THE POWER OF VALUES: SUSTAINABILITY @ MUNICH ELECTRIFICATION
Sustainability is on everyone’s lips. For us at Munich Electrification, it is one core value that determines our business, our decisions and our people. By establishing this company value, the course has been set for our way forward. As with the other core value, entrepreneurial spirit, sustainability can be understood in many different ways and associated with diverse aspects as the term is very comprehensive and covers a great variety of topics. What comes to your mind first when you think of sustainability? Is it climate, is it biodiversity, is it human rights, is it business conduct or is it anything else? Truth is, it is all part of it.
by Christina Rechtsteiner
SUSTAINABILITY: A CORE VALUE
When thinking about our current sustainability journey, we like to imagine ourselves in our youth - to be entirely honest. We've already laid down some important foundations. Whether it's embedding sustainability into our core business through our significant contributions to the electrification of mobility and the energy transition with our products, or integrating it into our organization and culture by establishing its value, discussing it within our teams and management, and dedicating resources to it, we're passionately committed to making a positive impact.
Throughout 2023, the sustainability team grew from one to three employees where of one colleague is on parental leave. Isabel is dedicated to various value chain topics like increasing the transparency, minimizing our environmental and social impacts up- as well as downstream including conducting a supply chain risk assessment. Christina, on the other hand, commits herself to corporate aspects, for example the non-financial reporting, sustainability strategy and creating internal awareness.
Speaking of internal interest: 85% of our employees consider it important to work for a company with a sustainable mindset, and 84% were aware that sustainability is one of our company values at the time of hiring (internal survey 06/2024).
"The future understanding of the economy is shifting from 'shareholder value' to 'shared value.' Social and ecological value creation are becoming increasingly important alongside purely economic value creation. This is evident not only in the growing demands of regulation but also in the increasing importance of social and ecological issues for management and employees." — Isabel Palacios
INSIGHTS FROM THE SUSTAINABILITY REPORT 2023
Of course, there is still a considerable way to go in order to fulfill our responsibility and commitment to an empowered future with sustainable practices driving positive change for the planet and people. This includes a strategy with goals and measures for all areas of the company to make the company value inherent to the strategic thrust. Moreover, working on lowering our negative impacts in the entire value chain jointly with partners and suppliers is a crucial and continuous long-term project.
In the latest sustainability report you can find insights regarding our performance on several ESG (Environmental, Social, Governance) indicators for the reporting year 2023. This is the first report of ME that has the requirements of the upcoming non-financial reporting regulation in mind (Corporate Sustainability Reporting Directive CSRD with its European Sustainability Reporting Standards ESRS) that will become mandatory for us in the coming years.
One remarkable novelty is the professionalization of the calculation of the entire Corporate Carbon Footprint (CCF) including all direct and indirect emissions (Scope 1, 2 and 3). Scope 1 includes all direct emissions from burning fossil fuels for company vehicles for example. Scope 2 contains the indirect emissions from utility companies, e.g. from purchased electricity, whereas Scope 3 summarizes all indirect emissions occurring in the upstream or downstream value chain of ME. The latter is a variety of in total 15 categories. The carbon accounting software of a leading provider in that market helped us to obtain the carbon baseline for target setting and reduction achievements for the near- to long-term future. For the CCF of 2023, we already managed to provide over 74% activity-specific data rather than the less accurate spend-based data.
For us at Munich Electrification, the indirect Scope 3 emissions account for over 99% of all emissions associated with our business activities. As we currently partner up with production locations in Germany and Hungary, the assembly of the final products that we deliver is also part of our upstream value chain, i.e. indirect Scope 3 emissions from “Purchased Goods and Services”. More important, the actual reason is that we managed to minimize our Scope 1 and 2 emissions strongly until now. By using 93% renewable electricity and district heating in our offices and providing mainly battery-electric vehicles in the company’s car pool, we have already achieved a lot, so that our Scope 1 and 2 emissions are marginal in the big picture with only 28 tons CO2-equivalents. That is rather uncommon in our industry.
Avoid, reduce, offset - this is the carbon management hierarchy we strictly follow. We decided to not only buy voluntary carbon credits for our Scope 1 and 2 emissions but also three Scope 3 emission categories for which we have reduction measures and rules already in place. These are emissions from “Business Travels”, “Employee Commuting” and “Waste generated in operations”. For 2023, this results in a total of 96 tons CO2e that we offset with an avoidance project promoting safe drinking water in Kenia.
When we take a closer look at our team, we're excited to share that our workforce grew by 50% in 2023. Our team is made up of about two-thirds male and one-third female employees, and we're proud to have a diverse group with around 45 different nationalities represented. One sign of our employee satisfaction is our turnover rate, which is just 1.7%, well below the industry average. For more insights into our ESG performance, we invite you to explore our sustainability report 2023.
You've read through a lot of numbers and figures now, but they highlight an important truth:
It takes more to make mobility more climate-friendly and to contribute to the energy transition. We still have a long way to go. Without action, this remains little more than hot air – and that's the last thing our planet needs. For this and the coming years, Munich Electrification has many projects planned to contribute to a better tomorrow. We are devoted to leading the way in terms of sustainability in the electronic and automotive industry and inspiring our team, customers, suppliers, and other stakeholders.
Munich Electrification’s Sustainability Team: Christina and Isabel
