Sustainability

Spending money on sustainability is not just a cost. It is an investment in the long term success of our businesses. Sustainable practices do not just protect the environment. They make good business sense and are capable of generating long term value.

In 2011 we formed an energy committee within the sustainability committee to facilitate the exchange of environmental know how within the Group. Our sustainability-focused committees and working groups enable business units to share resources and best practices and to make plans for the attainment of our zero net environmental impact goal.

Swire Pacific's Carbon Footprint

Cooperation with Other Groups

We try to keep ourselves informed about the latest developments in environmental protection. By joining advocacy groups, we learn from them and offer our own experience to them. Internationally, we are a member of The Climate Group (www.theclimategroup.com) and in 2011 joined more than 400 other companies in signing the 2C Challenge Communique (www.2degreecommunique.com), urging governments to establish a comprehensive international framework to tackle climate change. In Hong Kong, we are a member of the Business Environment Council (www.bec.org.hk) and the Climate Change Business Forum (www.climatechangebusinessforum.com) and are a platinum patron of the Green Building Council (www.hkgbc.org.hk).

Our Carbon Footprint

In 2011, our greenhouse gas (GHG) emissions were 16.9 million tonnes of CO2e, 5% more than in 2010. The Aviation Division is responsible for 97% of our total GHG emissions. In 2011, the Aviation Division's GHG emissions increased by 5% to 16.4 million tonnes of CO2e.

To achieve net zero impact on the environment, we must reduce our carbon footprint. It is therefore a priority for us. We must first measure our current carbon footprint. We measure our GHG emissions and report them (and the actions which we are taking to reduce them) annually to the Carbon Disclosure Project (www.cdproject.net).

Carbon Footprint of Our Beverages

In 2010 and 2011, the Beverages Division participated in an assessment under the Greenhouse Gas Protocol Initiative (www.ghgprotocol.org). The assessment analysed the carbon footprint of Coca-Cola and Coca-Cola Zero drinks packaged in returnable glass, PET and aluminium containers.

Carbon Offsetting

What is Carbon Offsetting?

When you cannot reduce your own carbon emissions,you can reduce somebody else's by buying a carbon credit. You can also earn carbon credits by doing things which absorb carbon dioxide from the atmosphere.

A zero carbon footprint is not possible now. Carbon offsetting can help an organisation to move towards a net zero carbon footprint.

Cathay Pacific introduced its FLY greener carbon offset programme in 2007, enabling its passengers to buy offsets. The programme has supported hydropower projects and a wind turbine farm in Mainland China. By the end of 2011, Cathay Pacific had offset 98,000 tonnes of carbon dioxide.

Swire Pacific Offshore's Forest Conservation Scheme in Paraguay

Swire Pacific Offshore (SPO) is reducing its carbon footprint by participating in a REDD+ (Reducing Emissions from Deforestation and Forest Degradation - www.un-redd.org) forest conservation scheme in Paraguay. This scheme is expected to generate one million tonnes of carbon credits by 2030, making SPO carbon neutral over the period to 2030. The scheme can be expanded, enabling SPO to generate carbon credits for other business units.

Fuel Efficiency

We use a lot of fossil fuels, particularly in aviation, so our GHG emissions are our biggest environmental challenge. We try to improve fuel efficiency and limit our emissions (including by more efficient use of fuel) through operational improvements and use of new technologies.

The airlines do their best to minimise fuel consumption, for example by buying new more fuel efficient aircraft and by traffic management. As they fly more, so the airlines' emissions increase. Biofuels may help - see below.

We are using more electric vehicles. HAECO and Swire Properties operate electric vehicles. The Beverages Division is phasing out its pre-Euro 4 standard vehicles and replacing them with Euro 5 standard vehicles, which emit less carbon dioxide and pollutants.

In 2011, Hong Kong Airport Services Limited (a subsidiary of Cathay Pacific) started to use a loader at Hong Kong International Airport which can be powered by electricity or diesel. Using dual power loaders can reduce tailpipe emissions by up to 40% and energy costs by up to 35%.

Biofuels

Most biofuels are derived from organic matter such as plants. Plants absorb carbon dioxide as they grow. This compensates in part for the carbon emissions which result from the consumption of biofuels. First generation biofuels are produced from food crops. Second generation biofuels are produced from residual biomass and biological waste.

Cathay Pacific supports the development of sustainable fuels. It is involved in the formation of the Sustainable Aviation Fuel Users Group Asia. Using biofuels would reduce our airlines' reliance on fossil fuels. However, using food crops to produce biofuels can adversely affect food and drinking water supplies, biodiversity and people. We are looking at biofuels derived from non-food crops, agricultural residues and waste material which would otherwise go to landfills.

Energy Efficient Buildings

The Group's second-largest source of greenhouse gas emissions is the electricity which is used in its buildings. We own and/or manage approximately 29.4 million square feet of principally commercial space. Making buildings more energy efficient is a priority.

Energy Efficiency as a Design Requirement

Energy efficiency is a key design requirement for all our new buildings. Before design starts, efficiency targets are set. The design is evaluated against these targets. After construction, energy efficiency is tested and continues to be tested during a building's life.

Water Consumption

In 2011, the Group's total water consumption was 8.0 million cubic metres, up 6% from 2010. Swire Beverages accounted for 75% of this, using water to make beverages and to maintain hygiene.

In 2008, the Beverages Division conducted a water risk assessment in Mainland China. Water of the right quality should continue to be available in the short term, but shortages are likely in some parts of Mainland China by 2025. The division is therefore developing measures intended to ensure sustainable water supplies for its Mainland China plants.

The Beverages Division's water motto is 'Reduce, Reuse and Replenish'. This means reducing consumption, returning recycled and treated waste water to the environment at a level that supports aquatic life and replenishing the communities with the same amount of water we use in our finished beverages. The aim is for all plants to return all the water which they use to make beverages back to the water supply system by 2020.

The bottling plant in Zhengzhou supplies the municipal authorities with treated wastewater, which is used for filling a man-made lake. This saves over 200 million litres of fresh water annually. The Zhengzhou plant discharged no wastewater in 2011. The design of the new bottling plant in Luohe incorporated water management features. The plant was given a platinum rating under the US Green Building Council's LEED rating system, the first Coca-Cola plant to be given such a rating. Other plants are introducing comparable features.

Waste

The world produces too much waste. Hong Kong for example produces over 13,000 tonnes of waste per day, putting pressure on landfills.

Packaging

Businesses need to design, manufacture and package their products with a view to minimising waste. Changes in the design of the plastic bottles used by the Beverages Division have reduced waste.

Waste as a Resource

A lot of waste can be reused. In 2010, HAECO installed an absorption chiller unit powered by spent fuel from aircraft, aiming at turning waste into energy and reducing electricity usage. TAECO treats and recycles 230 tonnes of wastewater per day. The recycled water is used for flushing toilets, irrigation, apron cooling and cleaning floors, vehicles and aircraft. Cathay Pacific Catering Services gives fruit peelings and leftover food to a local pig farm.

Noise

Noise pollution is a challenge for our airline operations. Cathay Pacific endorses the International Civil Aviation Organisation's balanced approach to controlling noise emissions around the airport. This approach focuses on reducing noise at source, regulating land use around airports, adapting operational procedures and implementing operating restrictions. We work with the Hong Kong Civil Aviation Department on noise mitigation and with manufacturers and others on ways to reduce the noise made by our aircraft.

In 2011, we were fined five times for noise infringements at London's Heathrow Airport and received noise infringement notifications from airports in Frankfurt and Brussels. We are working to improve our performance through better planning and aircraft deployment.

The Swire Institute of Marine Sciences (SWIMS)

SWIMS was built with a donation from The Swire Group Charitable Trust in 1990. The institute conducts marine science experiments. Much of the research undertaken looks at how species respond to environmental and man-made stresses. Funding for a similar marine station to be operated by Xiamen University was announced in April 2011.

Aims for 2012

  • To streamline the collection, reporting and monitoring of information.
  • To explore opportunities to increase energy efficiency, to generate carbon credits and to conduct internal carbon trading.
  • To seek opportunities to invest in biofuels and other alternative energy technologies.

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