Reduce greenhouse gases
Our goal is to reflect the commitments outlined in the Paris Agreement and thereby reduce emissions of greenhouse gases in our value chain.
Our commitment
Our operations are highly dependent on resilient eco systems; we cannot do business without significant input of raw material from nature. The effects of climate change pose a risk to all of us. At Swedish Match, we acknowledge the severity of this issue and we welcome the rising ambitions within the corporate sector at a global scale. We commit to do our part in addressing climate change and to set science-based targets for our business’ value chain.
We assess risk related to climate change on a recurring basis for our own operations and for raw material supplies. With a value chain perspective, we have good opportunities to contribute in creating a positive impact through collaboration with partners, enhanced assessments and directed mitigation and adaptation actions, in the longer term.
Accounting for greenhouse gas emissions in our value chain1)2)
We have assessed and reported greenhouse gas (GHG) emissions from our own facilities (Scope 1 direct emissions), emissions from purchased energy used in our own operations (Scope 2 indirect emissions), and part of other indirect emissions including emissions both upstream and downstream in our value chain not covered in Scope 2 (Scope 3 other indirect emissions), according to the Greenhouse Gas Protocol3), since 2008. In 2016, we extended our scope for GHG emissions and mapped the full value chain according to the Corporate Value Chain Standard (Scope 3) of the Greenhouse Gas Protocol.
The GHG emissions across the value chain amount to 205,606 tons CO2-equivalents (CO2e) for the year 2018. Raw material and supplier stages (lifecycle data for purchased goods and services) account for 64 percent of total emissions. Factory/Warehouse/Office account for 19 percent (Energy and fuel use, waste generated in our own operations as well as business travel4)). Transport and distribution account for 5 percent. The customer (chillers for snus in stores) and consumer stages (use of lighters and matches as well as end-of-life treatment of products) account for 7 and 5 percent respectively.
Emissions from our own operating units, direct emissions (Scope 1) and indirect emissions (Scope 2), account for 15 percent of the total GHG emissions. The remaining 85 percent includes emissions both upstream and downstream (Scope 3) in our value chain where a larger part of the emissions stem from the extraction and production of raw materials, e.g. tobacco, timber and nylon, as well as packaging material.
Our GHG accounting includes the full Scope 3. Generic emission factors have been used to a large extent to calculate emissions5). All six GHGs covered by the Kyoto Protocol6) are included in the calculations and assumptions and emission factors have followed a conservative approach.
1) Figures described in this section are based on best available information and are subject to revision. Revised figures will be presented on the Company’s website when available.
2) Data excludes facilities acquired in 2017 and 2018; V2 Tobacco, House of Oliver Twist, and Gotlandssnus.
3) International standard for calculating and reporting climate impact from business activities.
4) Business travel is allocated to Scope 3 in the GHG accounting but has been included in our own operations in the distribution of emissions across our value chain stages.
5) Main sources of reference for emission factors include DEFRA, Ecoinvent and IEA.
6) IPCC Fourth Assessment Report.
Reducing GHG emissions in a science-based manner
We have developed an emission reduction strategy with science-based targets, based on the revised measurement made in 2016. Science-based targets are in line with the level of decarbonization required to keep the rise in global temperature below 2°C compared to pre-industrial levels1). In this process we have been guided by the methodology of the Sectoral Decarbonization Approach2) (Other Industry3) pathway) and made use of the associated calculation tool to form a basis for our decision. Our aim is to reduce emissions by 75 percent by 2050, with 2017 as the base year. This would render absolute emission reductions of 4 percent per year, every year, until 2050. Our interim targets are emission reductions of 12 percent by 2020 and of 41 percent by 2030. We have committed to set these targets through the Science Based Targets Initiative (SBTi) and a submission for validation was completed in 2018. SBTi has now assessed the submission, and, in March 2019 approved the targets set.
Our GHG reduction targets have been set by the Group Management Team and approved by the Swedish Match AB Board of Directors. The responsibility to achieve the targets has been delegated to heads of our divisions. This organization ensures that targets are integrated into, and continuously followed-up upon, as part of normal business operations and review processes.
CDP
Swedish Match annually reports information on governance, risk and opportunities and climate data to CDP4) Climate. By reporting to CDP, our stakeholders are provided with more information about Swedish Match’s initiatives and their results.
Actions
In the process of setting targets, we have identified a wide range of actions to be taken in pursuit of reducing our value chain emissions. Action plans have been set and responsibilities have been distributed across the Group for main sources of emissions. Initial actions include revisiting procurement practices and replacing materials and energy (resources) with alternatives of lower carbon intensity, using resources more efficiently, engaging with business partners, and, in the longer term, developing products with lower carbon intensity. We will also continuously aim to enhance our accuracy in the GHG accounting, which will help us to find further potential for reduction and to set the right priorities for our actions.
1) As described by the Intergovernmental Panel on Climate Change (IPCC).
2) Sectoral Decarbonization Approach (SDA): A method for setting corporate emission reduction targets in line with climate science (2015). www.sciencebasedtargets.org.
3) The “Other industry” sector includes all industries that cannot be allocated to the industry sectors Iron & steel, Cement, Aluminum, Pulp & paper and Chemicals & petrochemicals, e.g. food, beverage and tobacco processing.
4) CDP (formerly Carbon Disclosure Project) is a not-for-profit charity that runs the global disclosure system for investors, companies, cities, states and regions to manage their environmental impacts.
| Greenhouse gas emissions (metric tons CO2e) | 20181) | 20172) | 20162) |
|---|---|---|---|
| Scope 1 | 9 173 | 9 917 | 10 860 |
| Scope 2 | 21 088 | 20 031 | 20 061 |
| Scope 3 | 175 344 | 177 280 | 182 215 |
| Total emissions | 205 606 | 207 229 | 213 137 |
| Total emissions (per MSEK sales)3) | 16.3 | 18.9 | 19.0 |
| Change in total emissions, % | -1 | -3 | N/A |
1) Data excludes facilities acquired in 2017 and 2018; V2 Tobacco, House of Oliver Twist, and Gotlandssnus.
2) Figures restated for Scope 3 emissions due to refined data collection.
3) Figures restated following further analysis.
| Energy use in our own operations (MWh) | 20181) | 20172) | 20162) |
|---|---|---|---|
| Direct energy use | 84 700 | 90 045 | 99 970 |
| Indirect energy use | 87 489 | 85 495 | 84 145 |
| Total energy use | 172 190 | 175 540 | 184 115 |
| Total energy use (per MSEK sales)2) | 13.7 | 16.0 | 16.4 |
1) Data excludes facilities acquired in 2017 and 2018; V2 Tobacco, House of Oliver Twist, and Gotlandssnus.
2) Figures restated following further analysis.
