WELCOME CEO statement 2019 Dear reader, Following the success of last year’s leaner and more concise CSR Report, this year’s addition will keep the same format, with longer form pieces being made available on our website and through our LinkedIn company page. This report still informs you of our CSR strategy, focus areas and related activities in the reporting year according to the GRI standard. 2019 was a significant year for Palsgaard. We were able to publicly celebrate achieving our milestone of CO₂-neutrality across our production sites, the news of which was met with great interest from both the food manufacturing industry, and the wider international business community. Our experience and lessons from reaching this feat have been shared at numerous industry events, and we hope they will help and inspire other organisations to take similar steps in the near future. This achievement was also recognised by industry peers when we were awarded the prestigious “Sustainability Champion Award” at the 2019 Food Ingredients Europe (FIE) trade event in Paris. Also, our Mexican subsidiary was awarded with the ESR Trophy 2019 for their outstanding performance in CSR. Our continuous focus on energy savings and optimisations at our production sites has successfully resulted in meeting strategic reduction goals for 2020 for water consumption and we have reduced energy consumption by 5% on a global scale. We are great believers in taking action and responsibility whereever possible, and will continue to focus on this area. In the coming period, we will be setting ourselves new, ambitious climate impact goals, and it is our intention to further invest significant capital into developing our reliance on green energy and solutions across both our production units and administrative workspaces. Further supporting the rights of our employees, we have introduced a Whistle-blowing Policy and implemented an Ethics Hotline which enables all employees and stakeholders to anonymously report any perceived violations they may experience throughout our supply chain. Employee well-being and motivation continues to be a priority for Palsgaard – and 2019 saw us take further steps in this area by focussing on employees’ mental health with a new Stress Policy. The results from our internal Employee Motivation and Satisfaction survey produced the best rating ever. We have achieved a level of 78, where the benchmark is 73. This is of course extremely pleasing, however, we are also aware that there are areas to improve in ensuring both blue and white collar employees are thriving equally in their work environment. Palsgaard has been a UNGC signatory since 2011, having committed to adopting the ten UNGC principles in our strategy, culture and day-to-day operations. By valuing transparency and accountability to our stakeholders and the world, we have committed to reporting annually on our progress. There will be more CSR opportunities awaiting - it is an everlasting journey and with the strong backing of our company's dedication to local communities, we will continue to take part in further addressing the sustainability challenges of the world. Employee safety maintains a high priority across Palsgaard. During 2019 a number of new initiatives were started and communication around the topic was increased significantly. Prioritising this area has reaped satisfying results, with a significant reduction in the number of work-related accidents at our largest site in Denmark. Anders Brix Group CEO Schou Foundation Palsgaard 30 April 2020 Jakob Thøisen CEO Palsgaard A/S Palsgaard 30 April 2020 Our journey to the 2020 targets Figure 1 Core CSR figures and targets CO2-emission (kg CO2 per kg finished product) Energy consumption (gross) (kWh per kg finished product) Water consumption (l per kg finished product) Accident frequency (per million working hours) Target 2015 2016 2017 2018 2019 2020 0.12 0.12 0.11 0 0 0 1.34 1.27 1.21 1.12 1.07 1.05 3.52 3.74 3.36 3.34 2.92 3.17 18 13 20 11 9 3 5
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