measurements, based either on rate in 2009 and 2010. The sector has exhibited an overall increase in the actual fuel consumption or the monetary value spend on fuel by sub- Scope 3 emissions of approximately 1,874,000 tonnes, an increase of contractors; 22% from 2010 levels. The increase is not cause for concern however, • The average operational coverage level of outsourced or sub-contracted air as it is driven by increasing disclosure of sources from several of our transport figures was 93%; EMMS participants who have expanded their Scope 3 reporting • Three respondents did not report on this emissions source. boundaries. The largest Scope 3 impact emerged from outsourced or sub-contracted road transport with 4,330,000 tonnes, representing Employee commuting 42% of the total group impact. A further 30% is associated with sub- • 55% of respondents that reported on this source estimated their figures, based contracted air transport. The least significant reported Scope 3 impact on national statistics on average commuting; was from business travel, with only 1% of the group total (see Figure • The remaining 45% estimated their employee commuting figures based on 10, p22). other factors, such as data collected through internal surveys; • Four respondents made use of systematic planning and monitoring systems to Scope 3 survey estimate their employee commuting figures, for example fuel cards and barcode As part of the 2012 EMMS, we encouraged all EMMS participants scanning; to complete a survey on the topic of their Scope 3 reporting policies • The average operational coverage level of employee commuting data was 99%; and approaches, in order to gain deeper insights into what remains a • Six respondents did not report data on this emissions source. developing area of EMMS reporting. For the 2011 reporting year we had 15 respondents to the survey representing 71% of participants. Business travel • Business travel emissions were measured, based on an overview of actual flights Outsourced or sub-contracted road transport by 60% of respondents; • A third of respondents estimated their outsourced or sub-contracted • All other respondents made an estimation, for example based on costs spent on road transport figures, based on the total number of kilometres driven flights and distances travelled; and the average fuel consumption (per type of vehicle) per km; • Two respondents did not report data on this emissions source. • This source was measured, based on the total fuel consumption by subcontractors, by 13% of respondents; • The remaining participants used other forms of estimation, e.g. based on total subcontractor spend, or made use of a combination of both estimation and measurement approaches; International Post Corporation Postal Sector Sustainability Report 21
Carbon management Table 6: Scope 3 carbon emissions in tonnes of CO2 (coverage is 100% unless indicated in brackets) Original participants Extended group Indicator 2009 1 2010 1 2011 ♦ 2 2009 2010 2011 ♦ CO2 emissions in tonnes Outsourced or sub-contracted road transport 3,730,000 (89%) 3,590,000 (89%) 4,330,000 (98%) 3,748,000 (78%) 3,639,000 (78%) 4,515,000 (99%) Outsourced or sub-contracted air transport 2,704,000 (86%) 2,736,000 (86%) 3,069,000 (97%) 2,704,000 (74%) 2,740,000 (74%) 3,069,000 (82%) Employee commuting 3,045,000 (58%) 2,008,000 (58%) 2,812,000 (78%) 3,045,000 (50%) 2,008,000 (50%) 2,812,000 (66%) Business travel3 392,000 (92%) 84,100 (92%) 81,000 392,000 (80%) 84,100 (80%) 92,000 (98%) TOTAL 9,871,000 8,418,100 10,292,000 9,889,000 8,471,100 10,488,000 Notes: 1Total figures for 2009 and 2010 have been restated from those previously reported, in line with our narrowed focus on the four above categories. 2The rhombus symbol (♦) denotes data on which PwC has provided limited assurance. 3 The large decrease in the business travel figure for 2009 was due to the revision of an estimated figure by one participant. Figure 10: Scope 3 carbon emissions (significant impacts) 1% 27% 42% 30% utsourced or sub-contracted road O transport Outsourced or sub-contracted air transport Employee commuting Business travel International Post Corporation Postal Sector Sustainability Report 22
Posts’ Best Practice Cases Broadening the scope In this report we have emphasised Scope 3 reporting. Our EMMS participants have already undertaken considerable efforts together with their subcontractors, suppliers and other partners to improve the sustainability of their entire value chains. These best-practice cases illustrate how transport can be optimised in an environmentally friendly way, how staff commuting can be managed in a more sustainable way and how collaboration can lead to improved efficiencies. International Post Corporation Postal Sector Sustainability Report 23
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