In 2024, we developed a robust framework to manage greenhouse gas (GHG) emissions both at a Group and a wider SHV level. This framework reflects our commitment to mitigating climate change and addressing the associated risks and opportunities.
We are in the process of updating our climate strategy taking into account CSRD requirements. The process is being led by the Groups and focuses on delivering actual emission data, abatement levers and abatement initiatives – including related investments and operational costs. In 2024, we reported Scope 1 and Scope 2 emissions in line with previous years.
SHV reports GHG Scope 1 and Scope 2 emissions in accordance with the GHG Protocol Corporate Standard. Scope 1 emissions include direct emissions from sources either owned or controlled by the company, such as facilities and vehicles. Scope 2 covers indirect emissions from purchased energy, including electricity, steam, heating, and cooling. Calculations are based on actual activity data in addition to emission factors derived from recognized databases, including the Department for Environment, Food and Rural Affairs (DEFRA) and the International Energy Agency (IEA). We apply Global Warming Potentials (GWPs) in accordance with Intergovernmental Panel on Climate Change (IPCC) guidelines.
In the latest reporting period, Scope 1 and 2 emissions amounted to 566 kton and the development from 2022 onwards is as follows:
The last three years have seen a reduction in emissions driven by factors such as switching to green electricity purchasing, electrifying our vehicle fleet, and the partial replacement of diesel with Hydrotreated Vegetable Oil (HVO). In 2024, we achieved a significant reduction in GHG compared to 2023. This was mostly thanks to Nutreco, which maximized the purchase of green electricity, began the switch away from heavy fuel use in Ecuador, and launched a broad portfolio of energy efficiency projects across its operations. Throughout the year all Groups paid significant attention to increasing energy efficiency as part of ongoing operation, maintenance and investment reviews.
We have not yet established Paris Agreement-aligned GHG reduction targets across the three emission scopes. Nevertheless, emission reduction is viewed as a vital strategic matter – especially Scope 3, which represents over 95% of SHV emissions. These arise from the activities of assets that SHV does not own or control, but indirectly affects through our value chain. We are working ever more closely with suppliers and service providers to improve transparency in the value chain and drive joint reduction of GHG emissions.
Based on the DMA, from an inside-out perspective, our operations contribute to climate change, making the reduction of GHG emissions critical. From a financial outside-in point of view, climate-related risks such as regulatory changes, carbon pricing, and shifting consumer preferences represent significant factors that exert a significant influence over our business strategy. We will develop our climate strategy to address these specific challenges while making the most of opportunities to innovate and build resilience.
By maintaining the highest standards of transparency and accuracy in our GHG disclosures, we will ensure that stakeholders, including investors, regulators, and the wider community, are proactively and transparently informed of our climate-related impacts, risks, and performance.
Our approach to aligning with the EU Taxonomy is based on complying with the CSRD as well as making a meaningful contribution to EU sustainability objectives. The EU Taxonomy serves as a classification system to define and promote sustainable economic activities. As such, it aims to steer investments and resources toward initiatives that align with ESG goals.
We follow the technical screening criteria established by the EU Taxonomy to determine the environmental sustainability of our activities. This includes assessing the contribution of our operations against one or more of the six environmental objectives outlined in the Taxonomy Regulation: climate change mitigation; climate change adaptation; the sustainable use and protection of water and marine resources; the transition to a circular economy; pollution prevention and control; and the protection and restoration of biodiversity and ecosystems. Each of these objectives is systematically evaluated to ensure that our activities make a significant positive contribution without denigrating other environmental objectives and while remaining compliant with minimum social safeguards.