The CEO insight: Green Air-space
Climate change is much more than a CSR issue, says Tony Tyler, Chief Executive, Cathay pacific.
Issue 40 - April 2008

At the launch of the Climate Change Business Forum in Hong Kong, Tony Tyler underscored his commitment to what he perceives to be a mission critical issue.

Tyler believes that, while climate change has not yet had a major impact on the way business is done in Hong Kong, it will soon do so. “Until recently, companies have for the most part freely emitted greenhouse gases,” he concedes. “We’re going to find that these emissions have a steep price, and they are increasingly going to be scrutinised and regulated. Carbon emission regulations will burn some companies, industries and sectors much more than others, and likewise the advantages will be distributed unevenly.”

It is clear that, in the change to a climate conscious business environment, some businesses will face serious challenges. Tyler notes that businesses must make an effort to understand the issues and adapt their business models and processes if they are to thrive in this changed environment. In Cathay’s case, climate change has been on the boardroom agenda for a number of years, and was first acknowledged as part of public reporting in a 2003 Environmental Report. Sustainability and environmental issues are now a key element in annual corporate social responsibility reporting.

Legislative drivers
Operating a business that is by definition international and subject to numerous and stringent legal requirements, it is understandable that Tyler sees legislation as a key driver of change. “The rules of the game are going to be set by regulatory policies, and companies that have carbon reduction strategies will find a competitive advantage in the new market situation.”

Finding this advantage, much like reducing greenhouse gas emissions is not easy, and every company’s approach will depend on its business and strategy. For an airline, the core operation itself is a major emitter. Improving fuel efficiency reduces both emissions and cost, so this has clearly been a fundamental part of the strategy.

Building energy use also plays important role in Cathay’s approach, and CSR reports note that management of “on-the-ground” facilities is in accordance with the international environmental management system standard ISO 14001. It is also worth noting that Cathay Pacific City, the multi-purpose space that houses the majority of Hong Kong groundbased employees and the vast majority of staff training facilities, is certified HK-BEAM platinum.

Going green
For those companies that do take climate change on board, it is important to accept this as an issue which needs to be fully embraced by the board and incorporated fully into the business strategy. Companies need to know what they are dealing with by developing robust mechanisms for identifying and tracking their environmental performance, and then develop tangible processes for managing the impacts. “We believe that openly reporting is the best way to provide stakeholder assurance,” explains Tyler.

While there is not a one-size fits all approach, “At a minimum all companies should know their carbon footprint, where their emissions are coming from and in what amount.” While this is not a simple process, and in many cases will include understanding suppliers’ carbon footprints as well as their own, Tyler believes that those companies who foresee business opportunities are paving the way to success. Correspondingly, “The companies that persist in treating climate change as simply a corporate social responsibility issue rather than a business risk and opportunity are closing their eyes to a significant shift in the market,” he says. RFP

Cathay’s environmental credits
Carbon footprint: Cathay Pacific measure and monitor their carbon footprint, both in terms of their fuel usage and operational standpoint.

Carbon offset scheme: Cathay Pacific Group launched “FLY greener” scheme in mid-December 2007 committing to offset 11,400 tonnes of CO2 emissions from Cathay Pacific / Dragonair staff business travel as from 1 January 2007 (a HK$1.3 mil commitment). A voluntary offset scheme for passengers was also launched, with Cathay Pacific matching passenger contribution for the first 3 months. Credits now go to a large high tech wind-farm near Shanghai

Clean Air: Cathay Pacific became a signatory to the Hong Kong Clean Air Charter in 2005.

Waste Management: Since March 2006, Cathay Pacific has had mechanisms in place that allow for separate storage, collection and recycling of plastic bottles and aluminum cans from inbound flights to Hong Kong.

Green Purchasing: Cathay Pacific is a founding member of The Hong Kong Green Purchasing Charter (HKGPC), an initiative of the Green Council in Hong Kong. HKGPC promotes the adoption of green purchasing practices and the production/ selection/ consumption of environmentally preferable products/ services.

Internal & external research and reporting: A cross-departmental action group has been established at Cathay Pacific to identify possible scenarios of how the business may look in an increasing carbon regulated environment. Cathy publish an annual CSR report with a substantial section on environment.

Personal profile
Tony Tyler joined Swire group in 1977 and has worked with the group in Hong Kong, Australia, the Philippines, Canada, Japan, Italy and the United Kingdom. He has been a Director of the Company since 1996 and was appointed Director Corporate Development in 1996 and Chief Operating Officer in 2005. He is also Chairman of Hong Kong Dragon Airlines Limited and a Director of John Swire & Sons (H.K.) Limited and Hong Kong Aircraft Engineering Company Limited. RFP

NOMINATE NOW

Subscribe Now

Sign Up for Ezine

Past Issues