Our work to improve on our established environmental and sustainability efforts includes executing our sustainability roadmap aligned with the Task Force on Climate-Related Financial Disclosure.
Xero’s environmental sustainability objectives
Building on our efforts and achievements to date, we will continue to positively contribute to environmental sustainability. Our objectives are to:
- reduce electricity consumption in buildings
- reduce waste and increase recycling
- evaluate our greenhouse gas emissions footprint
- reduce greenhouse gas emissions by encouraging alternative modes of transport for employees
- minimize carbon intensive travel options like air travel, and encourage video and teleconference style meetings
- enhance procurement processes so that environmental impacts are a key consideration when engaging with our supply chain (eg, minimizing the carbon impact of transportation)
Net Zero @ Xero
Our environmental sustainability program, Net Zero @ Xero, represents our journey towards net-zero* carbon emissions by 2050.
Xero has offset 100% of its carbon emissions since FY19 and has been certified carbon neutral by the Australian Government’s Climate Active program since FY20 and is committing to doing so each year in the future.
Xero has set the following emissions reduction targets in line with climate science:
- 42% reduction in Scope 1 and 2 emissions from FY20 by FY30
- 17% reduction in Scope 3 emissions from FY20 by FY30
- Net-zero* emissions no later than FY50
*Emissions reduced to a point where fewer than 10 percent of total emissions require abatement through offsets as defined by the Science Based Targets initiative Net-Zero guidance.
Xero will work towards achieving these targets by focusing on the areas of increased renewable energy uptake, being more strategic about business travel, and switching to more sustainable catering wherever possible.
Our carbon reduction journey
More information about Xero’s FY20 and FY21 carbon disclosure, emission reduction plans, and the projects selected to offset our emissions, are on the Climate Active website.
Read more in the Xero blog
Clean green office spaces
We continue to implement initiatives aimed at reducing our electricity consumption, such as ‘switch it off’ signage; sensor and timer lighting; extensive use of LED lighting in all offices; working with air conditioning engineers and landlords to improve the efficiency of systems; and automating switching off of AV equipment.
As part of our Net Zero @ Xero program, we have set emissions reductions targets (aligned to the Science Based Targets initiative) to lower electricity consumption and its carbon impact. Over the last three financial years, Xero has purchased electricity amounting to:
- FY20: 3,026,102 kWh
- FY21: 1,709,129 kWh
- FY22: 2,423,787 kWh
During this period, our absolute consumption has increased, but at a slower rate relative to the growth in office space. Thanks to our electricity reduction initiatives, and a focus on energy efficiency in new office designs, we have reduced electricity consumption by 25% per square metre of space occupied in FY22 from FY21. This calculation is based on total kWh consumption by Xero offices (actuals only) and divided by the associated NLA for those sites. This excludes offices where modelled data has been used.
Xero is also compliant with the Energy Savings Opportunity Scheme in the United Kingdom. Two of our UK offices run on renewable energy (London: 100% and Manchester: 50%) and our London office is certified carbon neutral.
Data center storage
Xero uses Amazon Web Services (AWS) as our cloud services platform partner.
AWS is committed to running its business in the most environmentally friendly way possible and achieving 100% renewable energy usage for its global infrastructure by 2025. We're also working with AWS to determine how we can optimize infrastructure utilization.
We are continually improving our recycling methods. We already:
- recycle paper, glass, hard plastic, aluminium and tin cans and cardboard
- undertake composting where these services are available in leased offices
- have eliminated the use of bottled water in all offices
- endeavour to source all paper for printing from FSC/PEFC sources
- use paper hand towels and toilet paper from recycled FSC/PEFC sources where we have direct control of supplies
- procure recycling services for printer toner cartridges, batteries and electronic waste
- return leased IT equipment (principally laptops) at the end of its life
- recycle non-leased IT equipment (printers, screens etc) where possible via certified e-waste companies
As part of our Net Zero @ Xero program, our initiatives and employee commitment to waste minimisation and recycling has reduced the proportion of our waste that goes to landfill from 63% in FY19 to 40% in FY20.
Responsible supply chain
To maximize our impact through our supply chain, we’re continually looking at ways to make more sustainable purchasing decisions in our everyday work.
Some of the other ways in which we are making improvements through more sustainable decisions include:
- Since 2019, our annual reports are Forest Stewardship Council (FSC) accredited and are printed with vegetable inks.
- Our major vendor, Amazon Web Services (AWS) is committed to running its business in the most environmentally friendly way possible and achieving 100% renewable energy usage for its global infrastructure by 2025. We're also working with AWS to determine how we can optimize infrastructure utilization.
- In 2019, we introduced more sustainable options for our thousands of Xerocon attendees. You can read more about our improvements at Xerocon Brisbane here.
- Since 2019, we’ve used ethically sourced organic cotton for our staff t-shirts.
We provide end-of-trip facilities, including secure bike parking, showers, and well-equipped changing rooms in all our newer buildings to better support alternative modes of transport. Charging points for electric vehicles are also available.
Where possible we aim for our office spaces to be Green Star, LEED, BREEAM or NABERS certified.
- In March 2022 we opened our new 7,580m2 Australian headquarters building in Melbourne, which was designed with sustainability in mind. It’s our largest office building and has more than 220 solar panels, a rainwater harvesting system, and 10 electric vehicle charging stations. The office was built to meet NABERS 5* standards.
- The Wellington building which opened in 2017 is our second largest office at 6,804m2. It was built with Green Star principles but is not certified.
- The Auckland office has a 5* Green Star rating (6,800m2, our third largest office).
- Our Napier office has solar panels.
- The Denver office is LEED Platinum rated (2,786m2, our fifth largest office) and includes solar panels.
- Our Toronto office is BOMA gold-rated.
Supporting sustainable small business
Part of managing our sustainability at Xero is supporting small businesses to become more sustainable and helping them operate in socially and environmentally responsible ways.
Of the small businesses surveyed by Xero, 68% told us they wanted to become more sustainable but needed help achieving this. Xero’s small business sustainability hub includes helpful information and resources from across the globe to help our small business customers and partners to achieve their sustainability goals.
Several of our Xero app partners are also helping small businesses operate more sustainably. They offer a range of capabilities such as carbon measurement and management. Learn more at the Xero App Store.
We’re committed to connecting our customers with the most relevant, scalable resources and support models to help them operate in an environmentally conscious way.
Aligning with the Taskforce on Climate-related Financial Disclosures (TCFD)
We’ve established a reporting and governance framework to support delivery of our climate strategy, reflecting our commitment to stronger climate-related governance. We have started the journey towards alignment with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). Our focus in FY22 has been on building a strong foundation and to develop a roadmap to implement the TCFD framework progressively across our business.
Xero's Annual Report 2022 outlines our performance for the year to 31 March 2022 and also includes details of our work in sustainability, and our latest gender diversity figures.