Corporate Responsibility Report 2012 ECONOMIC SUSTAINABILITY ENVIRONMENTAL SUSTAINABILITY SOCIAL RESPONSIBILITY onedestination.co.uk April 2013 FOREWORD I see our Corporate Responsibility programme as a core part of our business strategy and playing a key role in helping to build a long term sustainable business. Aviation plays a critical role in the global economy through connecting people and communities enabling them to prosper and build better lives. At British Airways we are fully committed to playing our part in achieving sustainable growth through our One Destination Corporate Responsibility Programme. Our Corporate Responsibility programme and this report are organised along three dimensions: Economic sustainability, environmental sustainability and social responsibility in recognition that this has become the internationally recognised structure for managing and reporting on sustainability. We work closely with regulators at a national, European and International level to help develop appropriate regulation to support the sustainable growth of our industry. In particular, in relation to the important issue of climate change we support and welcome the progress made through the International Civil Aviation Organisation (ICAO) in developing a carbon standard for future aircraft and in prioritising efforts towards a global policy solution to enable Carbon Neutral Growth from 2020. We will continue to support these important activities. I believe that sustainable low-carbon fuels have great potential to reduce our carbon footprint and will contribute to the long term goal of a 50 percent reduction in net CO2 emissions by 2050. Keith Williams CEO, British Airways 2 British Airways Corporate Responsibility Report 2012 I am proud of the progress we have made with our technology partner Solena to build Europe’s first biomass to liquid biojet plant in London. We are also committed to ensuring that our operations and the aircraft we purchase will enable us to continue to reduce the environmental impacts on the local communities who live close to the airports we serve both in the UK and around the world, particularly in relation to the issue of aircraft noise. Our flagship charity programme, Flying Start with charity partner Comic Relief goes from strength to strength having raised over £4.5 million since its launch in 2010, with over £1.9 million raised in 2012 alone. I truly believe that through actions like these we can create a sustainable aviation industry allowing global communities the opportunity to continue to enjoy the incredible benefits that come from flying, and enable British Airways to set the standard for responsible air travel. CONTENTS FOREWORD2 3.4 CLIMATE CHANGE 24 CONTENTS 3 3.5 FLEET AGE AND RENEWAL 34 ABOUT THIS REPORT 4 3.6NOISE 35 1INTRODUCTION 5 3.7 AIR QUALITY 36 1.1 WHO WE ARE 6 3.8 WASTE AND RECYCLING 37 1.2 KEY CORPORATE RESPONSIBILITY IMPACTS 7 3.9WATER 39 1.3 HIGHLIGHTS OF 2012 8 3.10 LOCAL INITIATIVES 40 9 1.4AWARDS 4 SOCIAL RESPONSIBILITY 41 1.5 CR GOVERNANCE 10 4.1 SOCIAL CONTEXT 42 1.6 RISK MANAGEMENT 11 4.2 OUR SOCIAL GOALS 42 1.7 STAKEHOLDER ENGAGEMENT 12 4.3 OUR SOCIAL OBJECTIVES 43 2 ECONOMIC SUSTAINABILITY 15 4.4 CUSTOMER EXPERIENCE 45 2.1 ECONOMIC CONTEXT 16 4.5 BRAND VALUES AND MANAGEMENT 46 2.2 OUR ECONOMIC GOALS 17 4.6 EMPLOYEE RELATIONS 47 2.3 OUR ECONOMIC OBJECTIVES 17 4.7 RESPONSIBLE PROCUREMENT 51 4.8 COMMUNITY INVESTMENT 52 4.9WELLBEING 58 4.10 SAFETY 59 4.11 DIVERSITY AND INCLUSION 60 2.4 FINANCIAL PERFORMANCE OF BRITISH AIRWAYS AND IAG 18 2.5 FINANCIAL RISK MANAGEMENT AND BUSINESS RESILIENCE 19 2.6ONEWORLD AND JOINT BUSINESSES 20 2.7 OPERATING EFFICIENCY AND PUNCTUALITY 20 3 ENVIRONMENTAL SUSTAINABILITY 21 3.1 ENVIRONMENTAL CONTEXT 22 3.2 OUR ENVIRONMENTAL GOALS 22 3.3 OUR ENVIRONMENTAL OBJECTIVES 22 5APPENDICES 64 5.1 REPORT SCOPE 65 5.2 DATA CALCULATION AND METHODOLOGY 66 5.3DATA 67 FOREWORD AND CONTENTS 3 ABOUT THIS REPORT We publish the British Airways Corporate Responsibility Report annually, for a diverse group of stakeholders. The reporting period is defined as the calendar year 1 January to 31 December – in line with financial reporting standards. Our reports are Insert available online at www.onedestination.co.uk. fact here One Destination is the name given to our Corporate Responsibility programme. This report supplements the financial and corporate governance reporting found in the International Airlines Group Annual Report 2012 (published in March 2013) and covers British Airways’ economic, environmental and social commitments. This report is structured to meet some of the requirements of the Dow Jones Sustainability Index, the Global Reporting Initiative, and the Carbon Disclosure Project. The first section of the report provides an overview of corporate responsibility (CR) at British Airways, what we have determined to be our key CR impacts and how they are linked to business strategy – and describes how we work with our key stakeholders. The second section deals with economic sustainability, financial and efficiency performance, and British Airways’ contribution to the broader economy. The third section deals with environmental sustainability, which covers all of British Airways’ main environmental initiatives, as well as our performance regarding emissions, noise and waste. 4 British Airways Corporate Responsibility Report 2012 The fourth section deals with social responsibility. This includes reporting on British Airways’ activity with our charity partners, a breakdown of our community and social projects, and details of how we manage relations with our customers and colleagues. The fifth and final section of the report contains appendices, including reporting methodology, and a list of data indicators. The information in this report has been approved by the senior management of British Airways, including the Corporate Responsibility Board, and all quantitative data has been assessed by British Airways Internal Audit. During the reporting period, there were significant changes to British Airways operations in and around our London Heathrow hub. This was mainly due to the acquisition of British Midland International (bmi), in April 2012. Full integration of the bmi operation into British Airways mainline was completed in November 2012, and where this has affected reporting, it has been noted. 1: INTRODUCTION 1 INTRODUCTION 1.1 WHO WE ARE 6 1.2 KEY CORPORATE RESPONSIBILITY IMPACTS 7 1.3 HIGHLIGHTS OF 2012 8 1.4AWARDS 9 1.5 CR GOVERNANCE 10 1.6 RISK MANAGEMENT 11 1.7 STAKEHOLDER ENGAGEMENT 12 1: INTRODUCTION 5 1.1 WHO WE ARE British Airways is one of the world’s leading premium airlines, and the largest international scheduled airline in the United Kingdom. We aim to fly our customers to airports in the best locations, at the most convenient times. Including our partner airline Iberia, subsidiaries, joint businesses, codeshares and franchise partners, British Airways serves over 400 destinations around the world. British Airways is a subsidiary of International Consolidated Airlines Group S.A (IAG), which was created in 2011 by a merger between Iberia and British Airways. IAG is a Spanish-registered company, with shares traded on the London Stock Exchange and Spanish Stock Exchange. In the 12 months up to December 2012, British Airways carried 36.7 million passengers, compared to 34.0 million in 2011. As of the 31 December 2012, our global workforce totalled 41,315 staff, compared to 39,295 the previous year. Our employees are spread across the following areas: Our principal place of business is London, where we have a significant presence at Heathrow, Gatwick and London City airports. Our corporate headquarters are at Waterside, just outside Heathrow. UK & Ireland 85.2% Europe 3.4% Americas 4.8% Africa & ME 1.5% 6 British Airways Corporate Responsibility Report 2012 Asia Pacific 5.0% 1: INTRODUCTION 1.2 KEY CORPORATE RESPONSIBILITY IMPACTS British Airways has investigated and prioritised its main challenges, risks and impacts regarding sustainability. We operate in a global sector that is unique in the value it generates for our customers and wider society. However, we need to balance this economic value against the environmental impacts of aviation, with the aim of improving the sustainability of the sector. The European airline industry, and British Airways in particular, currently faces the following challenges: • Continuing economic uncertainty in the Eurozone, combined with record unemployment in some of our key markets. • Lack of a concerted global agreement on climate change. • Continuing competitive pressure from low-cost carriers. • Congestion of European airspace as a whole, and in particular limited capacity at our London Heathrow hub. • Volatility in fuel markets. • Increasing competition from Far East and Middle Eastern airlines on key long haul routes. Responsible aviation starts with safety and security, and that is British Airways’ fundamental duty to its customers and colleagues. But our responsibility agenda also spans the impact we have on the environment, how we treat our customers and colleagues, and how we work with the communities we serve and operate within. British Airways recognises that the airline industry as a whole can take steps to reduce its carbon footprint, and thereby protect its right to grow responsibly. We have consistently promoted the introduction of carbon pricing using the cost effective emissions trading Based on these challenges, as well as risks identified through our risk-mapping activity at IAG and British Airways, we have identified the following as our key impacts in terms of corporate responsibility: • Economic Financial performance Alliances and joint business agreements Operating efficiency • Environmental Emissions associated with climate change Noise and air quality impacts Consumption of resources Waste and recycling • Social Charity partnerships and community investment Employee relations, engagement and support Brand management and customer experience Customer safety Employee safety Inclusion and diversity Responsible procurement instrument to ensure our industry can achieve global climate change goals. Over the coming years we will continue to implement initiatives to improve our carbon efficiency. Through partnerships with Solena and Rolls Royce, British Airways is also working to accelerate the use of biofuels in the aviation industry. We will continue to support community projects in the UK and other countries we operate in, and build on the fundraising achievements of Flying Start, our flagship charity partnership with Comic Relief. 1: INTRODUCTION 7 1.3 HIGHLIGHTS OF 2012 THE LONDON OLYMPIC AND PARALYMPIC GAMES Hundreds of British Airways employees were involved in making the London Games one of the most successful Olympics in history. IMPROVEMENTS TO OUR SERVICE FOR DISABLED CUSTOMERS Our flagship Disability Assistance Programme was implemented successfully during the summer. LAUNCHED OUR FIRST ONE DESTINATION CARBON FUND PROJECTS The fund is supported by donations from our customers, and the latest low-carbon project to open in 2012 was the Fenham community swimming pool in Newcastle. PROGRESS ON A GLOBAL CLIMATE DEAL Implementation of the EU Emissions Trading System for aviation was delayed, allowing governments to progress talks towards developing a global solution to climate change. SELECTED TECHNOLOGY PROVIDERS FOR GREENSKY BIOFUEL PROJECT We have committed to buy the jet fuel produced by the plant for ten years, valued at US$500 million. CORPORATE RESPONSIBILITY WEBSITE We launched our new Corporate Responsibility website at www.onedestination.co.uk ACQUISITION OF BRITISH MIDLAND INTERNATIONAL This has given us the opportunity for growth at our Heathrow hub. FLYING START CHARITY PARTNERSHIP RAISED OVER £1.9 MILLION IN 2012 Flying Start is our charity partnership with Comic Relief UK, which has now raised over £4.5 million since the partnership began in 2010. UPGRADED EXISTING FLEET We refurbished and upgraded some of our Boeing 767 and 777 aircraft, enhancing the customer experience and extending the lives of the aircraft. 8 British Airways Corporate Responsibility Report 2012 1: INTRODUCTION 1.4 AWARDS FOREST FOOTPRINT DISCLOSURE PROJECT Awarded as sector leader for the third year running. British Airways was the first airline to participate in the programme. BUSINESS TRAVELLER AWARDS 2012 Best airline. Best short haul carrier. Best business class. Best frequent flyer programme. WORLD AIRLINE AWARDS Awarded Best Transatlantic Airline. GREEN FLAG AWARD Awarded for the management of Harmondsworth Moor, the area surrounding British Airways corporate headquarters at London Heathrow. The Award recognises well-managed, high quality green spaces that offer free and open access to the public. BUSINESS TRAVEL AWARDS 2013 Award for best Corporate Social Responsibility programme, for One Destination. Awarded in January 2013 for CR activities in 2012. WILDLIFE TRUST DIVERSITY BENCHMARKING AWARD Awarded in recognition of our team of rangers’ excellent work at Harmondsworth Moor. 1: INTRODUCTION 9 1.5 CR GOVERNANCE Our corporate responsibilityInsert (CR) strategy is a core part of British Airways’ overall factstrategy, here where we aim to set the standard for responsible air travel. The Corporate Responsibility Board (CRB) is the primary body overseeing all aspects of our CR programme. The CRB comprises members of the British Airways Board, and is chaired by non-executive director Gavin Patterson. Other members include British Airways CEO Keith Williams, members of the British Airways Board and senior Leadership Team, as well as nonexecutive directors Alison Reed and Ken Smart. British Airways’ CR programme, One Destination, is managed directly by the British Airways Environment team, with the main working groups supported by relevant organisational representatives that focus on specific CR activities. We have multiple, discrete working groups with specific responsibilities to achieve our CR goals. The table below shows each working group with responsibility for CR, all of which report directly to the CRB. Familiarisation with these instructions is required for all managers, and the instructions cover issues such as business conduct and ethics, bribery and corruption, staff concerns, and environmental policies. “Successful companies recognise they have wider responsibilities than simply generating shareholder returns, and leading companies know that corporate responsibility actually adds to long-term value. British Airways has made tremendous progress with its corporate responsibility agenda, continuing to further embed sustainability into the core of the company’s business strategy, and is recognised as a leader in promoting long-term solutions to address climate change, delivering customer service excellence and sustained support for communities around the world. At British Airways we also formalise our approach to Corporate Responsibility through a series of Standing Instructions. The policies in these Instructions outline key company rules which govern the management and control of the British Airways Group. These achievements, together with the programme that is documented in this report, are testament to a company at the leading edge of its industry. But there is always room for improvement, and through the Corporate Responsibility Board we will continue to provide challenge and guidance across the airline’s CR programme, further developing all aspects of its sustainability and responsibility performance.” Gavin Patterson Chair of the British Airways Corporate Responsibility Board CR Governance Structure Environmental Compliance Flying Start Manage environmental risk and compliance across the airline Manage principal charity partnership and support other charitable organisations Fuel Efficiency Group Improve the fuel efficiency of the airline’s flight operations Climate & ETS Strategy Group Manage climate change and emissions trading strategy Corporate Responsibility Board Chaired by non-executive director Gavin Patterson 10 British Airways Corporate Responsibility Report 2012 CR Senior Sponsors Group Promote and champion CR issues within directorates 1: INTRODUCTION 1.6 RISK MANAGEMENT The CEO and the British Airways Board require that all areas within the company use effective risk management strategies. British Airways uses integrated multi-disciplinary risk management processes, which help prioritise investment to enable the delivery of corporate goals, and identify risks linked to economic, social and environmental responsibility. The British Airways Board has assigned responsibility for the risk management programme to the Risk Group, which comprises members of the Leadership Team. With support from Risk Leaders from each business area, the Head of Corporate Risk and Compliance – who is directly responsible for the administration and coordination of the corporate risk process – also supports the Risk Group. A risk register records and measures all risks, including those related to CR, identified by the Risk Group. The main register is owned by the Head of Corporate Risk and Compliance, and sub-registers are kept in each department. Responsibility for maintenance and regular reviews of the risk registers lies at departmental level. These five categories help us assess all risks related to CR at a company level, and show the business areas most exposed to individual risks. Consequently, corporate risks are assigned to the business areas most likely to be affected, who then have responsibility for managing activities across the company to mitigate these risks. For example, Operations ‘owns’ the risk of operational disruption due to extreme weather. To determine risk materiality, or priorities British Airways uses four primary criteria: • Risk impact – the risk’s potential financial impact. • Probability – the likelihood of the risk happening. • Velocity – how quickly the risk could occur. • Timeframe – how soon the risk could arise. These corporate risk processes (including CR risks) produce regular reports, which are all distributed directly to the British Airways Leadership Team and the audit board of IAG. The scope of British Airways’ risk management is structured around five key risk categories: 1.Strategic risks – that could affect the success of the business strategy. 2.Operational risks – that may affect business operations. 3.Financial risks – which might affect the financial health of the business. 4.Compliance risks – those arising from issues relating to legislative requirements. 5.“Iceberg” risks – low probability but highimpact, business-critical issues. 1: INTRODUCTION 11 1.7 STAKEHOLDER ENGAGEMENT Media Customers Communities (UK and abroad) Shareholders International civil aviation authorities Employees Engagement Channels CR Annual Report One Destination website Conferences Direct meeting/engagement CR Seminar Environment Debates Media The travel market Suppliers NGOs Regulators Partner organisations Governments Other airlines Our stakeholders 12 British Airways Corporate Responsibility Report 2012 Industry groups and associations 1: INTRODUCTION As a global business, British Airways has a wide variety of stakeholders. Our engagement work is critical in enabling key stakeholders to understand what we do, and provide a mechanism to provide feedback on our initiatives and activities. On noise related issues, we built a constructive relationship with the Heathrow Association for the Control of Aircraft Noise (HACAN), and are working with their representatives and industry partners to introduce a range of noise mitigation measures. Our engagement work also enables us to develop our understanding of the economic, environmental and societal impacts of our business and how these are changing over time, and to engage with relevant partners, regulators and industry bodies so as to ensure we continue to develop and improve our approach to sustainability. In May 2012 we launched our dedicated Corporate Responsibility website at www.onedestination.co.uk This is just one of the ways we can communicate with our stakeholders on CR issues, and it gives them a valuable forum for giving feedback on our CR programme. The website also contains copies of our current and previous CR reports that are available to download. We ensure this engagement work remains focused on those issues of most relevance to our stakeholders by regularly reviewing material issues. We do this in a range of ways (as outlined in the diagram on the previous page) as well as directly polling our customers, running focus groups, through supporting NGOs, and through Materiality Surveys conducted by the John Madejski Centre for Reputation. The most recent of these surveys was commissioned in late 2012, and is due to report in 2013. In October 2012, over 140 guests attended our Annual Corporate Responsibility Seminar. Guests included representatives of our key corporate customers, government officials, members of the local community, NGO representatives, and British Airways colleagues. The audience heard presentations on key topics and future trends for CR, and gave us their feedback on issues they feel British Airways should be addressing as part of our CR programme, One Destination. We communicate directly with stakeholders on CR issues in a variety of ways. These include articles and features in our customer and employee magazines, and updates on our One Destination website. We provide CR information for our investors through the IAG Annual Report and Accounts, and separately through this British Airways Annual Corporate Responsibility Report. IAG executives also meet regularly with key investors. We also communicate CR issues internally with our colleagues through a structured programme of activity led by senior sponsors from each department. In November 2012, we held an Environment Debate, focusing on achieving sustainable growth in aviation, particularly in the context of the need for new hub airport capacity in the UK. This was the most well attended CR event we have run to date, with over 180 guests from a wide range of stakeholder groups, the aviation industry and British Airways. The debate included contributions from a respected panel of experts, including representatives from Greenpeace, WWF, the Aviation Environment Federation, airline industry and airport infrastructure experts, and the CEO of IAG, Willie Walsh. In 2012 we made progress on several fronts. Notably, this included engaging directly with corporate customers as part of their own responsible procurement programmes, which has led to closer cooperation with our key corporate customers on a range of CR issues and initiatives. British Airways’ focus on CR is increasingly important to our customers, including leisure travellers, small and medium businesses, and large corporate organisations. It is clear from research and engagement with stakeholders, that those companies which have a clear and open commitment to CR have a greater chance of building successful long-term relationships with their customers. Throughout the year we continued extensive discussions with non-governmental organisation (NGO) stakeholder groups, international regulators, and industry groups on climate change policy. 1: INTRODUCTION 13 1.7.1 Employee rewards linked to corporate responsibility Next Steps All British Airways managerial staff are entitled to pay rewards linked to company performance (including social and environmental performance) as in the table below. We aim to recognise and reward any employee who contributes significantly to CR performance, through: • One Destination Awards – an annual award event held to recognise CR and environmental performance achievements of staff, including carbon reduction activities. • Engineering Awards – an annual award event held to recognise the accomplishments of engineering staff, including environmental performance achievements. • Enhance customer engagement on CR issues • Work with our key corporate customers and stakeholder groups • Continue our programme of internal engagement and activity through Senior Sponsors in each department • Hold further facilitated CR events, and attend those hosted by our key stakeholders • Continue to develop the functionality, look and feel of our One Destination website • Lean Continuous Improvement Awards – an annual award event held to recognise continuous improvement projects across the whole airline, including those with the potential to reduce emissions and improve carbon efficiency. Managerial reward Business Area Form of reward Assessment procedure Monetary Assessment of key performance indicators achieved, and linked to British Airways’ main environmental/ social priorities Public affairs managers Facilities managers Environmental managers Business unit managers Energy managers Senior management group Engineering specialist managers 14 British Airways Corporate Responsibility Report 2012 2: ECONOMIC SUSTAINABILITY 2: ECONOMIC SUSTAINABILITY 2.1 ECONOMIC CONTEXT 16 2.2 OUR ECONOMIC GOALS 17 2.3 OUR ECONOMIC OBJECTIVES 17 2.4 FINANCIAL PERFORMANCE OF BRITISH AIRWAYS AND IAG 18 2.5 FINANCIAL RISK MANAGEMENT AND BUSINESS RESILIENCE 19 2.6 ONE WORLD AND JOINT BUSINESSES 20 2.7 OPERATING EFFICIENCY AND PUNCTUALITY 20 2: ECONOMIC SUSTAINABILITY 15 2.1 ECONOMIC CONTEXT Aviation provides employment, trade links, tourism and support for economic development through air travel. The global air transport industry supports 56.6 million jobs worldwide and in 2011, contributed $2.2 trillion to global GDP – equivalent to 3.5 per cent of GDP*. These figures, produced by the Air Transport Action Group (ATAG), do not include other economic benefits, such as the economic activity made easier by air travel that would not otherwise be possible, and the value that the speed and connectivity of air travel provides. increased productivity by encouraging investment, innovation and efficiency. British Airways also invests substantially in aviation infrastructure. Unlike other sectors, the air travel sector pays for nearly all of its own infrastructure, instead of relying on taxation and public funds. As a member of one of the largest airline groups in the world, British Airways contributes significantly to global economic prosperity. Aviation plays a vital supporting role in economic growth, particularly in developing countries, by increasing access to international markets and the availability of the benefits of globalisation. The global airline industry continues to consolidate, and significant progress was made in 2012 with the purchase of bmi by IAG and its subsequent integration into British Airways. Since its creation in 2011, IAG’s economic strategy has been to add value through consolidation, improve industry stability and sustainability, and to continue increasing product choice and quality of service for all its customers. The connectivity airlines provide, which can’t be met by alternative means of transport, contributes to * source: Air Transport Action Group, aviationbenefitsbeyondborders.org 16 British Airways Corporate Responsibility Report 2012 2: ECONOMIC SUSTAINABILITY 2.2 Our Economic Goals Financial performance Deliver consistent revenue growth, operating profits, and cost synergies, as part of the IAG business plan. Partnerships Continue to develop new partnerships with other airlines, and strengthen our existing alliances and partnerships. Operating performance Provide consistent outstanding service to customers through excellent operating performance and efficiency. 2.3 Our Economic Objectives Objective Targets Progress in 2012 Make the most of the growth opportunities afforded by the acquisition of bmi, and maintain a focus on costs. Contribute to an operating profit at IAG of €1.6 billion by 2015, and keep nonfuel costs flat. British Airways delivered an operating profit of £274 million, and succeeded in keeping non-fuel costs flat. Our parent company IAG made a small operating loss of €23 million for the year. Provide choice and flexibility for customers, and improve revenue for British Airways through airline partnerships and commercial innovation. Continue to strengthen our Joint Business Agreements and extend the reach of the oneworld network in key markets. Announced a new joint business route operated between Europe and Japan, with Japan Airlines. Sponsored the addition of Air Berlin to the oneworld alliance. Secured future growth through the acquisition of 42 slots at our hub in Heathrow, through the purchase of British Midland International (bmi). * source: Air Transport Action Group, aviationbenefitsbeyondborders.org 2: ECONOMIC SUSTAINABILITY 17 2.4 FINANCIAL PERFORMANCE OF BRITISH AIRWAYS AND IAG sustainability, economic performance, and the success of the oneworld alliance. The drop in profits from 2011 to 2012 at British Airways can be attributed to the losses incurred by the acquisition of the bmi airline, as well as increasing fuel costs. Formed in 2011, International Consolidated Airlines Group S.A (IAG) is the third-largest airline group in Europe and the sixth largest in the world by revenue. It is a global group with a significant presence across five continents, and ideally placed to serve markets in North America, Latin America, Asia and Africa, from two of Europe’s most important hubs – London Heathrow and Madrid Barajas. Since 2011, IAG customers have benefited from reduced costs, greater choice, and seamless transfers between British Airways and Iberia services. The group now handles more than 54 million passengers every year. Synergies During 2012, British Airways continued to identify and deliver cost synergies with partner airline Iberia, and we have outperformed the second year cost and revenue synergy targets. We have therefore raised our revenue and cost target for the five-year programme (2011 to 2015) from €500 million to €560 million. Since 2011 we have delivered cost and revenue synergies of €313 million. During 2012, both IAG’s operating airlines – British Airways and Iberia – faced tough challenges in several areas, so the strong results delivered at our London base have been vital to the group’s ongoing British Airways performance Operating profit 2010* 2011 2012 £342 million £518 million £274 million International Airlines Group performance 2011 2012 Total revenue €16.3 billion € 18.1 billion Operating profit €485 million - €23 million *nine months to December 2010 British Airways capacity 2010 Revenue passenger km (millions) Available seat km (millions) Cargo tonne km (millions) 18 British Airways Corporate Responsibility Report 2012 2011 Year on year change (2011-12) 2012 106,082 117,348 126,436 7.7% 136,721 150,152 158,247 5.4% 4,593 4,793 4,891 2.0% £274m 2: ECONOMIC SUSTAINABILITY operating profit in 2012 2.5 FINANCIAL RISK MANAGEMENT AND BUSINESS RESILIENCE British Airways is exposed to economic risks beyond those of many other businesses. Enterprise Risk Management structures and processes are drawn up at strategic and operational levels, and linked directly to the economic and financial issues affecting air travel. Our risk assessment process takes into account the severity and frequency of risks, and their potential effects on the business. IAG treasury also carries out financial risk management, which includes identifying, evaluating and hedging financial risks, as approved by the Board. The Board also sets out principles for overall economic risk management, as well as area-specific policies that include: British Airways has an internal Business Resilience team as part of the Operations Directorate, which coordinates and exercises crisis management and contingency planning for all levels of incident and disruption. The team also operates the crisis management centres and helps manage operational disruptions according to established procedures. Crisis management centres are vital for responding to customers needs, maintaining brand reputation, business continuity and for informing continuous improvement during disruption-free periods. British Airways’ Emergency Procedures Information Centre (EPIC) is recognised as a centre of excellence, and contracts its services to several other airlines. • Foreign exchange risk. • Interest rate risk. • Credit risk. • Derivative financial instruments. • Investment of excess liquidity. €313m synergies delivered 2: ECONOMIC SUSTAINABILITY 19 2.6 ONEWORLD AND JOINT BUSINESSES The oneworld alliance includes 12 of the world’s most respected and highest quality airlines. It offers business travellers one of the most attractive global networks, and as a member, British Airways can extend its route network and earn revenue beyond its own areas of operation. The alliance network covers 155 countries, and its members operate over 8,800 flights every day. • In June 2012, Sri Lankan Airlines was elected as a member designate, sponsored by Cathay Pacific, with the intent to become a full member within the next 12 months. Air Berlin joined the oneworld family in 2012, and Malaysian Airlines joined at the beginning of 2013, giving the alliance a greater presence in one of the world’s fastest growing regions for air travel. Our joint business agreements with American Airlines and Iberia have been benefiting customers and shareholders since 2010, and allow the oneworld alliance to operate on a level playing field with the Star and Skyteam alliances. In 2012, a new joint business agreement was set up with Japan Airlines to share revenue on applicable flights between Europe and Japan – effective from October 2012. These agreements expand codeshares with partner airlines, allow the sharing of revenue, and the coordination of schedules, fares, and network planning. Other developments include: • British Airways subsidiary Openskies joined oneworld in November 2012 as a member affiliate. • In October 2012, Qatar Airways announced its intention to join the oneworld alliance, sponsored by British Airways. • In May 2012, all flights operated by bmi became part of the oneworld network, before the airline became part of British Airways. 2.7 OPERATING EFFICIENCY AND PUNCTUALITY British Airways optimises its operating performance through improved fleet management and assignment, flight scheduling, and aircraft and route use. 79.9 percent of the flight capacity we offered in 2012 was used (load factor), compared to 75.9 percent in 2011. Our punctuality scores – as measured, according to industry standards, by the number of flights leaving within 15 minutes of the published departure time – fell slightly in 2012 to 79 percent, compared to 83 percent in 2011. 79.9% load factor in 2012 20 British Airways Corporate Responsibility Report 2012 3: ENVIRONMENTAL SUSTAINABILITY 3 ENVIRONMENTAL SUSTAINABILITY 3.1 ENVIRONMENTAL CONTEXT 22 3.2 OUR ENVIRONMENTAL GOALS 22 3.3 OUR ENVIRONMENTAL OBJECTIVES 22 3.4 CLIMATE CHANGE 24 3.5 FLEET AGE AND RENEWAL 34 3.6 NOISE 35 3.7 AIR QUALITY 36 3.8 WASTE AND RECYCLING 37 3.9 WATER 39 3.10 LOCAL INITIATIVES 40 3: ENVIRONMENTAL SUSTAINABILITY 21 3.1 ENVIRONMENTAL CONTEXT British Airways is committed to addressing its environmental responsibilities. We recognise that although air travel is vital to the economic and social welfare of the UK and other countries we fly to, our operations have an impact on the environment. As part of our wider business strategy, we aim to set the standard for responsible air travel, and we have a comprehensive programme of initiatives and targets designed to alleviate our key impacts on the natural environment. Sustainable business growth requires us to fully address our environmental impacts, both globally and locally. Leadership and collaboration is vital in achieving our goals, across our industry and with our regulators. As part of this, we participate in stakeholder groups such as Sustainable Aviation in the UK, the European Leaders of Sustainable Biofuels, the International Air Transport Association (IATA) Environment Committee and the International Civil Aviation Organization (ICAO) Committee on Aviation Environmental Protection. 3.2 Our environmental goals Climate change Reduce net carbon dioxide emissions through a cap on emissions from 2020 (Carbon Neutral Growth), and a 50 percent cut in net CO2 emissions by 2050 relative to 2005. Noise and air quality Minimise effects of noise and air quality in local communities. Waste and recycling Minimise waste, reduce disposal to landfill and increase reuse and recycling. 3.3 Our environmental objectives Objective Targets Progress in 2012 Advocate a responsible global regulatory approach to the aviation industry on climate change that is cost-effective and minimises market distortions. Collaborate with IATA to develop and promote pragmatic policy recommendations for a global economic measure by June 2013. Substantial work through an IATA task force towards a preferred industry package for achieving Carbon Neutral Growth from 2020. Press for the EU ETS to evolve in a way that avoids distortions and disputes. The EU has applied a welcome pause in the implementation of the EU ETS on intercontinental flights, to give time for ICAO to make progress on a global approach. 22 British Airways Corporate Responsibility Report 2012 3: ENVIRONMENTAL SUSTAINABILITY Objective Targets Progress in 2012 Accelerate the implementation of sustainable low-carbon fuels into the aviation industry. Work with low-carbon fuel developers to implement sustainable supply chains for alternative fuels, before 2020. Selection of key technology partners for GreenSky London. Influence UK and EU regulators to establish positive incentives for sustainable low-carbon aviation fuels. Published paper through SAFUG on incentives for sustainable biojet fuel. A 25 percent improvement in carbon efficiency from 111g CO2/pkm in 2005 to 83g CO2/pkm in 2025. 101.9g CO2/pkm in 2012. Improve carbon efficiency through a programme of targeted initiatives. Novel biofuels test programme entered rig and engine test phase with Rolls-Royce. We are the only airline member of the Leaders in Sustainable Biofuels partnership. 2015 interim goal: 97g CO2/pkm. 48,000 tonnes CO2 reduction due to aircraft fuel efficiency initiatives in 2013. Delivered 39,336 tonnes CO2 savings due to fuel efficiency improvements. A 5% reduction in ground energy use in our buildings for 2013 against our new 2012 baseline. Achieved 2007 target to reduce ground energy consumption by 20% over five years. Reduce the effects of climate change along our supply chain. 2012 sector leader in the Forest Footprint Disclosure Project (FFDP). Improve information for, and discussion with, customers on climate change issues. Provide scheme for customers to support low-carbon initiatives. Launched One Destination Carbon Fund (ODCF) project in Weymouth, UK. Introduce quieter aircraft and new operating procedures to reduce noise. Reduce average noise per flight by 15% by 2015. Due to delays in the delivery of our new Boeing 787 and Airbus A380 aircraft, we now expect to meet this target in 2018. Increase recycling. 60% recycling by 2015 at our main bases of Heathrow and Gatwick. 45% of waste recycled at Heathrow and Gatwick. Increase level of recycling of onboard waste. Launched segregation of aluminium cans on short haul flights out of Heathrow. Secured additional funding support for ODCF through Big Society Capital. Trials of aluminium can segregation on long haul flights into Heathrow. 3: ENVIRONMENTAL SUSTAINABILITY 23 cap on emissions from 2020 supporting global regulation 3.4 CLIMATE CHANGE Climate change is our most significant and urgent sustainability issue. The vast majority of our climate impact (approximately 99 percent) results from greenhouse gas emissions released through the burning of fossil-based jet fuel in aircraft engines. The international community’s aim is to limit greenhouse gas concentrations in the atmosphere so that global temperatures do not increase by more than 2°C by 2050. We want to ensure the aviation industry makes a fair contribution towards achieving this aim. Climate change goal: These goals have been adopted by the entire aviation industry, as part of its proposal for a global approach to aviation emissions. Reduce net carbon dioxide emissions through a cap on emissions from 2020 (Carbon Neutral Growth), and a 50 percent cut in net CO2 emissions by 2050 relative to 2005. CO2 emissions British Airways is pursuing all avenues to meet these goals. While we have direct influence in operational measures, choice of aircraft technology, and sustainable fuels, we are also involved in lobbying governments to take action on infrastructure improvements, and to accelerate introduction of global economic measures. To meet our targets, and avoid market distortions, globally coordinated government action is essential – for example, in implementing economic measures, simplifying airspace, setting technology standards and incentivising the use of sustainable fuels. The diagram below illustrates the CO2 savings associated with elements of our climate change strategy that will ensure our goals are met. Climate target: 50% cut in net CO2 Illustrative emissions growth with no action after 2010 nology raft tech cy New airc l efficien na io at & oper Sustainable low 2020 target: -carbon fuels Demand reductio Purcha n se of e missio other ns red sectors uction throug s in h carb on trad ing 2050 target: 50% cut in net 2050 emissions target: Cap on net emissions 2010 2020 The ‘New aircraft technology & operational efficiency’ area represents savings from new fuel-efficient aircraft and operational improvements. 2030 2040 2050 Year The ‘Sustainable low-carbon fuels’ area represents the benefit from using new low-carbon fuel. The ‘Purchase of emissions reductions’ area represents the emissions reductions made in other sectors through carbon trading. The ‘Demand reduction’ area represents the reduction in flying due to the inclusion of carbon costs in airfares. The lowest line is the net emissions level achieved once all emissions reduction actions are in place. Our climate change objectives: • Advocate a responsible regulatory approach to the aviation industry on climate change – one that is cost-effective and minimises market distortions. Our climate change objectives: • Accelerate the implementation of sustainable low-carbon fuels into the aviation industry. 24 British Airways Corporate Responsibility Report 2012 • Improve carbon-efficiency through a programme of targeted initiatives. • Improve information for, and discussion with, our customers on climate change issues. 3: ENVIRONMENTAL SUSTAINABILITY 3.4.1 A responsible global regulatory approach on climate change We support global regulation of aviation emissions through multilateral agreement at the International Civil Aviation Organisation (ICAO). We call on governments to introduce a cost-effective global economic measure to cap net aviation emissions at 2020 levels. We support a 50 percent reduction in net carbon emissions by 2050, relative to 2005. Through the International Air Transport Association (IATA), British Airways has helped to develop practical solutions to help governments prepare global climate regulation. From 2013, we believe governments should adopt a framework for states that wish to apply economic measures for reducing aviation emissions, based on the carbon trading principle, that is applied equally to all airlines. The framework would establish a system of rules for states to follow in applying these economic measures, and should include: • clarity on the geographic scope a state could apply measures within • agreement that all airlines flying a route would face equal treatment, regardless of nationality • confirmation that the carbon trading concept is by far the most cost-effective approach to establish carbon pricing • standardised administrative requirements, such as how aircraft emissions are measured, and the types of flights to be included. We believe governments should, by 2020, have collectively agreed a single global economic measure to supersede national and regional approaches. In addition to the elements listed above, a global measure would: • Ensure the industry’s environmental targets are achieved • Define equitably individual operators’ compliance responsibilities • Take into account states’ special circumstances and respective capabilities • Enable centralised reporting and compliance assurance. There are currently more and more uncoordinated, environmentally ineffective national and regional measures that will most likely cause unintended distortion in markets. This results in airlines facing higher climate policy costs than others in the same market. Governments must act urgently and collectively to avoid such a damaging patchwork of regulations for aviations emissions – with meaningful and concrete steps to a global approach through ICAO. The EU Emissions Trading System (EU ETS) The EU ETS has been temporarily amended for 2012 compliance, to cover only flights within Europe. We welcome this amendment, since it removes the risks of retaliation and competitor non-compliance. The amendment also offers a window of opportunity for governments to make progress towards a global agreement for aviation emissions. British Airways is a longstanding advocate of carbon trading as the most effective economic measure to help reduce emissions in the aviation sector. We believe an appropriately implemented EU ETS can be an important step towards a global regulatory framework. We are well placed to meet the EU ETS compliance requirements, having supported and participated in emissions trading systems since 2002. Next Steps • Work with industry partners and stakeholders to promote meaningful progress from governments towards a global deal at the ICAO General Assembly in September 2013 • Continue to develop and promote practical proposals for the design of global economic measures 3: ENVIRONMENTAL SUSTAINABILITY 25 3.4.2 Sustainable low-carbon fuels Although we have seen many improvements and innovations in jet engines over recent years, the aviation sector will be dependent on liquid hydrocarbon fuels for many decades to come. Over the last five years, there have been significant advances in the development of bio-based synthetic fuels. These fuels have now been approved by the relevant standards authorities and can be blended with conventional kerosene to fuel our aircraft. British Airways is committed to the development of sustainable lowcarbon aviation fuels and we are advocating: • The prioritisation of advanced fuels manufactured from biogenic wastes and residues, which avoid the land use change impacts that are associated with crop-based fuels. • The work of the Roundtable on Sustainable Biomaterials (RSB) who have developed the most robust project-based sustainability standard for biofuels. • The introduction of standards to mitigate Indirect Land Use impacts such as the one proposed for Low Indirect Impact Biofuels (LIIB) being developed by Ecofys, EPFL, and the World Wildlife Fund (WWF). • Greater harmonisation of standards with respect to sustainability and life cycle assessment of lowcarbon fuels to ensure that these take account of the full life cycle impacts of fuel production. • Lobbying governments to ensure that sustainability criteria are uniformly applied to all biomass based products, not only bioliquids. • Ensuring that a level playing field is provided by governments, so that aviation fuels are included in relevant policy frameworks and incentives. There was solid progress during 2012 on several projects that are exploring the possibilities for manufacturing advanced low-carbon fuels. However, full commercial production is still some time away, and is hampered by a lack of a coherent policy on aviation fuels at European and UK levels. To enable production on a larger scale, governments need to provide equivalence with road transport fuels within any incentive mechanism. We are collaborating with a number of industry groups to progress this important work towards achieving a more sustainable aviation sector: • The EU Flightpath programme with DG Energy aims to build production capacity in Europe to produce two million tonnes of sustainable aviation fuels by 2020. • The Sustainable Aviation Fuels Users Group (SAFUG) – a global group comprising 26 airline 26 British Airways Corporate Responsibility Report 2012 members together with Boeing and other manufacturers – is promoting advanced low-carbon fuels for aviation. • British Airways has also joined with Leaders of Sustainable Biofuels, a European group of second generation biofuels producers committed to developing more advanced fuels from wastes, residues and non-food crops. • In the UK, the Sustainable Aviation group is working to develop a biofuels roadmap for the deployment of low-carbon fuels in the future. British Airways and Solena Greensky project GreenSky London is our flagship project to construct a state-of-the-art facility that will convert around 500,000 tonnes each year of waste normally destined for landfill – into 50,000 tonnes of sustainable lowcarbon jet fuel, 50,000 tonnes of biodiesel, 20,000 tonnes of bio-naphtha and 11MW of exported power. By using biomass waste to produce fuel, the project will help reduce the amount of waste sent to landfill. The plant’s zero waste philosophy means all materials from the process have an end use. As well as the lowcarbon fuels produced, bio-naphtha can be used to make renewable plastics or blended into other fuels, and the process also produces a solid aggregate-type material. In addition, exhaust gases from the process will be captured and cleaned to yield gases of industrial quality. The process will generate approximately 11MW net of green renewable power that can be fed into the UK National Grid. The project has maintained momentum during 2012, thanks to the selection of key technology partners and the pre-front end engineering and design (Pre-FEED) for the project has commenced. Solena Fuels Corporation will provide the high temperature gasification process that converts waste matter into synthesis gas, and the overall Integrated Biomass Gasification to Liquids (IBGTL) solution. Solena is a sustainable energy company that has developed proprietary gasification technology as the initial processing block to create the highest value bio-based synthetic fuels. Oxford Catalysts Group/Velocys will supply the innovative Fisher-Tropsch (FT) reactors and catalyst that facilitate a highly efficient conversion of the cleaned synthesis gas into liquid hydrocarbons. The AIM-listed Oxford Catalysts Group are specialists in catalyst technology and Fischer-Tropsch reactors. British Airways has committed to buying the jet fuel produced by the plant for ten years, equating to US$500 million at today’s prices. We will also be an investor in the project. The British Airways off-take 3: ENVIRONMENTAL SUSTAINABILITY Low-carbon fuels These gases are cooled and cleaned Residential and commercial organic waste input Extremely high temperature plasma breaks down the waste into simple gases Input: Waste Process: Gasification agreement represents the largest advanced biofuel commitment made to date by an airline. Barclays has been appointed as advisor to explore the funding opportunities through export credit agencies. A Competitive Letter of Interest has been obtained from an agency and includes associated term funding. The British Airways and Solena partnership project represents a significant investment in new green technology in the UK. It will help reinforce the UK’s position as a technology innovator, while providing leadership in the area of sustainable green energy and low-carbon fuel solutions. GreenSky London has signed an exclusive option on a site for the facility, and consent work for the site has begun. The facility will create over 150 operational jobs, and 1,000 construction positions. We aim to have completed construction by 2015. British Airways and Rolls Royce alternative fuels programme In 2012, the British Airways Rolls-Royce novel fuels programme entered the rig and emissions testing phase. The programme, supported by the US Federal Aviation Association’s CLEEN (Continuous Lower Energy, Emissions and Noise) framework, aims to help the aviation transport sector fund additional sustainable fuels for aviation. The testing is to evaluate new, sustainable alternative fuels with the potential to be included in national and international aviation fuel specifications. Fuels for testing have been selected based on their novelty in terms of end product, process or their feedstock relative to fuels currently being certified. The partners initially chose eight fuel suppliers to provide fuel samples for laboratory testing, which was completed during 2011. The initial results suggested these fuels are strong candidates for certification. We have selected four fuels to undergo more in-depth The FischerTropsch process re-forms the gas into low-carbon jet fuel, as well as other useful substances Low-carbon jet fuel (kerosene) Biodiesel which is suitable for road vehicles A solid material which is used as aggregate in the construction industry Process: Re-forming Electricity and heat Output: Jet Fuel testing at Sheffield University, where compatibility with aircraft fuel systems, impact on engine operation and emissions profiles have been assessed. In testing, we have also varied the levels of aromatic compounds in the fuels to measure the effects on seal performance and emissions. Interim results are within the expected performance boundaries of conventional kerosene. British Airways has also provided a 737 Auxiliary Power Unit (APU) to Sheffield University for combustion and emission testing. We will share the results with the wider aviation community as part of our commitment to furthering scientific and technical understanding of the potential of sustainable fuels. Assessing the sustainability of early-stage bioenergy technologies is not well researched, so the project has been working with the Roundtable on Sustainable Biofuels (RSB) and the UK’s National Non Foods Crop Association. The project is using the RSB standard to benchmark the sustainability performance and risks associated with these technologies. Next Steps • Work with Solena to progress the Greensky project through the planning and construction phase • Promote the inclusion of aviation fuels within existing EU policy to speed up the deployment of these fuels, through Flightpath 2020 and Leaders of Sustainable Biofuels • Conclude rig testing within the Rolls-Royce test programme on novel fuels, to assess their engine performance and emissions profiles, prepare and disseminate final report 3: ENVIRONMENTAL SUSTAINABILITY 27 our footprint in 2012 was 17.6 million tonnes of CO2 3.4.3 Carbon footprint The diagram below illustrates the carbon emissions associated with our business, including those from the broader supply chain. Properties Emissions from the use of electricity, natural gas, and gas oil at our offices, terminals, engineering, and cargo facilities. Ground vehicles & handling Flight Operations Over 99 percent of our emissions result from the burning of jet fuel by our aircraft Jet fuel production Energy required for oil extraction, refining, and transportation. Loading and preparing an aircraft for flight requires a fleet of ground vehicles, which burn diesel, petrol, gas oil or use an electric battery. 3rd-party freighters Cargo trucking Emissions from 3rd-party suppliers transporting cargo on behalf of British Airways. Transporting freight for customers requires fuel. Employees Onboard catering Business travel and daily commuting both require fuel and electricity use. Use of electricity, gas, refrigerants, and ground vehicle fuels by catering suppliers. Waste disposal Emissions from recycling processes, waste incineration or methane leaking from landfill. New in 2012 British Airways is committed to continually improving its carbon management approach. In 2012 – to more closely align with the Greenhouse Gas Protocol and the Carbon Disclosure Standards Board’s Climate Change Reporting Framework – our carbon reporting is now split into two distinct sections: • Emissions within our organisational boundary (Scope 1 and 2) • Emissions outside our organisational boundary (Scope 3) We also expanded our Scope 3 reporting in 2012, broadening coverage across our supply chain Our greenhouse gas emissions (Scope 1 & 2) Our total Scope 1 & 2 emissions for 2012 were 17,554,312 metric tonnes of CO2 as illustrated in the chart below. As over 99 percent of our emissions result directly from flying activity - increased activity or disruptions directly impact our greenhouse gas footprint. 28 British Airways Corporate Responsibility Report 2012 In 2012, British Airways purchased British Midland International (bmi) and integrated its aircraft into the British Airways fleet – resulting in a direct increase in absolute emissions. improving carbon management 3: ENVIRONMENTAL SUSTAINABILITY The emissions from British Airways’ operations are split across Scope 1 and 2 as defined in the Greenhouse Gas Protocol (see appendices for calculation methodology): Scope 1 – 99 percent Scope 2 – < 1 percent Emissions from energy consumed indirectly by British Airways, such as electricity use at our facilities produced off-site by our energy supplier. 2012: 17,452,882 metric tonnes of CO2 2012: 101,430 metric tonnes of CO2 Emissions from energy consumed directly by British Airways, such as burning jet fuel. From 2012 our Scope 1 emissions include all freighters flying on a British Airways flightplan and all six Kyoto gases. Scope 1 & 2 – Carbon dioxide (CO2) emissions Year 15.4 2010 16.6 2011 17.6 2012 0 14.5 15 15.5 16 16.5 17 17.5 18 18.5 CO2 (million tonnes) Our supply chain’s greenhouse gas emissions (Scope 3) For the first time, we are reporting Scope 3 emissions from jet fuel production, business travel, catering and waste disposal. The chart below shows the emissions from each element of our supply chain in log scale. 3,623,514 633,240 Fossil upstream 3rd-party flying 8,829 Caterers 1,787 Fuel trucking 361 Business travel - road 85 Business travel - flying 44 40 36 Waste – landfill gases Waste – incineration Waste – recycling 10,000,000 1,000,000 100,000 10,000 1,000 100 0 tonnes of CO2 in logarithmic scale Key: Fossil upsteam: energy required for the upstream extraction, refining, and transportation of jet fuel. B usiness travel – flying: emissions from employee travel on non-British Airways flights. 3rd-party flying: refers to emissions from carriers transporting goods on behalf of British Airways, primarily cargo freighters. It also includes 2012 emissions from bmi fleet prior to their integration into the British Airways fleet. Caterers: Our Heathrow-based long-haul caterer. Fuel trucking: emissions from ground vehicles of logistics companies which transport jet fuel on our behalf. B usiness travel – road: emissions from employee travel by personal vehicle captured in mileage claims. Waste – landfill gases: waste which is non-recyclable and unfit for incineration is sent to landfill. The decomposition of waste produces greenhouse gases (primarily methane) which leaks into the atmosphere. Waste – incineration: emissions from incinerating nonrecyclable materials to generate heat and electricity. Waste – recycling: emissions from energy use required to recycle waste materials. 3: ENVIRONMENTAL SUSTAINABILITY 29 3.4.4 Carbon efficiency British Airways is committed to a carbon efficiency improvement of 25 percent by 2025 against a 2005 baseline – down to 83g CO2 per passenger kilometre (CO2 per pax km). In 2012, our carbon efficiency performance continued to improve, down to 101.9g CO2 per pax km. Carbon efficiency – performance and targets (grammes of CO2 per pax-km) Year 110.8 110.2 110.3 107.3 106.1 103.3 102.1 101.9 2005 2006 2007 2008 2009 2010 2011 2012 2013 2015 2017 2019 2021 2023 2025 101.9 2012 efficiency 97.0 2015 target 83.0 2025 target 97.0 83.0 40 60 80 100 120 grammes of CO2 per passenger kilometre Next steps • Prepare to comply with mandatory carbon reporting for UK-listed companies, as required by the Companies Act (in accordance with the 2008 Climate Change Act) • Facilitate expanded, robust carbon reporting by implementing a sustainability data management system in autumn 2013 • Review our carbon reduction targets, including modelling of expected efficiency improvements for new aircraft, fuel efficiency initiatives, and low-carbon fuels 30 British Airways Corporate Responsibility Report 2012 reducing paper-based manuals in cockpits 3: ENVIRONMENTAL SUSTAINABILITY Aircraft fuel-efficiency The Environment Team manages British Airways’ Fuel Efficiency programme, with a governance structure that incorporates several different areas of the operation: • Engineering • Customer • Operations Next Steps • Invest in a data management and monitoring tool that will help us deliver further fuel and carbon savings, through the provision of more timely and accurate data • Start to introduce lighter trolleys and unit load devices (ULDs) for our cargo operations • Flight operations • Cargo • Property • Fuel Ground energy • Operational research British Airways policy is to use energy responsibly across our global property portfolio. In April 2007, we set a target to reduce our energy consumption on the ground by 20 percent over five years. We planned to achieve this by: A Fuel Efficiency Coordination group within each operational area manages the day-to-day activities and management of individual projects. All Coordination groups report to a Steering Group that deals with any issues, selects new projects and promotes fuelefficiency within the company. The Steering Group comprises senior managerial staff, and reports directly to the Corporate Responsibility Board, which in turn provides independent oversight of all aspects of Corporate Responsibility for the British Airways Board and Senior Leadership Team. During 2012, the fuel-efficiency programme continued to make progress, with ongoing projects delivering the majority of savings. Fuel-efficiency savings measures included: • increased implementation of Auxiliary Power Unit (APU) reduced usage procedures at Heathrow • increased compliance with our new standards for carriage of potable water • flight crew using iPads to improve the fuel ordering process • removing paper-based crew reference documents from aircraft. The above projects also improved our ability to manage customer service onboard aircraft, and reduced maintenance and engineering costs. 20% reduction in ground energy consumption • providing energy awareness training • increasing electricity and gas sub-metering to identify waste • investing in energy-efficient equipment. In April 2012, we were pleased to announce we had surpassed our target, saving 90,000 tonnes of CO2 over the past 5 years. Importantly, we achieved this energy saving without any negative impact on our customer experience. We are currently working to align our long-term energy reduction strategy with our strong business growth forecast. To maintain our energy saving momentum, we have set ourselves an interim target of a 5 percent reduction in energy use for 2013 against our new 2012 baseline. We will announce our long-term energy targets and strategy later in 2013 on the One Destination website : www.onedestination.co.uk. We design and implement energy-efficiency initiatives as part of our extensive refit and refurbishment programme across our property portfolio. Our inhouse energy analyst scrutinises all projects and works with designers to ensure energy-efficiency has been fully considered and integrated wherever possible. For example, during the building of an extension in our cargo operation at Heathrow, we chose a more efficient heating control system – saving over 30 tonnes of CO2 a year. Sustained reduction in our energy consumption across our buildings demonstrates the success of this collaborative approach. 3: ENVIRONMENTAL SUSTAINABILITY 31 We are also taking advantage of opportunities in major refurbishment and relocation works to improve our energy consumption. In 2012 we began the transfer of our flight simulators and flight training facilities to our main engineering base at Heathrow, which we predict will achieve a 25 percent reduction in energy use by upgrading to more efficient cooling, lighting, and control systems. We aim to take advantage of future projects in a similar way, as part of our strategy for property development. To achieve this we made one of our main datacentres a ‘dark site’ by relocating our colleagues to more energy-efficient buildings. We also switch off computer room air-conditioning units overnight and have moved equipment from our least energy-efficient datacentre to a better location. We work in partnership with Heathrow Airport Ltd (HAL) to minimise the energy footprint in our terminal buildings, sharing energy metering data to identify inefficiencies and quickly find possible solutions. We are also collaborating with HAL in testing voltage controls across Heathrow, with a view to reducing electricity use for all the airport’s occupants. Further reductions in power consumption have been possible thanks to ‘server virtualisation’, an approach that significantly reduces the number of physical devices in the datacentre, yet increases its overall computing capacity. Also, introducing a software power management utility has reduced datacentre servers’ power consumption by 40 percent. In 2012 we put our electricity supply contract for Heathrow out to tender, and we continue to be 100 percent powered by green energy. We do not think it is sustainable in the longer term to rely solely on power generated off site, so to limit our reliance on the National Grid we are assessing onsite renewable energy technology suitable for an airport. Given the rate at which renewable energy technology is advancing, our near term goal is to generate at least 5 percent of our airport energy needs through onsite renewables - primarily from solar energy produced by photovoltaic panels. Consumption of electricity at UK datacentres expressed in CO2 Tonnes Green IT Our Green IT programme started in 2007, and aims to ensure we use and dispose of computers, servers and associated subsystems efficiently, with little or no impact on the environment. During 2012 we improved efficiency and reduced our CO2 emissions at our two Heathrow datacentres. This has achieved a net reduction of 1.25 million kWh. This, along with introducing more energy-efficient servers, has helped reduce our IT carbon footprint by 759 tonnes of CO2. We have also installed low-voltage LED lighting at both buildings and optimised the flow of cold air to improve cooling efficiency and reduce power consumption. 11,400 11,276 11,200 10,975 11,000 10,800 10,600 10,298 10,400 10,200 10,000 9,800 2010 2011 2012 Next Steps • Investigate ‘evaporative cooling’, which would allow us to switch off all computer room air-conditioning in datacentres for 95 per cent of the year • Review the use of low-voltage server components to reduce energy use • Work on projects to reduce power consumption, such as ‘server virtualisation’ • Donate up to 7,000 desktops and laptops to Computer Aid International between 2013 and 2014, which will become available as we complete our Windows 7 Desktop Refresh programme 32 British Airways Corporate Responsibility Report 2012 Year 3: ENVIRONMENTAL SUSTAINABILITY 3.4.5 Forest footprint Deforestation is responsible for around a sixth of global carbon emissions – more than the entire transport sector, and second only to the oil and gas industry. British Airways recognises the significant impact deforestation has on the environment, and its relevance to climate change. Reducing deforestation is widely regarded as one of the fastest and most costeffective ways to reduce global carbon emissions. To play our part, we are focusing on our forest footprint – the amount of deforestation we caused directly or indirectly through our business operations – and identifying ways we can help reduce the effects of deforestation wherever possible. The Carbon Disclosure Project (CDP) Forests Program – previously known as the Forest Footprint Disclosure Project – helps us understand and address our exposure to deforestation risks through using timber products, palm oil, soy, cattle products and biofuels. Since 2009, British Airways has remained the sector leader in this area. Disclosure to CDP’s Forests Program also allows us to review our internal risk management. Given the growing concern around security of supply for commodities over the next 20 to 30 years, the disclosure process gives British Airways and others space to work with suppliers and customers to identify potential problems, and to help to improve resilience throughout supply chains. In 2012, for the third year running, British Airways achieved Sector Leader in the Travel and Leisure category of the CDP Forests Program. In 2012 our forest footprint was estimated at a minimum of 160 acres, compared to 127 acres in 2011. This increase can be attributed to improvements in data collection and analysis. The programme focuses on qualitative as well as quantitative measures, such as how a company assesses its deforestation risk. So we are now working with our suppliers to further refine data collection, setting quantifiable targets for buying ‘forest-safe’ certified products, and including a wider range of suppliers in our deforestation risk assessments. In 2012 our Forest Footprint was estimated to be Next Steps • Expand our forest footprint assessments to key suppliers outside the UK • Improve our assessment and understanding of supply chain impacts on deforestation risk 3.4.6 Customer engagement on climate change - One Destination Carbon Fund At the end of 2011 British Airways replaced its carbon offsetting scheme. This was in response to feedback from customers keen to support projects in the UK as well as overseas as part of efforts to reduce carbon emissions. To achieve this we created the One Destination Carbon Fund. Customers can donate to the fund when they book flights, or at any time online at www.ba.com. Our charity partner Pure (the Clean Planet Trust registered Charity No. 1112249) invests money from the fund into a range of projects, such as installing solar hot water in community sports centres, smallscale wind turbines for schools, or energy-efficiency measures in community buildings. British Airways manages all of the One Destination Carbon Fund through Pure, who invested in lowcarbon community sports projects to support our sponsorship of the 2012 Olympic and Paralympic Games. The Fund uses the UK Carbon Reduction Framework, managed by the Buildings Research Establishment, to ensure the projects are technically sound, and can achieve carbon savings and other associated benefits. Although the projects achieve carbon reductions, they are not carbon offsets and will not achieve carbon neutrality – but they do contribute to tackling climate change. Pure has also joined forces with Big Society Capital – a UK government-backed initiative to help social enterprise investments – to issue low-interest loans to the projects. Loan repayments are then recycled to fund further projects. 160 Acres 3: ENVIRONMENTAL SUSTAINABILITY 33 Boeing 787 is 20% more fuel-efficient Osprey Leisure Centre This small community leisure centre is an important resource for the Portland community in Dorset, and was set up when the former Naval sports centre was facing closure. It is now run as a charity, and a notfor-profit organisation, and has done a lot of work to improve energy efficiency and refurbish the centre. The Carbon Fund helped with the installation of 10kW of solar panels to provide renewable electricity. The expanded facility now provides swimming for 10 local schools and three special schools, with over 100,000 visits per year, up 15,000 on the previous year. Osprey Leisure Centre has also taken on five new staff. Fenham Swimming Pool Fenham Swimming Project opened in 1938, and has since given swimming lessons to generations of local people in the west end of Newcastle. When the pool was threatened with closure in 2003, the local community set up the pool as a charity and it has continued to provide a valuable service to the community. Today the pool has 76,000 visitors and works with eight local schools and ‘Swim NE’ to provide award-winning swimming programmes. The project also works with young people and the elderly on a range of other community-based training initiatives. The One Destination Carbon Fund and the local wards around Fenham combined forces to install solar thermal energy in the centre, which provides heat for the pool. This not only reduces carbon emissions but also means the pool is able to reduce the need for gas heating. The flat plate solar thermal equipment that was installed totals 78 square metres, and is predicted to deliver almost 30,000kwh of solar heat energy equivalent to 60 percent of the energy required to heat the pool. 3.5 FLEET AGE AND RENEWAL As of December 31st 2012, our fleet comprised 271 aircraft, compared to 245 on December 31st 2011. This increase is due mostly to the integration and inclusion of aircraft from the bmi fleet, although we have also taken delivery of one new Boeing 777 and one new Airbus A320. The average age of the fleet in December 2012 was 12.6 years. The table below shows the current British Airways fleet, our expected fleet for 2015, planned deliveries and further options. British Airways aircraft fleet - current and forecast (As of 31st December 2012, and inclusive of integrated ex-bmi fleet) Aircraft 2012 2015 Total planned deliveries post 2012 Boeing 747 52 41 0 0 Boeing 767 21 13 0 0 Boeing 777 52 58 6 0 Boeing 787 0 12 24 28 Airbus A380 0 9 12 7 Airbus A318 2 2 0 0 Total long haul 127 135 42 35 Airbus A320 family 110 119 10 31 Other 34 19 0 15 Total short haul 144 138 10 46 Total fleet 271 273 52 81 34 British Airways Corporate Responsibility Report 2012 Further options 3: ENVIRONMENTAL SUSTAINABILITY The first of our new Airbus A380 and Boeing 787 aircraft are due during 2013, and will offer substantial improvements in terms of environmental benefits and quality of experience for our customers. Although the overall size of our fleet will not change significantly between now and 2015, by this time many of our older and less efficient aircraft will have been taken out of service and replaced by the next generation of aircraft. Environmental performance, including noise and emissions, were key considerations in choosing Airbus A380 and Boeing 787 aircraft, as they are cleaner, quieter and more efficient than the aircraft they replace. Adding them to our fleet will contribute significantly towards our targets on noise, air quality and carbon efficiency. The Boeing 787 is 20 percent more fuel-efficient than the Boeing 767 it is replacing. The Airbus A380 is 16 percent more fuel-efficient than the Boeing 747 it is replacing. 3.6 NOISE We are working to minimise the impact of noise on communities near the airports we serve, whether at our main operating base or overseas. We achieve this through a combination of measures including the introduction of quieter aircraft to the fleet and using industry recognised best practice operational techniques to minimise noise where possible. Last year we reported that, due to unforeseen delays in the delivery of our new Boeing 787s and Airbus A380 aircraft, we would not achieve our target of a 15 per cent reduction in our average noise per flight by 2015. Based on our current fleet renewal plan, we now expect to meet this target in approximately 2018. We continue to identify and introduce ways we can reduce noise from our existing fleet. For example, we use Continuous Descent Approaches (CDAs), and in 2011 we introduced new procedures on our Airbus and Boeing 737 fleets that mean we can safely lower landing gear later on the approach, reducing noise. In 2012 we continued to investigate the use of slightly steeper approaches to landing as another way to reduce noise. Initial simulator trials have shown that a descent angle of 3.2 degrees (versus the standard 3.0 degrees) can be used consistently on our routes, and offers up to 1 dBA SEL* benefit underneath the approach path. There are, however, significant regulatory, infrastructure and operational issues to resolve before we can introduce a 3.2-degree approach angle. In 2012 we coordinated industry efforts to develop and launch the UK Ground Operations and Departures Code Of Practice. This offers four key techniques for reducing noise and emissions from aircraft operations, which are now being introduced around the industry. Comparison of A380 and 747-400 noise footprints At the same time, we have been part of a collaborative effort between BAA Heathrow, NATS and British Airways, and the Heathrow Association for the Control of Aircraft Noise (HACAN) to identify areas of concern to the local community and find innovative ways to address them. The first phase of trials began in November 2012, focusing on flights arriving in the early morning. We are also investigating other collaborative projects while we wait for community and operational feedback. Heathrow Airport monitors the noise aircraft make on each departure closely, and fines us for each flight that exceeds the permitted noise level. In 2012, 33 of our departing flights – 0.03 percent of our annual flights – exceeded permitted levels, compared to 29 flights in the previous year. We investigate each incident to identify any trends or causes we can address. In 2012, 95.92 percent of our daytime flights and 97.16 percent of our nighttime flights used the CDA procedure, compared with the airport averages of 85.55 percent and 94.94 percent respectively. We support UK airports, government and local communities introducing Noise Action Plans (NAPs) developed in accordance with the EU Noise Directive. *SEL: The Sound Exposure Level generated by a single aircraft at the measurement point, measured in dBA. This noise metric accounts for the duration of the sound as well as its intensity. 3: ENVIRONMENTAL SUSTAINABILITY 35 3.7 AIR QUALITY We take every opportunity to mitigate our impact on the local environment and improve our environmental performance. We use procedures that minimise emissions, including taxiing in and out using fewer than all engines, and use less than full thrust on take-off to reduce unnecessary emission of NOx wherever possible. We are also working to better understand how our operations affect local air quality, and supporting two academic research projects on this matter. UK Ground Operations and Departures Code Of Practice. We are sharing what we’ve learned from this initiative with our overseas operations, which each face slightly different challenges. Throughout 2012 we have worked to reduce the running time of aircraft Auxiliary Power Units (APUs). This is a small unit built into the rear of an aircraft that supplies electrical and pneumatic power if none is available from ground sources. In collaboration with BAA Heathrow, this initiative reduces both noise and emissions, and is part of our work to implement the This year our total NOx emissions at Heathrow have increased from 1115 tonnes to 1157 tonnes. This is due to an increase in total movements compared to 2011, but the amount of NOx produced per turnround has dropped from 10.9kg NOx in 2011 to 10.7kg NOx in 2012. We are using more aircraft in our fleet that produce less emissions. We currently calculate NOx emissions for our fleet at Heathrow annually, to be representative of operational procedures. For example, our measurements reflect that we use reduced thrust take-offs where possible on departure, to reduce emissions. Total NOx emissions at Heathrow (in tonnes) and average NOx emissions per Heathrow turnround (in kgs) 2010 NOx (tonnes) 2011 2012 1015 1115 1157 11.2 10.9 10.7 NOx/turnround (kilogrammes) Next Steps • Continue to reduce our impact on noise and air quality, through fleet purchasing decisions, better operational procedures and collaboration with airports, local communities and manufacturers • Introduce the quieter Airbus A380 and Boeing 787 aircraft to the fleet • Support scientific research into aviation’s contribution to particulate matter and NOx emissions, and other effects on air quality 36 British Airways Corporate Responsibility Report 2012 • Support appropriate regulation at national, European and International level • Support efforts to improve the accuracy of modelling and forecasting for effects on noise and air quality • Contribute to anticipated UK Government consultation on the future night flights regime for Heathrow, Gatwick and Stansted airports 45% 3: ENVIRONMENTAL SUSTAINABILITY of waste recycled at our London bases 3.8 WASTE AND RECYCLING British Airways aims to minimise waste, reduce disposal to landfill, and increase reuse and recycling. Where we can’t prevent the creation of waste as part of our operations, we will manage its disposal responsibly, recovering energy and resources wherever possible. In 2012 we recycled 45 percent of our waste at our main bases of Heathrow and Gatwick. This is slightly less than in 2011, when we recycled 46 percent, due to the large amount of building refurbishment and staff relocation at Heathrow generating waste that could not cost-effectively be reused, recycled or recovered. Our target to reach 60 percent recycling by 2015 has not changed. We process our non-recyclable waste at Heathrow and Gatwick through a nearby waste-to-energy plant at Lakeside. Here the residual waste left once recyclables have been removed is fed into twin furnaces. Heat generated by incineration is used to power a steam turbine that generates electricity. After combustion, any remaining ferrous and non-ferrous metals are extracted from the inert ash, which is then used as a substitute for natural aggregate. Consequently, the volume of residue remaining for final disposal is just 5 percent of what we began with. Air Pollution Control (APC) residues, the residual ash remaining after stringent filtering and scrubbing of the flue gases, are disposed of carefully at a hazardous waste landfill. Processing waste in this way, the Lakeside energyfrom-waste plant can process up to 410,000 tonnes of residual waste each year, generating some 38 MW of electricity for distribution via the National Grid – enough to power 50,000 homes. In 2012, British Airways disposed of 1,796 tonnes of waste through the plant. The amount of landfill waste managed through our contracts at Heathrow and Gatwick airports is now just 5 percent of our total waste at these locations. We continue to work with our service partners at Heathrow and Gatwick to find better ways to dispose of residual waste that cannot be incinerated, and alternatives to landfill at our other locations wherever infrastructure or alternative techniques allow. Recycled 17.4 tonnes of rigid plastics 3.8.1 Our recycling initiatives Our UK offices are fully equipped for collecting, segregating and recycling paper, cardboard, glass, aluminium cans, plastic bottles and batteries. In our cargo areas, we collect large amounts of cardboard, polythene sheeting and wood, and our engineering facilities recycle metals, fluorescent tubes, oil, wood, plastics, tyres and textiles. In 2012, we increased the amount of rigid non-bottle plastics collected to 17.4 tonnes, compared to 6.2 tonnes in 2011. As part of a lighting replacement project in our cargo warehouse at Heathrow, we collected 60kg of polystyrene packaging. Since then, we have also collected polystyrene packaging at our engineering facilities, from replacement oxygen generators for some of our aircraft. Due to the lightweight nature of polystyrene, it has made little impact on our total recycling tonnage, but we will continue to keep this kind of waste segregated. 3.8.2 Recycling and reusing our aircraft interiors British Airways Interior Engineering (BAIE) has an ongoing cost reduction and waste minimisation scheme. Last year, on average, BAIE recycled 95 percent of its total waste, with a view to further improvement in 2013. BAIE is currently looking at new ways to manage each waste stream more efficiently, while keeping costs to a minimum. All waste is sorted and segregated at source, reducing the need for separation at the materials recovery facility. All seat foams, hard and soft plastic, cardboard and carpet are recycled. Aircraft components from across the airline go to BAIE to be assessed for potential repair or reuse. Components that can be reused are cleaned, repaired and re-certified. Items beyond repair are disassembled and recycled. 3.8.3 Onboard recycling At the beginning of 2012, we launched segregation and recycling of aluminium drinks cans on short haul outbound flights from Heathrow. These cans are stowed on the aircraft and recycled on return to Heathrow along with other materials from inbound flights. We do this using our catering supplier DHL’s facilities at the Heathrow catering unit. 3: ENVIRONMENTAL SUSTAINABILITY 37 We have recently launched drinks can recycling on our inbound long haul services at Heathrow and plan to expand drinks can recycling to both short haul and long haul services at Gatwick. It is not currently possible to recycle on outbound long haul services because of strict regulations controlling international catering waste. Our aircraft cleaning partner recycles newspapers from our inbound flights into Heathrow and Gatwick, and we expect to extend this to other locations as facilities and regulations permit. 3.8.4 Our catering partner Gate Gourmet – London Heathrow long haul operation Gate Gourmet is committed to minimising its impact on the environment and has improved its waste management throughout 2012. Applying the principles of the waste hierarchy, Gate Gourmet now diverts international catering waste from landfill to the nearby Lakeside Energy from Waste plant. Working closely with new service provider Grundon, this means around just 5 percent of the site’s total waste now goes to landfill. In 2013, Gate Gourmet will work with Grundon to further reduce this figure. As well as the significant environmental benefits of preventing waste going to landfill, this also achieves considerable carbon savings. Gate Gourmet has also increased its recycling tonnage by 7 percent in 2012, compared with 2011 levels. Materials recycled include supplier packaging, used cooking oil, glass from inbound bar carts, cardboard, plastics, paper, used menu cards and wine lists. Gate Gourmet continues to work with its suppliers to minimise packaging use and waste. Throughout 2012, Gate Gourmet has also worked closely with British Airways on the long haul onboard recycling of aluminium cans. 3.8.5 Our catering partner DHL Supply Chain – London Heathrow short haul operation In 2010 DHL Supply Chain became British Airways’ catering partner for short haul operations at Heathrow. DHL has worked with British Airways to improve all aspects of the operation, including introducing onboard recycling. The result is an impressive new recycling system that sets the industry benchmark and supports our target of zero waste to landfill. Few aviation catering companies can claim to send zero waste to landfill. 38 British Airways Corporate Responsibility Report 2012 On returning from the aircraft, food trolleys are separated into domestic/EU and non-EU routes. Non-EU waste is sent to the Energy from Waste plant, while all remaining aluminium, soft and hard plastic, and cardboard waste is bailed and recycled. Packaging is recycled, and any food waste is processed in a high capacity drier that reduces the moisture content by 70 per cent. It is then supplied to the recycling facility, where it is mixed with other waste and turned into fuel used at the Slough Heat and Power Station to power a local trading estate. In 2012 a de-juicer was introduced for the milk, fruit juice and bottled water products that come back from European flights. Rather than decanting each bottle, they are instead put into a de-juicing machine that crushes the packaging and separates the liquid. The packaging is then recycled, and the liquid used in a combined Heat and Power process to produce electricity for the National Grid. The small amount of residual ash generated by this process is also made useful – in the manufacture of bricks. In 2012 DHL’s catering facility recycled 60 tonnes of aluminium, 90 tonnes of glass, 305 tonnes of paper and 194 tonnes of plastic from British Airways operations. Next Steps • Continue to work with our suppliers and catering providers to reduce the amount of waste at source, and improve recycling – in particular by looking at the volume of packaging and order quantities • Increase onboard recycling by expanding the process to our London Gatwick operation • Produce a waste footprint that will help departments prioritise waste minimisation and increase recycling We believe clean water is a precious resource 3: ENVIRONMENTAL SUSTAINABILITY 3.9 WATER British Airways’ water consumption at Heathrow continued to fall in 2012. We have used the benchmarking process we set up in 2011 to highlight problem areas and direct our maintenance partners and facilities management teams into making repairs more efficiently. We have also installed infrared sensorequipped taps and automatic toilet flushing units that use less water, and aim to introduce these across our properties, targeting the most inefficient locations first. Water consumption at our Heathrow base We believe clean water is a precious resource, and aim to minimise our dependency and impact on local supplies and infrastructure. Over the next 12 months we will be looking at the feasibility of installing rainwater recycling into selected buildings, to complement the systems already fitted at Heathrow Terminal 5. Cubic metres 295,000 290,000 288,637 284,410 285,000 The buildings acquired through our purchase of bmi are not included in this report. 280,000 275,000 268,321 270,000 265,000 260,000 255,000 2010 2011 2012 Year * This figure only includes water consumption at our UK base, and does not include potable water uploaded to aircraft. 3: ENVIRONMENTAL SUSTAINABILITY 39 3.10 LOCAL INITIATIVES Harmondsworth Moor is a 250 acre area of parkland which surrounds the British Airways corporate headquarters at Waterside, near Heathrow. It is an urban fringe environment that provides a welcome green space close to the airport and west London communities, as it is open to the public year round. The area includes several miles of high-grade riverbanks, lakes, ponds, grassland and young woodland. In 2012, Harmondsworth Moor again maintained its Wildlife Trusts’ Biodiversity Benchmark award. We have retained this award since first being awarded it in 2007. Our commitment to the management of biodiversity in the area around our headquarters is demonstrated by its inclusion in British Airways Standing Instruction 5 (Environmental Policy). This instruction requires the company to: • Comply with all legal requirements relevant to biodiversity and the management of biodiversity. • Identify, conserve and enhance biodiversity at Harmondsworth Moor. • Work with partners to establish principles for the use and management of Harmondsworth Moor. 40British Airways Corporate Responsibility Report 2012 The biodiversity of the site is measured by assessing the environmental impacts of both management of the parkland, and use by visitors. Using several different species as biodiversity indicators, the spread and breeding of these species is evidence of the improving environment and diversity of the Moor. In particular Song Thrushes have spread widely through the parkland and have responded well to management techniques which aim to improve their preferred habitats. Grass snakes have also maintained their healthy distribution throughout the parkland. In contrast, Skylarks have continued to decline, but this is following a national trend, the reasons for which are still unclear. A new landscaped field extension to the parkland which opened to the public in 2011 continues to develop well. The extension is adjacent to the Great Barn at Harmondsworth, which is considered a remnant of heritage landscape for West Middlesex, and as of 2012, is now under the ownership of English Heritage, highlighting its importance. 4: SOCIAL RESPONSIBILITY 4: SOCIAL RESPONSIBILITY 4.1 SOCIAL CONTEXT 42 4.2 OUR SOCIAL GOALS 42 4.3 OUR SOCIAL OBJECTIVES 43 4.4 CUSTOMER EXPERIENCE 45 4.5 BRAND VALUES AND MANAGEMENT 45 4.6 EMPLOYEE RELATIONS 47 4.7 RESPONSIBLE PROCUREMENT 51 4.8 COMMUNITY INVESTMENT 52 4.9 WELLBEING 58 4.10 SAFETY 59 4.11 DIVERSITY AND INCLUSION 60 4: SOCIAL SUSTAINABILITY 41 4.1 SOCIAL CONTEXT As an airline and a global business, British Airways recognises that how it operates can affect many different people, directly and indirectly. We want to provide a safe, diverse and supportive environment for all employees, improve our relationships with our customers so we can provide a better quality of service, and find forward-thinking ways to engage with communities around the world. Ultimately, we aim to set the highest standards across all aspects of social responsibility. 4.2 Our social goals Customer Make the customer the focus of everything we do Employee Make British Airways a great place to work for all employees Community investment Make a positive and sustained impact on the communities in which we operate Wellbeing Improve the health and wellbeing of customers and colleagues Safety Continuously improve British Airways’ safety and security culture Diversity and inclusion Promote a working environment that motivates, supports and recognises the differences of all colleagues 65% customer satisfaction 42 British Airways Corporate Responsibility Report 2012 4: SOCIAL RESPONSIBILITY 4.3 Our social objectives Objective Targets Progress in 2012 Invest selectively in customerfacing products and new technologies, increasing our focus on the customer Improve the proposition for customers on our shorthaul operations Revamped shorthaul catering in October 2012 on all routes Develop brand awareness and engagement in key markets Best Short Haul Carrier Award at the 2012 Business Traveller Awards Equip cabin and flight crew with iPads to improve customer service Flights crew community were equipped with iPads, starting in summer 2012 Upgrade in-flight entertainment (IFE) systems across the fleet IFE systems were upgraded on 747, 777 and 767 aircraft throughout the year Refurbish interiors of our 767 and 777 aircraft During 2012, 13 of our 767 aircraft were successfully refurbished and reintroduced to the fleet. Cabin upgrades were also completed on seven of our 747s Introduce the Airbus A380 and Boeing 787 into the fleet Construction of our first A380 was completed, and we expect delivery, on schedule in 2013. There may be a delay to the introduction of the 787 but this will not affect our flying schedule Develop understanding of British Airways brand values so we can better position the brand The three brand values most important to our customers have been determined Focus on brand activation during the Olympic and Paralympic Games Successful “Don’t Fly” television campaign aired during the Games British Airways sponsorship highly visible at Park Live Employee relations Communicate better with our customers and improve on our 2011 customer satisfaction scores 30,000 customers surveyed each month. Average score was 65% during 2012 (an improvement of 1%) Maintain the Learning Academy as a centre of excellence for corporate training Delivered 28,427 engineering training days and 40,716 days of cabin crew behavioural learning in 2012 Improve communications with employees on key issues and increase the annual survey response rate from 44% in 2011 Speak Up! Survey achieved response rate of 58% in 2012 Maintain influx of new talent through graduate and apprenticeship schemes 266 graduate and apprentice roles filled during 2012 4: SOCIAL SUSTAINABILITY 43 £1.9 million rasied by Flying Start in 2012 Objective Targets Progress in 2012 Continue our investment in the communities we serve, and develop strong relationships with our charity partners Assess total contribution to communities and charities using the BITC model, and improve on £9.1 million in 2011 BITC-assessed total direct and in-kind donations totalled £9.8 million in 2012 Continue to build on the Flying Start partnership with Comic Relief, aiming to raise £6 million by the end of 2013 Flying Start raised £1,961,500 in 2012, taking the total to over £4.5 million since June 2010 Further develop the Community Learning Centre and provide one-day workshops for UK schools and colleges During 2012, 8,247 young learners visited the Community Learning Centre Provide support, and a safe and healthy environment for our customers when they are on board, and support employees in improving overall health Continue to support customers who require medical clearance on board our aircraft Passenger Medical Clearance Unit supported 5,102 customers with clearance to fly, and provided oxygen for 3,768 customers Help colleagues adopt healthier lifestyle choices Ongoing health and wellness programmes in conjunction with national health campaigns Maintain a top safety management system that ensures safety and security remain an important aspect of our business activities Improve British Airways employees’ occupational health and minimise safety and security issues’ impact on business activities An enhanced corporate health surveillance programme to better support employees and minimise operational risk Maintain a culture of continuous improvement across all aspects of safety and security Average lost time days (per 1,000 employees) reduced from 532 in 2011 to 517 in 2012 Promote a working environment that motivates, engages, supports and recognises the differences of all colleagues Encourage and instil positive and permanent change within the airline on issues of dignity at work Dignity Index implemented in employee survey, which includes 14 directoratespecific questions A positive legacy for disabled customers post-Olympic and Paralympic games Aisle wheelchairs introduced on all aircraft 44British Airways Corporate Responsibility Report 2012 Consistent delivery of wheelchairs at aircraft side 4: SOCIAL RESPONSIBILITY 4.4 CUSTOMER EXPERIENCE At British Airways, we believe in putting the customer at the heart of everything we do – it’s a core value clearly expressed in our 35-year old motto: ‘To Fly. To Serve.’ In 2011, we committed further to this customer promise by launching a £5 billion investment programme and a wide range of new initiatives to benefit the customer. These range from new aircraft, refurbished cabin interiors, upgraded lounges, and new technology designed to make life more comfortable in the air and on the ground. confident ‘brand engagement’ plan to date, with bold messages of support to our home team athletes and a light-hearted campaign encouraging the British public not to fly during the games – to ensure Team GB and Paralympic GB could make the most of their home advantage without distraction. Outside the UK, we continued to communicate our ‘To Fly. To Serve.’ ethos throughout international markets, describing in a variety of ways how we bring this to life in the customer’s experience. Building on the investments we’ve made in the onboard experience, such as catering improvements and iPads for customer service teams, our commitment to the customer continued throughout 2012 across our markets. We also continued to reinvest in our food and beverage experience, with enhancements to our short haul offerings and on our London Heathrow – New York JFK route. In addition, we have continued refreshing the experience on our current fleet, upgrading in-flight entertainment systems on our Boeing 777 fleet, refurbishing cabin environments across our 777 and 767 aircraft, and launching extended in-flight entertainment (IFE) across all long haul flights. This activity was rewarded throughout the year, as we added more accolades to the trophy cabinet. Four awards in Global Traveller’s 9th annual Reader Survey awards, including Best Business Class added to the array of industry prizes, such as Best Airline Worldwide, Best Short Haul Carrier, Best Frequent Flier Programme and Best Business Class in the Business Traveller Awards 2012. We also won three awards for our wine selections: Best International First Class Wines, Best International Business Class Red Wine and Best International First-Class Red Wine. Alongside these enhancements, as proud airline partner of the London Olympic and Paralympic Games, in 2012 British Airways began its most Looking ahead, our new aircraft will begin joining the fleet from 2013. A total of 24 Boeing 787s and 12 Airbus A380s will eventually join the fleet, and represent our investment and commitment to our customers. We will be the first airline in Europe to operate both of these next generation aircraft. 4.5 BRAND VALUES AND MANAGEMENT Our brand positioning focuses on three areas our customers tell us are our most credible, compelling and differentiating qualities: • flying know-how based on rich heritage and uncompromising standards of safety and security • thoughtful service that is both intuitive and knowledgeable Re-igniting the pride and passion of the British Airways brand is integral to our five-year business plan and long-term strategy. Every department of the organisation has a role in positioning and managing the British Airways brand. Looking ahead, new aircraft, ongoing investment in products and services, and our marketing activity will all contribute to establishing our brand position across our markets. • unique British style 4: SOCIAL SUSTAINABILITY 45 4.5.1 Measuring our success 4.5.2Communication integrity We measure brand performance regularly, relative to the competition, in a variety of ways, such as: British Airways aims to comply with all relevant laws, standards, regulations and voluntary codes in terms of advertising price and tactical offers in the United Kingdom. • brand Equity Scores (Brand Bonding and consideration) • brand perceptions • customer satisfaction and recommendation • employee pride and advocacy To do this, we conduct regular brand-tracker consumer surveys across our key cities globally, monitor satisfaction scores from customers travelling with us and conduct regular surveys with our Executive Club database. A combination of these detailed surveys and frequent qualitative work with consumers across the world gives us a rich understanding of our brand’s performance across our key markets. Our customer satisfaction survey asks around 30,000 customers every month about their experience with us. Our headline measure is customer recommendation, and our business plan target is based on the percentage of customers extremely or very likely to recommend British Airways. The recommendation score for 2012 was 65 percent (compared with 64 percent in 2011). In 2012, we explored two new initiatives to further enhance our understanding of how well we are providing a consistent, compelling customer experience. A mystery shopping analysis across 130 of our flights helped us assess objectively the experience we offer – as did a new real-time survey method using new channels of communication such as text messages and email. This new insight will help us understand more about a customer’s journey as it happens. 65% customer recommendation score in 2012 46 British Airways Corporate Responsibility Report 2012 The British Airways marketing and sponsorship teams work closely with the in-house legal team on our marketing communications, and we provide workshops and training for this. We also ensure we get the relevant approvals from bodies such as Clearcast in the UK. During 2012, four complaints against British Airways and three against Avios Group Ltd were resolved informally with the Advertising Standards Authority (ASA). ASA upheld one adjudication against British Airways Holidays Ltd. 4.5.3 Complaints The British Airways Global Customer Relations operation is located across four major sites, Newcastle, Mumbai, New York and Bremen. We also have a number of smaller sites that respond to local language complaints. Together these teams handle post travel complaints, including lost or damaged baggage claims, as well as disruption cases. Customers can contact Customer Relations by webform, email, letter or telephone. Recently we have introduced Twitter as another contact method, and cabin crew can now capture information and gather feedback onboard our aircraft using their iPads. The vast majority of customers who do complain to us rate our response as excellent. 77% 4: SOCIAL RESPONSIBILITY pride in working for BA The Global Customer Relations department works closely with every part of the business – we hold information on all types of complaint, and use this to identify recurrent themes. We meet regularly with representatives from each business area to offer feedback on these trends with a view to addressing the issues at source. Throughout 2012, this feedback process resulted in significant improvements to the quality and reliability of our Inflight Entertainment Systems (IFE), and as a result the number of complaints that reference IFE have reduced. However, we have had an increase in issues associated with flight delays and cancellations, mainly due to poor weather conditions. Our work with the Inflight Customer Experience department has helped to empower cabin crew members whilst in the air. Crew can now resolve many issues on the spot, including offering gestures where appropriate, to customers on flights with us. This has received excellent feedback, and is in the process of being rolled out across all fleets. Our goal going forward is to continue to seek opportunities to address customer issues at the point of failure, and to support our operational colleagues in doing this. As the graph below shows, complaints per thousand passengers have dropped slightly in 2012. Average number of complaints per thousand passengers Complaints per 1000 passengers 14 12.88 12 9.94 10 9.12 8 6 4 2 0 2010 2011 2012 Year * all complaints logged on date received, not on date of flight. 4.6 EMPLOYEE RELATIONS The economic downturn across the EU and global markets continues to affect the airline industry. We are adapting continuously to the new climate and improving efficiency in our organisation, as well as re-shaping parts of the business that work closely with our partner airline, Iberia. We want British Airways to be a great place to work, and to get all employees involved in making this happen. Discussions with all colleagues, and a focus on putting the customer first in all areas of the business, is helping us to achieve this, and British Airways employees who have the best customer knowledge and are equipped and empowered to do so, are the most effective in providing excellent service. 81% of employees enjoy their job 4: SOCIAL SUSTAINABILITY 47 58% Speak Up! survey response We update our employment policies regularly with input from colleagues across the business. We aim for all employment policies to meet specific criteria. These are: • legal compliance • fairness In 2012 the Academies arranged and provided 28,427 engineering training days to around 9500 students, and 40,716 days of classroom behavioural learning to around 15,000 cabin crew. At the corporate level, we delivered a total of 3,995 hours of Leadership Development training, which included Management Skillbyte training to an audience of 1,110 employees. • short and simple 4.6.2 Speak Up! survey • cost effectiveness Understanding and responding to the views and concerns of our people remains an essential component of our drive to become a high performing, customer-focused organisation. Speak Up!, our colleague opinion survey, is our primary source of information that supports this vision. • empowering for line managers We work collaboratively with all trade unions towards establishing a modern framework for employee relations, with agreements that allow the business to focus on the customer, and retain flexibility and competitiveness. All managers at British Airways have a role in creating an accepting, inclusive and high performing team environment. They receive support in turn, which helps them manage and develop employees effectively, and encourages employees to realise their full potential. We encourage conflict resolution through alternative, informal means, and our mediation process allows for private conversations without resorting to formal action. There are trained mediators across all areas of the company available for this process. 4.6.1 Training British Airways maintains internal Learning Academies in separate areas of the business. As a “learning organisation”, our teams across the Academies are working together to implement a market-leading, fully integrated, business-wide performance and talent management system. By hosting streamlined, contemporary learning content, the need for off-lining of staff and classroom based training will be minimised. This will support an increased capacity and speed for up-skilling leading to increased performance through improved customer service. 48 British Airways Corporate Responsibility Report 2012 During 2012 we re-launched Speak Up!. We designed a new survey based on over 300 British Airways colleagues’ views and opinions through focus groups, interviews and immersion sessions. The survey is now more aligned to our business objectives as well as the issues that employees want to provide feedback on. We continue to measure colleague engagement and leadership capabilities, but now also seek our colleague’s opinions on customer focus, the safety and security culture within our company and dignity within the workplace. Dignity looks at how inclusive the British Airways work environment is and the degree to which each individual feels able to fully contribute. It also links to engagement scores, which is an important measure as our engaged colleagues (73 percent) are strong advocates of British Airways as a brand, an employer and are committed to BA’s success. Pride in working for British Airways remains high at 77 percent and 84 percent of our colleagues told us that they were proud of BA’s involvement in the Olympics and Paralympics and 81 percent responded positive to the question “I enjoy my job”. We increased our response rate from 44 percent to 58 percent which is a significant improvement, especially when comparing to our earlier years of Speak Up where we only achieved a 34 percent response rate. 4: SOCIAL RESPONSIBILITY Speak Up! survey response rate 70% 58% 60% 50% 40% 43% 44% 30% 20% 10% 0% 20102011 2012 Any form of bullying and harassment is unacceptable at British Airways. In 2012, in response to continued concerted management action to tackle the issue, we achieved further reductions on previous years. There are however still pockets of the company where colleagues continue to report such problems through Speak Up! We take this very seriously and will continue to place a strong focus on these areas during 2013. Year Through 2013 we will be implementing a number of planned improvements, these will include three British Airways overall actions and a further three by each part of the business. Smaller teams also have a wealth of information that will enable them to really understand what our people are saying and deliver great benefits for everyone within British Airways and ultimately, our customers. 4.6.3Leadership development Our leadership development and talent management strategies in 2012 have been to encourage and establish the leadership qualities in our people that we need to succeed – and to identify and develop individuals with leadership potential. Our High Performance Leadership (HPL) system links business planning, objective-setting, performance assessment, talent management, reward, leadership development and career progression. Through HPL we are developing our leaders’ ‘Behaviours for Success’ - with targeted leadership development programmes for our emerging, front line and strategic leaders. Below is an overview of some of the main leadership development programmes currently available: Emerging Leaders Apprenticeship programmes Strategic Leaders Graduate programmes Outstanding leaders & frontline leadership programmes Leaders of tomorrow emerging leaders programme Compass accelerated leadership programme Horizons strategic leadership programmes 4: SOCIAL SUSTAINABILITY 49 4.6.4 Graduate and apprentice schemes 4.6.5Employee litigation Graduates with British Airways play a key role in our business success. We currently have over 100 individuals taking part in a range of development programmes, including IT, general management, finance, procurement, engineering, human resources and operational research. All programmes offer a broad range of experience across the airline, as well as in specialist functions. All the schemes aim to nurture and develop future talent. Graduates take on real roles and responsibilities from the very beginning, and we encourage them to develop new skills and abilities from their colleagues. Each scheme also includes additional development opportunities through professional qualifications, external leadership, shadowing, and opportunities to work with local communities and charities. Our apprentice programmes also play a key role in bringing new talent into the airline. We currently have over 150 individuals on apprenticeship schemes in various areas of the business around our Heathrow base, including IT, project management, engineering, IAG and IAG World Cargo. On all schemes, apprentices follow a structured programme, designed with their personal development in mind, which gives them the chance to undertake relevant work and acquire nationally recognised qualifications. As with the graduate schemes, we encourage them to take part in other activities beyond their day jobs. At the end of the apprentice schemes, the aim is to ensure all our apprentices have the skills and experience necessary for permanent roles within British Airways. Graduate and apprentice intake 300 266 Graduates 250 Apprentices 209 Total 200 150 102 50 68 57 44 30 14 0 2010 2011 2012 50 British Airways Corporate Responsibility Report 2012 Of the remaining 67 claims, there were 44 of unfair dismissal and 36 of discrimination – many of which overlap. Of the 67 claims, 33 are ongoing, 21 were withdrawn by the claimant and eight were won by British Airways or struck out by the Tribunal. Six claims were settled and two were lost. The company also received one appeal against a previous decision to strike out a claim. The appeal has since been dismissed by the Employment Appeal Tribunal. Employment Tribunals 2010 Employment tribunal claims (per annum) 230 2011 116 2012 77 The higher number of cases in 2010 and 2011 can be mainly explained as a spike in litigation resulting from the cabin crew industrial dispute of 2010. In total, the airline was a party in 30 Employment Tribunal hearings held in 2012. British Airways won 18 of these cases and was awarded costs in two of them. Seven were withdrawn or struck out in whole or in part at hearing, two were settled at the hearing, one was settled before the remedy hearing (following a finding of unfair dismissal), and two were lost. The two claims lost were disability discrimination claims. In one, the Tribunal held that British Airways’ delay in making adjustments to an employee’s working pattern was, in the circumstances of the case, a failure to make reasonable adjustments. In the other case, British Airways successfully defended the employee’s claims of direct and indirect discrimination but lost the employee’s claims for discrimination arising from disability and unfair dismissal because the Tribunal determined, on the specific facts of the case, that the 170 100 Between 1 January 2012 and 31 December 2012, British Airways was served with 77 Employment Tribunal claims. Of these, eight were related to pilot holiday pay claims, and included claims repeated from previous years. Two of the other claims were multiparty claims, which are ongoing. One is a claim alleging trade union detriment and the other is a claim that the company breached the prohibition on offering staff an inducement to leave a collective bargaining unit. Year 4: SOCIAL RESPONSIBILITY company had not quite gone far enough in considering alternative duties before dismissing the employee on the grounds of incapability through ill-health. British Airways has appealed this decision, and the appeal is ongoing. Finally, the Supreme Court gave its decision in respect of the Williams & Others litigation relating to pilot holiday pay claims and followed the recommendation of the European Court of Justice in determining that pay during periods of holiday should include allowances paid during working time. Additionally during 2012, British Airways received 21 Employment Tribunal claims in relation to or connected with the airline’s acquisition and integration of bmi, or its decision to close the bmi regional subsidiary airline. Of these claims, 15 are multi-party claims, mostly for unfair dismissal, discrimination, or relate to redundancy payments or collective consultation claims. Of these 21 claims, 19 are ongoing and the other two have been withdrawn. 4.7 RESPONSIBLE PROCUREMENT British Airways is committed to encouraging our suppliers to achieve the highest standards in responsible procurement, and in 2012, we continued to work with an identified group of suppliers to drive the highest standards of ethical behaviour. We require that any new potential suppliers complete a comprehensive Corporate Responsibility questionnaire as part of our tender process. At a strategic level, we continued to focus on each of the three themes of our Responsible Procurement strategy: • reduce supplier emissions. • source ethical suppliers. • behave responsibly towards our suppliers. In 2011 our Procurement team adopted a risk based approach to identify where potential Corporate Responsibility risks lie in our global supplier base. During 2012, their review has allowed a clear understanding of where the highest risks exist when measured against three elements: • impact on our customers through products or services. • impact on the environment. • exposure to potential labour issues. As per our commitment in last years report, we undertook sample supplier audits in late 2012 based on Sedex Members Ethical Trade Audit (SMETA) Best Practice Guidance and are awaiting final results, the learning of which will be employed in our future strategy. Anti bribery and corruption British Airways remains committed to maintaining the highest standards of ethics, honesty, openness and accountability in our procurement processes. This is underpinned by our code of conduct, The Way We Work, and our Business Integrity Policy. In 2012 we introduced a facility where suppliers who have ethical concerns about how British Airways procurement conduct business can contact in confidence either the British Airways Company Secretary or Safecall, an external and independent specialist. Risk management Our supplier risk monitoring tool, developed with a third party, is now in place. We currently monitor and score 125 suppliers by assessing financial condition, share price movement and news events. Our buyers have access to the news feed tool that gives them upto-date intelligence on their suppliers. Suppliers payment system The process for payments to suppliers is well established and is managed by the Payment Services team, who are dedicated to ensuring that payments are managed effectively and that suppliers are paid to contracted terms with monthly “Supplier On-time Payment Performance” regularly exceeding 90 per cent. Substantial controls are in place to ensure that the creation of supplier accounts and subsequent payments operate within well-defined segregation of duties. The system and processes are audited annually, and in addition a third party audit company reviews payments to suppliers to keep the risk of duplicate payment to the absolute minimum. Building on this foundation, in the autumn of 2012 British Airways were invited by the UK Government to participate in the “Supply Chain Finance” initiative 4: SOCIAL SUSTAINABILITY 51 aimed at providing Working Capital related support to UK based small and medium enterprises (SMEs). We are supportive of the scheme and are currently engaging with relevant suppliers to establish whether they would wish to make use of such a facility. Supply chain labour policies British Airways is a strong advocate of responsible behaviour within its sourcing companies, who are required to aspire to British Airways’ supply chain standard policy. This provides guidance on responsibilities for labour practices and their application. Our supply chain standard policy is based on the International Labour Organisation standards and provides guidance on: • general conditions. • child labour. • equal opportunities and diversity. • freedom of association and collective bargaining. • forced labour. • wages, benefits and working hours. • harassment and bullying/dignity at work. 4.8 COMMUNITY INVESTMENT British Airways’ goal is to have a positive and sustained effect on the communities in which it operates. We will achieve this by: • investing in the communities we fly to. • developing strong community partnerships. • harnessing the enthusiasm and energy of our colleagues to make a lasting difference both in the UK and overseas. We will achieve this in a range of ways, including Flying Start – our charity partnership with Comic Relief – the British Airways Community and Conservation programme (BACC) and the Community Learning Centre, which provides airline specific activities for schools and colleges across the Heathrow community. As well as this, through our partnerships with a network 52 British Airways Corporate Responsibility Report 2012 of UK charities, we continue to support communities in the countries where we operate. In 2012 we worked with 40 community and conservation organisations, providing flight bursaries, excess baggage, merchandise, cargo space and fundraising events. We remain members of the London Benchmarking Group (LBG) and Business in the Community (BITC). LBG’s benchmarking model assesses our total contribution to the community. BITC reported that our total direct and in-kind donations for 2012 amounted to £9.8 million, £193,891 of which was direct to charitable donations. 4: SOCIAL RESPONSIBILITY 4.8.1 Flying Start Flying Start is British Airways’ global charity partnership with Comic Relief UK. The aim is to raise money for children living difficult lives across the world. All projects supported by Flying Start support children and their families and support lasting change, rather than simply providing handouts. Comic Relief is a proven expert in handling issues of poverty and deprivation around the world, while British Airways is known for its involvement in communities. In 2012, Flying Start raised £1,966,000 (compared to £1,946,596 in 2011) taking the total to over £4.5 million since the partnership began in June 2010. Over the past two years, we have focused our efforts on building an internal engagement and fundraising platform for colleagues. Colleagues from across the business have taken part in a variety of fundraising activities, from climbing Ben Nevis to rowing across the channel, as well as finding creative ways to apply the principles of our Flying Start partnership into our day-to-day business activities. Our customers have generously supported the partnership by donating their unwanted coins on board our flights, and making additional donations online at www.ba.com. One of Comic Relief’s most wide-ranging projects is the fight against preventable disease through vaccination. Almost two million children die from preventable diseases each year, and this is completely avoidable with simple vaccines. Since 1990, child mortality has reduced by 4.4 million each year, which is a 36 per cent drop over a 22-year period. Vaccination has played a key role in this success. In September 2012, we agreed with Comic Relief that we would focus on raising £500,000 to vaccinate 100,000 children and achieved this goal in January 2013. British Airways CEO Keith Williams launched the internal fundraising campaign on 26 September 2012. GAVI, the leading global immunisation body, will use Flying Start funds to help provide three vaccines to protect children against diseases and conditions that claim the most young lives each year. Comic Relief funds three specific vaccines, which are: • Pentavalent – this protects against diphtheria, tetanus, whooping cough, hepatitis B and heamophilus influenza, which can cause meningitis and pneumonia. • Rotavirus – this protects against the most deadly cause of diarrhoea. • Pneumococcal – this protects against pneumonia. As well as collections from employees and customers, there are regular events across the business that raise significant funds for the charity partnership. In 2012, these have included: Run the Runway at Gatwick In March 2012, 150 colleagues from Gatwick joined Gatwick Airport Limited to Run the Runway. The event took place at midnight with celebrities from Waterloo Road and Eastenders taking part alongside our CEO, Keith Williams. The event was a huge team effort and raised over £15,000. Gala Balls at Wentworth As part of the annual Community Investment charity fundraising programme, in April 2012, British Airways’ colleagues and its corporate partners joined celebrities for a round of golf to raise £189,000 for Flying Start at the prestigious Wentworth Golf Club in Surrey. To follow up, in November 2012 we hosted a second British Airways Gala Ball at Wentworth, raising £105,000 for Flying Start and our vaccines campaign. Attendees included airline corporate partners and a selection of prizewinning British Airways employees. Flying Start in Scotland In May 2012 our first Flying Start Ball took place in Glasgow. The evening was introduced by our CEO Keith Williams and hosted by Gabby Logan. The 300 attendees included British Airways colleagues and a number of our corporate clients. The event raised £18,569. One Direction In July 2012 we hosted flight BA1D, which invited customers to enter via text to win an exclusive lunch date in the air with boy band One Direction. The event raised over £50,000 for Flying Start. This was our first social media campaign and reached 176,407,431 people. On Twitter, #1DFlyingStart, trended on the day of the launch, and was the third most talked about topic. Colleague involvement Through our partnership with Comic Relief, over 150 colleagues visited seven UK and five overseas Comic Relief – funded projects during 2012. This gave them insights into how the money we raise is used to support vulnerable young people across the communities we fly to. The projects we visited included: D2 Youth Zone, Newcastle, UK The project trains young women and men to become peer educators so they, in turn, can teach other 4: SOCIAL SUSTAINABILITY 53 teenagers about the potential dangers of alcohol. D2 Youth Zone also gives young people the opportunity to explore new hobbies and interests to help them stay away from alcohol. Street League, London, UK With Comic Relief support, Street League runs a structured sport and education programme for 16-25 year olds across the UK not in education, employment or training (NEETS). The programme helps young people build their confidence, improve their health, extend their social networks and develop the skills they need to succeed in today’s demanding job market. By encouraging participants to work towards realistic goals, the programme also reduces their involvement in gangs, drugs and crime. The Street League programme uses football to engage young people and to teach them valuable skills, such as teamwork, discipline and endurance. Participants attend weekly football training sessions and are helped to develop their personal ambitions. They can also take part in an intensive eight-week programme that combines classroombased skills sessions with football coaching and training. Through its unique approach, Street League has already inspired many young people to change their lives for the better. In a previous Comic Relieffunded project, Street League managed to achieve an impressive 75 percent drop in youth crime among participants, helping them create a safer future for themselves and their communities. Nelson Mandela Children’s Trust, Capetown, South Africa James House provides essential support for children, providing monthly food parcels for their families and helping them access government grants. The children and their carers are encouraged to take a test, and those living with HIV get special support to help them stick to their treatment and stay healthy. To help children stay in school, they receive books, school uniforms and help with their homework. James House also runs a Life Centre, where young people take part in personal development programmes, which help them gain the confidence and skills they need to make positive changes in their lives and communities. Social media and our charity partnership Social media has become a key way for us to share the progress of our charity partnership and fundraising goals with our customers, and raise the partnership’s profile. 54 British Airways Corporate Responsibility Report 2012 In 2012, we published 24 posts about Flying Start on the official British Airways Facebook page. These posts achieved a combined reach of 4,035,393 Facebook users, and the combined number of active users was 78,473. The overall number of views of the Flying Start Facebook tab was 22,157. The number of page views on www.ba.com/flyingstart in 2012 was 4,109, of which 3,536 were unique page views . The average time spent on the page was 1 minute 25 seconds. This represents 2.27 percent of all page views on the One Destination website. In November 2012, Flying Start launched its British Airways Pinterest page. 4.8.2British Airways community and conservation programme Our 40 community and conservation partners are UK registered charities based in communities across our worldwide network. Our main focus is on education, youth development and conservation. We provide flight bursaries, excess baggage and cargo to support our partners in their work. Here are some examples of the projects we supported during 2012: The Haller Foundation, Mombasa, Kenya Based on the inspiring work of award-winning environmentalist Dr Rene Haller, a UNEP Global Laureate renowned for his restoration of cement quarries in Kenya, the Haller Foundation has developed an environmental regeneration model to bring economic security to the community in Mombasa. Haller’s unique model provides water security and helps rehabilitate land to make it suitable to grow crops. This is linked to farmer training and education about alternative energy, helping the community go from subsistence to surplus. The income this generates goes towards educational opportunities for children and adults, by hiring teachers for community schools built by the Haller Foundation. There is also investment in small businesses, such as solar kiosks where people can charge mobile phones. Haller has helped rural communities build their own schools, which are then fitted with guttering and water tanks, vegetable beds, solar lights, and a kitchen powered by biogas from refuse material from the surrounding farms. In 2012, British Airways contributed £20,000 towards the building of an ICT suite at the Nguuni Education 4: SOCIAL RESPONSIBILITY Centre, which is situated in a nature sanctuary and provides a clean, safe place for 30,000 children from the slums of Mombasa. The Nguuni Education Centre was awarded Best Community Library by the Kenyan National Library Service and the Goethe Institut in 2012, and received 2nd place in 2011. In 2013 we plan to work more closely with the Haller Foundation, looking into further opportunities to develop sustainable energy strategies, working alongside our environmental team here at British Airways. Variety, The Children’s Charity, Hanworth, UK The British Airways Community Investment team has worked with its colleagues Tony and Pat Furzer as well as Variety, The Children’s Charity, over the past two years to raise £18,000 to buy a sunshine coach for Lyndon Bennett School in Hanworth, close to Heathrow. Fundraising activities included a race night, raffles, cake sales, party night and car boot sales. Our CEO Keith Williams presented the coach to the school in December. Children at Risk in Need of Guidance (CARING), Glasgow, UK This year British Airways in Glasgow has supported a number of projects. CARING and FARE are just two of them. CARING is a small voluntary organisation based in Glasgow, providing a range of welfare services to children aged 7 to 17 – many of whom are on the ‘at risk register’. Several of the children have challenging home lives, and CARING provides for their basic needs, providing a place of safety and stability after school, at weekends and during school holidays, plus clothing and hot meals. Activities at the centre help children develop the confidence and self-esteem to build relationships, learn new skills and, critically, to stay safe. British Airways funded a residential camping week for the boys who attend the project, allowing them to learn new skills like team building and mentoring. Through various other stakeholders and local charities, British Airways managed to secure additional funding of £22,000 for CARING for 2013, from new funding partners including the Scottish TV Appeal and Cash For Kids. Family Action in Rogerfield and Easterhouse (FARE) Glasgow, UK FARE is a grassroots charity operating in Easterhouse, in Glasgow, established in 1989 by local people in response to the lack of support and opportunities in the community – especially for families and young people. It improves life in the neighbourhood by offering activities that raise aspirations, enhance people’s living standards and help tackle territorialism and related violence. FARE uses clubs, sport and art activities, family support groups, holidays and adult mentors to reach out to children, young people and adults. In 2012, British Airways Engineering in Glasgow launched a Christmas Toy Appeal, collecting hundreds of new toys for the children from FARE. In May, ten of our new Engineering apprentices volunteered their services to our local children’s hospice CHAS. The hospice offers respite care for terminally ill children, and helps their extended families take much-needed rest. The children go along for a few days or a week to have fun, rest, or just to be around people their own age. Our apprentices were on hand to do odd jobs, DIY and gardening to improve the environment for the children and their families. Gatwick Airport, London, UK In December 2012, British Airways Engineering at Gatwick hosted a special Christmas Party for the families of children at the Chestnut Tree Children’s hospice, the only children’s hospice in Sussex. The children were able to get up close and see new aircraft and meet a number of special guests, including LGW Emergency Services, Olympic eventing 2012 silver medallist Kristina Cook, children’s TV Presenters Dick and Dom, and of course, Santa and his helpers. 4.8.3Olympic and Paralympic ticket donations Over 1,200 tickets were donated to our community partners across the UK to attend the Olympic and Paralympic games. This included a once in a lifetime opportunity for 19 children from Scotland, who travelled to the Olympic Park to experience the amazing atmosphere of the games. 4: SOCIAL SUSTAINABILITY 55 Get Kids Going, a charity which gives disabled children and young people the opportunity of participating in sport, came to the Paralympics to watch a range of events. Many of the young people are now participating in these Paralympic sports as a direct result of seeing disabled athletes compete at the games. The Soldiers Charity brought injured army personnel to a range of events, including wheelchair basketball, five-a-side football and swimming. Bangdrum is a community performing arts group that runs music and dance workshops in Oldham and Manchester. The group brought a group of young people to a football match at Old Trafford during the Olympics. This was a once in a lifetime opportunity for many of these young people. 4.8.4Colleague fundraising and payroll giving In September 2012, our finance team, led by our Chief Financial Officer, Nick Swift, embarked on the ‘No fly-athon’ challenge in aid of Flying Start. Over 100 colleagues took part in running, cycling and swimming their way from London to Madrid, and raised over £35,000 for the vaccination campaign. Also in 2012, the annual British Airways Fun Run in aid of Cancer Research UK raised £24,764. The total raised since British Airways began the partnership in 1993 is now over £901,000. As many as 3,080 current and retired British Airways employees donate to charity through our payroll giving scheme, raising over £608,314 in 2012 for selected charities. The top three charities are Cancer Research UK, Sreepur Village in Bangladesh (a project for abandoned women and children who design cards and other gifts for sale in the UK), and Highflight, a charity for young people with disabilities who want to learn to fly or experience flying. Since May 2012, we have also been working with the Charities Aid Foundation (CAF) to increase the number of payroll giving donors by 10 per cent by December 2013. 8,247 attendedees at the Community Learning Centre 56 British Airways Corporate Responsibility Report 2012 4.8.5Emergency assistance British Airways regularly provides assistance to official disaster emergency appeals, wherever they occur in the world. In 2012 we donated over £35,000 of cargo capacity to charities, to support overseas relief programmes in affected communities. Many British Airways employees were directly affected by Hurricane Sandy, and the Hurricane Sandy appeal was set up to support and assist them. Colleagues across the British Airways network raised over £12,000 for the appeal, and the business also made a direct donation of £100,000 to the appeal. As well as this, 69 volunteers were deployed to the United States, as part of our REACH programme (a pool of British Airways employees trained in incident response) with further support from frontline customer service colleagues. The teams were split between JFK and Newark airports, mainly covering the work of their colleagues and freeing up time for them to deal with urgent family matters, recover property and find fuel. Many colleagues based in New York continued to report for work despite the disruption and difficulties, and worked with our volunteers, sharing knowledge and experience and helping customers. We sent clothing, blankets, jerry cans, amenity kits and other items to JFK, to meet colleagues’ immediate needs. The distribution process was set up and handled by the local team and the volunteers. 4.8.6The British Airways Community Learning Centre The British Airways Community Learning Centre, opened in 1999, shares our colleagues’ talent and expertise with students and teachers at schools and colleges around the UK. Catering for all needs and abilities, our five specialist trainers provide regular one-day workshops for schools, colleges and community groups, giving an insight into our airline and the world of work. Our core programmes include information and communication technology (ICT), customer service, languages, and global and environmental education. In 2012, 8,247 young learners and teachers benefited from education sessions at our Community Learning Centre, or in their schools. To date, the Community Learning Centre has reached 77,591 young people. 4: SOCIAL RESPONSIBILITY The British Airways corporate work experience scheme also runs from the Community Learning Centre, and has been growing steadily over the past four years. In 2012 we took on 229 young people for five-day placements, giving them insight into the world of work, and a unique opportunity to understand what goes on at one of the world’s largest airlines. Some former British Airways work experience students have been accepted on the British Airways apprenticeship programmes, and of these, several have secured temporary positions with the Heathrow Customer Service team at Terminal 5. The British Airways Language Flag Award (BALFA) We want to get more students involved in the programme. So far, 612 students have participated in placements, and we look forward to getting more departments involved in 2013. Customer service programme Global weeks Each term, the Centre offers pupils from the local community an opportunity to learn about another country. We link our ‘global weeks’ to routes we operate, promoting cultural and global awareness. They offer a balance of activities that appeal to all the senses, and include language, music, dance, art, calligraphy, and the opportunity to debate environmental and social issues that affect the communities we fly to. In 2012, we focused on China and India, and 615 children took part. Environmental education Our environmental education programmes give young people access to the natural world, offering learning experiences at Harmondsworth Moor at Heathrow. We encourage children and young people to think about human activity and how it affects our planet, and we examine what steps British Airways takes to minimize and counteract the effects flying has on our environment. We work with several external organisations, such as the Wildfowl and Wetlands Trust, whose expertise helps us add depth and richness to our environmental sessions. In 2012, 1,210 young people and visitors took part. Language programmes Our award-winning language programmes continue to thrive, with 1,230 young learners taking part in primary and secondary school language workshops at the CLC in 2012. Our presentations stress the importance of language skills in the world of work, and have proven very popular with 845 students whose schools we visited. This is a vocational speaking test aimed at boosting youngsters’ confidence using other languages. Currently, 120 schools and 273 teachers are members of this programme, which is open to any UK school. We launched a Special Edition Language Flag Award with an Olympic theme in January 2011 to celebrate the diversity of languages at the Games. Olympic badges and certificates were specially designed for successful candidates. In 2012, 2,072 students from across the UK took the test, with a 74 per cent pass rate. The customer service programme we offer at the Community Learning Centre is designed to reflect the British Airways brand and our increased focus on the customer. In 2012, 1,075 visitors studying travel and tourism, leisure and tourism, or business studies courses benefited from our expertise. One teacher, whose students participated in the programme, said, “Many of the students are now very keen and enthusiastic to complete their Travel and Tourism course and look for a job – British Airways being their number one choice”. ICT programme Information and communication technology (ICT) is key to any business, and the programmes we offer reflect this. Primary and secondary school pupils can explore the world of British Airways and gain insights into how technology plays such an integral role in what we do. Using technology, students learn more about about our website, plan journeys around the world, and explore the airline’s rich heritage. For secondary and college students, we focus on how we use social media to promote and enhance our business. In 2012, 964 young people took part in these ICT programmes. Spelthorne Junior Citizen programme Every year, the British Airways Community Learning Centre hosts the Spelthorne Junior Citizen event, open to all pupils in their last year of primary school in the borough of Spelthorne, next to Heathrow. The event runs for two weeks and involves a series of short workshops promoting personal safety. Teams from various emergency services and community organisations join British Airways colleagues for sessions on issues including knife crime, safety near water, road safety, staying safe online, how to deal with strangers, and much more. In 2012, 1,034 young people participated in the programme. 4: SOCIAL SUSTAINABILITY 57 Next Steps • Have raised £6million for Flying Start by December • Continue using Flying Start and BACC programme as a way to engage and enthuse colleagues and customers • Upgrade the Community Learning Centre, with a brand new facility for 2014 • Grow our work experience programme by getting more departments across the airline involved, and increasing the number of young people participating 4.8.7Green IT charity support In 2012, we donated 500 of our used desktops and laptops to Computer Aid International (CAI), a charity that passes computers to good causes. As well as helping others with much needed resources we can spare, this reduces our carbon footprint, and is 20 times more energy efficient than recycling. • Formalise our volunteering programme so it is an established part of our business, enhancing communication between colleagues and increasing opportunities for volunteering across our target communities • Showcase our community partners’ work and build more strategic relationships to achieve positive things in the communities we serve The beneficiaries were Emerge Poverty Free (EPF), an international development charity that works with local organisations and community groups in marginalised communities across 14 developing countries. The computers went to a vocational training centre and the Almond School in Uganda. Pupils at the Almond School will gain IT skills, and other schools in the area will be able to visit the school and use the computers for their own IT exams. This generates income for the school and improves IT literacy across the local community. 4.9 WELLBEING British Airways has continued to invest in its customers and colleagues’ health and wellbeing throughout 2012. At the start of the year, British Airways Health Services (BAHS) started a review of onboard medical support to ensure customers get the best possible care. BAHS is currently looking into replacing automated external defibrillators (AEDs) on board with more advanced equipment that’s faster and easier to use. Much lighter, the new equipment will also contribute to fuel efficiency. Medical equipment on board our aircraft already goes beyond the regulatory minimum, and we review this on a regular basis. BAHS continues looking for opportunities to improve customers’ health and wellbeing even further, and is currently part of a working group looking at how medical emergencies are managed. The group’s aim is to reduce avoidable medical diversions. Customers receive up-to-date health and wellbeing advice online and in Highlife, our in-flight magazine. 58 British Airways Corporate Responsibility Report 2012 We released a new onboard wellbeing video in May 2012, which provides more detailed information on recommended in-flight exercises. Our Passenger Medical Clearance Unit (PMCU) continues to support customers with ‘fitness to fly’ assessments and medical clearances. In 2012, we cleared 5,102 customers to fly, provided 3,768 customers with supplementary oxygen, and ensured all their health needs were met while flying with us. Over the last year, PMCU has developed new working relationships with our oneworld partners, which has helped streamline the medical clearance process for our customers. BAHS has remained focused on making it easier for colleagues to adopt healthy lifestyles. Throughout 2012, BAHS provided a health and wellbeing programme to inform and support colleagues from across the business, and raise awareness on a range of important health issues. In 2012 we provided more events outside 4: SOCIAL RESPONSIBILITY 35% reduction in Heathrow baggage team manual handling accidents normal business hours, to reach shift and permanent night workers more effectively on health and wellbeing issues. Many events were organised with charities, and we continue our work with 23 Red to promote national government campaigns. In October, BAHS supported the government Stoptober campaign, helping colleagues aiming to give up smoking. In November, BAHS supported the Movember initiative, working with the Prostate Cancer Charity to raise awareness and vital funds. Other events included travel health road shows and a ‘beating back pain’ campaign. BAHS supported the British Airways annual fun run, by taking part in the many runs on the day and by providing information on cancer awareness. Embracing technology, health-related apps and website links for iPads are useful self-help tools for colleagues interested in health and wellbeing. In 2013 we will look for more opportunities to use technology to promote health and wellbeing among colleagues. BAHS has also been protecting colleagues’ health and wellbeing when travelling. Onsite health centres at Waterside, Terminal 5 and London Gatwick offer immunisation and travel health advice. In 2012, we reviewed our malaria risk assessment, and produced updated intranet content and a new video for crew, aimed at increasing awareness of malaria and how to prevent it. BAHS supports our goal to raise £6 million by the end of 2013 for Flying Start, by asking colleagues for voluntary donations following immunisations. The Early Active Rehabilitation (EAR) scheme continues to give colleagues faster access to healthcare and help them return sooner to work after illness or injury. Over 2012, BAHS has sought improvements in this service, and the criteria for EAR have been extended to benefit more colleagues. Our employee assistance programme, Helpdirect, remains available to all colleagues all day, every day of the year. It provides free, confidential telephone advice and a website with useful information on many subjects. Since the new provider took over in 2011, feedback from colleagues who have used Helpdirect has been increasingly positive. Helpdirect’s more proactive approach, including included visiting and supporting departments undergoing restructuring, has been a big factor in the hugely positive feedback we hear about it. BAHS has also continued providing an excellent health surveillance programme, carrying out statutory and safety critical medicals to prevent work-related ill health. The health surveillance programme has a new database, which helps us monitor compliance on an individual and departmental basis. It also helps BAHS monitor data to identify trends across the business. Next Steps • BAHS will continue to look into how we can use technology to improve the health and wellbeing of customers and colleagues. In 2013, we will be looking at using iPads on our flights to help cabin staff monitor for vital signs and improve medical care for sick passengers • We will also revise the contents of onboard medical and first aid kits and introduce new AEDs on all our aircraft 4.10 SAFETY British Airways’ Safety Management System ensures safety and security remains central to its business activities. Our structured programme of departmental safety meetings ensures effective ownership and management of safety performance across our business, and continuous improvement initiatives as defined in our Safety Plan. Open reporting ensures we have a clear insight into the day-to-day issues that affect staff and customers, and helps us develop the best ways to deal with safety and security risks as and when they arise. New technology contributes significantly, for example replacing paper forms with simple iPad apps that help staff log issues while on board our aircraft. These reports are then automatically uploaded when the device is connected to the British Airways network. The corporate safety team, working with departmental representatives, has developed an enhanced health surveillance programme that ensures colleagues receive health surveillance appropriate to their roles 4: SOCIAL SUSTAINABILITY 59 - at intervals determined by our occupational health experts. This programme benefits colleagues and the business as a whole. British Airways continues to work closely with the UK Civil Aviation Authority to improve the service we offer passengers with reduced mobility. We have reviewed each element of the service, and plan a range of further improvements throughout 2013. The 2012 figures for the number of days lost due to work-related injury were similar to those of 2011, with ‘manual handling’ and ‘slips and trips’ contributing to around half of all injuries. In 2012, the average number of lost days across British Airways per 1,000 employees was 517, compared with 532 in 2011. Our manual handling training programme has helped nearly all departments achieve 10 per cent fewer incidents. Encouragingly, the Heathrow baggage team has achieved a 35 percent year-on-year reduction in the number of manual handling incidents and lost time. Safety training is an important aspect of our management system, and established safety training programmes continued throughout 2012, including the ramp ‘Airmanship’ behavioural courses and management investigation training. Updated investigation courses are planned for 2013. Recognising the benefits of a safer aviation community as a whole, we continue to influence the industry, for example concerning the risks associated with opening and closing aircraft doors without ground equipment in place. Our policy is reflected in IATA ground handling, which ensures passengers, service partners and crew are less exposed to the risk of falling from open aircraft doors. British Airways did not receive any Prohibition Notices, Improvement Notices or safety prosecutions from external regulatory authorities during 2012. 4.11 DIVERSITY AND INCLUSION British Airways promotes a working environment that motivates, engages, supports and recognises the differences of all colleagues. We also aim to meet customers’ individual needs by improving the whole British Airways experience for customers with disabilities. In 2012, we created a new inclusion and diversity strategy aligned with our Business Plan priorities. This involved consulting internally and externally with a range of interested parties to ensure the strategy adds value to the business. One of the key elements of this new plan was to establish an effective governance structure, and for the first time, three directors have accountability for strategy and for supporting the new framework. Each directorate has a sponsor to ensure we meet local priorities and support corporate priorities. The Diversity and Inclusion team is a central source of advice, guidance and support, and expert thinking. The role of the team is to shape corporate work on disability and focus on finding ways to integrate diversity and inclusion principles at an early stage in all relevant processes, such as inclusive recruitment and procurement. 60 British Airways Corporate Responsibility Report 2012 In 2012, our key areas of focus were: Dignity at work Moving to a new approach that focuses on causes, and identifies behaviours that support health and wellbeing – such as communication, respect and recognition. For the first time, each directorate will have a Dignity Index, measured by 14 questions in the annual employee Speak Up! Survey. These questions focus on feeling valued, respected and listened-to, which takes a more holistic approach towards positive and lasting changes than in previous years. Building ability This is leading corporate work to establish a revised strategy for customers with disabilities, ensuring that such work is coordinated, and informed by customer data and feedback. Cultural intelligence Applying commercial insight into new routes to ensure our frontline staff understand cultural differences and are better equipped to meet customers’ needs. 28% 4: SOCIAL RESPONSIBILITY of all senior managers are women 4.11.1 Colleagues At British Airways, we aim is to maximise all employees’ potential, and to widen the talent pool to meet future leadership needs. We recognise the skills women and men bring to a broad range of roles, and we want to provide them with the best environment to learn and progress in their careers. We are committed to gender-balanced leadership, and want to ensure we attract and retain the best people for our business. Currently, 28 per cent of all senior managers and 25 per cent of staff reporting directly to the CEO are women. We currently have two female board members, and our diversity and inclusion strategy looks to increase the number of women at board and executive level. Senior Management Gender Report 2012 Employee group Female Direct reports to CEO Male Female % Total 3 9 12 25% Band 1 53 135 188 28% Band 2 290 529 819 35% British Airways also has a programme that looks into how issues related to employee age are managed. This programme aims to: • Ensure consistency in recruitment for both external and internal applicants • Consider flexible working options before retirement • Ensure succession planning is age-neutral • Encourage age diversity in all areas by challenging assumptions and stereotypes linked to age As seen below, between 2011 and 2012 there was no significant shift in British airways’ age profile. British Airways Employee Age Profile 2012 Percentage of staff (%) 20 Accurate as of 31 December 2012 18 Accurate as of 31 December 2011 16 14 12 10 8 6 4 2 0 15-19 20-24 25-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65+ Age bands 4: SOCIAL SUSTAINABILITY 61 British Airways also supports a wide range of flexible working options, so it can meet the many requirements of different roles within the airline. These options give colleagues choices about the way that they work, as well as adding value and flexibility for the business. Contract Profile Statistics for 2011 and 2012 2011 contract profile Band 1 Band 2 All staff Part-time 11 72 10,274 Full-time 170 743 24,232 2012 contract profile Band 1 Band 2 All staff Part-time 11 74 10,908 Full-time 170 745 25,443 Note: These employee numbers do not include colleagues based outside of the UK British Airways Contract Profile 2011 British Airways Contract Profile 2012 29.8% 30.0% 70.2% 70.0% Part Time Part Time Full Time Full Time 62 British Airways Corporate Responsibility Report 2012 4: SOCIAL RESPONSIBILITY 4.11.2 Customers The Diversity and Inclusion team worked with many different parts of the business to achieve a legacy for customers with disabilities – one that will last beyond the Olympic and Paralympic Games of 2012. In addition, we: After holding focus groups and talking at length with many of our customers, we instigated and delivered some key changes, including: • Supported London Pride by giving colleagues the opportunity to march together with our partner airlines. • Aisle wheelchairs on all short haul aircraft. • Ran a conference with our legal colleagues to update our managers on recent case law, and hosted a panel session to answer practical questions about managing a diverse workforce. • Wheelchairs at aircraft side wherever infrastructure allows. • Targeted and specialised training for all our frontline colleagues. • Streamlined codes at point of booking. • Better information online at ba.com • Joined the Campaign Alliance Against Domestic Violence and held a training session for managers to raise awareness of this important issue. • Supported colleagues with our Harassment Advisors, who deal with over 80 contacts throughout the year and hold events like road shows and drop-in sessions to publicise the service. We also offered training in sign language for all customer-facing colleagues, and created a video of our customers with disabilities to help British Airways staff understand what was important to them - as part of a package of training linked to the Paralympics. Next Steps • We will focus on inclusion and further integration, moving away from specific diversity strands and concentrating on recognising our colleagues and customers’ individual needs. Unconscious Bias training will be available to all our managers. This replaces more traditional training and supports managers’ decision-making by raising awareness of bias and stereotyping • Dignity at Work will give managers valuable information about their workforce. For the first time, each directorate will have a Dignity Index, measured by 14 questions about feeling valued, respected and listened-to, which takes a more holistic approach towards positive and lasting changes • Maximising opportunities and learning from our experiences supporting the Paralympics will be a key priority. We need to ensure there is continuous improvement in how we support customers with disabilities. A new strategic group will review the key priorities, and revised data will highlight where we can improve most BA offers training in sign language Supported London Pride 4: SOCIAL SUSTAINABILITY 63 5: APPENDICES 5.1 REPORT SCOPE 65 5.2 DATA CALCULATION AND METHODOLOGY 66 5.3 DATA 67 64 British Airways Corporate Responsibility Report 2012 5: APPENDICES 5.1 REPORT SCOPE This report was compiled by the British Airways Corporate Responsibility team. For any comments or feedback, please visit www.onedestination.co.uk or email the team at one.destination@ba.com This report covers the calendar year 1st January to 31st December 2012, and unless otherwise stated, all figures, calculations and assumptions are based on this reporting period. The previous report was published in June 2012 and covered the calendar year of 2011. It is British Airways’ intention to continue producing reports on this annual cycle, however, updates on individual projects, initiatives and unforeseen events throughout the year are covered by our media partners, our main corporate website ba.com and our CR microsite www.onedestination.co.uk. As covered in the Stakeholder Engagement section in section 1.7, this report is intended for a diverse range of individuals with a stake or interest in British Airways’ CR activities. These include customers, shareholders, potential investors, employees, students, academic professionals, suppliers, regulators, governmental representatives, industry trade groups and associations, representatives of other airlines (including our partners and competitors), NGOs, the travel and tourism market, community groups and the media. This is balanced against the expectations of the multiple NGOs, trade partners and local community groups we communicate with, so in some areas we have reported in greater detail than specified by DJSI or GRI frameworks. The topics covered in this report are also prioritised according to their importance to the British Airways business plan, as well as IAG’s strategic goals. As covered in the report, the purchase of bmi from Lufthansa (and the subsequent integration of the airline into the British Airways mainline UK operation) was an ongoing process in 2012, starting in April and ending in December. This was followed by the sale of the bmi regional subsidiary to Sector Aviation Holdings in May 2012, and the closure of the Bmibaby subsidiary in September 2012. For these reasons, as well as the desire to present year-on-year changes accurately, data for the bmi operation is not included in some reporting areas, such as ground energy usage and water consumption – and where this is the case, we have made it clear in the main body of the report. The content of this report was defined through multiple means, including: • materiality surveys and discussion with stakeholders • feedback on previous reports • moving towards a format more in line with the Dow Jones Sustainability Index (DJSI) and Global Reporting Initiative (GRI). 5: APPENDICES 65 5.2 DATA CALCULATION AND METHODOLOGY All economic, environmental, and social indicators and commentary covered in this report were reviewed during 2012, by drawing on our experience with the Dow Jones Sustainability Index, the FTSE4Good index, the Global Reporting Initiative framework, and our own previous experience of reporting on CR issues and activities. We do not believe any of the current indices or frameworks offer a ‘one stop shop’ for comprehensive and transparent CR reporting by airlines. For this reason, we have chosen to report against a range of indices and qualitative areas, taking into account industry standards, investment indices, the GRI framework, and our discussions with key stakeholders. British Airways has a long history of reporting on CR issues (our first environmental report was published in 1992), and these annual reports have evolved to meet stakeholders’ needs (see section 1.7). There are some restrictions on the scope of the report, and these are due to the following limitations: • Climate Change Reporting Framework (CDSB) published by the Carbon Disclosure Standards Board, (www.cdsb.net/climate-changereporting-framework) Operational boundary • Scope 1 – Fuel burned directly by British Airways operations. Our definition includes all aircraft flying on a flightplan filed for British Airways, BA Citiflyer or Openskies. In addition we include British Airways ground vehicles. Actual fuel burn data is used for these calculations. • Scope 2 – Electricity use by the global British Airways property portfolio (including leased space within airports). This was primarily calculated from actual metered energy use. • Scope 3 – Emissions of our suppliers occurring upstream and emissions occurring downstream of our operations. This was calculated using a combination of actual fuel burn data and estimates. • Waste & recycling – data refers solely to our main bases of London Heathrow and Gatwick. Greenhouse gas emissions factors Over 99 per cent of the carbon footprint was calculated using greenhouse gas emissions factors as defined by the UK government in ‘2012 Guidelines to Defra/DECC’s GHG Conversion Factors for Company Reporting’ (www.gov.uk/government/ publications/2012-greenhouse-gas-conversionfactors-for-company-reporting). To estimate emissions from overseas properties without metered energy data, we create annual, British Airways-specific emissions factors (kWh per m2 occupied) based on our UK energy consumption per property type (cargo, engineering, or passenger-related). • Employee age – All statistics related to average age of employees refer only to UK-based colleagues. Carbon Efficiency • Ground energy target – Our ground energy target only includes properties within the UK, excluding those acquired through the purchase of bmi. • Water – Data for the consumption of water refers solely to our London Heathrow hub, including our offices in and around Heathrow. However, this does not include potable water which is uploaded to our aircraft. Carbon footprint This section of the report was primarily prepared using the methodology outlined in: • The Greenhouse Gas Protocol of the World Resources Institute and World Business Council for Sustainable Development (WRI/WBCSD), (www.ghgprotocol.org) Additionally, the following resources supported carbon reporting in this section: • Guidance on how to measure and report your greenhouse gas emissions published by the UK Department for Environment, Food and Rural Affairs (DEFRA), (www.gov.uk/measuring-and-reportingenvironmental-impacts-guidance-for-businesses) 66 British Airways Corporate Responsibility Report 2012 We calculate carbon efficiency using flight-by-flight data on greenhouse gas emissions and payload carried. We report carbon efficiency in grammes of CO2 per passenger kilometre (gCO2/pax-km). The CO2 component of the carbon efficiency calculation includes all CO2 emissions within Scope 1 and 2 operational boundaries. As with the Carbon Footprint methodology, emissions were calculated using the ‘2012 Guidelines to Defra/DECC’s GHG Conversion Factors for Company Reporting’. For the passenger kilometre component of the carbon efficiency calculation we collect all passenger and cargo payload data from flights within our Scope 1 operational boundary. The cargo data is converted into equivalent passenger-kilometres in order to capture all of the payload carried within one simple metric. 5: APPENDICES Local air quality Forest footprint Total NOx is based on evaluation of NOx emissions from aircraft departures, arrivals and ground operations at Heathrow. The arrival and departure NOx emission calculations are based on a modified ICAO Landing and Take-Off (LTO) cycle model, using appropriate adjustments for thrust settings and taxi times based on actual operational data. Ground emissions include estimations of the quantity of NOx emissions due to engine ground running and Auxiliary Power Unit (APU) use. For all calculations related to the Carbon Disclosure Project Forests Program, we have assumed that: We do not currently calculate SO2. There is no ICAO engine emission certification standard relating to SO2 and in terms of emissions from aircraft and the impact on local air quality, SO2 is of less significance than NOx. • 1 acre of deforested land is required to produce 1.44 tonnes of beef product • Forest Stewardship Council (FSC) paper is construed of 70 percent certified material. • 1 tonne of uncoated (non-recycled source) office paper is equivalent to the processing of 24 individual trees • average tree density in affected areas is 542.95 trees per acre • 1 acre of deforested land is required to produce 1.03 tonnes of soy-derived product • 1 acre of deforested land is required to produce 1.59 tonnes of palm oil 5.3 DATA Introduction and Economic Performance Indicators Section Indicator 2010 2011 2012 Units Note 1.1 Total passengers carried 24.0 34.0 36.7 Millions 2010 figure is for 9 months to December 2010 1.1 Total employees 39,901 39,295 41,315 2.4 Operating profit £342 m £518m £274m Pounds sterling 2010 figure is for 9 months to December 2010 2.4 IAG total revenue N/A 16.3 18.1 Billions of euros 2.4 IAG operating profit N/A €485m €23m loss Euros 2.4 Revenue passenger kilometres 106,082 117,348 126,436 Millions 2.4 Available seat kilometres 136,721 150,152 158,247 Millions 2.4 Cargo tonne kilometres 4,593 4,793 4,891 Millions 2.7 Load factor 73.5% 75.9% 79.9% Percent of total capacity utilised 2.7 Punctuality 76% 83% 79% Percent of flights departing on time Within 15 minutes of published departure time 5: APPENDICES 67 Environmental Performance Indicators Section Name 3.4.3 Our greenhouse gas emissions (Scope 1 + Scope 2) 2010 2011 2012 Units Note See section 5.2 for note on carbon calculations as per CDP requirements 15,370,282 16,626,782 17,554,312 tonnes CO2 3.4.3 Scope 1 15,255,349 16,530,255 17,452,882 tonnes CO2 3.4.3 Scope 2 114,933 96,527 101,430 tonnes CO2 3.4.3 Scope 3 516,850 496,464 4,267,936 tonnes CO2 103.3 102.1 101.9 grammes CO2 per passenger kilometre 3.4.4 Carbon efficiency 3.4.5 Forest footprint 314 127 160 Acres 3.5 Fleet age 11.4 12.3 12.6 Years 3.6 Heathrow departure noise infringements 25 29 33 Number of flights 3.6 CDA procedure achievement (Heathrow daytime) 96% 96% 96% Percent 3.6 CDA procedure achievement (Heathrow nighttime) 95% 97% 97% Percent 3.7 Total NOx emissions at Heathrow 1,015 1,115 1,157 Tonnes NOx 3.7 Average NOx emitted per turnround (Heathrow) 11.2 10.9 10.7 Kilogrammes NOx per turnround 3.8 Waste recycled at Gatwick and Heathrow 45% 46% 45% Percent 3.8 Waste send to landfill from Gatwick and Heathrow 9% 3% 5% Percent 3.9 Water consumption at Heathrow 288,637 284,410 268,321 Cubic metres 68 British Airways Corporate Responsibility Report 2012 See section 5.2 for note on forest programme calculations 5: APPENDICES Social Performance Indicators Section Name 2010 2011 2012 Units Note 65% Percent extremely or very likely to recommend British Airways Survey based on responses of approximately 30,000 passengers each calendar month This is an average based on all complaints received in the calendar year 4.5.1 Customer Recommendation Score 4.5.3 Average number of complaints 12.88 9.94 9.12 Complaints per 1000 passengers 4.6.2 Speak Up! Survey response rate 43% 44% 58% Percent of total employees who responded to survey 4.6.4 Graduate recruitment 30 68 57 Number of graduates recruited per annum 4.6.4 Apprentice recruitment 14 102 209 Number of apprentices recruited per annum 77 Number of employment tribunal claims served against British Airways 4.6.5 Employment tribunal claims 4.8 BITC assessment of total direct and in-kind donations 63% 230 £5.0m 64% 116 £9.1m £9.8m Pounds sterling Total direct and in-kind donations as reported by Business in the Community 4.8 BITC assessment of direct donations £190,000 £190,000 £193,891 Pounds sterling Direct payments to charitable institutions as reported by Business in the Community 4.8.1 Flying Start partnership cumulative total N/A £2.3m £4.5m Pounds sterling Partnership with Comic Relief UK was established in mid-2010 4.8.1 Flying Start annual total N/A £1,946,596 £1,966,000 Pounds sterling 5: APPENDICES 69 Section Name 2010 2011 2012 Units Note Funds donated by current and retired British Airways staff, through payroll system 4.8.4 Colleague payroll giving £600,000 £600,000 £608,314 Pounds sterling 4.8.6 Community Learning Centre annual attendees 8,000 7,953 8,247 Number of sudents who have attended courses at the CLC 4.9 Passengers cleared to fly by Medical Clearance Unit N/A N/A 5102 4.9 Passengers supplied with supplementary onboard oxygen N/A N/A 3768 4.10 Annual average number of lost days per 1000 employees N/A 517 532 4.11.1 Female senior managers 28% 28% 28% Percentage of entire senior management community 4.11.1 Female direct reports to CEO 25% Percentage of all direct reports to the CEO who are female In 2010, this indicator was not reported on 45-49 Mode age demographic Based on UK employees only (this indicator was not reported on in previous years) 30 .0% Percentage of employees who work on a part-time contract basis Based on UK employees only 4.11.1 Average age of employees 4.11.2 Number of part-time workers N/A N/A 28 .0% 25% N/A 29.8% 70 British Airways Corporate Responsibility Report 2012 In 2010, this indicator was not reported on onedestination.co.uk