SIG

Between 2017 and 2022, SIG reduced its emissions intensity by 3% annually. If the company can continue this trend over the next five years, it will stay aligned with its 1.5°C pathway. The projected decrease in SIG’s future scope 1 and 2 emissions intensity between 2022 and 2027 is consistent with its 1.5°C pathway.

No leading practices were identified for this company.

No leading practices were identified for this company.

No leading practices were identified for this company.

While SIG’s current emissions align with its proposed targets for reducing scope 1 and 2 emissions intensity until 2030, none of these targets have been validated by the SBTi as aligned with either the 1.5°C or well below 2°C scenarios. Furthermore, the company has not set a target to reach net-zero emissions by 2050. SIG should develop a long-term target that aligns with a 1.5°C pathway and covers its scope 1, 2 and 3 emissions. Additionally, the company should set intermediate targets at gaps of no more than five years to incentivise near-term action on longer-term goals.

Although SIG’s board oversees climate matters, none of the board members were found to have significant expertise in the low-carbon transition. The company’s 2030 Sustainability Road Map proposes concrete short-term actions; however, the company should extend the time scale of this strategy to cover the long term until 2050 or beyond. Further, the strategy should contain quantitative financial estimations of how the company’s business will change in the future. Similarly, SIG can enhance its climate scenario analysis by incorporating a broader range of parameters and assumptions, as well as factoring in carbon pricing. The company should also align revenue disclosures for low-carbon products with the EU Taxonomy standards. There is potential for the company to broaden its low-carbon business models, such as developing zero-clinker cement products or enhancing the use of biomass, and to share the projected growth of these activities.

While SIG has disclosed its overall research and development (R&D) spending and provided examples of its low-carbon investments over the past two years, there is room for improvement in its reporting practices. Specifically, it can strengthen its disclosure by either directly reporting its total R&D expenditure on low-carbon technologies or by providing related low-carbon investment figures for the reporting period. Additionally, it can work to increase the share of alternative fuels it uses, which is currently less than 10%.

SIG does not publicly disclose strategies for engaging suppliers and clients to promote emissions reduction and the low-carbon transition. Although the company’s recent client engagement efforts involve educating them about non-OPC products with lower clinker content, these efforts can be integrated into a broader engagement strategy with its suppliers and clients with a defined scope, quantified emissions reduction targets and low-carbon requirements and recommendations. Additionally, though the company has a public policy engagement strategy, it should make it publicly accessible. There is an opportunity for the company to ensure coherence between its climate change policy and the positions taken by the trade associations it is affiliated with, while also establishing a contingency plan in case of misalignment. In addition, SIG should establish a monitoring and review process to ensure that its policy positions align with the Paris Agreement goals.

SIG is committed to reducing its scope 1 emissions by 27% per tonne of cement equivalent from 2010 levels, targeting 515 kg CO2/tonne by 2025, with an interim goal of 550 kg CO2/tonne. Additionally, the company plans to reduce its scope 2 emissions by 23.9% per tonne of cement equivalent from 2019 levels, aiming for 51 kg CO2/tonne by 2025, with an interim target of 60 kg CO2/tonne.

While SIG supports the Indonesian government’s endeavors to achieve its Net Zero Emissions (NZE) commitment by 2060, the company’s 2030 Sustainability Road Map does not target achieving net zero by 2050, nor does it outline long-term goals for further decarbonising its operations beyond 2030.

Between 2017 and 2022, SIG reduced its emissions intensity by 3% annually. The company is expected to stay aligned with its 1.5°C pathway if this trend continues. The company reduced its scope 1 emissions intensity from 593 kg CO2/tonne of cement equivalent in 2021 to 590 kg CO2/tonne in 2022. It achieved this mainly by prioritising a programme to increase the proportion of alternative fuel use thermal substitution rate (TSR) since 2021 through the addition of alternative fuel feeding facilities at in a number of its plants.

SIG’s R&D expenditure decreased from USD 2.4 million in 2021 to USD 1.7 million in 2022. However, the company does not disclose the amount invested in low-carbon and non-mature technologies. Additionally, while the company disclosed its total capital expenditure for 2022, details on its low-carbon capital expenditure and revenue from EU Taxonomy-aligned low-carbon products are unavailable.

As part of its 2030 Sustainability Road Map, SIG aims to reduce its scope 1 and 2 emissions by 2030, with interim targets for 2025 for both types of emissions. The company’s activities include increasing alternative fuel use to replace fossil fuels, incorporating alternative raw materials to decrease the clinker factor, and optimising production processes through advanced process control applications and thermal energy efficiency. Additionally, SIG plans to introduce hydrogen technology to address its scope 1 emissions. For scope 2 emissions, the company aims to enhance electricity energy efficiency through digitalisation and introducing solar panel technology.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate 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. Further, no public commitment by the company was found stating its intention to reskill and upskill workers displaced by the transition to a low-carbon economy. Additionally, 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 their social 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 has a grievance mechanism available to workers and external stakeholders where human rights issues can be reported. However, no other company policies or commitments related to respect for human rights were found in the public domain. This includes the necessary policies and systems by which the company can ensure respect for basic human rights in its operations and supply chain.

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. The company discloses the proportion of its direct workforce covered by collective bargaining agreements. It can, however, strengthen its disclosure on these subjects and other key decent work issues, such as women’s empowerment and living wages.

The company has a policy prohibiting bribery and corruption, and it includes corresponding clauses in its business relationship contracts. Additionally, the company discloses its lobbying and political engagement approach. It can, however, strengthen its disclosure on these and other ethical business topics, such as personal data protection and responsible tax practices.