3Sustainability

Datwyler is aware of its social and environmental responsibility and pursues a sustainability strategy with twelve focus topics. These are structured according to the globally recognized ESG concept (Environmental, Social and Governance). Each topic bundles activities related to current and future projects and contains clear responsibilities with measurable targets and quantifiable key figures for effective management.

In recent years, corporate sustainability has gained significantly in importance, especially for listed companies. The primary driver has been the increasing global risk of climate change, which has been playing a major role in politics and society.

In 2021, Datwyler established an ESG landscape with twelve focus topics that embody the company’s commitment to reducing its environmental footprint and delivering more value for all stakeholders. The focus topics are structured according to Environmental, Social, and Governance (ESG) priorities and are intended to close gaps and build on existing strengths.

A strong governance framework is key to ensuring that the sustainability (ESG) strategy Datwyler has committed to is incorporated into the corporate agenda.

The governance of sustainability (ESG) is integrated into the corporate governance structure throughout the Group – from Board level to management level, Group functions, Business Units and all associates.

Critical concerns include concerns about the organization’s potential and actual negative impacts on stakeholders raised through grievance mechanisms and other processes. They also include concerns identified through other mechanisms about the organization’s business conduct in its operations and its business relationships.¹

Energy management at the production sites is part of the integrated Environmental Management System (EMS) and is part of the Datwyler Production System. A global Sustainability Manager coordinates the energy management across all plants and is supported by a dedicated EHS officer at each individual plant.

Datwyler commits to a far-reaching climate target for its operations: climate-neutral operations by 2030. The SBTi offers a 1.5°C reduction pathway to calculate Datwyler’s «fair share» in reducing carbon emissions in order to help achieve the 1.5°C level. The overall reduction pathway offers guidance for Datwyler on the reductions needed to reach this goal by 2030 and beyond.

The main goal is to reduce greenhouse gas emissions as much as possible by 2030. The so-called non-avoidable emissions will be offset after 2030 in order to achieve climate neutrality for the company’s operations. Datwyler is aware that the greenhouse gas emissions outside its operations—so-called Scope 3 emissions—exceed the greenhouse gas emissions of its own operations.

Datwyler has been recording the energy consumption and greenhouse gas emissions caused by its own operations for many years. The results of the last five years are shown in the accompanying table.

The five-year track record reveals an increase in energy consumption mainly resulting from business growth, new plants and acquisitions.

In 2022, Datwyler’s operations were responsible for emissions of about 90'478 tons CO₂eq (scope 1 and 2)— the increase of 15.8 % compared to 2021 is due to the acquisitions of QSR and Xinhui. Thanks to the measures implemented to improve energy efficiency and the switch to renewable electricity, relative CO₂ emissions have decreased by 4.7% compared to 2021.

Datwyler’s corporate processes are based on its production system and internationally recognized quality management standards. For example, plants making products for the automotive industry are certified in accordance with IATF 16949:2016, while healthcare plants (with the exception of the US plant in Pennsauken) have ISO 15378:2017 certification.

Almost all Datwyler Group products are subject to statutory information obligations in the countries of use, in addition to a variety of chemical law requirements and additional industry and customer-specific rules at its production locations. Chemical legislation and EU REACH regulations regarding the physical composition of products are particularly relevant. REACH (EU Regulation 1907/2006) governs the registration, assessment, and approval of chemical substances within the European Union.

Eco-design principles offer a critical perspective when developing products that reduce the environmental impact across all its life cycle stages. Datwyler’s successful approach to eco-design optimizes the environmental performance of its products while also maintaining their functional qualities. This includes developing environmentally friendly elastomer compounds, optimizing design to save on materials, reducing process-related waste, and using reusable or recyclable packaging and boxes. But eco-design is more than simply reducing the environmental footprint of a product: this holistic approach helps developers think through social benefits and reconsider economic factors at the same time.

Recently, Datwyler launched an action plan that will guide the company through the next few years of integrating eco-design systematically across product development and across all life cycle stages of a product. Datwyler successfully implemented the «Idea Box» tool where ideas and initiatives from employees have been selected from a development team to initiate concrete projects aimed at minimizing the ecological impact in different areas.

Material deveopment is an area in which Datwyler has the most control over new materials. Researching new materials not only involves assessing the cost, manufacture, and performance of the final product, but also its environmental impact, from the sustainability of the raw materials to the compostability and overall recyclability of the component.

Datwyler is currently working on a number of projects that could reduce the requirement for fossil fuels in the elastomer manufacturing process. These projects include replacing an oil-based polymer with a polymer made from sugar cane, using a plasticizer based on vegetables rather than petroleum oil, replacing plastic-based fibers with modified cellulose, and many more.

The Datwyler Production System, which is based on the company values and lean principles that guide Datwyler employees, is a long-term improvement program to foster a lean and agile culture and achieve operational excellence. As a shared program for continuous improvement, this system supports uniform production processes across all plants on all continents. For Datwyler, the quest for operational excellence means not only a safe workplace, high-quality products, on-time deliveries, and satisfied and empowered employees, but waste-free processes and environmental protection as well. This makes reducing the consumption of resources and protecting the environment an integral dimension in the pursuit of operational excellence.

Within the Datwyler Production System, a certified and integrated Environmental Management System (EMS) provides the basis for optimizing resource use. This EMS aims to minimize the impact of the company’s operations and products on the environment by designing and manufacturing products and processes that use natural resources sustainably and reduce the company’s carbon footprint. A global sustainability manager coordinates the environmental management across all sites and is supported by site EHS officers.

Most of Datwyler's total water consumption is attributable to the specific requirements of its production processes. Both the cooling systems used in the Food & Beverage division's production and the washing of components in the healthcare sector require significant amounts of water. Specifically, approximately 35% of Group-wide water consumption occurs at the Swiss plant.

The long-term target (2015 to 2025) to reduce relative water consumption per revenue unit by 3% each year is based on this general condition. Over the last seven years, this target has been exceeded on average. In 2022, the absolute water consumption was 8.8% higher than in the previous year. This is due to the acquisition of new sites. Nevertheless, Datwyler is in line with its long-term water reduction targets. Absolute water consumption was reduced by nearly a fourth between 2016 and 2022—from 2.1 million m³ to 1.7 million m³.

Ultimately, Datwyler wants to empower employees to create value for customers, the company, themselves, their local communities, and the entire planet. The company promotes equal opportunities, equal treatment, and fair conditions of employment. It focuses particularly on talent and internal leadership development, prioritizing the development of agility and entrepreneurial initiative in every employee.

Management at Datwyler is based on concrete and inspiring objectives, which are broken down and assigned to the various levels within the hierarchy. The company uses the concept of Objectives and Key Results (OKR) for this purpose. For each selected objective, several key results and related activities are defined that are specific, timebound, and challenging in order to foster thinking and acting on what matters most. For each key result, there is a responsible person who coordinates the alignment of activities to meet the objectives at all hierarchical levels and in all units of the company. Activities are regularly reviewed and adjusted if necessary, and the objectives and key results are transparent and observable by all employees. In this way, Datwyler delegates responsibility for achieving goals to volunteers across the full organization, promotes its network cooperation and increases entrepreneurial initiative and customer focus across the business.

Datwyler is creating an environment for agility to be lived in everyday life and for employees to make full use of their talents, skills, and creativity. To this end, the company offers its leaders targeted training that helps them to create a culture where everybody feels appreciated, respected and empowered for who they are and for what they do. The company’s internal WeLead program—a series of seven training initiatives, each with its own learning objectives leading to different, yet aligned results—is the basis for its systematic talent management and the foundation to apply appropriate leadership styles in a VUCA (volatility, uncertainty, complexity and ambiguity) world.

In 2022 Datwyler further improved the talent and succession management formally introduced in 2020. Involving top leaders, more than 10 conferences have been held on site, in Business Units/Areas and with the Management Board.

Talents have been assessed, identified and discussed for Key positions to safeguard succession planning. Common criteria on assessing employees’ potential and the use of reliable and valid assessment-methodologies contribute to the Diversity, Equity and Inclusion principles.

Datwyler envisions becoming a self-learning organization and invites everyone to become the best version of their true self. For Datwyler, learning and development is one of the cornerstones to cultivate the culture and learning mindset necessary to sustain that vision. In 2022, Datwyler has agreed on their learning and development strategy which will help to focus and prioritize their actions.

Updated pay philosophy and global job architecture

The payphilosophy supports the four core values of the Datwyler Group:

• We are entrepreneurs.

• We excel at what we do.

• We bring value to our customers.

• We have respect for others.

It was updated in 2022, where Datwyler successfully conducted a job architecture and grading project within the full group. It was the very first time that all the functions were assessed around the globe on common standards. It was another step forward to increase equity and fairness – internally and externally. For 2023, implementation of the new grading country by country will be one of the core tasks in the field of HR.

Datwyler has zero tolerance for discrimination, humiliation, oppression, harassment, or insults relating to anyone’s gender, origins, nationality, culture, religion, or color. This is clearly laid down in the Code of Conduct, with punishments ranging from sanctions to dismissal.

Datwyler’s Diversity Council, which was established in 2021 based on the DEI policy, had six meetings in the course of the year 2022. The diverse team including the CEO developed the following vision statement for the Council: «Our vision is to create an inclusive culture, where all of us can flourish – and build a sustainable future, together.». The council analyzed the as-is situation in various fields of DEI, initiated projects to improve the status quo e.g. in the field of gender diversity, which were included in the OKR system. So tangible progress has been achieved in the field of female employees in management positions, where the quota increased from 18.3% to 19.4%.

No claims of potential discrimination within Datwyler companies were received in 2022.

Employees who are happy, motivated, and willing to accept change are the backbone of a company because they work hard. They should make up a substantial proportion of the workforce. To measure employee satisfaction and engagement on a range of parameters, Datwyler regularly conducts a comprehensive employee survey, most recently in 2020 for the full group. The next survey takes place in January – February 2023.

The slogan #FOR YOU serves as an umbrella for a range of benefits and initiatives at Datwyler that support employees and make them feel valued. The program is constantly growing and organized around five pillars:

1. Health

2. Well-being

3. Work environment

4. Ideas/involvement

5. Personal development

With more than 100 years of experience and a global production footprint, Datwyler’s material, engineering, and production expertise helps make it a market leader for system-critical elastomer components. Efforts to constantly improve allow the company to continually expand its innovative portfolio of products and services.

Datwyler is increasingly marketing its ambitious sustainability strategy and how it can add value to customers. All global customer-facing teams are trained on Datwyler’s sustainability program and encouraged to always include sustainability in the value proposition presented to customers. It doesn’t matter if it is during a 30-minute call or three-day workshop, one of Datwyler’s main customers or a new lead, a multinational or a small start-up company. It is Datwyler’s explicit goal to encourage sustainability-related collaborations with customers to maximize impact.

Datwyler uses the results of customer surveys and complaints management to identify and implement measures for improvement. These are part of the systematic management process and thereby help ensure the service customers receive keeps on getting better. For example, Datwyler uses Tech Days on site with existing and potential customers from the Mobility business unit to strengthen relationships and raise awareness of its competencies and offerings. Doing business with Datwyler must be simple for existing and potential customers.

Datwyler supports its local communities not only through wages and tax payments, but also through donations, volunteering and engagement, education, and improvement of local infrastructures.

As a large regional employer, Datwyler’s bigger sites generate considerable direct and indirect economic benefits for the local area. Municipalities benefit not only from the tax paid by Datwyler companies and its employees. Also the community projects that every site runs locally make a positive difference. As a guideline for community projects, Datwyler explicitly focuses on activities in the area of education, critical human needs, and inclusion of minority groups.