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GRI Content: G4-1

Dear Colleagues,

Sustainable development is undergoing unprecedented change as the international community unites in pursuing ambitious, long-term solutions to significant global challenges. The Paris Agreement on climate action, the United Nation’s Sustainable Development Goals (SDGs) and the UK’s Modern Slavery Act underscore the need for more systemic responses to issues linked to global warming and resource scarcity as well as human rights. The corporate sector is uniquely placed to align business opportunity with broader societal goals, using innovation and technology to push the boundaries of what is possible.

Against this backdrop, the testing, inspection and certification (TIC) industry must meet customer needs for compliance with increased regulatory and other standards linked to health, safety and environmental principles and respect for human rights. Moreover, new distribution channels such as e-commerce, and innovations in automation, data analytics, digitalization and new technologies all have the potential to profoundly alter the way that people live and work. Thus, the TIC industry has an important opportunity to support business pioneers, policy makers and citizens in anticipating technological transformations and adequately preparing for them.

During 2016, SGS made significant strides in its sustainability journey; augmenting its leadership position in sustainability and disclosure through external recognitions and industry benchmarks. We also focused on evolving our sustainability program to deliver transformational change through our Sustainability Ambitions 2020. Substantial progress towards these Ambitions is already being realized through marked improvements in our global safety performance, reductions in our CO2 emissions and enhanced investment in local communities. We have also maintained our status as a carbon neutral company, and we have begun working toward our ambition to have at least 30% of women in leadership positions. During the year, SGS reached a significant milestone in our journey toward integrated reporting, with our business materiality matrix bringing together for the first time the outputs of our global materiality assessment and our board risk review.

For the third consecutive year, SGS has been named the leading company in our industry by the Dow Jones Sustainability Indices (DJSI World and DJSI Europe). The Company has also been recognized as a global leader for its actions and strategies in response to climate change, featuring in the CDP’s ”Climate A List” and being named Industrials Sector Leader and Country Leader in our region.

We are committed to ensuring that SGS remains at the forefront of sustainability leadership within our industry as well as in the wider business community. This requires us to instill a culture where responsible business behavior is integral to every job role, and where our employees feel engaged in actions that have the potential to catalyze change at scale. The leadership team has a critical role to play in this; analyzing and assessing risks and opportunities and leading people to align their behavior and their actions with our mission to deliver value to society. During 2016, the leadership team played a central role, contributing to our materiality review and engaging in extensive discussion on key policy issues linked to human rights and vehicle fuel emissions. The new SGS Human Rights Policy and SGS Supplier Code of Conduct will ensure that human rights are respected at every level of our operations and supply chain, while our vehicle emissions policy engages managers in minimizing our Group CO2 emissions through their choice of fleet cars.

The next generation of sustainability within SGS will be defined by our ability to engage internal and external stakeholders in responsible actions that deliver value to society while supporting a clear growth strategy. Sustainability will continue to play a central role in helping SGS to deliver quality solutions in rapidly changing markets through organic growth, business acquisitions, innovative services and improved operating efficiency.

We would like to take this opportunity to thank our leadership team, employees and business partners for their support, expertise and commitment in helping SGS to realize its role as a trusted partner in building a more sustainable economy.

 

Sergio Marchionne
Chairman

Frankie Ng
Chief Executive Officer

 

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