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SOCIETY AND CLIMATE
Mr. Kott, Symrise has been basing its activities on the United Nations’ 17 Sustainable Development Goals for many years now. Which issue did the company focus on during the past fiscal year?
We broke down our sustainability activities into the four areas of footprint, sourcing, innovation and care. We transparently meet all SDGs in each of these categories. We are active in the entire range of issues because we are determined to become more sustainable. At the same time, we certainly want to remain commercially successful and be socially accepted. We focused last year on the issues of climate and supply chains.
Let’s start with the climate. What are your objectives there?
We intend to be completely climate neutral by 2045, and this includes raw materials that we source from suppliers. We plan to reduce our Scope 1 and 2 greenhouse gas emissions to such a low level that we will be climate neutral in this area in 2030. By that point, we intend to lower our Scope 3 greenhouse gas emissions, the segment that encompasses the emissions that occur during raw material production and transport, by 30 % compared with 2020. These levels are linked to the targets of the Executive Board and the next management levels to create a financial incentive.
Symrise is a huge business group. How do you implement these plans?
The headquarters in Holzminden is large and diverse. 80 % of all technologies that we use in the entire Group is located here. Holzminden serves as something of a blueprint for Symrise. We have identified the processes here that emit the most CO2. We have analyzed the current state and the future of energy-production technologies as well as price trends for electricity, gas and hydrogen. Based on this research, we drew up a concept that will enable us to hit our climate targets and calculated investments in higher-impact sustainability technologies. In the process, we will reduce our use of oil and gas, electrify our operations to the greatest degree possible and stop emitting CO2 by 2045.
You just mentioned electrification, an area that is seen as a key weapon in the battle against climate change. What measures do you plan to introduce?
We have to create a smart system whose features are intelligently based on one another. As part of this effort, we are using solar energy to generate electricity wherever we have large areas of space. In Germany, we are talking about the halls used by our logistics operation. But, above all, we are taking this approach in countries that get tremendous amounts of sunshine. We have installed a 4,800 square-meter photovoltaic system in our plant in Granada, Spain. This system can generate up to 1.6 million kilowatt hours of electricity a year. This is enough to meet 15 % of the production operation’s power needs. Producing energy where it functions is a good lever for us. But the energy we produce ourselves will not meet our total demand. This is why we continue to purchase electricity. We have been exclusively using green power around the world since 2020.
From power generation to consumption: How do you intend to further reduce this level?
For years now, we have been doing the same thing that every household does: We cut our use of electricity wherever we can, from offices to plants. In our production operation, we can take other approaches as well. In many cases, we use steam at 30 bar pressure in our processes. We use gas to do so. But, for some processes, you only need steam at three or eight bar pressure. We can produce this steam with an electrode boiler. We are taking a similar approach with heat, an area where we have switched to heat pumps just like private households. You could not have done this on an industrial scale a few years ago. But the technological progress made since then has created all sorts of new alternatives.
We have had a very good overview of the challenges we face in various countries and regions for a long time.Bernhard Kott, Chief Sustainability Officer
Symrise faces a challenge: It intends to grow and will grow. By 2028 – the new long-term goal – you want to generate sales of between € 7.5 billion and € 8 billion. How will you meet the additional energy needs that a significantly higher production level will require?
We are confident that the current measures we have taken will enable us to save tremendous amounts of energy, something that we can also scale. We also think that energy-generating technologies and the technologies that we use in our processes will become increasingly more efficient. Long range, we also have completely new forms of energy on our radar, things like developments in hydrogen technologies. We are intensively monitoring them. We are planning to have made huge strides in this area by 2040 – we will not include hydrogen in our planning until then.
How will the findings in Holzminden be used?
The pilot project has been completed. We are now rolling it out at all locations. We will conduct the same analyses and assessments everywhere and then introduce measures to address the individual situation. In step one, we will take a look at those locations where we can quickly prevent the most emissions. This will be good for the climate and for us, too, because we can lower long-term costs. With Germany and the United States, we cover 75 % of all CO2 emissions right now. We will tackle the rest of the world at a later stage, but in a very timely fashion.
How do things look for Scope 3, the CO2 emissions in the supply chain?
We launched the sweeping program called “Houston” last year in the Taste, Nutrition & Health segment (see Bring on the future). In this work, we plan to analyze and assess emissions that arise on the product basis. We have to look very deeply into the value chain in this process. This also involves water consumption that we are directly recording. We are talking about scarce resources here. Starting in 2024, we have to base our reporting on the new CSRD Directive. This makes water consumption a higher priority.
We must stop climate change – and Symrise has been doing its part for years.Bernhard Kott, Chief Sustainability Officer
The second major issue in 2023 was supply chains. What did you do in this area?
Last year, we focused closely on the natural raw materials that are essential to our company. We have had a very good overview of the challenges we face in various countries and regions for a long time. For this reason, it was not hard for us to include sourcing practices and human rights in our materiality analysis as the German Supply Chain Due Diligence Act requires.
What does that mean?
Over the past few years, we have set up teams that examined the issues of health, safety and overall work conditions among suppliers – and focused in particular on the so-called vulnerable groups. In our case, we are talking about very many small farmers who possess little and earn little. We collected data on more than 20,000 suppliers, structured it and evaluated it on the basis of our Supplier Code of Conduct. By the way, we posted the code in various languages on our website.
How time-consuming was this process?
It involved a whole lot of work. You can see what I mean by looking at the small farmers again. They frequently do not own a computer, only smartphones. As a result, they cannot even express their consent to our Code of Conduct in writing. For this reason, our employees drove to them, inspected their work conditions and documented them. The results of this multi-stage process have to be organized in a way that enables them to be audited. But one finding really pleased us: There were just a few cases where we needed to make improvements.
Last year, the focal issue was the circular economy. What was done here?
The circular economy continues to be one of the core focal points of our sustainability activities. We work in all areas to do such things as use packaging materials as smartly as possible – through the selection of materials or innovative ways to pack products. The Pet Food division shows us how the circular economy works regarding the use of raw materials. Virtually all raw materials used here come from side streams or other production operations or reuse. We will continue to take this approach, throughout the entire Group.
We launched our Symsafe initiative in 2022 to improve our performance in terms of occupational health and safety.Bernhard Kott, Chief Sustainability Officer
Let’s talk about occupational health and safety for a moment. Symrise has done somewhat poorly here in recent years. Has the situation changed any?
Yes, we have made tremendous progress. We launched our Symsafe initiative in 2022 to improve our performance in terms of occupational health and safety. In the process, we improved our MAQ level – this is a German metric that is used to measure the number of occupational accidents with at least one lost day per million hours worked. We have lowered the level from 2.8 to 2.3. We intend to reach 2.2 this year. Our mid-range goal is to decrease it below 1.5 and keep it there. As part of the Symsafe initiative, we appointed occupational health and safety officers around the world and introduced a series of rules and measures that apply to the everyday workplace.
All of these measures require large amounts of resources. You now face another EU directive that you will have to implement in 2024. Reporting will change drastically once again as a result of the Corporate Sustainability Reporting Directive (CSRD). How have you prepared for it?
We devoted a very large amount of time to the topic of the CSRD in 2023. The area of double materiality will play a role starting this year. This means that we have to report not only on the way that our business activities impact people and the environment, but also on the impact of sustainability issues on our company. There is no doubt about it. This will require a lot of work on the one hand. On the other, we have been reporting very transparently on our sustainability performance for a long time, in part because we want our customers to gain an understanding of the impact that our products have on the environment. Apart from that, we are happy to take on the great amount of work involved. It’s obvious. We must stop climate change – and Symrise has been doing its part for years.
MAQ denotes the number of occupational accidents with at least one lost day per million hours worked.