Novo Nordisk A/S – Annual report – 31 December 2020
Strategic Aspirations — Purpose and sustainability (extract)
Consolidated statements – ESG statement / Additional information (extract)
Statement of environmental, social and governance (ESG) performance (extract)
Notes to the consolidated ESG statement (extract)
Basis of preparation
General reporting standards and principles
Novo Nordisk’s annual reporting complies with the Danish Financial Statements Act. Sections 99a, 99b and 107d specify the requirements of the EU Directive on disclosure of non-financial and diversity information to report on the management of risks related to the environment, climate, human rights, labour and social conditions, anti-corruption and gender distribution. These requirements are addressed in the Management Review. Novo Nordisk also adheres to the International Integrated Reporting Framework and the AA1000AP(2018), which states that reporting must provide a complete, accurate, relevant and balanced picture of the organisation’s approach to and impact on stakeholders and society.
Novo Nordisk is an active member of the world’s leading circular economy network, the Ellen MacArthur Foundation.
As recommended by the Task Force on Climate-related Financial Disclosures (TCFD), Novo Nordisk is working to integrate two climate change scenarios into the risk management process to identify short, medium and long-term risks within our production and supply chain:
– 2⁰C scenario, consistent with meeting the Paris Agreement Goal (Representative Concentration Pathway RCP 2.6)
– 4⁰C scenario as an alternative high-emission scenario (RCP 8.5)
Novo Nordisk discloses in accordance with the recommendations put forward by the Carbon Disclosure Project (CDP). For a full breakdown of climate and water impacts, please refer to the publicly available report of Novo Nordisk CDP disclosures.
Novo Nordisk applies AA1000AP(2018) as a component in creating a generally applicable approach to assessing and strengthening the credibility of the Group’s public reporting of ESG information. Novo Nordisk has designed processes to ensure that the qualitative and quantitative information that documents the ESG dimensions of performance is assured, as well as the systems that underpin the data and performance. The principles outlined in AA1000AP(2018) have been applied as described below.
As a pharmaceutical business with global reach, Novo Nordisk is committed to being accountable to those stakeholders who are impacted by the organisation. From the perspective of social responsibility, the key stakeholder groups are patients who rely on Novo Nordisk products, employees at Novo Nordisk and throughout the Group’s value chain, business partners and local communities. Novo Nordisk maps its stakeholders and has processes in place to ensure inclusion of stakeholder concerns and expectations. In addition, Novo Nordisk continuously develops its stakeholder engagement and capacity to be a sustainable business at corporate, regional and affiliate levels. See how Novo Nordisk defines what is meant by sustainable business in ‘Purpose & sustainability’.
Key issues are identified through ongoing stakeholder engagement and trendspotting, informed by data-driven analysis and addressed by programmes or action plans with clear and measurable targets. The issues presented in the Annual Report are deemed to have a significant impact on the Group’s future business performance and may support stakeholders in their decision-making.
The Annual Report reflects how the company is managing operations in ways that consider and respond to stakeholder concerns and interests. The report reaches out to a wide range of stakeholders, each with specific needs and interests. The Annual Report is prepared with investors in mind. To these stakeholders, however, as well as to the many other groups who may seek information in the Annual Report, this is just one element of interaction and communication with the company.
Understanding, measuring and communicating the positive and negative impacts on society and the environment of Novo Nordisk’s activities are important. Novo Nordisk is currently working on developing methodologies to be better able to do just that, covering the entire value chain.
The consolidated ESG statement is a result of assessing legal requirements and disclosure commitments applicable to Novo Nordisk. Whether information is tied directly or indirectly to Novo Nordisk’s ability to create value over the short, medium and long term is also assessed. When assessing whether a disclosure is material to include in the consolidated ESG statement, Management considers whether the matter is of such relevance and importance that it could substantively influence the assessment by providers of financial capital of Novo Nordisk’s ability to create value over the short, medium and long term. See more at novonordisk.com.
Principles of consolidation
The environmental disclosures covers the production sites, laboratories and offices with significant activities. CO2 emissions related to transportation cover cars leased or owned by Novo Nordisk, business flights and suppliers distributing Novo Nordisk products.
The social and governance-related disclosures cover the Novo Nordisk Group, comprising Novo Nordisk A/S and entities controlled by Novo Nordisk A/S.
The accounting policies set out below in the notes have been applied consistently in the preparation of the consolidated ESG statement for all the years presented.
Changes to accounting policies and disclosures
Children reached through the Changing Diabetes in Children programme (CDiC) has been added to expand disclosure to align with the Defeat Diabetes strategy.
Gender in the Board of Directors (BoD) (ratio men:women) has been added to expand on the diversity reporting.
[Note: the detailed notes to the ESG statement have not been reproduced in this extract]