Responsible Sourcing

In 2023, Lonza expanded its commitment to Responsible Sourcing practices by joining BioPhorum's Product Carbon Footprint (PCF) working group. Through this, we can actively support alignment across industries and collaborate on PCF challenges, with the aim to harmonize and simplify the requirements towards our suppliers.

Furthermore, we were again awarded with the silver medal from EcoVadis in 2023, with a higher score in sustainable procurement compared to previous years – an acknowledgment of our advanced management system for responsible sourcing.

Since 2022, we have been a member of Together for Sustainability (TfS), a joint initiative based on the principles of the United Nations Global Compact and the Responsible Care Initiative of the International Council of Chemical Associations (ICCA). The mission of the initiative is to drive sustainability (environmental, social, governance) improvements across the members’ supply base. As a member-driven organization and peer-to-peer network, TfS member companies aim to harmonize increasingly complex supply chain management processes and optimize dialog among worldwide business partners and suppliers.

To identify the potential ESG impacts of our suppliers, we have developed an in-house risk classification methodology, which assesses prevailing risks in the supplier’s country (country risk) and supplier’s sector (purchasing category risk). The methodology incorporates criteria for environment (including climate and energy), social standards (including child labor) and health and safety.

To measure the ESG impacts of our suppliers, we invite them to perform a tailor-made Supplier Sustainability assessment and/or audit, utilizing external providers and partners of industry initiatives. Associated risks are mitigated through Corrective Actions Plans (CAPs) and follow-up assessments and/or audits.

Lonza has established a Conflict Minerals Public Policy Statement governing our position and expectations towards our suppliers on managing the use of Conflict Minerals in our supply chain. Our due diligence process embodies the substantive components of the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas (CAHRAs), the Swiss conflict minerals regulation.

Greenhouse gas (GHG) emissions associated with our supply chain are a major contributor to our overall corporate carbon footprint. Scope 3 emissions include GHG emissions from purchased goods and services, capital goods, upstream and downstream transportation and distribution, waste generated in operations, employee commuting, business travel, and fuel- and energy-related activities, and end-of-life treatment of sold products.

A large proportion of Lonza’s Scope 3 GHG emissions can be attributed to purchased goods and services. In order to reduce such emissions across the supply chain, we have launched a Supplier Decarbonization initiative with the support of an external partner. Through this collaboration, our suppliers can improve their maturity on GHG management and submit their environmental data to Lonza and other customers, and access expert advice on how to set science-based targets.

As part of our emission reduction strategy, we have submitted near-term, science-based emissions reduction targets that have now been validated by the Science Based Targets initiative (SBTi). We have committed that 79% of our suppliers by emissions covering purchased goods and services, capital goods and upstream transportation and distribution, will have science-based targets by 2028¹. As part of this commitment, we expect our suppliers to set at least Scope 1 and 2 near-term climate targets aligned with a 1.5ºC pathway following the SBTi guidelines, latest by 2028.

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¹This corresponds to suppliers representing 67% of Scope 3 emissions.