Key Performance Indicator:
Seek to reduce our environmental impact in all our locations by minimising the use of resources and wherever possible preventing environmental damage.
Prudential recognises that it has a responsibility to minimise the direct impact that it has on the environment, particularly where it is an employer. In practice, this means minimising the carbon intensity and resources we use and tackling the indirect impacts we have on the environment through our supply chain.
"Undoubtedly one of the biggest issues we are facing is that of climate change. Raising awareness amongst employees can play a key role in reducing resource use, whilst at the same time lowering emissions."
Andrew Wordsworth, Director, Business Development, Carbon Trust
What is our environmental impact?
As one of the UK’s largest property investment managers PRUPIM accounts for over 75 per cent of Prudential’s direct environmental impact in the UK and the US.
We believe that as one of the UK’s leading property investment managers, we have a significant responsibility for the environments and communities in which we operate. As part of our CR strategy we have developed a comprehensive set of actions to mitigate the impact our business operations have on the environment.
Environmental policy
The Group’s Environment Policy, first produced in June 2006, has been revised to reflect our increasing emphasis on carbon reduction. The revised policy was signed off by the CR Committee and its Chair, Philip Broadley, Group Finance Director and will now be re-communicated across the Group.
Climate change: UK climatewise principles
Prudential is one of 38 companies from the financial services sector to endorse the ClimateWise principles, launched on 13 September 2007. A working group of leading global insurers, reinsurers, brokers and asset managers developed the principles to promote positive action on climate change. They will enable companies and organisations throughout the world to build climate change into their business operations.
The principles, developed by the working group led by the Association of British Insurers, focus on: encouraging greater climate-friendly behaviour among customers and employees; integrating climate change into investment strategies and risk analysis.
Although we will be reporting our performance against the principles from a UK perspective, we will be working towards, where possible, a Groupwide reporting framework. For further information visit: www.climatewise.org.uk
Working with our peers through forge
FORGE is a consortium of financial institutions formed in 2000, to address the CR issues facing the financial services industry and develop a consistent approach towards managing them.
During 2007, FORGE developed a guidance framework and an Employee Engagement Actionpack which seeks to: progress understanding of climate change for the financial services sector; assist organisations to develop a response and provide practical advice on mitigating climate change across a financial services organisation, taking into consideration both individual functions as well as business units.
"Carbon management is a significant challenge to all businesses. At PRUPIM, we are continuing to address this important issue, with a number of projects already in place which will help us minimise our carbon emissions and manage our properties as effectively as possible."
Energy management, UK - Energy performance certificates of buildings
From April 2008, under the European Union Energy Performance of Buildings Directive, Energy Performance Certificates (EPCs) will be required for any building that is constructed, sold, or rented. EPCs will rate the energy performance of a building, enabling both property investors and prospective occupiers to consider energy efficiency ratings and levels of carbon emissions. Furthermore, EPCs will be accompanied by a report containing recommended measures to further improve the energy efficiency of a building.
Prudential will be introducing EPCs, initially in the UK, for both its commercial investment property portfolio and its occupied property portfolio. Prudential will implement the directive elsewhere in accordance with national regulations.
Martin Moore, Chief Executive, PRUPIM
Energy management, International
In the US, it has been agreed in principle that Jackson, PPM America, and PRUPIM’s North American investment properties participate in the US ‘Climate Leaders’ Programme.
Climate Leaders is an industry/government partnership that works with companies to develop climate change strategies. Partner companies commit to reducing their environmental impact by completing an inventory of greenhouse gas emissions, setting aggressive reduction goals and annually reporting progress. Through programme participation, companies create a credible record of their accomplishments and receive recognition as corporate environmental leaders.
It is also planned that the same portfolio participates in the US Energy Star Programme. This will help find smart ways to manage the energy needed to run our business to enhance overall corporate value. Energy Star advises that up to 30 per cent savings are achievable.
In Asia, a building services provider for the occupied property portfolio is being appointed. We plan to use the experience and knowledge of the provider to grade our buildings using a straightforward environmental classification system. We then intend to improve our overall environmental performance by, where possible and as opportunities arise, migrating to properties which are in the highest of these environmental categories.
Travel planning
To help minimise our carbon footprint, the business continues to review its travel plans. In Craigforth, Scotland, bus routes operate daily between the company’s site and a number of locations throughout the Forth Valley area to bring employees to work. Additionally, shuttle-buses to rail stations are also provided. Following a review of these services, efficiency has been improved and total mileage has been reduced by eight per cent compared to the previous reporting year (in 2006-2007 total transport mileage was 393,000 miles, carrying an average of 570 employees per day).
Travel planning in the US - Clean commute
Jackson is working in tandem with the Lansing Capital Area Transportation Authority (CATA) to offer employees the Clean Commute Options programme. The programme is dedicated to educating the community on alternatives to driving alone and improving air quality.
As a part of the Clean Commute Options programme, CATA provides a free ride-matching service to those interested in forming car or vanpools. CATA also provides free emergency rides for people who participate in the carpool/vanpool, so that they will never be without a ride to or from work. A number of employees have taken advantage of the programme and the overall response has been very positive.
Energy procurement in UK occupied properties
Buying energy from renewable sources helps to reduce our carbon footprint. We are committed to increasing the amount of renewable energy we buy.
In 2007, half of Prudential’s UK electricity consumption came from renewable sources, compared to two per cent previously. This move cut our CO2 emissions by more than 1,375 tonnes in comparison to 2006 (assuming consistent energy consumption).
Energy procurement in UK investment properties
Investment properties have continued to be supplied with a proportion of 'green' electricity (dependant upon the availability of supplies), representing 58 per cent of electricity supplied. (Data are based on billing information provided by our supplier Scottish and Southern for the reporting period of 1 October 2006 – 30 September 2007).
Engaging on future policy development
During 2007, the UK Government published a consultation on the proposed Carbon Reduction Commitment (CRC), a new mandatory emissions cap and trade scheme to reduce CO2 emissions from large, non-energy intensive commercial and public sector organisations, which make up 10 per cent of total UK emissions. We are actively consulting with the Government on the proposed CRC through the British Property Federation.
Sustainability development: a framework for decision making
During 2008, PRUPIM published: ‘Sustainable Development - a Framework for Decision Making’, to actively encourage and promote sustainable practices, with the aim of sharing its experience in the sustainability arena with the property industry as a whole.
PRUPIM worked with design, engineering and management consultants WSP, to develop the framework which is a ‘living’ document and will be regularly updated and extended.
Engaging our employees on climate change
Prudential’s Group Intranet site has a section for our employees to access a carbon calculator, enabling them to establish their domestic CO2 footprint, energy efficiency tips, and a feedback mechanism. This is part of our programme of educating our employees on issues around climate change.
"Responsible property investors are showing they can simultaneously meet their social and fiduciary responsibilities and are being rewarded in many instances through competitive or increased returns."
100 days of carbon clean-up
The 100 Days of Carbon Clean-up Campaign, run by the UK Chartered Institution of Building Services Engineers, aims to demonstrate the ability of an organisation to make a saving of CO2 emissions by implementing simple, low-or- no-cost measures over 100 days. The campaign, introduced at PRUPIM’s head office, encourages employee awareness and managerial initiatives to reduce carbon emissions from their buildings. The initiatives were also extended to the managed investment properties taking part in the first tranche of the ISO 14001 project and support PRUPIM corporate commitments towards lowering CO2 emissions and energy consumption.
Paul McNamara
Co-Chair of UNEP FI Property Working Group, and Head of Research at PRUPIM
Unep fi property working group
The United Nations Environment Programme Finance Initiative (UNEP FI) is a unique global partnership between UNEP and the financial services sector. PRUPIM is currently working with and co-chairing the UNEP FI Property Working Group, a platform of financial institutions that collaborate to drive sustainable development to the heart of mainstream property finance.
In 2007, the UNEP FI Property Working Group surveyed the major markets across the globe to identify the most robust examples of emerging and innovative responsible property investment being carried out. The findings demonstrated that ‘low and no cost’ and ‘value added’ approaches towards responsible property investing are the most financially sound.