Engage & Inspire
EY net-zero initiatives help clients, suppliers, and the planet
By Julian Ryall
Of all its sustainability and corporate social responsibility initiatives, Ernst & Young Global Ltd. (EY)—along with American Chamber of Commerce in Japan (ACCJ) Corporate Sustaining Member company EY Japan—is particularly proud of its ambitions in the area of carbon emissions. And rightly so.
In late January, the company unveiled plans to build on its NextWave strategy, first announced in 2020, and become carbon negative this year. That is to be achieved by setting targets to significantly reduce absolute emissions across the company, as well as removing and offsetting more carbon than the global organization emits.
If that were not enough, the seven key components of the plan are designed to reduce EY’s total emissions 40 percent and achieve net-zero emissions as early as 2025. That percentage is consistent with a science-based, greenhouse gas-reduction target to cut an organization’s emissions in line with climate science and the goals set in the 2015 Paris Agreement to limit global warming to 1.5 degrees Celsius above pre-industrial levels.
The campaign has become an integral part of EY’s NextWave strategy, designed to create long-term value for all stakeholders and support the company’s plan to build a better work environment.
“We believe that combating climate change is a vital element of building a better working world,” said Carmine Di Sibio, EY global chairman and chief executive officer, in a statement.
Being carbon-negative will not only “engage and inspire” the present workforce … it “will also build EY member firms’ reputations as employers of choice.”
“While this challenge is unique and different for each organization, we are inspired by those that are setting ambitious targets, despite the difficulties they face,” he said. “EY people are passionate about tackling big challenges and, with the power of 300,000 of them, we will not only transform EY to become a leader in sustainability but also help EY clients do the same.”
Leading by Example
The main tenets of the plan are broad in their scope and ambitious in their reach. They could also hold lessons for other companies looking to follow in EY’s green footsteps.
On a global basis, the company aims to reduce business travel emissions 35 percent by fiscal 2025 from the fiscal 2019 baseline. It estimates that air travel accounted for 75 percent of its total carbon emissions in 2019. Solutions include using virtual collaboration technologies and adopting new tools and tech to help staff make better travel choices and encourage greener alternatives whenever possible.
A reduction of 35 percent in travel-related emissions translates to a cut of more than two million tons of CO2 between 2019 and 2025.
The company will also narrow its overall electricity usage and is committed to procuring 100 percent of its energy needs from renewable sources by 2025. This achievement will earn EY membership in the RE100, an organization that brings together more than 300 of the world’s most influential companies, all of which rely on renewable sources for 100 percent of their electricity needs.
Implementation of innovative ways of working has already enabled EY to reduce its real estate occupancy figure from 13.8 square meters per person in 2009 to 7.6 today. That has resulted in a decline in power consumption of more than 150 kilotons of CO2 equivalent, which matches the annual energy use of 17,830 homes or 612 million kilometers (380 million miles) driven by average passenger vehicles.
In addition, EY is structuring its electricity supply contracts through virtual power purchase agreements with solar and wind farms to introduce more than twice the amount of electricity that it consumes into national grids from 100 percent renewable energy. That will offset the company’s office electricity emissions, reduce total electricity costs, and help to decarbonize the electricity generation sector.
Under the scheme, EY teams will have the tools that enable them to calculate, and then work to reduce, the amount of carbon emitted when carrying out work for EY clients. And the feedback from clients has been positive, the company told The ACCJ Journal, with many saying they want to work even more closely together to reduce the collective impact on the planet.
Furthermore, EY has set suppliers the goal to meet their science-based targets by no later than 2025 and is committed to working with those companies to help them meet the goals.
Collaborative Support
The seventh and final element of the program is premised on the belief that the biggest difference that EY can make is to help clients on their journeys to decarbonize their businesses. This move creates value for all stakeholders through sustainable action, including financial value for their investors. EY is increasing investments in the services and solutions that will make the company a global leader in sustainability, including in its Climate Change and Sustainability Services teams, as well as its strategy, consulting, and tax service lines.
Announcing the initiative, Steve Varley, vice-chairman of EY Global, said that, “EY has set this ambition because it is increasingly clear that, collectively, we need to do even more to help avert a climate change disaster.
“EY people are proud that we met our ambition to become carbon neutral in 2020,” he said. “Inspired by them, and others undertaking major steps, we challenged ourselves to go further, faster.
“We are deeply concerned about the science and what that means for our planet,” Varley added. “We believe that becoming carbon negative in 2021 and net zero in 2025, reducing our emissions in line with a science-based target, is the right ambition to have.
“We realize that these challenges are different and more difficult for certain industries. That is why there are also investments in new solutions and services to help EY clients protect and create value by becoming more sustainable, too.”
Making a Difference
As well as helping the planet and generations to come, EY is confident that it will help the company in the more immediate future. Being carbon-negative will not only “engage and inspire” the present workforce, the company said, but it “will also build EY member firms’ reputations as employers of choice, attracting talent who increasingly want to work for responsible businesses.”
To further bolster the company’s commitment to reducing its environmental impact and driving sustainable growth, EY has recently launched two initiatives: one with the Sustainable Markets Initiative set up by His Royal Highness The Prince of Wales, and another with the S30, a forum of 30 C-suite sustainability leaders divided into three working groups that focus on accelerating business action on sustainability. Further, the company has joined the Terra Carta, a green recovery charter for business. Launched by The Prince of Wales earlier this year, it places sustainability at the heart of the private sector.
EY is also playing a leading role in the sustainability conversation in the World Economic Forum’s International Business Council, which has drawn up a core set of common metrics and disclosures on non-financial factors for investors and other stakeholders.
EY was the first of the big four accounting firms to become carbon neutral. The other three have set 2030 as their net-zero target year. Achievements to date put EY in the same bracket for world-class sustainability leadership as fellow ACCJ member companies Microsoft, Google, Salesforce, and IKEA.
THE JOURNAL
Vol. 58 Issue 5
A flagship publication of The American Chamber of Commerce in Japan (ACCJ), The ACCJ Journal is a business magazine with a 58-year history.
Christopher Bryan Jones, Publisher & Editor
