Responsible corporate governance Archives

Reforestation at the Grundfos Székesfehérvár site

Biodiversity, Climate protection and adaptation, Corporate strategy, Employee well-being, Reduction of air pollution, Responsible corporate governance, Stakeholders, local communities

“Sustainability has always been a matter of the heart for Grundfos and is one of our core values. Therefore, we strive to pioneer solutions to the world’s water and climate challenges and improve people’s quality of life. This corporate goal is an integral part of our daily operations. The reforestation project at our Székesfehérvár site serves these goals, and following the principle of ‘think globally, act locally,’ we aim to do more for sustainability by building on local opportunities and needs.”
Olivér Szundy, Country Director / Csaba Udvar, Managing Director of the Székesfehérvár plant

Company Name:

Grundfos Hungary Manufacturing Ltd.

Implementation Year:

2022-2024

Focus Areas :

Climate Protection, Climate Adaptation, Air Pollution Reduction, Biodiversity, Employee Well-being, Stakeholders, Local Communities, Responsible Corporate Governance, Corporate Strategy

Program Objective:

The primary goal of the reforestation project implemented on a 4000 m2 area is to locally reduce CO2 emissions in the immediate vicinity of emissions. Expert estimates suggest that after 20 years, we can achieve approximately 25 tons of CO2 savings. In addition, improving the air quality in the industrial park environment and increasing biodiversity are also objectives.

Additional Goals:

Reducing noise and pollution from road traffic.
Mitigating north-northwest winds.
Returning a piece of nature to what the factory occupies.

Program Measures and Commitments:

In 2022, Grundfos initiated the biodiversity program at its Székesfehérvár plant, which will conclude in 2024. A crucial goal was to give back a piece of nature from what the factory occupies. Besides preserving and increasing biodiversity, a significant sustainability goal is to reduce CO2 emissions, which reforestation substantially contributes to on a 4000 m2 area. It’s worth emphasizing that this wasn’t merely tree planting, but a complex creation of a new ecosystem that will become self-sustainable in the long run, requiring no special care or intervention as this function is returned to nature.

Key steps and milestones:

The first step was selecting the area, designated or taken from the factory’s green areas, for the project.

The project creation was supported by a diverse team of experts, from facility management to environmental, health and safety personnel, and HR, ensuring that all necessary aspects are incorporated and applied during the program’s design and operation.

In addition to colleagues, it was essential to involve external experts, including cooperation with the Székesfehérvár City Maintenance, Vadex Mezőföld Forest and Game Management Ltd., and the University of Western Hungary.

The project concept was developed, followed by obtaining permits locally and globally.

After procurement, soil tests and preparation of the loess soil were carried out. The expertise of foresters in suggesting suitable tree species for the specific area and climatic conditions was crucial. In the end, around 3000 plants were planted, including field maple, Turkestan pear, wild pear, sessile oak, common oak, and, for the forest edge, hawthorn from domestic shrubs.

Post-care is crucial, and this will be carried out by local forestry experts under a 3-year framework contract.

In the future, we plan to establish a recreational park and communal space on the site for employees and company partners, thereby promoting the possibility of connecting with nature.

Program Impact and Results:

Key results:

Local capture of emitted CO2 on a 4000 m2 area.
Preservation and increase of biodiversity by planting 5 different tree species.
Avoidance of lawn mowing and fertilizer use to preserve the soil.
Climate adaptation – adapting to climate change (the forest has air-cleaning and cooling effects).

Keywords:

biodiversity, CO2, net zero, forest, Grundfos, climate change, climate adaptation

10.10.2023

Sustainability (ESG) performance measurement

Corporate strategy, Responsible corporate governance, Transparency

“At Grundfos, ensuring the complete and accurate provision of sustainability data and its integration into the company’s operational and performance measurement processes is of paramount importance to us. In 2022, we introduced Sphera Cloud, the new corporate sustainability software. This allows us to further enhance the completeness and accuracy of ESG data within a single platform.”
Károly Nyári, Group Vice President FP&A

Company Name:

Grundfos

Implementation Year:

2022 –

Focus Areas:

Transparency, Responsible Corporate Governance, Corporate Strategy

Program Objective:

Accurate measurement and reporting of environmental, social, and corporate governance (ESG) performance are critically important to Grundfos for various reasons.

External and internal stakeholders, regulatory requirements, monitoring of our strategy, and voluntary commitments increasingly require the collection, recording, and credible reporting of various performance indicators.

We needed a solution that would streamline data collection, storage, and auditability across a complex organizational structure and various maturity levels. Our goal is to ensure that the quality of our sustainability performance data matches that of our financial data.

Program Measures and Commitments:

ESG considerations have been an integral part of our company’s operations since its inception, starting with internal regulations defining the proportion of employees with disabilities and extending to the inclusion of sustainability indexes in our strategy starting in 2020, with total CO2e emissions becoming one of our TOP6 KPIs from 2023.

It’s becoming increasingly evident that the quality expectations for ESG data are catching up with those for financial data.

Considering this, most of the knowledge and experience reside within the financial organization, which also has the longest history of audit processes. Additionally, given the evolving EU regulations and the rise of integrated reporting, it makes sense to integrate and align ESG reporting processes with existing financial reporting.

Improving data quality presents the biggest challenge, and there’s much experience and benchmarking to draw upon within the financial organization.

Within the Financial Planning & Analysis (FP&A) department of the Financial Directorate, a Sustainability Finance team was established with a central hub in Hungary. Team members bring different expertise and organizational backgrounds, providing significant advantages in shaping complex processes.

Taking into account existing and anticipated requirements, as well as internal ambitions, we initiated development efforts on multiple fronts. Besides introducing technical solutions that meet data collection requirements, we also started building related processes, with a particular focus on control processes and their proper documentation.

An increasing portion of the organization is getting involved in the new processes, so significant attention must be devoted to training and development for participants to better understand and comprehend the data they work with.

Given the size and complexity of the dataset, we need simple technical solutions to visualize performance and make tracking easier for decision-makers.

Program Impact and Results:

We introduced the SPHERA system, which enables unified data collection from all locations. We established a system for key performance indicators (KPIs) and data hierarchy. We also developed a Sustainability Scorecard Power BI report and the related reporting process towards top management and the Sustainability Council.

For our 2022 sustainability report, we achieved a “reasonable” level of assurance for energy consumption, water intake, Scope 1 and Scope 2 CO2e data, and a “limited” level of assurance for the entire report and remaining indicators.

Keywords

Data Collection, Sustainability Performance Measurement

10.10.2023

BÉT ESG Services for SMEs

Corporate strategy, Responsible corporate governance Financial services

“ESG compliance is increasingly becoming a competitive factor, even for small and medium-sized enterprises. Budapest Stock Exchange, as a central player in the Hungarian capital market, considers supporting the domestic SME sector as one of its key sustainability efforts. Companies participating in our programs can familiarize themselves with corporate solutions aligned with sustainability goals and the background of ESG challenges. Additionally, they receive tailored ESG advisory services.”
Richárd Végh, CEO

Company Name:

Budapest Stock Exchange

Implementation Year:

2021-

Focus Areas:

Responsible Corporate Governance, Corporate Strategy

Program Objective:

It is increasingly evident that investors seek to prioritize environmental consciousness and social values in their investments. The adoption of ESG principles is also gaining momentum in Hungary.

Hungarian SMEs need solutions to enhance their competitiveness and contribute more effectively to sustainable development and increase their ESG readiness.

With our supported ESG services, we aim to help improve the competitiveness of SMEs and prepare them for ESG.

Program Measures and Commitments:

Following extensive market consultation, we released the ESG Guide in 2021. While primarily aimed at stock exchange issuers, it is accessible and applicable to any Hungarian company or consultant. The guide provides fundamental knowledge about ESG concepts and principles, steps in preparing sustainability reports, regulatory aspects, reporting standards, and rating systems.

Starting in 2022, the Budapest Stock Exchange initiated government-supported ESG training programs. As the executor of a training program that supports increased contributions to sustainable development goals and ESG readiness, we were designated.

Under the “ESG Training Program,” we supported SMEs in their ESG preparedness by providing ESG training offered by pre-accredited ESG trainers.
The ESG pilot advisory program demonstrates how the aspects of the Budapest Stock Exchange’s ESG methodology can be incorporated into the reporting processes and underlying operations of specific companies. This involves preparing businesses for sustainability and ESG mindsets and identifying necessary adaptation steps.

In December 2022, we completed an ESG methodology specifically designed for SMEs. We identified 30 environmental, social, and corporate governance performance indicators that most organizations are likely to provide for assessment and are expected to best align with market expectations. This enables organizations to determine whether their ESG readiness is at an entry, intermediate, or advanced level.

To enhance the understanding, interpretation, and application of ESG regulations in Hungary, we continuously organize professional forums, workshops, conferences, either independently or in cooperation with other organizations.

Program Impact and Results:

A total of 181 small and medium-sized enterprises participated in our ESG training program.

Surpassing initial expectations, 39 SMEs successfully applied for our ESG pilot advisory program. These SMEs not only gained the opportunity to participate but also secured European Union GINOP and KMR support totaling nearly HUF 475 million for covering advisory costs.

Keywords:

ESG, training, advisory, reporting, guide

10.10.2023

Reforestation at the Grundfos Székesfehérvár site

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Sustainability (ESG) performance measurement

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BÉT ESG Services for SMEs

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Program Measures and Commitments:

Program Impact and Results:

Related Links:

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