Climate Change Data

Environmental Metrics

ESG Focus Areas

• Energy mix
• Waste management
• Diversity
• Business ethics
• Product safety and quality
• Supply chain traceability
• Financial performance

Environmental Achievements

• Disclosed Scope 1 and Scope 2 greenhouse gas emissions for the first time.
• 28% of energy sources are now renewable as of 2021.
• Four major manufacturing facilities received ISO 14001 certification.

Social Achievements

• Hired first Vice President of Leadership Development and Diversity, Equity, and Inclusion.
• Set 2026 DEI targets.
• Launched two Employee Resource Groups.
• Added one woman to the Board of Directors.
• Launched NovantaWELL, a global health and wellness resource center.

Governance Achievements

• 100% of Key Suppliers agreed to comply with Supplier Code of Conduct.
• Enhanced Supplier Code of Conduct to include stricter labor compliance requirements.
• Conducted a digital survey on top strategic suppliers to assess their compliance with added environmental criteria.

Climate Goals & Targets

Environmental Challenges

• Potential disruptions to business operations from energy supply shortages or damage from extreme weather.
• Environmental impact of single-use medical consumable products.
• Reducing Scope 3 GHG emissions.

Mitigation Strategies

• Developing strategies to mitigate risks by identifying alternative suppliers, sourcing raw materials from different locations, modifying product designs, and in-sourcing production.
• Developing strategies to continuously improve manufacturing and distribution of products to reduce negative environmental impact.
• Developing plans to define the scope, tools, and methodologies for measuring Scope 3 GHG emissions (to begin measuring by 2026).

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather conditions and natural disasters
• Energy supply shortages

Opportunities

• Growth opportunities in product offerings to green technology applications.

Reporting Standards

Frameworks Used: SASB, TCFD

Certifications: ISO 9001, ISO 14001 (4 facilities), ISO 45001 (3 facilities), ISO 13485

Sustainable Products & Innovation

• MOVIA scan head product (new cardboard packaging with innovative film suspension).

Environmental Metrics

ESG Focus Areas

• Climate Change
• Environmental Sustainability
• ESG

Environmental Achievements

• Achieved 14% reduction in GHG emission intensity (metric ton of CO2e per million dollar of revenue) from 2021 baseline on an Organic basis.
• Increased renewable energy supply to 46% of consumed grid electricity and 36% of total consumed energy.

Social Achievements

• Not disclosed

Governance Achievements

• Established board-level oversight of climate-related issues through the Environmental, Social and Governance Committee.

Climate Goals & Targets

Environmental Challenges

• Complex and quickly evolving regulatory landscape around environmental, social and governance reporting.
• Governmental laws and regulations to reduce greenhouse gas emissions worldwide.
• Proposed climate-disclosure rules from the SEC and the Corporate Sustainability Reporting Directive (CSRD) promulgated by the EU.
• Various governments around the world imposing levies on carbon emissions.

Mitigation Strategies

• Expanded existing risk management program to incorporate a broader ESG assessment and a specific climate-related risks and opportunities assessment, utilizing the recommendations of the TCFD and SASB.
• Implementing energy reduction initiatives in various locations and looking for opportunities to source electricity from renewable sources.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Environmental aspects added into supplier code of conduct and initial survey of key suppliers started.

Climate-Related Risks & Opportunities

Physical Risks

• Natural disasters

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Growth opportunities in product offerings to the green technology applications, such as electric vehicles and robotics.

Reporting Standards

Frameworks Used: TCFD, SASB, GHG Protocol

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Greenhouse gas (GHG) emissions reduction
• Environmental impact of products and supply chain
• Diversity, equity, and inclusion
• Business ethics
• Product safety and quality
• Supply chain traceability
• Financial performance

Environmental Achievements

• Achieved a 5% reduction in total market-based Scopes 1 and 2 greenhouse gas emissions on a Reported basis and an 18% reduction on an Organic basis year over year.
• Achieved an 8% reduction in market-based Scopes 1 and 2 greenhouse gas emissions intensity from 2022 to 2023.
• Successfully completed ISO 14001 audits of all 10 manufacturing operations and received ISO 45001 certifications for 6 of these operations.
• Integrated sustainability into the Novanta Growth System (NGS) through kaizen events and the rollout of the New Product Introduction (NPI) Toolbox.

Social Achievements

• Sponsored 575 community service days, surpassing the NovantaCARES goal of 500 days.
• Increased representation of women and underrepresented groups within the organization.
• Launched a project to enable voluntary disclosure of demographic information for non-U.S. locations.
• Launched DEI Masterclasses engaging over 1,000 employees.

Governance Achievements

• Integrated sustainability criteria into purchasing and supplier audits.
• 93% of Novanta’s manufacturing operations are ISO 14001 certified and 60% are ISO 45001 certified (100% and 100% by February 2024 respectively).
• Board of Directors composed of 50% men and 50% women.

Climate Goals & Targets

Environmental Challenges

• Complex and evolving regulatory landscape around sustainability reporting and GHG emissions reduction.
• Potential disruptions to business operations due to energy supply shortages or extreme weather.
• Negative environmental impact from single-use medical consumables.
• Availability limitations for renewable electricity at international facilities.

Mitigation Strategies

• Developing strategies to manage increasing compliance costs and carbon emission levies.
• Developing strategies to mitigate risks from energy supply shortages and extreme weather (formalizing business interruption plans, identifying alternative suppliers, modifying product designs, in-sourcing production).
• Analyzing reusable alternatives to single-use products, considering energy intensity of production and cleaning.
• Continuing to seek and evaluate opportunities to purchase renewable electricity that meet quality standards.

Supply Chain Management

Supplier Audits: 12 onsite audits included sustainability criteria in 2023, all onboarding and recertification audits will include sustainability criteria in 2024.

Responsible Procurement

• Supplier Code of Conduct
• Sustainable Purchasing Policy

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather conditions and natural disasters
• Energy supply shortages

Transition Risks

• Evolving regulatory landscape around sustainability reporting and GHG emissions reduction
• Governmental laws and regulations to reduce greenhouse gas emissions

Opportunities

• Growth opportunities in green technology applications (electric vehicles, robotics, solar, energy storage).

Reporting Standards

Frameworks Used: SASB, GRI

Certifications: ISO 14001, ISO 45001, ISO 9001, ISO 13485

Third-party Assurance: LRQA Inc.

Sustainable Products & Innovation

• Robotic tool changer technologies for electric vehicle production
• Beam steering technologies for eMobility and renewable energy products
• Digital scanners for additive manufacturing

Awards & Recognition

• Recognition by the Boston Club as one of five companies with boards with at least 50% female directors.