VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010

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VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
VIRGIN GROUP’S
CORPORATE
RESPONSIBILITY
AND SUSTAINABLE
DEVELOPMENT
REPORT
2010
VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
VIRGIN GROUP’S
CORPORATE
RESPONSIBILITY
AND SUSTAINABLE
DEVELOPMENT
REPORTwell... it’s not really a report... it’s more of a...

                                                 way
                                          this
VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
think piece
            or “Dicussion Document”. It’s basically...

VIRGIN’S VIEW ON A SUSTAINABLE LIFESTYLE
                  doing to help people get closer to that
  and what we are
VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
CONTENTS
                                VIRGIN GROUP’S CORPORATE RESPONSIBILITY AND
                                SUSTAINABLE DEVELOPMENT REPORT

    page

       6      A Message from Richard Branson

              The view from the top
       7      By Stephen Murphy (group CEO) and Peter Norris (group Chairman)

              Managing corporate responsibility &
       8      sustainable development across the group
              An explanation of what sustainability means to the Virgin companies, how the Virgin Group
              is structured and our governance process

      12      What Virgin is up to around the world

      14      THE VIRGIN TIMELINE

                                       16       Flying High
                                                Virgin Atlantic, Virgin America, Virgin Blue Group,
                                                Air Asia X, Belgium Air

                                      24        We’re all going on a Summer Holiday
                                                Virgin Holidays, Virgin Limited Edition

      Lifestyle                       32        Getting from A to B
      themes                                    Virgin Trains, Virgin Limobikes, Virgin Racing
      Virgin’s
      thoughts, the                     38 Staying in Touch
      key issues and                            Virgin Media, Virgin Mobile, Virgin Digital Help
      the companies’
      impacts, actions                 46       Watching the Pennies
      and intentions                            Virgin Money, Virgin Green Fund

                                       50 My Body is a Temple
                                                Virgin Active, Virgin HealthMiles, Virgin Life Care, Virgin Spa

                                       56       Out of this World
                                                Virgin Galactic

                                                Relax and have Fun
                                       60       Virgin Media, Virgin Books, Virgin Games, Virgin Wines,
                                                Virgin Experience Days, Virgin Balloon Flights,
                                                Virgin Festivals, Virgin Radio International

     68       The Virgin people story
              Our People: The HR department’s review of Virgin’s policies, achievements and how it is striving to do more
              Our Customers: Virgin’s philosophy behind being the consumer’s champion

     74       Virgin Unite and the ‘big ideas’
              Virgin Unite, The Elders, The Carbon War Room, Disease Control Hub, the Virgin Earth Challenge,
              the next big idea and our view on forests

4
VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
Richard Branson
VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
A message from Richard
    Someone wiser than I once said that ‘knowledge is power’ – and so in the 21st Century we have no excuse to sit
    back and let our planet and its people continue to suffer. As “global citizens” of the world we are facing serious
    environmental and social challenges; climate change, a lack of key resources, widespread poverty, conflicts and
    enormous population growth are all threatening to destabilise our fragile status quo. Scientists have been telling
    us for years that we cannot continue to live the way we do and at last some of us have started to listen, started
    to act and started to turn back the tide, little by little – at last having grasped that in our small global village
    what affects our neighbours, affects us all.

    It would be easy to be overwhelmed by the scale of these global issues, but I am an optimist at heart and I
    believe in the power of entrepreneurship and innovation. The human race has demonstrated a tremendous
    capacity to change and adapt in the past and I have faith we can do it again. At Virgin we’re working together
    to make a difference, by implementing small changes in the way we work, by continuously investing in green
    technologies and by exploring new possibilities in science and beyond. I believe that in the future we will be
    able to enjoy healthy and fulfilling lifestyles, whilst minimising the negative impact we have on the world. What
    seems impossible today could be possible tomorrow.

    The world has changed a great deal in the 40 years since the Virgin Group started, but I’m proud to be able to
    say that we’ve moved with the times and we’re still listening. We’ve set up a foundation, Virgin Unite, to help
    us listen, bring people together and tackle issues with entrepreneurial approaches. We’re also listening to the
    exceptional men and women who form The Elders, to the scientists, partners and entrepreneurs who make up
    the Carbon War Room - all these people are helping to educate us as to what is needed both globally and at a
    grass roots level to help make a difference to lives on a daily basis.

    Richard Branson

6
VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
The view from the top
  By Stephen Murphy (group CEO) and Peter Norris (group Chairman)

We have always considered ourselves to be a responsible business, and whilst we have understood the
environmental and social pressures of our world, this is the first time we have outlined our thoughts and views
on corporate responsibility and sustainable development for the whole Virgin Group.

At Virgin we have always looked for new, innovative ways to do business by offering consumers another way, a
better way, and by being willing to fight their corner. We are determined Virgin will prove that living sustainably
and responsibly need not be considered difficult or dull. Sustainable living is often portrayed as a life of
sacrifice and compromise as opposed to the choice and freedom we currently enjoy. Unsurprisingly people
aren’t motivated by this vision. We want our Virgin companies to provide responsibly produced, sustainable,
low carbon services and products that are desirable, easy to use and good value above all else so that our
customers can enjoy their lifestyles safe in the knowledge that Virgin is acting responsibly on their behalf.

We designed this report (although we feel like it’s more of a story to which we haven’t yet written an ending…)
to highlight the enormous range of sustainability issues the Virgin companies face, operating in so many
different sectors. Virgin’s products and services span many aspects of life, from mobile phones and financial
products to holidays and health clubs. Our challenges and opportunities are consequently just as diverse, but
we recognise this gives us the potential to contribute in a meaningful way to a vision of a sustainable lifestyle.
We want to use the report to explain how our companies are doing this - addressing their impacts and realising
the opportunities – and also to share our vision on responsibility and sustainability along with our plans for the
future.

As a member of the Virgin Group, each business is responsible for making its contribution to our vision of
sustainability. For some, such as the airlines, the task is far harder and so we recognise that each business will
progress at its own pace. However, we expect each Virgin company to fully understand its environmental and
social impacts, have the ambition to lessen these impacts and work to exert its influence to lessen the impacts
of its sector.

We are proud of what our companies have achieved so far and some initiatives in particular have really set
the bar high for sustainable practices within the group. However, we’re also committed to pushing them to go
further and be more ambitious with their goals. ‘Business as usual’ is no longer an option - the world simply
doesn’t have enough natural resources to maintain current trends of consumption, and the consequences of
climate change and environmental degradation are severe. The global issues we face today are enormous
and to solve them we all need to work together towards living more sustainably. To support this, we’ve also
established a non-profit foundation, Virgin Unite, that works with our businesses, Richard and global partners to
drive change and to encourage entrepreneurial approaches to some of the tough challenges the world is facing
today.

As a society we need to be prepared for change. Businesses, governments and individuals need to speak
the same language and act together to make the right decisions to shape our lives for the future. No single
company can solve these problems but if we have the courage to unite, we can find the creative, pragmatic and
bold solutions required to meet these challenges head on.

Stephen Murphy                                   Peter Norris

                                                                                                                      7
VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
This definition of sustainable
    development comes from Gro
    Harlem Brundtland, Prime Minister
    of Norway and author of Our                                 allenges
                                                   Group’s ch
    Common Future (1987).               The Virgin       an d varied:
                                                    id e
                                        are very w

                                                        Atlantic
                                           The Virgin
                                                           team is
                                           sustainability                s
                                                            to reduce it
                                           working hard
                                                                   issi s,
                                                                       on
                                           company’  s carbon em
                                                                           nt
                                                           is less releva
                                            a goal which
                                                         Games, which
                                            for Virgin                    nt,
                                                            rbon footpri
                                             has a tiny ca             to
                                                           d worki  ng
                                             but is instea                  .
                                                          bl ing addiction
                                             prevent gam
8
VIRGIN GROUP'S CORPORATE RESPONSIBILITY AND SUSTAINABLE DEVELOPMENT REPORT 2010
Managing corporate responsibility & sustainable
 development across the group
 So what does this mean for the Virgin                          also has a role to play in encouraging responsible drinking,
 companies?                                                     and Virgin Money’s predominant social issue is advocating
                                                                responsible lending.
 We have interpreted this definition of sustainable
 development into four main challenges which we believe         Because of this wide variation in the challenges our
 businesses need to meet in the 21st century:                   different companies face, we decided that highly focused
                                                                group-wide targets and KPIs would be inappropriate and
 • emit minimal carbon and other greenhouse gases               fail to tackle the sector specific impacts sufficiently .
 • learn to use the planet’s finite resources responsibly       Instead we developed the Product Story approach
                                                                (explained in more detail on the next page) and asked
 • strive towards poverty alleviation and the fair treatment    each company to review its own individual sustainable
   of all individuals                                           development story, enabling them to examine on a
 • offer products and services that enhance emotional and       case-by-case basis how they are meeting the four
   physical wellbeing.                                          challenges outlined above and where they need to make
                                                                improvements.
 We believe that we have a part to play in making this
 a reality and so our vision for sustainability within the      Whilst we have already come a long way, the road
 Virgin Group is to: “make a credible contribution towards      stretches indefinitely in front of us. Sustainable living is not
 sustainable lifestyles whilst meeting or exceeding the         the latest vogue or a fad that will die out. We are making a
 expectations of our staff, customers and stakeholders”.        long-term commitment; we aspire to become greener and
                                                                more responsible every year. Although Virgin is big, we can
 Our path towards sustainability is based on development        achieve relatively little in the grand scheme of things just
 by means of enlightened capitalism. We have to change          by reducing our own impacts. However, by continuously
 the way we run our businesses by; channelling the              trying to lead the debate, raising the bar, challenging
 entrepreneurial spirit of our people, pioneering new           our competitors and lobbying governments, we can
 technologies, funding Research and Development (R&D)           make sustainable businesses a reality as well as being
 and thereby reducing the resources we use. Then we have        economically beneficial.
 to encourage our competitors to do the same. So it’s not
 only about profits – it’s about adapting and developing        Since Virgin companies span so many sectors, it wouldn’t
 the products we sell and services we provide, to ensure we     be relevant for us to outline just one set of targets and one
 look after people and the planet, now and in the future.       area of focus. Instead we decided the best approach was
                                                                to explain what issues face the sectors that our companies
 Some of our companies have relatively small environmental      operate in and explain what the Virgin companies are
 footprints, but more significant social impacts which          doing both to maximise their positive impacts and
 need to be addressed. For example; Virgin Games’ main          minimise their negative impacts. You can read all of these
 responsibility is helping to prevent gambling addiction,       in the later chapters.
 Virgin Wines ensures its wine producers get a fair price and

                                                                                                                  n
                                                      d for 40 years. They aren’  t just an image but a reflectio
                                        d  unch ange
                                                                                    value for money, quality,
                       es have rem aine
The Virgin brand valu
                          the way  we  do  busi ness . Virgin has always stood for
of our very essence  and                                                                              gone three
                          a  sen se  of   com pet  itiv  e cha llenge. But now our brand values have
innovation, fun and                                               brand cube to which we have
                                                                                               added the
                                a list of brand values but a
dimensional; we no longer have
Wellbeing &     Happiness of People and
                                     This report
Sustainability of the Planet.
                             evolution to our brand and                    The Brand Cube
represents that fundamental
what we at Virgin stand for.
                                 very of a high quality
We pride ourselves on the deli                                                                          Value for money
                                  the empowerment of our
products and services through                                                                           Good quality
                                of customer feedback to
employees and innovative use                                                                            Brilliant customer service
                                   s experience but can
                                   ’
continually improve the customer                                                                        Innovative
                                idering the impact our
no longer do this without cons                                                                          Completely challenging
                               on people’s wellbeing and
products and services have                                                                              Fun
                                   are intr insically linked.
the planet’s sustainability; they
                                                                                                        Wellbeing & happiness of people
                                                                                                        All stakeholders
    Virgin companies em                                                                                 staff, customers, suppliers, society
                        ploy over 43,000 peo
   20 countries worldw                          ple in over
                         ide. Plus we have a
   10,000 staff emplo                         further
                        yed by partner org                                                              Sustainability of the planet
   deliver a service on                      anisations who
                         Virgin’ s behalf to our cus                                                    Finite resources
   To learn more about                               tomers.
                        our People see page                                                             Low carbon
                                              68.
                                                                                                                                        9
So how does it all fit together?                            style of management, although they all make their
                                                                 own operational decisions. We give birth to new Virgin
     In essence, Virgin is an international investment group     companies, help them develop and set best practice
     with more than 200 companies worldwide. We hold             guidelines for crucial elements such as customer service
     different levels of ownership of the companies: some are    standards, brand management and more recently our
     fully owned by Virgin, we share ownership of others and     vision for Corporate Responsibility and Sustainable
     in some cases the Virgin trademark is carried on ventures   Development1 (CR/SD). Then we keep an eye on them
     which are no longer owned by Virgin at all. Complicated?    as they grow and become fully-fledged members of the
     Well, not really….                                          Virgin family.
     Although managing the Virgin Group is pretty much a full    We may be made up of many companies but we are a
     time job, we have developed a canny way of doing it that    single brand and so it is vital that we remain consistent
     keeps things fresh and lively whatever a company does and   in order to be credible. Although Virgin’s management,
     wherever it’s based. At the centre is Virgin Management     our various Virgin businesses, Richard himself, Unite (our
     which oversees all Virgin companies, providing advisory     charitable foundation) all exist as separate and distinct
     services and managerial support. Our people in London,      entities, combined we can exert a powerful force in the
     New York and Sydney offer regional support and between      areas in which we work. Virgin is a lifestyle brand and
     us and the sector teams we manage Richard’s interests       we now recognise that our responsibility as a consumer
     across the whole of the Virgin Group.                       champion extends to improving our products and services
     As the Virgin businesses are all so diverse and             so that it is easier for our customers to live a sustainable
     independent, we practise a collaborative and supportive     and low carbon life.

                                    TARGET: We will update every
                                    company’s product story by the
                                    end of 2010.                                       The second step:
                                                                                       Dashboard
                                                                                        The detailed Product Story is then
                                                                                       simplified into a succinct Dashboard
       The first step: Product Story process
                                                                                       which highlights the main risks and
       Each Virgin business has its own                                                opportunities, progress made and
                                          Product Story,
      a document that outlines all the                                                 next steps. A traffic light system
                                         corporate
      responsibility and sustainable                                                   measures the level of risk and
                                      development
      (CR/SD) issues that a particula                                                  opportunity of any given issue and
                                       r company faces, put
      together by quizzing our busi                                                    a star system indicates the CR/SD
                                     nesses in depth about
      all the products and services                                                    team’s assessment of how well the
                                     they offer.
      The Product Story covers all aspe                                                company is addressing the issue.
                                          cts of corporate
      responsibility and sustainable                                                   The Dashboard is checked and
                                      development and
      so includes what the business                                                    updated at least twice a year or
                                      is doing well at and
      striving to improve, as well as                                                 more frequently if a company has
                                      the areas which need
      significant work.                                                               a red traffic light against a headline
      Researching and writing the Prod                                                issue. It is completed by Virgin
                                          uct Stories hasn’t
      given us all the solutions, but                                                 Management’s CR/SD team in
                                      by underscoring
     both the good and the bad bits,                                                  collaboration with the company and
                                         we can now say,
     hand on heart, that we know                                                      is then passed onto the company’s
                                     the whole truth (and
     nothing but the truth) and so                                                    MD/CEO and Managing Partner at
                                      are better positioned
     to improve our companies’ impa                                                   Virgin’s management.
                                        cts and help our
     consumers to live more sustaina
                                        ble lifestyles –
     which, is ultimately the aim of
                                      this process.

10
New Economics Foundation – Happy Planet Index 2.0.
                                                                                                  http://www.happyplanetindex.org/learn/why-we-need-hpi.html

     How does this actually work within the                                   what their contribution should be within their sectors and
     Virgin Group?                                                            in comparison to their peers. We want Virgin companies
                                                                              to share their thinking and aim for a common goal so that
     At Virgin Management, it’s the role of the CR/SD team                    we can achieve more, both by supporting one another
     to have an overview of the main trends, risks and                        and also by pushing each sector in a more sustainable
     opportunities of global issues, so that we’re well informed              direction. Rather than taking a top down governance
     and understand how they will affect Virgin businesses (and               approach towards corporate responsibility and sustainable
     of course how we affect them). Armed with this knowledge                 development, we prefer to explain, guide and encourage
     we act as a sounding board for all the businesses. We are                the Virgin companies. In this way, we will ensure they
     also improving our investment and brand criteria so that                 understand that embracing sustainability as a core value
     any new company that joins the Virgin Group will be asked                means acting now on relevant issues which will ultimately
     to adhere to our corporate responsibility and sustainable                be beneficial for their bottom line. We must change the
     development approach.                                                    mindset that running a business in a responsible and
     The aim is to agree a consensus with all our companies on                sustainable way means sacrificing growth and profits.

     1.	You can find a definition of SD on page 8

                                                                                                                                      The S
“
If you were talking to your mates over a beer about your Product                                                                              D Coun
                                                                                                                                      chaire          cil is
Story, would you be proud, or would you be ashamed?”                                                                                         d by V
                                                                                                                                     Group           irgin
                                                                                                                                            ’s CEO
                                                                                                                                     Steph          ,
                                                                                                                                           en Mu
                                                                                                                                    and co        rphy
                                                                                                                                           nsists
                                                                                                                                   senior          of
                                                                                                                                           manag
                                                                                                                                   Virgin        ement,
                              The third step: Risk and Opportunity Register                                                                Unite
                                                                                                                                                 and
                                                                                                 which is discussed               the CR
                              Key headline risks and opportunities are added to a register,                                               /SD te
                                                                                   this meeting   appropriate                                    am.
                              at a quarterly SD Council meeting and following
                              actions are taken .
                                                                                                companies fulfil their
                              These governance steps have been designed to help all our
                                                                               onerous  . They focus on the benefits
                              responsibilities without making the task too
                                                     ibility and sustaina ble develop ment   to the business , for
                              of corporate respons
                                                                                                     and cost
                              example by creating a competitive advantage, ensuring resource
                              efficiency, as well as by managing risk.
                                                                                             new risks are
                               We need to keep listening to our companies to make sure
                                                                                              as possible. We at
                               identified and solutions found and disseminated as quickly
                                                                    in robust science and  sharing our methods of
                               Virgin believe in putting our trust
                                             . We are constan  tly learning and  we will commun  icate our progress
                               best practice
                               to you as we go.

TARGET: We will review and
                               update the risk
and opportunity register eve
                             ry six months.
                                                                                                                                                               11
5    Virgin festiVals
                                                                     with a car-share programme to encourage
What Virgin is up to                                                 festival-goers to car pool
around the World…

                                                                     30,000
                                                                     hours                                     2,000
                                                                     of volunteer time
                                                                     generated at Virgin                       people
                                                                                                               partying to a lady gaga
                          oVer                                       Mobile Festival us
                                                                     2009 (freefest)                           concert in toronto in aid of
                          200 billion                                                                          Virgin Mobile Canada’s
                                                                                                               re*generation campaign
                          steps
                          taken by Virgin HealthMiles
                          members (since 2006)                                                                 20,000
                                                                                                               Virgin mobile limited
                                                                                                               edition re*generation
                                                                                                               samsung phones
                                                                                                               sold to help combat youth
                                                                                                               homelessness

                              110,000
                              mobile           phones
                              reused through Virgin Mobile US’
                              pass it on programme in six months

                                                                                                                      65       house
                                                                                                                      visited each day thanks t
                                                                                                                      on motorbikes provided b
                                                                                                                      businesses and set up b

                             500 plane
                             tickets                                        oVer
                             donated to not-for-profit
                             organisations every year by
                                                                            £250,000
                                                                            donated by Virgin
                             Virgin America
                                                                            Holidays and its
                                                                            customers to the travel
                                                                            foundation and other
                                                                            charities worldwide in
                                                                            2009

                       2   spaceships
                       being built by Virgin Galactic in a
                       spaceport powered by renewable
                       sources

                       300       people                                                                                      30
                       signed up to go on Virgin
                       Galactic flights                              200         groWers
                                                                     that Virgin Wines buys from in
                                                                                                                             preViousl
                                                                     south america                                           disadVan
                                                                                                                             Women
                                                                                                                             working as therap
                                                                                                                             Virgin Spa

                                           160
                                           sustainability                                                                         oVer

                                           audits                                                                                 1,200
                                           completed worldwide at Virgin
                                           Holidays’ partner hotels                                                               ideas
                                                                                                                                  sent in to the
                                                                                                                                  Virgin Earth
                                                                                                                                  Challenge
5,278,389                      £2.6                            52%
                                               tonnes of                      million                         aVerage Waste
                                               co2e                           worth of time, funds and
                                                                              gifts-in-kind donated by
                                                                                                              reduction
                                               Virgin Atlantic’s carbon                                       in Virgin Atlantic’s ground
                                               footprint in 2008              Virgin Atlantic passengers      operation main sites
                                                                              and staff over 2008/2009        (between 2008 and 2009)

2,000
people
partying to a lady gaga
concert in toronto in aid of                                                                               100,000             kWht
                                                                                                           generated by the solar panels on
Virgin Mobile Canada’s
re*generation campaign                                                                                     Virgin Active health clubs in Venice
                                                                                                           (from april 2008 - october 2009)

20,000                                      66 solar                                                       80,000            kWht
                                            panels
Virgin mobile limited                                                                                      generated by the solar panels on
edition re*generation                                                                                      Virgin Active health clubs in brescia
samsung phones                              at kasbah tamadot, a                                           freccia rossa (from may 2008 -
sold to help combat youth                   Virgin Limited Edition                                         september 2009)
homelessness                                property

                                                                                                                                                             21 million
                                                                                                                                                             people
                                                                                                                                                             globally listen to Virgin
                                                                                                                                                             Radio international’s fm
                                                                                                                                                             radio programming

       65       households
       visited each day thanks to health workers                             175       people
       on motorbikes provided by staff at Virgin                             work for businesses run
       businesses and set up by Virgin Unite                                 by young entrepreneurs
                                                                             supported by the branson
                                                                             school of entrepreneurship,
                                                                             set up by Virgin Unite

                                                                                                                                 110
                                                                                                                                 patients
                                                                                                                                 seen every day at the
                                                                                                                                 bhubezi community
                                                                                                                                 healthcare centre set
                                                                                                                                 up by Virgin Unite and
                                                                                                                                 partners and supported
                                                                                                                                 by Virgin Limited Edition

                                    6 caribbean                                                                                                                  72
                                                                                                                                                                 sri lankan
                                    nationals
                                    have gained or are studying for
                                                                                                                                                                 beach sellers
                                    university degrees in tourism
                                    management thanks to Virgin
                                                                                                                         332                                     retrained as tourist
                                                                                                                                                                 guides through Virgin
                                                                                                                                                                 Holidays’ support of the
                                    Holidays scholarships                                                                healthZones,                            travel foundation
                                                                                                                         clinics and
                                                                                                                         biokineticists
                                                                                                                         in the Virgin Life Care network

              30
              preViously                                                                                                                                        3,000
              disadVantaged                                                                                                                                     people
              Women                                                                                                                                             benefiting from the
                                                                                                                                                                three boreholes
              working as therapists at                                                                                                                          installed by
              Virgin Spa
                                                       361       kW
                                                       of solar panels on Virgin
                                                                                                                                                                ulusaba, a Virgin
                                                                                                                                                                Limited Edition
                                                                                                                                                                property
                                                       Active south africa health
                                                       clubs
                                                                                                       515                            12 grey
                                                       90 energy                                       pieces                         Water
                   oVer
                                                                                                       of gym                         recycling
                                                       & Water meters
                   1,200                               in Virgin Active health clubs                   equipment                      systems
                   ideas
                   sent in to the
                                                                                                       donated to charities by
                                                                                                       Virgin Active in 2009
                                                                                                                                      in Virgin Active
                                                                                                                                      health clubs

                   Virgin Earth
                   Challenge
10    companies                                    1 cup
  working in renewable energy and                    recycling
  resource efficiency invested in by
  Virgin Green Fund                                  scheme
                                                     at a V Festival                                          11,000         homes
                                                                                                              powered by the energy saved
                                                                                                              through Virgin Trains’ regenerative
                                                                                                              brakes each year

                                                                                                              400,000
                                                                                                              discounted tickets
                                                                                                              sold each month by Virgin Trains

         35,000                                                      30     people
         runners
         in the london marathon
                                                                     enjoying a relaxing spa
                                                                     treatment everyday with
         sponsored by Virgin
         Money UK
                                                                     Virgin Experience Days
                                                                                                                                                               72
                                                                                                                                                               energy
                                                                                                                                                               meters
                                                                                                                                                               in Virgin Active
                                                                                                                                                               health clubs

                                                                                                                60 marriage
                                                                                                                proposals
                                                                                                                on Virgin Balloon Flights in 2009

                                                                                                                500       jackets
                                                                                                                and bags remade from retired
                                                                                                                Virgin hot air balloons by Worn
                                                                                                                again in 2009

244,681
Virgin books
printed on fsc paper
                                                                                                                             11 ducks &
                                                                                                                             4 flamingos
                                                                                                                             at the roof gardens, a Virgin
                                                                                                                             Limited Edition property

         400
         children                                                                                                                6,000 mobile
         provided with free home                                                                                                 phones
         access to the internet
         by Virgin Media in                200                                                                                   traded in by Virgin Media
                                                                                                                                 customers in 2009
         partnership with the
         e-learning foundation             elderly
         (summer 2008 -
         summer 2010)                      people
                                           in 17 sheltered housing
                                           schemes provided with free

                                                                                                                                       13,000           bottles
                                           internet access by Virgin
                                           Media (2008 - 2011)
                                                                                                                                       of organic wine sold by Virgin Wines
                                           1.6 million                                                                                 every year

                                           set top boxes                                                                               25,000             bottles
                                           and modems                                                                                  of fairtrade wine sold by Virgin Wines
                                           re-used and recycled by                                                                     every year
                                           Virgin Media in 2008

                                                                                          25,000                                                         45,000
                                                                                          people                                                         people
                                                                                                                                                         signed up to
                                                                                          a year zipping past                                            Virgin Games to
                                       4 biodiesel                                        traffic on Virgin                                              play safely online

   1offsetmillion
                                                                                          Limobikes

           Virgin Blue flights
                                       generators
                                       used on the stages at the four
                                       V Festivals in australia
Virgin
TiMELinE…                                                  We’ve done a lot
                                                             the back of 3 pages

                                        1970                                     1971                                             197
  1968
                                                                                                                                 First Virgin
  First issue                                                                     The first Virgin Record Shop opens in          Recording
                                        Start of Virgin
  of Student                                                                      Oxford Street, London                          opens at “
                                        Mail Order
  Magazine                                                                                                                       Manor” ne
                                        operation
                                                                                                                                 Oxford, En

  1991                                                    1992                    Virgin Radio hits
                                                                                  the airwaves on
                                                                                  AM across the UK
                                                                                                        1993                      Virgin Dir
                                                                                                                                  Personal
                                                                                                                                  Financial
                                                                                                                                  Service o
     Virgin Publishing
     (Virgin Books) is                                                                                                            for busine
     formed                                                                                                                       Virgin Cin
                                                                                                                                  and Virgi
                                                                 Virgin                                                           Limobike
                                                                 Records is                                                       launches
                                                                 sold to Thorn                                                    UK. Virgin
                                                                 EMi                                                              launches
                                                                                                                                  in London

                                         2003                                                         Virgin Galactic, Virgin    2005
 2002                                                        Virgin Radio
                                                             goes live in        2004                 Games, and Virgin
                                                                                                      Spa launch. Virgin
                                                             Thailand,
                                                                                                      Unite, the non-profit
                                                             Virgin Credit
                                                                                                      foundation of the Virgin    Virgin M
                                                             Card launches
                                                                                                      group is established.       launches
                                                             in Australia
                                                                                                      Virgin Active launches      Canada.
                                                                                                      its first clubs in italy    Active ex
                                                                                                                                  into Spai
                                                                                                                                  and Port
                                                                                                                                  Virgin Bl
                                                                                                                                  joins with
                                                                                                                                  governm
                                                                                                                                  Samoa t
     Virgin Mobile arrives in the US,                                                                                             ‘Polynes
     Virgin Megastore launches in
     Australia
t.            In fact, we couldn’t possibly fit ev
s -          but here are some of our b

72                                             1973                                                    1984
                    Launch of Virgin
                    Record Label
                    and Virgin Music
                                                             1977               Virgin Records
                                                                                signs the Sex
                    Publishing                                                  Pistols
n
g Studio
“The
ear
ngland

                                                                                                                         1
 rect                  Virgin Trains and
                       V Festival UK start
                                               1996          1997                      Virgin Trains    Virgin Active
 l
opens        1995      up. Virgin Express
                       airline takes off. V2
                                                                                       wins the
                                                                                       15 year
                                                                                       franchise.
                                                                                                        launches its
                                                                                                        health and lifestyle
                                                                                                        centres. Virgin
 ess.                  Music is created
                                                                                       Virgin Radio     Mobile launches
 nemas                 and signs The
                                                                                       in the UK        Virgin’s first
 in                    Stereophonics
                                                                                       is acquired      consumer tele-
es
                                                                                       by ginger        communications
s in the
                                                                                       Productions      venture. Ulusaba
 n Radio
s on FM                                                                                                 is acquired by
n                                                                                                       Virgin Hotels

                                                           2007                                        2008
5                   2006                                            Virgin Media arrives
                                                                    as the UK’s first
                                                                    company to offer TV,
                                                                    broadband, phone
Mobile                                                              and mobile. Virgin
 s in                                                               America takes to
                       Virgin Green Fund and Virgin                 the US domestic
 . Virgin                                                                                                We set up Virgin
                       Life Care are launched. Virgin               skies. Virgin Radio
 xpands                                                                                                  Mobile india.
                       Festival launches in Canada and              italy launches. Al
 in                                                                                                      Virgin Radio in
                       the US, Virgin Money launches                gore joins richard to
 tugal.                                                                                                  the UK becomes
                       in South Africa and Virgin Mobile            announce the Virgin
 lue                                                                                                     Absolute. Virgin
                       launches in France and South                 Earth Challenge.
 h the                                                                                                   Radio launches in
                       Africa. in the UK Virgin Mobile              Virgin Money
ment of                                                                                                  France, Toronto,
                       merges with nTL/Telewest. Virgin             launches in the US
to launch                                                                                                Turkey and Dubai.
                       HealthMiles launches nationally
sian Blue’                                                                                               TV station Virgin
                       across the US
                                                                                                         17 launches in
                                                                                                         France
ly fit everything we’ve done on to
f our best bits…

ds        1984                                         1987                                                   1988
                                  Virgin Atlantic
                                  Airways and
                                  Virgin Cargo                                                                        Virgin Hotels launches
                                  are born and           Virgin Records                                               (Virgin Limited Edition)
                                  a year later           America is
                                  Virgin Holidays        founded and
                                  is formed              Virgin Airship
                                                         & Balloon
                                                         Company
                                                         (Virgin Balloon
                                                         Flights) is
                                                         formed

                                                                                                           2001
                            1999                        2000
 Trains    Virgin Active
he         launches its                                                                                                 Virgin Experience Days
r          health and lifestyle                          Virgin Wines;                                                  launches. Virgin Active
ise.       centres. Virgin                               Virgin Mobile                                                  launches in South Africa.
 Radio     Mobile launches                               Australia and                                                  Virgin Megastore welcomes
UK         Virgin’s first                                Virgin Blue all                                                its first Middle East customers
uired      consumer tele-                                launch
ger        communications
ctions     venture. Ulusaba
           is acquired by
           Virgin Hotels

          2008                      2009                                                                             2010
                                         We partner with Brawn gP for the Formula 1 season and Jenson Button
                                         takes the winner’s podium in his first race. We sell our stakes in Virgin         (so far) Virgin Money
                                         Mobile Canada and Virgin Mobile US but both will continue to carry the            acquires Church House
                                         Virgin brand. Virgin becomes official sponsor of the London Marathon              Trust, our first steps into
                                         and launches Virgin Money Giving. We launch Virgin Digital Help in the            banking, Virgin buys
            We set up Virgin
                                         UK. Virgin Mobile France buys Tele2, its mobile telecom rival. Launch of          into Assura Medical,
            Mobile india.
                                         V Australia with flights between Australia and the US.                            our first entry into the
            Virgin Radio in
                                                               Virgin Radio launches in Jordan, Montreal, Ottawa           UK healthcare market.
            the UK becomes
                                                                and Vancouver. in December we launch our                   We look forward to the
            Absolute. Virgin
                                                                   Formula One team Virgin Racing                          first Virgin sponsored
            Radio launches in
            France, Toronto,                                                                                               London Marathon –
            Turkey and Dubai.                                                                                              so get your running
            TV station Virgin                                                                                              shoes ready…
            17 launches in
            France
Flying
     High                “We all know that
                         aviation has some serious
                         environmental impacts -
     Virgin Atlantic     particularly on our climate.
     Virgin America      Although there’s no prospect
     Virgin Blue         of a 100% sustainable
                         aeroplane taxiing down the
     Brussels Airlines   runway any time soon, that’s
     Air Asia X          not a call for complacency.
                         There’s huge potential to
                         take action now to at least
                         reduce aviation’s impact
                         and increase the chance
                         that, one day, it might
                         approach sustainability. I’m
                         encouraged that Virgin is
                         both being frank about the
                         problems - and engaged
                         with the solutions.”
                         Martin Wright
                         Editor in Chief at Green Futures

16
Modern aviation has changed the way we live,                        recognises its environmental impacts and is            Aviation’s global
 making the world a much smaller place. We                           working to minimise them while maintaining and       economic impact* is
 now have a greater understanding of other                           enhancing the benefits it can bring to economies     estimated to be 7.5% of
 civilisations and in many cases our cultures have                   and societies3. The industry’s first step towards    world GDP.
 started to merge. Air travel is much faster and                     a carbon-free future is to work towards carbon       *direct, indirect, induced and
                                                                                                                          catalytic
 more reliable than other modes of transport over                    neutral growth – meaning that any growth above
                                                                                                                          Source: Air Transport Action
 large distances1. Travelling is now a reality and                   the baseline will be matched by equivalent           Group. Air transport drives eco-
                                                                                                                          nomic and social progress. The
 an achievable goal for many people who could                        reductions in other sectors.                         economic and social benefits
 never have afforded it before. We are proud to                                                                           of air transport 2008. (http://
                                                                     Aviation represents by far the biggest               www.atag.org/files/ATAG%20
 have been in aviation for 26 years and believe in                                                                        brochure-124015A.pdf)
                                                                     environmental impact of all the Virgin businesses.
 a sustainable future for the industry.
                                                                     Climate change is therefore top of the agenda
 We believe in the positive contribution global                      for both the Virgin Group and Virgin branded
 travel makes to the world. Flying is crucial to the                 airlines and we are committed to preventing
                                                                                                                             As the Virgin Group
 global economy and central to many people’s                         runaway climate change . We won’t hide from
                                                                                                                          owns a stake in many
 lifestyles – it links families, communities and                     the difficult arguments surrounding aviation and
                                                                                                                          airlines around the
 businesses resulting in vibrant and successful                      the environment, in fact, we want to be right at
                                                                                                                          world, it is now possible
 cultures and economies .                                            their heart, pushing our industry, our suppliers,
                                                                                                                          to circumnavigate the
                                                                     and our regulators to be bolder and to help
 Aviation also has negative impacts. It produces                                                                          world on a Virgin plane.
                                                                     make flying a more sustainable way to travel. Air
 a significant contribution to man-made carbon                                                                            We own stakes in eight
                                                                     travel is not about to disappear, particularly in
 dioxide (CO2) emissions . It is central to the                                                                           airlines, Virgin Atlantic,
                                                                     the developing world. Airlines, such as Air Asia X
 climate change debate as it is one of the fastest                                                                        Virgin America, Brussels
                                                                     (part owned by Virgin) are growing rapidly and
 growing contributors of greenhouse gases                                                                                 Airlines, Air Asia X and
                                                                     giving more and more people and businesses
 (GHGs) and is forecasted to continue growing                                                                             the Virgin Blue Airlines
                                                                     access to an increasing number of destinations
 for the next thirty years2 . The aviation industry                                                                       Group (Virgin Blue, V
                                                                     and markets.
                                                                                                                          Australia, Pacific Blue
                                                                                                                          and Polynesian Blue) as
                                                                                                                          well as being involved
                                                                                                                          with private planes.

                                              Global CO2 emissions from
                                              aviation are equivalent to about
                                              1.9 - 2.4%
                                              of total global CO2 emissions
                                              Source: Committee on Climate Change. International Aviation                 1.   Oxford Exonomics. Avia-
                                                                                                                               tion: The Real World Wide
                                                                                                                               Web (http://www.oef.com/
                                                                                                                               OE_Cons_Aviation.asp)
                                                                                                                          2.   Friends of the Earth (May
                                                                                                                               2005) Briefing: Aviation
                                                                                                                               and the economy (http://
                                                                                                                               www.foe.co.uk/resource/
                                                                                                                               briefings/aviation_and_the_
                                                                                                                               economy.pdf)
                                                                                                                          3.   Air Transport Action Group.
                                                                                                                               Air transport drives eco-
                                                                                                                               nomic and social progress.
The amount of CO2 emissions from                                                                                               The economic and social
                                                                                                                               benefits of air transport

  aviation is expected to grow by                                                                                              2008. (http://www.atag.org/
                                                                                                                               files/ATAG%20brochure-
                                                                                                                               124015A.pdf)
            around 3-4% per year.                                                                                         4.   “Virgin Airlines” refers to
  Source: International Civil Aviation Organisation, Environnent Section.                                                      all airlines owned by Virgin
                                http://www.icao.int/icao/en/env/aee.htm                                                        or branded with the Virgin

                                                                                           CO2
                                                                                                                               name.

                                                                                                                                                       17
Aviation accounts for 7
                                                                out of the 8 million tonnes
                                                                of CO2 emissions emitted
                                                                annually by the Virgin Group.

        We at Virgin believe that the Virgin airlines4 can      Industry Taskforce on Peak Oil & Energy                      The UK Industry
        have a positive influence on this movement.             Security                                                 Taskforce on Peak Oil
        Although we represent a small part of the                                                                        and Energy Security
                                                              • Virgin Blue was the first airline to offer an
        aviation industry we have a high profile and                                                                     (ITPOES) is a group
                                                                airline run offset programme
        a loud voice, which we are using to push the                                                                     of British companies
        debate forwards. That is why:                         • Virgin America was the first commercial                  concerned that threats
                                                                passenger airline to join the US Environmental           to energy security
        • we were the first carriers to call for global
                                                                Protection Agency’s Climate Leaders                      are not receiving the
          legislation on airline CO2 emissions
                                                                programme, and the first US airline                      attention they merit.
        • Virgin Atlantic was the first to fly on renewable     to document its carbon footprint via                     It has produced two
          fuels                                                 internationally-accepted standards on The                reports that can be read
                                                                Climate Registry                                         at: peakoiltaskforce.net
        • Virgin Atlantic was a founding member of
          the Aviation Global Deal Group5 and the             • we have produced a paper “Aviation in a Low
                                                                                                                         5   Aviation Global Deal Group
          Sustainable Aviation Fuel Users Group6                Carbon World” which outlines our thoughts on                 (www.agdgroup.org)
                                                                                                                         6   Sustainable Aviation
                                                                the subject. To read the report visit                        Fuel Users Group
        • the Virgin Group participates in the UK
                                                                http://www.virgin.com/people-and-planet.                     (www.safug.org)

     Virgin Blue’s carbon offset launch
     2007.                                                                                     The milestone of one
                                                                                               million guest seats
     Holding the globe is (from left
                                                                                               offset was reached in
     to right) Malcolm Turnbull (the
                                                                                               July 2009.
     Australian Environment Minister
     in 2007) and Brett Godfrey (CEO
     Virgin Blue)

                                                                                  Virgin Blue passenger who offset the
                                                                                  millionth seat receiving a memento
                                                                                  from Professor Tim Flannery.

18
Virgin America’s fleet
                                         Here is what our companies are doing to                                                                        has a lower carbon
                                                                                                                                                        footprint than other US
                                         make flying high more sustainable:                                                                             airlines due to its upfront
                                                                                                                                                        investment in new
                                                                                                                                                        aeroplanes and its fuel-
                                                                                                                                                        saving practices.

                                         Emissions                                                  The Virgin airlines believe that a successful
                                                                                                                                                           Gold Standard
                                                                                                    global climate change framework for the industry
                                         Carbon Dioxide emissions from aviation                     should be based on the following key principles:    offsetting makes sure
                                         represent over 90% of the Virgin Group’s entire                                                                that the money goes
                                         carbon footprint making it our top priority.               • first and foremost, any system needs to be
                                                                                                                                                        directly to a project
                                         The Virgin branded airlines are committed to                 environmentally effective. It must impose a
                                                                                                                                                        which has immediate
                                         reducing emissions per passenger through a                   robust cap on overall emissions and truly allow
                                                                                                                                                        positive impacts, both in
                                         number of efficiency measures including the                  aviation to play its part in meeting global
                                                                                                                                                        the local communities
                                         adoption of new technologies and by investing in             greenhouse gas reduction targets
                                                                                                                                                        and the environment.
                                         new ultra-efficient aircraft.
                                                                                                    • it must be mandatory, applying fairly to
                                                     gnikraP
ippots oN               gnirud gnippots Airlines
                                        oN       have
                                                   ot detctwo        of CO2 emissions:
                                                           irtser sources                             all airlines based on their emissions and
  semit                  detacidni doirep         sredloh timrep
                                                                                                      establishing a sectoral approach that sets out       The members of the
  f tpecxe               sesub rof tpecxthose
                                        e      from the tailpipe of  the aeroplane7 and
                                                                       selcihev oN                                                                        AGD are:
 secen sa                                those from the ground facilities.
                                                                     mumixam rAs evo the tailpipe     specific targets for aviation whilst allowing
ro nwod
                                                                      thgiew ssorg
                                                                                                                                                        • Air France-KLM
essap                                    emissions account for around        99%    of the total,     airlines to access cost effective emissions
                                                                          nwohs                                                                         • British Airways
                                         that is where the airlines’ main
                                                                        )sennofocus
                                                                              t ni(   lies:           reductions from other sectors through the         • Cathay Pacific
                                                                                                      carbon markets                                    • Finnair
                           gnippots oN     gnitiawhas
                                 • Virgin Blue     oN already achieved a 10%
                            )yawraelC(
                                                                                                    • it needs to minimise the risk of competitive
                                                                                                                                                        • Qatar Airways
                                   decrease in emissions per passenger on board8
                                                                                                                                                        • Virgin Atlantic
                                   due to investment in new aircraft9                                 distortion
                                                                                                                                                        • Virgin Blue Airlines
                   evig yltsom redrob der on tub selcric eulb htiw sngiS
                                 • Virgin Atlantic has                                              • it needs to avoid unintended negative               Group
                                                      .noitset
                                                           curtasntarget   ofp reducing the
                                                                   i evitiso
                                   carbon emitted per passenger kilometre by                          consequences such as carbon leakage13, whilst     • BAA
                                                                                                      upholding the central pillar of the UNFCCC14,     • LOT Polish Airlines
                                   30% between 2007 and 2020
                                                                                                                                                        • The Climate Group
                                                                                                      of “common but differentiated responsibility”
                                       • Virgin America operates a fleet that is up to                - where developed countries bear a greater
                                           25% more fuel efficient than other fleets in the           burden of responsibility for emissions
lciheV              tfel peeK           tfel nruT        daeha tfel nruT  ylno daehA
ssap             lobmys fi thgir(    lobmyUSs fi thgi.r( lobmys fi thgir(
                                                                                                                                                           The AGD proposal
 t edis             )desrever            )desrever            )desrever
                                                                                                      reductions as they have benefited from carbon     suggests a carbon
                  em
                   issions
as
                 reduction               Our major airlines also offer Gold Standard for              intensive industries for much longer than         cap and trade system
itsed
                                         their carbon offsetting:                                     developing economies.                             that would include all
                                                                                                                                                        airlines. A CO2 cap
                                         • Virgin Atlantic = My Climate10                           Virgin Blue and Virgin Atlantic are members
                                                                                                                                                        or target would be
                                                                                                    of the Aviation Global Deal Group (AGD              established, creating
                                         • Virgin Blue = Australian Government’s                    Group), a group that came together to think         a number of carbon
                                      detaGreenhouse    eb Friendly™ Program            11
 fo dnE      deeps muminiM                  gergeS         ot etuoR  tuobadnuor-iniM                about practical solutions for how aviation
ps                                    elcyc ladep     ladep yb desu     tuobadnuor(                                                                     allowances for aviation.
                                     nairtsedep dna
                                       • eVirgin        ylno selcyc  evig - noitalucric12
                                                    America = Carbonfund.org             .          emissions could be included in such a               A proportion of those
                                            tuor                      selcihev ot yaw
                                                                          eht morf                  framework . The AGD Group’s policy                  allowances would be
                                       Although all the Virgin airlines
                                                                     )thgir etaare
                                                                               idemmworking
                                                                                      hard
                                                                                       i            mechanism, which we have proposed as one            auctioned to airlines,
                                         to reduce the emissions per passenger, total               of the ways in which aviation can be brought        with the revenues being
                                         emissions will continue to grow in the short to            into a global framework, recommends that this       hypothecated for climate
                                         medium term in line with business growth. Virgin           common but differentiated responsibility is
                                                                                                                                                        change related projects
                                         Atlantic predicts that its emissions will peak                                                                 in the developing world.
                                                                                                    achieved by distributing revenues generated by a
                                         within the next decade owing to efficiency gains                                                               You can get more
fart yaw-enO                nairtsedeP                                                              sector-wide cap and trade scheme . We believe
apmoc :eton(                 gnissorc                                                                                                                   information on the AGD
                                         outstripping the airline’s growth.                         a proportion of aviation’s carbon allowances
 ehA‘ ralucric              revo tniop               ylno smarT           dna sesuB                                                                     website:
 )ngis ’ylno                 yawmart                                                                should be auctioned, with the proceeds going to
                                                                          ylno selcyc                                                                   www.agdgroup.org
                                                                                                    climate change related projects in the developing
                                                                                                    world.

                                         Global Policy                                              The Virgin airlines support the principle of        7	This included the APU
                                                                                                                                                            emissions (APU = Auxiliary
                                       We believe it is critical for governments to                 carbon cap and trade as the most effective way          Power Unit generates
al elcyc ladep wolf-htiW            enal sub wolf-artnoC   dna sub wolf-htiW                        of maintaining a robust cap on CO2 emissions            electricity when the plane is
                                       agree a global framework         for CO2 emissions
                                                               enal elcyc                                                                                   on the ground).
                                       reductions from aviation; a framework that is                whilst also allowing the market to decide the       8   Measured in revenue
                                                                                                                                                            passenger / kilometre (an
                                       both environmentally effective and economically              most effective way to achieve the necessary             industry measure related to
                                                                                                    emissions reductions.                                   the number of passengers
                                       efficient .                                                                                                          carried divided by the total
                                                                                                                                                            number of kilometres flown)
                                         Emissions from international aviation are not              However, there is a concern that domestic or        9   Since commencing
                                                                                                                                                            operations in 2000
                                         currently included in the Kyoto Protocol but the           regional schemes cannot be truly effective for an
                                                                                                                                                        10. My Climate
                                         Virgin airlines, along with their industry peers,          international industry such as aviation. It would       (www.myclimate.org)
                                                                                                                                                        11. Australian Government’s
                                         have united behind the principle of a global               make sense to develop a global scheme for the           Greenhouse Friendly™ Pro-

                                         framework specifically for the sector.                     sector, thus minimising competitive inequalities        gram (www.climatechange.
                                                                                                                                                            gov.au/greenhousefriendly/)
                                                                                                    between different carriers and imposing a           12. Carbonfund.org (www.
                                                                                                                                                            carbonfund.org)
                                                                                                    much more meaningful absolute cap on carbon         13. For a definition of carbon
                                                                                                    emissions worldwide.                                    leakage go to page 21.
                                                                                                                                                        14.	United Nations Framework
                                                                                                                                                            Convention on Climate
                                                                                                                                                            Change

                                                                                                                                                                                   19
Peak Oil is the point
                                                                                                               at which the depletion
                                                                                                               of existing reserves can
                                                                                                               no longer be replaced
                                                                                                               by additions of new flow
                                                                                                               capacity - in other words
                                                                                                               it is the point at which
                                                                                                               the world peaks in oil
                                                                                                               production. Up until
                                                                                                               now we have always
                                                                                                               had more oil to use
                                                                                                               than there was in the
                                                                                                               previous year. However
                                                                                                               as oil is a finite resource
                                                                                                               this cannot continue
                                                                                                               indefinitely. Once oil
                                                                                                               production peaks the
                                                                                                               world will have to start
                                                                                                               to use less oil each year
                                                                                                               due to dwindling supply
                                                                                                               which will lead to an
                                                                                     Virgin Atlantic biofuel   increase in the price
                                                                                     demonstration flight      of oil.
                                                                                                               Source: The UK Industry
                                                                                                               Taskforce on Peak Oil & Energy
                                                                                                               Security. The Oil Crunch: Secur-
                                                                                                               ing the UK’s energy future. (This
                                                                                                               report was part funded by the
                                                                                                               Virgin Group).

                                                                                                                  This innovative
     Fuels                                                overcome, biofuels are not yet being produced        study brings together
                                                          on a viable scale, although this emerging sector     airlines, defence and
     The era of ‘cheap oil’ is coming to a close and      is growing fast.                                     research organisations,
     peak oil is fast approaching as extraction and
                                                                                                               governments and fuel
     refining become increasingly difficult and more      Second and third generation biofuels do not use
                                                                                                               providers to identify
     environmentally damaging and energy intensive.       food products as their feedstocks. These biofuels
                                                                                                               opportunities and
     Oil is a finite resource and technological           would be made from waste biomass or plants
                                                                                                               barriers to achieving
     advancements can only go so far. We need             such as algae and salt water tolerant halophytes
                                                                                                               a predetermined
     to look for alternative aviation fuels, not only     and could be commercially viable in sufficient
                                                                                                               sustainable fuel mix by
     because of the urgency arising from climate          quantities for the aviation industry to use within
                                                                                                               2025. (An Australasian
     change, but simply because we are running            the next five years. Virgin Atlantic anticipates
                                                                                                               Region SAFUG Initiative).
     out . Along with other stakeholders, the Virgin      that up to 5% of its fuel will come from
     airlines are championing the development of          sustainable biofuels by 2015 and Virgin Atlantic
     fuels based on second generation biofuels that       along with Virgin Blue and Virgin America aspire
     are harvested from sustainable sources in order      to a 10% biofuels mix by 2020.
     to reduce the sector’s dependence on declining
                                                          What Virgin is doing with regards to biofuels:
     oil supplies and reduce its carbon footprint.
                                                          • Virgin Atlantic was the first commercial airline
     However, the sustainability debate surrounding
                                                            to use biofuel in a demonstration flight
     biofuels is extremely complex and biofuel
     production has been associated with a swathe         • the Virgin Group, through the Virgin Green
     of unintended consequences including; the              Fund, is investing in research and development
     link between biofuel production and increases          of emerging fuels (for more information on the
     in food prices, the loss of natural habitats and       Virgin Green Fund go to page 49)
     the fact that many are so fossil fuel intensive in
                                                          • Virgin supports the Roundtable on Sustainable
     their production, that they may have no carbon
                                                            Biofuels
     benefit at all! Although many biofuels have been
     made unsustainably and inefficiently in the past,    • Virgin Atlantic was a founder member of
     we believe they have the potential to become           the Sustainable Aviation Fuel Users Group15
     sustainable and efficient in the future.               (SAFUG)

     Any large scale move towards biofuels would          • Virgin Blue under the SAFUG banner, is
     occur incrementally over time. Blends of biofuel       working with other regional members
     and conventional kerosene would be introduced,         to commission a roadmap for the
     and then over time the proportion of biofuel will      commercialisation of sustainable aviation fuels
     be increased. However, even with low percentage        in Australia and New Zealand .
     blends, the sheer quantities of biomass required                                                          15.   http://www.boeing.com/
                                                                                                                     commercial/environment/
     to produce sufficient fuel for aviation would                                                                   pdf/sustainable_aviation_
     be colossal. Even with the sustainability issues                                                                fuel_users_group.pdf

20
What is
                                                                                               Carbon
                                                                                               Leakage?
What is Emissions Trading?                                                                     Carbon Leakage is where
                                                                                               an increase in emissions
                                                                                               occurs outside a region due

 Emission Trading Scheme (ETS) means that a robust cap is imposed on
                                                                                               to a policy to cap emissions
                                                                                               in that region. With the
 carbon dioxide emissions from different polluting industries. Carbon                          inclusion of aviation within

 allowances are issued to participating companies up to the level of
                                                                                               the European Union Emission
                                                                                               Trading Scheme (EU-ETS)
 the cap. At the end of the year each company has to have sufficient                           there is a risk that carriers
                                                                                               will move activities outside
 allowances to cover each tonne of CO2 they’ve emitted during the year.                        the EU to avoid the EU-ETS
 Because the ETS is designed to encourage lower carbon behaviour by                            costs or that increased costs
                                                                                               will lead to loss of market
 companies, airlines won’t be given sufficient allowances to cover their                       share with demand shifting
 activities and will have to purchase these from other industries who have
                                                                                               to non EU-ETS affected
                                                                                               carriers. This would result
 been able to reduce their emissions more quickly. The European Union                          in no overall reduction in

  Emission Trading Scheme is going to include aviation and will come into
                                                                                               global carbon emissions as
                                                                                               the emissions would simply
  effect in 2012.                                                                              be shifted to other markets
                                                                                               and regions. This is one of
                                                                                               the reasons why we support
                                                                                               a global sectoral approach
                                                                                               for aviation and believe a
                                                                                               worldwide solution is needed
                                                                                               for what is a worldwide
                                                                                               problem.

   The Sustainable Aviation Fuel Users
   Group is an initiative to promote
   sustainable, second-generation biofuels
   for the aviation industry.
   Virgin Atlantic made a declaration, along with
   other airlines, of its commitment to advance the
   development, certification, and commercial use
   of drop-in sustainable aviation fuels that do not
   compete with food cultivation for land or water.
   These have lower life-cycle carbon footprints than
   traditional jet fuel, do not lead to deforestation
   or the loss of high value, endangered or sensitive
   ecosystems and retain socioeconomic benefits in the
   communities in which they are cultivated.

   (www.safug.org)

                                                                  On 24 February 20
                                                                                       08, Virgin Atlantic
                                  ls                                                                         became
 Roundtable on Sustainable Biofue
                                                                  the first airlin
                                                                                      e in the world to
                                                                 operate a commercial
                                          body which is                                 aircraft on a biofu
 is an international multi-stakeholder                           The Boeing 747 fle                         el blend.
                                           ls to make it                              w a short flight fr
 creating standards and audit protoco                            London to Amsterdam                       om
                                         party certification                            , using a 20% biofu
 possible through independent third                              kerosene blend in one
                                                                                         of its four engines.
                                                                                                             el/80%
                                             ainable
  to identify biofuels that come from sust
                                          ures that new         The purpose of the
  sources. Third party certification ens                                              demonstration fligh
                                                                                                           t was
                                            mental and          to move the deba
  supply chains develop to high environ                         that biofuels are tec
                                                                                       te forward by proving
                                              ut competition
   social standards, so that concerns abo                       Virgin Atlantic knew
                                                                                      hnically a feasible
                                                                                                          solution.
                                            ation and
   with land for food cultivation, deforest
                                                                                       that the biofuel used
                                                               its test flight would                           for
                                              be addressed
   relative life-cycle carbon footprints can
                                                                                       not be commercially
                                                               for the industry, bu                         via ble
                                           on the RSB on                              t wanted to demons
   and reconciled early on (read more                          that biofuels coul                         tra te
                                               b.org).                                d be a future solution
   page 37 or on their website at: www.rs                      for the industry.

                                                                                                                      21
30% reducti
                                                                                                                                                  on

                                                     target:
                                    Virgin Atlantic       e carbon intensi
                                                                           ty
                                    A 30% reduction in th
                                                se n g er an d ca rgo kilometre
                                    of each pas                         .
                                                     2007 and 2020
                                    flown between

                Operational efficiencies                                             • Virgin Blue has a Fuel and Emissions Management
                                                                                       Team that examines every aspect of flight operations
             All airlines need to invest in modern fleets that operate                 to continuously improve efficiency. Recent initiatives
             as efficiently as possible and are backed up by low                       include installing winglets on the 737NG fleet as well as
             carbon ground support systems . But airlines are only                     applying a coating to the aircraft that reduces drag and
             one of the many stakeholders in the aviation industry                     therefore emissions

orders
             and so it’s fundamental that the entire sector works
             together. The speed at which the aviation industry can                  • Virgin America utilises advanced avionics to fly more

                       hibitive. step changes in aircraft and engine
             reduce its emissions    is mainly reliant on manufacturers to             efficiently, and cost index flying which is the practice of
             y protechnological
 are mostldeliver                                                                      regulating cruising speeds to reduce fuel burn
              messthe       e.
                        agavailability
ualify their also
             design,                    of sustainable low carbon fuels and
                                                                                     • Virgin Atlantic’s Fuel and Weight Savings Group
                  improved air traffic control measures to ensure more
                                                                                       champions new best practice and efficiency measures .
             efficient use of airspace.

                                                                                     Since aviation can have a impact on communities that are
                What the Virgin airlines are doing on energy efficiency:
                                                                                     local to airports, our airlines have initiatives at airports
                • developing and implementing operational best practices             around the world which directly benefit local communities.
                                                                       ng
                  to reduce CO2 and NOx       l speed
                                            emissions   School crossi                For example:
                                      ationa
                                         16
                                       N                            patrol
                   Maximum              limit applies
                • lobbying                                                           • the total noise output of Virgin Atlantic’s fleet has been
                     speed governments and air navigation service
                  providers for more efficient airspace routings                       reduced since 2001/2 despite an increase in fleet size

 nd of          • utilising a young, advanced fleet of fuel efficient aircraft       • improving the availability and reliability of electricity
mph zone                                                                               supply for ground operations at airports around the
                                                                                       world will reduce emissions and improve local air quality

                                                                                     • Virgin Blue has invested in a young fleet of aircraft which
                                                                                       has a reduced noise footprint.

                                                                   No entry for
                                                                                     16.   Nitrous Oxide

                                                  ry
                                    ated tempora                  vehicular tra ffi c
                      Manually oper       si gn s
ive way to               STOP and     G O
traffic on        Virgin Atlantic
major road                        target:
                 To reduce ener
                                  gy consumption
                at all the UK s
                                 ites that it
                controls by 10%                           No                                                                reduced noi
                         ot or
                                  Nby
                                    o bu20ses 12
                                                 an d ov er taking
                                                                                                                                        se footprint
                      om
                20% Nby             (o ve r8
 No cycling                2020.
                     vehicles                   passenger
                                                  seats)

         22
Working with communities                             Sustainable tourism                                     There are now five
                                                                                                           holiday flights to every
Each year, Virgin Atlantic, Virgin Unite and         Aviation has played a key role in expanding
                                                                                                           business flight made
Virgin Holidays, along with the support of their     tourism, which has in turn boosted air travel.
                                                                                                           overseas by a UK
passengers and staff, collectively invest millions   Over 40% of international tourists now travel by
                                                                                                           resident.
of pounds in community projects within the           plane17 and in the UK growth in air travel is being   Source: Cairns, S., Newson, C.,
destinations they travel to and work in. Under       driven by an increase in international leisure        Boardman, B. and Anable, J.
                                                                                                           Predict and decide Aviation,
the Change is in the Air programme, Virgin           flights18 .                                           climate change and UK policy.
                                                                                                           Environmental Change Institute
Atlantic and its passengers will be supporting                                                             Oxford University.
                                                     Tourism can be a catalyst for positive social
two organisations, The Travel Foundation and
                                                     and economic development, but it is becoming
Free the Children, which both work towards
                                                     increasingly evident that some aspects of
sustainable futures for young people in its                                                                   Air tourism accounts
                                                     tourism are currently unsustainable . The Virgin
destinations.                                                                                              for 8 million direct jobs
                                                     airlines, along with Virgin Holidays and Virgin
                                                                                                           and 18 million indirect
Virgin Blue’s “Red Jet” charity foundation is        Limited Edition, are working towards gaining
                                                                                                           jobs as well as $396
currently focusing on “Indigenous Communities        a greater understand of their impacts and
                                                                                                           billion US in global GDP.
and Natural Environments” in Australia. The          promoting sustainable tourism. To find out more       Source: Oxford Exonomics.
foundation has provided assistance to several        go to ‘We’re all going on a Summer Holiday’ on        Aviation: The Real World Wide
                                                                                                           Web
projects including a residential energy efficiency   page 24.
programme in Alice Springs and a savannah fire
management project in Arnhem Land.

Virgin America works with the California State
Parks Foundation and selects California-based
carbon offset projects via its partnership with
Carbonfund.org. Virgin America also hosts
                                                                                                           17.   Air Transport Action Group.
regular e-waste collection events to clean-up                                                                    Air transport drives eco-
                                                                                                                 nomic and social progress.
local beaches and parks.                                                                                         The economic and social
                                                                                                                 benefits of air transport
                                                                                                                 2008. (http://www.atag.org/
                                                                                                                 files/ATAG%20brochure-
                                                                                                                 124015A.pdf)
                                                                                                           18.   Cairns, S., Newson, C.,
                                                                                                                 Boardman, B. and Anable,
                                                                                                                 J. Predict and decide Avia-
                                                                                                                 tion, climate change and
                                                                                                                 UK policy. Environmental
                                                                                                                 Change Institute Oxford
                                                                                                                 University.

                                                                                                                                       23
WE’RE ALL                  Information signs - continued

     GOING ON                                             Hospital ahead with              Tourist
                                                                                                                    No thro
                                                                                                                      for v

     A SUMMER
                                                            Accident and                information
                                                          Emergency facilities              point
                              Traffic has priority over
                                oncoming vehicles

     HOLIDAY
                                                                                       Area in which
                                                                                        cameras are               Bus lane
                                                                                      used to enforce               junctio
                              Recommended route           Home Zone Entry
                                for pedal cycles                                     traffic regulations

                                Road works signs
     Virgin Holidays
     Virgin Limited Edition
                                                                                 Temporary hazard
                                   Road works              Loose                                              Temporary lane
                                                                                   at road works
                                                          chippings                                         (the number and
                                                                                                              of arrows and
                                                                                                            may be varied a
                                                                                                           to lanes open an

                                   Slow-moving or         Mandatory
                                                                                   Road works               End of road w
                                   stationary works          speed
                                                                                   1 mile ahead            any temporary r
                                  vehicle blocking a      limit ahead
                                                                                                             including spe
                                 traffic lane. Pass in
                                the direction shown
                                     by the arrow.
24
Information signs
                                                                                                                                               All rectangular

                                                                                                                                                                                                                         End of controlled
                                                                                                                                                                                                                           parking zone
                                                                                                                                                     Entrance to
                                                                                                                                                                           Entrance to congestion
                                                                                                                                                      controlled
                                                                                                                                                                               charging zone
                                                                                                                                                    parking zone
                                                                                                                                                                                               “Susta
                                                                                                                                                                                                         in
                                                                                                                                                                                              is tou able touris
                                                                                                                                                                                                      rism th            m
                                                                                                                                                                                             the m              at lea
                                                                                                                                                                                                      anag             ds to
                                                                                                                                                                                           resou              em
                                                                                                                                                                                                    rces in ent of all
                                                                                                                                                                                          that e               such
                                                                                                                                                                                                   co                 a way
                                                                                                                                                                                         and a nomic, soc
                                                                                                                                                                                                  esthe              ial
                                                                                                                                                                                       cabus
                                                                                                                                                                                           n belane        tic n
                                                                                                                                                                            With-flow
                                                                                                                                                                                                   fulfille eedLane  s designated
                                                                                                                                                                               ahead mawhichintain           d whil for use by high
                                                                                                                                                                                                    in              e
                                                                                                                                                  Parking place for
                                                                                                                                                                                        tegrityand g cultural occupancy
                                                                                                                                                                             pedalincycles
                                                                                                                                                  solo motorcycles          taxis may also       , esse
                                                                                                                                                                                   ecolo use              ntial vehicles (HOV) -
                                                                                                                                                                                             gic                       see rule 142
                                                                                                                                                                                  biolog al process
                                                                                                                                                                                             ical d              es,
                                                                                                                                                                                life su              iv ersity
                                                                                                                                                                                           pport                a
                                                                                                                                                                               Sourc                system nd
                                                                                                                                                                              (ww    e : W
                                                                                                                                                                                   w.un orld Tou
                                                                                                                                                                                                               s”.
                                                                                                                                                                                      wto.o        rism
                                                                                                                                                                                           rg)            Orga
                                                                                                                                                                                                              nizati
                                                                                                                                                                                                                    on

                                                                                                                                                                                       Start of motorway
                                                                                                                                                                                         and point from
                                                                                                                                                      End of                            which motorway                                   Ap
                                                                                                                                                     motorway                          regulations apply
                                                  Holidays are great for recharging our batteries and
                                                  allowing us to relax both mentally and physically.
prohibitive.                                      Travelling is also a great way to expand our horizons
 essage.
                                                  and the growth of the travel industry in recent years
                                                                                                  Traffic on the main                                                              Additional traffic joining from left
                                                  has been invaluable in increasing our understanding
                                                                                                 carriageway comingof                                                             ahead. Traffic on main carriageway
                                                                                                                                                                                  has priorityTourism   leads
                                                              g
                                             School crossin
                     National speed                                                             from right has priority                                                                        over joining  traffic from
                                                  other cultures and customs.
Maximum                                          patrol
                      limit applies                                                               over joining traffic                                                               righttohand
                                                                                                                                                                                              a wide
                                                                                                                                                                                                  lanerange
                                                                                                                                                                                                        of slip of
                                                                                                                                                                                                                road
 speed
                                                                                                                                                                                      potential employment
                                                                                                                                                                                      opportunities by
                                                  In the introduction we talked about how                          there were 565 million international tourist                       generating jobs across
                                                  important it is that our vision of a low carbon                  journeys made and that figure is forecast to grow                  a whole range of skills
                                                  lifestyle
                                                  No entry for
                                                                    in the future is desirable and free from       to over 1.6 billion by 20204.                                      and occupations. Many
                   d temporary                       icular traffic
   Manually operate signs                         sacrifice.
                                                 veh                 Holidays represent happy times in our                                                                            of the jobs in tourism
      STOP and GO                                                                                                  With such massive growth comes huge
                                                  lives but the travel and tourism industry, like                                                                                     attract younger workers
                                                                                                                   challenges; overdevelopment,      over-reliance
                                                                                                                                              ‘Countdown’   markers atonexit from motorway (each bar
                                                  many others, makes both positive and negative                                                                                       who might otherwise
                                                                                                                   tourism for economic growth      in developing
                                                                                                                                             represents  100 yards to the exit). Green-backed markers
                                                  contributions in the wider world. At Virgin, we                                           may  be  used on primary routes   and     emigratemarkers
                                                                                                                                                                                  white-backed  in search of
                                                          No                                                       countries, an ever increasing carbon footprint,
                              No buses            describe
                                                      overtaking
                                                                     sustainable tourism as ‘when locals                                                                              employment.
                                                                                                                                                 with black bars on other routes. At approaches  to
     No motor                  (over 8                                                                             depletion of destinations’ natural resources and
      vehicles                passenger           benefit as much as visitors and where the resorts                                          concealed level crossings white-backed Source:
                                                                                                                                                                                     markers    withThe
                                                                                                                                                                                            Aviation: redReal World
                                seats)                                                                             damage to land and ocean bars based
                                                                                                                                                 may be ecosystems.
                                                                                                                                                                                    Wide Web. Oxford Economics.
                                                                                                                                                         used. Although these will be erected at equal
                                                  we enjoy today are preserved for others to enjoy                                                                                                                                       Mo
                                                                                                                   The challenges facing thedistances   the bars doare
                                                                                                                                               tourist industry     not represent 100 yard intervals.                                   show
                                                  in the future’ .
                                                                                                                   enormous and cover many different and complex
                                                  Travel and tourism is the world’s largest industry               issues that are hard to unpick. It is therefore                     Globally, tourism
                                                  andNoavehcritical
                                                            icles         component of the global economy,         critical to ensure that our travel and tourism                   directly 112
                                                                                                                                                                                               employs 79
                               No vehicles
      No vehicle or
                                                         over
                                                  fuelling                                                                                                                          million people and
                                                     width shogrowth         and employment . It represents        related businesses are doing their best to
                                   over                        wn
     combination of            height shown
      vehicles over                               10% of global GDP1 and 8% of employment                          address these challenges.                                        in total supports 226
      length shown
                                                  worldwide2 . It also encourages development                                                                                                 million jobs when
                                                                                                                   Overdevelopment is a key challenge which is                                downstream effects are
                                                  of infrastructure, such as transport networks,
                                                                                                                   likely to worsen as travel becomes increasingly                            taken into account.
                                                  sanitation works and other public amenities.
          No left turn
                                       No                                                                          accessible. Despite the economic benefits that
                                     U-turns      Many developing countries are highly reliant on                                                                                             Source: Aviation: The Real World

                                                     No goods veh
                                                                    icles                                          tourism can bring to a region, there are often                             Wide Web. Oxford Exonomics.
                                                  tourism
                                                       over maand
                                                                ximum in some countries it can represent
                                                        gross weight                                               some environmental and social trade-offs for
                                                  up to   30% nes
                                                      shown (in ton
                                                                      of) GDP3. The industry’s predicted
                                                      except for  loading                                          the local population. When a new destination                               1. GDP – Gross Domestic
                                                  growth       reflects
                                                        and unloading
                                                                             the increasing mobility of                                                                                          Product
                                                                                                                   suddenly becomes popular, resorts can be                                   2. World Travel & Tourism
                                                  populations
                                                      comprehen    sive  in emerging  economies: in 1995                                                                                         Council Leading the Chal-
                                                     use, a
                                    s commonly in                        ns,
                  ny of the sign                        Your Traffic Sig                                                                                                                         lenge on Climate Change
de shows ma                            booklet Know                     signs
      give n in the   Department’s               s the vast majority of                                                                                                                          February 2009
m  is                            es and exp lain                 all drawn to
               also   illus trat                      de are not
The booklet                            Highway Co                         lish                                        ility of popula
                                                                                                                                      tions                                                   3. Why your world is about to
                 illustrated in The                      Welsh and Eng                                 increasing mob
er. The signs                           used including                                                                            ies                                                            get a whole lot smaller. Jeff
                     some signs are                 seen on the roa
                                                                     ds.                                     in emerging econom
 ual versions of            of sign s may still be                                                                                                                                               Rubin. Pg 235
                     ign s
Some older des                                                                                                                                                                                4.	UNWTO World Tourism
                                                                                                                                                                                                 Barometer
                      growth &
                      employment
                                                                                                           train       BOAT       plane                                                                                      25
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