2023 Double Materiality Assessment

Double materiality assessmentExcerpt from the 2023 Integrated Report on economic and ESG performance Double materiality assessmentOur first materiality assessment, conducted in 2011 in alignment with the GRI Sustainability Reporting Standards, marked our commitment to meaningful dialogue with our stakeholders and served as a foundation for identifying key environmental, social, and governance (ESG) material topics. Over the course of 11 years, we have continuously updated this assessment through internal reviews and comprehensive revisions in response to evolving regulations.In 2023, Givaudan conducted its first-ever double materiality assessment, a comprehensive framework employed by companies to evaluate and disclose their ESG impacts and risks. This assessment goes beyond the traditional approach by considering impacts on the environment, society, and the economy (outward-looking) as well as risks and opportunities for our business related to sustainability (inward-looking). Conducting a double materiality assessment allows Givaudan to gain deeper insights into the risks and opportunities associated with sustainability, fostering in turn enhanced transparency, accountability, and long-term value creation for both the Company and society. It enables us to focus on areas that influence our value proposition and demonstrate our commitment to sustainable development. Finally, our activities clearly extend beyond economic outcomes and it is imperative to align our business performance with the expectations of our stakeholders and society at large. Our double materiality assessment provides a profound understanding of the most relevant ESG material topics for different stakeholder groups, information that is critical to accomplishing this goal. An outline of our comprehensive process for identifying and prioritising ESG material topics is given below. Establishing scope and boundaries – identification of relevant topicsThe double materiality assessment process started with the essential step of defining its scope. We initiated this phase by describing the boundaries of the assessment, identifying relevant ESG material topics throughout our extensive value chain that are important to our stakeholders. This year, we emphasised the identification of the material topics rather than management approaches to avoid potentially overlapping areas, resulting in some changes to our matrix. The approach allowed us to cover the intricacies of the supply chain, operational aspects, and the wide array of the products and services we offer. Our approach drew from various sources and incorporated meticulous analysis, including a thorough review of internal and external documentation, industry insights, regional trends, and challenges. We also scrutinised existing commitments and adherence to industry-leading frameworks such as the GRI Sustainability Reporting Standards, Task Force on Climate-related Financial Disclosures (TCFD), and Corporate Sustainability Reporting Directive (CSRD) to ensure alignment with best practices and industry standards.The outcome of this analysis, which was supported by external experts, was a long list of potentially material topics that then served as the starting point for subsequent assessment. The efforts also produced a list of stakeholders relevant to the assessment, a crucial aspect. These elements then underwent rigorous validation with Givaudan’s project team, ensuring alignment with the Company’s strategic objectives and sustainability goals.Impact materiality (inside-out)The next phase involved conducting an independent, expert-based impact assessment evaluating the scale, irremediability, and likelihood of both positive and negative, actual and potential, intended and unintended impacts throughout Givaudan’s value chain for each longlist topic. This thorough analysis ensured a well-rounded understanding of the impacts associated with each ESG material topic identified.Givaudan’s Sustainability Leadership Team validated the impact assessment and prioritisation of ESG material topics, with their expertise and insights further confirming the significance and relevance of the identified impacts. © Givaudan SA – January 2024 UPSTREAM DOWNSTREAMClimate changeBiodiversity & ecosystemsHuman rights & labour conditionsWater securityProduct quality & safetyWaste management & circular principlesEconomic performanceWorkforce health, safety & wellbeingGovernance & business conductIngredients & productsDiversity, equity & inclusionConsumer health & wellbeingData privacy very high high medium low N/AThe results of this assessment are presented below as an overall ranking of the impacts and as an overview of the points along the value chain where Givaudan has the biggest positive or negative impacts.Financial materiality (outside-in) Assessment and methodologyThe primary goal of the financial materiality assessment was to identify and validate the most significant sustainability-related risks