Mitigating climate change and promoting the circular economy
We live in a world on the brink of collapse.
The climate crisis cannot be considered a subordinate priority, and at Ferrer we are well aware of this.
We are therefore committed to being a carbon-positive company as far as our Greenhouse Gas (GHG) emissions.
We have also publicly announced our decarbonisation targets through the Science Based Targets initiative (SBTi): Ferrer has committed to reducing its direct emissions by 50% and its indirect emissions (which account for 85% of overall emissions) by 25%.
In addition, the «Ferrer carbon-positive: one step beyond zero emissions» strategy is structured around 6 main commitments:
Liveable Planet Goals
At Ferrer we want to guarantee a habitable planet for everyone
Are you aware of our commitments?
Commitment 1: We make a commitment to science
In our firm commitment to reducing our greenhouse gas emissions, validated and approved by Science Based Targets, in 2022, we have made progress as a company on several key aspects related to our climate strategy.
Some of our most noteworthy initiatives include:
For the second consecutive year, we attended the United Nations Climate Change Conference (COP27) in Egypt, participating in numerous sessions of the summit, where experiences from the scientific community and best practices from other companies were shared, which provided us with an opportunity validate and align our climate strategy.
We have worked on defining our climate change governance model in order to improve our climate strategy and involve the necessary people from each department in the implementation of our Climate Transition Plan.
To ensure that Committee members have climate change skills, in 2023 we will run a training course for the entire leadership team on how to effectively implement a decarbonisation strategy in the company from an operational and financial perspective.
This year, we have also updated our analysis of climate risk impacts and opportunities in line with the recommendations set out by the Task Force on Climate-Related Financial Disclosures (TCFD).
We have used the results of this analysis to identify the risks with the greatest impact and highest probability of occurrence in the short and medium term for inclusion in Ferrer’s corporate risk map.
We have also continued to work on raising awareness of the various issues associated with climate change and how these affect human beings.
A good example of this type of activity was the Agora Talk* held in July in collaboration with Oxfam Intermón to discuss the concept of Climate (IN)justice, a term used to draw attention to the ethical and political conflict derived from the negative effects of climate change on people, which goes beyond being an environmental or physical challenge in nature.
* internal chat open to everyone in our Agora space at the head office
As a result of all the initiatives we carried out in 2022, we have been able to greatly increase our performance in several of the categories analysed by the Carbon Disclosure Project (CDP) index, a global benchmark in the processing of data on climate change management, which classifies companies according to their commitment to reducing their GHG emissions and measuring the environmental impact of their actions.
We have achieved a «B” or “Management» category in the CDP Climate Index, reflecting our internal efforts to review, plan and take coordinated action on managing the climate impact of our business.
For more information on our assessment you can see details of our 2022 result here.
For Ferrer, it is of vital importance to reduce Scope 3 emissions, which also accounted for more than 80% of our total GHG emissions in 2022.
In fact, as a result of all the efforts dedicated to the climate management of indirect emissions generated by our suppliers, in 2022 we obtained the category of «Leaders in the CDP’s Supplier Engagement Rating», which focuses on how effectively companies are engaging and working with suppliers to address climate change issues.
For more information on our assessment you can see details of our 2022 result here.
In the coming year, we will continue to work to improve our climate performance in order to become a leader and achieve “A” status in the global CDP Climate Index.
To this end, we will take the following actions:
Detailed economic study to prioritise the actions needed to achieve the objectives set out in the SBTi.
Implementation of an Internal Carbon Pricing system to decarbonise the investments to be made in the coming years.
We will continue to promote new initiatives in the programme to support suppliers in decarbonising their business activities, thereby reducing Ferrer’s Scope 3 emissions.
Evolution of GHG emissions in Ferrer
In 2022, we increased our carbon footprint compared to the previous year by 14%, which corresponded to a reduction in achievement of the SBTi target
This increase is mainly due to the investments made for the construction of two new production sites during 2022, and all the materials and machinery necessary for doing business in these two new locations.
It is worth noting, however, that, with respect to the base year 2019, we have reduced Ferrer’s overall carbon footprint by 10%, in line with our SBTi reduction targets, reaching 20% compliance with the target for direct emissions and 38% compliance with the target for Ferrer’s indirect emissions.
Likewise, the continuous increase in production at our chemical plant implies an increase in emissions derived from the consumption of Natural Gas, thus increasing our dependence on this fuel and the criticality of finding a more sustainable alternative fuel in the medium term.
For details of the evolution of our GHG emissions, please refer to the 2022 NFIS (non-financial information statement).
Commitment 2: Promoting the circular economy
In keeping with our commitment to the environment and to future generations, at Ferrer we are moving towards a production model based on the circular economy.
Our Packaging for Good programme
In the context of our commitment to the circular economy, since 2019 we have promoted various initiatives to encourage efficient consumption of the packaging materials we use in our products, in line with our sustainable packaging model, thus minimising their environmental footprint, in keeping with our Climate Change Policy, which aims to make us a carbon-positive company.
The goal is to reduce the carbon footprint of our packaging by 25% through eco-design and reduce that of the products we manufacture by 50%, by 2030.
The Sustainable Packaging model was implemented for the first time in 2020, and during 2022 we have carried out several initiatives to consolidate the project, the most noteworthy of which are:
We have trained more than 80 people at Ferrer who work in contact with our product so that they are familiar with the Sustainable Packaging Model and integrate it into their daily work.
In these training sessions, as well as being able to learn about the project in depth, participants were able to make proposals for improvement and initiatives to apply these sustainable packaging criteria to other products in the future.
Another of the aspects we worked on this year that is also key to the success of the project has been the co-creation of a process for the implementation of eco-design projects with all the areas involved in this process.
In this way, the roles and responsibilities of each area have been defined at the moment of executing a product eco-design,thereby integrating these tasks into the organisation’s existing processes.
In addition, to give continuity to the model and contribute to the strategic objective of ecodesigning 50% of our product portfolio by 2030, we have analysed the feasibility of implementing three new ecodesign projects in several of our products, carrying out an environmental, technical and economic feasibility analysis of the application of different ecodesign improvements.
The main strategies analysed for these three products are summarised below:
Another objective of our packaging model for 2030 is to eliminate deforestation from the production of our packaging by using Forest Stewardship Council (FSC) certified materials, which guarantees the sustainable management of the forests from which the raw materials for the manufacture of these materials are obtained along the entire value chain.
Currently, the degree of use of FSC materials in relation to purchasing units in 2022 is 67%, and we expect to be able to increase this to 80% by the end of 2023.
Another of the initiatives implemented in 2022 was to carry out a market study to explore existing sustainable packaging alternatives.
The purchasing area conducted a survey of the group’s main suppliers and came up with more than 13 viable initiatives for the transition to sustainable packaging.
With this information as a starting point, a report of eco-design proposals was drawn up, which forms the roadmap for the project in the coming years.
Hence, in order to share our model with other companies, in 2022 we participated in the Pharmaceutical Manufacturing & Packaging Congress in Berlin, where we presented our packaging model with case studies of projects that we had carried out, as well as in the Hispack congress in Barcelona, where we discussed the transformation of packaging towards more sustainable models with companies such as Danone, The Body Shop and Quadpack.
By 2023, we want to extend these sustainable packaging criteria to as many of the products in Ferrer’s current and future portfolio as possible.
Therefore, we will analyse for the first time the feasibility of implementing an eco-design strategy for the primary blister packaging of one of our products
Our Waste Management Programme
Continuous improvement in our production processes is paramount when we work on reducing the waste derived from our activity.
We strive every day to implement measures that will transform us into a Zero Waste To Landfill (ZWTL) organisation by 2030.
To achieve this, we have developed a waste management plan that seeks efficiency in waste treatment, avoiding landfill as the final destination.
Here are the key considerations underlying these initiatives:
Strengthen the training of key actors in order to establish specific responsibilities in the different centres and carry out specific training on the actions to be implemented.
Dissemination and communication programme.
Adapt all spaces intended for waste management.
Ensure the correct sorting of waste.
Generate alliances with waste managers and other entities related to the promotion of the circular economy and the final management of waste.
Optimise the final management of waste, through monitoring focused on continuous improvement.
Always with reduction in mind, the success in achieving the Zero Waste to Landfill target is based on minimising waste generation.
Much of the waste we generate in our operations derives from the production of the active ingredients and medicines we put on the market.
We are therefore focusing our efforts on achieving a high recovery rate for this waste in order to make a significant contribution to the creation of a circular economy.
Thanks to these efforts, we achieved an overall recovery rate of 84.6% of all waste generated by the end of 2022.
If we analyse these results in more detail, we can see that our logistics centre has already achieved the desired goal of recovering 100% of the waste generated, and that our production plant for pharmaceutical specialities is very close to the desired goal, with an 89.9% recovery rate.
Commitment 3: Energy decarbonisation
Our energy efficiency programme is the backbone of the energy decarbonisation of our production and operations centres, since it helps us to turn our commitments into actions that reduce the greenhouse gas emissions linked to our activity.
We cannot avoid energy consumption, but we act to make it as efficient and environmentally friendly as possible.
During 2022, in Ferrer we have implemented several projects that have contributed to reducing energy consumption in the different centres, as well as the emissions derived from this consumption:
100% renewable electricity with the purchase of Renewable Energy Certificates (RECs), in line with the goal of achieving a 100% renewable energy supply by 2025
All the electricity used by Grupo Ferrer Internacional, including its subsidiaries, is renewable, and the consumption of non-renewable energy in countries where a renewable supply does not exist is offset by the purchase of Renewable Energy Certificates (RECs). This has saved more than 7,500 tonnes of CO2 equivalent per year.
Energy efficiency programme in keeping with our commitment to reduce energy consumption by 10% (electricity, steam and diesel) by 2025
At the Sant Cugat Pharmaceutical Production Centre, we have implemented the following strategies and initiatives:
- Modification and adaptation of 2 existing Industrial Cold Water circuits.
- Replacement of a refrigeration unit with another unit that uses refrigerant with low climate change potential.
- Optimisation of air conditioning, compressed air and electricity services during non-productive hours.
The following measures have been carried out at Sant Cugat Chemical Plant:
- Modification of ethylene glycol distribution and improvement of network control.
- Own production of nitrogen, achieving self-sufficiency and reducing the environmental impact associated with the purchase of this raw material.
Monitoring of plant consumption and automation of alerts in the event of increased consumption.
LEED Gold Certification Plan for the different facilities with a surface area greater than 1000m2
In order to achieve this objective, several of our centres included in the scope are currently in the process of obtaining the certificate. This includes the Barcelona headquarters, the new pharmaceutical production centre in Esplugues de Llobregat and the R&D centre in California.
One of the centres that obtained the certification in 2022 is our centre in Mexico, where the services of our subsidiary in this country are located.
Now that Mexico has joined the total number of certified centres, 65% of the total surface area of our sites is certified as a guarantee of an environmentally friendly building model aligned with Ferrer’s values.
Likewise, for our Chemical Plant in Sant Cugat we carried out a feasibility study in 2022 to implement LEED certification. All non-industrial buildings with a total surface area of 4,188m2 were included.
Now that the study has been carried out, the next steps are yet to be defined in order to achieve certification of the centre in the coming years.
Solar panel projects in the different centres
In order to increase the consumption of renewable electricity produced at our centres, in 2022 we carried out several studies to analyse the feasibility of installing solar panels at our main operational centres. We expect that these panels will be installed in all our centres in the coming years
Total energy consumption increased by 1.8% compared to the previous year due to increased production at our chemical and pharmaceutical plants.
Below is a breakdown of the organisation’s energy consumption by source:
Commitment 4: Promoting sustainable mobility
For us, sustainable mobility is crucial to contributing towards the reduction of the carbon footprint and the preservation of the environment. It also significantly improves people’s quality of life and reduces traffic in cities, making them more sustainable and accessible for future generations.
In 2022, we have implemented the following sustainable mobility initiatives:
In line with our goal of achieving 100% electric vehicles by 2030, we have already converted 20% of the fleet to electric power and, in 2023, we will also focus on reducing the fuel consumption of these vehicles through a programme to raise awareness and support efficient driving in the commercial network.
With regard to the emissions of the commercial network, we have replaced all 320 vehicles with much more fuel-efficient models that generate 15% less CO2 emissions, thus reducing these from 146 grams. CO2/100 km to 125 grams/100 km.
We have installed a total of 55 electric chargers in Ferrer’s centres in order to facilitate the charging of the electric fleet.
We have implemented a 100% flexible work model that corresponds to the needs of the company’s different profiles, which has allowed us to reduce the impact derived from the travel of the people who work at Ferrer by 20% in keeping with the Sustainable Mobility Plans in force in the different centres and countries where we operate.
In 2023, we will continue implementing initiatives to promote the sustainable mobility of Ferrer’s employees, as well as new initiatives to work on other relevant categories of impact, such as the logistics and distribution of our products in all the regions where we are operate.
We want to bolster our logistics emissions reduction programme as a continuation of the project carried out in 2021.
Moreover, we intend to opt for adoption of recognised standards in sustainability and efficiency in logistics operations such as, for example, Lean & Green certification, as well as to analyse the feasibility of implementing the use of sustainable fuels in our operations.
Ferrer Costa Rica: Committed to the sustainability of our fleet
As part of the commitment to reduce our carbon footprint, Ferrer Costa Rica has joined the initiative launched by Ferrer Portugal in 2021, and 7 electric vehicles have been assigned to medical staff in that country.
Until now, this group has been the biggest generator of greenhouse gases in Ferrer Costa Rica.
This decision has been well received by the team because, in addition to reducing the carbon footprint of the subsidiary and benefiting the planet, it is an initiative that positions Ferrer as one of the pioneering companies in the use of ecological alternatives.
Commitment 5: Supply chain partnerships
On average, supply chain emissions are 5.5 times higher than the companies’ operational emissions. We are fully aware that we will need the commitment and collaboration of key actors in our supply chain in order to achieve the 2030 emission reduction targets based on our SBTi goals. In this way, supplier engagement will be a key element in achieving our Scope 3 emission reduction targets, regardless of whether we have a supplier engagement target.
In knowledge of this situation, at Ferrer we have drawn up our Decarbonisation programme with suppliers, which was created as a result of the Supplier’s for Good project, a global framework for ESG management that we work on with our suppliers.
In 2022, we developed the standards on which we intend to build our decarbonisation programme with suppliers.
It is based on the following aspects
We also understand that simply asking suppliers to reduce emissions or make environmental sustainability commitments will not lead to the rapid transformation and change required to achieve our targets, so we have also defined the mechanisms that we will use to accompany our suppliers in the form of a programme that supports the real decarbonisation of their activities.
Within this programme we prioritise the way in which we want to work with out suppliers, distinguishing 4 possible types of accompaniment:
Awareness-raising
Massive accompaniment programme for those suppliers that are less significant in terms of our Scope 3 emissions and over which we cannot exert much influence.
We seek to raise awareness among these suppliers through dissemination and awareness-raising initiatives so that they bring their activities into line with our Race to Zero strategy and with a world aligned with the SBTi.
Buscamos poder sensibilizar a estos proveedores de tal modo que se estén alineados con nuestra estrategia de Race to Zero y con un mundo alineado a los SBTi a través de iniciativas de difusión y sensibilización.
Using our leverage to encourage suppliers to take action
Programme to support and define real and effective decarbonisation strategies for those suppliers that have a medium or high level of significance in our Scope 3 emissions and over which can exert a certain amount of influence so that they take action.
We want to accompany these suppliers in calculating their emissions (if they do not already do so) and in defining their action plans to reduce them in the coming years.
Generating Impact
Support programme for those suppliers that are highly significant to our Scope 3 emissions and over which we exercise a high amount of leverage to make them grapple with their climate action plan.
We want to work hand in hand with them to detect very concrete potential actions that will greatly incentivise the decarbonisation of the products or services they supply to us.
Queremos trabajar de la mano con ellos para detectar posibles acciones muy concretas que incentivaran en gran medida la descarbonización de los productos o servicios que nos suministran.
Colaboración
Support programme aimed at suppliers who are already well established in the climate management of their activity and who can also be a rich source of inspiration for the rest of the suppliers included in the programme.
The aim is to give recognition and benefits to these suppliers, who are key players today and contribute greatly to reducing our Scope 3 emissions.
During 2023, we will continue to work to implement this initiative while providing our internal teams with the necessary training and knowledge to implement the programme effectively, and we will always implement these reduction plans from the perspective of collaborating with and supporting our suppliers in making improvements.
Commitment 6: neutralisation of emissions
Our climate strategy focuses on actions to decarbonise our business, both by reducing our direct emissions and also all emissions generated over the course of our entire value chain.
Nevertheless, we are also well aware that any economic activity will always be linked to a certain impact on the planet.
We therefore want to focus not only on reducing the emissions we generate, but also on helping to develop carbon capture projects, which will help us achieve our goal of being a carbon-positive company in the future.
In 2022, we defined our emissions neutralisation strategy, which includes the following fundamental elements:
Continue decarbonising our business in line with the Net Zero concept developed under the Science Based Targets Initiative (SBTi).
In order to make a rapid contribution to the challenge of keeping global temperature increase below 1.5°C, we will offset our direct emissions (which represent 15% of the total) by 2030 through projects that prevent carbon emissions into the atmosphere or through nature-based solutions, such as reforestation, or carbon capture by employing new agricultural techniques.
Running parallel to these projects, our Climate Transition Plan includes actions to reduce both direct and indirect emissions.
From 2030, we aim to achieve a 95% reduction in total emissions from our activity compared to the baseline year (2019).
Once we have reached our target, the 5% of emissions that we have not been able to eliminate will have to be offset by carbon capture/neutralisation projects.
Furthermore, in line with this emissions neutralisation strategy, by 2022 we had offset 7,500 tonnes of direct carbon emissions through two projects:
Piedra Larga Wind Farm
This project aims to generate renewable electricity in Mexico through the construction and operation of a 90 MW wind farm in the municipality of Unión Hidalgo, in the State of Oaxaca.
This project results in an increase in the percentage of renewable energy in the Mexican grid, thereby promoting the growth of renewable capacity and diversifying the Mexican power generation mix, all of which contributes significantly to the sustainable development of the region.
Evio Kuiñaje Ese Eja Cuana
Located in the Amazonian Madre de Dios region of Peru, the country’s most biodiverse region, this project aims to conserve community forests and prevent their licensing for use in the face of rapidly increasing deforestation.
The project proposes to reduce the pressure to change land use in the project area through the promotion of sustainable economic activities, forest governance, and the establishment of conservation agreements in previously identified critical areas.