Energy and greenhouse gas management
Increasing energy efficiency and reducing greenhouse gas emissions associated with our operations are central goals for our environmental sustainability program. Our primary sources of greenhouse gas emissions come from our offices and data centers, and we are pleased to announce that we reached our 2014 goal of reducing emissions by 10 percent by the end of calendar year 2020 in the United States.
ADP Pledge to achieve net zero greenhouse gas emissions by 2050
In 2021, we decided to make the commitment as an organization to achieve net zero greenhouse gas emissions across scopes 1, 2 and 3 by 2050. In our current fiscal year, we are developing a Paris Agreement-compliant climate transition plan that will include short, medium and long-term global goals towards this target, and we expect to set these goals against a pre-pandemic 2019 baseline. We plan to invest in renewable energy, efficient infrastructure and sustainable alternatives, among other things, to reach this goal, and look forward to providing updates as we strive towards reducing our emissions. We are excited to have a portfolio of several projects already in motion to support the goal, including the use of solar panels, replacement of legacy equipment and increased use of fuel cells at our facilities. We expect to formalize our targets in line with our operating plan and financial reporting cycle for fiscal year 2022 and stakeholders will be able to find more information at sustainability.adp.com when available.
Climate risk and opportunity management
Climate change is an increasingly urgent topic that may have significant impacts on our business, our associates and the international community. As governments and markets consider a range of options to adapt to a changing climate, the possibility of disruption grows. There are both risks and opportunities present in these shifting landscapes, and we are committed to understanding and positioning ADP and our services to mitigate potential threats and capitalize on new markets as we navigate the impacts of climate change.
Our Board is committed to sound environmental practices and our Nominating/Corporate Governance Committee of the Board of Directors has oversight of environmental sustainability, a responsibility which has been enshrined in the Committee’s charter for several years. The Committee is supported by the ESG Steering Committee on these matters and routinely updates our Board so that the Company can effectively address emission reduction matters as well as climate change mitigation and adaptation through key programs and policies, ensuring that our business operations are resilient to climate change impacts.
Energy and greenhouse gas reduction
Throughout 2020, ADP invested in energy reduction initiatives that improved efficiency, reduced energy consumption and decreased our emissions. Some examples include the upgrading of multiple data centers with lithium-ion batteries for increased operational longevity and reduced energy consumption, installing LED lighting, implementing new Building Management Systems (BMS) to increase building efficiency and a revised travel policy. In total, we reduced our 2020 electricity consumption by 65,000 MWh. ADP annually reports to the Carbon Disclosure Project (CDP) regarding its emissions-reduction initiatives. For more information on these efficiency projects and our 2020 emissions, visit CDP’s website here.
Greenhouse gas emissions
In calendar 2020, we continued to improve our greenhouse gas (GHG) inventory data collection and management processes. For example, over the past couple years, we implemented an independent, third-party verification process that began with a review and verification of our 2019 U.S. GHG emissions (our main source of emissions). We are proud to announce that we expanded this verification on a global basis for our calendar 2020 GHG emissions reported below. This also marks the 4th year we will be reporting our greenhouse gas emissions in all 3 scopes. With work-from-home arrangements still widely prevalent, our offices are not being used as much when compared to previous years, and in conjunction with our emission reduction efforts, we saw significant decrease in total emissions.