Sonova ESG Report 2022/23
ESG strategy and governance
ESG strategy and targets
IntACT, Sonovaʼs ESG strategy, defines our sustainability commitments by building on four key areas: protecting the planet, serving society, advancing our people, and acting with integrity. The name IntACT emphasizes the ultimate goal – keeping our planet and people intact – and underlines the urgency to ACT.
- Protecting the planet: We drive the transition to a resource-efficient and low-carbon future of our operations throughout the life cycle of our products and services.
- Serving society: We constantly innovate in hearing health care, improve access for people in under-served areas, and engage actively with our communities.
- Advancing our people: We foster our employeesʼ development, wellbeing, and engagement in an inclusive work environment that embraces diversity.
- Acting with integrity: We behave ethically and apply the highest quality and safety standards to everything we do.
Our sustainability management approach centers around tangible and measurable targets with firm dates for achievement and regularly measured performance indicators. In the table below, we list our key targets and progress covering the four areas of our ESG strategy. More information on performance indicators, targets, policies, processes, programs, and actions is provided in the corresponding sections of this ESG Report:
ESG strategy and governance
Progress on key ESG targets
Key ESG targets as of 2023/24
ESG strategy and governance
Sonova has a defined governance structure to manage, improve, and report on our ESG performance. The ESG governance structure involves our highest governance body – the Board of Directors –, the Management Board and ESG Council, the Corporate Sustainability team, ESG topic owners and experts at Group level, as well as local Group company representatives.
The Board of Directors bears the overarching responsibility for Sonovaʼs strategic direction – which includes the ESG strategy, key targets, and performance. The Board of Directors is also responsible for the approval of critical business policies, such as the Code of Conduct and the Human Rights Policy; as of the 2021/22 financial year, it also reviews and approves the annual ESG Report. The Board of Directors receives a monthly ESG update from the CEO, and ESG topics were on the agenda and discussed at most of the regular Board of Directors and committee meetings during 2022/23. Critical ESG topics of specific relevance during the 2022/23 financial year were for example greenhouse gas emissions reduction progress and target setting in line with the Science Based Targets initiative, diversity and inclusion, human rights, ESG reporting and assurance, as well as regulatory developments.
The two sub-committees of the Board of Directors – Audit Committee and Nomination and Compensation Committee – have specific responsibilities related to ESG. The Audit Committee reviews the performance and effectiveness of external and internal audit, which includes the external limited assurance of the ESG Report. The Audit Committee is informed quarterly about critical concerns raised via SpeakUp, our internal and external anonymous whistleblowing platform. The Nomination and Compensation Committee considers ESG capabilities as part of the process for selecting potential Board candidates, and also reviews and approves ESG related targets in the compensation for Management Board members. Sonova ensures that newly elected members of the Board of Directors are given appropriate introduction and orientation and that the members receive continuing training about their responsibilities.
The Management Board is responsible for oversight of Sonovaʼs ESG activities across all material ESG topics; and individual responsibilities per ESG topic are assigned to respective members of the Management Board. Progress on various ESG topics and target is regularly reviewed and discussed at Management Board meetings. ESG targets have been an integrated element of each memberʼs variable cash compensation (VCC) since the 2020/21 financial year. ESG performance objectives represent 10% of the overall VCC for each Management Board member: in general, 5% is allocated to two objectives that are consistent for all Management Board members, and 5% to one to three individual objectives for each member. The performance objectives that must be met to achieve the target VCC are mutually agreed upon at the beginning of the financial year.
The ESG Council consists of the Sonova Group CEO, CFO, GVP Operations, GVP Human Resources Management & Communications, Group General Counsel & Compliance Officer, and the Director Corporate Sustainability. The ESG Council met on a quarterly basis during 2022/23; it reviewed the monthly development and implementation of the Groupʼs ESG strategy, including its commitments and targets, and monitored progress on ESG key performance indicators and initiatives, defining measures and assigning responsibility for actions. In addition to the quarterly meetings, the ESG Council members received frequent updates on key ESG targets and performance development.
Sonovaʼs Corporate Sustainability team, led by the Director Corporate Sustainability, provides expertise to the Management Board on relevant ESG topics, implements and further develops the ESG strategy and initiatives across Sonova, monitors progress, prepares quarterly ESG Council meetings, regularly engages with relevant internal and external stakeholders, and closely collaborates with ESG topic owners and functional/business experts at Group level, as well as local Group company representatives. These local representatives report data on ESG progress and performance to the Corporate Sustainability team and drive relevant ESG initiatives locally within a specified country or region.