A year in review Economic / Governance Environment Social Appendix Climate change Material topic definition Impact Living our purpose and showing our love for nature in Climate change We generate GHG emissions through energy use (combustion everything we do also means protecting our precious natural in our own processes as well as the use or purchase of environment and the resources it provides. There is an urgent Mitigating effects on climate change by reducing electricity and steam) and activities in our supply chain. need to accelerate action in many areas of our business and GHG emissions and supporting adaptation and actions Specifically, Scope 1 emissions are direct emissions from we have adopted global standards and ambitious goals. We along Givaudan’s value chain (for example, by ensuring sources we own or control, including, for instance, fuel wish to be accountable for our climate action and support sustainable use of land to address deforestation). combustion in our factories. Scope 2 emissions are indirect global efforts such as the UN’s Sustainable Development Goal emissions related to the use of purchased energy (electricity 13 on climate action. Purpose pillars or steam). Scope 3 emissions are all indirect emissions that CREATIONS NATURE PEOPLE COMMUNITIES occur in our value chain. In terms of synthetic ingredients, we must consider the energy needed to create them, and SBTi’s Net-Zero Standard whether they are made from fossil feedstock. With naturals, Disclosure 103 – 1 we need to consider land use change, deforestation, We were among the companies taking part EXPLANATION OF THE MATERIAL TOPIC agricultural practices and animal-derived products. in the 2021 road test of the SBTi’s Net-Zero AND ITS BOUNDARY Standard. The world-first common Climate change and related shifts in weather patterns and sea These are all major components of climate change and we framework recognises the urgency of the levels are disrupting people, business operations and economies must ensure that our raw materials are produced sustainably. climate crisis and the need for businesses around the world. The direct consequences of man-made climate Our efforts in these areas necessarily extend beyond Givaudan to respond robustly and credibly, aligning change, that is, an increase in the concentration of greenhouse to include the supply chain. Details on how we encourage action across industries and geographies. gases in the atmosphere, include rising temperatures, rising sea suppliers to observe our rigorous standards are described in the We strive to deliver on purpose and levels, higher ocean temperatures, an increase in heavy chapter on Responsible Sourcing & Traceability. sustainability ambitions, knowing that no precipitation and floods, a decrease of precipitation, shrinking one business can tackle the issue alone. glaciers and thawing permafrost. Indirect consequences are Boundary Action depends on a collective effort and wide-ranging, spanning from an increase in hunger, water crises, • Givaudan shared commitment to creating a future poverty and political unrest, to loss of biodiversity. • Suppliers we can be positive about. Risk Disclosure 103 – 2, 103 – 3 As such, climate change is a driver for a number of effects that MANAGEMENT APPROACH may in turn affect Givaudan’s ability to operate. A continued The latest climate science says that temperature increase must build-up of GHG emissions is expected to lead to changed not exceed 1.5°C compared to pre-industrial levels if we are to weather patterns and an even greater threat to supplies of avoid the most catastrophic effects of climate change. natural raw materials. This may translate into disruptions in the Reaching this goal requires that emissions fall by half by 2030 supply of natural raw materials or to operations because of a and that we reach net-zero emissions no later than 2050. water supply shortage, for example. It therefore poses significant There is therefore limited time for action and the private sector risks to our operations and supply chain: our business depends has a crucial role to play. on these natural resources and continuity of supply is critical. 51 Givaudan — 2021 GRI Sustainability Report