Ayala Land, a pioneer in sustainability in the Philippines, began its journey to reduce emissions in 2007 by assessing its carbon footprint and overall environmental impact. The company adopted proactive measures to reduce its resource consumption, through design changes, innovative technology, and influencing company behaviors and culture. Over time, Ayala Land refined its approach and directed its efforts towards managing emissions within its direct (Scope 1) and indirect (Scope 2) control, setting clearer decarbonization targets in 2017 and again in 2021, as the science of climate change mitigation measurement evolved.
The “Carbon Neutrality 2022” initiative was launched in 2017 with the aim to reduce Scope 1 and 2 emissions across its commercial properties. This involved shifting to renewable energy sources through power purchase agreements bundled with quality Renewable Energy Certificates (RECs). Additionally, Ayala Land initiated forest carbon projects in its private properties to remove emissions from the atmosphere, offsetting the impact of Scope 1 emissions.
By 2022, the program had succeeded in shifting 91% of commercial properties’ gross leasable area (GLA) to renewable energy sources or power accompanied by quality RECs. Additionally, four out of six carbon forest projects produced 8,732 tCO2e credits. This contributed towards a reduction in Scope 1 & 2 emissions to 14% of business-as-usual levels. With most of its leasing properties already operating with clean energy, the company was ready for the next phase of its decarbonization journey: the reduction of emissions in its supply chain, or Scope 3.
1 Market-based emissions for Scopes 1 and 2 calculated using the GHG Protocol Corporate Accounting and Reporting Standard.
2 Scopes 1 & 2 gross emissions based on business-as-usual (BAU) of commercial properties (malls, resorts and hotels, offices).
3 2022 carbon sinks are calculated by CCI PH and verified by Carbon Check. 2023 and 2024 are estimated carbon sinks based on
projections by CCI PH. Remeasurement and verification shall be done 5 years after 2022 or by 2027.
In 2021, the Ayala Group made a pivotal commitment to achieve Net Zero Greenhouse Gas (GHG) emissions by 2050, along with its sister companies, reducing Scopes 1, 2 and 3 emissions to zero by 2050. This aligns with the imperative to limit global warming to 1.5°C through rapid and deep emission reductions. To set credible targets, Ayala Land’s Strategic Business Units (SBUs) contributed to the baseline of the company’s GHG inventory for Scope 1, 2 and 3. The Net Zero Task Force, comprising sustainability leaders and key stakeholders from Ayala Land’s various businesses and overseen by the corporate sustainability unit, identified key “hotspots” sources and developed initial interventions.
This initiative culminated in 2022 with a comprehensive assessment of Ayala Land’s operational and supply chain emissions hotspots. The company finalized a high-level net zero roadmap with SBTi-aligned targets for 2030 and 2050, and ambitious adoption rates verified by the South Pole Group, a global decarbonization consulting firm. The Net Zero Task Force identified additional interventions in 2023, conducting pre-feasibility studies and engaging with members of Ayala Land’s supply chain, most notably its steel, cement and Polyvinyl Chloride (PVC) suppliers.
In 2024, SBTi verified Ayala Land’s science-based net-zero emissions reduction targets for the near and long term.
Near-Term Targets | Long-Term Targets | ||
| Reduce absolute scope 1 and 2 GHG emissions by 42% by 2030 from a 2021 base year*. | Reduce absolute scope 3 GHG emissions by 29.4% by 2030 from a 2021 base year*. | Reduce absolute scope 1 and 2 GHG emissions by 90% by 2050 from a 2021 base year*. | Reduce absolute scope 3 GHG emissions by 90% by 2050 from a 2021 base year*. |
Net-zero GHG emissions across the value chain by 2050 | |||
| *The target boundary includes land-related emissions and removals from bioenergy feedstocks. | |||
Aside from Net Zero and Circular Economy targets, we have also set 2030 targets for the following:
The baseline revealed that 95% of Ayala Land’s emissions footprint came from Scope 3 sources, with “purchased goods and services” as the primary contributor, encompassing materials such as steel, cement and PVC. As experienced by many companies on the net zero journey, achieving net zero emissions presents significant challenges, requiring advancements in technology and supportive policy frameworks. Ayala Land is committed to prioritizing cost-neutral and readily available technologies to mitigate emissions, leveraging the coming years to implement changes and collaborate with supply chain partners to transition towards a renewable energy future conducive to achieving net-zero emissions.
Aside from shifting the properties to renewable energy sources, the business units and project development leads identified additional interventions which were implemented in 2023 and 2024. This included conducting feasibility studies on readily available technologies to mitigate emissions and engaging with supply chain partners, most notably its steel, cement and PVC suppliers.
Ayala Land has conducted a thorough inventory of the company’s Scope 1, 2 and 3 emissions, covering all activities across the business lines from 2021 to 2024. The company engaged South Pole for the re-measurement and recalculation of GHG emissions based on the actual business and operational activities of the company.
The table below summarizes the preliminary results of the recalculation of GHG emissions from 2021 to 2024.
Notes:
1. Emission calculations for 2021 to 2024 are based on actual operational data or spend data from across the organization, including Biogenic CO2.
2. Land Use Change (LUC) emissions under Forest, Land and Agriculture are Ayala Land internal calculation based on GHG Protocol Land Sector and Removals Guidance (Draft for Pilot Testing and Review, September 2022).
3. Scope 3 under categories of upstream leased assets, downstream transport, processing of sold products and franchises are not applicable to Ayala Land’s operations.
Ayala Land’s journey to net zero shows the company’s continued commitment to responsible development and sustainable operations throughout the organization.
| Date | Milestone and Details |
|---|---|
| December 2016 | Management approves Carbon Neutrality pathway for Scopes 1 and 2 |
| September 2019 | Carbon Forests’ complete stock assessment and measurement undertaken by Center for Conservation Innovations (CCI PH) |
| November 2021 | Ayala Group committed to be Net Zero Working Groups |
| March 2022 | Sustainability unit organized Net Zero Working Groups |
| August 2022 | Completed baseline (2021) GHG inventory (Scope 1, 2 and 3 with consultant South Pole Group |
| November 2022 | Set SBTi-aligned 2030 & 2050 targets and identified initial interventions to decarbonize |
| December 2022 | Finalized high-level (Ayala Land parent level) Net Zero (NZ) roadmap and organized NZ Task Force (NZTF) to close the remaining emissions gap |
| January 2023 | Assigned NZTF cluster leads to ensure buy-in of business units and supply chain |
| February to July 2023 | Carbon Forests complete remeasurement and verification by Center for Conservation Innovations Philippines (CCI PH) and Carbon Check India (CCI) |
| April 2023 | Re-engaged consultant South Pole Group to assess emissions reduction of new interventions |
| July 2023 | Forest carbon stock and carbon removals from four (4) CF sites were determined and verified |
| May to November 2023 | SBUs thru NZTF submitted new interventions and revised adoption rates of existing ones; scheduled SBTI assessment (March 2024) |
| July, September, October and December 2023 | Completion of Rounds 1 to 4 net zero assessment reports |
| September 2024 | The Science Based Targets Initiatives (SBTI) verified Ayala Land Inc’s science-based net-zero emissions reduction targets for the near and long term |