Climate Change Data

Environmental Metrics

ESG Focus Areas

• Financial, social and environmental reporting
• Business ethics

Governance Achievements

• Established a Remuneration Committee to enhance the process for preparing proposals for the remuneration of the Board of Directors and Executive Management.

Climate Goals & Targets

Environmental Challenges

• Deviations from the Danish Corporate Governance Recommendations regarding remuneration policy, severance payments, and independence of committee members.
• Deviations from NYSE Corporate Governance Listing Standards regarding director independence, compensation committees, nominating committees, and audit committee composition.

Mitigation Strategies

• The company explains the reasons for the deviations and outlines plans for long-term alignment with the recommendations (e.g., limiting severance payments to 24 months for future contracts).

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Climate Goals & Targets

Supply Chain Management

Climate-Related Risks & Opportunities

Environmental Metrics

ESG Focus Areas

• Sustainable Development
• Patient Access to Care
• Employee Well-being
• Environmental Responsibility
• Business Ethics and Human Rights

Environmental Achievements

• CO2 emissions from production sites and product distribution decreased by 2% to 127,000 tons
• 77% of the power used at production sites came from renewable sources
• Water consumption at production sites decreased by 5%
• Waste from production sites decreased by 10%
• 94% of all waste generated at production sites is recycled

Social Achievements

• Provided medical treatment to an estimated 29.2 million people with diabetes worldwide
• Reached an estimated 5 million people with human insulin at or below the ceiling price
• Updated and expanded its Business Ethics Code of Conduct to incorporate commitment to human rights
• 99% of all relevant employees completed business ethics training
• Average frequency rate of occupational accidents with absence was 2.4 per million working hours

Governance Achievements

• Updated Business Ethics Code of Conduct
• Incorporated respect for human rights into the Code of Conduct
• Completed 33 business ethics reviews
• Conducted 294 supplier audits

Climate Goals & Targets

Environmental Challenges

• Intensifying global competition within diabetes and biopharmaceuticals
• Continued pricing pressure within diabetes, especially in the US
• Need to increase agility and simplicity in operations
• Addressing unmet needs in haemophilia and growth disorders
• Healthcare reforms and government measures to curb drug costs

Mitigation Strategies

• Restructured R&D organization to accelerate pipeline expansion and diversification
• Implemented organisational changes to enhance adaptability
• Implemented a market-fit approach to tailor strategies to local market realities
• Established partnerships to leverage external expertise and diversify pipeline
• Entered into value-based contracts with health plans and pharmacy benefit managers

Supply Chain Management

Supplier Audits: 294/year

Responsible Procurement

• Supplier sustainability requirements

Climate-Related Risks & Opportunities

UN Sustainable Development Goals

• Goal 3: Good Health and Well-being
• Goal 12: Responsible Consumption and Production

Novo Nordisk's efforts to bring innovative products to patients and reduce environmental impact align with these goals.

Sustainable Products & Innovation

• Oral semaglutide

Environmental Metrics

ESG Focus Areas

• Financial, social and environmental reporting
• Business ethics compliance
• Information security
• Risk management

Governance Achievements

• Established a Compliance Hotline (whistleblowing)
• Conducted a fraud risk assessment
• Developed a new separate Remuneration Report to enhance transparency

Climate Goals & Targets

Environmental Challenges

• Maintaining compliance with both Danish and NYSE corporate governance standards.
• Ensuring the independence of board committees given the presence of employee representatives and representatives of the main shareholder.

Mitigation Strategies

• Provides explanations for deviations from Nasdaq Copenhagen and NYSE recommendations.
• Maintains a small number of committee members to allow for representation from various stakeholder groups.

Supply Chain Management

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Danish Corporate Governance Recommendations, NYSE Corporate Governance Listing Standards

Environmental Metrics

ESG Focus Areas

• Purpose and sustainability
• Scientific innovation

Environmental Achievements

• Achieved 100% renewable power across all production sites
• Reduced total CO2 emissions from operations and transportation by 44% from 2019

Social Achievements

• Launched a new social responsibility strategy, Defeat Diabetes
• Expanded US affordability offerings reaching more than one million people
• Lowered ceiling price of human insulin in 76 countries
• Expanded Changing Diabetes in Children programme

Governance Achievements

• Launched a new Remuneration Policy
• Improved company trust level to 80.6 from 78.2 in 2019
• No failed inspections among those resolved at year-end

Climate Goals & Targets

Environmental Challenges

• COVID-19 pandemic impacting patient access to treatments and commercial operations
• Affordability of medicines
• Climate change
• Intensifying competition within Diabetes care and Biopharm
• Pricing pressure within Diabetes care, especially in the US

Mitigation Strategies

• Transitioned to virtual interactions with healthcare professionals and customers
• Launched various affordability programs in the US
• Implemented Circular for Zero environmental strategy
• Increased R&D investments
• Developed access and affordability plans in 19 countries

Supply Chain Management

Supplier Audits: 177

Responsible Procurement

• Collaboration with suppliers to encourage sustainable sourcing

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: TCFD, SASB, CDP, GRI, UNGC, AA1000AP

Third-party Assurance: PricewaterhouseCoopers

UN Sustainable Development Goals

• Goal 3
• Goal 12

Focus on Goal 3 ('health') and Goal 12 ('responsible consumption and production')

Environmental Metrics

ESG Focus Areas

• CO2 emissions
• Energy consumption
• Environmental management
• Plastic
• Waste & circularity
• Water
• Access & affordability
• Diversity & inclusion
• Employees
• Human rights
• Innovation
• Prevention of serious chronic diseases
• Sustainable tax
• Bioethics
• Business ethics
• Corporate governance
• Culture & values
• Product safety
• Remuneration
• Risk management
• Suppliers

Environmental Achievements

• 43% reduction in CO2 emissions compared to 2019
• 100% renewable power across global production network

Social Achievements

• Reached 31,846 children through Changing Diabetes® in Children programme in 2021 (13% increase compared to 2020)
• Launched a new global parental leave policy offering a minimum of eight weeks paid leave to all non-birthing parents globally, regardless of gender (effective January 2022)
• Provided ~$100 million in copay assistance for insulin to patients in the US
• Reached more than 5 million patients via access and affordability programmes

Governance Achievements

• No failed inspections among those resolved by the relevant health authority at year-end (although one contract manufacturer filling syringes for Wegovy® failed an inspection)
• 98% of employees completed mandatory business ethics training
• Executive remuneration linked to performance on financials as well as non-financials (e.g., innovation, sustainability)

Climate Goals & Targets

Environmental Challenges

• Supply challenges for Wegovy® due to exceeding demand and a key partner experiencing issues with Good Manufacturing Practices (GMP)
• Initial challenges in meeting the unprecedented demand for Wegovy®

Mitigation Strategies

• Investing significantly in expanding future production capacity
• Taking steps within our global production to enable us to fully meet US demand in the second half of this year

Supply Chain Management

Supplier Audits: 253 in 2021

Responsible Procurement

• Supplier sustainability requirements

Climate-Related Risks & Opportunities

Reporting Standards

Frameworks Used: Value Reporting Foundation (VRF)/Sustainability Accounting Standards Board (SASB), Taskforce on Climate-related Financial Disclosures (TCFD), Carbon Disclosure Project (CDP), Greenhouse Gas Protocol, AccountAbility’s AA1000AP (2018)

Third-party Assurance: Deloitte Statsautoriseret Revisionspartnerselskab

UN Sustainable Development Goals

• Goal 3 (Good Health and Well-being)
• Goal 12 (Responsible Consumption and Production)

Awards & Recognition

• RE100 Key Collaborator Award

Environmental Metrics

ESG Focus Areas

• Environmental
• Social
• Governance

Environmental Achievements

• Reduced CO2 emissions from operations and transportation by 29% compared to 2019
• Switched global production network to sourcing 100% renewable power

Social Achievements

• Reached close to 5.5 million patients through access and affordability initiatives
• Increased share of women in senior leadership positions to 39% from 36% in 2021
• Launched three global aspirational targets in 2021 for diversity and inclusion

Governance Achievements

• Launched Sustainability Advisory Council in April 2022
• Achieved a reputation score of 82.3 points out of 100
• Executive compensation linked to ESG performance

Climate Goals & Targets

Environmental Challenges

• Higher than expected demand leading to shortages of certain products
• Capacity limitations at manufacturing sites
• Increasingly difficult macroeconomic and geopolitical environment
• Supply chain constraints forcing increased use of airfreight

Mitigation Strategies

• Invested around DKK 12.7 billion in 2022 to expand capacity
• Restructuring supply chains to increase resilience
• Operating global manufacturing facilities 24/7
• Alliances with Kuehne+Nagel and SkyNRG for Sustainable Aviation Fuel
• Shifting production sites towards biogas

Supply Chain Management

Supplier Audits: 294/year

Responsible Procurement

• Supplier sustainability requirements
• 100% renewable power sourcing target for suppliers by 2030

Climate-Related Risks & Opportunities

Physical Risks

• Flooding
• Storm surges
• Earthquakes
• Tornadoes
• Wildfires

Transition Risks

• Regulatory changes
• Market shifts

Reporting Standards

Frameworks Used: CDP, Value Reporting Foundation (VRF) / Sustainability Accounting Standards Board (SASB), TCFD, UN Global Compact, UN Guiding Principles Reporting Framework

Third-party Assurance: Deloitte Statsautoriseret Revisionspartnerselskab

Sustainable Products & Innovation

• Heat-stable insulins

Awards & Recognition

• Best place to work globally by "Best Places to Work"

Environmental Metrics

ESG Focus Areas

• Climate change
• Patient protection and quality of life
• Business conduct
• Resource use and circular economy
• Workers' wellbeing
• Biodiversity and ecosystems
• Water and marine resources
• Sustainable tax
• Pollution
• Affected communities
• Bioethics

Environmental Achievements

• Reduced CO2 equivalent emissions from operations and transportation by 34% vs 2019 (8% reduction vs 2022)
• 100% renewable power sourcing at all production sites since 2020
• Established the world’s first industry solution for recycling injection pens in Denmark

Social Achievements

• Reached 40.5 million people with diabetes medicines (4.2 million increase from 2022)
• Reached 6.7 million people living with diabetes globally with insulin medicines through access and affordability initiatives
• Expanded partnership with UNICEF to address childhood obesity, aiming to reach 10 million children globally
• Increased share of women in senior leadership positions to 41% from 39% in 2022
• Achieved 86% employee engagement score in 2023

Governance Achievements

• Established a Sustainability Advisory Council in 2022
• Executive remuneration linked to progress on sustainability targets
• Implemented a new global code of conduct
• Increased number of business ethics reviews to 40 in 2023 from 35 in 2022
• 99% of employees completed mandatory business ethics training

Climate Goals & Targets

Environmental Challenges

• Supply chain pressure resulting in periodic constraints across product portfolio due to surging demand
• Growing burden of chronic diseases on healthcare systems
• Minimising the use of plastic derived from fossil fuels in medical injection devices
• Improving affordability and access to care for vulnerable patients globally
• Addressing the obesity pandemic holistically

Mitigation Strategies

• Investing heavily in expanding production capacity (more than DKK 75 billion in 2023)
• Changing product launch and distribution methods to ensure responsible access to treatment
• Production partnership with Aspen Pharmaceuticals in South Africa to increase affordable insulin supply to Africa
• Expanded affordability offerings in the US (unbranded biologics, low-cost human insulin, Patient Assistance Program)
• Strengthened focus on public-private partnerships and established a Transformational Prevention Unit for obesity prevention
• Focusing on supply chain emissions by supporting transition to 100% renewable power among 60,000+ suppliers
• Threefold ‘reduce-change-avoid’ approach to tackle plastic challenge (reduce consumption, change to non-virgin plastics, recycling)

Supply Chain Management

Supplier Audits: 382 audits/year

Responsible Procurement

• Identifying and implementing levers within high-impact scope 3 categories
• Engaging with suppliers in high-impact areas to understand how to collectively reduce emissions

Climate-Related Risks & Opportunities

Physical Risks

• Adverse local weather conditions

Transition Risks

• Regulatory changes
• Market shifts

Opportunities

• Development of energy-efficient products
• Innovative Power-to-X solutions

Reporting Standards

Frameworks Used: GRI, VRF, TCFD, UNGC, CDP, EU Taxonomy

Certifications: Null

Third-party Assurance: Deloitte Statsautoriseret Revisionspartnerselskab

UN Sustainable Development Goals

• Goal 3 (Good health and well-being)
• Goal 12 (Responsible consumption and production)

Initiatives contribute to improving healthcare access and reducing environmental impact

Sustainable Products & Innovation

• Reusable devices
• Once-weekly insulin formulations
• Lower-carbon plastics

Awards & Recognition

• Not disclosed