We seek to minimise our impact on the environment and to play our part in tackling climate change by reducing emissions that cause global heating.
We developed a climate transition plan to introduce multi-year, science-based targets. We follow a three-step approach:
First, we understand the environmental impact of our operations and extended value chain. Each company conducts a materiality assessment, an ESG performance assessment, and a ‘deep dive’ mapping exercise for the purpose of carbon accounting.
Second, we apply the highest industry standards and targets, guided by global best practice and science-based frameworks.
Third, we identify scalable technology, partnerships and strategies to reduce environmental impact and improve performance.
GHG emissions reporting
We work closely with our subsidiaries to build a diligent greenhouse gas (GHG) emissions inventory accounting and reporting process. Given the diversity and varying maturity of our investee companies, the material impacts and how to define them vary between businesses.
The process of GHG data reporting is operational and company-specific. When compared to the financial accounting processes for listed and non-listed companies, we observe that carbon accounting for private companies is still in a nascent stage.
During the first 12-24 months after acquisition, we start with building awareness for our investees on the need for climate action and providing the tools for enhanced GHG accounting.
This includes analysis of factors such as electricity consumption by buildings, fuel consumption attributed to company cars and generators, and the environmental footprint of information technology hardware.
Oversight over these assets and the implementation of solutions for GHG reduction activities is operationalised at individual company level. We want to ensure that our GHG accounting and reporting approach is reflective of this reality and allows us to set targets that can be delivered on by the entities that carry the ability to do so.
Risks and opportunities
We have assessed the climate-related risks and opportunities for the group, which resulted in an identification of some clear opportunities to enhance the ESG profiles of our portfolio companies and thereby increase our ability to raise capital, enhance the valuations of these companies and reduce their operational risks. For a deeper insight into these risks and opportunities, please see our TCFD disclosure and our CDP submission below.
Carbon and climate action
Enhanced environmental disclosure is a key element of our commitment to net zero, and a demonstration of the importance we attach to climate stewardship across the group. We have made significant steps in the last two years on our disclosure of environmental data, using the GHG Protocol framework, which you can find below. In the GHG boundaries document, we define our approach to GHG accounting.
Further details of our climate strategy can be found here:
Task Force on Climate-related Financial Disclosures (TCFD) disclosures
Boundaries and scope of our greenhouse gas accounting
Packaging & waste
We invest in businesses that are operators of digital platforms and are web-based, which means they mostly have office spaces and websites from which their environmental impact stems.
Packaging, however, is a material resource used in the value chain of our food delivery and etail companies. Delivery of ready-made food, groceries and consumer products require packaging for protection and safety. The scope of influence on the use and choice of packaging differs for the platforms. For the food delivery platforms, the restaurants that sell their food, use and choose the packaging used. For the delivery of consumer goods on etail platforms, packaging is both used by the seller, or by the platform itself. Equally the portfolio companies that use packaging are all engaged by us to develop specific solutions to reduce the impact of use of packaging.
Through a specialised working group at the Prosus’s group level for all our portfolio companies that use packaging, we are focused on identifying scalable and systemic sustainable packaging solutions. Over the coming year, a landscaping study will be used to identify sustainability packaging solutions and suppliers, as well as working on shared themes like reuse and reduction.
Group-wide at Prosus, adoption of new regulations which aim to reduce waste and packaging, such as India’s recent ban on single use plastic, is critical. This is often expanded into the value chain of the food delivery and etail platforms by supporting partners like restaurants and sellers on an etail platform in identifying new or different materials and suppliers, so they can meet new regulations. Collaboration externally and internally is important to drive this topic.
The approach we advocate to addressing packaging and packaging waste is threefold:
First, manage the impacts from the use of packaging requires the footprinting and accounting of the packaging used. The different portfolio companies, like Swiggy, IFood and eMag are all investing in processes and methodologies to measure and size the packaging footprint in their value chain.
We promote a high granularity of footprint data, identifying volumes per material, type, size, design and other relevant aspects of packaging. Ultimately, we expect the footprinting is used to set measurable and smart targets to reduce impacts. For example, ifood has committed to go to zero pollution in its deliveries.
Secondly, the portfolio companies are committed to reduce the impact, meeting the highest international standards, and developing and implementing of several programs, that are focussed on: (1) reduction of packaging, (2) more sustainable (such as biodegradable and compostable) and recyclable packaging and (3) improving the recycling system. These programs each with investments in technology, marketing, new products and partnerships.
Some examples of the three programs from the portfolio companies are listed below:
- eMag replaced cardboard boxes with metal cages to transport parcels in bulk. Also, pallets are now being reused and, when possible, orders from vendors are consolidated.
- In 2020, iFood started a pilot scheme for an opt-in/ opt-out option that gave customers the choice not to receive unwanted disposable items like cutlery, straws and cups and also helps restaurants to save money on purchases.
- Sustainable and recyclable packaging
- eMAG increased the use of recycled paper instead of plastic (bubble) packing material, to protect customers’ items in transit in an environmentally friendly way.
- iFood offers sustainable packaging in its iFood Shop (the materials-purchase service for restaurants) – plastic-free products made from renewable sources such as paper, sugar cane and cassava fibre.
- Better recycling
- iFood provides an app to its customers that helps them recycle packaging
- iFood has invested in improving the recycling system through customer campaigns, and in collaboration with recycling experts is running a pilot with a city in Brazil to understand how to improve its recycling system and make it more efficient.
Thirdly, we encourage the portfolio companies to identify and engage with scalable technology, partnerships and strategy to structurally and systemically reduce environmental impact and improve performance. For instance, ifood has partnered with Xprize
, that is rallying up investors, innovators and entrepreneurs to create a new type of packaging that is sustainable and scalable and complements existing waste management infrastructures.
Nature supports all of human life, and all economic activities. But the ability of nature to continue providing essential goods and services such as food, clean water and climate regulation is in decline. We can no longer take nature for granted.
New leading framework
The UN Convention on Biological Diversity will agree a new international framework in 2022, and the current draft states that businesses should assess and report on their dependencies and impacts on biodiversity, from local to global, and progressively reduce negative impacts by at least half and increase positive impacts. We commit to aligning with the new framework in 2023. To prepare for the new reporting standards, we will conduct an analysis in 2022 to understand biodiversity risks and opportunities, as a first step towards building internal accountability across our portfolio of companies.
Risk and opportunities
We apply our risk framework based on six capitals, including natural capital, to monitor and assess (potential) risks and opportunities at corporate level, under the responsibility of global head of sustainability. The identification of ESG risks and opportunities at portfolio level is the responsibility of the management teams of the portfolio companies. At Prosus level we ensure oversight and drive action along the highest ESG standards through regular exchanges and deep engagement with our portfolio companies. We will be looking to using the upcoming UN convention as one of these standards.
A number of our majority controlled companies are engaged in important biodiversity projects that help them make important impact on their natural environment while conserving nature and delivering ambitious GHG emissions reductions goals:
- Central and Eastern European etailer eMAG has initiated a longterm project via its sustainability partner Foundation Conservation Carpathia (FCC) to reduce CO2 emissions from deforestation and forest degradation. The aim is to create a 200 000-hectare national park and wildlife conservation area in Romania, a European counterpart to Yellowstone.
- Brazil’s iFood has committed to be carbon-neutral by 2025, and has partnered with NGO SOS Mata Atlântica Foundation to plant seedlings in the Mata Atlântica (Atlantic forest) area, the largest reforestation project in Brazil. The foundation works in 17 states and has already planted 40 million seedlings.
We understand that business has a new, and important role to play in driving progress towards a nature positive future. As reporting standards on biodiversity evolve, we will adapt our practice in line with the benchmark frameworks and support our companies in their efforts to halt global loss of biodiversity and degradation of ecosystems and report on progress.