Smart Science to Improve Lives™
Croda International Plc.
We are the name behind the high performance ingredients and technologies in some of the biggest, most successful brand in the world; creating, making and selling speciality chemicals that are relied on by industries and consumers everywhere.
We have four market sectors: Personal Care, Life Sciences, Performance Technologies and Industrial Chemicals. Within these four market sectors, we have nine business areas, each working in partnership with our customers to design ingredients that are manufactured globally and sold directly to our customers.
Personal Care:
Markets
Focusing on ingredients for skin, hair, sun protection and colour cosmetic products.
Products
These include inorganic UV absorbers, lanolins, emollients, polymers, proteins, surfactants and skin care actives. Read more at www.croda.com
Life Sciences:
Crop Protection:
Markets
We provide inert ingredients and adjuvants for the full spectrum of agrochemical applications.
Products
These include polymeric surfactants, dispersants, wetting agents, emulsifiers, stabilisers, adjuvants and seed coating binders. Read more at www.croda.com
Health Care:
Markets
Our high purity ingredients are used in the pharmaceutical, dermatological, neutraceutical, functional food and animal health markets.
Products
These include concentrated omega fatty acids, ultra pure medical grade lanolins, Super Refined™ excipients and a wide range of surfactants, solubilisers, emulsifiers and fatty acid esters. Read more at www.croda.com
Seed Enhancement:MarketsProtecting and stimulating seeds using processes such as seed priming, upgrading, disinfection, pelleting, encrusting and film coating. Incotec, a division of Croda, has the ability and technology to improve and enhance the quality of seeds and to apply seed treatment products.
Products
These include film coat liquids and coating products. Read more at www.croda.comPerformance Technologies:
Smart Materials:Markets
We supply speciality additives for polymer applications such as slip, anti-block, torque release and anti-scratch. We also innovate for niche segments within adhesives and sealants, paints and coatings, composites, engineering plastics, foams and elastomers.
Products
This includes a wide range of naturally derived oleochemicals and speciality surfactants. Read more at www.croda.com
Energy Technologies:
Markets
We supply marine, wind turbine and environmentally acceptable lubricants, as well as products for use in oil & gas production, e.g. flow assurance.
Products
These include demulsifiers for the oil field industry, friction modifiers, emulsifiers and other speciality surfactants www.croda.com
Home Care:
Markets
We supply ingredients for laundry, household, industrial and institutional cleaning applications, as well as for wipes, tissues, nappies and hygiene articles.
Products
These include proteins and their derivatives, softeners, surfactants, solvents, emulsifiers, solubilisers, hydrotropes, tissue lotions, botanical extracts, fatty acids and glycerine. Read more at www.croda.com
Water Treatment:
Markets
We deliver innovative surfactants for use in the manufacture of water soluble polymers as well as other chemistries for the water treatment industry.
Products
Our broad portfolio includes emulsifiers, defoamers, inverters, corrosion inhibitors, dispersants and lubricants. Read more at www.croda.com
Industrial Chemicals:
Markets
We supply ingredients and additives for use in a range of market applications including rubber, candles, textiles, leather and surfactants.
Products
These include the full range of our products; from base oleochemical fatty acids and glycerine to esters, polymeric surfactants and amides. Read more at www.croda.com
As a business to business organisation we strive to maintain an awareness and conformance, where appropriate, to national and local laws and voluntary codes or guidelines, from entities such as the Food and Drug Administration (FDA), the European Food Safety Authority (EFSA), the European Commission, Cosmetics Europe, United States Environmental Protection Agency and Personal Care Products Council (formerly CTFA).
We were a signatory to the chemical industry’s voluntary agreement on the accelerated phase out of the supply and use of products for applications restricted under the EU Marketing and Use Directive, which is now incorporated into our activities under the legislation of Registration, Evaluation, Authorisation and Restriction of Chemical substances (REACH). We therefore focus our sales and marketing on offering alternatives with just small amounts being imported for merchanting purposes' into allowed uses. For example, manufacturing of alkylphenol ethoxylates in our European operations is restricted and we are actively developing and promoting alternatives to alkylphenol ethoxylates in other regions. As a result many customers have already moved to different products.
Our corporate headquarters are located at Cowick Hall in East Yorkshire, England.
We are a global organisation with 4,580 employees across 38 countries. * The strength of our research, development and manufacturing capabilities is underpinned by our global network of sales offices and technical/customer support teams.
This report covers the sustainability performance of Croda International Plc for the period 1 January 2018 to 31 December 2018. 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
Countries of Operation*
| Western Europe | Eastern Europe, Middle East & Africa | North America | Latin America | Asia Pacific |
|---|---|---|---|---|
| Belgium | Czech Republic | Canada | Argentina | Australia |
| France^^^ | Hungary | USA^^ | Brazil^ | China^ |
| Finland | Poland | Chile | Hong Kong | |
| Germany | Russia | Colombia | India^ | |
| Italy^ | South Africa | Mexico | Indonesia^ | |
| The Netherlands^^ | United Arab Emirates | Peru | Japan^ | |
| Spain | Iran |
Singapore^ | ||
| Sweden | Malaysia |
South Korea | ||
| Turkey | Taiwan | |||
| United Kingdom†^^^^ | Thailand | |||
| Denmark | Vietnam |
Key
† Head Office
^ Manufacturing site
* As at 31 December 2018
Croda International Plc. is a Public Limited Company; we have been listed on the London Stock Exchange since 1964.
The ownership structure and major shareholders can be found in the Annual report.
The markets served by our business can be found under disclosure GRI 102-2. The revenue generated during 2018, separated by region is detailed below:
- Europe, Middle East & Africa - £572.4m
- North America – £372.7m
- Latin America - £141m
- Asia Pacific – £300.8m
Meanwhile, the breakdown of revenue and operating profit during 2018, separated by market sector, was as follows:
Personal Care:
- Revenue = £487.8m
- Operating Profit = £160.3m
Life Sciences:
- Revenue = £324.5m
- Operating Profit = £95.8m
Performance Technologies:
- Revenue = £456.4m
- Operating Profit = £85.2m
Industrial Chemicals:
- Revenue = £118.2m
- Operating Profit = £1.2m
As recorded at 31 December 2018, the Group employs 4,580 employees worldwide, with 72 operations including 19 manufacturing sites in 38 countries. Our revenue for continuing operations was £1,386.9m.
During 2018, our net sales revenue by market sector was:
- Personal Care – 35.2%
- Life Sciences – 23.4%
- Performance Technologies – 32.9%
- Industrial Chemicals – 8.5%
During 2018, our net sales revenue by geographic market was:
- Europe, Middle East & Africa - 41.3%
- North America - 26.9%
- Asia Pacific - 21.7%
- Latin America - 10.1%
At 31 December 2018, total debt was £425.5m and £998m equity.
These figures apply to Croda International Plc. in its entirety.
Further information can be found on in our Annual Report.
Like all successful businesses, we recognise that our future depends on our ability to attract and retain individuals who are passionate about personal and business growth and want to make a significant contribution to the future of our business.
| 2017 | Full Time | Part Time | Permanent | Temporary |
|---|---|---|---|---|
| Male | 64% | 1% | 65% | 2% |
| Female | 28% | 6% | 32% | 1% |
| 2017 | Western Europe | Middle East and Africa | Asia Pacific | North America | Latin America |
|---|---|---|---|---|---|
| Male | 34% | 1% | 18% | 10% | 3.5% |
| Female | 18% | 2% | 6% | 4% | 3.5% |
Most of our business is completed by employees of the business, who are therefore not self-employed or contractors. Our employee numbers do not fluctuate significantly throughout the year due to seasonal variations. For those employees on a temporary contact, many within this group are undergraduate interns or apprentices to whom permanent employment is normally offered upon successful completion of a training period.
There are a total of 19 manufacturing sites located in Europe, North America, South America and Asia. Each site/region has its own procurement organisation responsible for all aspects of procurement associated with acquiring all goods and services. Specific responsibilities include identification of requirements, specifications, assessment of risks, management of tendering processes, ordering, contract award and management and monitoring of suppliers' performance.
There are sales offices and warehousing in 38 different countries. Sales offices source materials from the worldwide network of manufacturing sites for customers in their local markets. The global supply chain is supported by a common SAP-based ERP processes.
Following six years of collaboration to develop specific applications for skin care, hair care and crop care, in January 2018 we acquired Nautilus, a technology-rich marine biotechnology company based in Charlottetown, Prince Edward Island, Canada. In March 2018 we acquired Plant Impact, an innovative crop enhancement business that uses chemistry and novel molecule discovery to identify ways to improve the yield and quality of crops by stimulating or moderating plant responses in both healthy and stressed crops. In late December 2018 we acquired Biosector, a vaccine adjuvant specialist and natural extension to our existing pharmaceutical excipients portfolio.
There have been no substantive changes in location of and relationships with suppliers in 2018. However, European chemicals raw material production is continuing to migrate to other regions offering the twin benefits of lower cost production allied with fast-growing consumer markets. In order to uphold the security of supply of raw materials, European sites increasingly must look further afield for reliable sources of chemical feed stocks.
The effective management of our risks and opportunities helps to achieve our strategic objectives, protects our people, our local communities and our reputation, and demonstrates good corporate governance. It is essential for creating and protecting value for our shareholders and customers in line with our business model. Croda is committed to the effective management of key business risks throughout the organisation.
The Board of Directors determines our overall risk appetite. It also oversees the group’s risk management and internal control systems, defines risks and monitors risk exposures and ensures that the nature and extent of the risks we take align with our strategic objectives.
The group coordinates its global approach through the Risk Management Committee of the executive which reports directly to the board via the audit committee. The Risk Management Committee is chaired by the group finance director and meets quarterly, with the VP risk and assurance in attendance at each meeting. The Risk Management Committee is responsible for the group’s generic risk framework, which requires each location to identify location specific risks against over 50 generic risks across six categories:
- People
- Process
- External Environment
- Business Systems and Security
- Strategic
- Financial
The framework is applied at market sector, regional, functional, manufacturing site and sales site levels. Senior management teams at each level are responsible for scoring and applying the classifications within the framework. These registers are reviewed and consolidated to ensure that there is a comprehensive view of the material risks facing the group, along with the controls in place to mitigate these risks. As a minimum, our market sectors, regions and core functions update their registers twice per year.
Our safety, health, environmental and quality (SHEQ) risks, which are closely aligned to several of our material areas are reviewed and considered by a dedicated executive level committee. This meets quarterly to consider the results of assurance audits over SHEQ controls and to monitor defined and agreed key performance indicators.
It is the responsibility of the Risk Management Committee to consider external and emerging risks and their relevance to the group; assess bottom-up risk registers to identify group wide impacts and trends and to compare them with key risks, and evaluate whether any risks have escalated and require further attention. Its quarterly meetings feature a presentation by the executive member responsible for ensuring best practice and continuous progress for each key risk. This covers the risk itself, the mitigating controls, and continuous improvement actions.
The review of our risk framework is ongoing as our business changes. As a result of our risk review throughout
2018, several of our key risks were elevated as a result of increased political and economic uncertainty, especially around the US/China trade relationship, and the focus on digital strategy opportunities. With the completion of the biggest capital investment in Croda’s history, the bio-surfactants plant in North America, the risk of major capital project failures is reduced (and has been removed from our key risks). The short-term risk of major safety and environmental incident has been increased as that site moves into business as usual operation.
Our cross functional Brexit project team was formed in April 2016 to monitor and review the implications of the result of the UK referendum to leave the EU (“Brexit”) on our strategy, business model and operations both within Europe and globally.
The team developed a Brexit risk register using the risk framework that considered not only the immediate potential for disruption between Europe and the UK across all our generic risk categories. It also considered the global implications on the movement of people and products, our trading model, innovation partnerships, reported results, cash and financing, customer service and supply chain, and the regulatory framework.
The project team conducted scenario analysis to assess the impact of individual risks and combination of risks. The register was reviewed by the board and the risk management committee, who received quarterly updates on the progress of review, design and implementation of mitigating controls.
As the probability of a hard Brexit (without a transition agreement recognising the existing trading rules) increased, the Risk Management Committee approved the acceleration of the project team’s contingency plans, with the primary objective of ensuring the continuity of the European business across the whole business model. Customer communication packs were developed for the sales teams summarising our preparations and updates continue to be posted on our website.
More information about the group’s risk management processes can be found on pages 38-43 of the 2018Annual Report.
Our proactive approach to working with many external organisations, both inside and outside of our industry, saw us contributing to around 190 different bodies during 2017. Many of these relate to product, personal and process safety and regulatory affairs.
Charters
Responsible Care
We are signatories to Responsible Care®, which is the chemical industry’s global voluntary initiative through which companies, through their national associations, work together to continuously improve their health, safety and environmental performance and to communicate with stakeholders about their products and processes. The Responsible Care® ethic helps industries to operate safely, profitably and with due care for future generations. It was commended by UNEP as making a significant contribution to sustainable development at the World Summit on Sustainable Development in 2002.
Roundtable on Sustainable Palm Oil (RSPO)
We have been active members of RSPO since it was established in 2004, and sit on the Derivatives Working Group. The mission of RSPO is to advance the production, procurement and use of sustainable oil palm products through the development, implementation and verification of credible global standards and the engagement of stakeholders along the supply chain. We are members of the RSPO, which collectively brings oil palm growers, oil processors, food companies, retailers, NGOs and investors to work together towards a global supply of palm oil that is produced in a socially and environmentally responsible way. The Roundtable promotes palm oil production practices that help reduce deforestation, preserve biodiversity, and respect the livelihoods of rural communities in oil-producing countries. It ensures that no new primary forest or other high conservation value areas are sacrificed for palm oil plantations, that plantations apply accepted best practices and that the basic rights and living conditions of millions of plantation workers, smallholders and indigenous people are fully respected.
12 Principles of Green Chemistry
The 12 Principles of Green Chemistry were developed in 1991 by Paul Anastas and John C. Warner. The aim of the principles is to minimise the environmental impact of chemical products and reduce the environmental and social risks of these products. We have been using these principles since 2010 to ensure that our New Product Development follows a more sustainable and environmentally friendly path.
We are a signatory to the Responsible Care® Initiative of the chemical industry trade associations in the UK, USA and Singapore, and more recently have endorsed the Global Charter agreed amongst the members of the International Council of Chemical Associations. We have also demonstrated our commitment to Sustainable Development by endorsing the principles developed in cooperation with stakeholders and member companies of the Chemical Industries Association.
In addition to this, we are also members of around 220 industry associations including (but not limited to):
American Association Of Pharmaceutical Scientists
American Board Of Industrial Hygiene
American Chemical Society
American Chemistry Council
American Cleaning Institute
American Institute Of Chemical Engineers
American Management Association
American Oil Chemists' Society
American Payroll Association
American Society For Testing And Materials
American Society For Testing And Methods
American Society Of Mechanical Engineers
Argentina Chamber Of Cosmetics And Perfumery Industry - CAPA
Argentinean Association Of Cosmetic Chemists - AAQC
Assic - Associations Of Trading Chemicals Industries
Association Francaise Des Techniciens Des Peintures, Vernis, Encred, d'Imprimerie, Colles Et Adhesifs (AFTPVA)
Association Of Accounting Technician (AAT)
Association Of Chartered Certified Accountants (ACCA)
Association Of Russia
Australian Society Of Cosmetic Chemists
Beauty Industry West (BIW)
Biobased Delta
Biobased Performance Material Project
Board Of Certified Safety Prof
Bombay Chambers Of Commerce
British Chamber Of Commerce
Canadian Association Of Chemical Distributors (CACD)
Canadian Cosmetic Toiletry And Fragrance Association (CCTFA)
Catalan Chemical Industry Federation (FEDEQUIM)
Chamber Of Commerce Clinton
Chartered Institute Of Management Accountants (CIMA)
Chemical Cosmetic Association
Chemical Industries Association
Chemical Industries Association (CIA)
Chemical Industry Council Of Delaware
Chemicals Northwest
Chemistry Council Of New Jersey
Chicago Paint & Coatings Assoc
Chilean Association Of Cosmetic Chemists
Colombian Association Of Cosmetic And Technology (Accytec)
Confindustria - Unione Industriali
Consumer Specialty Products Association
Coschem
COSMED (L’association De La Filière Cosmétique)
Cosmetic Executive Women
Cosmetic Valley
Cosmetic, Toiletry & Fragrance Association Of South Africa (CFTA)
Council For Responsible Nutrition
Council Of Producers And Distributors Of Agrochemicals
Delaware State Chamber Of Commerce
Deltalinqs
Dubai Chamber Of Commerce
Dutch Building Services Knowledge Centre (ISSO)
Dutch Polymer Institute
Entreprises Et Environnement
Enviromental Conservation Association Of Shiga Prefecture
Environmental Assessment Working Group
European Oleochemicals And Allied Products Group (APAG)
European Union Chamber Of Commerce In Korea
Federation Of Enterprises In Beauty – France (FEBEA)
Federation Of Indian Chambers Of Commerce And Industry (FICCI)
Federchimica
Federsalus
Formualted Products Industry Coalition
Global Organisation For EPA And DHA
Hair Science CHEMISTS OF JAPAN
Higashiohmi Chamber Of Commerce And Industry
Higashiomi Fire Desaster Prevention Association
Hull & Humberside Chamber Of Commerce
Human Management Association (ACRIP)
Humberside Chemical Focus
ICIS CHEMICAL BUSINESS AMERICAS
Indian Chemical Council
Indian Specialty Chemicals Manufacturers Association
Innovation And Chemical Industries In Sweden
Institute Of Chartered Accountants In England And Wales (ICAEW)
Instituut Maatschappelijke Innovatie
International Fish Meal And Fish Oil Organisation
International Pharmaceutical
Jababeka Investor Forum
Japan Chemical Industrial Association (Japanese Organization Of ICCA)
Japan Cosmetic Suppliers Association
Japan Hygienic Olefin And Styrene Plastics Association
Japan Hygienic PVC Association
Japan Oil Chemisits' Society
Japanese Cosmetic Science Society
Japanese Society For Cutaneous Health
Japanese Society Of Tribologist
Kashi-Kai
Kinki Cosmetic Material Association
Korea Chemicals Management Association
Korea Cosmetic Association
Korea International Trade Association
Korea Pharmaceutical Traders Association
Lipidforum
Margarine, Fats And Oils Association In The Netherlands (MVO)
Mase
Mexican Institute Of Chemical Engineers (IMIQ)
Mutual Aid Response Group
National Association Of Manufacturers Of Paints And Inks - Mexico (ANAFAPYT)
National Association Of The Chemical Industry - Brazil (ANIQ)
National Industry Association (ANDI)
National Lubricating Grease Institute
National Plastic Industries Association - Mexico (ANIPAC)
Natural Resources Stewardship Circle (NRSC)
Nederlandse Vereniging Voor Verf Technici (VVVF/NVVT)
New Castle County Chamber Of Commerce
New Jersey Chamber Of Commerce
New Jersey Institute Of Technology (NJIT)
New Jersey Society Of Cpas
National Fire Protection Association (NFPA)
Netherlands Group of Users of Technology for Separation (NL Guts)
North Central Weed Science Society
PA Chamber Of Business
Pennsylvania Chemical Industry
Perfumery And Cosmetics
Personal Care Products Council
Peruvian Association Of Cosmetic Chemists
Peruvian Association Of Textil Technicians
Pharmacopeia
Professional Association Of Industrial Plastics Of Chile (ASIPLA)
RAL For Phase Change Materials
Roundtable For Sustainable Palm Oil
Rutgers CCB
Scancos (Scandinavian Cosmetic Association)
Seong Nam Chamber Of Commerce & Industry
Sepawa (Soaps, Perfumes And Detergents)
Singapore Chemical Industry Council
Société Française De Cosmétologie
Society For Human Resource Management
Society Of Cosmetic Chemist
Society Of Cosmetic Sciences (SCC) - New York, Quebec And Toronto Chapters
Society Of Plastics Engineers
Society Of Tribologists And Lubrication Engineers
Society Of Tribologists And Lubrication Engineers (STLE)
South African Paint Manufacturers Association (SAPMA)
Spanish Association Of Manufacturers Of Surface Active Substances For Applications (AEPSAT)
Technical Symposium
Thane Belapur Industries Association
The Ceramic Society Of Japan
The Chemical Industry Association In Germany (VCI) Via TEGEWA
The Chemical Industry Association In The Netherlands (VNCI)
The Confederation Of Indian Industry (CII)
The European Federation For Cosmetic Ingredients (EFFCI)
The Japanese Dermatological Association
The Lock Haven Rotary Club
The Pharmaceutical Society Of Japan
The Society Of Cosmetic Chemists Of Japan
The Society Of Petroleum Engineers
Tokyo Chamber Of Commerce And Industry
Tokyo Cosmetic Material Association
Toronto North CAER Group
Trans Thane Creek Waste Management Association
Turkish Chemical Industry Assocciation
Turkish Paint Industry Association
Union Des Industrie Chimiques
West-Japan Cosmetic Industry Association