Cemex

No leading practices were identified for this company.

Cemex demonstrates leadership in climate scenario testing through comprehensive company-wide analyses that incorporate a variety of risks including technological, reputational, legal, regulatory, market, and physical factors. It employs robust scenarios like the Stated Policies Scenario (STEPS), Sustainable Development Scenario (SDS), and Net Zero Emissions by 2050 Scenario (NZE) to explore short, medium, and long-term impacts until 2050. The testing includes quantitative financial projections such as regional carbon prices and demands for cement and low-carbon products.

Cemex has effectively increased its commitment to sustainability by enhancing its Alternative Fuels Substitution rate to 35%. This improvement was achieved through a strategic investment of 1.6 million USD in late 2020, targeted at its plant operations. The project, completed in 2022, enabled the company to raise its alternative fuel usage from 20% to 35%, significantly reducing its reliance on petcoke.

Cemex has a comprehensive supplier engagement strategy, which emphasises information collection, innovation and collaboration, engagement and incentivisation, and compliance and onboarding. The company’s activities to influence suppliers to reduce their emissions including the requirement for critical suppliers to complete questionnaires incorporating climate change key performance indicators.

While Cemex has set comprehensive targets for emissions reduction, the absence of detailed mitigation measures for emissions resulting from its purchased clinker and cement, which accounted for 13% of its total carbon emissions in 2022, presents a risk. This gap could potentially impede the company’s progress towards its 2030 and 2050 targets. Additionally, an increase in power consumption per tonne of cement from 2021 to 2022 suggests the company faces challenges in improving operational energy efficiency, which may hinder the achievement of its scope 2 emissions reduction goal.

Cemex’s ambitious decarbonisation strategy lacks clarity and comprehensiveness. The lack of detailed growth projections for low-carbon business models, such as its Vertua lower carbon concrete, and the challenge in meeting low-clinker cement production standards, point to potential gaps in the execution of its transition plan. Furthermore, the partial application of SMART goal-setting criteria, ambiguous alignment with performance indicators, and failure to consider the full value chain in its transition plan could hinder the company’s ability to achieve its net-zero ambition.

Cemex lacks transparency and specificity regarding its R&D investments and the impact of these investments on its low-carbon initiatives. This creates uncertainty about the effectiveness and scale of its commitment to sustainability. Furthermore, though the company’s action to transition 33% of its electricity consumption for cement production to clean energy is commendable, the overall increase in its power consumption and the absence of detailed future capital expenditure plans for low-carbon projects present risks to Cemex’s operational sustainability and its long-term environmental targets.

Cemex does not require mandatory emissions targets and reporting from its suppliers. It also fails to sufficiently incorporate low-carbon transition aspects in its client engagement strategy. Additionally, while the company aims to align its trade association memberships with the Paris Agreement goals, the lack of clear oversight and detailed processes for assessing and ensuring alignment poses risks to maintaining consistent advocacy for climate action across all its operations and associations.

Cemex plans to achieve its emissions targets through increased use of alternative fuels, aiming for a 35% substitution rate, and through 65% clean energy use in cement production by 2030. Further, investments in CCUS technologies and internal carbon pricing guide the company’s operational decisions.

Cemex’s climate strategy is consistent with the Paris Agreement. It integrates financial aspects into its five-year business strategy and has set updated targets that align with the 1.5°C scenario. However, the company can strengthen its strategy by providing detailed actionable plans and considering its entire value chain.

Cemex has established a climate strategy overseen by a dedicated committee and supported by board members with climate change experience. It’s Vertua lower carbon concrete, offered in over 80% of its markets, contributes significantly to its sales volumes.

Cemex has transitioned 33% of its electricity consumption for cement production to clean energy sources. It continues to develop low-carbon products, such as Vertua Ultra zero concrete, and focuses on recycling concrete and using alternative fuels.

Cemex plans to achieve its targets through increased use of alternative fuels, aiming for a 35% substitution rate, and through 65% clean energy use in cement production by 2030. The company invests in CCUS technologies and uses internal carbon pricing to guide operational decisions.

The company publicly discloses a commitment to engaging in social dialogue with workers and unions. However, no relevant disclosure was found regarding the categories of stakeholders it engages with on a just transition. Nor was there any evidence to show the company’s ongoing social dialogue and meaningful engagement with affected stakeholders.
No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

No public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s actions to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups.
No relevant disclosure was found of the company’s assessment of employment dislocation risks. The company has a commitment to reskill and upskill workers and stakeholders affected by the low-carbon transition. However, no evidence was found that the company reskills and upskills workers in a way that ensures gender balance and inclusion of vulnerable groups.

No relevant disclosure was found to show if the company identifies the impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social their protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders.
No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights and the ILO fundamental rights at work, and it expects its business relationships to respect the ILO fundamental rights at work. Furthermore, the company discloses a human rights due diligence process that includes the identification and assessment of salient human rights risks. The company takes action to mitigate these risks in its own operations and supply chain, and it engages with affected stakeholders. Additionally, the company has a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment from its business relationships. However, no evidence was found of the company having a time-bound target for paying all workers a living wage. While the company discloses the proportion of its direct workforce covered by collective bargaining agreements, no relevant disclosure was found of the company’s required working hours. The company discloses some indicators of workforce diversity, such as the age and gender of its workforce by employee category. However, no relevant disclosure was found of additional indicators of workforce diversity. Nevertheless, the company has a commitment to promote gender equality and women’s empowerment.

The company commits to protecting personal data. However, no evidence was found of the company having a privacy statement regarding the collection, sharing and access to personal data. While the company discloses its global tax strategy, no relevant disclosure was found of the corporate income tax it pays in each relevant jurisdiction. The company has a policy prohibiting bribery and corruption, and it includes corresponding clauses in its business relationship contracts. Furthermore, the company has a lobbying and political engagement policy. However, no relevant disclosure was found of its expenditure on lobbying activities.