PERNOD RICARD - Universal Registration Document 2019-2020
3. SUSTAINABILITY & RESPONSIBILITY The four pillars of the good times from a good place roadmap
Climate-related risks and horizon
Potential financial impact and magnitude of impact
Impact on the Group's strategy and financial planning
Type
Area of business impacted
Physical risks Chronic
Long-term risk: The Group and its suppliers’ facilities are exposed to the risk of natural disasters (fire, hurricanes, flooding etc.).
Supply chain & Operations High impact:
Implementation of preventive measures and physical protection devices; audit of industrial sites along with insurers; establishment of business continuity management systems. Climate change is an important part of one of the key pillars of the Group’s S&R roadmap. The Group will continue to roll-out energy efficiency programmes (see subsection 3.3.3.2). The lower operating costs are factored into financial planning. This factor is considered in the Group’s marketing strategy and environmental roadmap, with a focus on sustainable agriculture practices and eco-design practices (see sections 3.3.1.1, 3.3.3.4). Innovation and digital are considered strategic
This risk could lead to the loss of a strategic industrial site. The impact could result in a significant operating loss and therefore a sharp drop or prolonged shutdown in the supply of certain products. This might prevent the Group for meeting consumer demand. Efficiency programmes can reduce operating costs and provide the Group with a competitive advantage.
Resource efficiency
Short-term risk: Pernod Ricard’s exposure to future energy and tax regulations are accelerating the implementation of energy
Supply chain & Operations Low impact:
efficiency programs at its operational sites as well as in its supply chain.
Market
Long-term opportunity: Consumers are increasingly looking to sustainable consumption. Developing quality products that respect the environment might encourage them to choose Pernod Ricard’s products. Short-term opportunity: Higher demand for lower emissions products and services and the incorporation of sustainability concerns are strong drivers
Products
Medium impact: The Group felt that this might lead to greater market share.
Products and services
Product & Services
High impact: This will generate new product and service offers. The Group felt that this might result in greater market share.
priorities; different entities are working on innovative projects.
to foster innovation and increase market share.
In case of future acquisitions, divestments or access to capital, significance of climate related risk should be assessed.
RESILIENCE OF THE ORGANISATION In June 2019, the Science Based Targets (SBT) initiative approved our greenhouse gas emission reduction targets, which are aligned with a below 2°C scenario for our Scope 1 and 2 emissions and the 2°C scenario for target intensity of the Scope 3 emissions.
This year, the Group has started a climate-related scenario analysis with a pilot in one affiliate. The objectives are the understanding of climate-related risks impacts on our operations (raw materials, packaging, production and logistics) and the building of a prospective approach for climate-related risks scenarios applicable at Group level.
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