Company and Product Sustainability Analysis: Air Canada
Assignment #3: Company and Product Sustainability Analysis Fall 2022 OVERVIEW The assignment should be completed in full-sentence prose, approximately 5-6 pages in length (singlespaced, 2500-3000 words of text, not including illustrations or references). This is intended to be a coherent, well-edited, well-organized document – not just a series of answers to the suggested questions. You should support your conclusions with outside sources, including references to marketing, reporting, or other materials from the company itself. Peer-reviewed academic sources would be a very good thing to include. Please document your sources appropriately, using APA-style citations and referencing. Information about how to use APA style will be provided on Quercus. The assignment will be submitted automatically for a textual similarity analysis. You won't have to make a separate submission; it is integrated with Quercus. See the Syllabus and Academic & Writing Resources on our Quercus site for more information about this. OBJECTIVES In completing this assignment, you will: • apply an understanding of the dimensions of sustainability to a critique of a company, program, or product; • critically analyse and deconstruct advertising claims in the context of sustainability; • consider various ways in which a company or product might be considered “sustainable” (or otherwise) along its entire production or supply chain, and in the broader context of the sector; • make recommendations regarding possible improvements to a company’s or product’s sustainability. INSTRUCTIONS & STEPS 1. Identify a company, program, or product that highlights “sustainability” or one of its aspects (environment, social equity, etc.) as a core part of their brand. What does the company do (and/or) what is the nature of the product or program that you have chosen to investigate? You can find some ideas by looking at the list of GRI (Global Reporting Initiative) Community Members: https://www.globalreporting.org/reporting-support/member-and-commercial-partner-directory/# 2. What is the company, program, or product’s claim to sustainability? Does the company use the term “sustainability” or “sustainable”? In what ways? Summarize this, with examples from the company’s website or other advertising (Facebook, print, etc.). Note that a product could be interpreted as sustainable, even if that term is not used to describe the product; on the contrary, a product that is described as “sustainable” might not be. 3. Find out whether the company issues an annual sustainability report; if so, read some of them. Alternatively, does the company’s annual financial report to shareholders mention any aspects of sustainability? How is their sustainability report structured? Does the company report according to GRI or another standard sustainability-reporting framework? If not, should they? You could look at the UN Global Compact, which now has the largest database of sustainability reports: https://www.unglobalcompact.org/what-is-gc/participants 4. Is this company or product ranked on any recognized international sustainability standards (or does it have any other related rankings or certifications, such as environmental certifications)? You could look at You might also be interested in checking out the IFRS International Sustainability Standards Board at https://www.ifrs.org/groups/international-sustainability-standards-board/, which is aiming to establish internationally accepted standards for corporate sustainability reporting. 5. Does the company’s sustainability claim have an environmental basis, such as decreased packaging or carbon neutrality? Or a social basis, such as ensuring good working conditions? Or an economic basis, such as a fair trade agreement with suppliers? Or a political/institutional basis, such as joining with other companies for more effective monitoring within the sector? Or is it a combination of these? Or none of them? (If you don’t see any evidence that the claim is based on any real positive actions, then is it a bogus or over-stated claim? An example of “greenwashing”…?) 6. Do you think this company (or program or product) has built an honest brand around sustainability? Examine this from three perspectives: a. Do you see evidence that they are actually doing what they claim to be doing? b. Do you think it’s working, and having a positive impact? c. Can these efforts really be termed “sustainability”? (For example, if the claim to sustainability is based on reduced packaging, would you consider that to constitute “sustainability” on its own?) Support your position with a written discussion. 7. What else do you think this company could (or should) be doing to become more sustainable, to better support or validate their claim to sustainability, or to be a sustainability leader in their sector? What types of things are being done towards sustainability goals by other companies in the same sector? If this company hired you to advise them on how to improve their sustainability performance, what steps would you recommend?
Company and Product Sustainability Analysis
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Company and Product Sustainability Analysis
Introduction
Air Canada (/us/en/aco/home.html) is a flag carrier, and the largest airline in Canada in terms of size and passengers handled. Founded in 1937, Air Canada is headquartered in Saint-Laurent, Montreal, Quebec. It is one of the world’s oldest airlines. Air Canada originated when the Canadian federation government created Trans-Canada Air Lines (TCA). A year later, TCA started its transcontinental flight routes. In 1965, the government approved the renaming of TCA to Air Canada. The privatization of the airline was completed in 1988. Currently, the airline offers direct service to six continents, with 222 destinations around the globe. The carrier has a fleet of more than 400 aircraft (Air Canada: About Air Canada, n.d.). The governance structure of Air Canada includes an 11-member Board of Directors. These are committed to maintaining high standards of corporate governance in all aspects of the carrier’s affairs. Over the years, Air Canada has launched numerous operating divisions to cater to the specialized needs of the market.
Claim to Sustainability
The term “sustainability” is part of Air Canada’s branding. The company has prioritized environmental sustainability. The airline claims to make efforts towards integrating environmental considerations in its operations to reduce its environmental footprint. In this regard, Air Canada seeks to ensure that it leaves less carbon dioxide in the atmosphere, less waste on land, and less noise in communities (Air Canada: Environment, n.d.). The business claims to have taken more measures aimed at addressing environmental issues. For instance, it claims to have taken steps to enhance collaboration and participation with industry partners, communities, staff members, and clients to have a greater impact on the efforts towards the environment.
Figure SEQ Figure \* ARABIC 1: Air Canada's commitment to environmental sustainability
Moreover, Air Canada’s management, led by the CEO Michael Rousseau has promised to take measures towards sustainability. The CEO demonstrates that Air Canada is a global airline, which brings about global responsibility with people looking towards the airline to address some of the planet's major challenges. Rousseau demonstrates that while airlines generate a relatively modest 2% to 3% of greenhouse gasses (GHG), carriers still expect to do whatever it takes to curtail GHG emissions. The CEO demonstrates that Air Canada remains committed to whatever it takes to reduce emissions and enhance sustainability. Such a message from the CEO indicates that Air Canada values sustainability and continues to make changes aimed at enhancing the same.
Figure SEQ Figure \* ARABIC 2: A message from Air Canada's CEO, Michael Rousseau, on the airline's commitment to sustainability
Annual Sustainability Reports
Air Canada has been issuing annual sustainability reports since 2011. In 2021, Air Canada issued a sustainability report titled “Citizens of the World: 2021 Corporate Sustainability Report.” The report was prepared according to the Global Reporting Initiative (GRI) Standards. GRI is an internationally recognized body that helps organizations to maintain transparency and consistency in sustainability impact reporting (The Global Reporting Initiative (GRI), n.d.). Further, the report outlines the airline’s carbon footprint, targets, and climate strategy based on CDP’s requirements, whose approach aligns with the Task Force on Climate-related Financial Disclosures (TCFD) framework. CDP is a not-for-profit charity that operates a global disclosure for businesses and countries to assist them in managing their environmental impacts. In the last 20 years, CDP has developed a system that allows stakeholders to engage in matters of the environment. Working with CDP is instrumental because it allows businesses to remain aware of the impact of its activities on climate change (Task Force on Climate-related Financial Disclosures (TCFD), 2022). Since the report adheres to the TCFD framework, the airline can demonstrate the climate-related financial risk to the relevant stakeholders.
The structure of the sustainability report is meant to provide an overview of the business and ultimately demonstrate the airline’s commitment to sustainability. In the introduction session, the report provides an overview of the report. In particular, the introduction outlines the reporting framework and third-party assurance. The sustainability mission is “to make meaningful connections and to care for and elevate one another as Citizens of the World” (Air Canada, 2022). There is also a message from the CEO where he indicates the achievements Air Canada continues to make toward sustainability. The CEO demonstrates that while the uncertainty of the pandemic defined 2020, the 85th anniversary in 2022 is a celebration of the milestones meant towards sustainability. While the effects of the pandemic are transitory, addressing sustainability risks and opportunities and creating more sustainable aviation requires a long-term commitment (Air Canada, 2022). The CEO believes that the 2021 suitability report is a major step towards demonstrating Air Canada’s determination through reporting its progress.
The report highlights the achievements the airline has made. Firstly, it indicates business achievements like new routes, launching digital solutions, and expanding partner networks. Secondly, people's achievements include the recalling of 10,000 workers in 2021, employees giving back to the local community, and the supply of 230,000 screening kits to employees (Air Canada, 2022). Thirdly, the planet's achievements highlight the progress towards cutting down emissions. The session also highlights the recognitions received. The future-oriented objectives indicate what the business aims to achieve in business, people, and plants.
Next, the report details the business of the airline. This includes fleet travel, aeroplan, new technologies, and cargo. The session also indicates the governance structure of the airline. It demonstrates its commitment towards human rights, privacy and cybersecurity, ethical business practices, and anti-corruption prevention, among others. The session also outlines the value chain, including the supplier code of conduct and practices integrated into the chain (Air Canada, 2022). The next part talks about people in detail. Here, the report demonstrates its commitment to safety. It also indicates how it cares for the clients, employees, and the community. Lastly, the report delves into plant issues. Here, the report shows how the business seeks to promote environmental management. In particular, the report emphasizes the need to do less; less carbon, energy, noise, and waste. It encourages people to do more upcycle and water conservation, contributing to biodiversity and sustainable scholarship (Air Canada, 2022).
Recognition in International Sustainability Standards
Air Canada became a community member of the GRI on 26th July 2018. GRI members allow the carrier to adhere to sustainability reporting beyond the enterprise alone (The Global Reporting Initiative (GRI), n.d.). As a result, the airline can attain environmental cohesion by using the reporting standards GRI has put in place.
Additionally, Air Canada is a signatory to the United Nations Global Compact (UNGC). The organization is a non-binding UN pact to encourage businesses to employ sustainable and socially responsible policies (Kingo, 2022). Air Canada has demonstrated its willingness to support the ten principles of UNGC. The principles cover human rights, labour, environment, and anti-corruption. At the same time, Air Canada supports the 17 Sustainable Development Goals (SDGs). Starting in 2020, Air Canada has aligned its reporting with the SDGs, a major step towards enhancing sustainability.
In 2020, Air Canada received the IATA Environmental Assessment program (or IEnvA) Stage 2. The airline worked with the International Air Transport Association (IATA) to get the certification. The certification focuses on environmental management and is specifically developed for the airline sector (IATA: IATA Environmental Assessment (IEnvA), n.d.). The certification shows the airline’s commitment to environmental compliance and management (Johnson, 2020). With the certification, Air Canada can integrate its existing environmental compliance activities into its operations. Getting IEnvA is a major milesto...