UK & Ireland GHG emissions
We aim to minimise the environmental impact of our business activities wherever possible. To do this, we address the key areas of our operation where we can deliver the best results in reducing our emissions. These include:
- engaging our people on environmental issues through consultation, training and an extensive communications and awareness programme supporting behavioural change at work and at home
- providing a range of financial and non-financial incentives to influence employee behaviour
- operational controls, including mandatory internal policies and procedures, to regulate employee practices
- investing in building infrastructure to reduce energy consumption and travel alternative technologies such as video conferencing and web-based meetings.
Our emissions data
The UK firm of Ernst & Young LLP is a limited liability partnership incorporated under English Law with registered number OC300001 and is a member firm of Ernst & Young Global Limited. Registered office and principal place of business: 1 More London Place, London SE1 2AF.
The Irish firm Ernst & Young is a Member Practice of Ernst & Young Global Ltd. It is authorised by the Institute of Chartered Accountants in Ireland to carry on investment business in the Republic of Ireland. Registered address: Ernst & Young, Ernst & Young Building, Harcourt Centre, Harcourt Street, Dublin 2, Ireland.
This report covers the total emissions of both organisations which are collectively referred to in this report as ‘EY’.
Data reported above covers the period 1 July 2009 - 30 June 2018. Each reporting year corresponds with EY’s financial year, which runs from 01 July to 30 June.
Reasons for changes in emissions
In FY2018 our total absolute scope 1 + 2 + 3 emissions increased by 12% (8,929 t CO2e) compared to the previous year, and were 34% (21,232 t CO2e) higher than the base year. The material influences on our performance are as follows:
Travel: The majority of our organisation’s GHG emissions (87%) come from scope 3 business travel – an essential element in delivering our advisory, tax and assurance services to clients. Due to the nature of professional services activities, travel activity is heavily influenced by the rate at which the organisation is growing and our strategy for delivering services within the UK, across EMEIA and globally. In FY2018, our UK&I revenues increased by 6% and headcount (FTE) remained flat.
FY2018 saw a significant rise in total scope 3 emissions (17% / 10,901 t CO2e) mainly attributable to an increase in business travel, specifically air travel. There have been decreases in both distance travelled and related CO2 emissions across all modes of road and rail travel. However, air travel related emissions increased by 22% (11,938 t CO2e) compared to FY2017. We believe this may be due in part to a relaxation of the travel restrictions and authorisation processes put in place during the previous year, as well as an increased focus on our service line teams delivering against the firm’s target growth plans. In addition, there was a year-on-year increase to the DEFRA emission factors for various flight categories, ranging from 1% to 12% compared to equivalent 2017 factors.
Energy: In FY2018 our total scope 1 emissions fell by 15% (215 t CO2e) compared to the previous year. Within this, emissions from natural gas consumption fell by 44% (420 t CO2e) due to EY switching its gas supply contract to renewable biomethane gas (certified under the Green Gas Certification Scheme) on 1 January 2018. Scope 2 emissions (location-based) fell by 20% (1,757 t CO2e) compared to the previous year, whilst electricity consumption (kWh) only fell by 2%. The reduction in scope 2 emissions is primarily due to a reduction in the electricity grid average conversion factor for 2018. As a result, our total absolute scopes 1 + 2 (combined) emissions in FY2018 fell by 19% (1,972 t CO2e) compared to the previous year.
Waste: The significant reduction in emissions from waste compared with the base year is due principally to changes in DEFRA / DECC's calculation methodology over the whole reporting period.
Quantification and reporting methodology
We have measured and reported our greenhouse gas emissions using the following guidelines, protocols, conversion factors and GWPs:
- Environmental Reporting Guidelines: Including mandatory greenhouse gas emissions reporting guidance – DEFRA (June 2013)
- WRI / WBSCD The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (Revised Edition)
- WRI / WBSCD The Greenhouse Gas Protocol: Corporate Value Chain (Scope 3) Accounting and Reporting Standard (September 2011)
- 2018 UK Government Conversion Factors for Company Reporting (Year: 2018, Expiry: 31/07/2019, Version 1.01) – Defra / DECC
- WRI / WBSCD The Greenhouse Gas Protocol: Scope 2 Guidance, An amendment to the GHG Protocol Corporate Standard (2015)
Whilst we have used the GHG Protocol Value Chain (Scope 3) Standard (see iv above), we are not yet able to report on all relevant categories. However, we have reported on those which we believe to be most relevant and material to our overall environmental impacts and carbon footprint.
Although EY is not currently required to comply with mandatory greenhouse gas reporting requirements under the Companies Act 2006 (Strategic and Directors' Reports) Regulations 2013, we have ensured that all scope 1 + 2 emissions sources required under such legislation have been included in this report and that our reporting is consistent with the relevant requirements.
We have used the financial control approach to identify the GHG emissions for which we have responsibility. The boundaries of our reported emissions comprise all locations operating in the United Kingdom, Northern Ireland, Channel Islands, Isle of Man and Republic of Ireland (except where noted as an exclusion). The emissions of Ernst & Young Global and Ernst & Young Global Services business units at these sites are not included in the emissions totals since they are separate legal entities and do not form part of the governance structure of Ernst & Young LLP.
We have measured our scope 1, 2 and significant scope 3 emissions.
We report all locations outlined in the organisational boundary as a collective total and do not currently break down emissions by country.
We have set our base year as 2009/10. Although we have been collating emissions data since 2003/04, the 2009/10 financial period was chosen as it was the first year in which:
- a full third-party verification of our carbon footprint data was carried out, and
- the first time we were able to include our non-travel related significant scope 3 emissions (i.e. waste, paper consumption).
During this time we also carried out an extensive review of our data quality, scope and emissions calculation methodologies, the outcomes of which have been applied consistently since then. As such 2009/10 provides a fixed base year from which we measure both our absolute and normalised performance going forward.
We will recalculate all emissions from the base year to the reporting year in the event that either:
- changes occur which meet the recommended recalculation criteria outlined in 'Environmental Reporting Guidelines: Including mandatory greenhouse gas emissions reporting guidance – DEFRA (June 2013)', Chapter 1 – Step 5 – Action ii, or
- ii) changes occur which equate to or exceed a 5% deviation (positive or negative) from previously calculated data.
For our UK&I (including FS) operations, we set annual targets in each of our key areas of environmental impact, all of which are designed to reduce our overall GHG emissions intensity (i.e. scope 1, 2 & significant scope 3 emissions) and contribute to our global sustainability goals.
Read an overview of our objectives and targets.
Lynn Rattigan (Chief Operating Officer) is the member of our UK&I Leadership Team responsible for achieving these targets.
As a professional services firm, our products and services are intellectually based. Emissions arise as a result of our office locations and through our client teams’ business travel. We use both a financial emissions intensity metric (t CO2e per £m revenue) and a headcount intensity metric (t CO2e per FTE) to normalise our data and provide meaningful performance indicators.
Scope 1 + 2 emissions: For our buildings, the material source of emissions is energy consumption (scopes 1 + 2) which is significantly influenced by the number of people occupying our office space (via cooling / heating demand, catering, media displays and on-desk power supplies etc.). In FY2018, energy consumption (kWh) per FTE fell by 0.42% compared to the previous year, whilst related CO2e emissions (t CO2e per FTE) fell by 16%. This was due to two influencing factors:
- From 1 January 2018 EY switched from natural gas to renewable biomethane gas (biogas) for all sites where it procures gas energy. The biogas supplied is certified under the Green Gas Certification Scheme and attracts a significantly lower scope 1 emissions conversion factor than natural gas.
- Although total electricity consumption did decrease slightly (2%), the scope 2 electricity UK grid average conversion factor for 2018 fell by 19% compared to 2017.
As we continue to re-fit and refurbish office environments in line with our ‘EY@Work’ strategy, we expect future reductions in energy intensity from continuing investment in upgrades to plant, equipment, lighting etc.
Scope 3 emissions: The vast majority of our scope 3 emissions are from business travel. In FY2018, scope 3 business travel emissions per £m revenue increased by 12% compared to the previous year. This is primarily due to a significant increase in air travel which we believe is in part due to a relaxation of the restrictions and authorisation processes for business travel as well as our service lines’ increased focus on delivering against business targets. However, we are continually developing our travel booking processes to include awareness of ways to reduce environmental impact, and encouraging our employees to 'travel smarter' through better journey planning and increased utilisation of flexible working practices / remote working technologies.
Assurance specialists from our client-facing Climate Change & Sustainability Services (CCaSS) team conduct an annual audit of our environmental data collation and calculation processes and produce an assurance statement summarising the level of accuracy and inclusivity, with recommendations for improvement, which we proactively seek to adopt. Read an overview of the assurance statement.
At EY, we do not offset our carbon emissions. We believe the best way to mitigate the effects of climate change is to reduce emissions at source rather than indirectly offseting them via projects outside EY. We look for ways to reduce GHG emissions generated by our business operations and invest in a variety of long-term sustainability measures. Examples include an extensive energy efficiency capital investment programme, the use of renewable electricity (where consumed in EY controlled buildings, and appropriate tariffs are available from our energy suppliers) as well as expanding our network of travel alternative technologies (eg, video conferencing facilities). This approach is integrated into our overall business strategy, and forms part of our environmental management system, which is certified to ISO 14001.
Woodland Carbon Units
EY did not buy or retire any Woodland Carbon Units during the reporting period.
- Electricity purchase for own use or consumption: 24,724 MWh
- Renewable electricity generated from owned or controlled sources: 0 MWh
- Electricity exported to the grid: 0 MWh
With the exception of natural gas combustion for heating in our own offices we have not generated any heat.
When reporting emissions related to our electricity consumption, the appropriate years' DEFRA / DECC UK electricity conversion factors have been applied to all electricity purchased, including those from renewable sources, non-renewable sources and those where the source is unknown e.g. landlord-supplied electricity.
However, since October 2007 EY has purchased renewable tariff electricity for all UK offices where we can control the energy supply and appropriate tariffs are available. In addition, since January 2018 we have purchased renewable biogas instead of fossil-fuel based natural gas. We buy renewable energy because we believe in supporting renewable energy markets by creating demand and in living our values by 'doing the right thing'. 100% of the electricity and biogas we procure from our suppliers is backed by recognised certification schemes (i.e. REGOs, GGCS), which provide evidence that the energy is from appropriately accredited renewable sources.
We have accounted for the purchase of renewable electricity through our market-based reporting of emissions in line with the GHG Protocol's updated Scope 2 Guidance.
Market-based scope 2 emissions reporting
The above data is consistent with reporting methodologies used in previous years and uses a location-based approach for the calculation of scope 2 emissions. However, EY buys renewable electricity as part of its energy procurement strategy and as such also calculates scope 2 emissions using a market-based approach. These calculations have only been carried out for FY2015 electricity data onwards. This is because the new WRI GHG Protocol guidance (see 'Quantification and reporting methodology' above) was only published in 2015, so was not available until then.
EY has an electricity procurement contract in place in the UK with Smartest Energy for all half-hourly (HH) and non half-hourly electricity, which is 100% renewables-backed. Smartest Energy guarantees that 100% of the electricity it supplies to EY's offices is generated from renewable sources. It has purchased this energy from renewable generators and allocated an equivalent number of Renewable Energy Guarantee of Origin (REGO) or Guarantee of Origin (GoO) certificates to EY. REGO / GoO certificates are recognised by Ofgem to demonstrate that electricity has been produced from renewable sources within a defined period. Each certificate covers one MWh of energy generated.
Our scope 2 emissions using the market-based approach total 4,683 tonnes, compared with 7,185 tonnes using the location-based approach. In calculating these emissions, we have taken the conservative approach since there may or may not be other energy procured for EY offices that meets the criteria.