Change 2019 International Consolidated Airlines Group, S.A ...

International Consolidated Airlines Group, S.A. - ClimateChange 2019

C0. Introduction

C0.1

(C0.1) Give a general description and introduction to your organization.

International Airlines Group (IAG) is one of the world's largest airline groups. It is the third largest group in Europe and the sixthlargest in the world, based on revenue in 2018. IAG was formed in 2011 and is currently the parent company of: British Airways, theSpanish operators Iberia and Vueling, the Irish operator Aer Lingus and the European operator Level. In 2018, IAG had 573 aircraftflying to 268 destinations and carried over 113 million passengers, as well as cargo via the subsidiary IAG Cargo. IAG’s total revenuewas €24.4billion with €3.2 billion operating profit and RoIC of 17%, and the group employed the average manpower equivalent of64,734 people.

For the purposes of this survey, IAG Cargo operations are accounted for in both Iberia and British Airways disclosures. Leveloperations are accounted for in a separate disclosure.

As an airline, IAG’s largest impact on the climate comes from the burning of jet fuel in our aircraft fleet. This accounts for 99.8% of ourScope 1 emissions and 77% of our combined Scope 1, 2 and 3 emissions. We also have an impact via our ground operations – likethe use of baggage trucks and escalators – and from the energy used in our hangers, offices, lounges and other buildings.

IAG sees sustainability as fundamental to our long-term growth and has identified climate change as our most material environmentalissue. As part of working towards our vision to be the world’s leading airline on sustainability, we set short and long-term targets onour climate change impact and in 2018 we continued to take action to minimise our carbon footprint across our operations. We alsohave a rigorous approach to identifying and assessing climate-related risks. More details are in sections 2 and 3.

We believe that a collective response is the best way to address aviation’s climate-related impacts and are extremely active inhelping to shape national, regional and international climate-related policy instruments that affect the airline industry. More details arein section 12.3.

C0.2

(C0.2) State the start and end date of the year for which you are reporting data.

Start date End date Indicate if you are providing emissions data for pastreporting years

Select the number of past reporting years you will be providingemissions data for

Row1

January 12018

December 312018

No <Not Applicable>

C0.3

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(C0.3) Select the countries/regions for which you will be supplying data.AustriaFranceIrelandSpainUnited Kingdom of Great Britain and Northern Ireland

C0.4

(C0.4) Select the currency used for all financial information disclosed throughout your response.EUR

C0.5

(C0.5) Select the option that describes the reporting boundary for which climate-related impacts on your business are beingreported. Note that this option should align with your consolidation approach to your Scope 1 and Scope 2 greenhouse gasinventory.Operational control

C-TO0.7/C-TS0.7

(C-TO0.7/C-TS0.7) For which transport modes will you be providing data?Aviation

C1. Governance

C1.1

(C1.1) Is there board-level oversight of climate-related issues within your organization?Yes

C1.1a

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(C1.1a) Identify the position(s) (do not include any names) of the individual(s) on the board with responsibility for climate-related issues.

Position ofindividual(s)

Please explain

Board-levelcommittee

In terms of climate issues, the IAG Board is responsible for setting group sustainability commitments, reviewing the progress of climate-relatedobjectives and strategy, agreeing plans to meet carbon-related regulatory compliance such as with the EU Emissions Trading Scheme, and ensuringmanagement is effectively delivering on sustainability objectives and policies. All members of the board may also raise questions, or ask for evidenceof action on, or challenge aspects of our climate change programme.

Director onboard

In terms of climate issues, a non-executive director on the IAG Board chairs the IAG Audit and Compliance Committee. This committee isresponsible for approving key aspects of climate-related strategy (such as whether to support carbon pricing), major climate-related projects (such asour investments in sustainable aviation fuel) and agreeing internal audit programmes. They also review climate-related risks within our EnterpriseRisk Management (ERM) framework and determine whether these should be considered principal risks to IAG. They review how our sustainabilitycommitments align with wider risks and opportunities, strategy, financial performance and compliance.

ChiefExecutiveOfficer(CEO)

In terms of climate issues, the CEO is responsible for updating the Board, where decisions about our sustainability and climate change strategiesare agreed as well as decisions about major climate-related investments. The CEO chairs the IAG Management Committee and ensures thatdecisions made at Board level are directed into action across the Group operating companies.

C1.1b

(C1.1b) Provide further details on the board’s oversight of climate-related issues.

Frequencywithwhichclimate-relatedissues areascheduledagendaitem

Governancemechanismsinto whichclimate-related issuesare integrated

Please explain

Scheduled– somemeetings

Reviewing andguidingstrategyReviewing andguiding majorplans of actionReviewing andguiding riskmanagementpoliciesReviewing andguidingbusiness plansSettingperformanceobjectivesMonitoringimplementationandperformance ofobjectivesOverseeingmajor capitalexpenditures,acquisitionsanddivestituresMonitoring andoverseeingprogressagainst goalsand targets foraddressingclimate-relatedissues

The Board is responsible for approving the IAG sustainability strategy and annual disclosures, all major climate-related investments,and approving the risk management and control policy which also includes climate-related risks and opportunities. They approveclimate-related proposals, set or agree Group level energy, sustainability or climate targets, and can ensure that wider businessactivity is aligned with sustainability objectives and priorities. They also review the general business plans of each operating company,which look ahead five years – and have the opportunity to raise issues or questions in relation to the sustainability aspects of these.The Board debates climate-related issues at least twice a year. Updates are scheduled as part of a rolling planner and we arereviewing ways to improve this process on an ongoing basis. During 2018, the Group Head of Sustainability reported twice onsustainability issues to the Audit and Compliance Committee. The Audit and Compliance Committee and the Board revieweddisclosures in our Annual Report & Accounts, including progress on our emissions intensity targets and the implementation ofsustainability strategy. The mechanisms and processes described above ensure that IAG management has clear oversight of climate-related issues and plans at Group level and in each operating company.

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C1.2

(C1.2) Provide the highest management-level position(s) or committee(s) with responsibility for climate-related issues.

Name of the position(s) and/orcommittee(s)

Responsibility Frequency of reporting to theboard on climate-relatedissues

Chief Executive Officer (CEO) Both assessing and managing climate-related risks and opportunities Quarterly

Other, please specify (ManagementCommittee (Executive level))

Both assessing and managing climate-related risks and opportunities Quarterly

Environment/ Sustainability manager Both assessing and managing climate-related risks and opportunities More frequently than quarterly

Other C-Suite Officer, please specify(Chief of Staff)

Both assessing and managing climate-related risks and opportunities More frequently than quarterly

Risk manager Both assessing and managing climate-related risks and opportunities Half-yearly

Other committee, please specify (Auditand Compliance committee (Executivelevel))

Other, please specify (Non-Executive Director on the IAG Board sits on the IAG Auditand Compliance Committee which oversees delivery of the IAG sustainability strategy)Non-Executive Director on the IAG Board is Chair of the IAG Audit and ComplianceCommittee which oversees delivery of the IAG sustainability strategy.

Half-yearly

C1.2a

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(C1.2a) Describe where in the organizational structure this/these position(s) and/or committees lie, what their associatedresponsibilities are, and how climate-related issues are monitored (do not include the names of individuals).

The CEO of IAG has ultimate responsibility for climate related issues. The CEO has influence over all operating companies(“OpCos”) and provides a direct link between the IAG Management Committee (MC) and the Board of directors. Because climatechange is a group-wide strategic issue for us, this ensures that the highest level of management holds ultimate accountability fordirecting IAGs response.

The CEO reports quarterly to the IAG Board, who are responsible for approving the strategies and general policies of IAG as well asapproving the risk management and control policy which includes climate-related risks. The CEO is responsible for ensuring thatBoard-approved strategies and risk management plans are put into action across the Group and its operating companies. The CEOalso chairs the IAG Management Committee, which provides the channel to direct decisions made at the Board into action across theGroup operating companies. Via the Management Committee, the CEO is able to feed climate-related updates, proposals andrequests back up to the Board.

The IAG MC is the next highest level of governance for overseeing climate-related strategy. It is responsible for assessing progressagainst our climate targets and providing sign-off and guidance on projects such as sustainable fuels and fuel efficiency initiatives.They also support the CEO in assessing and managing climate related risks and opportunities within their respective areas ofresponsibility across the Group. This Committee includes the Director of Strategy, Group Chief Finance Officer, Chief of Staff,General Counsel, and CEOs of the Group operating companies. The IAG MC can check that our climate-related programmes alignwith wider aspects of the business such as IAG strategy, risk management process and innovation programme. They can channelupdates, proposals and requests relating to our climate programmes via the CEO back up to the Board.

The IAG Chief of Staff sits on the IAG MC and has overall responsibility for the development and implementation of sustainabilitystrategy, including climate-related issues. The IAG Group Head of Sustainability reports into the IAG Chief of Staff. There is a directline of accountability for our climate change programmes to be managed from director level to management level. In 2018, the IAGGroup Head of Sustainability reported to the IAG Audit and Compliance Committee twice, to review progress and gain approval forthe group sustainability strategy.

Each of the operating company CEOs are also responsible for presenting their climate change progress and plans to the IAG MC.This happens as part of an annual business planning process, with submitted plans covering a timeframe of the next five years. Thisensures that the highest level of management are made aware of best practice that can be shared group-wide or where collectiveaction is required to ensure progress against our goals. The MC provides a forum to discuss and agree proposed new policies andstrategies before presenting these for approval to the IAG Board (see answer to section 1.1b).

Further down the management structure, climate change programmes are maintained under the control of each airline and theirrespective Boards and management teams.

The IAG sustainability governance structures were published in our annual report 2016 and will be restated if there any futurechanges.

C1.3

(C1.3) Do you provide incentives for the management of climate-related issues, including the attainment of targets?Yes

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C1.3a

(C1.3a) Provide further details on the incentives provided for the management of climate-related issues (do not include thenames of individuals).

Who is entitled to benefit from these incentives?Environment/Sustainability manager

Types of incentivesMonetary reward

Activity incentivizedEfficiency project

CommentEnvironment and Sustainability Managers have KPIs around successfully delivering carbon pricing, fuel efficiency, carbonefficiency and sustainable alternative fuels projects. For example, IAG, British Airways and Vueling sustainability and environmentteams have these KPIs. Examples of key policy deliverables include successful lobbying for a market-based measure to regulateemissions from international flights, and lobbying for policy support to attract low-carbon fuel project developers to build theirrefineries in the UK and EU. A key climate mitigation project deliverable is achieving a sustainable aviation fuels production facilityin the UK. In addition, delivery of key projects such as the implementation of new Group-wide fuel efficiency software is incentivisedthrough individual performance related pay.

Who is entitled to benefit from these incentives?Energy manager


Activity incentivizedEnergy reduction target

CommentIAG offers monetary rewards for the successful delivery of energy reduction and efficiency targets. For example the Fuel EfficiencyWorking Group of British Airways is tasked with delivering a series of fuel savings projects in an effort toward meeting annual fuelsavings targets. This is a KPI-based deliverable and strong performance can result in a performance bonus. The Aer Lingus FuelManagement Committee is also assigned an annual fuel efficiency target and has implemented a number of fuel efficiencyinitiatives and projects towards delivering those targets. Delivery of key projects such as the adoption of more fuel efficient lightingin engineering and maintenance buildings is incentivised through individual's performance related pay.

Who is entitled to benefit from these incentives?Facilities manager


Activity incentivizedEnergy reduction target

CommentSome facilities managers within IAG are offered financial reward for successful delivery of energy reduction targets. For exampleBritish Airways facilities management contractor in the UK is given an annual energy savings target as part of the contractualagreement.

C2. Risks and opportunities

C2.1

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(C2.1) Describe what your organization considers to be short-, medium- and long-term horizons.

From(years)

To(years)

Comment

Short-term 0 2 For our Enterprise Risk Management process, we assess the potential impact of risks over the next two years versus ourbusiness plan.

Medium-term

2 5 As part of our business planning cycle, risks are considered over the five-year business plan.

Long-term 5 30 Group-wide emerging risks are considered as they are identified. For climate risk assessment we look at a range of timescalesincluding 2030 and 2050.

C2.2

(C2.2) Select the option that best describes how your organization's processes for identifying, assessing, and managingclimate-related issues are integrated into your overall risk management.Integrated into multi-disciplinary company-wide risk identification, assessment, and management processes

C2.2a

(C2.2a) Select the options that best describe your organization's frequency and time horizon for identifying and assessingclimate-related risks.

Frequencyofmonitoring

How far intothe futureare risksconsidered?

Comment

Row1

Six-monthlyor morefrequently

>6 years The IAG Management Committee reviews risks regularly during the year, including the Group risk map semi-annually, in advanceof reviews by the Audit and Compliance Committee. IAG has an Enterprise Risk Management (ERM) policy which has beenapproved by the Board and climate change risks have been embedded in the ERM framework since 2017. In line with ourcommitment to the Task Force on Climate-Related Financial Disclosure, we also undertake climate-related scenario analysis toreview the resilience of our business strategies in the context of climate change. In 2018, we considered the implications of a 2degree and 4 degree scenario on our business in 2030. Twice a year, the IAG Group Head of Sustainability reports to the IAGManagement Committee and Audit and Compliance Committee on climate-related risks. They also regularly report risks to theIAG Chief of Staff.

C2.2b

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(C2.2b) Provide further details on your organization’s process(es) for identifying and assessing climate-related risks.

Twice a year, the IAG Group Head of Sustainability reports to the IAG Management Committee and Audit and Compliance Committeeon climate-related risks. Risks are regularly reported to the IAG Chief of Staff. The Group Sustainability team works withsustainability representatives and managers in each operating company to regularly assess new risks from a range of sourcesincluding from national and international climate policy, the EU ETS, carbon trading & compliance, and future low carbon transitionplans.

At Group level, key risks from the operating companies, together with Group-wide risks, are maintained in a Group risk map. As risksare identified, they are considered and plotted on the risk map based on an impact and probability scale. For each risk, key controlsand mitigating actions are documented including appropriate response plans. The IAG Management Committee reviews these riskssemi-annually, in advance of reviews by the Audit and Compliance Committee. The impacts of potential risks are assessed againstthe group business plan and strategy. IAG reports these in accordance with 2016 UK Corporate Governance Code and the SpanishGood Governance Code for listed companies.

These risk maps are also reviewed by management committees in each operating company/”OpCo”, who consider the accuracy andcompleteness of the map, significant movements in risk and any changes required to the response plans addressing those risks. The IAG Board has overall responsibility for ensuring that IAG has an appropriate risk management framework and internal controlsin place to manage risks. The Board has approved an Enterprise Risk Management (ERM) policy, which is a comprehensive riskmanagement process to ensure a robust assessment of the risks facing the Group. This process is led by the ManagementCommittee and supported by the Head of ERM.

Guidance is provided in our Annual Report on principal risks which could threaten the Group’s business model, future performance,solvency and/or liquidity. In 2018, these risks were reported across four categories and include airports and critical infrastructure,brand reputation, cyber-security, digital disruption, IT systems, political and economic conditions, and tax.

Climate-related risks have been integrated in the IAG Enterprise Risk Management (ERM) process since 2017. These risks areidentified and assessed by the Group Sustainability Team, in conjunction with the ERM team. These risks are assessed over short,medium and long-term time horizons and against a range of criteria:

• Four risk categories (strategic, business and operational, financial, and compliance and regulatory)

• Four risk likelihoods (remote, possible, probably and likely)

• Four risk impacts (manageable, moderate, serious and critical)

• Three risk trends (stable, increasing or decreasing)

We also undertake climate-related scenario analysis in line with our commitment to the Task Force on Climate-Related FinancialDisclosure. The aim of this is to review the resilience of our business strategies in the context of climate change. For example, in2018 we carried out scenario analysis on the implications of a 2 degree and 4 degree scenario on our business in 2030. As part ofthis analysis we identified that a 4 degree scenario would increase our operational costs, the impact of carbon-related regulationwould be much greater. Three key impacts of this scenario analysis were to raise awareness internally, drive engagement withHanger 51 – an internal accelerator programme which supports new innovative companies – and to identify and disclose several newclimate-related challenges in 2018. See section 3.1d for more details.

C2.2c

(C2.2c) Which of the following risk types are considered in your organization's climate-related risk assessments?

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Relevance&inclusion

Please explain

Currentregulation

Relevant,alwaysincluded

Current regulatory risks are relevant to IAG because a breach of compliance with climate-related regulation could have a financial impacton our business. For example, IAG operates flights to European countries which are subject to the EU Emissions Trading Scheme.Inadvertently breaching compliance with the EU ETS, by inaccurate reporting of emissions, could lead to a civil penalty being imposed bythe UK Environment Agency. In 2018, we identified and assessed the potential impact of current climate-regulated regulation on ourbusiness as part of our ERM framework. We disclosed it as a sustainability challenge in our Annual Report under “environment regulationcompliance”. Some of the ways that we manage this challenge are by factoring ETS carbon prices into business plans, continuedinvestment in modern fleet and innovations to ensure continual improvements in operational fuel efficiency, and engaging with carbonmarket advisors to understand and mitigate compliance challenges.

Emergingregulation


Emerging regulatory risks are relevant to IAG because uncoordinated national and regional climate policies could lead to increasedcompliance costs, competitive distortion, and inconsistent monitoring requirements. For example, IAG is part of the global CORSIAcarbon offsetting scheme from 2021-2035, which requires airlines to purchase offsets for emissions above a 2020 baseline, but the EU isconsidering additional regulation during that period which could lead to additional costs and complexity. A second example is thepotential risk of the EU mandating a set proportion of sustainable aviation fuel (SAF) to be used in jet fuel. This action could result in anincrease in SAF production, but would force airlines to purchase SAF at premium prices compared to conventional fuels, leading toadditional costs and potentially creating competitive distortion. In 2018, we identified and assessed the potential impact of emergingclimate-related regulation on our business through the ERM framework, and conversations between IAG Sustainability and the Board.We disclosed it as a sustainability challenge in our Annual Report under “emergence of a global patchwork of uncoordinated national andregional climate policies”, “climate regulation – regional application”, “sustainable aviation fuels – regulation” and “higher carbon priceand strong policy incentives challenge and opportunity”. Some of the ways we manage this challenge are by allocating resources toengage with governments, IATA and ICAO, to advocate for and deliver a single effective global carbon pricing solution for aviation. Wealso lobby to prevent mandates that create competitive distortion, both directly and through industry organizations at EU and UK levels.

Technology Relevant,alwaysincluded

Climate-related technology risks are relevant to IAG because our programmes of aircraft fleet modernization and investments insustainable aviation fuels rely on policy support to enable technological advancements.. We have a plan for biofuels to meet around115,000 tonnes of our fuel supply by 2030 based on existing project commitments, and up to 25% of our fuel supply by 2050. A lack oftechnological development to increase production volumes could affect the cost of these fuels and our exposure to carbon regulation. In2018, we identified and assessed the potential impact of climate-related technology on our business as part of our ERM framework. Wedisclosed this as a sustainability challenge in our Annual Report under “sustainable fuels production opportunity”. A key way that wemanage this challenge is by supporting policy incentives that help deliver SAF at prices competitive with conventional fuels through newtechnologies reaching scale and becoming cost competitive.

Legal Relevant,alwaysincluded

Climate-related legal risks are relevant to IAG because inadvertent breaches of environmental compliance, either directly or via an IAGsupplier or third party, could lead to fines. In 2018, we identified and assessed the potential impact of climate-related legal risks on ourbusiness via our ERM framework, and conversations between IAG Sustainability and the Board. We disclosed this as a sustainabilitychallenge in our Annual Report under “environmental compliance - regulation” and “supply chain CSR compliance”. We manage thischallenge via a range of measures including, as part of our internal guidance, running training and workshops to help staff identify supplychain risks and mitigate them. We also have in place CSR screenings for new suppliers, Know Your Counterparty due diligence for thirdparties deemed higher risk, supplier compliance audits, and IT systems for suppliers and higher risk third parties.

Market Relevant,alwaysincluded

Climate-related market risks are relevant to IAG because the ethical and sustainability concerns of consumers could mean somecustomers fly less frequently or to different destinations. In 2018, we identified and assessed the potential impact of climate-relatedmarket risks on our business via our ERM framework and via conversations between IAG Sustainability and the Board. We disclosed thisas a sustainability challenge in our Annual Report under “consumer behavior challenge and opportunity” and “destinations becomingunattractive for visitors”. We manage this challenge by working towards ambitious goals on carbon efficiency, using all the tools at ourdisposal to minimize our carbon footprint, and improving communication of our practices to customers and suppliers.

Reputation Relevant,alwaysincluded

Climate-related reputational risks are relevant to IAG because investors, banks, passengers, staff, regulators and other stakeholders allwant to see evidence of robust climate action and plans to decarbonise. Inadvertent breaches of environmental compliance could alsolead to fines. In 2018, we identified and assessed the potential impact of climate-related reputational risks on our business via our ERMframework, and conversations between IAG Sustainability and the Board. We disclosed this as a sustainability challenge in our AnnualReport under “supply chain CSR compliance” and “environment regulation compliance”. Some of the ways that we manage thischallenge include internal governance, training and assigning ownership for environmental compliance obligations, management ITsystems for suppliers and higher risk third parties, and actively engaging with industry partners and associations, policy makersshareholders, investors and governments to influence policy and drive action to meet our sustainability objectives.

Acutephysical


Acute physical risks are relevant to IAG because an increased frequency and intensity of weather events such as snow, flooding, stormsand extreme heat events could result in lost demand and revenue and additional costs if customers and employees are unable to travelIn 2018, we assessed the potential impact of climate-related acute physical risks to our business via our ERM framework andconversations between IAG Sustainability and the Board. We have disclosed a principal risk around “events causing significant networkdisruption” of which an example scenario includes adverse weather conditions. Management has business continuity plans to mitigatethis risk to the extent feasible. We also disclosed a sustainability challenge in our Annual Report under “extreme weather impact onoperating costs”. In 2018 we also assessed the potential impacts of acute climate-related physical risks through TCFD-aligned scenarioanalysis. The scope of this analysis was out to 2030 and based on a 2 degree and 4 degree global average temperature rise. We foundthat adverse weather events would cause business interruption and damage to our operations and supply chain with consequences forour costs, revenues, asset values and insurance claims. Some of the ways we manage these challenges are via the IAG climatestrategy, and partnerships to find solutions to mitigate operational disruption. One example of such a project is with NATS and HeathrowAirport to implement innovative technology, the “Time Based Spacing” system, enabling landing rates at Heathrow to be maintained in theevent of strong winds. This additionally has the benefit of mitigating any climate-related weather events.

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Chronicphysical


Chronic physical risks are relevant to IAG because climatic changes such as drought, forest fires, coral bleaching, rising sea levels andreduced snow cover could make destinations unattractive for visitors and reduce customer demand. Sustained extreme heat events orstronger jet streams would increase IAG’s operating cost by increasing delays, fuel burn and additional cooling and maintenance costs.In 2018, we identified and assessed the potential impact of chronic climate-related physical risks via our ERM framework and disclosedthis as a sustainability challenge in our Annual Report under “extreme weather impact on operating costs” and “destinations becomingunattractive to visitors”. We manage this challenge via contingency planning teams who anticipate and prepare for extreme events andbuild in operational recovery plans, and teams dedicated to assessing and understanding changes in customer demand and managingnetwork developments by responding to such changes. We also engage in ongoing lobbying and engagement in projects and initiativesdesigned to reduce the industry’s impact on climate change.

Upstream Relevant,alwaysincluded

Upstream climate-related risks are relevant to IAG because we are dependent on many third parties for goods and services e.g. fuelsuppliers, aircraft and engine manufacturers, airport operators and air traffic controllers (ATC). Potential breaches of compliance couldlead to fines and legal or reputational risks as identified above. Inefficiencies could also affect our overall carbon footprint and soexposure to climate-related regulation. In 2018, we identified and assessed the potential impact of climate-related upstream risks via ourERM process and via conversations between Sustainability and the Board. We disclosed this as a sustainability challenge in our AnnualReport under “supply chain CSR compliance”. Some of the key ways we manage this challenge are by having CSR screening for newsuppliers, Know Your Counterparty due diligence for higher risk parties, Supplier Code of Conduct and supplier compliance audits. Weare interacting with fuel suppliers to reduce the transport-related emissions of our fuel (see section 12), factoring carbon prices into ouraircraft purchasing decisions, engaging with ATCs to identify efficient flight paths, and lobbying to ensure that the ATC issue getsaddressed by ATC operators.

Downstream Relevant,alwaysincluded

Downstream climate-related risks are relevant to IAG because our downstream operations include subcontracted haulage of air freight,subcontracted ground vehicles, and transport of our fuel supply, all of which have a climate impact and affect our exposure to climate-related regulation. In 2018, we identified and assessed the potential impact of climate-related downstream risks via our ERM frameworkand via conversations between IAG Sustainability and the Board. We disclosed this as a sustainability challenge in our Annual Reportunder “supply chain CSR compliance”.

Relevance&inclusion

Please explain

C2.2d

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(C2.2d) Describe your process(es) for managing climate-related risks and opportunities.

Risks are plotted on the Group risk map, which is based on an impact and probability scale. Risk owners are responsible formanaging risk in their area of responsibility. For each risk, key controls and mitigating actions are documented including appropriateresponse plans. Risk maps are reviewed by each operating company’s management committee, who consider the accuracy andcompleteness of the map, significant movements in risk and any changes required to the response plans addressing those risks.

The identified climate-related challenges and opportunities are disclosed in our Annual Report. Risk owners make decisions orrecommendations to respond to climate-related challenges and opportunities. These decisions are communicated to the relevantmanagement team/s at airline level for approval. These are also reported to IAG Management Committee through the annualbusiness planning process.

Two examples of managing specific climate related risks and opportunities are described below:

1. Management of a transition risk – “Global patchwork of climate policy for aviation”

Risk and potential impact on IAG: International climate change regulation for the aviation sector could mean a patchwork ofuncoordinated national and regional policies including inappropriate tax instruments. Although the global market based mechanismCORSIA has been agreed, there is still a risk of regulatory duplication e.g. EU ETS may continue to apply to international aviationduring the early phases of CORSIA after 2021.

This could lead to increased costs, competitive distortion including potential carbon leakage (where inappropriate policy leads toinadvertent increase of carbon emissions across state boundaries) and a failure to address the climate impact of aviation’s emissions.Based on IATA forecasts, a policy patchwork could cost IAG up to six times more than a single market mechanism like CORSIA.

Management case study: Commencing in 2011, and following annual review, IAG controls climate-related risk by allocatingresources to engage with Governments, IATA and ICAO to help deliver a single effective carbon pricing solution for aviation. Regularupdates are provided to the MC and Board.

2. Management of a physical risk – “Operational disruption due to increased extreme weather”

Risk and potential impact for IAG: An increase in extreme weather events such as increased frequency of high winds and lowvisibility of fog events, at British Airways’ home base airport Heathrow, have the potential to increase disruption to our operations,preventing customers and employees from travelling, closing airports and increasing flight diversions.

Management case study: IAG Sustainability appraised various options for mitigating delays and improving our punctuality in theface of weather events. A costed business case was presented to the British Airways management committee demonstrating how wecould collaborate with partners from National Air Traffic Services (NATS) and Heathrow airport to find a solution. The BAmanagement committee decided to progress with a “Time Based Spacing” technology, which enables landing rates at Heathrow to bemaintained in the event of strong winds. This additionally has the benefit of mitigating any climate-related weather effects. Sinceimplementation, this system has reduced delays, reduced fuel burn and emissions and avoided extra costs due to disruptedoperations.

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C2.3

(C2.3) Have you identified any inherent climate-related risks with the potential to have a substantive financial or strategicimpact on your business?No

C2.3b

(C2.3b) Why do you not consider your organization to be exposed to climate-related risks with the potential to have asubstantive financial or strategic impact on your business?

Primaryreason

Please explain

Row1

Risks exist,but nonewithpotential tohave asubstantivefinancial orstrategicimpact onbusiness

IAG has identified and assessed climate-related risks specific to our business via our Enterprise Risk Management (ERM) framework andthrough the application of scenario analysis for climate-related risks. In line with the ERM framework for assessing business risks, we assessedthe scale and likelihood of each climate related impact on the Group’s business model, future performance, solvency and liquidity. Specificclimate-related challenges included emergence of an inappropriate global patchwork of uncoordinated national and regional climate policies, theregional application of climate regulation, sustainable aviation fuels regulation, consumer behavior challenges, higher carbon prices or taxes,operational restrictions and charges, supply chain CSR compliance, extreme weather affecting operating costs, destinations becomingunattractive to visitors, environmental regulation compliance, and being a potential target for direct action protests. In 2018, we published a list ofkey sustainability challenges and opportunities in our Annual Report. All of these have been assessed against our business plan and we haveappropriate response plans in place. IAG Sustainability continues to review climate risks and management responses on an ongoing basis andwith the Management Committee at least annually. The IAG Management Committee and Board have visibility of the assessment. An exampleof a specific potential climate related risk to which our process has been applied is the risk of a global patchwork of climate policy. This couldimpact IAG via increased costs, competitive distortion including potential carbon leakage (where inappropriate policy inadvertently means highercarbon emissions across state boundaries) and a failure to address the climate impact of aviation’s emissions. To manage these potentialimpacts, we incorporate changes into our business plan and lobby for effective responses to aviation’s climate impact. In 2018, IAG is applyingdirect political lobbying in the UK and EU as well as through industry groups IATA, A4E and Sustainable Aviation to help secure CORSIA as therobust market-based mechanism to address aviation’s carbon emissions. This builds on 2017 work, when three IAG representatives participatedin negotiations to develop CORSIA implementation plans and IAG Group Head of Sustainability chaired IATA’s CORSIA working group.

C2.4

(C2.4) Have you identified any climate-related opportunities with the potential to have a substantive financial or strategicimpact on your business?No

C2.4b

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(C2.4b) Why do you not consider your organization to have climate-related opportunities?

Primaryreason

Please explain

Row1

Opportunitiesexist, butnone withpotential tohave asubstantivefinancial orstrategicimpact onbusiness

IAG has identified and assessed climate-related opportunities, including through the application of scenario analysis. We published a list ofclimate-related opportunities in “Sustainability challenges and opportunities” in our Annual Report. These included “consumer behaviourchallenge and opportunity”, “sustainable aviation fuels production opportunity”, higher carbon price and strong policy incentives challenge andopportunity”. Changes in consumer behaviour could offer us an opportunity to differentiate our brand by showing leadership and innovation.Producing sustainable aviation fuel (SAF) could offer us commercial and environmental opportunities to source cost effective fuel and reduceour compliance costs. A higher cost of carbon could create a corresponding opportunity by strengthening the business case for investment inlow carbon technologies. We also included “destinations becoming unattractive to visitors” as an opportunity as well as a challenge, becauseclimate change could make some destinations more attractive or accessible to visitors e.g. a longer summer season. Sustainability and climateopportunities are monitored by IAG Sustainability. They are also reviewed by the ERM Team and reported at least annually to IAGManagement Committee. An example of a key climate-related opportunity to which our assessment process has been applied, is the earlyproduction of sustainable aviation fuels. The lifecycle emissions of these fuels are lower than for fossil fuels, so use of these in our aircraftcould offer IAG a commercial and environmental advantage. They help source cost effective fuel and reduce our CO2 emissions, reducing ourcompliance costs for the EU ETS and/or CORSIA schemes. We have managed this opportunity effectively for many years and achievedsignificant success in 2017. The UK’s Department for Transport has now established policy incentives that will prioritise the production ofsustainable aviation fuel beyond 2020. The UK government has also established a new Special Interest Group to support new research anddevelopment programmes for sustainable aviation fuels. These important policy incentives are vital for IAG to be able to invest in sustainablefuel production in the UK. With the progress and success we have made to date, we believe our current management strategies areappropriate and effective.

C3. Business Strategy

C3.1

(C3.1) Are climate-related issues integrated into your business strategy?Yes

C3.1a

(C3.1a) Does your organization use climate-related scenario analysis to inform your business strategy?Yes, qualitative and quantitative

C-AC3.1b/C-CE3.1b/C-CH3.1b/C-CO3.1b/C-EU3.1b/C-FB3.1b/C-MM3.1b/C-OG3.1b/C-PF3.1b/C-ST3.1b/C-TO3.1b/C-TS3.1b

(C-AC3.1b/C-CE3.1b/C-CH3.1b/C-CO3.1b/C-EU3.1b/C-FB3.1b/C-MM3.1b/C-OG3.1b/C-PF3.1b/C-ST3.1b/C-TO3.1b/C-TS3.1b)Indicate whether your organization has developed a low-carbon transition plan to support the long-term business strategy.Yes

C3.1c

(C3.1c) Explain how climate-related issues are integrated into your business objectives and strategy.

IAG takes a strategic approach to tackling climate-related issues and has set the vision to become the world’s leading airline group onsustainability. We established a Group sustainability function in 2015, and in 2017 carried out a materiality assessment whichhighlighted climate change as our top environmental priority. We set annual climate-related targets at a group level, have an annualreview of climate-related risks, set a 2020 fuel efficiency target in 2014 and are working towards climate goals to 2050.

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Our key targets are:

• Improve our fuel efficiency from 97.5 grammes CO2 per passenger-km in 2014, to 87.3g CO2/pkm in 2020.

• Deliver an annual fuel efficiency improvement of at least 1.5%. This is an industry-level target agreed in 2009.

• Achieve carbon neutral growth for international aviation from 2020. This is an industry-level target agreed in 2009.

• Reduce net CO2 emissions by 50% by 2050 versus a 2005 baseline. This is an industry-level target agreed in 2009 and consistentwith the ambition to limit climate change to less than 2 degrees temperature increase above pre-industrial levels.

To deliver on these targets and wider objectives, IAG has a Group Sustainability programme which is co-ordinated centrally. Eachoperating airline – British Airways, Iberia, Aer Lingus, Vueling and Level – maintains individual environmental programmes under thecontrol of their respective Boards. Established Group-wide working groups on fuel and carbon efficiency and environmentalmanagement also share expertise and best practice, and meet quarterly to review performance in relation to climate change, carbonefficiency and fuel efficiency among other sustainability measures. These working groups are co-ordinated by the IAG Group Head ofSustainability and key outputs are reported to the Management Committee and the IAG Board. Our ERM process gives us a robustframework to assess and act on climate-related risks and this process feeds back in to the business strategy, risk managementfunction, finance and sustainability governance structures to inform future decisions.

As well as driving climate change action internally, IAG has a strategic priority to enhance our global leadership position, by settingthe industry standard for environmental stewardship. In practice this means:

• Taking a leadership position advocating carbon pricing for aviation. IAG and British Airways were instrumental in designing andsecuring support for the global aviation offsetting scheme CORSIA, which commences in 2019.

• Supporting the implementation of CORSIA and mentoring other airlines to ensure CORSIA is adopted successfully. We continue toactively support the delivery of CORSIA through our collaboration with the airline association IATA and UN body ICAO.

• Providing leadership on sustainable aviation fuels (SAF). We spent almost a decade lobbying for SAF inclusion in renewable fuelpolicies at the Global, EU, and UK levels and continue to invest in a partnership with Velocys that can help us scale up our biofuelvolumes, in the UK, via advanced technology waste-to-fuel production projects.

• Maintaining leadership in carbon disclosures. The CDP awarded IAG an A score in 2017, making us the only airline on the A-list thatyear, and we also received the award for the “most improved” disclosures that year for a UK company.

We have already seen a decoupling of our growth from our environmental impact. Between 2012-18, IAG’s available seat kilometres(ASKs) increased by 48% while our Scope 1 CO2e emissions increased by 30% and our carbon intensity, measured in grammes ofCO2 per passenger-kilometre, reduced by 9%. We estimate that we have saved almost 10 million tonnes of CO2 during this periodas a result of higher fuel efficiency.

In line with our targets, strategy and vision, in 2018 we continued to make decisions to reduce our climate impact. Key achievementsincluded:

• Improving our flight carbon efficiency by 0.9% to 91.5g CO2/pkm, giving us a rolling average over five years of 1.5% per year andmoving us closer to our 2020 target of 87.3g CO2/pkm.

• Delivering on our sustainable aviation fuels projects, with a view to these fuels reaching 115,000 tonnes of our fuel supply by 2030based on current commitments and up to 25% of our fuel supply by 2050. We are investing over 400 million dollars in sustainableaviation fuels over the next 20 years.

• Launching new monitoring software to support fuel-saving initiatives, with the Honeywell GoDirect Fuel Efficiency software goinglive in British Airways, Aer Lingus and Iberia in November 2018. This software represents an investment of over 1 million euros overfive years.

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• Continuing our programme of fleet modernisation by introducing three new types of fuel-efficient aircraft to the IAG fleet, 42 newmore fuel efficient aircraft, and selling, leasing back or retiring 21 less efficient aircraft.

• Running a “Future of Fuels” competition in conjunction with UK universities in order to support innovation in sustainable aviationfuels projects

• Actively working with industry associations to support effective regulatory and policy approaches to aviation-related climate issues.

• Electrifying our vehicles on the ground. Our investments at BA, Iberia and Aer Lingus included electric baggage trackers and 30 newelectric Mototoks to replace fossil-fuel burning ground vehicles that push back aircraft from airport parking stands.

• Increasing the use of renewable electricity for our buildings and making a commitment to further action in 2019. 50% of our Groupelectricity use in 2018 was from renewable electricity, up from 48% in 2017 and 11% in 2016.

We also strengthened our assessment of how climate-related issues will affect our business. In addition to the ERM processmentioned in Section 2, key activities in 2018 included:

• Adopting the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) for disclosures and carrying outscenario analysis.

• Scenario analysis of how our business would be affected in 2030 as a result of a 2 degree and 4 degree warmer world. The cross-functional climate scenario analysis workshop included input from internal strategy, risk, finance, treasury, digital and operationalexperts to review opportunities and risks. The analysis included an initial qualitative assessment of potential IAG response in terms ofchanges to our business model, portfolio mix, investments in transition capabilities and technologies and the potential impact onstrategic and financial plans.

• Continuing to incorporate carbon prices into purchasing decisions and fuel sensitivity analysis for new aircraft.

• Incorporating the future costs of the CORSIA carbon pricing scheme and EU Emissions Trading Scheme into our five-year businessplanning process.

We continue to review and build on these efforts in 2019.

C3.1d

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(C3.1d) Provide details of your organization’s use of climate-related scenario analysis.

Climate-relatedscenarios

Details

RCP 2.6 In 2018 we followed the TCFD six step scenario analysis process to consider two contrasting scenarios on our business: • A 2⁰C scenario, consistentwith meeting the Paris Agreement Goal (Representative Concentration Pathway ‘RCP 2.6’) • A 4⁰C scenario as an alternative high emission scenario(RCP 8.5) We judged these IPCC reference scenarios to offer well described and plausible climate scenarios that provide two contrasting casesagainst which to test impacts for IAG. We considered the implications of these two climate scenarios on our business in 2030, assuming we have thesame business activities as we do today. 2030 was selected as a nearer term consideration en-route to 2050, which is the target year for our 50% netCO2 reduction target. Internal stakeholders participating in the workshop were IAG Strategy, Treasury, Enterprise Risk Management, InvestorRelations, Digital Innovation, Procurement and Sustainability and our operating company sustainability and fuel efficiency managers. The analysisincluded an initial qualitative assessment of potential IAG response in terms of changes to our business model, portfolio mix, investments in transitioncapabilities and technologies and the potential impact on strategic and financial plans. Areas of our organisation we considered as part of our climate-related scenario analysis include finance, strategy, operations, procurement, innovation and risk. We also assessed the effects on input costs,operating costs, revenues, supply chain, and business interruption. Broadly, the 2 degrees scenario demonstrated that IAG would incur additionaloperating costs, mainly as a result of the increased cost of carbon or other policy interventions. One key outcome of this process was to invite externalcompanies with ideas to support operational resilience (including to more extreme weather events), to apply to our innovations programme ‘Hangar 51’.Hanger 51 is an IAG accelerator programme that provides 10 weeks of support to innovative companies with products that could improve our business.In 2018 two companies with climate-related products were accepted for and successfully completed this programme. One company used weather datato inform flight planning and the other used behavioural interfaces to incentivise pilots to make fuel efficiency savings. IAG is still in contact with thesecompanies and their inclusion was one factor that led to a dedicated sustainability category for Hanger 51 in 2019. Other key outcomes of this processwere: • Raising awareness of climate-related impacts by engaging multiple teams. • By agreeing to continue to work collaboratively on this iterativeprocess, integrating scenario analysis into existing strategic business planning processes. • Identifying and disclosing several new climate-relatedchallenges in 2018.

RCP 8.5 IAG followed TCFD recommendations to use: • A 2⁰C scenario, consistent with meeting the Paris Agreement Goal (e.g. RCP2.6) • An alternative highemission scenario (e.g. RCP8.5, a 4 degree scenario) to understand our stressed exposure to plausible physical climate change. We judged theseIPCC references to offer well described and plausible climate scenarios that provide two contrasting scenarios against which to test impacts for IAG.IAG qualitatively assessed implications of these two climate scenarios on our business in 2030 assuming we have the same business activities as wedo today. 2030 was selected as a more tangible nearer term consideration on route to 2050 which is the target year for our 50% CO2 reduction target.In the 4⁰C (RCP8.5) scenario we assumed: • From 2018 to 2030 climate policy is less ambitious, aligned to business as usual. • However, emissionsare high so the physical manifestations of climate change are increasingly apparent by 2030. • Carbon price just a little more than today of $20 pertonne in 2030. The 4 degrees scenario demonstrated that, compared to a 2 degree scenario, IAG would incur additional operating costs which weremore likely to arise from an increased cost of operational disruption e.g. due to increased frequency of extreme weather events. A key outcome of thisprocess was to invite external companies with ideas to support operational resilience (including to more extreme weather events), to apply to ourinnovations programme ‘Hangar 51’. Hanger 51 is an IAG accelerator programme that provides 10 weeks of support to innovative companies withproducts that could improve our business. In 2018 two companies with climate-related products were accepted for and successfully completed thisprogramme. One company used weather data to inform flight planning and the other used behavioural interfaces to incentivise pilots to make fuelefficiency savings. IAG is still in contact with these companies and their inclusion was one factor that led to a dedicated sustainability category forHanger 51 in 2019. Other key outcomes of this process were: • Raising awareness of climate-related impacts by engaging multiple teams. • By agreeingto continue to work collaboratively on this iterative process, integrating scenario analysis into existing strategic business planning processes. • Weidentified and disclosed several new climate-related challenges in 2018.

C-AC3.1e/C-CE3.1e/C-CH3.1e/C-CO3.1e/C-EU3.1e/C-FB3.1e/C-MM3.1e/C-OG3.1e/C-PF3.1e/C-ST3.1e/C-TO3.1e/C-TS3.1e

(C-AC3.1e/C-CE3.1e/C-CH3.1e/C-CO3.1e/C-EU3.1e/C-FB3.1e/C-MM3.1e/C-OG3.1e/C-PF3.1e/C-ST3.1e/C-TO3.1e/C-TS3.1e)Disclose details of your organization’s low-carbon transition plan.

Climate change is IAG’s most material sustainability issue. With global demand for air travel expected to at least double by 2050, weare using all the tools at our disposal to decouple aviation growth from a growth in greenhouse gas emissions and to minimise ourcarbon footprint.

IAG wants to secure long-term success by readying our industry for the move towards a low carbon economy. We were instrumentalin developing the aviation industry’s joint declaration on climate change which was signed in Geneva in 2009 by our CEO and othersfrom across the aviation industry at the Global Sustainable Aviation Summit. The industry declaration, which we have adopted as IAGpolicy, follows a three-goal, four-pillar strategy to set aviation on the transition pathway to a low carbon economy.

These three goals are to deliver:

1. Annual fuel efficiency improvement of at least 1.5%

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2. Achieve carbon neutral growth for international aviation from 2020

3. Reduce net aviation CO2 emissions by 50% by 2050 versus 2005 baseline (although our goal predates the Paris Agreement it isconsistent with the ambition to limit climate change to less than 2 degrees temperature increase above pre-industrial levels)

The four 'pillars' are the mechanism to deliver these targets:

1. Technology

2. Operations

3. Infrastructure and

4. Market based measure to enable carbon pricing and reduction

In delivering this transition plan, IAG is driving action across all four areas, for example, we are:

• Investing in modern aircraft with typically 10-20% lower carbon emissions than the aircraft they replace. This includes the AirbusA320neo and the new A350 for example.

• Leading innovation for sustainable aviation fuels, deriving jet fuel from waste, with at least a 70% reduction in CO2 compared tofossil-jet fuel by investing in two partnerships to build Europe’s first waste-to-fuel plants in the UK. • Applying the latest fuel efficiencymeasures and using our strength as a Group to benchmark and ensure we apply best operational practice across our airline fleets. InIAG we have delivered a rolling average of 1.5% annual efficiency since 2012.

• Engaging with partners including air traffic control, airport operators and aircraft manufacturers to deliver better flight profiles andprocedures to enable more efficient flying.

• Influencing national and global policy to promote global carbon pricing for aviation and actively participating in IATA and ICAOefforts to develop CORSIA, the market based mechanism that will enable delivery of the target of carbon neutral growth from 2020and net reduction of 50% CO2 by 2050. We completed our first CORSIA Emissions Monitoring Plans in September 2018 and havestarted monitoring our emissions for CORSIA from 1st January 2019.

IAG is also supporting low-carbon transition plans in the wider aviation industry. We are a founding partner in the UK SustainableAviation (SA) coalition group – which brings together airlines, manufacturers, air traffic controllers and airport operators – to drivecleaner, quieter and smarter solutions for aviation . Key IAG sustainability staff have had roles as the Chair of SA and current chair ofthe SA Climate group and we have actively contributed to the development of a UK Sustainable Aviation Carbon Roadmap to 2050.We are now working on further inputs to this plan using the latest information.

The important ground work that has already been achieved with the establishment of CORSIA and our innovation in sustainable fuelsmeans we already have in place the fundamental tools needed to deliver our low carbon transition plan. We are continuing to focuson realising the goals and influencing the external factors such as global and domestic policy on carbon pricing and sustainable fuelsto ensure our transition plan is delivered.

C4. Targets and performance

C4.1

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(C4.1) Did you have an emissions target that was active in the reporting year?Intensity target

C4.1b

(C4.1b) Provide details of your emissions intensity target(s) and progress made against those target(s).

Target reference numberInt 1

ScopeScope 1

% emissions in Scope76.8

Targeted % reduction from base year10

MetricGrams CO2e per revenue passenger kilometer*

Base year2014

Start year2014

Normalized base year emissions covered by target (metric tons CO2e)25219827

Target year2020

Is this a science-based target?No, but we are reporting another target that is science-based

% of target achieved59

Target statusUnderway

Please explainThe target is to reduce the intensity of our flight operations by 10% by 2020 (87.3 gCO2/pkm) compared to 2014 (97.5 gCO2/pkm).This represents an equivalent CO2 reduction of 4.9 million tonnes CO2e by 2018 (compared to 2014 levels of efficiency). In 2018,we brought 42 more efficient aircraft into the fleet, which along with fuel efficiency initiatives represented an 0.9% improvement onthe previous year. In 2018 we saved around 2 million tonnes of CO2e compared to 2014 levels of efficiency. We are now 4 yearsinto our 6 year programme, with 59% of the target achieved and our 2018 fuel efficiency at 91.5 gCO2/pkm.

% change anticipated in absolute Scope 1+2 emissions8.5

% change anticipated in absolute Scope 3 emissions0

Target reference numberInt 2

ScopeScope 1

% emissions in Scope82

Targeted % reduction from base year1.5

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MetricGrams CO2e per revenue passenger kilometer*

Base year2017

Start year2017

Normalized base year emissions covered by target (metric tons CO2e)28698902

Target year2018

Is this a science-based target?No, but we are reporting another target that is science-based

% of target achieved58

Target statusExpired

Please explainOur target is to achieve 1.5% improvement in fuel efficiency per year. This is delivered through a basket of measures includinginvestment in aircraft modernisation and operational efficiency. The 1.5% target is an aviation industry agreed target supported bythe international airline association IATA and agreed by UN civil aviation body ICAO in 2009.British Airways was instrumental indeveloping and gaining industry support to adopt it. In 2018, we achieved an 0.9% increase in year-on-year fuel efficiency, so didnot meet the target that year. This was due to the rate of fleet renewal, changes in the weight of cargo carried, as well aschallenging operating conditions including disruption caused by European ATC strikes. However, IAG has delivered a 1.5% rollingaverage improvement in fuel efficiency since 2012. This has provided cumulative savings of 4.9 million tonnes of CO2e in the 6years to 2018, based on our predicted 2018 emissions if we had maintained 2012 levels of efficiency. We brought 42 new moreefficient aircraft into the fleet in 2018, which when combined with fleet retirements and operational efficiency measures delivered asaving of around 260,000 tonnes of CO2e compared to 2017 levels of efficiency.

% change anticipated in absolute Scope 1+2 emissions1.5

% change anticipated in absolute Scope 3 emissions0

C4.2

(C4.2) Provide details of other key climate-related targets not already reported in question C4.1/a/b.

TargetOther, please specify (net emissions reduction (Abs 1))

KPI – Metric numeratorScope 1 + Scope 2 (location based) tonnes CO2e combined.

KPI – Metric denominator (intensity targets only)Not relevant - not an intensity target

Base year2005

Start year2009

Target year2050

KPI in baseline year23237182

CDP Page of 7419

KPI in target year11618591

% achieved in reporting year0

Target StatusUnderway

Please explainIAG has a target to achieve a 50% net reduction in emissions by 2050 versus a 2005 baseline. We consider this to be an absolutereduction target but due to CDP guidance on offsetting we are reporting this here. This is also an aviation industry-wide target whichBritish Airways was instrumental in developing and securing industry support for in 2009. The reduction required is based onaviation emissions in 2005 and the scientific requirement as stated by the IPCC that global CO2 emissions would need to reduceby 50% by 2050 to remain within the desired maximum of no more than 2 degrees increase in global average temperature by 2050.Base year emissions are available for BA and Iberia. For Aer Lingus, who were acquired by IAG in 2015, Vueling who wereacquired by IAG in 2013, and Level, which did not exist in 2005, we will include their emissions within the scope of our target. IAGplans to achieve direct emission reductions via investment in: • more efficient aircraft technology • more efficient operations •adoption of sustainable aviation fuel, which have lower lifecycle CO2 emissions Together these measures will see us achieveemissions broadly level with 2005 levels by 2050. To achieve a 50% net reduction on 2005 levels, for aviation the only option is toemploy a market based measure to allow the industry to reduce carbon emissions more cost effectively in other sectors. As part ofthis, IAG has a target to achieve carbon neutral growth (CNG) from 2020, meaning that any emissions from international flightsabove the 2020 emissions baseline will be offset. This is also an aviation industry agreed target supported by IATA, which BritishAirways was instrumental in developing. The target of CNG 2020 was ratified by the industry in 2009 and remains the focus ofmedium term action to address climate change emissions. The mechanism to achieve CNG 2020 will be the global CORSIAscheme. From 2021, airlines will be required to buy emissions units to offset their share of the sector’s growth in emissions. Theseemissions units will fund sustainable carbon reduction projects around the world. Successfully implementing CORSIA will allow usto develop further plans to deliver on our longer-term target of a 50 per cent reduction in CO2 emissions by 2050.

Part of emissions targetn/a

Is this target part of an overarching initiative?Other, please specify (IATA Industry Targets)

TargetOther, please specify (Net emissions reduction (abs 2))

KPI – Metric numeratorScope 1 emissions tCO2e

KPI – Metric denominator (intensity targets only)Not relevant - not an intensity target

Base year2019

Start year2019

Target year2050

KPI in baseline year32000000

KPI in target year32000000

% achieved in reporting year0

Target StatusUnderway

Please explainIAG has a target to achieve carbon neutral growth (CNG) from 2020, meaning that any emissions from international flights abovethe 2020 emissions baseline will be offset. This is also an aviation industry agreed target supported by airline industry association

CDP Page of 7420

IATA, which British Airways was instrumental in developing. The target of CNG 2020 was ratified by the industry in 2009 andremains the focus of medium term action to address climate change emissions. While an end-date was not specified, we have listed2050 here for consistency with CDP’s answer requirements. The mechanism to achieve CNG from 2020 will be the global CORSIAscheme. In 2016 the UN civil aviation regulator ICAO achieved agreement from 191 countries to develop CORSIA, the world’s firstglobal market based measure to address aviation’s carbon emissions. Baseline monitoring for CORSIA began on 1st January 2019and the target takes effect from 2020. From 2021, airlines in CORSIA-participating countries, which collectively represent around80% of international aviation emissions, will be required to buy emissions units to offset their share of the sector’s growth inemissions. These emissions units will fund sustainable carbon reduction projects around the world. Successfully implementingCORSIA will allow us to develop further plans to deliver on our longer-term target of a 50 per cent reduction in CO2 emissions by2050 (i.e. Abs1 above). Due to different regulations, aviation's international and domestic aviation emissions are regulatedseparately - international aviation is regulated by the UN agency ICAO and domestic emissions are managed by states. The latterhappens through Nationally Determined Contributions (NDCs) which contribute to the Paris Climate agreements, as well as throughthe EU where aviation emissions are managed through the EU Emissions Trading System. 32 million tonnes of CO2 is the currentforecast for IAG absolute emissions in 2020. This number could change due to changes in our fleet plan or routes, and will berevised closer to the time, but is a reasonable estimate. Our target to achieve carbon neutral growth from 2020 means that our netemissions in each year after 2020 will be at or lower than 2020 levels.

Part of emissions target

Is this target part of an overarching initiative?Other, please specify (IATA Industry Targets)

C4.3

(C4.3) Did you have emissions reduction initiatives that were active within the reporting year? Note that this can includethose in the planning and/or implementation phases.Yes

C4.3a

(C4.3a) Identify the total number of initiatives at each stage of development, and for those in the implementation stages, theestimated CO2e savings.

Number of initiatives Total estimated annual CO2e savings in metric tonnes CO2e (only for rows marked *)

Under investigation 4 2134

To be implemented* 0 0

Implementation commenced* 0 0

Implemented* 13 30708

Not to be implemented 1 4468

C4.3b

(C4.3b) Provide details on the initiatives implemented in the reporting year in the table below.

Initiative typeEnergy efficiency: Processes

Description of initiativeProcess optimization

Estimated annual CO2e savings (metric tonnes CO2e)5300

ScopeScope 1

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Voluntary/MandatoryVoluntary

Annual monetary savings (unit currency – as specified in C0.4)963490

Investment required (unit currency – as specified in C0.4)0

Payback periodNo payback

Estimated lifetime of the initiativeOngoing

CommentAn alternative airway found north of the restricted airspace in Iraq - saving approximately 20 minutes flying time on certain routes.




ScopeScope 1






CommentNo longer avoiding airspace from Fukushima Nuclear incident meaning more efficient flight paths.




ScopeScope 1




Payback period

CDP Page of 7422

No payback


CommentA truncation of the Standard Instrument Departure (SID) procedure at Heathrow airport, reducing the distance travelled and fuelplanning requirement for lower elevations.




ScopeScope 1






CommentA truncation of the Standard Instrument Departure procedure at Gatwick airport, reducing the distance travelled and fuel planningrequirement for lower elevations.


Description of initiativePlease select


ScopeScope 1






CommentReduced track miles on arrival at Heathrow airport.

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ScopeScope 1






CommentReduced track miles on arrival in Gatwick airport.




ScopeScope 1






CommentMore accurate matching of fuel volumes to the fuel needs of flights which reduced the weight of fuel carried.




Scope

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Scope 1






CommentOptimising the water load per fleet and route which reduced the weight of water carried.




ScopeScope 1






CommentCollated flight efficiency initiatives in Vueling.




ScopeScope 1




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CommentReduction in drag by reducing the time when landing lights are extended into the airflow.




ScopeScope 1






CommentReduction in fuel rounding. Fuellers had a habit of rounding fuel load up to 100 litres. Behaviour was measured and reported backand instances reduced significantly.




ScopeScope 1






CommentReduction in extra fuel planning – ending the practice of flight planners adding fuel to flight plans. Monetary savings listed aboveare based on reductions in fuel purchases.

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ScopeScope 1






CommentLiaising with Air Navigation Service Providers (ANSPs) to secure earlier altitude release on departure procedures from airports, sothat lower fuel loads may be planned. Monetary savings listed above are based on reductions in fuel purchases.

C4.3c

(C4.3c) What methods do you use to drive investment in emissions reduction activities?

Method Comment

Internal price oncarbon

Carbon prices are embedded in the annual business planning process and used for forecasting business investment over a five-year cycle.In 2018, an EU ETS carbon price of 20 Euros/tonne was used. Business cases are required to identify appropriate carbon costings (e.g.the EU ETS cost of allowances) for projects that affect energy consumption, fuel efficiency or aircraft weight or aircraft purchasing.Operational decisions, such as the need to carry potable water or to tanker fuel when fuel supply is uncertain at destination airports, aremade with a price of carbon included in the business case.

Internalincentives/recognitionprograms

Fuel efficiency, energy, and environmental managers are rewarded for achieving fuel/energy efficiency KPIs or climate change policyKPIs.

Employee engagement The Fuel Efficiency teams engage with local station managers and provide instructions on fuel efficiency procedures. For example, BritishAirways Fuel Efficiency Working Group provides station managers with instructions on the procedure for using the Auxiliary Power Unit(APU). Stations receive monthly reports on APU performance. In addition, pilots attend professional standards assessments. Theseassessments include a component of commercial awareness, highlighting the importance and potential impact of fuel saving activities. InVueling annual training sessions are held to brief all pilots on fuel efficiency opportunities and priority initiatives. In Aer Lingus employeesincluding pilots are engaged using the fuel management system to demonstrate data that underpins the need for best operationalpractices.

Dedicated budget forenergy efficiency

At British Airways there is a central finance mechanism to drive investment across departments for aircraft fuel efficiency projects.

Compliance withregulatoryrequirements/standards

Emissions trading costs allocation and accounting across departments within IAG carriers.

Compliance withregulatoryrequirements/standards

EU-ETS compliance has incentives attached for departments in Vueling.

C4.5

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(C4.5) Do you classify any of your existing goods and/or services as low-carbon products or do they enable a third party toavoid GHG emissions?Yes

C4.5a

(C4.5a) Provide details of your products and/or services that you classify as low-carbon products or that enable a third partyto avoid GHG emissions.

Level of aggregationProduct

Description of product/Group of productsBritish Airways has a “Carbon Fund” which uses customer donations from flight bookings on ba.com to invest in renewable energyand energy efficiency projects. These projects provide community benefits and mitigate climate change. The Carbon Fund issued17 grants in 2018, bringing the total number of completed projects to 38; with another 5 presently being delivered (with 10 more inthe pipeline for 2019). The scheme has now provided more than £3,000,000 of lifetime community benefits and completed projectshave also impacted the lives of 450,000 people across the UK and in Africa. We post details of the scheme and projects onwww.ba.com/carbonfund

Are these low-carbon product(s) or do they enable avoided emissions?Avoided emissions

Taxonomy, project or methodology used to classify product(s) as low-carbon or to calculate avoided emissionsOther, please specify (Avoided emissions)

% revenue from low carbon product(s) in the reporting year0

CommentThe money raised through the Carbon Fund goes to external projects. Further work is being done to revise the Carbon Fund pageson BA.com to encourage wider customer uptake .

C5. Emissions methodology

C5.1

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(C5.1) Provide your base year and base year emissions (Scopes 1 and 2).

Scope 1

Base year startJanuary 1 2011

Base year endDecember 31 2011

Base year emissions (metric tons CO2e)22578170

Comment

Scope 2 (location-based)




Comment

Scope 2 (market-based)




Comment

C5.2

(C5.2) Select the name of the standard, protocol, or methodology you have used to collect activity data and calculate Scope1 and Scope 2 emissions.The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (Revised Edition)

C6. Emissions data

C6.1

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(C6.1) What were your organization’s gross global Scope 1 emissions in metric tons CO2e?

Reporting year

Gross global Scope 1 emissions (metric tons CO2e)30138236

Start dateJanuary 1 2018

End dateDecember 31 2018

CommentDirect emissions associated with our flying, vehicles and generators. • Scope 1 CO2e emissions have increased versus last yearby 4.8% but at a lower rate than airline activity (+6.1% available seat kilometres and +7.7% passenger numbers). • In line withindustry commitments which we were instrumental in securing in 2009, we have two targets designed to address our direct CO2emissions over different timescales. These are to achieve carbon neutral growth for our international aviation from 2020 and a 50%net reduction in CO2 emissions by 2050 versus a 2005 baseline (which is 23.25 million tonnes).

C6.2

(C6.2) Describe your organization’s approach to reporting Scope 2 emissions.

Row 1

Scope 2, location-basedWe are reporting a Scope 2, location-based figure

Scope 2, market-basedWe are reporting a Scope 2, market-based figure

CommentWe monitor energy consumption throughout the year at physical locations in the UK, Ireland and Spain. Relevant buildings includeoffices, cargo buildings, hangers, data centres and airport terminal lounges. British Airways also leases office space in more thantwo hundred properties in over 60 countries, and Iberia leases space in over 20 countries, so for these separate locations electricityuse is estimated using a benchmark kWh/square meter figure for different building types. We apply Spanish Governmentconversion factors for relevant electricity use in Spain and have improved the robustness of our methodology since 2017. In 2018,50% of Group electricity use was from renewable sources, up from 48% in 2017 (both numbers are revised estimates) and 11% in2016. The breakdown across the group is as follows: British Airways 75% (up from 65%), Aer Lingus 52% (up from 49%), andIberia and Vueling 0% due to relying on grid electricity. Emission trends can fluctuate year-on-year due to changes in the use ofdifferent locations and changes in contracts. IAG is committed to further action, with Iberia and Vueling moving to 100% procuredrenewable electricity in 2019 and Aer Lingus moving to 100% renewable electricity for key buildings in Dublin and Cork

C6.3

CDP Page of 7430

(C6.3) What were your organization’s gross global Scope 2 emissions in metric tons CO2e?

Reporting year

Scope 2, location-based82271

Scope 2, market-based (if applicable)46812

Start dateJanuary 1 2018

End dateDecember 31 2018

CommentOur Scope 2 emissions have reduced again in 2018. The location-based emissions are down by 11% versus last year and ourmarket based emissions have reduced by 24% in the same period. The location-based Scope 2 emissions reported here reflect thenational grid mix for the UK, Spain and Ireland. We have been reporting Scope 2, location-based emissions since 2011 while 2016was our first year for reporting Scope 2, market based emissions. Some key points: • Year-on-year trends can fluctuate and areinfluenced by airline acquisitions, contracts with energy suppliers, and national trends towards less carbon intensive electricityacross Spain, the UK and Ireland. • 50% of Group electricity use in 2018 was from renewable sources, up from 48% in 2017 and11% in 2016. • Renewable electricity use across the Group in 2018: British Airways 75%, Aer Lingus 52% and Iberia and Vueling0% each. Iberia and Vueling didn’t contract any renewable electricity from renewable electricity suppliers in 2018 but are moving toprocuring 100% renewable electricity in 2019.

C6.4

(C6.4) Are there any sources (e.g. facilities, specific GHGs, activities, geographies, etc.) of Scope 1 and Scope 2 emissionsthat are within your selected reporting boundary which are not included in your disclosure?Yes

C6.4a

(C6.4a) Provide details of the sources of Scope 1 and Scope 2 emissions that are within your selected reporting boundarywhich are not included in your disclosure.

SourceScope 2 emissions from Level, a new low-cost airline in the IAG Group with bases in France, Austria and Barcelona.

Relevance of Scope 1 emissions from this sourceNo emissions excluded

Relevance of location-based Scope 2 emissions from this sourceEmissions are not relevant

Relevance of market-based Scope 2 emissions from this source (if applicable)Emissions are not relevant

Explain why this source is excludedLevel is the newest airline in the IAG Group and is less than two years old. While we are making efforts to capture Level’s Scope 2emissions, there is limited data available, and these emissions are calculated to be less than 1% of the Group’s emissions at thistime so are determined as not relevant. As Level grows and data availability improves in future, we will aim to include more detailedestimates

SourceIberia and Vueling - GHG emissions from natural gas and electricity use at non-Spanish facilities (e.g. from a small office leased ata destination airport).

Relevance of Scope 1 emissions from this sourceEmissions are not relevant

CDP Page of 7431



Explain why this source is excludedGHG emissions from natural gas and electricity use at non-Spanish facilities (e.g. from a small office leased at a destination airport)are very small (significantly less than 1 % of Scope 1 and 2 emissions) and anticipated at less than 5% of Scope 2 emissions sodetermined as not relevant. As data availability improves over time, we will endeavour to include an estimate for these emissions inupcoming years.

SourceUnintentional leakage of fluorinated gases used for refrigeration, fire suppression, and as engineering solvents (i.e. gases notintentionally emitted) - specifically HFCs, Methylene Chloride, and Halons (though Halon emission from deployment of fireextinguishers is included).


Relevance of location-based Scope 2 emissions from this sourceNo emissions from this source

Relevance of market-based Scope 2 emissions from this source (if applicable)No emissions from this source

Explain why this source is excludedIAG operator British Airways reported these emissions for 2012. From 2013 onward, we have flagged that this emissions data isnot material (less than 10 tonnes C02e in total), that gathering the data related to unit servicing and leakage is very timeconsuming, and that the calculation was a best guess (but not very precise). It was decided to exclude these potential emissionsand we instead focus on capturing the actual emissions of halons from deployment of fire suppression devices, which is included in2016, 2017 and 2018 reporting.

SourceAn element of Aer Lingus energy and water consumption/emissions data at destination airports.




Explain why this source is excludedThe Aer Lingus energy and water consumption/emissions data is for Dublin and Shannon buildings only. Data is not available forCork. Aer Lingus do not manage the destination airports, there is no direct metering of the leased space, and energy costs areincluded in miscellaneous charges, making values difficult to estimate. Key data from destination airports which has not beenprovided is from the main stations at London Heathrow (two offices, a lounge, and a line maintenance facility of 340 m2, New York(offices at Jericho, lounges) and Belfast. These locations are estimated to be less than 5% of Scope 2 emissions so determined asnot relevant. However, as data availability improves over time, we will endeavour to include an estimate for these emissions inupcoming years.

C6.5

(C6.5) Account for your organization’s Scope 3 emissions, disclosing and explaining any exclusions.

CDP Page of 7432

Purchased goods and services

Evaluation statusRelevant, calculated

Metric tonnes CO2e688

Emissions calculation methodologyThe supply and treatment of water emits CO2e. Data from suppliers and from invoices has been used to calculate water usage.Conversion factors were applied to calculate CO2e according to guidance from the UK government. Level’s Scope 3 emissions hasbeen excluded due to being relatively small (less than 1% of the IAG footprint), a lack of data and for a consistent approach.

Percentage of emissions calculated using data obtained from suppliers or value chain partners94.7

ExplanationIAG uses water in buildings such as offices, lounges, hangers and engineering centres and potable water on flights. The abovefigures relate to water supply and water treatment.

Capital goods



Emissions calculation methodologyAircraft manufacture and disposal comprises 18% of our scope 3 emissions. Values for OpCos have been calculated based on thedocument “EU Transport GHG: Routes to 2050”, which specified the relative share of emissions from aircraft production anddisposal compared to their fuel burn in flight. Level’s Scope 3 emissions has been excluded due to being relatively small (less than1% of the IAG footprint), a lack of data and for a consistent approach.

Percentage of emissions calculated using data obtained from suppliers or value chain partners100

ExplanationThe processes of making aircraft, and disposing of aircraft at the end of their life, can produce emissions. Aircraft manufacture anddisposal comprises 18% of our scope 3 emissions.

Fuel-and-energy-related activities (not included in Scope 1 or 2)



Emissions calculation methodologyThis aspect includes Fossil fuel production and Fuel production for energy generation. The first of these, Fossil fuel production,accounts for 71% of our total Scope 3 CO2 emissions. Values for each airline have been calculated based on the volume of energycontent of fuels used, multiplied by relevant well-to-tank (WTT) conversion factors from the UK government. Level’s Scope 3emissions has been excluded due to being relatively small (less than 1% of the IAG footprint), lack of data and for a consistentapproach.


ExplanationThis aspect includes Fossil fuel production and Fuel production for energy generation.

CDP Page of 7433

Upstream transportation and distribution



Emissions calculation methodologyValues for BA and Iberia have been calculated. The calculation includes cargo trucks, fuel trucks from supplier DHL, and aircraftfuel trucks. Values for Aer Lingus and Vueling have been estimated based on a ratio of their jet fuel use compared to BA’s jet fueluse. Level’s Scope 3 emissions has been excluded due to being relatively small (less than 1% of the IAG footprint), a lack of dataand for a consistent approach.


ExplanationUpstream transportation and distribution emissions include fuel burn from vehicles used for fuel or cargo trucking, subcontractors'ground vehicles, and vehicles used in hub operations.

Waste generated in operations



Emissions calculation methodologyThe BA value has been calculated, and includes emissions from waste landfill gases, combustion, incineration and recycling.Values for Iberia and Aer Lingus have been calculated based on their available information, while a value for Vueling has beenestimated based on a ratio of waste to tonnes of fuel compared to the same ratio for BA. Level’s Scope 3 emissions has beenexcluded due to being relatively small (less than 1% of the IAG footprint), a lack of data and for a consistent approach.


ExplanationThe BA value has been calculated, and includes waste landfill gases, combustion, incineration and recycling. Values for Iberia andAer Lingus have been calculated based on their available information, while a value for Vueling has been estimated based on aratio of waste to tonnes of fuel compared to the same ratio for BA.

Business travel



Emissions calculation methodologyThe value for BA has been calculated, and includes business travel mileage claims and flying on non IAG carriers. For otheroperators, values are estimated based on the BA ratio to average manpower equivalent (number of staff). Level’s Scope 3emissions has been excluded due to being relatively small (less than 1% of the IAG footprint), a lack of data and for a consistentapproach.


ExplanationThe BA, Iberia and Aer Lingus values have been calculated, and include business travel mileage claims and flying on non IAGcarriers. Staff travel on IAG carriers is captured in scope 1. For Vueling, values are estimated based on the BA ratio of businesstravel to average manpower equivalent (number of staff).

CDP Page of 7434

Employee commuting



Emissions calculation methodologyThe BA value has been calculated based on employees commuting on staff buses.


ExplanationThe BA value has been calculated based on employees commuting on staff buses.

Upstream leased assets



Emissions calculation methodologyEstimated from supplier data where available and only where IAG operators have relevant activities. Level’s Scope 3 emissions hasbeen excluded due to being relatively small (less than 1% of the IAG footprint), lack of data and for a consistent approach.


ExplanationIncludes seasonal lease of aircraft and fuel upstream emissions.

Downstream transportation and distribution



Emissions calculation methodologyThis value includes the following types of emissions: • 3rd party air freight haulage for IAG Cargo • IAG Cargo's Road FeederService trucking (Global) • Cargo trucking from upstream transportation • IAG cargo emissions from subcontracted air freight andsubcontracted ground fleet. We primarily calculated these emissions using actual fuel burn


ExplanationThis value was calculated by multiplying actual fuel burn data by the relevant DEFRA conversion factors for diesel and aviationturbine fuel. For a few instances of subcontracted airfreight, we could not access primary fuel burn data. To estimate the emissions,we multiplied the total CTK (cargo-tonne kilometres) by our GSS freighters' average 'tonnes C02e per CTK' ratio.

CDP Page of 7435

Processing of sold products

Evaluation statusNot relevant, explanation provided

Metric tonnes CO2e<Not Applicable>

Emissions calculation methodology<Not Applicable>

Percentage of emissions calculated using data obtained from suppliers or value chain partners<Not Applicable>

ExplanationThis category does not apply to IAG. IAG offers air travel and transport services. As our 'product' is a transportation service ratherthan a physical item, the 'processing of sold products' is not relevant.

Use of sold products





ExplanationThis category does not apply to IAG. IAG offers air travel and transport services. As our 'product' is a transportation service ratherthan a physical item, the 'use of sold products' is not relevant.

End of life treatment of sold products





ExplanationThis category does not apply to IAG. IAG offers air travel and transport services. As our 'product' is a transportation service ratherthan a physical item, there is no relevant 'end of life' waste disposal-related emissions. If interested in our suppliers' productemissions, we estimate the emissions from aircraft manufacturing and disposal in the 'Capital Goods' section above.

CDP Page of 7436

Downstream leased assets





ExplanationAs a general rule IAG does not lease it's aircraft to other operators. The short-term lease of an aircraft to a 3rd party does occurfrom time to time. For example, in 2015 Vueling operated an ACMI for Evelop in wet lease modality (Technical Crew + Cabin Crew)from the bases of Tenerife, Barcelona and Palma de Mallorca. However, this is incidental rather than a core business activity. Dueto the infrequent and small scale nature of this, the emissions associated with downstream leased assets are not materiallyrelevant.

Franchises



Emissions calculation methodologyEstimated using fuel burn per km travelled for specific aircraft types.


ExplanationThe airlines Sunair and Comair are British Airways franchises but not within British Airways operational control although they arestill relevant emissions sources. 2015 was the first year we have calculated these emissions and they are included again for 2018.Similarly, Air Nostrum is an Iberia franchise not under Iberia operational control and Stobart Air is an Aer Lingus franchise, also notunder Aer Lingus operational control. Air Nostrum and Stobart Air emissions are included for the first time in 2017.

Investments



Emissions calculation methodologyEmissions from natural gas and electricity consumption at properties with the BA Pensions property portfolio. The natural gas andelectricity kilowatt figures are multiplied by the relevant UK Gov conversion factors into CO2e.


ExplanationBA Pensions owns a portfolio of properties across the UK. This figure represents the CO2e emissions resulting from natural gasand electricity consumption at these sites.

CDP Page of 7437

Other (upstream)

Evaluation statusNot evaluated




Explanation

Other (downstream)



Emissions calculation methodologyIberia scope 3 'other'


ExplanationTo capture the sum of total IB total scope 3 emissions consistent with verified.

C6.7

(C6.7) Are carbon dioxide emissions from biologically sequestered carbon relevant to your organization?No

C6.10

CDP Page of 7438

(C6.10) Describe your gross global combined Scope 1 and 2 emissions for the reporting year in metric tons CO2e per unitcurrency total revenue and provide any additional intensity metrics that are appropriate to your business operations.

Intensity figure0.0012382

Metric numerator (Gross global combined Scope 1 and 2 emissions)30220507

Metric denominatorunit total revenue

Metric denominator: Unit total24406000000

Scope 2 figure usedLocation-based

% change from previous year1.82

Direction of changeDecreased

Reason for changeOur CO2 intensity per unit of revenue improved in 2018. While our total revenue increased 6.7% in 2018 versus 2017, andavailable seat kilometres flown increased 6.1%, our scope 1 emissions only grew 4.8%. This reflects improvements in operationalfuel efficiency from the introduction of new more efficient aircraft, retirement of older aircraft and delivery of multiple operational fuelefficiency initiatives. Significant reductions in our location-based scope 2 emissions (-11%) were also achieved through efficiencyinitiatives, although scope 2 comprises just 0.2% of our combined Scope 1 & 2 emissions. Initiatives to reduce Scope 1 emissionsare detailed in section 4.3a and 4.3b.

C-TS6.15

CDP Page of 7439

(C-TS6.15) What are your primary intensity (activity-based) metrics that are appropriate to your emissions from transportactivities in Scope 1, 2, and 3?

Aviation

Scopes used for calculation of intensitiesReport just Scope 1


Metric numerator: emissions in metric tons CO2e29774627

Metric denominator: unitp.km

Metric denominator: unit total325410320249

% change from previous year-0.9

Please explain any exclusions in your coverage of transport emissions in selected category, and reasons for change inemissions intensity.Grammes of CO2 per passenger kilometre is a standard industry measure of fuel efficiency. Note that this metric is CO2 and notCO2e in line with industry standard practice. In 2018 IAG improved annual fuel efficiency by 0.9% compared to 2017, with ouraverage over the last six years equaling the industry target of 1.5%. These reductions are due to fuel efficiency initiatives and anongoing programme of fleet modernization, with 42 new more fuel efficient aircraft introduced in 2018 and 21 less efficient aircraftretired, sold or leased back. The lower rate of fuel efficiency improvement in 2018 was due to the rate of fleet renewal, changes inthe weight of cargo carried, as well as challenging operating conditions including disruption caused by European ATC strikes. Theimprovement in flight only emissions intensity of 0.9% is notable given that equivalent passenger kilometers flown increased by5.7% in the same period.

ALL

Scopes used for calculation of intensitiesReport Scope 1 + 2


Metric numerator: emissions in metric tons CO2e82271

Metric denominator: unitp.km

Metric denominator: unit total325410320249

% change from previous year-16

Please explain any exclusions in your coverage of transport emissions in selected category, and reasons for change inemissions intensity.This is a Scope 2 intensity figure but due to CDP categories has been listed as Scope 1 + 2 here. The metric is energy efficiencyper passenger kilometre (gCO2e/pkm) This became a new metric for IAG in 2017, designed to monitor our energy efficiency(Scope 2) as a function of our business activity (equivalent passenger kilometres). It complements our flight only emissionsintensity metric described above. The 16% reduction in location-based Scope 2 emissions intensity is particularly notable given thatequivalent passenger kilometres flown increased by 5.7% in the same period. An increase in the use of renewable electricityaffected this metric.

C7. Emissions breakdowns

CDP Page of 7440

C7.1

(C7.1) Does your organization break down its Scope 1 emissions by greenhouse gas type?Yes

C7.1a

(C7.1a) Break down your total gross global Scope 1 emissions by greenhouse gas type and provide the source of each usedgreenhouse warming potential (GWP).

Greenhousegas

Scope 1emissions(metrictons ofCO2e)

GWP Reference

CH4 16039 Other, please specify (UK Department for Transport)We have reported CO2 emissions using state approved emissions factors across our operations in the UK, Spain and Ireland. Therelevant emissions factors for CH4 is not provided by the Irish SEAI or the Spanish government. As a result we have used the UKDepartment for Transport's figures. This has resulted in a small disparity between our overall scope 1 as measured in CO2e and the sumof the reported emissions. We are confident that this is simply due to the lack of available conversion factors. We have therefore made asmall adjustment so that the overall scope 1 data reconciles.

N2O 285321 Other, please specify (UK Department for Transport)We have reported CO2 emissions using state approved emissions factors across our operations in the UK, Spain and Ireland. Therelevant emissions factors for CH4 is not provided by the Irish SEAI or the Spanish government. As a result we have used the UKDepartment for Transport's figures. This has resulted in a small disparity between our overall scope 1 as measured in CO2e and the sumof the reported emissions. We are confident that this is simply due to the lack of available conversion factors. We have therefore made asmall adjustment so that the overall scope 1 data reconciles.

CO2 29857108 IPCC Fifth Assessment Report (AR5 – 100 year)

C7.2

(C7.2) Break down your total gross global Scope 1 emissions by country/region.

Country/Region Scope 1 emissions (metric tons CO2e)

United Kingdom of Great Britain and Northern Ireland 19056578

Spain 8693620

Ireland 2217750

Austria 53000

France 90081

C7.3

(C7.3) Indicate which gross global Scope 1 emissions breakdowns you are able to provide.By business division

C7.3a

CDP Page of 7441

(C7.3a) Break down your total gross global Scope 1 emissions by business division.

Business division Scope 1 emissions (metric ton CO2e)

British Airways 19056578

Iberia 5982458

Vueling 2738370

Aer Lingus 2217750

Level 143081

C-CE7.4/C-CH7.4/C-CO7.4/C-EU7.4/C-MM7.4/C-OG7.4/C-ST7.4/C-TO7.4/C-TS7.4

(C-CE7.4/C-CH7.4/C-CO7.4/C-EU7.4/C-MM7.4/C-OG7.4/C-ST7.4/C-TO7.4/C-TS7.4) Break down your organization’s total grossglobal Scope 1 emissions by sector production activity in metric tons CO2e.

Gross Scope 1emissions, metrictons CO2e

Net Scope 1emissions , metrictons CO2e

Comment

Cement productionactivities

<Not Applicable> <Not Applicable> <Not Applicable>

Chemicals productionactivities


Coal productionactivities


Electric utilitygeneration activities


Metals and miningproduction activities


Oil and gasproduction activities(upstream)


Oil and gasproduction activities(downstream)


Steel productionactivities


Transport OEMactivities


Transport servicesactivities

30072215 <Not Applicable> This relates to our Scope 1 emissions arising from aircraft fuel burn only. It does not includeemissions from ground vehicles and other equipment which are included in our overall Scope1 figure.

C7.5

(C7.5) Break down your total gross global Scope 2 emissions by country/region.

Country/Region Scope 2, location-based (metric tonsCO2e)

Scope 2, market-based (metric tonsCO2e)

Purchased and consumedelectricity, heat, steam orcooling (MWh)

Purchased and consumed low-carbon electricity, heat,steam or cooling accounted in market-based approach(MWh)

United Kingdom ofGreat Britain andNorthern Ireland

46309 12903 163597 122812

Spain 32387 32222 82619 0

Ireland 3575 1687 8187 4290

CDP Page of 7442

C7.6

(C7.6) Indicate which gross global Scope 2 emissions breakdowns you are able to provide.By business division

C7.6a

(C7.6a) Break down your total gross global Scope 2 emissions by business division.

Business division Scope 2, location-based emissions (metric tons CO2e) Scope 2, market-based emissions (metric tons CO2e)

British Airways 46309 12903

Iberia 31698 31536

Vueling 689 685

Ireland 3575 1687

C-CE7.7/C-CH7.7/C-CO7.7/C-MM7.7/C-OG7.7/C-ST7.7/C-TO7.7/C-TS7.7

(C-CE7.7/C-CH7.7/C-CO7.7/C-MM7.7/C-OG7.7/C-ST7.7/C-TO7.7/C-TS7.7) Break down your organization’s total gross globalScope 2 emissions by sector production activity in metric tons CO2e.

Scope 2, location-based, metric tonsCO2e

Scope 2, market-based (if applicable), metric tonsCO2e

Comment

Cement production activities <Not Applicable> <Not Applicable> <NotApplicable>

Chemicals production activities <Not Applicable> <Not Applicable> <NotApplicable>

Coal production activities <Not Applicable> <Not Applicable> <NotApplicable>

Metals and mining production activities <Not Applicable> <Not Applicable> <NotApplicable>

Oil and gas production activities (upstream) <Not Applicable> <Not Applicable> <NotApplicable>

Oil and gas production activities(downstream)

<Not Applicable> <Not Applicable> <NotApplicable>

Steel production activities <Not Applicable> <Not Applicable> <NotApplicable>

Transport OEM activities <Not Applicable> <Not Applicable> <NotApplicable>

Transport services activities 82271 46812

C7.9

(C7.9) How do your gross global emissions (Scope 1 and 2 combined) for the reporting year compare to those of theprevious reporting year?Increased

C7.9a

CDP Page of 7443

(C7.9a) Identify the reasons for any change in your gross global emissions (Scope 1 and 2 combined) and for each of themspecify how your emissions compare to the previous year.

Change inemissions(metrictonsCO2e)

Directionof change

Emissionsvalue(percentage)

Please explain calculation

Change inrenewableenergyconsumption

4867 Decreased 0.02 In 2018, IAG’s total Scope 1 & 2 emissions (location-based) increased by 1,363,442 tonnes of CO2e – upfrom 28,867,205 tonnes to 30,220,507 tonnes Co2e. Our Scope 2 location-based emissions were just82,271 tonnes. British Airways and Aer Lingus increased their use of renewable electricity in 2018 (from65% to 75%, and 49% to 52% respectively), saving 4,867 tonnes of CO2e. IAG is committed to furtheraction on this and expects a further decrease in 2019 as Iberia and Vueling move to providers which offer100% renewable electricity. The calculation used here is: 4,867/28,867,205 = 0.02%

Otheremissionsreductionactivities

30708 Decreased 0.11 In 2018, specific initiatives to improve fuel efficiency and reduce emissions, as detailed in section C4,delivered 30,708 tonnes of CO2e savings. IAG also invests in fuel efficient aircraft as part of a fleetmodernisation programme, but the savings from this are not included here. The calculation used here is:30708/28,867,205 = 0.11%

Divestment <NotApplicable>

Acquisitions <NotApplicable>

Mergers <NotApplicable>

Change inoutput

1400041 Increased 4.85 In 2018, IAG business activity (as measured by equivalent passenger kilometres) rose by 5.7%. However,due to efficiency savings, our Scope 1 & 2 emissions only rose by 4.7% which equates to 1,364,466 tonnes.The increase in output is the difference i.e. 1,364,466 + 30708 + 4,867 = 1,400,041 Change in output as apercentage: (1,364,466/28,867,205)=4.85%

Change inmethodology

<NotApplicable>

Change inboundary

<NotApplicable>

Change inphysicaloperatingconditions

<NotApplicable>

Unidentified <NotApplicable>

Other <NotApplicable>

C7.9b

(C7.9b) Are your emissions performance calculations in C7.9 and C7.9a based on a location-based Scope 2 emissions figureor a market-based Scope 2 emissions figure?Location-based

C8. Energy

C8.1

(C8.1) What percentage of your total operational spend in the reporting year was on energy?More than 20% but less than or equal to 25%

C8.2

CDP Page of 7444

(C8.2) Select which energy-related activities your organization has undertaken.

Indicate whether your organization undertakes this energy-related activity

Consumption of fuel (excluding feedstocks) Yes

Consumption of purchased or acquired electricity Yes

Consumption of purchased or acquired heat No

Consumption of purchased or acquired steam No

Consumption of purchased or acquired cooling No

Generation of electricity, heat, steam, or cooling No

C8.2a

(C8.2a) Report your organization’s energy consumption totals (excluding feedstocks) in MWh.

Heating value MWh from renewablesources

MWh from non-renewablesources

Total MWh

Consumption of fuel (excluding feedstock) LHV (lower heatingvalue)

0 119650836 119650836

Consumption of purchased or acquired electricity <Not Applicable> 127102 127301 254403

Consumption of purchased or acquired heat <Not Applicable> <Not Applicable> <Not Applicable> <NotApplicable>

Consumption of purchased or acquired steam <Not Applicable> <Not Applicable> <Not Applicable> <NotApplicable>

Consumption of purchased or acquired cooling <Not Applicable> <Not Applicable> <Not Applicable> <NotApplicable>

Consumption of self-generated non-fuel renewableenergy

<Not Applicable> <Not Applicable> <Not Applicable> <NotApplicable>

Total energy consumption <Not Applicable> 127102 119778137 119905239

C8.2b

(C8.2b) Select the applications of your organization’s consumption of fuel.

Indicate whether your organization undertakes this fuel application

Consumption of fuel for the generation of electricity No

Consumption of fuel for the generation of heat No

Consumption of fuel for the generation of steam No

Consumption of fuel for the generation of cooling No

Consumption of fuel for co-generation or tri-generation No

C8.2c

(C8.2c) State how much fuel in MWh your organization has consumed (excluding feedstocks) by fuel type.

Fuels (excluding feedstocks)Jet Kerosene

Heating valueLHV (lower heating value)

Total fuel MWh consumed by the organization119355450

CDP Page of 7445

MWh fuel consumed for self-generation of electricity<Not Applicable>

MWh fuel consumed for self-generation of heat<Not Applicable>

MWh fuel consumed for self-generation of steam<Not Applicable>

MWh fuel consumed for self-generation of cooling<Not Applicable>

MWh fuel consumed for self-cogeneration or self-trigeneration<Not Applicable>

Comment

Fuels (excluding feedstocks)Natural Gas

Heating valueHHV (higher heating value)







Comment

Fuels (excluding feedstocks)Gas Oil








CommentGas oil used in vehicles.

CDP Page of 7446

Fuels (excluding feedstocks)Gas Oil








CommentGas oil used in generators/boilers.

Fuels (excluding feedstocks)Diesel








Comment

Fuels (excluding feedstocks)Petrol






CDP Page of 7447



Comment

C8.2d

(C8.2d) List the average emission factors of the fuels reported in C8.2c.

Diesel

Emission factor2.5918

Unitkg CO2e per liter

Emission factor sourceUK Department of Transport, Spanish Government, Irish SEAI

CommentThere are slight differences between the emissions factors used by the three states where IAG conducts business. The emissionfactor stated above is an average value that takes the proportion of consumption by state in to account.

Gas Oil


Unitkg CO2e per MWh

Emission factor sourceUK Department of Transport, Spanish Government, Irish SEAI

CommentThe value here relates to gas oil used in generators and vehicles. There are slight differences between the emissions factors usedby the three states where IAG conducts business. The emission factor stated above is an average value that takes the proportion ofconsumption by state in to account.

Jet Kerosene


Unitmetric tons CO2e per metric ton

Emission factor sourceUK Department for Transport

CommentIreland and Spain do not report an emissions factor for CO2e so the UK factor is assumed for all areas.

CDP Page of 7448

Natural Gas


Unitmetric tons CO2e per MWh

Emission factor sourceUK DfT, Spanish Government, Irish SEAI

CommentThere are slight differences between the emissions factors used by the three states where IAG conducts business. The emissionfactor stated above is an average value that takes the proportion of consumption by state in to account.

Petrol


Unitkg CO2e per liter

Emission factor sourceUK Department of Transport, Spanish Government

CommentThere are slight differences between the emissions factors used by the states where IAG conducts business. The emission factorstated above is an average value that takes the proportion of consumption by state in to account.

C8.2f

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(C8.2f) Provide details on the electricity, heat, steam and/or cooling amounts that were accounted for at a low-carbonemission factor in the market-based Scope 2 figure reported in C6.3.

Basis for applying a low-carbon emission factorContract with suppliers or utilities ( e.g. green tariff), supported by energy attribute certificates

Low-carbon technology typeSolar PVWindNuclearOther low-carbon technology, please specify (Unknown renewables)

Region of consumption of low-carbon electricity, heat, steam or coolingEurope

MWh consumed associated with low-carbon electricity, heat, steam or cooling112812

Emission factor (in units of metric tons CO2e per MWh)0

CommentIn 2018, 50% of IAG’s electricity across the Group was provided from renewable sources. British Airways (BA) procures electricityfor various facilities from multiple suppliers. Power at Heathrow, Glasgow and Gatwick airports is provided via renewable suppliers,and energy certificates are provided certifying the power source. For example, the power source for BA facilities at Heathrowairport is wind, and the power source for BA facilities at Glasgow is wind and solar. BA’s main facilities are on a separate greentariff with Haven Energy. Haven Energy does not provide a full breakdown of their energy sources but state that 84.3% is fromrenewable sources and 3.1% from nuclear. Source: https://www.havenpower.com/help/regulatory-fuel-mix/.

Basis for applying a low-carbon emission factorContract with suppliers or utilities (e.g. green tariff), not supported by energy attribute certificates

Low-carbon technology typeWind

Region of consumption of low-carbon electricity, heat, steam or coolingEurope

MWh consumed associated with low-carbon electricity, heat, steam or cooling4290

Emission factor (in units of metric tons CO2e per MWh)0

CommentIn 2018, 50% of IAG’s electricity across the Group was provided from renewable sources. 4,290MWh was from Aer Lingus, whohas a supply agreement for the provision of 100% renewable energy from Energia’s certified renewable portfolio. The source of thisenergy is wind. The following buildings benefit from this renewable energy Dublin Airport, Air Cargo Building Shannon Airport, IolarHouse Dublin Airport and Lismacleane, Shannon Industrial Estate.

C-TS8.4

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(C-TS8.4) Provide any efficiency metrics that are appropriate for your organization’s transport products and/or services.

ActivityAviation

Metric figure91.5

Metric numeratorOther, please specify (gCO2 per passenger kilometre)

Metric denominator<Not Applicable>

Metric numerator: Unit total29774627

Metric denominator: Unit total324893807249

% change from last year-0.9

Please explainThe metric is the focus of our activity targeting a reduction in the intensity of our flight operations by 10% by 2020 (to 87.3gCO2/pkm) compared to 2014 (97.5 gCO2/pkm). The numerator is flight only CO2 emissions which increased 4.8% from28,416,398 in 2017 to 29,774,627 in 2018.. The denominator is equivalent passenger kilometres which increased 5.7% from307,856,297,603 in 2017 to 325,410,320,249 in 2018. . In the reporting year we introduced three new types of fuel-efficient aircraftto the IAG fleet, 42 new aircraft which had higher levels of fuel efficiency, and sold or leased back 21 less efficient aircraft. Alongwith fuel efficiency initiatives, these collectively delivered a 0.9% fuel efficiency improvement compared to 2017, representing asaving of over 260,000 tonnes of CO2 relative to 2017 levels of efficiency.

C9. Additional metrics

C9.1

(C9.1) Provide any additional climate-related metrics relevant to your business.

C-TO9.3/C-TS9.3

(C-TO9.3/C-TS9.3) Provide tracking metrics for the implementation of low-carbon transport technology over the reportingyear.

ActivityAviation

MetricYearly purchase

Technology<Not Applicable>

Metric figure6

Metric unit<Not Applicable>

ExplanationBritish Airways (BA) purchased 6 Nissan Leaf vehicles in 2018 to replace conventional petrol/diesel vehicles at Heathrow airport. In

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2017 BA also purchased 28 Mototok units, which are zero emission electric devices used to move planes around at airportterminals. The Mototoks are used on approximately 170 short-haul flights a day, replace conventional fossil fuel burning vehicles,and save 7,400 tonnes of CO2 a year.

ActivityPlease select

MetricYearly purchase


Metric figure61


ExplanationIn 2018 Aer Lingus purchased 61 electric baggage tractors, belt loaders, passenger stairs and pushback tugs. Electric vehiclescurrently comprise 38% of the Aer Lingus Dublin Ground Operations Fleet, up from 27% in 2017.

ActivityAviation

MetricFleet adoption


Metric figure38


Explanation38% of Iberia Airport Services vehicles are now electric, up from 29% last year.

ActivityAviation

MetricOther, please specify (Percentage of Sustainable Aviation Fuel)


Metric figure0.01


ExplanationIAG is working to increase the share of Sustainable Aviation Fuel (SAF) used in aircraft across the Group. These fuels, over theirlifecycle, have 70-90% lower carbon emissions than standard fossil kerosene and so are an important way to reduce IAG'sabsolute Scope 1 emissions*. However, the supply of these fuels is very limited with only one small refinery in the USA regularlyproducing SAF at the present time. There are a number of plants planned and under construction but overall fuel volumes will stillbe low. In 2018, changes in UK and global policy have provided incentives which should increase production. In the UK, theRenewable Transport Fuels Obligation included aviation fuels within incentives from 2019. Internationally, CORSIA’s AlternativeFuels Task Force produced the framework for fuels to claim emission reductions from SAF use in the CORSIA scheme. A numberof airports trialled new fuel supply chains and some states announced SAF incentives and legislation. Many of the most promisingtechnologies are not yet operating at commercial scale, e.g. municipal waste residues to fuel. Without further investment and policysupport, securing commercial volumes of SAF will be very difficult. For more detail see case study at C11.3a. BA also sponsored aFuture Fuels competition for UK universities to identify promising technologies that can decarbonise aviation. The competition

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identified a number of technologies that have the potential to deliver negative emissions. BA continues to work with the top threeprojects to help them to scale up and derisk their projects. IAG is also investing in SAF and demonstrating leadership in this areathrough projects such as the British Airways and Velocys Waste to Jet fuel joint venture. *Fuel GHG savings are based on alifecycle GHG assessment so emission savings actually accrue in Scope 3. However, regulators count these fuels as low carbon inthe airline’s Scope 1 reporting under EU ETS and CORSIA.

C-TO9.6/C-TS9.6

(C-TO9.6/C-TS9.6) What is your investment in research and development (R&D), equipment, products and services andwhich part of it would you consider a direct investment in the low-carbon transition?

ActivityAviation

Investment start dateJanuary 1 2017

Investment end dateDecember 31 2037

Investment areaR&D

Technology areaAlternative fuels

Investment maturityLarge scale commercial deployment

Investment figure360000000

Low-carbon investment percentage81-100%

Please explainIAG is investing in sustainable Aviation Fuels (SAF) projects which turn waste into fuel. IAG is part of a pioneering project with UKrenewable fuels specialist Velocys to produce jet fuel from household waste which will then be supplied to British Airways. Over thelong-term we have committed over $400m USD over 20 years for SAF development, which equates to around 360m euros.Launched in September 2017, the first stage involves the engineering design of the plant and selecting the UK location for thefacility alongside stringent environmental and lifecycle carbon analysis of the technology. Once preparations are completed,building should begin in 2020, with production starting in 2024, making it one of the first plants in the world dedicated to producingbio jet fuel on a commercial scale. Ultimately, IAG hopes SAF could provide up to 25 per cent of its fuel by 2050. The fuel emits 70per cent less greenhouse gases and 90 per cent fewer particulates than fossil fuels, and the planned plant will produce around45,000 tonnes of jet and road transport fuels a year – delivering CO2 savings of over 95,000 tonnes annually. Recent changes tothe UK Renewable Transport Fuel Obligation, which sets targets for sustainable fuel use in transport, means the new fuel willqualify for government incentives to help develop the technology – something for which IAG and Sustainable Aviation (see Section12.3) has lobbied for nearly a decade. The incentives will bring down the fuel’s cost, making it more price competitive withtraditional fuels, helping make the business case for its adoption. The government has shown further support for the project byawarding Velocys a grant on the grounds of sustainable fuel’s potential to help meet the UK’s low-carbon vision. These projectssupport the UK’s strategic decarbonisation strategy, diverting waste from landfill and incineration. The initiative will be game-changing in terms of making waste-based fuels commercially viable and helping the industry reduce the impact it has on theenvironment.

ActivityAviation

Investment start dateJanuary 1 2017

Investment end dateDecember 31 2022

Investment area

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Services

Technology areaOperations

Investment maturityLarge scale commercial deployment

Investment figure3000000

Low-carbon investment percentage81-100%

Please explainIAG is investing in the Honeywell GoDirect Fuel Efficiency software tool across our operating companies British Airways, AerLingus, Iberia and Vueling. This new tool will help identify further fuel efficiency opportunities and enable group-wide benchmarkingand reporting on aircraft fuel efficiency performance. The software went live in Iberia, British Airways and Vueling in November2018. Our investment represents over 3 million euros over a period of five years.

C10. Verification

C10.1

(C10.1) Indicate the verification/assurance status that applies to your reported emissions.

Verification/assurance status

Scope 1 Third-party verification or assurance process in place

Scope 2 (location-based or market-based) Third-party verification or assurance process in place

Scope 3 Third-party verification or assurance process in place

C10.1a

(C10.1a) Provide further details of the verification/assurance undertaken for your Scope 1 and/or Scope 2 emissions andattach the relevant statements.

ScopeScope 1

Verification or assurance cycle in placeAnnual process

Status in the current reporting yearComplete

Type of verification or assuranceReasonable assurance

Attach the statementBA-GHG verification statement 2018.pdf

Page/ section referencePage 4 - British Airways emissions

Relevant standardISO14064-3

Proportion of reported emissions verified (%)

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63

ScopeScope 2 location-based





Page/ section referencepage 4 - British Airways emissions


Proportion of reported emissions verified (%)62

ScopeScope 2 location-based



Type of verification or assuranceLimited assurance

Attach the statement2018-statement-of-non-financial-information-en.pdf

Page/ section referencePage 26 - table of contents mentioning GHGs. page 54 - confirmation of limited assurance, 2018 timeframe, and notice of scope(IAG and subsidiaries). page 40 - mention of scope of reporting, Scope 1 & Scope 2 emissions (but note footnote 1, and see note insection C14) Page 42 - Scope 3 emissions (but see note in section C14) Page 56 - conclusion that IAG is in accordance withrelevant standards. Our verifiers provided assurance on the whole content of the Non-Financial Assurance Statement.

Relevant standardISAE3000


ScopeScope 1




Attach the statementINFORME EMISIONES 2018_ IBERIA LINEAS AEREAS_FIRMADO_AESA.pdfIV_IBERIA_EXPRESS_02_958_256910_signed.pdf

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Page/ section referenceInforme de emisiones Iberia - page 1 - 916943 tonnes Iberia Express - page 2 - 329653 tonnes

Relevant standardEuropean Union Emissions Trading System (EU ETS)


ScopeScope 1




Attach the statementIV_VUELING_02_958_257749.pdf

Page/ section referencePage 1 - Vueling - 2167198 tonnes



ScopeScope 1




Attach the statementVerified AEM Report 2018 Aer Lingus.pdf

Page/ section referencePage 15 - Aer Lingus - 848647 tonnes



C10.1b

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(C10.1b) Provide further details of the verification/assurance undertaken for your Scope 3 emissions and attach the relevantstatements.

ScopeScope 3- all relevant categories




Page/section referencepage 4 - Scope 3 emissions for British Airways.


C10.2

(C10.2) Do you verify any climate-related information reported in your CDP disclosure other than the emissions figuresreported in C6.1, C6.3, and C6.5?No, we do not verify any other climate-related information reported in our CDP disclosure

C11. Carbon pricing

C11.1

(C11.1) Are any of your operations or activities regulated by a carbon pricing system (i.e. ETS, Cap & Trade or Carbon Tax)?Yes

C11.1a

(C11.1a) Select the carbon pricing regulation(s) which impacts your operations.EU ETS

C11.1b

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(C11.1b) Complete the following table for each of the emissions trading systems in which you participate.

EU ETS

% of Scope 1 emissions covered by the ETS23

Period start dateJanuary 1 2018

Period end dateDecember 31 2018

Allowances allocated3584964

Allowances purchased4631233

Verified emissions in metric tons CO2e7006182

Details of ownershipFacilities we own and operate

CommentAviation has been part of the EU ETS since 2012. We have been actively lobbying for aviation inclusion in global carbon pricingscheme since 2008. In 2016 we achieved a significant milestone with global agreement at ICAO to implement CORSIA. From 2021we will participate in the CORSIA scheme and we await confirmation from the EU on coverage of the EU ETS. CORSIA is animportant stepping stone for IAG and aviation as a whole to meet its sectoral climate targets of carbon neutral growth from 2020and a net reduction of 50% by 2050, based on 2005 levels.

C11.1d

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(C11.1d) What is your strategy for complying with the systems in which you participate or anticipate participating?

lAG's strategy is to fully comply with the requirements of the EU ETS and any subsequent emissions trading schemes or market-based measures installed by countries in which the Group's airlines operate.

Overall strategy for compliance with EU ETS and CORSIA is co-ordinated at Group level and IAG also has dedicated peopleresponsible for EU ETS compliance in each airline managing the detailed monitoring, reporting and verification aspects. In addition,we engage third party verifiers to check and review our compliance reporting prior to annual submission to our regulators.

IAG manages the costs of compliance with EU ETS through our carbon management strategy applying the IATA four pillar strategy tominimise our emissions and exposure to compliance costs. This includes our investment in modern, fuel efficient aircraft, delivery ofoperational fuel efficiency, optimised airspace routing and investing in the production of sustainable aviation fuels to minimise ouremissions and compliance costs.

In addition, we employ a hedging strategy for the EU allowances we purchase to protect against price volatility. lAG operators forecastanticipated fuel consumption within scope of EU ETS and subsequently purchase allowances with the aim of ensuring full compliancewhile minimising compliance cost.

An example of how our strategy for compliance has been applied relates to our preparation for compliance with CORSIA, for whichthe baseline monitoring began on 1st January 2019. We have established an internal CORSIA working group comprisingrepresentatives from IAG Sustainability team and each airline’s EU ETS compliance manager, to share understanding of our newcompliance requirement of CORSIA, co-ordinate action and share expertise between our airline operating companies. We have alsoheld information sharing sessions and attended IATA CORSIA workshops to ensure we fully understand the compliancerequirements of the scheme. As a result, all our airlines submitted their plans to the relevant national regulators by 30th September2018.

C11.2

(C11.2) Has your organization originated or purchased any project-based carbon credits within the reporting period?No

C11.3

(C11.3) Does your organization use an internal price on carbon?Yes

C11.3a

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(C11.3a) Provide details of how your organization uses an internal price on carbon.

Objective for implementing an internal carbon priceNavigate GHG regulationsChange internal behaviorDrive low-carbon investmentStress test investmentsIdentify and seize low-carbon opportunities

GHG ScopeScope 1

ApplicationIAG employs an internal price of carbon in several areas of our business. including our business planning process which looksahead five years. For example: • Group Treasury departments apply carbon prices for forward planning and risk management ofour EU ETS and other emissions compliance obligations. • Fleet planning teams factor a carbon price into commercial decisionsaround aircraft fleet investments, engine investments and fleet retirement and renewal decisions to enable consideration of lifetimeoperating costs. • Sustainability teams apply carbon pricing including to future forecasts, and to inform scenario analysis of climaterelated risks and opportunities for IAG. Carbon prices are also applied to innovation and investment decisions, used to hedge ETSallowance purchases, for investments in fuel efficiency initiatives, and investment in Sustainable Aviation Fuel projects (see detailbelow).

Actual price(s) used (Currency /metric ton)20

Variance of price(s) usedOur forward planning team preparing for EU ETS compliance currently use an indicative carbon price for financial planning which is20 EUR in 2018. Future carbon prices applied for scenario planning follow low, medium and high scenarios. We drew on multiplesources to inform our future assumptions including the UK Department for Transport, UK Government's Airports Commission, UKCommittee on Climate Change and IPCC

Type of internal carbon priceShadow priceImplicit priceOffsets

Impact & implicationAn example of the impact of carbon pricing is IAGs investment in Sustainable Aviation Fuels (SAF): IAG applied carbon pricing toassess the future costs of fuel and climate-related compliance. The exercise identified that cost-competitive low-carbon aviationfuel could significantly reduce IAG's emissions compliance costs. Under the current rules of the EU ETS, sustainable fuels arezero-rated. SAF will also be eligible to reduce compliance obligations within CORSIA. In a future situation of high carbon prices, theavailability of sustainable fuel could offer a lower-cost route to compliance with carbon emissions schemes (ETS, CORSIA, carbontaxes etc). The application of carbon pricing in this context has underpinned our business strategy and informed our policy positionon SAF as well as shifting investments towards low carbon initiatives. It has enabled IAG to invest in a sustainable fuels team whohave lobbied for policy incentives to support the production of sustainable aviation fuel and to make financial investments intoinnovative first-of-a-kind technologies for sustainable fuel production. See our response to Section 9.6 for more details.

C12. Engagement

C12.1

(C12.1) Do you engage with your value chain on climate-related issues?Yes, our suppliersYes, our customers

C12.1a

(C12.1a) Provide details of your climate-related supplier engagement strategy.

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Type of engagementInnovation & collaboration (changing markets)

Details of engagementRun a campaign to encourage innovation to reduce climate impacts on products and servicesOther, please specify (Transporting jet fuel by rail not road)

% of suppliers by number0.4

% total procurement spend (direct and indirect)12

% Scope 3 emissions as reported in C6.50.1

Rationale for the coverage of your engagementFor this year’s CDP response, IAG has adopted a more rigorous definition of supplier engagement. IAG Global Business Services(IAG GBS) oversees the relationships with the Group’s more than 30,000 suppliers, of which 500 key suppliers make up 80% of ourspend. IAG GBS prioritises engagement with those suppliers who have a material impact on our business and on the environment,including on our climate change emissions, and so have the largest opportunity to reduce our impact. In terms of reducing ourScope 3 emissions, we currently have collaboration and innovation projects with key fuel suppliers who represent around 12% ofour overall procurement spend. The innovative collaboration ”Project Jigsaw” aims to shift the transport of jet fuel from road to railfor our London and Dublin hubs. Fuel, oil and emissions costs comprise 38 percent of supplier costs (EUR million 5,283 in 2018),and BA’s upstream transportation and distribution emissions represent 0.1% of our Scope 3 emissions, which is the basis for thenumbers above. We have revised our methodology for calculating engagement compared to previous years.

Impact of engagement, including measures of successIn terms of reducing our Scope 3 emissions, key measure of success is the CO2 savings via improvements in fuel transport. In2018, Project Jigsaw saved around 5000 tonnes of CO2e.

CommentWe collaborate with many suppliers to reduce our Scope 1 emissions via actions such as purchasing more efficient aircraft,operating along more efficient flight paths, and making changes to our ground operations. These collaborations are not included inour response to this question.

Type of engagementCompliance & onboarding

Details of engagementIncluded climate change in supplier selection / management mechanismCode of conduct featuring climate change KPIsClimate change is integrated into supplier evaluation processes

% of suppliers by number18

% total procurement spend (direct and indirect)28

% Scope 3 emissions as reported in C6.526

Rationale for the coverage of your engagementFor this year’s CDP response, IAG has adopted a more rigorous definition of supplier engagement. IAG Global Business Services(IAG GBS) oversees the relationships with the Group’s more than 30,000 suppliers, of which 500 key suppliers make up 80% of ourspend. IAG GBS prioritises engagement with those suppliers who have a material impact on our business and on the environment,including on our climate change emissions, and so the largest opportunity to reduce our impact. A requirement for environmentalstandards is included in the IAG Supplier Code of Conduct and shared with suppliers as part of the approval flow of the supplieronboarding process. There are two key ways we engage further with suppliers on their environmental impacts. Firstly, IAG GBSestablished in 2018 a more robust risk management process to facilitate due diligence and monitoring of IAG suppliers. IAG GBShas enlisted a major business intelligence provider to enrich understanding of our suppliers’ legal, social, environmental andfinancial compliance. To date, 5,500 suppliers have been screened during the first phase of deployment, which is 18% suppliersengaged by number. We have estimated that the screened suppliers are a representative sample from the categories of Scope 3emissions, bar franchises and business travel, which is how we have calculated that 26% of Scope 3 emissions are covered.Secondly, IAG GBS conducts corporate social responsibility (CSR) audits for chosen suppliers on an annual basis. Independent

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audits include assessments of environmental and business ethics. This engagement is aimed at providing standard framework,verifying of any corrective actions and requiring suppliers to improve environmental standards.

Impact of engagement, including measures of successKey measures of success for the screening process are being developed. However, one measure of success is the selection oflocal suppliers, which reduces carbon emissions from transport. On the project Catering London 2020 we appointed catererslocated in a 5-7 mile radius of each London hub, which reduced CO2 emissions although we have yet to quantify this.

CommentWe collaborate with many suppliers to reduce our Scope 1 emissions via actions such as purchasing more efficient aircraft,operating along more efficient flight paths, and making changes to our ground operations. These collaborations are not included inour response to this question.

C12.1b

(C12.1b) Give details of your climate-related engagement strategy with your customers.

Type of engagementEducation/information sharing

Details of engagementRun an engagement campaign to education customers about your climate change performance and strategy

% of customers by number16

% Scope 3 emissions as reported in C6.50

Please explain the rationale for selecting this group of customers and scope of engagementIAG transported 113 million passengers in 2018. In 2018, we shared sustainability insight with our passengers and customers inthe following specific ways: • Regular columns in the British Airways in-flight magazine High Life to inform customers aboutactivities on fuel efficiency and sustainability. • An Iberia website on the Iberia Sustainability Report 2017 which was launched inJune 2018 (https://memoriasostenibilidadiberia2017.iberiacomunicacion.com/en/) • Collaborating with the UK aviation tradeassociation Sustainable Aviation on social media communications. • Continuing to engage our customers by providing access tothe British Airways “Carbon Fund” (see section 4.5a). This fund uses customer donations from flight bookings on ba.com to investin renewable energy and energy efficiency projects, which provide community benefits and mitigate climate change. • Updatingsustainability content on our websites The emissions of all these customers are captured in our Scope 1 footprint and so theircontribution to Scope 3 emissions is listed as 0%. Climate-related engagement with corporate customers includes joint projectsthrough the BA Carbon Fund e.g. funding a project in a location of mutual interest e.g. a sustainable agriculture project in Ghana forexample that helps local people to set up new sustainable business models. Or supporting the corporate in understanding thecarbon market and helping source a suitable project through our charity partner Pure Leapfrog.

Impact of engagement, including measures of successFor individual customers, we measure the success of our engagement by the level of participation in our focus groups, voluntaryoffset or carbon reduction schemes, hits on websites and feedback received via social media. Around 2-3% of customers who bookflights online choose to voluntarily use the BA Carbon Fund. The Iberia website on their 2017 sustainability report received 18,272hits in 2018. On the basis of readership of British Airways in-flight magazines, which regularly feature sustainability articles, around16% of IAG customers have access to material that periodically includes information on climate change.

C12.3

(C12.3) Do you engage in activities that could either directly or indirectly influence public policy on climate-related issuesthrough any of the following?Direct engagement with policy makersTrade associations

C12.3a

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(C12.3a) On what issues have you been engaging directly with policy makers?

Focus oflegislation

Corporateposition

Details of engagement Proposed legislative solution

Cap andtrade

Support Policy makers engaged: •Civil servants in the UK,the European Union, andthe International CivilAviation Organisation(ICAO) Policies of interest:• EU policies: EUEmissions Trading System(EU ETS) • Global policies:ICAO's development of aGlobal MBM Method ofengagement • Member ofGlobal MBM Task Force ofICAO CAEP •Founder/member of UKEmissions TradingGroup(which is the primaryinterface between UKindustry and governmenton emissions trading) •Direct meetings with policy-makers

IAG continues to support the inclusion of aviation emissions in the EU ETS and has participated in thescheme since 2012. The full scope of the EU ETS is under review in order to allow the UN’s aviation bodyICAO to establish and demonstrate the success of its Global Market Based Measure, CORSIA. IAG hasactively supported negotiations to secure ‘CORSIA’: the Carbon Offsetting & Reduction Scheme forInternational Aviation. IAG was instrumental in securing the original 2009 industry targets (carbon neutralgrowth from 2020 and net reduction of 50% CO2 by 2050) which CORSIA is designed to address. Since thenIAG has been active in the process to formalise the targets under ICAO, and in 2016 we saw significantsuccess from this activity when ICAO secured political agreement to the scheme from 191 countries inOctober 2016.IAG helped successfully lobby with IATA to secure the following elements in CORSIA: (1) clarityon the geographic scope a state could apply measures within, (2) agreement that all airlines flying a routewould face equal treatment, (3) confirmation that the carbon offset concept is the most cost-effectiveapproach, (4) standardised requirements on monitoring and reporting & verification. CORSIA is the firstglobal sectoral deal to tackle climate change. It is a landmark achievement, not just for aviation, but also forthe global carbon market and we are proud of the significant role that IAG has played in securing it. Ourmethod of managing the opportunity to develop a single market mechanism for aviation emissions during2017 included our Group Head of Sustainability using his platform at the Gloval sustainable Aviation Summitin Geneva to encourage global political support for CORSIA. IAG also sent a delegation to participate in thenegotiations in ICAO as part of our industry trade association IATA’s delegation. IAG remains actively involvedwith three representatives developing the implementation plans and IAG Head of Sustainability chairingIATA’s CORSIA working group - to help ensure the success of CORSIA. We are also actively lobbying UKand EU Governments on the issue that CORSIA should replace aviation’s inclusion in the EU ETS and thereshould not be regulatory duplication.

Other,pleasespecify(Investmentlow carbonsustainablefuels)

Support Policy makers engaged: •Civil servants in the UK(DfT, BEIS) and theEU.Policies of interest: •UK Renewable TransportFuel Obligation • EURenewable EnergyDirective (EU RED), • EUFuel Quality Directive (EUFQD) Method ofengagement :• Directmeetings with policy-makers• Consultationresponses - submission ofwritten responses toconsultation documentsand participationinstakeholder consultationevents • Engagement asan individual entity, or as amember of industry groupslike 'Leaders forSustainable Biofuels' andSAFUG ( SustainableAviation Fuel usersGroup).

IAG and operator British Airways have been actively advocating: 1. The prioritisation of advanced fuelsmanufactured from wastes and residues, which avoid the land use change impacts that are associated withcrop-based fuels. 2. The work of the Roundtable on Sustainable Biomaterials (RSB) who have developed themost robust project-based sustainability standard for biofuels. 3. The introduction of standards to mitigateIndirect Land Use impacts such as the Low Indirect Impact Biofuels (LIIB) module offered by the RSB. 4.Greater harmonisation of standards with respect to sustainability and life cycle assessment of low-carbonfuels to ensure that these take account of the full life cycle impacts of fuel production. 5. Ensuring that a levelplaying field is provided by governments, so that aviation fuels are treated equally in relevant policyframeworks and incentives – with significant success recently since the UK Government agreed policychange to include advabnced aviation fuels as eligibly for subsidy under the RTFO incentives. 6. A role in theglobal market based mechanism for sustainable fuels that meet stringent sustainability criteria and deliverrobust greenhouse gas savings.

C12.3b

(C12.3b) Are you on the board of any trade associations or do you provide funding beyond membership?Yes

C12.3c

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(C12.3c) Enter the details of those trade associations that are likely to take a position on climate change legislation.

Trade associationIATA International Air Transport Assiciation

Is your position on climate change consistent with theirs?Consistent

Please explain the trade association’s positionThe International Air Transport Association (IATA) 69th Annual General Meeting (AGM) agreed a resolution on "Implementation ofthe Aviation Carbon-Neutral Growth (CNG2020) Strategy". The resolution proposes a set of principles for a global climateagreement on aviation emissions, specifically covering: • Establishment of procedures for a single global market-based measure(GMBM) • Integration of a single GMBM as part of an overall package of measures to achieve CNG2020 • Policy support andincentives to enable the development of sustainable aviation fuels to commercial scale.

How have you influenced, or are you attempting to influence their position?We actively advocate an approach for the Global Market-Based Measure which is equitable, achievable, and that can beimplemented by 2020. We take a leading role in relevant IATA environment committees and its climate change task force.

Trade associationA4E - Airlines For Europe


Please explain the trade association’s positionAirlines for Europe (A4E) support a global approach to regulating CO2 emissions from the aviation sector which avoids competitivedistortion and carbon leakage.

How have you influenced, or are you attempting to influence their position?IAG partnered with other major airlines to establish Airlines For Europe (A4E) in 2016. IAG has taken an active role in A4Eenvironment committees and has provided guidance to shape communications and policy positions in relation to the EU ETS,CORSIA and sustainable aviation fuels.

Trade associationLSB - Leaders for Sustainable Biofuels


Please explain the trade association’s positionLSB supports enhanced policy support for advanced fuel pathways (including aviation fuel). Types of policy support would includean EU-level sub-target for advanced biofuel.

How have you influenced, or are you attempting to influence their position?British Airways is a founding member and regular participant in group meetings and lobbying activities. We advocate forpreferential policy support for sustainable fuels produced from waste materials (e.g. municipal solid waste) that offer robust lifecyclegreenhouse gas reductions.

Trade associationSustainable Aviation


Please explain the trade association’s positionSustainable Aviation (SA) is a coalition of UK aviation sector companies including airlines, airports, ATC and aircraft manufacturers.Sustainable aviation supports industry efforts to influence UK climate policy on carbon trading as well as sustainable aviation fuels.

How have you influenced, or are you attempting to influence their position?IAG is a founding member of SA and is a member of the SA Council as well as sponsor of the Climate group, and an activeparticipant in the Noise and Communications working groups. In 2018, IAG staff chaired the Sustainable Fuels working group. Weinfluence SA position by sharing our expertise and insight on the CORSIA and have successfully influenced SA partners to supportthe IAG and IATA positions. SA also supports IAG position on sustainable fuels and has actively lobbied UK Government to createa level playing field for aviation and road transport fuels. IAG has been a lead partner in the SA programme to establish, with othermembers of SA and UK Government, a sustainable fuels UK knowledge transfer network.

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C12.3f

(C12.3f) What processes do you have in place to ensure that all of your direct and indirect activities that influence policy areconsistent with your overall climate change strategy?

The IAG sustainability team’s role is to drive change towards a more sustainable company and to achieve sector leadership to meetour goal of being the world’s leading airline group on sustainability. Our Group-wide Sustainability Network comprises environmentalrepresentatives and managers from across the Group who ensure Group strategy is applied to and is consistent with operatingcompany strategy. The IAG Sustainability Network meets regularly to develop work programmes and share learning and bestpractice across the Group and includes updates on direct and indirect engagement activities in relation to our climate change goals.

Climate change policy in IAG is governed at Board level and also through a sub-set of the Board: the Audit and ComplianceCommittee. This is where the Group’s strategic direction on sustainability and climate change policy are established, monitored andreviewed. The IAG Group Head of Sustainability is responsible for reporting on climate change aspects to the Chief of Staff and to theIAG Audit and Compliance Committee and IAG Management Committee which oversees the IAG risk management process includingthe assessment of and action on climate change-related risks.

IAG publishes its position on climate change policy including its involvement in ICAO's work on CORSIA for addressing aviationclimate emissions in its Annual Report and Accounts integrated sustainability report.

IAG and British Airways have proactively worked with other airlines to build a consensus approach to climate change policy. Thisapproach includes the position that a climate change regulation must achieve its intended environmental outcome in a cost effectiveway without causing competitive distortion between airlines.

IAG works with our Trade Associations to align consistent positions in relation to climate change wherever possible. For exampleduring 2017 and 2018 we have been working with GRI and the International Air Transport Association (IATA), to identify materialissues across the industry and develop a GRI Sectorial Guidance Handbook for airlines which will improve consistency andopportunities to benchmark our performance with other airlines.

C12.4

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(C12.4) Have you published information about your organization’s response to climate change and GHG emissionsperformance for this reporting year in places other than in your CDP response? If so, please attach the publication(s).

PublicationIn mainstream reports, incorporating the TCFD recommendations

StatusComplete

Attach the documentIAG Annual Report and accounts 2018.pdf

Page/Section referencePage 51

Content elementsGovernanceStrategyRisks & opportunitiesEmissions figuresEmission targetsOther metricsOther, please specify (Case studies)

CommentWe have carried out further analysis and verification since the publishing of the Annual Report and revised some metrics. Forexample, we calculate our 2018 flight efficiency at 91.5g CO2/km, rather than the 91.9g CO2/pkm reported.

C14. Signoff

C-FI

(C-FI) Use this field to provide any additional information or context that you feel is relevant to your organization's response.Please note that this field is optional and is not scored.

As noted in a footnote on page 40 of our Non-Financial Assurance Statement, IAG carries out further analysis and verification of ouremissions numbers after the publishing of the 2018 Annual Report. While all of our Scope 1,2 & 3 emissions have been verified tolimited assurance, the totals used in the CDP response are different to the 2018 Annual Report due to re-verification of the BritishAirways numbers and the use of a revised methodology for Scope 3 emissions. We have also revised some metrics e.g. we calculateour 2018 flight efficiency at 91.5g CO2/km, rather than the 91.9g CO2/pkm previously reported.

C14.1

(C14.1) Provide details for the person that has signed off (approved) your CDP climate change response.

Job title Corresponding job category

Row 1 Willi Walsh, Chief Executive Officer Chief Executive Officer (CEO)

SC. Supply chain module

SC0.0

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(SC0.0) If you would like to do so, please provide a separate introduction to this module.

Please refer to our response to question C0.1

SC0.1

(SC0.1) What is your company’s annual revenue for the stated reporting period?

Annual Revenue

Row 1 24406000000

SC0.2

(SC0.2) Do you have an ISIN for your company that you would be willing to share with CDP?No

SC1.1

(SC1.1) Allocate your emissions to your customers listed below according to the goods or services you have sold them inthis reporting period.

Requesting memberAccenture

Scope of emissionsScope 3

Allocation levelCompany wide

Allocation level detail

Emissions in metric tonnes of CO2e14000

Uncertainty (±%)10

Major sources of emissionsEmissions from staff business travel with British Airways and Iberia . 52,611 flights were taken with British Airways group, of which:6,192 were long haul premium, 6,103 were long haul non premium , 3,486 were short haul premium, 36,830 were short haul nonpremium31,298 flights were taken with Iberia group, of which: 506 were long haul premium, 654 were long haul non premium,1,122 were short haul premium 29,016 were short haul non premium. Geographic distribution was: UK and Ireland: 32,845 BAflights , 930Iberia flights North America: 4,040 BA and 358 Iberia flights Latin America and Carribbea: 467 BA and 341 Iberia flightsAfrica, Middle East & South America: 2,693BA and 69 Iberia flights Asia Pacific; 485BA, 20 Iberia flights Europe: 12,165BA and32,336 Iberia flights Spain: 1,443BA and 28,379 Iberia flights Revenue passenger kilometres: BA = 120,644,908 RPK Iberia =30,845,390 RPK Overall Total = 151,644,908 RPK

VerifiedNo

Allocation methodAllocation based on the volume of products purchased

Please explain how you have identified the GHG source, including major limitations to this process and assumptionsmadeWe have applied our average 2018 IAG fuel efficiency of 91.5 grammes of CO2 per passenger kilometre (gCO2/pkm) to the flightsundertaken by Accenture and used this as the basis for a CO2e total. This was calculated by estimating the distance of each flight

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(km) multiplied by our Group fuel efficiency metric. The methodology assumes a mix of business and economy class travel broadlyconsistent with IAG's fleet total. This is supported by the figures above showing major emissions sources. If one or other travelclass was favoured, the efficiency metric may become less accurate as, for example, business class is less efficient than economydue to lower seat density.

Requesting memberBank of America





Uncertainty (±%)10

Major sources of emissionsEmissions from staff business travel with British Airways and Iberia . 21,483 flights were taken with British Airways group, of which:7,609 were long haul premium, 967 were long haul non premium , 8,558 were short haul premium, 4,349 were short haul nonpremium. 1,249 flights were taken with Iberia group, of which: 85 were long haul premium, 50 were long haul non premium, 704were short haul premium 410 were short haul non premium. Geographic distribution was: UK and Ireland: 14,953 BA flights and662 Iberia flights North America: 4,869BA and 243 Iberia flights Latin America & Caribbean: 72 BA and 5 Iberia flights Africa,Middle East & South America: 430 BA and 6 Iberia flights Asia Pacific; 265 BA, 2Iberia flights Europe: 917BA and 533 Iberia flightsSpain: 28 BA and 121 Iberia flights Revenue passenger kilometres: BA = 66,881,544 RPK Iberia = 2,183,151 RPK Overall Total =69,064,695 RPK

VerifiedNo


Please explain how you have identified the GHG source, including major limitations to this process and assumptionsmadeWe have applied our average 2018 IAG fuel efficiency of 91.5 grammes of CO2 per passenger kilometre (gCO2/pkm) to the flightsundertaken by Bank of America Merrill Lynch and used this as the basis for a CO2e total. This was calculated by estimating thedistance of each flight (km) multiplied by our Group fuel efficiency metric. The methodology assumes a mix of business andeconomy class travel broadly consistent with IAG's fleet total. This is supported by the figures above showing major emissionssources. If one or other travel class was favoured, the efficiency metric may become less accurate as, for example, business classis less efficient than economy due to lower seat density.

Requesting memberEndesa


Allocation levelBusiness unit (subsidiary company)



Uncertainty (±%)10

Major sources of emissionsEmissions from staff business travel with British Airways and Iberia. 1,763 flights were taken with British Airways group, of which:646 were long haul premium, 21 were long haul non premium , 653 were short haul premium, 443 were short haul non premium.24,565 flights were taken with Iberia group, of which: 953 were long haul premium, 334 were long haul non premium, 1,044were

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short haul premium, 22,234 were short haul non premium. Geographic distribution was: UK and Ireland: 0 BA flights , 0 Iberiaflights North America: 16 BA and 11 Iberia flights Latin America & Caribbean: 41 BA and 1,413 Iberia flights Africa, Middle East &South America: 0 BA and 0 Iberia flights Asia Pacific; 0 BA, 0 Iberia flights Europe: 1,723 BA and 24,373 Iberia flights Spain: 102BA and 19,999Iberia flights Revenue passenger kilometres: BA = 5,938,094 RPK Iberia = 29,553,227 RPK Overall Total =35,491,321 RPK

VerifiedNo


Please explain how you have identified the GHG source, including major limitations to this process and assumptionsmadeWe have applied our average 2018 IAG fuel efficiency of 91.5 grammes of CO2 per passenger kilometre (gCO2/pkm) to the flightsundertaken by Endesa and used this as the basis for a CO2e total. This was calculated estimating the distance of each flight (km)multiplied by our Group fuel efficiency metric. The methodology assumes a mix of business and economy class travel broadlyconsistent with IAG's fleet total. This is supported by the figures below showing major emissions sources. If one or other travelclass was favoured, the efficiency metric may become less accurate as, for example, business class is less efficient than economydue to lower seat density.

Requesting memberKPMG UK





Uncertainty (±%)10

Major sources of emissionsKPMG UK emissions sources are from staff business travel with British Airways and Iberia . 37,422 flights were taken with BritishAirways group, of which: 6,958 were long haul premium, 1,554 were long haul non premium , 2,851 were short haul premium,26,059 were short haul non premium. 10,476 flights were taken with Iberia group, of which: 290 were long haul premium, 147 werelong haul non premium, 480 were short haul premium 9,559 were short haul non premium. Geographic distribution was: UK andIreland: 28,693 BA flights , 303 Iberia flights North America: 3650BA and 275 Iberia flights Latin America and Carribbean: 233 BAand 37 Iberia flights Africa, Middle East & South America: 342 BA and 9 Iberia flights Asia Pacific; 873BA, 13 Iberia flights Europe:3,660 BA and 10,021 Iberia flights Spain: 325 BA and 9,743 Iberia flights Revenue passenger kilometres: BA = 84,107,851 RPKIberia = 9,565,831 RPK Overall Total = 93,673,682 RPK

VerifiedNo


Please explain how you have identified the GHG source, including major limitations to this process and assumptionsmadeWe have applied our average 2018 IAG fuel efficiency of 91.5 grammes CO2 per passenger kilometre (gCO2/pkm) to the flightsundertaken by KPMG and used this as the basis for a CO2e total. This was calculated by estimating the distance of each flight(km) multiplied by our Group fuel efficiency metric. The methodology assumes a mix of business and economy class travel broadlyconsistent with IAG's fleet total. This is supported by the figures below showing major emissions sources. If one or other travelclass was favoured, the efficiency metric may become less accurate as, for example, business class is less efficient than economydue to lower seat density.

Requesting memberStanley Black & Decker, Inc.

Scope of emissions

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Scope 3




Uncertainty (±%)10

Major sources of emissionsEmissions from staff business travel with British Airways and Iberia . 2,083 flights were taken with British Airways group, of which:57 were long haul premium, 389 were long haul non premium 68 were short haul premium 1,571 were short haul non premium. 92flights were taken with Iberia group, of which: 0 were long haul premium, 10 were long haul non premium 0 were short haulpremium 82 were short haul non premium. Geographic distribution was: UK and Ireland: 1130 BA flights, 1 Iberia flights NorthAmerica: 284 BA and 5 Iberia flights Africa, Middle East & South America: 21 BA and 0 Iberia flights Asia Pacific; 29 BA, 0 Iberiaflights Europe: 615 BA and 74 Iberia flights. Spain: 40 BA and 41 Iberia flights Revenue passenger kilometres: BA = 3,914,732RPK Iberia = 161,826 RPK Overall Total = 4,076,558 RPK

VerifiedNo


Please explain how you have identified the GHG source, including major limitations to this process and assumptionsmadeWe have applied our average 2018 IAG fuel efficiency of 91.5 grammes of CO2 per passenger kilometre (gCO2/pkm) to the flightsundertaken by Stanley UK Holdings Inc, and used this as the basis for a CO2e total. This was calculated by estimating thedistance of each flight (km) multiplied by our Group fuel efficiency metric. The methodology assumes a mix of business andeconomy class travel broadly consistent with IAG's fleet total. This is supported by the figures above showing major emissionssources. If one or other travel class was favoured, the efficiency metric may become less accurate as, for example, business classis less efficient than economy due to lower seat density.

Requesting memberTD Bank Group





Uncertainty (±%)10

Major sources of emissionsEmissions from staff business travel with British Airways and Iberia. 1,590 flights were taken with British Airways group and 27were taken with Iberia Group. Geographic distribution was: UK and Ireland: 1,355 BA flights , 22 Iberia flights North America: 235BA and 11 Iberia flights. Latin America and Caribbean: 0 BA and 0 Iberia flights Africa, Middle East & South America: 0 BA and 0Iberia flights Asia Pacific; 0 BA, 0 Iberia flights Europe: 0 BA and 0 Iberia flights Spain: 0 BA and 0 Iberia flights Revenuepassenger kilometres: BA = 4,122,547 RPK Iberia = 37,129 RPK Overall Total = 4,159,676 RPK

VerifiedNo


Please explain how you have identified the GHG source, including major limitations to this process and assumptionsmade

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We have applied our average 2018 IAG fuel efficiency of 91.5 grammes of CO2 per passenger kilometre (gCO2/pkm) to the flightsundertaken by Toronto Dominion Bank and used this as the basis for a CO2e total. This was calculated by estimating the distanceof each flight (km) multiplied by our Group fuel efficiency metric. The methodology assumes a mix of business and economy classtravel broadly consistent with IAG's fleet total. This is supported by the figures below showing major emissions sources. If one orother travel class was favoured, the efficiency metric may become less accurate as, for example, business class is less efficientthan economy due to lower seat density.

Requesting memberVodafone Group





Uncertainty (±%)10

Major sources of emissionsEmissions from staff business travel with British Airways and Iberia . 22,309 flights were taken with British Airways group, of which:2523 were long haul premium, 589 were long haul non premium 741 were short haul premium 18,456 were short haul nonpremium. 12,363 flights were taken with Iberia group, of which: 213 were long haul premium, 7were long haul non premium 331were short haul premium 11,812 were short haul non premium. Geographic distribution was: UK and Ireland: 14,755 BA flights ,909Iberia flights North America: 310BA and 18 Iberia flights Africa, Middle East & South America: 549 BA and 33 Iberia flights AsiaPacific; 179 BA, 8 Iberia Europe: 6,517 BA and 11,952 Iberia Spain: 468 BA and 10,970 Iberia flights Revenue passengerkilometres: BA = 39,034,142 RPK Iberia = 11,081,514 RPK Overall Total = 50,115,656 RPK

VerifiedNo


Please explain how you have identified the GHG source, including major limitations to this process and assumptionsmadeWe have applied our average 2018 IAG fuel efficiency of 91.5 grammes of CO2 per passenger kilometre (gCO2/pkm) to the flightsundertaken by Vodafone Group and used this as the basis for a CO2e total. This was calculated by estimating the distance of eachflight (km) multiplied by our Group fuel efficiency metric. The methodology assumes a mix of business and economy class travelbroadly consistent with IAG's fleet total. This is supported by the figures above showing major emissions sources. If one or othertravel class was favoured, the efficiency metric may become less accurate as, for example, business class is less efficient thaneconomy due to lower seat density.

Requesting memberWells Fargo & Company





Uncertainty (±%)10

Major sources of emissionsEmissions from staff business travel with British Airways and Iberia 4,473 flights were taken with British Airways group, of which1,213 were longhaul premium, 292 were longhaul non-premium, 379 were shorthaul premium, 2,589 were shorthaul non-premium.

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75 flights were taken with Iberia group, of which 5 were longhaul premium, 10 were shorthaul premium and 60 were shorthaulnonpremium.Geographic distribution was: UK and Ireland: 2,884 BA flights , 59 Iberia flights North America: 1,431 BA and 70Iberia flights Latin America and Caribbean: 0 BA and 0 Iberia flights Africa, Middle East & South America: 153 BA and 0 Iberiaflights Asia Pacific; 12 BA, 0 Iberia flights Europe: 0 BA and 0 Iberia flights Spain: 0 BA and 0 Iberia flights Revenue passengerkilometres: BA = 12,979,841 RPK Iberia = 123,642 RPK Overall Total = 13,103,483 RPK

VerifiedNo


Please explain how you have identified the GHG source, including major limitations to this process and assumptionsmadeWe have applied our average 2018 IAG fuel efficiency of 91.5 grammes of CO2 per passenger kilometre (gCO2/pkm) to the flightsundertaken by Wells Fargo & Co and used this as the basis for a CO2e total. This was calculated by estimating the distance ofeach flight (km) multiplied by our Group fuel efficiency metric. The methodology assumes a mix of business and economy classtravel broadly consistent with IAG's fleet total. This is supported by the figures below showing major emissions sources. If one orother travel class was favoured, the efficiency metric may become less accurate as, for example, business class is less efficientthan economy due to lower seat density.

SC1.2

(SC1.2) Where published information has been used in completing SC1.1, please provide a reference(s).

The principle metric used for calculating the CO2e emissions above are IAG's fight only CO2 efficiency for 2018 of 91.5 grammes ofCO2 per passenger kilometre (gCO2/pkm). Our performance and trends on this measure over five years is reported in the IAGAnnual Report and Accounts 2018, reference is page 58. In our Annual Report we reported our flight only CO2 efficiency as 91.9grammes of CO2 per passenger-km, but have since revised this following further analysis.

SC1.3

(SC1.3) What are the challenges in allocating emissions to different customers, and what would help you to overcome thesechallenges?

Allocationchallenges

Please explain what would help you overcome these challenges

Other, pleasespecify(Factorsaffecting flightefficiency)

It would be extremely complex and time-consuming to determine an exact measurement of emissions for an individual passenger on any givenflight and route. Each flight can vary by its aircraft seating configuration and travel class, aircraft types, weather conditions, holding patterns, loadfactors, and haulage of bellyhold cargo. The challenge is to provide data which is representative of a given passenger's emissions, and ourpreferred method of emissions allocation is using an aggregate efficiency figure based upon externally verified data.

SC1.4

(SC1.4) Do you plan to develop your capabilities to allocate emissions to your customers in the future?Yes

SC1.4a

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(SC1.4a) Describe how you plan to develop your capabilities.

We continue to work on standardising the greenhouse gas emissions and efficiency calculations across the Group. This ensures thatthe allocated emissions we report to customers continue to be consistent and accurate.

SC2.1

(SC2.1) Please propose any mutually beneficial climate-related projects you could collaborate on with specific CDP SupplyChain members.

SC2.2

(SC2.2) Have requests or initiatives by CDP Supply Chain members prompted your organization to take organizational-levelemissions reduction initiatives?No

SC3.1

(SC3.1) Do you want to enroll in the 2019-2020 CDP Action Exchange initiative?No

SC3.2

(SC3.2) Is your company a participating supplier in CDP’s 2018-2019 Action Exchange initiative?No

SC4.1

(SC4.1) Are you providing product level data for your organization’s goods or services?No, I am not providing data

Submit your response

In which language are you submitting your response?English

Please confirm how your response should be handled by CDP

Public or Non-Public Submission I am submitting to Are you ready to submit the additional Supply Chain Questions?

I am submitting my response Public InvestorsCustomers

Yes, submit Supply Chain Questions now

Please confirm belowI have read and accept the applicable Terms

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Change 2019 International Consolidated Airlines Group, S.A ...

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