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Environment

• Our approach and performance
• Innovation and commitment

We have a strong record of environmental management at KPMG in the UK. Our environmental policy was implemented over 14 years ago and is supported by a developing and environmental management system. We are proud to be the first in our sector to achieve accreditation to the demanding environmental standard: ISO:14001:2004 for all our UK offices and in September 2006 we were certified for another three years.

We have a range of direct and indirect environmental impacts associated with our operations, services and supply chains. Currently our focus is on the following key issues:

• Paper Use
• Waste generation
• Climate change and implications of GHG emissions arising from energy and business travel

An integral part of managing our impacts is to understand our environmental footprint. We report our environmental information in accordance with U.K. Government Guidelines on Company Environmental Reporting for Water, Waste and Greenhouse Gas Emissions.

Responsible Consumption
In October 2004 we launched our new ‘responsible consumption’ scheme to link our entire internal environmental programme. The message behind the scheme is: reduce, reuse, recycle.

“We want to reduce consumption across a whole range of resources including energy and water, paper, stationery, mobile phones, toner cartridges and CDs. In 2007 we extended this successful scheme to provide a focus on cutting carbon through behaviour change. We aim to raise the performance of all our offices to a consistent high standard.” Mike Blake, UK Head of Infrastructure, KPMG Europe LLP and sponsor of the scheme.

The highlights of our environmental management programme, which includes Responsible Consumption, are:

Paper Use
Use of paper is one of our more visible environmental impacts.

• In 2007, we reduced the consumption of paper by a further 4 percent per person, which has contributed to our overall achievement of a 32 percent reduction over the past five years. Going forward we aim to reduce the number of sheets used per person per month further – from 929 sheets to 900 sheets.
• We successfully introduced recycled paper in February 2004 for internal printing. In 2006-07 we aimed to increase the percent of recycled paper used to 80 percent for internal, external and marketing collateral use, we actually achieved 88%.

Paper use	2006-07	2005-06	2004-05	2003-04	2002-03	2001-02
Sheets purchased	125m	125m	132m	153m	152m	171m
Percentage of recycled paper used	88%	64%	40.09%	39.84%	n/a	n/a

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Waste Generation
In the last five years we have made it a priority to reduce the amount of waste generated by each employee and direct waste away from landfill to recycling. We have in parallel developed robust management and measurement systems.

During 2007 we implemented a new confidential waste contract where all confidential waste is weighed on collection providing even greater accuracy in reporting.
We have taken time to educate our partners and employees on the ‘waste hierarchy’ with a view to avoiding waste generation as a first priority. Our target in 2006-07 was to achieve a further 5% reduction (10% in 2005-06) to 196 kgs/per person. Whilst not fully achieved across all businesses we are particularly pleased at the performance in our London offices (125kgs per person).

For more information on our waste targets for 2007-08 please e-mail us.

As part of our internal environment programme we also targeted reductions in our use of stationery; we have reduced our stationery as measured by spend per person from £119 to £100 which is an 19 percent decrease; our target this year is to maintain consumption to an average £100 per head, despite cost and staff increases.
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Energy
Our aim is to reduce energy consumption and associated CO2 emissions.

In 2006-07 total energy consumption decreased by five percent, reflecting our target to improve management practices and performance in this area. In 2006 we formed a Utilities Steering Group to examine ways to conserve energy and water in our offices, which has representation from across the firm.

For more information on our energy targets for 2007-08 please e-mail us.

Business travel
Business travel is closely linked to the level of client work we perform. We believe that the increase during the past two years is largely attributable to strong growth of the overall business.

In 2006-07 we achieved our aim of maintaining levels of road travel and have demonstrated improvements when measured against per capita. We continue to promote alternatives to travel such as audio and video conferencing particularly for internal meetings. We also offer increased mileage allowances and preferential car parking spaces to drivers who have passengers. Car sharing and use of video conference has continued improved over the past four years, saving a potential 4.8 million travel miles in 2006-07.

Business Travel	2006-07	2005-06	2004-05	2003-04	2002-03	2001-02
Road (million kilometres)	32	32	32	32	31	34
Air (million kilometres)	91	82	69	58	49	47
Total (million kilometres)	123	114	101	90	80	81

Overall CO2 Emissions
KPMG contributes to climate change through the emission of greenhouse gases from office energy consumption and business travel. Purchasing our electricity from renewable sources (energy purchased from a renewably generated source that has been certified by The Office of Gas and Electricity OFGEM) has significantly reduced our greenhouse gas emissions

In 2001 we sourced 24 percent of our electricity from renewable sources, this increased to over 95 percent in 2006-07, saving more than fifteen thousand tonnes of CO2 in the last year alone.

The increase in CO2 emission in 2006-07 can be attributed to the increase in air travel, linked to increased business activity.

One of the main environmental challenges the firm faces is how we can deliver our services and grow as a business whilst reducing our carbon footprint and other environmental impacts. In 2007 we launched our internal Carbon Forum. The aim is to provide a platform for KPMG people interested in improving the Firm’s environmental impacts to assist the business in coming up with ways in which we can approach this challenge.

*DEFRA reporting guidelines were updated in July 2005 with new conversion factors for travel, which have been applied to 2003-04 figures for comparative purposes.
** Due to changes in KPMG estate, we now do not produce CO2 emissions from oil.

Innovation and commitment:
Sustainability built in: new UK headquarters
In 2006 we announced the development of a new UK headquarters in Canary Wharf, which we are due to occupy in 2010.
We are now working towards some ambitious sustainability targets for the building, including:

• 50% CO2 cut against the 2006 Building Regulations.
• 90% of construction waste diverted away from landfill.
• 20% of materials used by value to have recycled content,
• Cycling facilities for 150-200 bikes
  

We are working with others to achieve more
It makes sense for us to work with others if we can achieve more together. For example, we wanted to reduce our environmental impact and our costs by offering employees free Oyster Cards for use on public transport in London . A multi-disciplinary KPMG team devised a scheme and then consulted with HM Revenue & Customs and Transport for London to calculate the accounting, business and technical implications. Launched in January 2007, the scheme is the first of its kind.

We are helping hospices reduce waste and save money
Our current staff charity is Help the Hospices, a national organisation that supports hospices to provide the best possible care to people with terminal illnesses. We wanted to do more than just raise money. So working with The Carbon Trust, we designed an energy audit tool than will help more than 200 hospices calculate their carbon footprint, improve efficiency and cut costs.

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