Environmental

Materials

We are leaders in natural specialities and in 2016 62% of the raw materials we used were from renewable, natural sources. This figure has stayed in the range of 62-72% for the eight years we have been reporting it, which puts us in an excellent position to benefit from the growing trend in natural based consumer products.

Green chemistry is at the heart of our Research & Development, and each of our new products are scored against the 12 Principles of Green Chemistry. In 2016, 11.6 was the average score of our new products against the 12 Principles.

We are market leaders in sustainably sourced palm oil and its derivatives, and our twelve manufacturing sites certified to the Mass Balance process handle around 99% of our global palm oil derivatives.  In 2016 we saw a 63% increase in Certified Sustainable Palm Oil (CSPO) sales volumes compared to 2015.

Energy, Water, Emissions, Effluents and Waste, Biodiversity

Environmental Impact is one of the 10 Material Areas of our sustainability programme.

We recognise that the world is an increasingly fragile place, and so have set numerous challenging targets to reduce our impact at our 18 manufacturing sites globally:

  • Based on 2015, to reduce total Group energy intensity by 5% by the end of 2020
  • Based on 2015, to generate 27% of the Group’s total energy requirements from non-fossil fuel sources by the end of 2020.
  • Based on 2015, to reduce total VOC emissions by 10% by the end of 2020.
  • Based on 2015, to reduce total Group water withdrawal by 10% by the end of 2020
  • Based on 2015, to reduce Group waste to landfill by 10% by the end of 2020.

The SHE Manager at every manufacturing site is responsible for measuring our environmental impact and adhering to local regulations and policies where applicable. Progressive targets are set by our Group Executive Committee and each site reports on a quarterly basis to Group SHE, who collates the results for the quarterly SHE Steering Committee.

At these meetings, issues are discussed and actions agreed between the Group Vice President of Sustainability, the Group Executive Committee representative and subsequently the relevant Site Director. Improvement plans for non-manufacturing locations are also managed in this way, though the primary focus remains on the largest contributors.

Compliance

We recognise that reducing the environmental and societal impact of our 18 manufacturing sites is essential for our continued license to operate. We therefore have very robust compliance processes in place at each of our manufacturing sites. As a minimum, sites adhere to local regulation and policy, but we often go above and beyond this and require global compliance with stretching Group policies.

We have a number of internal compliance targets, such as compliance with effluent discharge, and our SHE experts regularly attend industry seminars to keep up to date with compliance, as well as contributing to relevant industry bodies to advise and shape relevant legislation.

Our continued robust compliance procedures have resulted in no sanctions for non-compliance of environmental law and regulations.

Partial Reporting

We are a speciality chemical manufacturer who creates high-performance ingredients that enhance everyday products: from hair and beauty, to pharmaceuticals, lubricants and more.

The foundation of our business rests upon natural ingredients, with a large percentage of our raw materials originating from renewable sources. In 2016, 62% of raw materials came from natural, renewable sources. This figure has stayed in the range of 62-72% for the past seven years that we have been reporting it, which puts us in an excellent position to benefit from the growing trend in natural based consumer products.

Renewable materials   62%
Non-renewable materials
 38% 
Total
 100%

This data, covering all external global spend on raw material and process aids, is readily extracted from our SAP system and characterised as being renewable or non-renewable. We do not report product tonnage because it is commercially sensitive. The data also does not include materials for packaging purposes as we currently do not have systems in place to record this data.

The focus on sustainable raw materials and greener, cleaner, safer manufacturing methods is continuing to grow in the speciality chemicals industry. Our heritage in naturally derived products puts us at the forefront of this evolution, with sustainability embedded in our innovations since the launch of our first product, lanolin.

Therefore, new product developments continue to focus on green chemistry, whilst meeting the demands of our customers and the stringent safety standards within our industry. Throughout 2016, our NPPs scored an average of 11.6 against the 12 Principles of Green Chemistry (2015: 11.4) and our top 25 existing products by value averaged 11.3.

This focus on green chemistry goes hand in hand with sustainable supply, which is why we continue to be strong advocates for the responsible sourcing of palm oil, palm kernel oil (PO/PKO) and its derivatives. It remains a key priority for us, and twelve of our manufacturing sites globally are certified to handle sustainable PO/PKO products to the Roundtable on Sustainable Palm Oil (RSPO) Mass Balance process. Out of the 14 manufacturing sites handing handling PO/PKO derivatives globally, these handle over 99% of our total volume, demonstrating our commitment to drive sustainable PO forward.

Further details on our performance against Product Stewardship and Product Design can be found on pages 9-15 of the Sustainability Report

At Croda, we have carefully measured emissions of gases implicated in climate change for more than 15 years and have consistently set targets for reduction. Increasingly demanding targets have been set for 2020 by our Group Executive Committee under the guidance of the SHE Steering Committee. To ensure actions can be taken to bring about change, all major SHE targets are set over a five year time period.

Total energy consumption in 2016 was 3,512,454 GJ.

Total fuel consumption from non-renewable sources in 2016 (GJ):

Natural Gas
2,373,905
Light fuel oil
16,353
Heavy fuel oil
3,026
Gasoline
8,625
Propane/LPG
 9,004
Diesel (Vehicle Fuel)
 18,094
Total
2,429,007

Total fuel consumption from renewable sources in 2016 (GJ):

Biofuel
445,044
Wind turbine/ Solar
14,425
Total

459,469 

Total intermediate energy consumed in 2016 (GJ):

Electricity
527,252
Heating
0
Cooling
0
Steam
96,727
Total
623,979

Direct energy sources sold in 2016 (GJ):

Electricity
1,458
Heating
0
Cooling
0
Steam
0
Total
1,458

Data is reported by  manufacturing and non-manufacturing sites on a quarterly basis using meter readings or invoice data. Energy is only reported for manufacturing sites and does not include offices and warehouses. International electricity conversion factors are taken from: International Energy Agency Data Services - 'CO2 emissions from fuel combustion' latest available edition. Fuel conversion factors are taken from the Greenhouse Gas Protocol Initiative (GHG Protocol)

Further details on energy use can be found in our Sustainability Report on pages 14-18.

Energy intensity for 2016 was 2,824.4 GJ per £1m turnover. The types of energy included in the intensity ratio are electricity, fuel, steam consumed within the organisation.

In 2015, we set a target to reduce total group energy intensity by 5% by the end of 2020, using the 2015 baseline.

Energy intensity is based on our 'value-added', which is operating profit before depreciation and employee costs. To calculate energy intensity we divide energy consumption by value added, which for 2016 saw a 10.1% reduction compared to 2015, indicative of improving energy efficiencies brought about by our investments in energy conservation, especially the new bio-gas combined heat and power plant at our Gouda manufacturing site in the Netherlands. This is an integrated bio-refinery and uses by-product materials to generate energy.

In line with our commitment to continue investing in energy saving initiatives, a detailed energy survey has now been carried out at our Rawcliffe Bridge site in the UK, from which a five year energy programme is being developed. We have also achieved ISO 50001 registration at our manufacturing sites in Hull in the UK and Mevisa in Spain. This has required us to develop an energy strategy and a detailed understanding of the energy situation at each site, as well as investing in training for all personnel on how to manage energy.

Further details on energy use can be found in our 2016 Sustainability Report on pages 14-18.

In 2015, we set a target to reduce total Group water consumption by 10% by 2020, using 2015 as the baseline. In 2016, we recorded a 4.8% reduction in water consumption.


Total volume of water withdrawn by source in 2016 (m3):

Total surface water
2,545,627
Total groundwater
3,617,661
Total municipal process water
114,912
Total municipal mains water
1,322,758
Total water
7,600,958

Data reported by manufacturing sites and non-manufacturing sites on a quarterly basis using invoiced data from utility companies and direct reading of meters.

The biggest change in 2016 was at our Shiga manufacturing site in Japan, where investment to reduce water usage led to a reduction of 2% of total Group water consumption. Another success story is at our Mevisa manufacturing site in Spain, which is one of our few sites to operate in a water-stressed region. Here, from 2012 to 2016 overall water usage has fallen from 1.24 to 0.87 million cubic metres, even though plant output has increased in the same period. This has been brought about by investment in improved cooling infrastructure and water recycling, with further expansion plans in the pipeline.

Further details on how we are tackling the issue of water quality and supply can be found on page 16 of the Sustainability Report.

A review of the locations of our 19 manufacturing sites did not identify any sites that are located in, or adjacent to protected areas, or in areas of high biodiversity according to the Ramsar Convention on Wetlands and UNESCO World Heritage Sites.


We have identified that six of our manufacturing sites are close to some areas of high biodiversity, which are Hull (UK), Rawcliffe Bridge (UK), Campinas (Brazil), Mevisa (Spain), Cikarang (Indonesia) and Shiga (Japan). We are managing the environmental impact of these sites at a local level and setting targets to ensure that we minimise our impact on the environment by effectively managing the material business risk of Environmental Impact.

Our operation at Hull is near the Humber estuary, which is designated as a Special Area of Conservation (SAC) and a Special Protection Area (SPA), as well as being designated as a UNESCO Ramsar Wetland. The river next to the site leads to the Humber estuary and we have a local team in place to continually monitor our effluent discharge. We have also instigated a number of projects on the site to encourage biodiversity including: planting indigenous trees on the boundary of the site to support local wildlife and re-establishing a marsh and pond area on site to support local biodiversity. A biodiversity study has also been conducted at the site by an independent expert and we are in the process of implementing the recommendations.

Our operation at Shiga is near to Biwa-ko, the largest freshwater lake in Japan, which is designated as a UNESCO Ramsar Wetland. The river Uryu is next to the site and leads to Biwa-ko, but as at our Hull site, we have a local team in place that continually monitors our water usage and effluent discharge. Our management teams and SHE experts are working hard at Shiga to reduce our water usage, which will reduce our local environmental impact. A team from the site also volunteers every year to help manage the river weeds along the Urya to support local biodiversity.

Over recent years, our Mevisa manufacturing site in Spain has gone through major expansion, requiring the site’s utilities to undergo a number of upgrades. These upgrades have included an expanded effluent treatment plant to increase the volume of water that can be treated on a daily basis, whilst maintaining a COD discharge level well below the legal limit. They have invested in improved cooling and refrigeration systems to increase the recirculation of cooling water from approximately 55% to approximately 75%. This has reduced water extraction by the site from the stressed local aquifer.

Further details on how we are tackling key environmental issues can be found on pages 14-18 of the Sustainability Report.

We understand that our operations may have an impact upon local biodiversity and we take the stewardship of our own land very seriously. Therefore, we will continue to review our impact on land, water and air.

For more than 15 years we have carefully monitored our environmental impact and set targets to reduce this at all of our manufacturing sites. Reductions in energy and water usage, emissions to air and water and waste production, which has a continuing positive effect in reducing our impact on biodiversity in the areas in which we operate.
In particular, our emissions and waste production have been carefully monitored by our Safety Health and Environment (SHE) group to ensure that we reduce our impact wherever possible and are responsible in the disposal of liquid effluent or solid waste. In 2016, our sites were 99.95% compliant with liquid effluent discharge consents. We also reduced our waste to landfill by 2.5% in 2016 compared to 2015. In 2014 we completed pilot biodiversity surveys at two of our operations.

In 2016 we have continued to launch many new innovations, all of which have intrinsic or extrinsic sustainability benefits, or both. For instance, within our range of crop spraying adjuvants we introduced a new drift reduction agent called AtplusTM DRT-100 for the agriculture industry, where reducing off-target spray drift has long been a major concern. To investigate how we could optimise drop size and shape in order to target spraying accurately onto crops, we invested nearly US$ 1 million into a low-speed wind tunnel in North America to aid the development of Atplus DRT-100. This product enables farmers to minimise the waste of expensive products, such as pesticides, whilst also reducing the negative impact on the surrounding environment and wildlife. As well as these extrinsic sustainability benefits in use, Atplus DRT-100 is made from 100% renewable raw materials, making it an all-round intrinsic and extrinsic performer.

Our new product development teams are committed to making our products as environmentally friendly as reasonably practicable and each year we measure and report new launches against the 12 Principles of Green Chemistry. A number of these principles relate to potential environmental effects that could harm biodiversity including, toxicity, hazardous by-products, persistence and chemical accidents. We aim to reduce the use of environmentally harmful chemicals by finding greener, safer alternatives and always take precautions with any chemicals that could pose a risk to the environment, often going beyond the standards required by legislation. In 2016, the average score for our new product launches was 11.6, and out top 25 existing products scored a value averaged 11.3.

There are a number of key areas where we have influenced our suppliers and customers to provide sustainably sourced raw materials to ensure the preservation of biodiversity.

Case study

Sustainable Palm Oil Sourcing

An important part of our Product Stewardship strategy, and a key priority for Croda, involves responsibly addressing the social and environmental issues associated with palm oil (PO) and palm kernel oil (PKO). For us, this means forming close partnerships with the complex PO and PKO derivatives supply chains.

We joined the leading global body working towards a sustainable supply chain, the Roundtable on Sustainable Palm Oil (RSPO), when it was created in 2004 to do what we can to support and promote sustainable palm oil in our supply chain. We remain active members, in particular in the RSPO Derivatives Working Group, which is where our main interests lie and where we can have the greatest impact.

We use an extremely low amount of pure PO and PKO and relatively small volumes of derivatives that are the result of processing the oil for food markets. We have supported the supply of sustainable PO through the Book and Claim route, purchasing GreenPalm Certificates for the pure PO and PKO that we use during the year. Additionally, we proactively engaged with all of our suppliers around the world, and as a result, we were able to work with our suppliers who are able to offer sustainable palm derivatives using the Mass Balance process.

Twelve of our 14 manufacturing sites that handle PO/PKO derivatives were certified to supply sustainable palm oil to the RSPO Mass Balance process. These twelve sites handle 99% of our total volume, demonstrating our commitment to drive sustainable PO forward.

By the end of 2016, over 440 products were available that support CSPO; enabling us to supply more than 3,500 customer product combinations of CSPO derivatives, covering all geographical regions and all nine business areas; as a result we have seen a 63% increase in CSPO sales volumes compared to 2015.

For our full statement on sustainable palm oil visit www.croda.com/palmoilstatement

Further details on how we are tackling the issues of responsible sourcing and Product Stewardship can be found on pages 7-12 of the Sustainability Report.


We measure GHG emissions compared to a basline year of 2015, against which are current environmental targets are set. Our 2015 and 2016 Scope 1 GHG emissions have received limited verification from Carbon Smart, in accordance with the requirements of the ISO 14064-3 standard.

Scope 1 GHG emissions (TeCO2e):


 
2015
2016
Fossil Fuels
126,551
123,418
Biofuels
454
1,590
VOC
534
473
Non-Manufacturing
2,953
3,069
Total Gross
130,492
128,550
Gases included are CO2 and VOC. The baseline year data is 2015 for the current five year target period and is recalculated when we acquire or shed sites. Emissions factors are calculated using the GHG Protocol and International Energy Agency’s published conversion factors and the methodology used is as per GHG Protocol Corporate Standard. Manufacturing and non-manufacturing sites which we have financial control of are included.

We have acheived an overall 1.5% reduction in gross Scope 1 emissions in 2016.

In 2016, our use of non-fossil fuels and renewable energy has eliminated 23,208 tonnes of CO2 emissions, which is equivalent to taking 11,662 cars off the road or powering 893 homes for the year.

For further details on our GHG emissions, please see our CDP Report.


We measure GHG emissions at all of our manufacturing sites against our baseline year of 2015. Our 2015 and 2016 Scope 2 GHG emissions have received limited verification from Carbon Smart in accordance with the requirements of the ISO 14064-3.

Scope 2 GHG emissions (TeCO2e):

 
2015
2016
Electricity
64,570
61,861
Steam
7,158
5,489
Total
71,727
67,350

Gas included is CO2. The baseline year data is 2015 for the current five year target period and is recalculated when we acquire or shed sites. Emissions factors are calculated using the GHG Protocol and International Energy Agency’s published conversion factors and the methodology used is as per GHG Protocol Corporate Standard. Manufacturing and non-manufacturing sites which we have financial control of are included.

Scope 2 GHG emissions have decreased by 6.1% in 2016.

For further details on our GHG emissions, please see our CDP Report.

In 2015, we began measuring scope 3 carbon emissions. Our 2015 and 2016 Scope 3 GHG emissions have received limited verification in accordance with the requirements of the ISO 14064-3 standard by Carbon Smart. The materiality and accuracy of these reported emissions is under significant development by us at this time and Carbon Smart's observations on development needs are being actively incorporated into our approach for future reporting. As of yet we are not able to separate out biogenic COemissions and we will be working to obtain further information from suppliers as to the source of these emissions.

Scope 3 GHG sources included in the verification process: Raw materials; water supply and treatment; legal services; capital goods; well to tank fuels; well to tank electricity; electricity transmission and distribution (T&D); waste; air travel; car travel; other travel; employee commuting; downstream T&D

Scope 3 GHG emission (TeCO2e):

 
2015
2016
Fossil Fuels
126,551
123,418
Biofuels
454
1,590
VOC
534
473
Non-Manufacturing
2,953
3,069
Total Gross
130,492
128,550
Gas included is CO2. The baseline year data is 2015 for the current five year target period and is recalculated when we acquire or shed sites. Emissions factors are calculated using the GHG Protocol and International Energy Agency's published conversion factors and the methodology used is as per GHG Protocol Corporate Standard. Manufacturing and non-manufacturing sites which we have financial control of are included.

GHG emissions intensity for 2016 was 157.5 TeCO2e per £1m turnover. The types of GHG emissions included in the intensity ratio are scope 1 & 2 from energy consumed within the organisation.

As with all of our environmental impact targets, we report data against a baseline year of 2015.

In 2016 we saw a 1.5% reduction in scope 1 GHG emissions. For scope 2 emissions, there was a 6.1% reduction in 2016 compared to 2015. This was largely due to a new bio-gas engine at our Gouda manufacturing site in the Netherlands being brought online, coupled with continued good performance of our landfill gas combined heat and power plant at Atlas Point in North America. Our Cikarang manufacturing site in Indonesia has also made a contribution to reducing our scope 2 emissions by converting its steam raising boiler from light fuel oil to natural gas. 

Changes in total GHG emissions (TeCO2e):

  2015 2016
Scope 1 130,492 128,550
Scope 2 71,727 67,350
Scope 3  583,140  596,330
Total 785,359 792,230

Gas included is CO2. The baseline year data is 2015 for the current five year target period and is recalculated when we acquire or shed sites. Emissions factors are calculated using the GHG Protocol and International Energy Agency’s published conversion factors and the methodology used is as per GHG Protocol Corporate Standard. Manufacturing sites and non-manufacturing sites which we have financial control of are included.

Partial Reporting

Our primary focus is on reducing our direct CO2 outputs. We do, however, continue to monitor and set targets to reduce our Volatile Organic Compound (VOC) emissions. We are currently ahead of our target to reduce total Group VOC emissions by 10% by the end of 2020, after an 11.4% reduction in VOCs in 2016. We measure VOC at the ten manufacturing sites where it is a material issue for us.
Other significant emissions (kg):

Other significant emissions (kg):

  2015 2016
VOCs 157,163 139,191

We do not measure persistent organic pollutants, hazardous air pollutants or particulate matter because we emit zero ofrvery negligible amounts at our manufacturing sites so it is not considered material.

We are no longer reporting NOx and SOx emissions as these are included in our Scope 1 - Scope 3 GHG emissions as CO2 equivalents.

In 2015 we set a target to reduce Group water withdrawal by 10%, based on 2015, by the end of 2020. We have acheived a 4.8% reduction in water consumption in 2016 as detailed in GRI Specific Disclosure 303-1.

Our compliance with effluent discharge consents was better than ever in 2015 at 99.83% and there remain only four sites that have occasional issues with waste water, usually down to external factors such as weather. Therefore, in 2016 we took the decision not to continue with effluent discharge compliance as a public target. Internal monitoring continues to maintain tight control of our effluent treatment plants.

Total volume of planned and unplanned discharges (m3):

  2015 2016
Effluent discharged directly to river 6,290,125 5,996,557
Effluent discharged to local biological treatment works 1,155,547 1,208,714
Total discharged 7,445,672 7,205,271

Data reported quarterly by manufacturing sites and is taken from utility company invoices or from direct reading. Compliance of samples analysed and results are compared against consent limits issued by local regulators for those manufacturing sites which have a permit to discharge. Due to the timing of this report, water discharge from our Incotec manufacturing site has not been included.


We recognise that the deposition of waste to landfill is not sustainable, permanently modifying land and potentially introducing contamination to both air and water. In 2016 we set a target to reduce Group waste to landfill by 10% by the end of 2020. As of the end of 2016 we are on target to acheive our 2020 plan having acheived a 2.5% reduction in waste to landfill during the year.

Total waste by disposal method (tonnes):

 
2015
2016
Total landfill waste
2,106
2,053
Total incinerated waste
5,099
6,116
Total other waste disposal routes     22,336
26,709
Total recycled or recovered     19,202
17,971
Total waste   48,743
52,849

Non-hazardous waste by disposal method (tonnes):

 
2015
2016
 Landfill waste
 1,828
 1,740
 Incinerated waste
2,049
2,419
 Other waste disposal routes
21,062
25,410
 Recycled or recovered
15,827
15,879
 Total non hazardous waste
40,765
45,448

Hazardous waste by disposal method (tonnes):

 
2015
2016
 Landfill waste
278
313
 Incinerated waste
3,050
3,697
 Other waste disposal routes
1,274
1,299
 Recycled or recovered
3,375
2,092
 Total hazardous waste
7,976
7,401

Method of disposal determined either directly by audit or provided by the waste disposal contractor. We do not dispose of waste by composting, reusing or on-site storage. Data reported for manufacturing sites only, excluding our Incotec manufacturing site, due to the timing of this report.

Details on how we are tackling the issue of landfill waste can be found on page 14 of the 2016 Sustainability Report.

There were no significant or reportable spills across all of our operations in 2016.

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