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We take a clear stance on the issues that matter to you and society at large.

<h3>Our policies are central to everything we do, and through our position papers we strive to clearly state our official opinion on issues that our stakeholders find particularly important.</h3>

Explore Novonesis policies

Novonesis Animated Green Landscape

Policies are available on novonesis.com

Explore Novonesis position papers

<h4>Our opinion</h4>

<h2>Position papers</h2>

Novozymes strives to offer a clear opinion on issues that stakeholders find most important.

<h4>Novozymes position statement on animal testing</h4>

Novozymes’ goal is to eliminate the use of animal testing. But at present, animal testing is required by legal authorities as a precondition to product registration.

Novozymes uses animals for research, safety testing of products and for antibody production where no acceptable alternative methods exist. At present, legal authorities require animal testing as a precondition to product registration.

Our ultimate goal is to eliminate the use of animals and obtain safety measures by other means. We therefore find it important to continuously address the issues around the use of laboratory animals and to challenge the justifiability of this use. The need for data from animal testing should be questioned case by case.

In day-to-day business Novozymes:

<ol><li>Keeps a strong mindset on the principle of the three R's (replacement, reduction and refinement) and is actively investigating: 
	- Replacement of animal use by alternative methods, if applicable 
	- Reduction of the number of animals used where possible 
	- Refinement of methods to reduce pain and distress</li>
	<li>Assures compliance with Novozymes' policies through our internal Science Ethics Committee. No study involving animals can be conducted unless the protocol has been reviewed and approved by this committee.</li>
	<li>Requires that our suppliers (Contract Research Organizations) constantly consider and improve the animal welfare.</li>
	<li>Provides appropriate education to all Novozymes' employees involved in studies with animals, and upholds internal standards and procedures to ensure compliance and challenge the necessity for animal use.</li>
	<li>Engages in dialogue with key stakeholders.</li>
</ol>Last revised April 2021

Animal testing

<h4>Novozymes position statement on biodiversity</h4>

Novozymes’ products are based on technologies found in nature. Protecting biodiversity is important to our business, and we adhere to the UN’s Convention on Biological Diversity.

Biodiversity represents all living organisms surrounding us. It’s the diversity of animals, plants, and microbes as well as the variety of habitats and ecosystems on Earth. Nature and the natural ecosystems provide humanity with beneficial goods and services – the so-called ecosystem services. There are provisioning services like food, clean water, and raw materials. There are regulating services like climate regulation, pollination, and water regulation. There are cultural services like recreation and spiritual values. And finally, there are supporting services like photosynthesis and nutrient cycling that secure the basis for the other services. Biodiversity and the ecosystem services are essential for a healthy, sustainable and a well-functioning world.

Unfortunately, biodiversity and the ecosystem services are under pressure due to human activities. The loss of biodiversity in recent years is alarming, and scientists describe the current development as the sixth mass extinction and one of the most important environmental challenges.

<h4>The link to sustainable development and the SDGs</h4>

Biodiversity is an essential aspect of sustainable development, as a sufficient amount of biodiversity is a prerequisite for well-functioning ecosystem services that are vital for human well-being and sustainability. The conservation and sustainable use of biodiversity are addressed directly in the United Nations Sustainable Development Goals (SDGs) 14 (“Life below water”) and 15 (“Life on land”), but biodiversity is also indirectly necessary to achieve several of the remaining SDGs, e.g. 2 (“Zero hunger”), 6 (“Clean water and sanitation”), 12 (“Responsible consumption and production”, and 13 (“Climate action”).

Novozymes has embraced the SDGs in the core of the business to increase our positive world impact, and we acknowledge this often-overlooked interrelation between biodiversity, ecosystem services and sustainable development.

<h4>Novozymes and biodiversity</h4>

Biodiversity is a new focus area for the business sector, as companies try to understand their dependencies, impacts and responses related to biodiversity. Novozymes closely follows the developments in this area and regularly assesses how to incorporate best practice in our operations. Novozymes’ products, enzymes and microorganisms, are nature’s own technologies. Through so-called ‘bioprospecting’ Novozymes takes samples of fungi and bacteria in nature and use them to develop new biological solutions that help our customers improve their products and reduce their environmental footprint.

The United Nations Convention on Biological Diversity (CBD) is an international legal instrument for conservation and sustainable use of biodiversity. The objectives of the CBD include a fair and equitable sharing of the benefits arising out of the utilization of genetic resources. This is addressed in the Nagoya Protocol providing specific guidance on the principles of Access and Benefit Sharing (ABS) to avoid biopiracy of genetic resources.

Novozymes endorses the globally recognized principles in the CBD and ABS. As a part of our obligation towards the CBD, we only take samples in agreement with all relevant laws and regulations in the countries we operate in. In addition, we have stringent internal procedures including a database system for traceability of genetic resources to ensure that we live up to our commitments.

Last revised March 2021

Biodiversity

<h4>Novozymes position statement on biofuels</h4>

Novozymes supports the advancement of biorefining technologies through our continuous development of new biological solutions for the conversion of biological feedstock to useful products, including biofuels for the transportation sector. We support policies that drive decarbonization and sustainable energy. Policy development in this area should evaluate technologies and energy sources on a level playing field and full life cycle assessment basis.

Transport is one of the toughest sectors to decarbonize and no single technology can solve the problem alone. Bioethanol from starch crops, such as corn and wheat, is already displacing vast amounts of gasoline today, thereby reducing greenhouse gas (GHG) emissions substantially while simultaneously providing valuable protein-feed for livestock. The carbon footprint of US corn ethanol is about half the footprint of average gasoline and even lower for ethanol in Europe. This is considering all life cycle impacts, also impacts on land.

Novozymes provides biological solutions for the existing starch-based ethanol industry as well as for the emerging conversion of cellulosic biomass, like crop residues and municipal solid waste, to ethanol or biogas. Cellulosic technologies are being demonstrated by leading first movers in the industry today and stand ready to be deployed at large scale, provided there is adequate political will. Displacing gasoline with cellulosic ethanol has the potential to fully negate GHG emissions from fuel combustion.

Sustainable biofuels are the most impactful tool that near term can supplement the emerging electrification of light duty traffic and holds further potential to help decarbonize heavier transport modes, which are harder to electrify, like trucking, shipping, and aviation.

Biorefining has many synergies with other renewable technologies. Ethanol fermentation provides a clean stream of biogenic CO2 that can be captured at low cost and stored geologically to reduce atmospheric CO2 levels (carbon capture and storage). Captured CO2 can also be utilized in greenhouses, cooling systems, soft drinks, or as feedstock for so-called electro-fuels (‘power-to-X’). Leading players in the industry are already capturing CO2 today. Moreover, side streams from cellulosic biorefineries can provide storable fuels in terms of biogas and lignin, which can be used to stabilize electricity grids as these become increasingly based on intermittent energy sources like wind and solar.

Besides the synergies with other technologies, biofuels can help to ensure a just, green transition through job creation and additional revenues for rural economies. Biofuels can bring investments to the agricultural sector and stabilize agricultural markets by diversifying farmer incomes.

While biofuels are already applied at large scale today and hold further promise for the future, they also have limitations – just as other renewable technologies. Feedstock for biorefining always needs to be produced or collected in respect of people and planet and each nation needs to determine how to best and most effectively integrate biofuels in society. To that end, the Global Bioenergy Partnership (GBEP) has developed 24 indicators to facilitate the sustainable development of biofuels. In addition, multiple certification schemes exist to demonstrate the sustainability of specific biofuel pathways.

For further information, please see IEA’s <a href="https://www.ieabioenergy.com/wp-content/uploads/2017/11/Technology_Roadmap_Delivering_Sustainable_Bioenergy.pdf" target="_blank">Technology Roadmap: Delivering Sustainable Bioenergy</a> and Novozymes’ report <a href="https://nz.engage.novozymes.com/l/701243/2022-12-08/qtlrt/701243/1670559906SnpzUnQc/Novozymes_Briding_the_gab_to_a_sustainable_future.PDF" target="_blank">Bridging the gap to a sustainable future</a>.

Last revised May 2021

Biofuels

<h4>Novozymes position statement on anti-corruption</h4>

Corruption has a wide range of corrosive effects on markets and society in general. Accordingly, Novozymes has joined the United Nations Global Compact and supports working against corruption in all its forms.

As a global company with activities all over the world, Novozymes wants to show that it is possible to grow a healthy global business based on values such as responsibility, accountability, openness, and honesty. This way of doing business has characterized Novozymes for many years and will continue to do so.

To contribute to the fight against corruption, Novozymes has established seven principles which all employees, including executive leadership, and the board of directors must comply with:

<ol><li>Novozymes neither accepts nor offers bribes in any form</li>
	<li>Novozymes does not make facilitation payments</li>
	<li>Novozymes does not contribute to money laundering. All financial transactions must be documented</li>
	<li>Novozymes does not pay criminals for protection</li>
	<li>The value of gifts given and received must not exceed locally defined triviality limits</li>
	<li>Novozymes does not make financial contributions to political parties. Charitable contributions are subject to various restrictions</li>
	<li>In Novozymes, we avoid conflicts of interest. Private interests must not impact business judgement</li>
</ol>Novozymes maintains a web-based business integrity training program focusing on anticorruption, which is mandatory for relevant employee groups and management, and which serves as a frequent reminder of the rules everyone must follow to avoid bribery and corruption in the course of business. It guides the employees in making the right decisions through customized cases and dilemmas where engaging with third parties may represent a business integrity dilemma.

An employee code of conduct is available in seven languages, Chinese, Danish, English, French, German, Portuguese and Spanish. The code outlines responsibilities such as complying with anti-corruption laws and exercising good judgement.

All employees are strongly encouraged to seek guidance on ethical dilemmas from their manager as well as designated colleagues in finance, legal, compliance and local People &amp; Organization (HR). Further, employees and external stakeholders can anonymously raise any concerns about business ethics and corruption through <a href="https://novozymes.whistleblowernetwork.net/" target="_blank">Novozymes’ Whistleblower Hotline</a>, and they can refer concerns about behavior perceived to conflict with Novozymes’ values and policies to Novozymes’ Ombudsperson. All concerns raised will be handled appropriately in accordance with internal procedures.

Executive Leadership, the Board of Directors and the Audit Committee receive reporting on all whistleblower reports and fraud investigations on a quarterly basis. Novozymes reports on all investigations of fraud and corruption related matters in the annual report.

Anti-corruption

<h4>Novozymes’ position statement on climate change</h4>

Climate action is an integral part of Novozymes’ business strategy, and we are committed to a net zero future. Our ambitious climate commitment, Accelerate towards a climate-neutral society, launched under our <a href="https://strategy.novozymes.com/" target="_blank">refreshed strategy</a> as part of our commitments to a healthy planet, and it guides our approach to addressing climate change issues.

Many Novozymes’ biological solutions deliver climate benefits. And, we fully recognize the potential to grow our business while innovating transformative solutions for the climate. We have therefore decided to invest in strategic opportunity areas, including biological alternatives to synthetic fertilizers, carbon capture and advanced protein solutions.

We take relevant measures to address climate impacts across our operations and value chain, and we are committed to Science Based Targets. Through the application of our solutions, we enable our customers and end users to reduce their CO2 emissions. We believe that effective implementation of robust climate change policies and strong corporate actions will help provide a clear roadmap for businesses to drive the world towards a low carbon future. We have a tradition of integrated reporting and we continue to transparently disclose our climate change impacts.

<h5>Lowering Novozymes’ operational carbon footprint</h5>

Novozymes has invested significantly in energy efficiency projects and renewable energy to reduce CO2 emissions from its operations over the past decade, and continues to do so. We also pursue a strategy where we recover energy or heat from previous waste, and use biomass as a source for biogas production. The produced energy is either used at our sites, going into the grid or used in local communities.

We are committed to high standards and ambitious actions to improve our climate footprint across scopes 1, 2 and 3 with the aim of reaching net-zero by 2050. Our net-zero target has been validated by the Science Based Targets initiative. We are committed reduce absolute CO2 emissions  (from 2018 baseline) from operations by 75% and to reduce absolute CO2 emissions (from 2018 baseline)  from supply chain by 35%. 

<h5>Mitigating climate change impacts across the value chain</h5>

Novozymes conducts peer-reviewed cradle-to-grave life cycle assessment (LCA) studies to document the environmental impact of our solutions. These studies are used to keep our stakeholders informed and to demonstrate to our customers´ways to reduce their CO2 emissions and leverage the positive impact on climate change that Novozymes’ solutions can enable. Our published LCAs are available <a href="/en/sustainability/impact/our-library-of-life-cycle-assessments">here</a>.

We are working with our suppliers and further defining strategies to drive supply chain emission reductions (Scope 3). Our Scope 3 boundary is composed of purchased goods and services, fuel and energy-related activities, upstream transportation and distribution, waste generated in operations and business travel.

<h5>Enabling a low carbon future</h5>

Novozymes actively engages in global discussions, partnerships and advocacy for robust policy framework to decarbonize the global economy with key stakeholders. Here are some examples of Novozymes’ global advocacy for climate action:

<ul><li>In Denmark, Novozymes is part of the ‘Climate Partnership for Life Science &amp; Biotech’ whose aim is to give recommendations on how each industrial sector can contribute to reducing GHG-emissions and reach the Danish government’s target of reducing absolute GHG emissions by 70% by 2030, compared to 1990 levels.</li>
	<li>In the EU, through its representation in various industry organizations such as EuropaBIO, ePURE, EBIC, Novozymes supports the EU Green Deal, which articulates a roadmap for how Europe will live up to its ambitious climate commitments and make its economy circular, biobased and sustainable</li>
	<li>In the US, Novozymes has supported key climate legislation, such as the Renewable Fuel Standard (which pushes for higher blended volumes of renewable fuels in the fuel mix) and the Growing Climate Solutions Act (which will enable farmers to participate in carbon credit markets).</li>
	<li>In Brazil, Novozymes was a founding member of Association of Industrial Biotechnology (ABBI), which played a key role in establishing the <a href="http://www.fao.org/faolex/results/details/en/c/LEX-FAOC172738/" target="_blank">RenovaBio</a> program, which seeks to reduce the emissions intensity of the Brazilian transport sector in line with its commitment to the Paris Agreement.</li>
	<li>In China, Novozymes supports the overall objective of the clean energy strategy in the 14th National Five-year Plan, and advocate for more policy support and subsidies for the advanced bioethanol sector due to its contribution to China’s circular economy.</li>
</ul>We welcome opportunities to engage directly with governments and other key stakeholders to strengthen climate and clean energy policies and develop more ambitious Nationally Determine Contributions as part of their commitment to the Paris Agreement.

<h5>Transparent climate disclosure</h5>

At Novozymes, we recognize that improving climate-related disclosures can further help us to manage climate-related issues better and significantly impact decision-making in support of further resilient strategy setting and sustainable business continuity. We therefore strongly support the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD), and in alignment with these recommendations, we include climate-related disclosures in our integrated annual report. We also disclose climate change impacts through CDP annually.

Date revised January 2022

Climate change

<h4>Novozymes position on Gene Technology incl. Gene Editing.</h4>

As a world leader in biological solutions, Novozymes believes we have an obligation to further explore the role of biotech innovation to help people and animals live healthier lives on a healthier planet.

<h3>Technology and Product Scope.</h3>

Gene Technology comprises several different technologies developed for targeted improvements of the genome of a given organisms or consortium of organisms. Some of these technologies have been further refined so that they can be applied in a more automated fashion using engineering principles known from other sectors. These technologies and this way of working have been termed “synthetic biology” but a clear and generally accepted definition of synthetic biology has never been developed so the terms Gene Technology and Synthetic Biology are often used interchangeable.

More recently a new set of technologies have been developed that enables precision mutagenesis at precise locations and at specific loci in the genome. The best-known technologies for this purpose are the TALEN and the CRISPR technologies. Particularly the CRISPR technology has opened new opportunities due to the high level of precision, a high level of versatility and flexibility as well as the ease of use. Improvements done with these precision tools have been termed Gene Editing or Genome Editing.

In addition to the technologies that can collectively be referred to as gene technology, Novozymes also apply more traditional methods like classical mutagenesis and artificial evolution for strain development. These technologies are based on random introduction of mutations into the genome of an organism and subsequent selection or screening for desired properties.

Novozymes produce products using microorganisms that have been improved using gene technology sometimes incl. Gene Editing where the product for end users does not contain the microorganism. Such products are not genetically modified, the organisms that was used to produce the products were. Examples of such products are enzymes, other proteins produced by microorganisms or metabolites produced by microorganisms such as fuel ethanol. The regulatory/legal term for this type of production is “contained use”. Novozymes refer to such products as Fermentation products as this term is more descriptive.

Novozymes also produce products that consist of microorganisms to be used by the end customer as live organisms. This includes products for Agriculture, Animal health and Human health and examples of such products are microorganisms to improve sustainable growth of various crops and probiotics for animals or humans.

Novozymes is not engaged in genetic improvement of plants or animals including humans and so this position only covers improvements of microorganisms.

 

<h3>Novozymes is committed to the use of available advanced molecular biology tools</h3>

Novozymes is committed to using safe and scientifically sound tools, to improve microorganisms used in the manufacturing of fermentation products, as well as live microbial products.

Novozymes is always compliant with the regulatory frameworks and legislation of the countries Novozymes operates in.

Novozymes respects any guidance and requirements from regulatory authorities on GM classification.

Novozymes is transparent about the use of gene technology incl. genome editing and GM classification meaning that we will answer questions on this topic from stakeholders in an open and honest way.

<h2> </h2>

<h3>Novozymes utilize any safe state of the art technology to the extent that freedom of operation has been secured</h3>

Novozymes uses gene technology incl. gene editing during development and improvement of fermentation products in compliance with applicable regulations and IP protection. We see this set of techniques as providing lots of benefits in terms of accuracy, speed, and flexibility.

<h2> </h2>

<h3>Safety and regulatory compliance</h3>

Before placing a fermentation product or live microbial product on the market, Novozymes systematically performs a risk assessment that must unambiguously support safety in commercialization and use. Such risk assessment is scientifically on par with what the most advanced regulatory systems require.

Novozymes complies with applicable regulations in all markets globally. This includes the regulations on genetically modified organisms and products therefrom.

<h2> </h2>

<h3>The use of gene editing technologies and other emerging technologies challenge current GMO definitions</h3>

There is considerable debate on the regulatory categorization of organisms modified by the gene editing. Some authorities like the authorities in the USA, Australia and Japan stated that organisms obtained with certain gene editing technologies should not be regulated under the existing GM legislation. In Europe on the other hand, the ruling of the European Court of Justice on July 25, 2018 on Directive 2001/18 (case C-528/16) the current status is that any modification made on an organism utilizing any technology developed after 2001 leads to a GMO. So, the current status is that there is a complete lack of international harmonization and that a given organism can have different GMO status in different parts of the world. Furthermore, virtually identical organisms developed using different technologies can have different GMO status in a given country despite that they are identical from any practical point of view. So, the current view on GMO vs. non-GMO is up for redefinition.

Novozymes propose a new definition of GMO that is agnostic to the applied technology and process towards the GMO and is solely based on the properties and genetic makeup of the final GMO. Novozymes propose a definition with the following wording:

Genetically modified organism (GMO) means an organism, with the exception of human beings, in which the genetic material has been altered in a way that does not occur naturally by mating and/or natural recombination.

The consequence of that is the organisms that have improved in such a way that exogenous DNA has been inserted and so new properties have been added are considered GMO’s whereas organisms where only changes to the endogenous DNA have been done and no functions or activities from a non-sexually compatible species are added are considered non-GMO’s.

Last revised March 2023

Gene editing

<h4>Novozymes position statement on human rights and labor standards</h4>

Novozymes respects human rights as defined by the <a href="http://www.ohchr.org/Documents/Publications/GuidingPrinciplesBusinessHR_EN.pdf" target="_blank">UN Guiding Principles (UNGP) on Business and Human Rights</a>

Novozymes respects the International Bill of Human Rights, the International Labor Organization's (ILO’s) Declaration on Fundamental Principles and Rights at Work, and, since 2001, we have been a signatory to the United Nations Global Compact (UNGC). Novozymes is also a UN Global Compact LEAD company.

The 6 UNGC principles related to human rights and labor standards, which we support and report on are as follows:

<ul><li>UNGC Principle 1: we support and respect the protection of internationally proclaimed human rights </li>
	<li>UNGC Principle 2: we work to ensure that we are not complicit in human rights abuses </li>
	<li>UNGC Principle 3: we support freedom of association and right to collective bargaining</li>
	<li>UNGC Principle 4: we support the elimination of all forms of forced and compulsory labor </li>
	<li>UNGC Principle 5: we support the effective abolition of child labor</li>
	<li>UNGC Principle 6: we support the elimination of discrimination in respect of employment and occupation</li>
</ul>To demonstrate our respect for human rights, we have since 2012 integrated the UN guiding principles on Business and Human Rights into our operations by: addressing human rights in operational policies and procedures, by carrying out due diligence and impact assessments in countries where we operate, and by offering grievance mechanisms to internal and external stakeholders.

We report on our performance on human and labor rights annually in our Communication on Progress (COP) to the UN Global Compact, which is also an integral part of our Annual Report.

<h5>Embedding human rights in operational policies and procedures</h5>

The UN guiding principles are integrated in our operational policies and procedures. For example, our “People Policy”, “Global Non-Discrimination and Anti-harassment Policy”, “People Standard” and the “Novozymes Standard on Occupational Health and Safety” ensure that the UN guiding principles are upheld in our organization. We require all our employees to respect the human and labor rights and take appropriate measures to avoid and mitigate adverse human rights impacts also in our supply chains.

Human and labor rights are also included in our supplier performance management system, where Novozymes’ screens suppliers and evaluates them on an integrated set of assessment criteria which covers, commercial, quality, employee health and safety, human and labor rights and business integrity. In addition, Novozymes is also a member of the Supplier Ethical Data Exchange (SEDEX) platform to increase the level of transparency in our supplier base and to work continuously to improve our responsible sourcing practice in a more structured way, with increased data quality. We are using the SEDEX collaboration platform to engage with our suppliers to address and manage sustainability risks in our supply chain, including human and labor rights.

We require all contracted suppliers to comply with our <a href="https://nz.engage.novozymes.com/l/701243/2022-12-08/qtlsq/701243/1670560134ClubYAgT/Novozymes_Responsible_Purchasing_Standards.pdf" target="_blank">responsible purchasing standard</a> which covers human and labor rights aspects as defined by the UN guiding principles. In case a supplier does not conform with our standard, we thoroughly assess whether a corrective action plan or choosing an alternative supplier is the appropriate response to ensure ethical performance across our supply chain.

<h5>Due diligence and impact assessments</h5>

Our impact assessments are inspired by the UNGPs’ Protect, Respect and Remedy Framework. We carry out regular human rights impact assessments by involving stakeholders from relevant functional areas across the regions. The outcome of the assessment is communicated to the respective functions or business areas. Based on the learnings, the necessary corrective and preventive actions are determined and implemented. Furthermore, we work continuously on awareness building and improving the due diligence processes.

<h5>Grievance redressal mechanisms</h5>

Grievance mechanism are in place for both employees as well as external stakeholders. Novozymes has a global ombudsperson as well as regional ombudspersons in each region. We also have a Whistleblower hotline for employees and suppliers to report suspicions of violations of law, including violations of human and labor rights.

Approved by Ester Baiget Arnau, CEO Novozymes  Last revised March 2021

Human rights and labor standards

<h4>Novozymes position statement on industrial biotechnology</h4>

Industrial biotechnology can improve the efficiency of processes both in industry and in everyday life, by saving energy, water and other raw materials while reducing waste. It is an important tool to create better lives in a growing world.

Biotechnology is the use of living cells to make useful products. For thousands of years, humans have enjoyed the benefits of using bacteria, yeasts, molds and the enzymes these produce, to make bread, cheese, beer and wine.

Nowadays, enzymes and microorganisms are used in the manufacture of a wide variety of products. From low-temperature laundry detergents and margarine without trans fats, to renewable fuels and antibiotic-free chicken feed. Mankind’s knowledge of fermentation and other biological processes has increased tremendously. Since the 1980s, gene technology has made industrial biotechnology even more efficient and made it possible to produce enzymes with new and better capabilities.

Novozymes finds that industrial biotechnology and gene technology can contribute to the sustainable development of society by offering:

<ul><li>Lower environmental impact through better, more efficient and cleaner industrial processes </li>
	<li>More food, feed and fiber from the same resources and land use</li>
	<li>Renewable alternatives to petroleum-based fuels and chemicals</li>
	<li>New and better products for human and animal health</li>
</ul>Novozymes is committed to sharing its knowledge about the potential of biology and industrial biotechnology with the public and other stakeholders outside of Novozymes.

Last revised August 2020

Industrial biotechnology

<h4>Novozymes position statement on responsible purchasing</h4>

Novozymes considers sustainability, commercial, and quality aspects when choosing suppliers.

Novozymes is committed to doing business with high ethical standards, recognizing our responsibility as a multinational company with a global footprint. Novozymes has been a signatory of the UN Global Compact since its establishment in 2001 and a LEAD member since 2011. Novozymes follows the Global Compact’s Ten Principles to meet fundamental responsibilities in the areas of human rights, labor, environment and anti-corruption. The Ten Principles guide Novozymes’ approach to doing responsible business across our value chain, including our selection of, and engagement with, more than 10,000 suppliers. 

In 2018, Novozymes engaged with the Supplier Ethical Data Exchange (Sedex). Sedex is a non-profit membership organization for businesses committed to the continuous improvement of ethical performance within their supply chains and we became a member to increase the level of transparency in our supplier base and to work continuously to improve our responsible sourcing practice in a more structured way and with increased data quality. Novozymes is using the Sedex platform to engage with suppliers to address and manage sustainability risks in our supply chain. Our use of Sedex is an important part of our responsible sourcing approach, as we are working to enhance the foundation for supplier performance and risk assessments by connecting more cross-functional data from our supplier base.

Additionally, Novozymes’ process for screening and evaluating the company’s suppliers ensures a sustainable and systematic sourcing practice. It has four steps:

<h5>1. Inform:</h5>

Novozymes has developed guidelines to inform new and existing suppliers of the company’s requirements to suppliers’ conduct and performance. The Code of conduct can be <a href="https://www.novonesis.com/en/about-us/policies-positions#positions" target="_blank">downloaded here</a>.

<h5>2. Approve:</h5>

Novozymes evaluates key suppliers according to assessment criteria such as:

<ul><li>Sustainability performance 
	Environmental stewardship, employee health and safety, human and labor rights, business ethics, and supply chain management </li>
	<li>Commercial performance 
	Pricing, on-time delivery, service, complaints, innovation, and credit rating</li>
	<li>Quality performance 
	Product specifications, legal compliance, quality management systems, and audit acceptance</li>
</ul><h5>3. Monitor:</h5>

Novozymes monitors the performance of key suppliers through an ongoing evaluation process. Novozymes requires suppliers to comply with our responsible purchasing standards, as well as, when requested, to complete questionnaires and to accept visits and audits relevant for confirmation of compliance with the standards. In the long term Novozymes believes that collaboration and engagement with suppliers will have a greater impact than control alone.

<h5>4. Engage:</h5>

Even with the most effective risk management tools and systems, Novozymes can never guarantee that violations will not occur in its supply chain. If an incident occurs that violates relevant laws, regulations, or international conventions, Novozymes will contact the supplier to develop corrective actions to help the supplier improve its performance. If suppliers are unwilling to improve, Novozymes maintains the right to end the collaboration with immediate notice to ensure ethical performance across our supply chain.

Last revised February 2021

Responsible purchasing

<h4>Novozymes position statement on Water</h4>

Water stewardship is essential for Novozymes. We are committed to achieving overall water security by preserving water as a resource, addressing water challenges through our bio-solutions, and improving freshwater withdrawal  in operations. 

Water is the primary medium through which we feel the effects of climate change, especially with water availability becoming less predictable in many places1 . In the coming decades, many regions around the world are expected to face either absolute or seasonal water scarcity conditions2. At Novozymes, the production and development of our solutions depends on the availability of freshwater. We not only use water as a coolant and cleaning agent, but it also a component of our final products. Additionally, many of the raw materials required in our operations are agriculture-based and depend on water for production.

<h5>Our contextual water management approach </h5>

Our approach towards water stewardship is driven by science and our ambition to manage water in balance with local conditions at all our sites. We focus both on optimizing our water consumption and, outside our operations, we work on water restoration in collaboration with external partners. Our contextual water management approach is based on risks identified at local level, both in our operations and at the water basins close to our production sites. The approach allows us to be cognizant of challenges and address basin-specific challenges including scarcity, quality and changing regulation. 

<h5>Driving collective action at the community level</h5>

Our unique contextual water management programs guide us to forge strategic collaboration with our communities and stakeholders towards collective action. We support our water stewardship agenda through collaboration with our external partners including the UN Global Compact, the CEO Water Mandate, the Worldwide Fund for Nature (WWF), and the Science Based Targets Network (SBTN). 

Overall, our actions address shared water challenges such as water quality and scarcity, through collective action on WASH, nature restoration and watershed restoration. In basins close to our production sites where Water, Sanitization and Hygiene (WASH) is a challenge, we aim to restore 10 billion liters of water by 2025 and 30 billion liters by 2030 from a 2021 baseline.

<h5>Reducing dependence of freshwater in operations</h5>

Novozymes seeks to improve freshwater withdrawal by implementing recycling and water efficiency projects, while ensuring compliance with local regulations. We aim to improve freshwater withdrawal by recycling 10% more water by 2025, 15% more by 2030 and 20% more by 2035 (from a 2021 baseline).   
We invest in water re-use/recycle technologies, especially in high priority/water stressed regions. Our sustainability capex program enables prioritization of projects that improves water efficiency and enables water re-use/recycle. 

<h5>Enabling water efficiency through our solutions </h5>

Many of our bio-solutions in textile, brewing, household care and grain &amp; starch processing enable customers to reduce their water consumption compared with conventional methods, while improving efficiency, wastewater quality and reducing dependence on hazardous chemicals. 

<h5>Transparent water disclosure</h5>

We disclose our water performance and impacts in our annual report and CDP’s water security questionnaire every year. 

 

1) Source: Water and Climate Change, UN Water 

2) Source: The United Nations World Water Development Report 2021

Last Revised February 2023

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