Global Markets - Sustainability Services Learn more at Confidential The Value of Reporting Corporate Climate Change Information: A Case Study of the Top 200 Federal Suppliers 15 March 2011

Agenda 2 Copyright © 2011 Accenture All Rights Reserved. Case Studies of Companies at the Leading Edge What is the Carbon Disclosure Project The Value of Reporting Corporate Climate Change Information How are the Largest Federal Suppliers Benefitting

The Carbon Disclosure Project launched in 2000 to accelerate solutions to climate change by putting relevant information at the heart of business, policy and investment decisions.

551 Institutional Signatory Investors 3,000+ Number of Companies reporting via CDP in 2010 $71T AUM represented by CDP’s signatory investors 82% 82% Proportion of Global 500 companies reporting via CDP in % 70% Proportion of S&P 500 companies reporting via CDP in CDP Supply Chain Members in 2010 CDP – Overview 4

CDP Supply Chain “Our analysis suggests that for consumer goods makers, high-tech players, and other manufacturers, between 40 and 60 percent of a company’s carbon footprint resides upstream in its supply chain—from raw materials, transport, and packaging to the energy consumed in manufacturing processes. For retailers, the figure can be 80 percent.” McKinsey Quarterly, 2008

The CDP Questionnaire inquires about: Management: – Strategies, Targets, Emissions reduction activities Risks & Opportunities: – Regulatory, Physical, Other Emissions & Energy reporting: – Energy use, Greenhouse gas emissions CDP – Asking the right questions 6

The Value of Corporate Reporting through the CDP Q) Has the process of gathering and disclosing your firm’s climate change data through CDP directly resulted in any of the following outcomes: Raised climate change awareness in firm Positively impacted company’s reputation Moved firm toward emission reductions Identified emission hot spots / energy efficiency opps. Fulfilled customer expectations Improved profitability 7

Reduction activities reported by suppliers have achieved savings of 32 million tonnes of carbon dioxide equivalent and £221 million. With 83% of companies now achieving emissions reduction, further efficiencies should be achieved in the future provided evidence that average supplier performance was maintained or improved in all aspects of carbon management compared with Government suppliers are providing insight into an array of implemented and planned measures that deliver significant reductions in carbon and cost, which contribute to operational efficiencies. We are participating in this programme as it is key for identifying financially viable energy efficiency opportunities … This is helping us not only to save money from procurement processes, but also rightly to practise what we are asking others to undertake. - Martin Powell, Mayor of London’s environment advisor. Efficiency and Value of Reporting – Findings from CDP 2010 Source: CDP Public Procurement Report 2010CDP Public Procurement Report

Office based organisation saved 95% of their energy consumption by consolidating their computer terminals into one after measuring their emissions and discovering that computers were responsible for the vast majority. This saved them $500,000 per annum. Before they measured their emissions they did not consider this a business issue. Benefits of Reporting for small businesses The CDP response has highlighted our need to address climate change issues within the company. Our suppliers in turn are now adopting a "green" policy which we hope to be able to disclose in the 2011 CDP questionnaire. Business Furniture Direct The CDP response has highlighted our need to address climate change issues within the company. Our suppliers in turn are now adopting a "green" policy which we hope to be able to disclose in the 2011 CDP questionnaire. Business Furniture Direct In compiling the response, our organization has become aware that climate change issues can be addressed relatively quickly and without considerable expense. C W Fletcher & Son Ltd - (Precision Engineering for Aerospace) In compiling the response, our organization has become aware that climate change issues can be addressed relatively quickly and without considerable expense. C W Fletcher & Son Ltd - (Precision Engineering for Aerospace) 9

Identified the largest Federal contractors (by FY 2009 revenue) that voluntarily responded to the 2010 CDP Information Request AND made their response publicly available Accounted for over $161 Billion in Federal contracts in FY 2009 Accenture and CDP are working with GSA to evaluate the climate change reporting and management practices of the Top 200 Federal contractors 10 Copyright © 2010 Accenture All Rights Reserved.

Copyright © 2011 Accenture All Rights Reserved. 11 By investing in emission reduction projects, the Top 200 Federal contractors are reporting monetary savings of nearly $5.0B, and annual emission reductions of 203M mtCO 2 e. Money Invested in Emission Reductions ($Millions) Money Saved ($ Millions) Health Care Financials Materials Industrials Information Technology Utilities * Foreign currencies were converted May 31, 2010 using OANDA Impact of Emission Reduction Investments (bubble size indicates amount of CO 2 e reductions) Energy Consumer Staples Telecommunications Consumer Discretionary

Energy efficiency and clean energy are common approaches to reducing Scopes 1 & 2 emissions 12 Copyright © 2011 Accenture All Rights Reserved. Common Approach Across Sectors Energy Efficiency  Lighting upgrade  Energy control modifications  Capital improvements Utilities and Consumer Staples Energy Generation / Distribution  Solar  Wind  Biomass  Cogeneration Plants Industrials Transportation  Increased use of rail  Alternative transportation fuels  Fuel-efficient vehicles Industrials and Consumer Staples Logistics  Route optimization  Reduced idle time  Limited top truck speed Financials Data Centers/ Green IT  Data Centers  PC power mgmt  Energy Star Equipment Financials, Health Care & Industrials, Information Technology Real Estate  High performance buildings  Reduce real estate footprint (rationalization) Additional Emission Reduction Activities Other  Reduce/ recycle waste  Capturing landfill emissions  Waste-to-energy Technology  Non-CO 2 GhG Reductions  Carbon Offsets  Renewable Credits

Specific investments among the Top 200 companies illustrate the innovative ways companies are reducing costs and reducing emissions 13 Copyright © 2011 Accenture All Rights Reserved. Company Emission Reduction Project Monetary Investment Monetary Savings Annual Emissions Reductions Achieved (mtCO 2 e) Energy Efficiency machinery and equipment projects $ 1.54M$ 1.63M29,868 Switched fuels from coal to natural gas $ 550M $ 27.5M (in year 1) 2,000,000 Fuel oil was replaced by agro-waste $ 0$ 130,0004,000 Use of event recorders and employee training to improve fuel efficiency $ 18M$ 32.5M56,000 Server consolidation, decommissioning, virtualization and cloud computing. $ 450M$ 720M709

Several of the Top 200 Contractors are working with suppliers to improve GhG performance 14 Copyright © 2011 Accenture All Rights Reserved. The common goals of companies addressing supply chain emissions : Calculate GhG emissions in the supply chain Estimate the proportion of the organization’s total GhG emissions in the supply chain Work across suppliers to develop a strategy for GhG reductions Establish procurement criteria to evaluate supplier performance on GhG emissions

15 Copyright © 2011 Accenture All Rights Reserved. Provides new insights into energy efficiency and cost reduction opportunities Improves profitability and organizational reputation Meets growing public demand for smaller organizational footprint Increases engagement / cooperation with suppliers −Builds new opportunities to reduce emissions and costs −Improves reporting process and results in a more complete GhG inventory report Drives entity-wide improvement in data collection, reporting and operational efficiency….and spurs innovation Why is Collecting and Reporting Climate Change Information Valuable???

For Follow-up Questions 16 Copyright © 2010 Accenture All Rights Reserved. Kevin Eckerle Accenture, Sustainability Services Two Commerce Square 2001 Market Street, Suite 2400 Philadelphia, PA Leah Stern Carbon Disclosure Project Senior Project Manager 6 West 48th Street, 10th Floor New York, NY, USA,