P | Report | 2021_Proof | 26 |
DRIVING PERFORMANCE TO SUSTAIN OUR PURPOSE
TCFD Report
November 2021
2021 CONTENTS
CHAPTER 1
INTRODUCTION
PPC at a glance | 1 |
About the report | 2 |
2 | |
Forward-looking statements | |
CHAPTER 2 | |
STRATEGIC OVERVIEW | 3 |
Chairman and CEO foreword | |
PPC's position on climate change | 4 |
Governance | |
CHAPTER 3 | |
CLIMATE RISKS AND OPPORTUNITIES | 6 |
Cement's carbon challenge | |
A snapshot of PPC's physical climate risks | 6 |
Using scenario analysis to understand PPCs | 8 |
risks and opportunities | |
CHAPTER 4 | |
CLIMATE CHANGE STRATEGY | 13 |
Manage our carbon footprint | |
Response to climate transition risks and | 14 |
opportunities | |
Increase our resilience to physical climate risks | 14 |
Address key barriers to decarbonisation | 14 |
Cross-cutting actions to support all activities | 15 |
CHAPTER 5
APPENDICES
Reference list | 16 |
List of acronyms | 16 |
17 | |
Cross-reference to TCFD recommendations | |
www.ppc.africa
INTRODUCTION
At PPC we recognise the global threat of climate change and the immensity of the challenges associated with achieving net-zero emissions by 2050. Yet, we are committed to reducing our carbon footprint, and committed to participating in the collective actions needed to address key barriers to decarbonisation.
NET ZEROBy | emissions | ||||
By 2050 | |||||
2030 | Net-zero | ||||
Less than | |||||
550 kg CO2/t | |||||
By 2025 | cementitious production | ||||
27% | |||||
emissions reduction | |||||
OUR TARGETS | * | 680 kg CO2/t | |||
cementitious production | |||||
AND AMBITION | emissions reduction | ||||
10% |
- Targets use FY2020 as a base year (756 CO2/t cementitious product), and are only for operations under PPC's control (i.e. exclude PPC Barnet in the DRC).
2021 REPORT TCFD PPC
INTRODUCTION continued
PPC AT A GLANCE
PPC is a leading multinational producer of building materials and solutions in multiple countries across sub-Saharan Africa, and we strive to grow a thriving business and create sustainable value for stakeholders. We maintain a simultaneous focus on being a responsible corporate citizen and on using effective environmental and energy management to minimise our impact on the environment.
PPC was established almost 130 years ago outside Tshwane in South Africa. From its beginning as the country's first cement manufacturer, PPC expanded its footprint and now operates across six countries - proving to be a resilient organisation that responds to challenges and captures opportunities in various operating environments. PPC provides quality cement, aggregates, limestone, readymix and fly ash across sub-Saharan Africa.
TCFD PPC 1 CHAPTER
OUR PURPOSE
To empower people | ||||||||||||
to experience a better | ||||||||||||
quality of life. | the RIGHT thing | |||||||||||
PPC always does | ||||||||||||
Holding each other | ||||||||||||
accountable and | ||||||||||||
R | always acting with | |||||||||||
integrity | ||||||||||||
PPC strives for | ||||||||||||
E | ||||||||||||
EXCELLENCE | ||||||||||||
Striving for | ||||||||||||
excellence in | ||||||||||||
everything | ||||||||||||
PPC's PEOPLE | ||||||||||||
OUR VALUES | are its strength | |||||||||||
PPC values its | ||||||||||||
people and | ||||||||||||
recognises that | ||||||||||||
P | ||||||||||||
every person is | ||||||||||||
essential to the | ||||||||||||
company's success | ||||||||||||
PPC has a PASSION | ||||||||||||
for performance | ||||||||||||
Inspiring each other | ||||||||||||
with a positive | ||||||||||||
P | attitude and energy | |||||||||||
in striving to be | ||||||||||||
the best | ||||||||||||
PPC is CUSTOMER- | ||||||||||||
focused | ||||||||||||
Customers are | ||||||||||||
at the heart of | ||||||||||||
C | everything as PPC | |||||||||||
strives to exceed | ||||||||||||
expectations every | ||||||||||||
time |
BRAND PROMISE
By focusing on quality in everything, PPC dedicates itself to perfecting the science behind producing cement, aggregates, lime, readymix, fly ash, burnt dolomite and limestone. PPC continues to invest in the now to create a better world for future generations. The company encapsulates this purpose in its Strength Beyond brand promise, guided by the group's values embedded in its operations.
It is the strength of PPC's guarantee | |
- the integrity placed behind every | |
It is the strength of PPC's name and | purchase and every interaction, and |
the knowledge that when customers | |
promise to customers, shareholders, | |
buy a PPC product, they place | |
investors, employees | |
their trust and name | |
and communities. | |
on PPC's word. | |
STRENGTH | |
BEYOND | |
It is the strength | |
It is the strength of PPC's purposeful | of PPC's people to go beyond - |
and sustainable partnerships | to provide support beyond |
with like-minded organisations that | the ordinary and take an active role |
will foster growth in its environment | in helping stakeholders reach their full |
and help improve societies. | potential and transform their |
societies. | |
PPC'S PEOPLE
As the essence of the company, PPC's workforce needs to be motivated and skilled to help the company drive its strategy and deliver on its objectives. Every employee is critical to the success of the business, and the company strives to ensure that its inspiring, diverse and ambitious culture is embedded throughout the organisation. Employee experience is integral to the organisation, and it promotes the employee value proposition through six pillars, which create the unique and high-performing culture.
1 2021 REPORT
INTRODUCTION continued
ABOUT THE REPORT
This report is a special publication that details PPC's evolving climate change strategy and outlines
the scenario analysis and greenhouse gas (GHG) reduction ambitions underpinning it.
It is our first comprehensive response to the recommendations of the Task Force on Climate- Related Financial Disclosures (TCFD) for climate disclosures. Created by the Financial Stability Board in 2015, the TCFD provides a framework for companies, banks, and investors to include more effective climate-relatedfinancial disclosures in their reporting processes. We have structured the report to address the TCFD's themes of Governance, Strategy, Risk Management, and Metrics and Targets. A reference table that cross-referencessections of this report to specific TCFD recommendations is included as an appendix.
Sections of this report also align with the Global Reporting Initiative (GRI) standards for sustainability reporting, the United Nations Sustainable Development Goals (SDGs)
(most notably SDG 7, SDG 12 and SDG 13), and the Institute of Directors, South Africa, King IV Report on Corporate Governance for South Africa, 2016 (King IV™*) on the responsibilities of governing bodies in responding to climate change.
This report follows the reporting boundary used in PPC's integrated reporting. As such, our climate change strategy and targets (Section 4) cover only the operations that are under PPC's control. However, for the scenario analysis (Section 3) we included the operations of PPC Barnet (which became classified as a discontinued operation in March 2021) in the DRC on the basis that PPC provides operational services, although PPC no longer has management control.
- Copyright and trademarks are owned by the Institute of Directors in South Africa NPC and all of its rights are reserved.
FORWARD-LOOKING STATEMENTS
This report includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included in this report, including, without limitation, those regarding PPC's financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to PPC's products, production forecasts and reserve and resource positions), are forward-looking statements. The words "intend", "aim", "project", "anticipate", "estimate", "plan", "believes", "expects", "may", "should", "will", "target", "set to" or similar expressions, commonly identify such forward-looking statements.
Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of PPC, or industry results, to
be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such forward-looking statements are based on numerous assumptions regarding PPC's present and future business strategies and the environment in which PPC will operate in the future. Among the important factors that could cause PPC's actual results, performance or achievements to differ materially from those in the forward-looking statements are levels of actual production during any period, levels of demand and market prices, the ability to produce and transport products profitably, the impact of foreign currency exchange rates on market prices and operating costs, operational problems, political uncertainty and economic conditions in relevant areas of the world, the actions of competitors, activities by governmental authorities such as changes in taxation or regulation and such other risk factors identified in PPC's most recent annual report.
Forward-looking statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on forward-looking statements. These forward-looking statements speak only as of the date of this report. PPC expressly disclaims any obligation or undertaking (except as required by applicable law, the UK Listing Rules, the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority and the Listing Rules of the Australian Securities Exchange) to release publicly any updates or revisions to
any forward-looking statement contained herein to reflect any change in PPC's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
Nothing in this report should be interpreted to mean that future earnings per share of PPC will necessarily match or exceed its historical published earnings per share.
2 2021 REPORT TCFD PPC 1 CHAPTER
STRATEGIC OVERVIEW
CHAIRMAN AND CEO FOREWORD
Welcome to PPC's first TCFD report. We are publishing this because we understand the climate challenge that society is facing. We recognise that PPC is a contributor to global GHG emissions, primarily because of the high carbon intensity of the cement production process. Yet we also intend to be a contributor to climate change solutions. As stakeholders seek agreement on a global reporting standard, TCFD offers a practical and widely adopted structure for understanding climate change-related impacts on existing operations and for guiding emissions targets.
OUR NET-ZERO AMBITION
At PPC, our ambition is to achieve net-zero emissions by 2050. Our commitment to this ambition is evident from the way our board and executive team remained focused on developing our climate change strategy over the last 12 months, despite the considerable operational challenges of the COVID-19 pandemic and the capital restructure.
To date we have faced relatively little pressure to reduce emissions from our investors and shareholders. We expect this to change in the coming years. Therefore, up until now, our net-zero ambition has been largely driven from within the company. We believe this forward-looking approach will place PPC further ahead of our regional peers as the challenges of climate change intensify.
This ambition has been internalised across PPC's management. Our executive team and line managers take responsibility for maintaining
a triple focus on the environmental, social, and financial sustainability of the business.
COMMITTED AND CONDITIONAL TARGETS
As a company, we recognise that the real challenge lies not in setting our sights on a net-zero ambition, but in setting targets that make such ambition possible. This report seeks to address this challenge.
Through an internally driven and consultative process that involved the executive team and line managers, we used rigorous scenario analyses
and an assessment of mitigation options at each operation to devise credible, transparent and defensible short-, medium- and long-term targets, and to develop an overarching climate change strategy. We indicate where our targets fall within our direct sphere of control, and where their feasibility is dependent on advancements of the regulatory environment and availability of new technologies.
The carbon dioxide challenges for cement are significant. Within sub-Saharan Africa, the industry's ability to decarbonise is inhibited by the lack of viable options to reduce emissions, the lack of consumer willingness to pay for greener products, and the lack of standards, testing
and track records of new products. Our efforts to achieve net zero are also currently bound by country-specific construction methods and codes. For example, South Africa's regulatory framework is not yet conducive to the deployment of certain emission-reduction strategies, such as the use of waste as a fuel source, to the same extent that is possible in Europe. We intend to forge ahead amidst this uncertainty and despite these challenges, continuously evaluating our strategy, being agile in our responses to changing circumstances, and collaborating with stakeholders to create the necessary enabling environment. Furthermore, where possible we will take a leadership role in
the use of waste as a fuel source, as evident in our recent successful introduction of tyres at our
De Hoek factory in the Western Cape and the use of biomass fuels in Rwanda.
TRANSITIONING TO A LOW-CARBON BUSINESS MODEL SUITABLE TO THE SUB-SAHARAN AFRICAN CONTEXT
For more than a century, PPC has demonstrated its ability to successfully cope with change. As an industry leader we have constantly found new ways to balance environmental, social, and financial elements. We will look to draw on this deep experience to ensure our sustainability going forward.
Although the demand for concrete is likely to increase over the next two decades to support a transition to renewable energy, we expect that over time the demand for Alternate Building Technologies across sub-Saharan Africa will increase, reducing the need for clinker based cementitious building materials. While this may cause concern for some of our peers, at PPC we find such a prospect invigorating.
As we aspire to create a built environment that is net zero or carbon negative, we will remain focused on our purpose, empowering people to experience a better quality of life. As sub-Saharan Africa's population grows, we will keep sight of our evolving social responsibilities, evaluating new construction methods holistically rather than solely from a carbon-intensity perspective.
We are also focused on driving the innovation of cement-alternative building practices. Indeed, most construction in sub-Saharan Africa is not constrained by space, and it need not mimic the cement-intensive building styles of other parts of the world. Therefore, we are exploring how to combine traditional African building methods with emerging global methodologies.
As we investigate these alternatives, we will explore options for directing resources from our current business model into an adjacent, low-carbon business model that is not directly linked to cement and that can ultimately become our core revenue stream. We will set targets for this business transition in future reports.
LOOKING AHEAD
This report does not provide all of the solutions to the climate change challenges we face but represents the first steps of PPC's net-zero journey.
As we progress in this time of uncertainty, we will continue to track emerging climate risks and opportunities and use climate scenario analyses to refine and improve our climate change strategy and inform our business strategy. We will continue to provide transparent updates about these strategies, as well as about our progress and performance. In
coming years, rather than publish another stand- alone TCFD report, we will incorporate and integrate it into our integrated annual report.
To our suppliers, shareholders, business partners and other stakeholders, thank you for your continued and unwavering support. We look forward to navigating our net-zero journey with you.
Jabulani Moleketi | Roland van Wijnen |
Chairman | CEO |
3 2021 REPORT TCFD PPC 2 CHAPTER
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PPC Ltd. published this content on 29 November 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 29 November 2021 05:19:06 UTC.