TCFD

The Board provides oversight on all ESG-related issues. To manage internal control of climate risks, the Board has delegated responsibility to the Audit Committee which works closely with the ESG Committee. The ESG Committee has specific oversight of ESG and climate-related matters.

The responsibility for managing climate-related risks is delegated to senior management throughout the Group by the ESG Committee. The Head of Group Risk Assurance who is a member of the ESG Committee, with help from the Group Communications and ESG Manager, coordinates the work between the Committee and Divisional management across the business.

In 2023, we further strengthened our overall ESG governance, creating a new dedicated role at head office by expanding the remit of the Communications Manager who is now the Group Communications and ESG Manager. This enables us to improve the coordination of the Divisional ESG Coordinator activities while allowing the Head of Group Risk Assurance to lead the climate change risk management.

Our approach is to ensure we provide our customers with products that take climate change into consideration. To do that, we have worked to understand the impact of climate change on the Group’s operations, strategy and financial planning. Adopting the TCFD recommendations within our existing risk management processes, has enabled us to develop a climate-risk impact framework. This framework considers transition, and physical risks and opportunities through climate scenario analysis in the short, medium and long term. A climate scenario is a plausible representation of a future climate that has been constructed for explicit use in investigating our future vulnerability to the impacts of climate change. We have assessed the potential impact of each physical and transition risk across our global operations. 

We conducted a third detailed climate scenario analysis in 2023, reassessing the analysis completed in 2022 to identify any changes in impact on our operational sites. We widened our climate scenario analysis to include all sites across the Group and 17 of our top supplier locations (five Production Solutions suppliers, seven Creative Solutions suppliers and five Media Solutions suppliers). Each Division provided information on the key supply route locations for analysis.

 More information can be found on pages 20-32 of the 2023 TFCD report.

As Climate Change is classified as a principal risk, the Board has ultimate responsibility for climate-related risks and opportunities. We have a well-established framework for assessing our risks and assigning mitigation actions from years of development in a competitive business landscape. Our climate risk management process is to identify, evaluate and address potential risks and opportunities associated with climate change to our operations.

Four interconnected steps were undertaken:

Step 1 – We identified risks through stakeholder engagement and risk workshops, involving stakeholders from the beginning to utilise their knowledge of Videndum. In total, eight climate-related risks and two opportunities were identified.

Step 2 – We assessed each risk and opportunity using our scenario analysis, accounting for the full range of each one’s potential impact. This allowed us to determine the material impact and rank each risk and opportunity.

Step 3 – Our risk management options were appraised. We recognise that all good decisions rely on the effective analysis of alternate options. A risk management response was agreed on depending on how it helped build our resilience to the climate-related issue.

Step 4 – Finally, we addressed each risk and opportunity, and controls were implemented to prevent, reduce or mitigate downside risks, or increase the likelihood of opportunities. We recognise that residual risks will remain and communicate this across the business at this stage. At a minimum, our management teams review risk exposures against business risk level tolerances annually.

We use a wide variety of metrics to measure climate-related impacts. These metrics consist of Videndum’s greenhouse gas inventory, including the Group’s Scope 1, 2 and 3 carbon emissions and our emissions reduction pathway, which is aligned with the Paris Agreement 1.5°C warming scenario.

Reducing the Group’s carbon footprint is a priority for Videndum. We engage external specialists to determine our carbon emissions to ensure accuracy, using the GHG Protocol as the basis of the calculations for our Scope 1, 2 and 3 emissions. Our 2023 Scope 1 and 2 emissions represented 3.6% of our total Group emissions, with our 2023 Scope 3 emissions represented the remaining 96.4%. Due to the strikes by US writers and actors in 2023 , the Group had a very difficult year, however, we continued to invest in emission reduction initiatives where possible.

Our detailed Scope 3 inventory can be found in our TCFD and ESG Reports.

Scope 1, 2 and 3 emissions

<sub>1. We have re-stated our 2021 Scope 1 and Scope 2 figures which were previously 1,456 and 2,524 tCO₂e, respectively. These restatements are due to recalibration of our natural gas and electricity emissions. This has resulted in a slight increase in our overall emissions for 2021. Our Scope 3 emissions were also restated as improved business travel data was collected. Previously, the total was 154,550 tCO2e.
2. We have re-stated our 2022 Scope 1 and Scope 2 figures which were previously 1,467 and 2,773 tCO₂e, respectively. These restatements were due to recalibration of our natural gas and electricity emissions. Scope 3 emissions were also restated as improved business travel data was collected. The previous total was 173,148 tCO₂e.</sub>

This report summarises the energy usage, associated emissions, energy efficiency action and energy performance for the Group, under the government policy Streamlined Energy and Carbon Reporting (“SECR”), as implemented by the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018.

Total Consumption (kWh) figures for energy supplies reportable by the Group are as follows:

<sub>1. We have restated our UK and Global kWh figures across 2021 and 2022 as improved data quality has become available. These changes align with the restated emissions in Table 22.
2. Grey fleet is the use of employees’ personal vehicles for business purposes, as opposed to belonging to the Company</sub>.

The total emission (tCO2e) figures for energy supplies reportable by The Videndum Group plc are as follows:

Location-based

_{1. We have restated our 2021 and 2022 emissions totals to incorporate improved data quality. Previous totals equalled 4,265 and 4,005 tCO₂e for 2022 and 2021, respectively}

An intensity metric of tCO₂e per £million turnover applied for the annual total consumption.

 _{1. We have re-stated our 2021 intensity metrics as a result of now applying a UK only specific £m revenue value to UK only emissions. This methodology has also been applied to global (excluding UK) intensity metric calculations. i.e., applying a global (excluding UK) only £m revenue value to global (excluding UK) emissions}.

The Group is committed to year-on-year improvements in our operational energy efficiency. A register of energy efficiency measures has been compiled and will be implemented within five years.

Measures undertaken in 2020:

• The pandemic reduced Group carbon emissions in 2020 – it was anticipated that as the pandemic subsides and regular work practices resume, carbon emissions will increase in 2021.
• Many buildings within the Group have timer and motion sensors for lighting to save on electricity usage.
• The majority of the Group’s sites were working towards installing LED lighting throughout.
• In Feltre, Italy, 220-240W neon lights were replaced with LED bulbs resulting in a 58,000kWh reduction and a cost saving of £11,000 per annum.
• The Feltre facility installed new air compressors with an energy saving inverter system. Other buildings have programmable thermostats that are centrally managed to optimise heating and cooling needs.
• Electricity at Bury St Edmunds, UK, and Cartago, Costa Rica, facilities are supplied from renewable energy sources.
• The electricity contracts with Green Certificates at our two main sites in Italy were renewed in 2017 until 2021.
• Sites in Italy, Bury St Edmunds and Costa Rica maintained their ISO 14001 compliance which were renewed in 2020.

Measures undertaken in 2021:

• Solar PV installation to the roof of the Cartago site in Costa Rica, has been implemented and commissioned in Q1 2022.
• The installation of 11, high-efficiency air compressors at the Feltre site, Italy, resulted in a 20% energy reduction and cost-saving of €15,000 per annum.
• Power supply contracts at the Feltre, Ashby and Byfleet sites have been moved to REGO backed supplies guaranteeing energy from renewable sources.
• The Byfleet site has installed insulation in the roof void to reduce the gas usage requirements associated with space heating.
• Across the Media Solutions Division, the reduction of business travel by 25% since 2019 has resulted in a €500,000 per annum saving.

Measures undertaken in 2022:

• Solar PV installation to the roof at the Bury St Edmunds site has commenced and is due for commissioning in Q1 2022.
• Other Videndum sites will be assessed for the feasibility of insulating Solar PV.
• The transition to LED lighting in the Feltre, and Ashby-de-la-Zouch sites by 2023 will result in an estimated 80% energy reduction and cost savings of €70,000 per annum.
• Car fleets across the organisation are converting to full hybrid or electric with 40% of vehicles now converted and 100% planned by 2024.

Measures undertaken in 2023:

• Solar panels installation to the roof of Media Solutions’ facility in Feltre, Italy.– 30% expansion of solar panels at Production Solutions’ site in Cartago, Costa Rica.
• 33.3% of Production Solutions’ vehicles were hybrid or electric at the end of 2023, compared to 27.3% at the end of 2022. – Media Solutions has converted 80% of Company vehicles to electric (2022: 54%). – Creative Solutions does not have a car fleet.
• The Bad Kreuznach, Germany, Tokyo, Japan and China offices now use 100% LED lighting. – Media Solutions’ Ashby-de-la-Zouche, UK site converted an additional 20% of lighting to LED saving an estimated 0.7t C02. – Up to 90% of all lights are now LED in both our Production Solutions Bury St Edmunds, UK and Cartago, Costa Rica sites.– LED lights were installed at Creative Solutions’ Los Angeles, US site towards the end of 2023.
• 25% completion of energy metering and circuit level monitoring was implemented in Feltre, Italy which is an estimated saving of 10 tCO2e.
• A total of seven sites have renewable energy contracts, as at the end of 2023. The sites are: Richmond, Twickenham, Byfleet and Bury St. Edmunds, UK; Irvine, US; Cassola and Feltre, Italy. Cartago, Costa Rica is not technically on a renewable contract, however, the energy is from a clean, hydroelectric source. 
• Anton/Bauer, a brand within Production Solutions, has launched a sodium-based 9kWh mobile power source called Salt-E Dog, which delivers consistent and reliable energy and addresses the pressing issue of carbon emissions associated with traditional fossil fuel or lithium generators.
• We have confirmed plans to lease one-third of the area at our Shelton, US site, reducing the size of the site leased by the Group. We have also switched all the lighting to LED and checked all HVACs to ensure compliance with the latest energy efficiency standards.
• 70% completion of compressed air leak detection and repairs in Feltre, Italy. – 30% implementation of heating and air conditioning controls in Feltre, Italy.

Methodology

Scope 1 and 2 consumption and CO2e emission data for UK sites have been calculated according to the 2019 UK Government environmental reporting guidance and the GHG Protocol. The current kWh gross calorific value (CV) and kg CO2e emissions factors relevant to reporting year 1 January – 31 December 2023 were applied. Scope 3 emissions have been calculated based on the guidance in the GHG Protocol Corporate Value Chain (Scope 3) Standard.

Scope 1 emissions

Direct emissions from our own operations e.g. fuel combustion. Scope 1 fuel consumption – natural gas, transport fuel and other fuels – are converted to CO2e figures using conversion factors outlined below.

• To convert Scope 1 (Company fleet and natural gas) and Scope 3 (grey fleet) usage in the UK, the UK DESNZ 2023 emissions factors database was used. For the US, the United States Environmental Protection Agency GHG Emissions Factors Hub 2023 was used. For Australia, the Australia National GHG Account Factors 2022 database was used. For remaining countries, we default to the UK DESNZ 2023 emissions factors database.

Scope 2 emissions

Indirect emissions generated from purchased electricity. Scope 2 emissions are calculated based on both the “location” and “market” methods outlined in the GHG Protocol. Scope 2 country-specific electricity emissions factors were used on the sources in the table on page 56 to 57.

Location-based methodology

Methodology to calculate Scope 2 emissions using the average electricity grid emission conversion factor of a region. For all UK facilities we use the DESNZ 2023 conversion factors. For all non-USA facilities, we use national carbon conversion factors for grid purchased electricity from a variety of published sources; including national grid suppliers and government agencies (see table on next page). For USA sources we use the latest regional intensity factors available from the Environmental Protection Agency’s Emissions and Generation Resource Integrated Database (eGrid). Emissions associated with the use of purchased electricity (Scope 2 emissions) were calculated using country-specific electricity emissions factors as per the sources in the table below.

Market-based methodology

Methodology to calculate Scope 2 emissions using electricity conversion factors specific to the contractual instruments in place for procured electricity. Where contract specific data was not available, location specific residual factors were used. Where neither is present, the location-based factor was used.

Scope 3 emissions

All the indirect emissions (excluded in Scopes 1 and 2) that occur in our value chain. For all Videndum sites, applicable Scope 3 categories were identified based on an operational control boundary. Scope 3 emissions for applicable categories were calculated following methodologies outlined in the GHG Protocol “Technical Guidance for Calculating Scope 3 Emissions”, with further guidance taken from the GHG Protocol’s detailed methodology chapters for each applicable Scope 3 category.

For UK sites, most conversion factors were sourced from UK Government GHG Conversion Factors for Company Reporting, v1.1 2023. Where a spend-based approach was used, as per the GHG Protocol guidance, conversion factors were taken from the University of Leeds and Department for Environment, Food and Rural Affairs’ “UK Footprint Results (1990 – 2018)” study or the Department for Environment, Food and Rural Affairs’ “Indirect emissions for the supply chain” database. Scope 3 emissions include Well to Tank and T&D losses.

For international sites, country-specific emissions factor databases were used where available. For example, for US sites, 2023 specific emissions factors were taken from the EPA GHG Emission Factors Hub and spend-based emission factors were sourced from a Quantis database.

Country-specific 2023 electricity emissions factors were used to estimate emissions associated with Categories 11: Use of Sold Products and 13: Downstream Leased Assets. These factors were taken from the sources outlined in the table below.

A third party uses the Company’s data to calculate emissions but no formal assurance is provided.