We have a long history of managing our environmental impact. It is our mission to empower our customers to accelerate the development of vehicles that are safer, more efficient, and have less impact on the environment.
Our commitment to the environment extends to ourselves, our customers and our shareholders. We are continually looking for opportunities to improve: environmental sustainability is essential.
We continue with our commitment to environmental sustainability and are actively seeking steps to reduce our environmental impact and to achieve our goals of carbon neutrality by 2030. We established the Carbon Neutral Working Group to facilitate a programme to meet this target.
The aim of the Carbon Neutral Working Group will be to oversee the programme and implementation of the activities and functions required to meet the carbon neutral goal for the Group by 2030. This will include the development of a comprehensive engagement programme and climate awareness groups throughout all our businesses. This step underlines our dedication to addressing climate change and moving towards a sustainable future.
The Carbon Neutral Working Group is comprised of representatives from all Group subsidiaries with Environmental Champions within each subsidiary to promote awareness and best practice. The Carbon Neutral Working Group will also develop and measure a
baseline of our ongoing carbon performance to enable progress to be measured and evaluated on our journey to carbon neutrality.
We have also partnered with Auditel, a leading carbon solutions company, to assist us in reducing our carbon emissions and related costs as we aim for PAS 2060 verification.
The focus of our ongoing emissions reduction efforts includes greenhouse gas emissions, energy consumption, the use of renewable energy, water resources and the reduction and management of waste. The Group’s commitment to transparency includes the regular public disclosure of our emissions.
The Carbon Neutral Working Group was established following a MSCI AA rating in 2022 for AB Dynamics and ISO 14001 certification of our Environmental Management System for
our UK and German operations.
We are focused on finding ways to reduce our impact across the whole value chain to achieve our commitment of carbon neutrality by 2030. That means minimising the impact we and our products have on the environment.
The Group recognises the importance of creating environmental awareness, protecting the environment and using natural resources efficiently by continuously reducing the environmental impacts of our operations and services. In turn, the Board and senior management are committed to continually measuring, monitoring, evaluating and improving the environmental performance of all the Group’s operations. We will continue to deploy green technology wherever possible and appropriate, and to make careful and considered decisions in all our operations to reduce our current carbon footprint. Beyond our own operations, we will also continue to assist the global automotive sector to develop new technologies and processes that will reduce CO2 emissions. Reflecting these efforts, and as part of the overall government target for the UK to be net zero by 2050, we have set ourselves the target to be carbon neutral by 2030, which will be the focus of our efforts.
Clean inputs
The Board has continued its focus on increasing the use of ‘clean inputs’: investing in renewable power at the premises owned by the Group accompanied by the use of renewal energy from renewable energy providers to meet the Group’s energy needs, to drive the agenda of sustainability across the Group.
In FY 2023, we continued to develop our approach towards reducing carbon across our operations. Some of the significant milestones include:
- successful re-certification of the ISO 14001 standard for our Environmental Management System applicable to Anthony Best Dynamics Limited, our largest subsidiary, and AB Dynamics GmbH, our German subsidiary;
- continued to expand the scope of Group-wide data collection, in particular for Scope 3 emissions;
- the formation of the Carbon Neutral Working Group that will focus on a programme towards meeting the ESG goal of becoming carbon neutral by 2030;
- increased employee uptake of the electric vehicle scheme in the UK;
- continued use of green renewable energy in the UK including the use of solar panels at two of our UK sites;
- appointment and training of Environmental Champions at our UK sites; and
- engagement of Auditel to assist us with our carbon neutral journey.
The Group has a target to achieve carbon neutrality by 2030. We have a range of initiatives underway to support this ambition such as solar panels on two sites in the UK, which generated a total of 114,933 kWh of power in FY 2023, and working with suppliers to reduce the embedded carbon across our product life cycle. ENGIE offers 100% UK generated renewable power from certified renewable sources and is fully certified as zero carbon emissions by UK Renewable Energy Guarantees of Origin (REGOs), providing complete traceability of the energy it supplies to the Group.
Responsible consumption
The Group’s activities can be summarised as largely manufacturing and assembly operations, combined with office based research, product development and other commercial functions, where we receive materials and products from suppliers, assemble them into product and dispatch to customers and some on-road vehicle testing. Therefore, the Group’s main direct impact on the environment is limited to the consumption of heating and power and fuel or electricity for customer vehicles, while providing test services and developing and testing products.
We recognise the importance of monitoring, controlling and improving our environmental performance in order to meet our medium-term target of carbon neutrality in 2030. Enhanced
monitoring of our environmental performance has resulted in an increase of annual emissions for the Group. This is most evident with our Scope 3 business travel emissions. This year we have collated more information to include all travel by air and land including the use of hire cars, train travel and hotel stays.
The Group remains committed to identifying and assessing environmental risks, such as packaging waste, arising from all operations. Waste management initiatives are encouraged and supported by the Group and materials are recycled where practicable. Local management teams are committed to good environmental management practices and are responsible for implementing the necessary initiatives to meet their local obligations. Each facility participates in recycling paper, plastic, cardboard and wood from pallets and continues to focus on reducing energy consumption through the efficient use of heating and lighting. The Group’s usage of water is minimal and predominantly relates to cleaning, bathrooms and staff refreshments.
This year the Group has built on the environmental reporting processes and procedures across its subsidiaries to provide a unified framework. The main tools used to track and monitor our environmental impact across our sites are our Environmental Management Systems. Both internal and external environmental audits have been completed at Anthony Best Dynamics Limited and AB Dynamics GmbH, resulting in a successful surveillance audit of our ISO 14001 accredited Environmental Management System. Over the next year we aim to implement this across all Group subsidiaries, standardising reporting and enabling us to set further environmental targets in FY 2024.
We have continued to build on the environmental reporting processes across all Group subsidiaries and application of the Environmental Management System where appropriate.
Our environmental reporting covers all entities over which the Group has financial control for the financial year ended 31 August 2023. Data for businesses acquired or disposed of during each reporting period is also included where available.
We are pleased with our environmental performance for the year and can confirm that we have not received nor paid any environmental fines or penalties either in the last twelve months or in the previous five years.
Reducing global greenhouse gas emissions to combat climate change is one of the biggest global challenges of our time. We aim to minimise our carbon footprint as the UK and the rest of the world transition to a low carbon economy. As the Group does not use its own logistics or freight, its primary direct energy usage and related CO2 emissions arise from its facilities and vehicles. As a business, we continue to assess our impact on the environment and try to mitigate or reduce the Group’s energy consumption wherever possible.
The Group’s emissions are broken down by Scope 1, Scope 2 and some Scope 3 emissions. For the second time in FY 2023, Scope 2 emissions associated with the Greenhouse Gas Protocol ‘market based’ method have also been calculated, in addition to ‘location based’ Scope 2 emissions.
In FY 2023, the Group’s total Scope 1, 2 and 3 emissions (market based) increased by 50% year on year on an absolute basis and 20% year on year on an intensity basis (per £m of revenue).
Our Scope 3 emissions include emissions from business travel and water supply and treatment. Compared with FY 2022, our FY 2023 Scope 3 emissions have increased significantly across the Group. The 140% increase can be attributed to a significant uplift in business travel since the relaxation of COVID-19 restrictions across the world. Our business travel data collection has also increased in scope since FY 2022 reporting, with data disclosure now including hotel stays and use of other modes of transportation, such as trains, that were not previously accounted for. In FY 2024 we will endeavour to improve the extent of our measurement of Scope 3 emissions further, in order to obtain a better understanding of our total emissions.
In FY 2023, our total energy consumption decreased by 1% year on year on an absolute basis. This was due to a decrease in mileage of vehicle testing, reported in Scope 1. There were increases in electricity usage and personal vehicles used for business purposes. In addition to the impact of the FY 2022 acquisitions, the increase in energy consumption in FY 2023 is also in part as a result of increased product manufacture and testing at our UK sites. Overall, the trend in our energy consumption data has generally followed our emissions data as our greenhouse gas emissions are mainly due to the use of energy at our sites.
AB Dynamics plc energy consumption and emissions
| Absolute emissions (including Ansible Motion) | Units | UK FY 2022 |
UK FY 2023 |
Group FY 2023 |
| Scope 1 total | tCO2e | 118 | 129 | 357 |
| Gas | tCO2e | 93 | 109 | 127 |
| Company owned vehicle use | tCO2e | 25 | 20 | 230 |
| Scope 2 (location based) | tCO2e | 142 | 184 | 555 |
| Scope 2 (market based) | tCO2e | 5 | 112 | 474 |
| Total Scope 1 and 2 (location based) | tCO2e | 260 | 313 | 912 |
| Total Scope 1 and 2 (market based) | tCO2e | 123 | 241 | 831 |
| Scope 3 total | tCO2e | 324 | 798 | 1,130 |
| Business travel | tCO2e | 323 | 797 | 1,128 |
| Water supply and treatment | tCO2e | 1 | 1 | 2 |
| Total Scope 1, 2 and 3 (location based) | tCO2e | 584 | 1,111 | 2,042 |
| Total Scope 1, 2 and 3 (market based) | tCO2e | 447 | 1,039 | 1,961 |
Notes:
Emissions for the Group are calculated using methodologies consistent with the Greenhouse Gas (GHG) Protocol: A Corporate Accounting and Reporting Standard. Source data (meter readings) has been used wherever possible; where this is not available this has been supplemented by billed data and an amount of estimated data.
For FY 2023, the UK government’s GHG Conversion Factors for Company Reporting 2023 (DEFRA factors) were used for fuels and UK electricity. Emissions factors provided by Carbon Footprint Ltd and US EPA were used for operations in other locations globally.
Scope 1 vehicle emissions include Group owned vehicles and those that are controlled by the Group for testing purposes.
The Scope 2 emissions associated with the Greenhouse Gas Protocol ‘market based’ method have been calculated again for FY 2023. In line with the Greenhouse Gas Protocol Guidance, this figure has been calculated using residual-mix emissions factors where available
(Germany and UK). In our other operating regions where residual-mix emissions factors were unavailable, country-specific emissions factors have been used instead (as per the location based method) in line with the Greenhouse Gas Protocol Guidance. Where sites consume
grid electricity backed by REGOs, this has been taken into consideration within the calculations.
FY 2023 business travel data is inclusive of private vehicles used for business purposes, train travel, air travel, car hire and hotel stays. Metering and monitoring improvements continue to be implemented to capture and improve the Company’s data stream.
Increase in 2022 figures due to inclusion of VadoTech data (previously not available for the 2022 Annual Report.
Water usage data across the Group continues to be collected this year so we are able to set a baseline and future targets to reduce water consumption can be identified and established across the business. Water is not widely used in the design, manufacturing or servicing of our products, however, we acknowledge that water is a scarce resource and careful management of water consumption is essential to minimise our impact on water availability and quality.
As part of our improved monitoring processes, FY 2023 has seen an increase in data reporting for water usage. A number of our subsidiary sites are based in shared or leased premises and water consumption is included in lease fees and water consumption data for our businesses is not available.