Measure to improve
How we measure and manage our sustainability performance.
Sustainability
To guide us on our sustainability journey, we have implemented essential measurement tools. In 2019 we first did our total climate accounting assessment and in 2020 we implemented the methodology in our financial accounting system.
In 2022 we started conducting Life Cycle Assessments for our products and started implementing the tool into our product development process. We have now conducted LCAs for more than 30 of our products.
- Climate accounting: This approach involves an input-output analysis based on financial reporting. Each financial account is translated into an emission factor, providing an understanding of our overall emissions for all countries and activities. The advantage of this method is that it creates a comprehensive overview of our emission footprint and accounts for data that are difficult to measure. The disadvantage is the lack of details in the data. We are using LCA methodology to ensure detail and quality of key data.
- Life Cycle Assessment (LCA): The LCA encompasses the examination of embedded carbon in our products from the extraction of raw materials to the production, transportation, use, and disposal or recycling of the final product. This method offers a greater understanding of how to reduce emissions per product. By analyzing the complete life cycle, we can identify areas where emission reduction measures can be implemented effectively.
We are now working on combining the two approaches to include more activity-based data in the Climate Accounting system. This integration will provide a more holistic view of our emissions, taking into account different activities and operations. Additionally, we are actively working towards including more primary data from our suppliers to obtain more accurate footprint data.
By merging the Climate Accounting system with more activity-based data and supplier-provided information, we will enhance our ability to measure and manage our sustainability performance. This approach will enable us to make informed decisions, implement effective emission reduction initiatives, and drive positive change throughout our value chain.
Climate accounting
In 2019, we conducted our first comprehensive climate accounting assessment, considering the most significant emissions from scopes 1, 2, and 3 in accordance with the GHG Protocol.
In 2020, we successfully integrated this framework into our financial accounting system, BOARD, which earned us recognition and awards. This integration allows us to automate the calculation and reporting of results, ensuring alignment with our financial system.
We use an open-source tool called EXIOBASE for our climate accounting. It provides a detailed global supply-use table (MR-SUT) and input-output table (MR-IOT). EXIOBASE harmonizes data from multiple countries and estimates industry-specific emissions and resource usage. By linking country-specific tables through trade, it allows us to analyze the environmental impacts of different product groups during their final consumption.
As part of our ongoing improvements, we are in the process of updating our input-output analysis methodology to utilize Figaro, a system that is updated more frequently. This update involves estimating CO2 emissions based on data produced by Eurostat within the framework of the FIGARO (Full International and Global Accounts for Research in Input-Output) project.
Furthermore, we are actively working on implementing activity-based reporting for various aspects, including materials, logistics, travel, business cars, and energy consumption. In cases where primary data from suppliers are unavailable, we will utilize industry averages to ensure comprehensive reporting and analysis.
Life Cycle Assessment (LCA):
In 2022, we collaborated with a sustainability-focused consultancy firm on a project that aimed to address key sustainability objectives. The project encompassed three primary goals:
- Conducting a Life Cycle Assessment (LCA): We analyzed the environmental impact of our products throughout their entire life cycle. This comprehensive assessment allowed us to understand the environmental implications associated with each stage of a product's existence.
- Identifying Emission Reduction Levers: Building upon the insights gained from the LCA, we identified specific areas and methods through which we could effectively reduce our emissions. This step involved pinpointing the most impactful opportunities for emission reduction aligned with our 2030 goals.
- Developing an Implementation Plan: Based on the potential for emission reduction identified, we devised a detailed plan outlining concrete actions that need to be taken. This plan included clear accountability measures within our organization, ensuring effective implementation of the proposed actions.
To conduct the LCA, we selected 30 primary products based on their sales volume, aiming to represent various segments within our product portfolio and geographic locations. During this process, we collected data on material inputs for each component of these products (known as the Bill of Materials) as well as site and logistics data for our company. These data were then scaled up to the company level, providing a comprehensive representation of Laerdal's overall environmental footprint based on the methodology of the Life Cycle Assessment.
Outcome
Through this process, we have achieved a deeper understanding of our emissions at both the product and company level. We have successfully identified the primary drivers of emissions in our products and operations. Specifically, we have pinpointed plastics, electronics, textiles, and metals as key focus areas for emission reduction efforts.
Furthermore, we have quantified the potential for reduction through the adoption of more digitized solutions and circular sales models, including innovative approaches like subscription models. These strategies hold promise in minimizing our environmental impact and contribute to our overall emission reduction goals.
By recognizing the key emission drivers and exploring sustainable alternatives, we are better equipped to implement targeted measures that address these areas effectively. This understanding enables us to develop and prioritize initiatives that will have a substantial positive impact on our environmental footprint.
Methodology
Our Life Cycle Assessment (LCA) methodology adheres to the GHG Protocol, encompassing all three scopes of emissions: scope 1, scope 2, and scope 3. However, it is important to note that in certain cases where data is insufficient, estimations and assumptions have been made. This particularly applies to areas such as product use and end-of-life considerations.
Additionally, when calculating emissions, we primarily rely on industry averages for emission factors due to a lack of primary data from our suppliers. While we strive to gather accurate and comprehensive information, the absence of supplier-specific data necessitates the use of these industry averages as a reasonable approximation.
Despite these limitations, we are committed to continuously improving our data collection processes and working closely with suppliers to obtain more precise and comprehensive information. By doing so, we aim to enhance the accuracy of our LCA and ensure that our emission calculations are as reliable as possible.