Identified Material Aspects and Boundaries

We are a global organisation with 4,273 employees across 36 countries*. By being close to our customers around the world, we have a collaborative approach to business, which allows us to respond quickly and efficiently to unmet needs.

Our Business is split into four reporting market sectors:

Personal Care

We are the world’s leading supplier of speciality ingredients for the personal care industry. We achieve this by offering our customers expertise in formulation development, claims substantiation, market analysis and regulatory support. Our ingredients are used in a range of applications including skin care, sun care, hair care, colour cosmetics and toiletries.

Life Sciences

Our Life Sciences market sector comprises two complementary businesses, Health Care and Crop Care. Health Care delivers high quality ingredients and formulation expertise to pharmaceutical and nutritional markets, which includes dermatology and animal health. Crop Care provides innovative ingredients and formulation expertise to agrochemical companies, enabling them to develop efficient, complex and safe products that help farmers achieve superior yields.

Performance Technologies

Performance Technologies delivers high added value additives to a wide range of niche markets. It is organised into five business areas: Lubricants supplies automotive and industrial lubricants companies; Coatings and Polymers serves the coatings, adhesives and speciality polymers markets; Geo Technologies supports customers in oil and gas, water  treatment and mining; Polymer Additives sells into the plastics and packaging sector; and Home Care serves household product manufacturers, as well as industrial cleaning companies.

Industrial Chemicals

 Our Industrial Chemicals market sector sells a range of co-streams produced during the manufacture of core sector products and undertakes toll processing. Whilst primarily higher in volume and lower in margin, the sector is also developing niche ranges of specialist materials for thermal management, catalysts, electronics, advanced ceramics and other industrial applications.

In addition to the above, the Group has a Technology Investment Group that identifies and integrates new technology into the global Business structure, and a Process Innovation Team that innovates with new and existing processes to improve operational processes.

A list of our principal subsidiary companies that primarily affect the financial statements can be found on page 134-136 of our 2016 Annual Report. No entity included in our financial statements has been excluded from this report.

More information on our organisational structure can be found at www.croda.com.

*As at December 2016

Our sustainability programme is guided by the three global drivers that we consider to be the most important to the future of our Business:

1. Changing Demographics

2. Fragile World

3. Changing consumer expectation and behaviours

As the impact of such global drivers changes the world around us, our sustainability programme must continue to evolve to meet the needs of our stakeholders, especially our customers and their consumers. We review our materiality annually with our Executive Committee and a panel of sustainability experts within the Business who sit on our Group Sustainability Steering Committee. The review takes place in four stages:

1. Identification and prioritisation of key Material Areas within Croda

2. Identification and prioritisation of key Material Areas for our stakeholders

3. Determination of materiality

4. Revision of our sustainability programme

Stage 1 - Identification and prioritisation of key Material Areas within Croda

We first defined our Materiality and Matrix in 2011. In 2013, we conducted an extensive review of our programme by considering the opportunities and threats presented by global drivers of change. As a result, we redefined our programme into 10 Material Areas with longer-term objectives.

In 2015, we conducted an appraisal of these Material Areas. Experts on the Steering Committee and the Executive Committee provided insights on how these Material Areas were received within the business, how they could be improved, where more resource is required, and gaps in the programme with future potential. These suggestions were then considered together with other factors, such as stakeholder priorities.

Stage 2 - Identification and prioritisation of key Material Areas for our stakeholders

Alongside insights from the Business, we conducted an extensive global stakeholder survey in 2014 to inform our Materiality and Matrix and an supplementary survey in 2015. Internal and external stakeholders were surveyed on all aspects of our sustainability programme, and key highlights from the survey include the following:

•Quality and safety are the most important themes to all stakeholders

•100% of customers believe we are very transparent/transparent in communicating our sustainability programme

•100% of customers and 67.7% of suppliers consider our sustainability programme to be a very important/ important reason to engage with us

•Process safety and employee safety are the priorities for the local communities in which we operate

•57.3% of employees say our sustainability programme is a very important/important reason for working for us

As well as the survey, we maintain a culture of open communication with our stakeholders throughout the year and conducted additional face-to-face meetings with investors, suppliers, customers, local communities, NGOs and regulatory bodies. Views of these stakeholders were represented at the annual review by the various experts from within the Business who have regular contact with these groups.

We also considered other external factors during the review and invited key stakeholder in to represent the views of our customers, peers, investors and third parties covering reporting frameworks such as human rights and lifecycle analysis.

Stage 3 - Determination of materiality

 Each year we review our Material Areas with internal and external stakeholders. The Material Areas are then mapped onto our Priority Matrix, which details the areas of most importance to us and our stakeholders. The results from our stakeholder survey informed our updated Materiality Matrix, which shows the areas of highest importance to us compared to our stakeholders.

2016 GRI Report Priority Matrix™


Stage 4 - Revision of our Sustainability programme

The previous three stages of our review informed the 2015 updates to our sustainability programme. Key updates include:

  • Product Stewardship will increase in scope to include formal engagement with our upstream supply chain to further mitigate risks
  • Product Design will now prioritise the communication of the sustainability benefit of our products in use, and will also extend to measure the performance of existing products, as well as New and Protected Products, to enable our customers to make better choices
  • Knowledge Management, formerly Corporate Knowledge, has been repositioned to better reflect the fact that we focus on tools and processes to manage the knowledge of our people across the Business.

To continue to deliver improvement against our Material Areas, we establish clear commitments and performance targets. New or revised targets are set each year at our annual review with the input and approval of our Group Executive Committee.

In 2016, our sustainability programme was agian reviewed by the Group Executive Committee with the Global Sustainability Team and the Global Sustainability Steering Committee. No changes were made.

As a result of the annual review of our sustainability programme, the below Aspects were considered material:

Economic Environmental Labour Practices and Decent Work
Economic Performance Materials Employment
Procurement Practices Energy Occupational Health and Safety
 Anti-corruption Water Training and Education
 Anti-competitive behaviour Biodiversity  Diversity and Equal Opportunity
  Emissions  
  Effluents and Waste  
  Compliance  
Human Rights Society Product Responsibility
Freedom of Association and Collective Bargaining Local Communities Customer Health and Safety
Child Labour Public Policy  Product and Service Labelling
Forced or Compulsory Labour Marketing Communications
  Customer Privacy
    Compliance

In 2016, we had our first independent thrid part verification of our energy and carbon reporting systems. As part of this process we identified some systematic changes that had to be made to our fossil fuel methodology calculation. This has meant that the target we set in 2015 to reach a non-fossil fuel energy level of 30% by 2020 has now been rebased to 27%.

Since our last report in 2015, there have been some changes to the Group targets.

Our performance against targets and future targets can be found throughout the Sustainability Report.



This report covers the sustainability performance of Croda International Plc for the period 1 January 2016 to 31 December 2016. The scope of this report is all wholly owned operations, plus those operations where we have significant management influence due to a majority shareholding. Unless otherwise stated, data provided throughout this report is for continuing operations.

In December 2015 we acquired Incotec Group BV and in May 2016 we bought the technology platform of Inventiva Ltda. Due to the timing of these investments, our focus during 2016 has been to align and report their financial and Safety, Health, Environment and Quality performance. We have stated within this report where the activities of these operations have been excluded while we work with them to embed our systems.

The material Aspects therefore cover all fully managed operations, with the exception of those which fall under the Environmental section. Only data from our 19 manufacturing sites is included in these Aspects, as the impacts from our remaining 48 operations are not material by comparison.

The boundary assessment concluded that the majority of material aspects are only material within the organisation. If and where exceptions occur, these are clearly stated within the disclosure.

More information about our operations can be found in our Annual Report.

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