Strategic Report Environment, Social and Governance (ESG) continued
The most significant climate-related risks to Whistl are summarised below.
Risk
Actual or potential business impact
Current and future control measures
POLICY AND LEGAL
Operational: • Loss of vehicle assets due to failure to adopt low carbon technologies, causing vehicles to be no longer roadworthy. • Increased failures in day-to-day business operations due to dependence on outdated fuels. Reputational/Market: • Negative reputation amongst peers, partners and customers as a laggard in responding to climate- related policies, potentially leading to loss of partners and customers. Financial: • Costs associated with carbon-intensive products and processes such as carbon taxes and higher operational costs. • Reduced attractiveness to potential investors and wider stakeholders if Whistl is viewed as not responding appropriately to net-zero policies. Legal compliance: • Potential litigation, fines & additional taxes should new legal/regulatory requirements on decarbonisation not be met.
• We have successfully trialled and purchased 13 electric vans (11.5% of overall fleet) for collection services and have identified routes where these will be suitable. We lease vehicles on a three-to-four- year contract; in future, we will look to lease more efficient vehicles. • We currently report our Scope 1, 2 and 3 emissions. • We have set up an ESG Steering Committee which includes a Risk Management Committee. • We have appointed external ESG and sustainability advisers to ensure awareness of horizon-scanning policy and legislative changes.
Failure to align to the UK’s commitment to net zero by 2050 – as outlined by The Climate Change Act 2008 (2050 Target Amendment) Order 2019 – as well as policies to phase out older fossil-fuel- intensive technologies and processes (e.g. carbon taxes).
MARKET
Market: • Loss of market share due to customers looking to reduce their Scope 3 emissions by choosing to contract with competitors/peers with better low carbon credentials. Financial: • Missed revenue opportunity due to failure to meet customer and/or potential investor expectations on decarbonisation.
• Our product development team has launched a set of environmental standards for our customers, and explores low carbon and green products and services (e.g. mail services offering a hybrid product, whereby customers upload in-house- created letters to an online portal for production). • We also have, within our fulfilment portfolio, The Ethical Superstore – an online retailer that focuses on environmentally-friendly products and packaging. • In the future, we will include our carrier partners in updated policy requirements on low-carbon transition credentials and work collaboratively with partners to realise a low carbon transition.
Failure to attract and retain climate-conscious customers (especially business customers who look to reduce their Scope 3 emissions) as a result of a failure to transition to or utilise low-carbon mail carrier partners and processing methods.
REPUTATION
Market: • Loss of market share due to customer preference for peers/competitors with a greater low carbon service offering. • Loss of top suppliers due to partnership with more ambitious low carbon businesses. Financial: • Missed opportunity to attract climate-conscious customers and suppliers.
• We have improved external communication of our ESG and climate-related performance and activities. • We have plans to review opportunities to submit to best-practice ESG ratings agencies for our sector.
Risk of negative public, customer and supplier perception of Whistl due to failure to respond to demand for more low carbon services.
Whistl Annual Report 2022
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