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5. Emerging impacts

This section outlines the emerging issues identified during our materiality assessment (see page 132 for a summary of all material and emerging impacts).

5.1 Nature and biodiversity

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Our society and economy need nature to prosper but nature is declining at an unprecedented rate. Restoring biodiversity comes at a cost. If anything, the current nitrogen crisis in the Netherlands shows that we have to be willing to do things differently, taking the limited space that nature has into account and protecting it. If we transform the way we do business, we can put vital ecosystems back on a path to recovery and enhance economic resilience and our future prosperity. Failing this transformation, we stand to lose more than the great variety of species that nature has to offer to us. 

Deloitte’s direct impacts in the area of biodiversity are limited. A study we concluded in 2022 has pinpointed the areas where we can mitigate negative biodiversity impacts. These areas are: offices and buildings, cafeteria, energy, IT, transport and mobility, office equipment and events. As a result we are implementing actions such as a greater offering of vegan and organic products in our cafeteria, and the deployment of refurbished iPhones.

But rather than only doing less harm, we have the ambition to contribute positively to nature and biodiversity. This is one of the drivers behind our mangrove project, our commitment to replant mangrove forests in the Dutch Caribbean starting with a  pilot on Curacao. With this project, we aim to capture carbon on the one hand (study in cooperation with Wageningen University) while contributing to biodiversity on land and below water on the other hand. In addition, our project aims to provide employment to the local community and educate local people on the importance of the protection of biodiversity and nature.

Collaborating in Curaçao: Planting mangroves for a sustainable future

The Mangrove Reforestation project in Curaçao focuses on the restoration and conservation of mangrove forests, vital ecosystems crucial for biodiversity and coastal protection, as well as carbon sequestration. In partnership with local organisations, the project aims to plant thousands of mangrove trees to rehabilitate areas affected by industrial activity and natural degradation. Additionally, a collaboration with Wageningen University is established to conduct research on carbon sequestration, enhancing the scientific understanding of how these restored mangroves can capture carbon dioxide and mitigate climate change impacts in the Caribbean. This project not only seeks to restore the natural habitat, but also to enhance the region's resilience against climate change effects, such as storm surges and erosion. The impact of this initiative is significant, contributing to the local and global environment by sequestering carbon, protecting marine life, and supporting the livelihoods of communities dependent on these ecosystems through job creation and education.

The approach to the project underscores the importance of collaboration and sustainability in corporate social responsibility. Working closely with the Curaçao-based organisations CARMABI and Ryan de Jongh foundation, Deloitte volunteers, including senior partners and employees, engage directly in the reforestation activities, demonstrating a hands-on commitment to environmental stewardship. This collaboration extends to knowledge sharing and capacity building, ensuring the project's long-term sustainability and alignment with broader environmental objectives. The aim is to show how corporate entities can actively contribute to global sustainability goals, highlighting the role of corporate responsibility in addressing critical environmental challenges. Some local clients are already involved. 

During 2023/2024, the first Deloitte-supported mangroves were planted as part of a year-long pilot, around the Boca Sami Bay. In April 2024 around 360 m2 was planted and we will be measuring the results of the full pilot later in the year. The Boca Sami area was chosen for its protected status, meaning everything planted is automatically safeguarded from future destruction. Deloitte is covering the costs of hiring and training people to plant the mangroves.

We are working with Dutch university students to monitor and assess the mangroves’ impact over time. As an enabler for the data storage and monitoring of the project, we are developing a platform to verify these sustainability claims. The Environmental and Social Impact platform is developed using secure blockchain technology together with a technology provider. This will enable us to transparently share knowledge about where the mangroves are planted, what is happening in the area, how much carbon is stored, and what the impact on biodiversity is now and possibly in the future. By developing these components by design in the platform, we aim to set an example for others to join these environmental challenges. 

The Ocean Cleanup and World Wildlife Fund

Next to our active involvement in the mangrove project, we are a longstanding partner of The Ocean Cleanup, an organisation aimed at reducing the amount of plastics in surface water and of World Wildlife Fund, where Deloitte and a consortium of public and private entities have developed a tool that predicts deforestation through automated assessment of spectral satellite imagery and other geospatial data.

 In the coming year, we are planning the following activities:

  • For the Mangroves project, we will aim to accelerate the pace soon by scaling up: hiring more people to plant the mangroves and expanding to other areas and islands. As for the development of the Environmental and Social Impact platform, we are discovering potential partnerships and collaborations with parties that are willing to make the same impact. After the pilot results, we are seeking more projects to onboard and potentially we are expanding the mangrove scope to nature-based projects.

  • Together with DTTL and NSE, assess the feasibility of a Nature-positive ambition for Deloitte;

  • Continue and build our partnerships with organisations that promote biodiversity.

5.2 Sustainable procurement

Why we consider sustainable procurement an emerging impact

We buy goods and services to operate our business, with a total influenceable spend of around €250 million. Our main procurement categories are:

  • Contingent Labour: Our dynamic workforce includes a mix of independent experts and access to specialised temporary staff via staffing agency arrangements.

  • Real Estate & Office Services: We lease our office spaces and outsource all related facility services, such as cleaning, security, catering, and maintenance.

  • Travel: Our operations include a fleet of about 3,500 leased vehicles and we partner with preferred suppliers for domestic and international travel.

  • Technology: Our service delivery relies on the procurement of hardware, software, telecom, data centres, and cloud services.

Our supply chain is primarily rooted in the Netherlands, and over the past year, we've maintained stability in our strategic supplier partnerships.

The Dual Impact of Our Procurement Practices

We're conscious that our procurement activities have a dual impact. Positively, they stimulate economic activity and growth, and foster mutual development with our strategic suppliers, such as LeasePlan, CBRE, and Shell, in becoming more sustainable. However, we're also aware of the potential negative impacts, particularly ethical, environmental, or human rights risks in our supply chain, which we are dedicated to mitigating effectively.

Current Initiatives and Compliance Measures

Our procurement decision-making is governed by stringent processes. The Business Relationship Assessment Tool (BRAT) is a cornerstone of our due diligence - assessing new vendors for independence, integrity, and compliance aspects. We maintain a roster of preferred suppliers thoroughly vetted through BRAT.

We also enforce General Purchasing Conditions that mandate adherence to the Deloitte Supplier Code of Conduct, covering human rights, labour standards, environmental practices, and anti-corruption measures. Our Procurement team, as part of the global CoRe Procurement network, provides oversight and support, ensuring we benefit from Deloitte’s global scale while addressing procurement-related challenges with expertise. On a global level, our suppliers are checked for ESG related elements as part of the selection process and ESG clauses are integrated in contractual arrangements.

In alignment with our WorldClimate programme, we've pledged that by 2025, 67% of our suppliers, accounting for our emissions, will implement Science Based Targets (SBT) that align with the Paris Agreement's 1.5°C target. We are actively engaging strategic suppliers to develop SBTs and disclose their carbon emissions to the Carbon Disclosure Project (CDP).

In order to reach this target, we have established a North South Europe (NSE) Sustainable Procurement Roundtable, a collaborative forum composed of Procurement and WorldClimate leaders from the NSE region. One of the significant initiatives from this Roundtable is the formulation of working towards a comprehensive NSE Sustainability Procurement Policy, aimed at integrating sustainability into every aspect of our procurement processes.

Our sustainable procurement team is dedicated to raising awareness and embedding sustainability in our local supplier selection, contracts, and negotiations, including the development of ESG contract clauses and sourcing questions.

All procurement professionals at Deloitte receive training aligned with our WorldClimate ambitions, enabling them to champion sustainable procurement choices. With General Purchasing Conditions as a standard in all agreements, the Supplier Code of Conduct has virtually 100% coverage, including payment terms and sustainability provisions.

We can still improve on including more sustainability requirements in our existing contracts. In order to achieve this, we need to continue connecting with our longer standing suppliers to start the conversation.

Future Actions and Strategic Direction

Looking ahead, we aim to hone our supplier evaluation through sustainability scoring, helping suppliers advance towards the objectives of the Paris Agreement. Our global procurement sustainability team is at the forefront, driving the integration of sustainability in supplier selection, engagement, and sourcing, with a keen focus on Net Zero principles that support our declared WorldClimate targets.

Through continuous collaboration with our suppliers, we intend to enhance sustainability criteria within our contracts and foster a data-rich environment that offers insights into the environmental impacts within our supply chain. This strategic approach will not only refine our procurement practices but also reinforce our commitment to a more sustainable and responsible business ecosystem.

5.3 Energy availability, affordability and transition

Following Russia's invasion in Ukraine in February 2022, the countries of the EU - among other countries - have implemented trade restrictions with Russia. In response, Russia has ceased to supply natural gas to the EU. In a further escalation of sanctions and counter sanctions, also Russian oil has been affected leading to a global rearrangement of supply lines, pressure on supply and high prices for energy in a market where energy was already becoming increasingly scarce. This has had an effect on inflation affecting almost all economic sectors and a call to private and public sector employers to compensate workers for the consequent loss in spending power. Increased labour costs in turn have led to further price increases.

We are directly affected by rising costs as are our clients. Our people are affected by unpredictable energy costs and higher costs for their daily products.   

Helping society to transition to more sustainable energy sources was already part and parcel of our Future of Energy programme. For more details on this initiative, please check out our website .

With energy costs going down to more acceptable levels over the past year, we will place emphasis on helping our own employees reducing their personal energy use and transitioning to renewable energy sources. Together with our partners within NSE, we will explore ways of doing this in the most effective manner in 2024/2025.

5.4 Human rights

People are at the heart of our business. Respecting human rights therefore is inextricably linked to our shared future. We believe all people are endowed with fundamental human rights, including the right to equal treatment, liberty and security, freedom of religion, expression, health, education and culture, humane treatment, and safe and healthy working environments.

Currently, respecting, protecting and remedying human rights in our own operations as well as in our wider value chain is receiving increased attention from our professionals, clients, regulators and investors:

  • As in the previous years, we have discussed human rights in focus groups with our professionals. This has led to the conclusion that Human Rights are considered especially relevant in the context of the clients that we work for and the suppliers we source from. The human rights of people working for Deloitte are considered less at risk due to existing Dutch legal safeguards. Deloitte's Global 2022 GenZ & Millennial Survey on the other hand shows that new hires have a specific interest in human rights related topics such as wellbeing and work-life balance, income and cost of living, inclusiveness, diversity and equality, social impact and training and development. This provides a basis for ensuring that these themes are respected and supported in our operations as well as in our broader value chain;

  • Corporate Human Rights transparency and due diligence is becoming mandatory for Deloitte Netherlands as part of new European regulations such as the Corporate Sustainability Reporting Directive (CSRD), the EU taxonomy and the Corporate Sustainability Due Diligence Directive (CSDDD). We are also seeing the effects of new human rights regulation coming into effect in Norway, Luxembourg and Germany, in addition to the Modern Slavery Acts already in place in the UK and Australia;

  • Especially larger corporate clients and public sector clients are aware that their responsibility reaches beyond their direct operations and also involves their value chain, as they are preparing for CSRD and CSDDD requirements. Being part of our clients’ value chain, we see an increased need to report on our own efforts  to respect, protect and remedy human rights.

Our activities to date

Deloitte is committed to respecting and promoting human rights in accordance with the principles of the UN Global Compact and the Universal Declaration of Human Rights. As a People oriented organisation, our Talent is of the upmost importance. This is inherent in our Shared Values and ALL IN, our Talent, global diversity, equity and inclusion strategy. We will continue to operate and enhance those as times and demands process.

Regarding our wider value chain, we publish our human rights intentions and expectations through our Annual Impact Reports, Supplier Code of Conduct, Responsible Business Pledge and Global Principles of Business Conduct. This entails that we commit to respecting all fundamental human rights, including humane treatment of workers, and fostering a workplace culture of equality, dignity and respect. We expect a similar commitment of our Suppliers, sub-contractors, clients and business partners. Every new vendor, client and business partner is therefore assessed for independence issues, integrity related issues, and other relevant topics. We ensure that all of our new suppliers are approved by our Reputation and Risk Leadership office and we perform regular checks to confirm that this process is followed.

In the event of any human rights related misconduct or concern, we want to know about it. Any Deloitte employee, supplier, business relationship or other third party may contact any Deloitte personnel with whom a Supplier or member of the public is comfortable directly discussing the matter, report to our Complaints Committee or use Deloitte Speak Up. Deloitte Speak Up is our hotline for confidentially (and anonymously if so desired) reporting unwelcome conduct or suspicions thereof and for asking questions about rules of conduct and integrity.  We have conducted a human rights risk and impact assessment to deepen our understanding of our priority areas in Financial Year 2023/2024. We are currently in the process of stakeholder dialogues to validate this assessment to deepen our understanding of how the full spectrum of human rights relates to our business, so we can focus our efforts on the most severe risks to the people in our value chain.

We are finalising our Deloitte NL human rights policy statement we will publish in the course of the new financial year. This policy statement will contain our commitments on human rights due diligence throughout our value chain.

We are in the process of updating our sustainable procurement activities in terms of further integrating human rights due diligence in our RFP processes.

In our role as service provider we support many of our clients with their own human rights journey, by assessing their salient human rights issues and working together to identify their roles and responsibilities when it comes to preventing, mitigating and/or remediating adverse impacts on human rights. While we align our approach to the ever growing regulatory demands, our work is guided by the international standards and best practices, keeping the focus on the best outcome for rightsholders.

What we plan to be doing

We are responsible global citizens and have the size, scale and reach to inspire others and help drive collective action. Like with our WorldClimate strategy, we have the ambition to raising awareness and empowering people across our value chain to uplift human rights. Collaborative action is vital for positive change. We will therefore collaborate with clients, alliance partners, NGOs, industry groups, suppliers, and others to address human rights at a systems and operations level. 

Some of the practical actions we plan to initiate in 2024/2025 include:

  • Continue stakeholder dialogue on human rights risk and impact assessment and the practical implications of the results of this in our human rights due diligence policy;

  • Finalise and publish a human rights statement that furthers our commitments;

  • Enhance our tooling and visibility on human rights related data across our value chain;

  • Further embed human rights due diligence to identify, prevent, mitigate, and account for human rights impacts in in our supplier, business relationship and client acceptance and monitoring processes;

  • Enhance awareness around human rights with our partners in our value chain and explore opportunities for collaboration to improve our salient human rights risks;

  • Raise awareness of our grievance mechanisms and ensure that our case management and follow-up processes are in good order to handle increased communications and integrate early warning signs and thematic patterns into our human rights due diligence insights;

  • Ensure due diligence findings are integrated in our business practices and processes;

  • Track the effectiveness and regularly assess our due diligence process.

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