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Environmental

Highlights

30%

Increase in renewable energy consumption across the group

Completed

Project Design Document of Project Kasibulan which follows the UN REDD+ framework.

42%

Decrease in residual wastes reaching landfills

38,000

Tonnes of waste recycled

Indicators

1
GHG emissions
2
Energy resource planning
3
Physical impacts of climate change
4
Biodiversity
5
Energy management
6
Water management
7
Waste and hazardous materials management
8
Material consumption

We embed sustainability into our processes as we answer the call for comprehensive action to address the complex intergenerational and international climate change issue.

As the Philippines commits to a 75 percent below-business-as-usual emission reduction by 2030, Ayala Corporation aspires to achieve net- zero greenhouse gas emissions, and shall align its targets with global and national outlooks.

Goals

Ayala Corporation committed to net-zero greenhouse gas emissions by 2050. We concluded a climate action gap analysis towards the end of 2021, and have recently started a comprehensive greenhouse gas footprint validation and accounting exercise for our four core business units. This shall translate to better management of our emissions. We have partnered with South Pole to help us chart our climate journey.

We are closely monitoring the progress of the Taskforce on Nature-related Financial Disclosures (TNFD), the first integrated approach to integrating nature-related risk and opportunity analysis into corporate and financial decision-making.

We are reducing our resource use by adopting environment-friendly technologies, promoting the efficient use of materials, and utilizing renewable sources of energy whenever possible. We also focus on proper waste management strategies that can significantly impact our emissions and incur savings for our different businesses.

Finally, understanding the physical impacts of climate change allows us to grow a strong and climate-resilient business portfolio.

How We Manage
Our Impacts

POLICIES
Biodiversity and Management of Greenhouse Gas Emissions Policy
Biodiversity and Management of Greenhouse Gas Emissions Policy

With the diversity of our businesses and broad geographic reach of our operations, Ayala recognizes that we must always be aware of how we affect the environment. We commit to giving positive impact to biodiversity in our operations, projects, activities, or facilities. We shall continue to monitor our outputs and report them in a fair and transparent manner. We endeavor to create and implement projects that will manage our greenhouse gas emissions as we strongly support the government’s national re-greening efforts.

Energy, Water and Waste Management Policy
Energy, Water and Waste Management Policy

Ayala recognizes that natural resources are finite and that we have a responsibility towards the environment. We commit to the efficient use of energy and water in our products, services, operations, and facilities. We encourage our employees to practice conservation of energy and water in both the workplace and their respective homes, and we provide avenues for learning on how to positively contribute to the environment. We further promote for our employees to be responsible and to take part in the waste management efforts of the company. The organization will continue to monitor our environmental output, to seek effective ways to manage waste, and to promote ‘Reduce, Reuse, Recycle, and Recover’ processes in our businesses. Throughout our operations and in all our offices, we ensure that we meet environmental regulations and promote ways that go beyond compliance. Ultimately, we support the government’s national efforts on environmental efficiency policies.

RESPONSIBILITY
  • Board of Directors
  • Management Teams
  • Operational Teams of all Business Units
STAKEHOLDERS AND PARTNERSHIPS
Nature as Stakeholder
RELEVANT SDGs
Our SDG Initiatives

2021 Performance
Overview

Climate Change

5.3 M

Tonnes Co2e GHG emissions per equity share

Biodiversity

~6,500

Hectares of forests and mangrove ecosystems protected (Ayala Land, BPI, Globe, and ACEN)

Resource Efficiency

113 M

Liters of fuel consumption

2,067

GWh total electricity consumption

921.8 M

Cubic meters of water consumption

Waste Management

56,900

Tonnes non-hazardous waste generated

3,000

Tonnes of hazardous waste generated

Climate Change

Ayala recognizes the urgency of corporate climate action. Turning pledges to plans is key in upholding principles that value the environment as core to our sustained growth and contribution to building a better future for society.

As a response, we are committed to achieving net-zero greenhouse gas emissions across the company and in our various business units. With South Pole, we have undertaken a structured approach in assessing our subsidiaries, focusing on our four core business units: AAyala Land, BPI, Globe, and ACEN.

In the next 12 months, we will:

  1. Develop a detailed GHG footprint that includes all Scope 3 emissions from the value chain.
  2. Assess potential emission reduction activities and strategies to help us prioritize and budget for these interventions across our core business units.
  3. Establish interim targets aligned with a 1.5°C pathway across the core business units.

Aligning ourselves with the global movement for climate action ensures that the Philippines’ contribution makes a greater impact globally and locally, and through corporate action, we can secure the country’s future from the threats brought about by climate change.

Performance

Energy Resource Planning

The focus on climate change is driving the transition to a low-carbon economy.

In 2021, amid the lifting of lockdown and quarantine measures, Ayala companies increased their consumption of renewable energy. While Ayala Land’s total energy consumption rose by 7 percent, renewable energy constituted 37 percent of its energy mix, as efforts to shift properties to renewable energy sources continued under its carbon neutrality program. This represents a 10-percent increase in RE consumption compared to 2020 levels.

Ayala Land’s commitment to energy efficiency is also reflected across its different projects. Its subsidiary APMC, the biggest property management company in the Philippines, applied for an ISO 50001 certification on energy management systems and received its certification on August 12, 2021. Ayala Land invested in more efficient equipment and made operational adjustments to reduce its environmental footprint and generate savings for the company and its tenants.

Globe, whose Scope 1 emissions are largely from the fuel consumption of its generator sets and vehicle fleet, deployed over 8,500 green solutions in its cell sites. These green solutions are more environmentally friendly alternatives to traditional diesel generator sets for backup power. These solutions include lithium-ion batteries, free-cooling systems, direct-current generators, and fuel cell systems that significantly reduce reliance on fossil fuels.

In 2021, Globe also shifted 13 of its high energy utilization sites to renewable energy. These include the Globe Tower and several of its corporate facilities and data centers. This shift was made possible by the Department of Energy’s Retail Competition and Open Access (RCOA) program, which allows company facilities with a monthly average peak demand of 500 KW and above to choose their energy suppliers. Furthermore, Globe increased its renewable energy purchase by 339 percent in 2021, strengthening its commitment to further reduce its carbon footprint by shifting to greener sources of energy.

As we move forward with our commitment, Ayala Land, BPI, Globe, and ACEN will develop emissions reduction targets for Scopes 1, 2, and 3. In 2022, our four core business units will undertake an emissions reduction prioritization exercise that will identify reduction opportunities in the short, medium, and long term.

ACEN’s North Luzon Renewables supplies renewable energy to customers committed to reducing their Scope 2 emissions.

Physical Impacts of Climate Change

As more attention is given to climate change and the resulting rise in global temperatures, we are beginning to understand and anticipate the frequency of more intense weather events in certain regions and locations.

At Ayala, we are cognizant of climate change and its physical impacts on our businesses and assets. The physical effects of climate change are now more evident across our different business activities–from our value proposition to our property locations, staffing, and supply chains. As such, it is important for our businesses to understand their changing risk profiles as they strive to maintain resilience in an increasingly warming planet.

Understanding the physical impacts of climate change results in the implementation of measures that increase the resiliency of our man-made and natural assets.

This 2021, we endeavored to better understand the natural hazards and climate change risks related to our various assets. To do so, we partnered with Aon Risk Consultants to identify, rate, and interpret the natural hazards and climate risks related to our assets.

Along with our business units, we intend to complete our climate-related physical risk study by the end of 2022.

Learn More

Climate Change Initiatives by our Business Units

2030 TARGET

To support anti-poverty frameworks resulting in 50 percent reduction of extreme poverty in AFI project areas

  • Reduced and neutralized Scope 1 and 2 emissions by 100 percent, enabling the company to achieve carbon neutrality status a year ahead of its goal
  • Shifted 8 buildings to renewable energy, bringing the total to 65 buildings run on renewable energy sources, which represents 85 percent of ALI’s total GLA
  • Decreased net emissions by 200,605 tCo2e
  • Planted 56,510 native trees across 31 hectares of ALI’s carbon forests, bringing the total to 160,000 native trees planted in ALI’s carbon sinks since 2018. As a result, the company’s total carbon stock reached an estimated 8,224 tCo2e in 2020.
  • Declared commitment to stop financing greenfield coal power generation, with the goal to reduce outstanding loans or exposure to coal power generation by 50 percent by 2026, and to zero by 2032
  • Expanded its Environmental Risk Assessment (ERA) to include employee residences, offices, and machines, as well as collaterals and assets of corporate, SME, and retail clients
  • Decreased net emissions by 200,605 tCo2e
  • Secured Board approval of the Environmental and Social Risk Management System (ESRMS) general policy, which created an Environmental and Social Risk Management (ESRM) Team within the Risk Management Office
  • Deployed over 8,500 green network solutions in cell sites to replace diesel generator sets as backup power
  • Shifted 13 high-energy utilization sites, such as the Globe Tower and several corporate facilities and data centers, to renewable energy

Biodiversity

Climate change concerns have dominated ESG thinking, but awareness on nature risk is fast catching on. According to the World Economic Forum, more than half or $44 trillion of global economic value generation is moderately or highly dependent on nature. Despite this, nature faces the challenges of mass extinction rates and increased pressure on land, water, oceans, climate, and biodiversity to meet the demands of a rapidly growing population. About 25% of our assessed plant and animal species are threatened by human actions, with a million species facing extinction, many within decades.

The Taskforce on Nature-related Financial Disclosures (TNFD)

Ayala Corporation is monitoring the development of the first nature-related risk- management and disclosure framework from the Taskforce on Nature-related Financial Disclosures (TNFD). The TNFD framework signals an important step by the market to tackle the risk of nature-loss to the global economy through incorporating nature- related risk and opportunity analysis into corporate and financial decision-making.

We continue to study the progress of the TNFD framework and look forward to adapting the framework for managing nature risks within the Ayala Group upon the release of its final recommendations in late 2023.

The Rofous Paradise-Flycatcher (Terpsiphone cinnamomea) is among the bird species to be protected by Project Kasibulan in Oriental Mindoro.

Ayala Corporation’s Project Kasibulan: The Mindoro Forest and Biodiversity Conservation Program

Our country has approximately 7.2 million hectares of natural forest remaining, which are home to more than 50,000 species of plants and animals, half of which cannot be found anywhere else in the world. Protecting and restoring these forests can deliver up to 30 percent of the global climate solution by 2030, and curb growing biodiversity and nature loss in the Philippines. To help curb growing biodiversity and nature loss, Ayala embarked on Project Kasibulan, a group-wide forest and biodiversity conservation program aimed at preserving and enhancing the remaining high conservation value forests in Oriental Mindoro.

Estimated to cover over 32,000 hectares and with a project lifetime of 30 years, Project Kasibulan is slated to be the first project of its scale and impact in the Philippines.

In 2021, the project was able to meet several milestones, first of which was the completion of the carbon stock assessment of its project accounting area. This resulted in the substantial completion of the Project Design Document following stringent the Verified Carbon Standard requirements of VERRA.

Project Kasibulan works with local stakeholders to ensure the long-term protection and survival of the forests of Puerto Galera and San Teodoro, Oriental Mindoro.

Additionally, Climate, Community & Biodiversity (CCB) Standards will be applied to Project Kasibulan. The CCB Standards promote excellence and innovation from the earliest stages of project design and development through implementation, ensuring the full participation of stakeholders, respect of customary and statutory rights including free, prior, and informed consent and demonstrate net positive climate, community, and biodiversity benefits.

Project Kasibulan continues to engage local governments, communities, and the indigenous people of Oriental Mindoro to ensure the long-term protection and survival of its forests and their biodiversity. The program considers the economic needs of the communities that depend on the forest for resources and livelihood and shall implement a payment for ecosystem services (PES) arrangement to decrease the unsustainable use of natural resources in Oriental Mindoro. PES will be adopted as one of the long-term sustainable interventions in the area following the UNFCCC’s framework for Reducing Emissions from Deforestation and Degradation (REDD+).

In doing all of these, Project Kasibulan fosters both climate mitigation and adaptation, biodiversity conservation, and sustainable development in Oriental Mindoro.

Biodiversity Initiatives by our Business Units

  • Devoted 880 hectares to green spaces in 22 urban estates, including 46 parks in established estates and 16 parks in emerging estates
  • Planted an additional 1,349 native trees in its developments, bringing the total number of native trees recorded in its estates and residential projects to 105,291
  • Protects 66 IUCN red-list species in El Nido and Anvaya
  • Reforested 159 hectares of land through GForest and its partners. GForest now has over 8 million users and has contributed to the conservation of forests in the Ipo watershed and the highlands of Zambales, among other areas nationwide.
Biodiversity Conservation
  • Protects close to 800 hectares of forest and shoreline in its renewable energy plants in Northern Luzon.
  • Conducts bi-annual biodiversity monitoring activities within the wind farm in Barangay Caparispisan, Pagudpud, with support from the surrounding communities
  • Monitors the distribution, density, and behavior of two conservation flagship species: the Northern Luzon Giant Cloud Rat (Phloeomys pallidus), and the Philippine Duck (Anas luzonica), in North Luzon Renewables; both species classified by the IUCN as vulnerable
  • Observed a continuous increase in nesting and hatching rates over the past year in both our Pagudpud and Bangui wind farms.
  • Initiates regular training and information campaigns with local communities and stakeholders
Social Forestry
  • Supports integrated social forestry farmers inside the North Luzon Renewables wind farm
  • Planted 12,614 seedlings of assorted fruit and forest trees within the windfarm and in partnership with local farmers

The more we discuss climate change, the clearer we see how it is intrinsically linked to biodiversity. Ayala Corporation is proactively exploring solutions that demonstrate our commitment to addressing both. This will allow us to meet our Climate Ambition and address nature and biodiversity loss through frameworks such as the Task Force on Climate-related Financial Disclosures and the Taskforce on Nature-related Financial Disclosures.

Resource Efficiency

Ayala recognizes the significant consumption of renewable and non-renewable resources involved in its many business activities, especially with the continuously growing demand for products and services. In becoming more aware of the scale of our material footprint, we are diligently tracking our materials consumption with an eye toward making it more efficient across several business units. We have adopted practices of reduction, recycling, and recovery, and have developed ongoing programs for these. We strive to become more efficient in the materials we use and to make more sustainable procurement choices as we move forward.

Performance

Resource Efficiency Initiatives by our Business Units

  • Switched 51 percent of all air conditioning units in its branches to inverter technology
  • Enrolled around 9 million BPI and BFB credit accounts to the Electronic Statement of Account (eSOA) program
  • Saved approximately 36 million sheets of paper or the equivalent of around 4,300 trees because of the eSOA program
  • Optimized water use in operations through the reuse of treated water, recovery of excess water, reuse and/or recycling water through reverse osmosis, and replacement of aging main water piping supply
  • Reuses ferrous and non-ferrous metals, electronics, scrap, solvents, and metal oxides
  • Reconfigured and consolidated two or more brands in one facility to optimize resource efficiency (e.g., the Alabang dealership with Honda, Isuzu, Kia, and Maxus showrooms, service workshops, and shared body repair facility)
  • Defined metrics to track environmental impact in order to set targets for waste reduction, water and electricity consumption, and GHG emissions
  • Adopted clean and green technologies such as the air conditioning recovery machines in the Honda and Isuzu workshops, which ensure that no hydrofluorocarbon (HFC) gases will be released into the atmosphere

Waste Management

Acknowledging our responsibility in ensuring proper waste management, we continue to monitor our consumption and waste productions while implementing strategies in different levels of our business operations to minimize our negative impacts to the environment. Moreover, we extend our reach by engaging our consumers and workforce to take part in waste management initiatives of select business units.

Ayala’s policy on waste management encourages the observation of proper protocols in the transport, treatment, storage, and disposal of hazardous waste. We promote the responsible management of waste and adopting “redesign, reduce, reuse, re-earth (compost), and recycle” processes in our businesses, wherever applicable.

Though not always understood as a frontline issue for climate change mitigation, we understand that sound waste management practices can contribute to an organization’s GHG reduction plans.

For the Ayala Group, increased awareness around waste management by our business units resulted in a 42 percent decrease in residual wastes due to the intensification of waste reduction activities and composting. This is an important development as landfills have significant environmental impacts.

Ayala Land reduces and avoids waste from reaching landfills by segregating waste at the property level and by reusing waste through recycling and reprocessing activities.

In 2021, all its Metro Manila malls set up their plastic collection booths to enable mall guests to contribute their clean and dry plastics on a regular basis. As a result, collected plastics increased by 11 tonnes or 23 percent compared with previous year.

Waste management has critical climate and greenhouse gas emission implications, making it a critical aspect of a groupwide GHG reduction strategy aligned with our Climate Ambition.

For waste utilization, Ayala Land invested in further research and development for plastics to be used in construction projects.

Ayala Land continues its efforts on composting food and landscape waste across its different properties.

We also recorded approximately 38,000 tonnes of recycled waste from across the group, comprising 66.3 percent of the total 56,900 tonnes of non-hazardous waste generated in 2021. IMI Philippines recycled 215 tonnes of plastic waste in its facilities. IMI continues the recycling, recovery, and treatment of all wastes to zero-out waste disposal to municipal landfills.

Through its Climate Ambition Project, Ayala Corporation is working towards a group-wide waste reduction program, which will be aligned with greenhouse gas emissions strategies. We are studying the reduction of waste generated in our operations as among the key pillars for managing our Scope 3 emissions.

Performance

Waste Management Initiatives by our Business Units

  • Set up collection booths in its Metro Manila malls resulting in 133 tonnes of plastic collected since 2019
  • Reprocessed 75 tonnes of plastic into construction material inputs for Ayala Land developments
  • Generated 87,000 square meters of concrete with ready-mix concrete with plastic inputs
  • Recycled 46 percent or 28 tonnes of all its generated e-waste
  • Collected 860 kilograms of recyclable waste
  • Recycled 1,400 tonnes of e-waste in partnership with over 80 corporations, organizations, LGUs, and schools
  • Established over 120 e-waste drop-off points nationwide, with free door-to-door hauling of bulky or multiple e-wastes
  • Established a community-based Treatment, Storage, and Disposal facility to help informal pickers to properly handle e-waste and protect them from environmental and health hazards

Resource efficiency and waste management are key in achieving our ambition of net-zero greenhouse gas emissions by 2050. Understanding our resource consumption and waste generation patterns will allow us to design long-term interventions that can substantially reduce our GHG emissions and optimize our material footprint.