Climate Change Data

IQE plc

Climate Impact & Sustainability Data (2022, 2023)

Reporting Period: 2022

Environmental Metrics

Total Carbon Emissions:22,180 tCO2e/year
Scope 1 Emissions:3,334 tCO2e/year
Scope 2 Emissions:16,751 tCO2e/year
Scope 3 Emissions:1,083 tCO2e/year
Water Consumption:104,630 m3/year
Waste Generated:1,933 tons/year

ESG Focus Areas

  • Net Zero and carbon neutrality
  • Diversity, Equity, Inclusion and Belonging (DEIB)
  • Employee wellbeing
  • Supply chain responsibility
  • Health & Safety

Environmental Achievements

  • 13.32% reduction in absolute emissions in 2022 compared to 2021 due to facility closures and operational scaling down.
  • Achieved ISO 14064-1 certification for GHG emissions reporting.
  • Became a signatory to the Science Based Targets initiative (SBTI), committing to Net Zero by 2050.
  • 100% recycling of GaAs and InP wafer waste.

Social Achievements

  • Increased percentage of female employees from 16% to 18%.
  • 30% of vacancies filled by women in 2022 (up from 21% in 2021).
  • Launched IQE Women’s Network.
  • Increased number of qualified Mental Health First Aiders from 10 to 23.
  • 104% increase in employees accessing employee benefits.
  • One full or two half-days paid employee volunteering leave annually.

Governance Achievements

  • Formalized commitment to Net Zero and carbon neutrality.
  • Established an ESG Committee.

Climate Goals & Targets

Long-term Goals:
  • Increase revenue 3x by 2027
  • Achieve over 30% adjusted EBITDA margin by 2027
Medium-term Goals:
  • Achieve Net Zero and carbon neutrality by 2050.
  • Diversification into high-growth markets of power and advanced display.
Short-term Goals:
  • Implement science-based emission reduction targets.

Environmental Challenges

  • Challenging macro environment with the war in Ukraine, increased energy costs, inflationary pressures, and lockdowns in China impacting semiconductor demand.
  • Global semiconductor industry downturn negatively impacting H1 2023 revenue forecast.
  • High level of customer concentration.
  • Geopolitical risks constraining global trade and semiconductor supply.
  • Supply chain disruptions due to geopolitical events and commodity price spikes.
Mitigation Strategies
  • Equity fundraise and refinancing of banking facility.
  • Cost rationalisation and cash preservation actions.
  • Customer diversification strategy.
  • Product diversification.
  • Market diversification.
  • Diversification of supply through geographically spread manufacturing sites.
  • Securing future supply through 100% renewable energy supply agreements.
  • Increased move towards a circular economy.

Supply Chain Management

Responsible Procurement
  • Commitment to responsible sourcing practices.
  • Expectation of high ethical standards from suppliers.

Climate-Related Risks & Opportunities

Opportunities
  • Development of energy-efficient products.

Reporting Standards

Frameworks Used: Science Based Targets initiative (SBTI)

Certifications: ISO 14064-1, ISO 45001 (multiple sites)

Third-party Assurance: KPMG LLP

Awards & Recognition

  • Best Companies 'One to Watch' status (two years running)

Reporting Period: 2023

Environmental Metrics

Total Carbon Emissions:19,603 tCO2e
Scope 1 Emissions:2,757 tCO2e
Scope 2 Emissions:15,068 tCO2e
Scope 3 Emissions:1,779 tCO2e
Total Energy Consumption:67,844,194 kWh
Water Consumption:134,124 m3
Waste Generated:2,015 tons

ESG Focus Areas

  • Climate Change
  • Diversity, Equity, and Inclusion (DE&I)
  • Supply Chain Management
  • Employee Wellbeing
  • Health and Safety

Environmental Achievements

  • 13.51% reduction in absolute emissions (five-year rolling average) compared to 2021 baseline (Scope 1 & 2).
  • 100% recycling of GaAs and InP wafer waste.

Social Achievements

  • Launched Women’s Network.
  • Enhanced UK employee benefits (electric car salary sacrifice, free mortgage brokering).
  • Improved Board diversity.
  • 83% response rate in employee engagement survey ('b-Heard'), achieving 'One to Watch' status.

Governance Achievements

  • Published first TCFD statement.
  • On track to submit SBTi targets within 24-month commitment window.
  • Strengthened Board and Executive Leadership Team with diverse individuals and significant industry experience.

Climate Goals & Targets

Long-term Goals:
  • Net zero emissions by 2050.
Medium-term Goals:
  • Achieve 2028 SBTi targets.
Short-term Goals:
  • Submit Scope 1, 2, and 3 targets to SBTi by end of May 2024.

Environmental Challenges

  • Global semiconductor industry downturn leading to reduced customer orders and revenue.
  • Supply chain disruptions due to Gallium export restrictions by China.
  • High energy pricing.
Mitigation Strategies
  • Successful £30m equity fundraise and refinancing of credit facility.
  • Cost rationalisation actions (headcount reduction, deferred capital expenditure, operational efficiencies).
  • Increased recycling of Gallium to reduce reliance on Chinese supply.
  • Working with supply chain partners to transition to cleaner manufacturing methods.

Supply Chain Management

Responsible Procurement
  • Ethical sourcing practices.
  • Commitment to cleaner manufacturing methods from supply chain partners.

Climate-Related Risks & Opportunities

Physical Risks
  • Supply chain disruptions due to extreme weather events.
  • Business interruption, damage to assets, harm to people due to extreme weather.
Transition Risks
  • Failure to meet climate reporting expectations.
  • Increased energy and carbon tax costs.
Opportunities
  • Increased demand for products enabling improved efficiency and clean energy (GaN-based power semiconductors).

Reporting Standards

Frameworks Used: TCFD, SBTi

Certifications: ISO 14001, ISO 45001

Third-party Assurance: KPMG LLP

Sustainable Products & Innovation

  • GaN-based power semiconductors.

Awards & Recognition

  • Raytheon Premier Supplier Excellence Award
  • BAE Systems Gold Tier Supplier Award