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Getting Momentum on Sustainability

Getting Momentum on Sustainability. Steve Lee United Group Limited. Getting Momentum with Sustainability. Steve Lee Group Manager HSSE. Getting momentum…. Big city lights…. Influences…. Risk: Climate Change. No Action Reasonable Action Substantial Effective Action Radical Action.

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Getting Momentum on Sustainability

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  1. Getting Momentum on Sustainability Steve LeeUnited Group Limited

  2. Getting Momentum with Sustainability Steve Lee Group Manager HSSE

  3. Getting momentum…

  4. Big city lights….

  5. Influences…

  6. Risk: Climate Change • No Action • Reasonable Action • Substantial Effective Action • Radical Action Likelihood Consequence

  7. Sustainable Development To meet the needs of the present without compromising the ability of future generations to meet their own needs." United Nations World Commission On Environment & Development Improving operating efficiencies Reducing the company carbon (ecological) footprint i.e. reduce use of energy, materials, water, waste

  8. Business imperative Why integrate sustainability into the business? • Investment groups with increasing expectations • Compliance to current and emerging legislative requirements • Compliance to current and emerging company reporting requirements • Large company demand & competitors adopting progressively • Opportunities for product and service • Opportunities to improve internal efficiency • Potential for positive marketing influence

  9. Business as usual…! In the context of the businesses we are involved with… • Electricity use – eg lighting, fixed equipment, air conditioning, hot water • Fuel use – eg petroleum, diesel • Green house gas contribution - LPG gas, CO2, • Consumption – paper, air travel, bulb replacement, petrol, etc • Resource use – eg water, • Waste output reduction, recycling • Impact of ETS on prices of energy • Financial impact/increase – rising power & fuel costs, • Identify environmental impacts in current operational facilities.

  10. Australian response so far… • Energy Efficiency Opportunity (EEO) Act (2006)Federal Govt – Dept focussed to improve their energy efficiency on top ASX high energy consuming businesses & industries using over 0.5 Petajoules (PJ) of energy (electricity & gas sources) per year. Required to evaluate & publicly report on cost effective energy saving opportunities. • National Greenhouse and Energy Reporting (NGER) Act (2007)Federal Govt – Dept of Climate Changefocussed on establishing a single, national system for reporting greenhouse gas emissions, abatement actions, and energy consumption and production by Australian Corporations from 1 July 2008. • Australian Emissions Trading Scheme Legislation in 2009focused on implementing ETS. • Reporting on Carbon Disclosure and Corporate ResponsibilityIncreasing demand by investment organisations requiring more information to accurately evaluate company non-financial related performance with respect to sustainable development and corporate governance.

  11. Australian response so far… • Energy Efficiency Opportunity (EEO) Act (2006) • National Greenhouse and Energy Reporting (NGER) Act (2007). 2008 0.50 PJ energy (=125,000 T CO2 ) 2009 0.35 PJ energy 2010 0.10 PJ energy

  12. Progress to ETS Reduce Australia’s GHG emissions by 60% by 2050

  13. Sustainable Development

  14. Direct & Indirect Effects Direct effects of a Price of Carbon Upstream Pressures • Suppliers will pass on cost of carbon • Materials – particularly those with high energy inputs such as cement, aluminium, steel • Electricity – liability of electricity producers, power rates increase • Fuel suppliers – potential increased costs from upstream liability • Certain materials may develop higher demand because of use in low emission activities • The development of the ethanol industry in Australia may push up the price of sugar • Potential increased competition for forest resources because of forest sink activities or biomass fuel source Increase price of timber • Switching to gas from coal as a higher energy source • Solar energy capturing materials,

  15. Direct & Indirect Effects Indirect effects of a Price of Carbon Downstream Demands • Customers want products and services with lower costs. Carbon price impact on energy costs gives incentive to purchase low emissions products and services to avoid a carbon liability on your business. • Environmental sustainability demands • Rise of carbon neutral and emissions reduction programs in the corporate world • Companies that have made carbon neutral pledges include HSBC, Swiss Re, IAG and NewsCorp • Companies will increasingly want products and services that help reduce their carbon footprint • Large companies exerted pressure on their supply chain eg WalMart working with manufacturers and freight service providers

  16. Carbon Management Strategy Some steps to take a reasonable response in assessing the risks and opportunities and developing a carbon management strategy: • Measure and monitor carbon footprint – your energy usage • Ensure carbon data is independently audited • Forecast carbon growth and set reduction targets • Assign costs to abatement opportunities • Report carbon data internally and externally • Create a senior carbon management position • Track competitor’s responses • Price carbon into investment decisions • Identify and leverage new carbon opportunities (avoid green-wash) • Review progress on carbon targets

  17. Progress to Date Working Group established - June 2007 Energy assessment data for UGL operations – Nov 2007 UGL Sustainability Program Paper – Feb 2008 Intranet – internal communication on sustainability – March 2008 Sustainability Manager initiated – May 2008 Sustainability Program commenced – May 2008 Collating current UGL activity and initiate both short and long term actions

  18. Key actions

  19. Summary • Identify your exposure to Federal Govt progress with EEO and business impact from the ETS • Assess the impact of projected energy costs increases on your business (cost to operating/manufacturing and price increase products) • Carbon reduction is a business efficiency issue • Carbon Management Strategy a good process to use • Broaden the efficiency assessment to include other resources you use • Define participation with your business units with efficiency initiatives • Employees need communication and participation opportunities • Evaluate if there are new business opportunities and impacts • Public company communication - prepare to adopt a corporate reporting standard ie Global Reporting Index (GRI) or similar

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