SUSTAINABILITY
Long-term commitment to sustainability
The philosophy of “Mutual Prosperity” lies at the heart of our sustainability agenda. NIPSEA Group believes that business success has to be measured by both the achievement of continued commercial viability and also the realisation of our commitments to our Planet and People. ESG considerations are deeply embedded into our business operations to ensure and safeguard continued growth for both NIPSEA Group and the environment.Our sustainability strategy is centred around the five overarching pillars of Customer, People & Community, Environment, Organisational Health and Technical Capability.
NIPSEA Group's Sustainability Pillars
Creating sustainable value for all stakeholders
People & Community
Investing in the well-being of our employees, and building and enabling better communities
Environment
Minimising our environmental footprint
Customers
Prioritising the needs of our customers
Technical Capability
Innovating to drive progress and betterment for society
Organizational Health
Ensuring continued economic viability
Ensuring continued economic visibility
2021 marks another year as we celebrate NIPSEA Group’s growth and achievements in delivering sustainable business value while we transition to a post-pandemic normal.
We have observed an increasing demand for our growing category of sealants, adhesives, and fillers (“SAF”) as a result of our advancements in product and service innovation. At the same time, we ensured that our architectural, automotive, industrial, marine, and protective coatings segments remain strong. The diversification of our portfolio and increased focus on adjacent businesses is expected to contribute significantly to our revenue growth over the next few years.
This year, we have made considerable progress on the environment and social sustainability front through emphasising research and development in formulating innovative and environmentally friendly products for our consumers. Moving forward, NIPSEA Group will continue optimising its assets and resources to best serve the immediate needs of the community. Below, we share our FY2021 achievements as we continue to identify and work on key sustainability-related issues and opportunities while operating in today’s business context.
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Business Achievements
Direct Economic Value Generated (USD' mil)
2021
$5,613
2020
$3,812 *
Economic Value Distributed (USD' mil)
2021
$5,126
2020
$3,311 *
Economic Value Retained (USD' mil)
2021
$487
2020
$501 *
 | 2021 | 2020 |
| $5,518 | $3,736 * | |
| Asia’s No.1 paint and coatings company (in terms of net revenue; USD’ mil) | ||
 | 2021 | 2020 |
| 94 | 83 | |
| Number of manufacturing facilities | ||
 | Global presence across 22 geographical locations |
 | 25,870 employees in NIPSEA Group, an increase of more than 11% compared to 2020. |
 | 4.3 billion litres of paint produced in the year, an increase of more than 12% production volume as compared to FY2020 figure. |
| *These economic values differ from those disclosed in SR2020 as NIPSEA Group updated its computation methodology this year as follows: Direct Economic Value Generated: Revenues = Net sales + revenues from financial investments, sales of assets & other income Economic Value Distributed = Sum (Operating costs, employee wages and benefits, payments to providers of capital, payments to government by country, community investment) Economic Value Retained = Direct Economic Value Generated – Economic Value Distributed Net Revenue = Gross sales from products and services – (returns + discounts + allowances) | |
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Sustainability Achievements
Environmental
Energy intensity decreased by 2.3%.
Emissions intensity decreased by 1.9%*.
Social
>57% of senior managers hired from the local community.
New hire rate of 26.0% and turnover rate of 18.7%.
Governance
99.4% of significant product and services categories for which health and safety impacts were assessed for improvement.
No substantiated complaints concerning breaches of customer privacy and no cases of customer information leaks/thefts.
Customer first innovation for a better life
Through expanding and leveraging on our R&D capabilities, NIPSEA Group catalyses product and process innovation while driving value creation as sustainability becomes increasingly salient in today’s landscape. Doing so allows us to be better positioned to meet our customers’ needs and allows us to create lasting impact for the future.
Achieving a sustainable future for people and nature
NIPSEA Group believes that businesses should play a key role in conserving natural resources and protecting our planet. We are committed to meeting our environmental targets and working towards a more sustainable future for all.
In seeking to increase circularity within our production processes, we strive to improve our recycling practices and lower the overall material intensity of our processes. We are currently trialing the use of recyclable pallets embedded with digital technology to provide analysable data that would advance our efforts to shift away from the current non-recyclable wooden pallets.
As at FY2021, our production processes utilise a notable proportion of renewable raw materials, accounting for 14.9% of our overall material usage.
In FY2021, our total energy consumption as a Group totaled 1,511,119.4 GJ, an increase of 31.1% as compared to the FY2020 measurement. This is due to a 34.1% increase in production volume from the previous year, together with the inclusion of new entities in this reporting year. On the other hand, our energy intensity ratio measured 253.1 MJ/tonne, which is a decrease of 2.3% from the FY2020.
We are co-developing better wastewater recycling systems with our industry partners to achieve zero discharge to the environment. This includes looking into the reuse of treated wastewater, enhancing wastewater treatment activities, and even into sanitisation levels of the wastewater that leaves our plants.
NIPSEA Group adopts the 3Rs – Reduce, Reuse and Recycle – in the management of our water-related activities.
To ensure that waste material from our factories does not contribute to land pollution in surrounding areas, we implement lifecycle land assessments in key factories, coupled with regular periodic checks.
As of FY2021, we generated 43,017.3 tonnes of waste material, out of which 24.3% was directed from disposal for reuse, recycling or energy recovery purposes and 75.7% was directed to disposal. Waste disposal methods employed include incineration, deposit at landfill or other methods such as waste sorting, fuel blending and disposal by the municipality.
Throughout our supplier management process, we consider factors such as environmental protection and sustainable development. In China, we ensure that our factories adhere to local “green factory” accreditation guidelines on production and logistical matters. This ensures that our supplier actions are accounted for and continue to uphold the “green standard” required.
Our Procurement department evaluates our suppliers on an annual basis. This supplier evaluation exercise includes an environmental assessment to ensure that they meet our required Standard Operating Procedures (“SOPs”) in managing environmental matters. In the event that suppliers fall short of the expectations we have of them, we provide solutions and guidance to help them improve their processes.
In FY2021, we subjected 591 out of 1,466 new suppliers to environmental screening criteria, accounting for 40.3% of our new suppliers. On the other hand, we also subjected 568 out of 1,466 new suppliers to social screening criteria, accounting for 38.7% of our new suppliers.
Harnessing the collective genius of our valued employees
Our people are the key driving force towards ensuring NIPSEA Group’s long-term success and growth. We endeavor to support and strengthen them in their professional and personal development through means of providing diverse opportunities for career advancement and ensuring an inclusive work environment that fulfils their needs.
We take pride in advocating for a diverse and inclusive workforce that encompasses different genders, generations, nationalities, and expertises across countries working collaboratively to produce better business outcomes for both our customers and the communities that we operate in.
In FY2021, the Group’s new hire rate measured 26.0%, which was higher compared to 2020 and the proportion of senior management hired from local communities measured at 57.1%
Employee safety is NIPSEA Group’s number one priority and we place great emphasis on the physical and mental well-being of our people. We achieve this through the enforcement of safe behaviours and the provision of good health and working conditions under local laws and regulations, as well as the Group’s Quality, Environment, Safety and Health (“QESH”) protocol. These policies form the health and safety foundation that governs actions within the Group, including the interactions we have with our suppliers, customers, or any other related third party. Occupational health and safety committees, chaired directly by Senior Management, oversee the management of workplace safety.
NIPSEA Group, we adopt a group-level learning framework that ensures the holistic development of our employees through upskilling their capabilities and competencies required at differing job levels. Training and educational programmes are uniquely tailored at the country level depending on the needs identified from our annual training needs analysis.
NIPSEA Group’s provision of diverse training and educational programmes ranges from technical to leadership upskilling to better equip our employees with the necessary skills in today’s ever-evolving business landscape.
In FY2021, we clocked a total of 387,243 hours, with an increase of >13% as compared to FY2020 for our employees, average of 15 hours per employee.
Building and enabling better communities
NIPSEA Group is committed to accelerating positive and sustainable change in communities, with a greater emphasis placed on the markets we operate in. As we continue to embark on value-added community initiatives, our priorities lie in investing in localised programmes and tackling socioeconomic challenges across three key pillars: Education, Empowerment, and Engagement.
Upholding customer trust and confidence
Ensuring responsible business practices has been of paramount importance to the customers we serve.
In this aspect, NIPSEA Group remains committed to adopting safe and ethical business practices throughout our operations and supply chain to assure customers of our product quality and ultimately maintain their satisfaction and trust in us.
