KYNDRYL HOLDINGS, INC.

Carbon per million dollars of revenue. The legacy industry-standard reference (CDP, MSCI). Useful for cross-sector context, but distorted by margin — high-margin firms appear artificially efficient. Read alongside the operational and asset intensities for the full picture.

OpEx (operating expenditure) is the running cost of the business — staff, services, energy, materials. This shows how carbon-intensive operations are per million dollars of spend. Removes the margin distortion that revenue-based ratios introduce.

EVIC (Enterprise Value Including Cash) is the firm's total capital footprint — equity + debt + cash + minority interest. The EU's standard intensity measure (SFDR PAI 3) — answers: how much carbon does each million of capital deployed in this business produce?

PP&E (Property, Plant & Equipment) plus leased real-estate assets is the firm's physical infrastructure on the balance sheet. This shows the carbon intensity of that physical footprint — uses Scope 1+2+3 for consistency with the other headline intensities. Surfaces stranded-asset risk for asset-heavy firms.

In fiscal 2025, 58% of purchased electricity came from renewable sources (up from 51% in FY23 and FY24). Kyndryl aims to follow RE100 guidance as it manages renewable energy procurement toward its goal of 100% renewable electricity by 2030. Energy efficiency and renewable energy use are considered when selecting new data center locations.

Report does not disclose use of durable carbon removals (DAC, BECCS, biochar) or offsets. Strategy focuses on absolute emission reductions through data center transformation, energy efficiency, renewable electricity procurement and supply chain engagement rather than removals or offsets.

• Data center consolidation and transformation

  Kyndryl is consolidating legacy data centers and shifting IT workloads to more modern, energy-efficient and climate-resilient sites and cloud platforms. This was the primary driver of the 26% reduction in scope 1+2 emissions vs FY23 baseline. Weighted average PUE was 1.9 overall and 1.7 for sites in the EU Code of Conduct.

• Data center energy efficiency projects

  In fiscal 2025, Kyndryl reduced energy use through energy efficiency projects by 24,400 MWh, resulting in the avoidance of approximately $2.7 million in electricity costs. Projects include modernizing and refreshing IT equipment, consolidating and virtualizing IT workloads, and implementing cooling and airflow efficiency projects through AI and automation.

• Business travel reduction

  Reduction in business travel emissions contributed to the 15% reduction in scope 3 emissions vs FY23 baseline, alongside reduced upstream and transportation-loss related emissions.

• IT e-waste circularity and reuse

  Kyndryl's waste diversion program prioritizes reuse and resale of IT assets, working with scrap suppliers (all with third-party recycling certification) when assets cannot be reused. FY25 IT e-waste landfill diversion rate was 99.99% (only 9 kg landfilled). Aim for 100% diversion by 2030.

• Data center transformation and asset-light strategy

  Kyndryl's primary decarbonization lever is consolidating legacy data centers and migrating IT workloads to more modern, energy-efficient sites and cloud platforms. This asset-light strategy is expected to reduce Scope 1 and 2 (market-based) absolute emissions by a minimum of 4.5% annually. When considering new data centers, Kyndryl includes energy efficiency and renewable energy use as key site criteria. This strategy also reduces Scope 3 category 3 (T&D losses) emissions. In FY2025, this led to a 17.3% reduction in Scope 1 and Scope 2 (market-based) emissions compared to FY2024.

• Energy efficiency improvements at operated facilities

  Kyndryl is increasing energy efficiency at operated locations through IT equipment modernization and refreshing, consolidation and virtualization of IT workloads, and cooling and airflow efficiency projects using AI and automation. The company also retires, consolidates, and replaces older energy-intensive mainframes with newer, more energy-efficient technology. Kyndryl has one of the largest datacenter portfolios accepted into the EU Code of Conduct for Energy Efficiency in Data Centers. In FY2025, 247 energy efficiency initiatives were fully implemented, yielding estimated annual savings of 5,400 tCO2e and 24,444 MWh, at an investment of approximately $904,000.

• Scope 3 supply chain decarbonization (Cat 1 & 2 - purchased goods and services)

  Purchased goods and services (Cat 1: 504,096 tCO2e) and capital goods (Cat 2: 31,122 tCO2e) together represent the largest portion of Kyndryl's Scope 3 inventory. Kyndryl engaged over 7,500 suppliers in a global education campaign in FY2025, encouraging adoption of SBTi-aligned goals. More than 85% of top-tier suppliers (200 suppliers contributing ~75% of Cat 1 & 2 emissions) completed or were in the process of completing the EcoVadis questionnaire. Kyndryl uses the CDP Supply Chain program and EcoVadis platform to monitor supplier emissions and ESG performance and requires suppliers to meet RBA Code of Conduct standards.

• Energy efficiency, mainframe modernization and AI-driven cooling

  Achieved nearly 19,000 MWh of energy efficiency savings in fiscal 2024, generating ~$2.6 million savings. Retiring/consolidating energy intensive mainframes saved ~3,500 mtCO2e. Implementing AI/automation-driven cooling and airflow projects. EU Code of Conduct for Energy Efficiency in Data Centres participants achieved weighted average PUE 1.7 vs overall 1.8.

• Datacenter transformation and asset-light strategy

  Kyndryl is consolidating legacy data centers and migrating IT workloads to more modern, energy-efficient locations including hyperscale cloud providers. Site selection criteria include energy efficiency and renewable energy use. The strategy reduces Scope 1 and location-based Scope 2 emissions by closing high-carbon, energy-intensive facilities. Scope 1 fell 9.2% in FY2024 vs FY2023 primarily due to asset reduction. The firm has one of the largest portfolios accepted into the EU Code of Conduct for Energy Efficiency in Data Centers.

• Energy efficiency in data centers and offices

  Kyndryl implements energy efficiency projects including cooling and airflow improvements (cold aisle installations, CRAC unit rightsizing), IT equipment modernization and refreshing, virtualization of IT workloads, replacement of energy-intensive mainframes with newer technology, and LED lighting upgrades. In FY2024, 153 projects were fully implemented saving ~5,400 tCO2e/year and ~$2.7M. 193 projects are in implementation with 7,300 tCO2e/year estimated savings. Projects are prioritized using ROI calculations and marginal abatement cost curve analysis.

• Business travel and employee commuting reduction

  Business travel (32,429 tCO2e in FY2023/24) and employee commuting (102,613 tCO2e) are identified as key long-term decarbonization levers. Kyndryl notes these as part of its long-term net-zero strategy and plans to introduce employee education and awareness initiatives. The company's hybrid workplace strategy and digitization of work processes are cited as tools to reduce commuting-related emissions. Business travel emissions are calculated using AMEX GBT data with distance- and spend-based emission factors.

• Datacenter consolidation and workload migration

  Executing datacenter transformation strategy: consolidating legacy datacenters and moving IT workloads to more modern, efficient locations including cloud providers, with energy efficiency and renewable energy use as siting criteria. This was the primary driver of the 8% scope 1+2 (market-based) reduction and 12% scope 3 reduction in fiscal 2024.

• Scope 1 and 2 absolute reduction via SBTi-aligned near-term target (75% by 2030)

  Kyndryl's near-term Abs 2 target commits to a 75% reduction in market-based Scope 1 and 2 emissions by 2030 from a FY2023 base of 318,329 tCO2e. Key levers are renewable energy procurement and energy efficiency at data centre and office operations. Kyndryl also explores alternative fuel options to reduce reliance on fossil fuels and has ISO 14001 and ISO 50001 certifications in process.

• Business travel reduction and employee commuting management

  Business travel (32,429 tCO2e) and employee commuting (102,613 tCO2e) together represent a material share of Kyndryl's Scope 3 inventory and are explicitly included in the near-term 50% reduction target (Abs 1). Kyndryl's hybrid workplace strategy and digitisation of workplace processes aim to reduce employee commuting and onsite emissions. Business travel emissions are calculated using a hybrid supplier-specific and spend-based methodology.

• Data centre energy efficiency and footprint consolidation

  Kyndryl is rationalising its portfolio of 240 data centres in over 50 countries through closure of older inefficient sites, consolidation into more efficient locations, and IT equipment refreshing (eliminating zombie/idle gear, replacing legacy hardware). Specific measures include cooling and airflow improvements (floor tile management, cold-aisle installations, CRAC right-sizing), IT workload virtualisation and consolidation, and lighting upgrades to LED. In FY2023, 161 implemented initiatives generated 2,112 tCO2e in annual savings and USD 1.09 million in monetary savings. Kyndryl participates in the EU Code of Conduct for Data Centre Energy Efficiency with 32 data centres accepted.

• Real estate and data center footprint consolidation

  Consolidating and modernizing legacy real estate and data center footprints to ensure utilization of real estate portfolio is optimized. This is a key lever in Kyndryl's GHG Emission Reduction Pathway to net zero by 2040.

• Data center energy efficiency and PUE optimization

  As of report date, Kyndryl operates 230+ data centers in 54 countries. The strategy includes measuring/optimizing PUE (FY2022 weighted average 1.8; 1.7 for EU Code of Conduct sites), virtualizing IT hardware, improving cooling/airflow through software, AI and automation, and refreshing/modernizing hardware. Since launch in 2021, Kyndryl has reduced data center energy consumption by over 16,000 MWh (~6,000 mtCO2e) through 350+ projects, yielding $4M cumulative savings.

• Employee commuting and business travel reduction

  Employee commuting represents 14.1% of Scope 3 (102,613 mtCO2e) and business travel 4.5% (32,429 mtCO2e). Kyndryl is educating and engaging employees on net zero strategy, with hybrid office strategy and digital workplace solutions to reduce commuting emissions. Mission Net Zero training available in 19 languages; 400+ Kyndryls trained as Carbon Literate via Carbon Literacy Trust.

• Business travel emission reduction through internal policy changes

  Business travel (Scope 3 Cat 6: 43,751 tCO2e in FY2025) is a material dependent lever. In FY2025, Kyndryl implemented stricter controls on reducing business travel-related emissions by modifying internal travel policies, contributing to progress against the near-term SBTi target. Emissions are tracked using a hybrid distance- and spend-based methodology using U.K. Defra factors and supplier-specific data from Kyndryl's main business travel service provider.

• Employee commuting decarbonization through hybrid work and digitized workplace solutions

  Employee commuting (Scope 3 Cat 7: 53,441 tCO2e in FY2025) is tracked via employee surveys extrapolated to the full workforce. Long-term decarbonization strategies include enabling hybrid work models and providing customers with digitized workplace solutions that help reduce on-site commuting emissions. Kyndryl's long-term planning horizon explicitly includes decarbonization of employee commuting as part of the net-zero strategy. The company also offers customers solutions for hybrid office strategies to reduce their own employee commuting and onsite emissions.

• Supply chain engagement (cat 1 & 2 emissions)

  Scope 3 categories 1 (purchased goods and services) and 2 (capital goods) are the largest Scope 3 contributors. In FY25, Kyndryl launched a global education campaign for over 7,500 suppliers on advancing climate action and joined the CDP Supply Chain program. Uses EcoVadis platform — over 85% of largest suppliers completed or in progress on the assessment. Encourages suppliers to adopt SBTi-aligned goals.

• Supply chain decarbonization via EcoVadis and SBTi engagement

  Kyndryl's largest source of emissions is Scope 3 (categories 1 and 2 from purchased goods and services and capital goods comprise ~448,825 tCO2e of the ~906K tCO2e baseline). The firm uses the EcoVadis platform to map ~140 top-tier suppliers covering ~90% of Cat 1+2 emissions. In FY2024 Kyndryl engaged with 90% of high-impact suppliers to share its emissions reduction strategy, provides SBTi awareness training, and tracks net-zero commitments. Suppliers must sign the RBA Code of Conduct. Kyndryl has developed a Scope 3 roadmap for Cat 1, 2 and 3 reduction requirements aligned to its SBTi near-term target.

• Green IT services enabling customer emissions reductions

  Kyndryl offers sustainability-linked services through its Kyndryl Bridge platform to help customers reduce their GHG footprint. Offerings include Sustainable Data Centers (energy efficiency assessments), cloud migration (reducing customer energy use by up to 85% vs on-premises), AI/automation for operational efficiency, and digitizing workplace solutions that reduce employee commuting. This is both a revenue opportunity and a Scope 4 avoided-emissions lever. In FY2024, ~1% of revenue ($160.5M) was aligned to climate transition activities.

• Supply chain engagement on scope 3 cat 1 and 2

  Scope 3 is the largest share of emissions. Identified high-impact suppliers contributing significantly to scope 3 cat 1 and 2; engaged with 90% of them in fiscal 2024 on net-zero strategy and supply chain decarbonisation. Uses EcoVadis platform — nearly 90% of requested suppliers completed/finalized assessments. Achieved CDP Supplier Engagement Rating 'A-' (Leadership tier).

• Employee commute data and reduction

  Conducted employee engagement survey in early 2024 to improve commute emissions data quality and identify reduction opportunities for commute-based emissions.

• Customer-facing sustainability services (Customer Zero)

  Kyndryl Sustainability Advisor and Kyndryl Bridge enable customer GHG/energy/water visibility across hybrid multicloud landscapes. Example: customer cloud migration achieved 87% energy reduction and elimination of market-based GHG emissions; AI-driven cooling setpoint control demonstrated 25% datacenter cooling improvement (~1.3 million kWh saved, 138 mtCO2e reduction).

• Customer decarbonisation enablement through IT sustainability services

  Kyndryl offers IT sustainability services to help customers reduce their GHG footprint, including Sustainable Data Centre assessments, cloud migration (Microsoft Azure, Google, AWS) which can reduce energy usage by up to 85%, automation and AI-driven efficiency tools, and digitised workplace solutions. These services are available on the Kyndryl Bridge platform. Kyndryl is working to quantify and measure the environmental benefits of its services to customers, and this opportunity is identified as material with 'very likely' likelihood.

• Supply chain engagement via EcoVadis and RBA Code of Conduct

  Kyndryl focuses engagement on Tier 1 material suppliers representing approximately 90% of Scope 3 Category 1 and 2 emissions (total 448,825 tCO2e in FY2023). Suppliers are required to sign up to the Responsible Business Alliance (RBA) Code of Conduct, which mandates GHG reduction goals and public reporting. Kyndryl also collects supplier GHG data and targets through the EcoVadis platform and is building an education programme encouraging suppliers to commit to their own net-zero goals.

• Supply chain engagement on Scope 3 emissions

  Building out a roadmap for scope 3 emissions, including evaluating and engaging with suppliers and alliance partners to facilitate sustainable practices, encouraging largest suppliers to commit to their own net zero goals. Suppliers required to sign RBA Code of Conduct, which mandates setting GHG reduction goals and reporting scope 1+2 emissions. Purchased goods and services represent 53.8% of Scope 3 (largest category at 390,206 mtCO2e).

• Cloud migration and customer IT decarbonisation services

  Through Kyndryl Bridge, Kyndryl Consult and SustainabilityOps, Kyndryl helps customers migrate workloads to cloud (AWS, Azure, Google Cloud), reducing energy usage by as much as 85% (per S&P Global). IT Sustainability Assessment quantifies energy/GHG of customer IT landscapes. Case example: Seino Transportation achieved 66% reduction in data center air conditioning power consumption.