GSK Corporate Responsibility Report 2013 62

Taking a scientific approach to sustainability The sourcing of raw materials and the complex, energyintensive chemical processes involved in transforming them into our products accounts for around half of our value chain carbon footprint.
Over the last five years, we have been using innovative technology to reduce environmental impacts associated with manufacturing active pharmaceutical ingredients
– the substances in our drugs that treat or prevent illness. Following trials in

Jurong, Singapore, teams at the eight facilities where we produce active ingredients are implementing holistic improvement plans which are bringing significant environmental benefits and cost reductions.
Infrastructure investments included installing a biogas plant at Irvine,
UK, a combined heat and power facility in Worthing,
UK, and a photo oxidation system for waste treatment in Singapore. Our site in
Cork, Ireland, where we

are now bio-treating waste and recovering the energy produced, achieved zero waste to landfill for the third year running in 2013, and has cut water use by 57% and carbon emissions by 41% since 2008.

in the world). This innovative process will significantly cut our carbon emissions by reducing cooling requirements, as well as producing less organic waste.

Many of the improvements we are making take time to
We are also making changes implement. But across all to the chemical processes eight sites, we have already themselves. For example, we cut energy use by 4%, CO2 are investing in a new process emissions by 12%, water use at our facility in Quality Road, by 10% and waste to landfill by 82% since 2010.
Singapore, which uses enzymes in the manufacturing of amoxicillin (one of the most widely prescribed antibiotics

GSK Corporate Responsibility Report 2013 63

Carbon

We have set ambitious targets to achieve a carbon neutral value chain by 2050.
We are reducing operational carbon emissions, and engaging with suppliers and consumers to cut emissions associated with sourcing raw materials and using our products.

Understanding our 2013 value chain carbon footprint

Raw materials

GSK’s operations

Logistics

Use of our products

Disposal

We are working with suppliers to reduce the impacts associated with sourcing raw materials, as well as exploring ways to use resources more efficiently in our products.

We are investing in technology, efficiency measures and renewable energy to reduce carbon emissions from energy use in our operations. We also generate carbon emissions during the production of propellant-based inhalers and from employee travel.

We aim to minimise carbon emissions from transporting our products to customers by using sea freight rather than air and by redesigning packaging to make transportation more efficient.

Some of our products, particularly propellant-based inhalers, generate carbon emissions during use by patients and consumers.

We have established an inhaler recycling programme and engage with patients to reduce emissions associated with disposal of our products.

40%

5.6m*

14%

1.8m

tonnes CO2e per annum

tonnes CO2e per annum

1.3m

tonnes CO2e per annum

0.25m

tonnes CO2e per annum

Energy

HFA and process emissions 0.1m

Business travel

0.2m

Sales force

tonnes CO2e per annum

tonnes CO2e per annum
* This is an estimate

1%

0.2m

44%

6.3m

tonnes CO2e per annum

0.2m*

tonnes CO2e per annum

5.3m

tonnes CO2e per annum

1.0m*

tonnes CO2e per annum

1%

tonnes CO2e per annum

Use of metered dose inhalers
Use of other products Total emissions

15m

tonnes CO2e per annum

GSK Corporate Responsibility Report 2013 64

Carbon continued Performance in 2013

Operational impacts
Reducing energy use, and the carbon emissions associated with generating
Commitment
energy that we purchase, is an important
Reduce our overall carbon footprint by 25% by 2020 focus of our programme to cut
(vs. 2010) and have a carbon neutral value chain environmental impacts. We are investing by 2050. in energy-efficient technologies and
In 2013, our Scope 1 and 2 emissions, increasing our use of renewable energy. those in our operational boundaries, were
For example, at our facility in Irvine, UK,
1.83 million tonnes CO2e, a slight increase of we are introducing a series of alternative
0.6% compared to 2012, but a 7% reduction energy sources, including a £3.7 million since 2010. The investments we made in wind turbine and an anaerobic digester
2013 will start to deliver further carbon that will use waste from the site to generate emission reductions in 2014 (see chart). energy. The combined heat and power plant we installed in 2010 is already reducing the
In 2013, our Scope 3 emissions, such as cost of producing our antibiotics at the site those associated with logistics, business by £650,000 annually. travel and patients’ use of our HFA propellantbased inhalers, increased by 1.5% compared to 2012 – an overall increase of 11% since
2010 (see chart). Tackling our Scope 3 emissions continues to be a challenge,
Scope 1 & 2 GHG Emissions especially as our product sales continue to
2,500,000
increase. In particular, we are looking at long-term options to reduce our carbon
2,000,000
emissions related to Ventolin whilst still meeting patient needs and preferences.
Product impacts
We are using carbon footprint analyses of our top 35 products to identify where we can make the most effective reductions from emissions associated with our products – from sourcing raw materials, to manufacturing, to use and disposal.
For example, in 2013 we reduced the amount of propellant (HFA134a, a powerful greenhouse gas) used to purge aerosol cans of air before they are filled with Ventolin.

1,500,000

Our vaccines site in Tuas, Singapore, has installed a trigeneration plant which uses waste energy generated in the production of electricity for heating and cooling. This has improved energy efficiency by 15-20%, and saved around £1 million a year. In 2013, the site’s achievements were recognised by the Singapore Energy Efficiency National
Partnership Awards in the Best Practice category. By improving efficiency, these measures have prevented the site’s total energy consumption from rising even as production volumes increased.
We continue to identify opportunities for profitable energy and carbon emissions reductions at all our sites around the world.
In 2013, for example, we increased the amount of biomass used as a fuel, replacing coal at two sites in India.
Scope 3 GHG Emissions

12,000,000
10,000,000

6,000,000
4,000,000

500,000
0

2,000,000
0

2010

2011

2012

Gas & other fuel
Electricity & steam
Propeliant emissions during manufacture of inhalers
Sales force travel
Other emissions

2013

During the year we also received the
Carbon Trust’s Best in Continuing Carbon
Reduction award for year-on-year reductions in emissions associated with our operations. This followed our global certification to the Carbon Trust Standard in 2012, which we will renew in 2014.
We continue to work with the Association of the British Pharmaceutical Industry and the
UK National Health Service Sustainable
Development Unit. Following the development of carbon footprinting guidelines for the pharmaceutical sector in
2012, together we launched a tool to help companies calculate the carbon footprint of tablet medicines that are distributed in blister packs.

14,000,000

8,000,000

1,000,000

External recognition and partnerships
In 2013, our achievements in cutting carbon emissions across our value chain were recognised by the CDP, a not-for-profit organisation providing a global framework to measure companies’ impacts on the environment. GSK was the only healthcare company listed in the Global 500 climate change report 2013, to be ranked in the
CDP Performance Leadership Index, and the CDP Disclosure Leadership Index for both our performance and the quality of our reporting. Our 2013 CDP submission is publicly available on the CDP website.

2010

2011

2012

Purchased materials
Product logistics
Business travel by air
Propellant emissions during use of inhalers
Use of other products
Disposal of products

2013

GSK is also a member of the UN Caring for
Climate programme, an initiative that is increasing businesses’ role in addressing climate change.

GSK Corporate Responsibility Report 2013 65

Water

To reduce the overall water impact associated with our products, we are working to reduce suppliers’ and consumers’ water use, as well as targeting reductions in our own operations.

Each year, we conduct a high-level assessment of water use in our global operations, using the World Business
By 2020, reduce our water impact across the value
Council for Sustainable Development’s chain by 20% (vs. 2010).
Global Water Tool to help us identify where we can save water and respond to potential
Mapping our water footprint across water risks. Four countries – Belgium, India, our value chain the UK and the USA – account for 70%
We use more than 15 million cubic metres of our total water use. We also use the of water a year in our operations – research
WBCSD tool and information on local laboratories, manufacturing facilities and watersheds to identify operations in areas offices. But this accounts for just 1% of our Reducing water use in our operations
In 2013, we achieved a further 2% reduction of water scarcity. total water footprint. The remaining 99% of in water consumption in our operations, our footprint relates to water used in the keeping us on track to meet our 2015 target We have developed a systematic approach rest of our value chain (see chart). To to cut operational water use by 20% (from to find opportunities to save water at sites reduce our overall water impact, we need the 2010 baseline). with high volume use, where consumption is to explore ways to reduce our suppliers’ and increasing and in areas where water is scarce. consumers’ water use too.
Commitment

This analysis will help us develop effective programmes to meet our 2020 commitment to cut water impact by 20% across our value chain. For example, we have already begun efforts to address consumer water use by using our toothpaste brands to launch ‘Turn off the Tap’ campaigns in Italy and Puerto Rico, which encourages people to use less water when brushing their teeth.

Working with external experts to gain a better understanding of our water footprint and where our biggest impacts are, we estimated the total water footprint associated with our products was 1,540 million m3. The production Net water consumption in our operations of raw materials used to make our products
Estimated Value Chain Water Footprint* account for the vast majority of our footprint, and the second biggest contributor is
Million cubic metres consumer use of our products (see chart).
This initial high-level assessment helped us determine where we need to more accurately investigate water consumption in our value chain – including water use in the agricultural supply chains for the milk, malt, wheat and glucose that goes into some of our products, and water in the use of our toothpaste by consumers. We are also starting to understand where in the world our water use has a high impact on the environment and communities.

2010

2011

2012

2013

18.7

17.4

16.1

15.7

Estimated Value Chain Water Footprint*

Water used to produce raw materials
Water used to generate purchased energy
Water used in our operations
Water used by consumers and patients using our products
* Based on an analysis of 2010 data and latest version conversion factors
Water used to produce raw materials
Water used to generate purchased energy
Water used in our operations

84%
2%
1%
13%

We rolled out improvement programmes in Pakistan and Kenya in 2012, followed by the UK and India in 2013, and we are starting to see results. For example, our
Horlicks manufacturing plant in Slough,
UK – which was our second biggest consumer of water – has reduced water use by 56% since 2010.
External recognition and partnerships
We are working with NGOs to develop a long-term strategy that will address issues of water scarcity, water quality, and regulatory risk and help reduce potential impacts on communities. This builds on the commitments we made in the UN CEO
Water Mandate, an initiative that helps companies develop and implement sustainable water practices which GSK signed in 2009.

In 2013, GSK became the first company to be awarded global certification to the Carbon
Trust’s Water Standard in recognition of our
2015
year-on-year reductions in water use, and the
Target
way we manage and measure water across
14.9 our global operations. We also respond to the
CDP Water Disclosure Project each year and our latest submission is publicly available on the CDP website.

GSK Corporate Responsibility Report 2013 66

Waste

Our goal is to halve operational waste by 2020. We are doing this by adopting four simple steps to eliminate, reuse, recycle and generate energy from waste – in that order of priority.
Operational waste

Commitment
By 2020, reduce our operational waste by 50%
(vs. 2010).

In 2013, we generated 11% more waste than in 2012 as a result of business growth.
During the year we sent only 6% of our total waste to landfill and 37 of our sites have now achieved zero waste to landfill – up from 34 in 2012. By 2020, we aim to halve our operational waste compared to 2010 and and have zero waste to landfill.
We recognise that as our business continues to grow we need to continue our efforts to reduce waste that our sites generate. We have identified which sites are responsible for generating the majority of our waste and in 2014 we will have an increased focus on developing and implementing improvements at 4 high impact manufacturing sites in addition to our established programme to reduce waste.
Efforts to cut waste to landfill include reusing refrigerated packaging from shipping vaccines as an insulation material for the construction industry, which saves
64 tonnes of waste a year that we previously paid to send to landfill. At our sites in
Barnard Castle and Montrose, UK, we have set up centralised points of collection for waste and are using smaller bins that are more frequently emptied to encourage employees to use them more regularly.

2010

2011

2012

2013

2015
Target

2020 commitment Total waste generated
(thousand tonnes)*

178

170

151

167

133

89

Waste to landfill
(thousand tonnes)

17.5

Read more online
We publish more detail online on key issues including:
Climate change

13.5

10.0

10.5

12.9

0

* In 2013, we changed the way we report on waste and no longer include solvent waste that is recycled and reused on site as part of the total waste generated.

Breathing life into old inhalers
Around 63% of the 73 million inhalers used in the UK every year go in the rubbish bin; most end up going to landfill.
GSK’s inhaler recycling programme,
Complete the Cycle, encourages patients to return their old inhalers to participating pharmacies, which are then sent back to us to be recycled. Not only does this reduce waste sent to landfill, it also

Hazardous chemical management
Genetically modified micro organisms and
Environment, Health and Safety (EHS)
GSK and REACH
GSK and the convention on biological diversity

prevents the remaining propellant in used inhalers being released as greenhouse gases, as we collect it when crushing the cans to recover the aluminium.

GSK public policy on nanotechnology

Now established in the UK and in 31 cities in the USA, the programme has also been set up in several other markets including
Australia, Chile, the Czech Republic and Hungary.

Pharmaceuticals in environment

Ozone depletion and metered-dose inhalers for asthma

The impact of climate change on health
Use of ozone depleting substances in ancillary plant and equipment

GSK Corporate Responsibility Report 2013 67

Managing other impacts

We manage a range of other important issues to reduce our overall environmental impact, in addition to our priority focus areas of carbon, water and waste. our medicines – and to encourage the use of lower-impact alternatives.

Biodiversity
GSK is not directly involved in bioprospecting
– the process of discovering new products
Commitment
We are also investing in research into that come from biological resources, such
Build sustainable supply lines for our Nutrition portfolio sustainable chemistry. In 2013, construction as plants or animals. But we do source a and work with local farmers to improve their agricultural of a carbon neutral sustainable chemistry number of compounds which are derived practices, improve their yields, their competitiveness laboratory began as part of a £12 million and their livelihoods. from biological resources. We take collaboration with the University of responsibility for ensuring these have been
In 2013, we began working with a dairy supplier Nottingham in the UK. We also pledged obtained legitimately and are used in the way in India to develop a secure supply of locally
£400,000 each year until 2024 to establish they are intended. We also support efforts produced whey protein (from milk) to make a Centre of Excellence for Sustainable to conserve biological diversity, such as the
Horlicks. This will benefit the supplier by
Chemistry in São Paulo, Brazil, to advance
Convention on Biological Diversity, the Bonn improving agricultural practices and help us and share knowledge on the subject
Guidelines and the Nagoya Protocol. reduce our environmental footprint. We are now between researchers in Brazil and the UK. sourcing 60% of whey protein from the local
In Singapore, we are funding research into
Packaging
supplier in India and we aim to increase the green and sustainable manufacturing as
We are also working to reduce the amount of locally produced whey protein we part of our partnership with the Singapore environmental impact of our packaging and use to 85% by 2016. Within our product range, Economic Development Board. aim to source 90% of wood fibre material
Horlicks is the second largest source of carbon used for paper packaging from responsible emissions and milk-based products account Pharmaceuticals in the environment sources by 2020. In 2013, we repeated
Pharmaceuticals are not always completely our survey of suppliers of carton board for more than half of its carbon footprint. absorbed or broken down by the body, packaging, corrugated packaging and
Green chemistry and residues can find their way into the leaflet paper and use this information
We apply the principles of green chemistry environment when excreted – or if unused to help us in our purchasing decisions. when producing many of our medicines to medicines are disposed of by consumers. help us reduce or eliminate hazardous
We take this issue seriously and assess the Refrigerants chemicals from the drug development and environmental risk associated with patients’ We have reduced our inventory of discovery process. See GSK’s position use of our products to help ensure that chlorofluorocarbon (CFC) refrigerants, statement on Hazardous Chemicals predicted concentrations do not exceed which deplete the ozone layer, to below
Management for more information. safe levels. We also conduct and support reportable levels. This inventory will be research in this area. For example, we have eliminated within the next five years as
Our Green Chemistry Performance Unit funded two students at the University of remaining equipment containing CFCs
(CPU), established in 2012, researches
York and the University of Cambridge to becomes obsolete. ways to replace hazardous or unsustainable study the impacts of pharmaceuticals in the chemicals with lower impact alternatives. environment as part of their PhD research.
In 2013, we published a specialist guide
Our policy statement on Pharmaceuticals that helps our scientists understand the in the Environment is available online. environmental impact of different reagents – chemicals used to produce

Sustainable supply lines

Environmental remediation
We take responsibility for removing pollution and contaminants from soil, surface and ground water at facilities we have used previously, and at the disposal sites of waste management companies we have used.
In 2013, we spent $5 million on remediation work, compared with US$3.8 million in
2012. We have sole or part responsibility for 28 remediation sites globally.
Compliance and fines
In 2013, we received three environmental fines totalling £2,110. These fines were for late submission of a report about the fuel oil purchased at our sites in Pennsylvania,
USA; improper labelling of an empty road tanker leaving our site in Cork, Ireland; and a discharge of waste that was above the effluent limit in Tianjin, China.
Internal audits
We audit our operations to make sure environmental risks and impacts are identified and managed effectively. Sites are selected for audits based on knowledge of the business, modelling of risk indicators and trends from previous audit findings.
The environmental, health and safety (EHS) audits are conducted by a team of certified
ISO 14001 Environmental Management lead auditors. In 2013, the team audited 27 sites across different business units around the world. The site audits included a review of environmental management systems. In addition we audited our approach and governance processes around our progression towards our 2020 commitments on carbon, water and waste. For information on audits of our suppliers, (see page 45).

GSK Corporate Responsibility Report 2013 68

Engagement

We cannot meet our ambitious commitments without engaging our employees and partners across our value chain, and working with others in our industry to address global environmental challenges.
Employees
Using a range of tools, including online social networks, we build our employees’ understanding of environmental issues and the ways they can help address these collaboratively. Our global network of sustainability advocates within GSK, help to raise awareness among their colleagues about the changes they could make at work and at home to reduce environmental impacts. We recognise teams who have made a particularly valuable contribution to environmental sustainability through our annual CEO’s Environment, Health, Safety and Sustainability Awards (see case study).

Employees recognised for discovering new process that cuts carbon and costs
In 2013, our CEO’s Environment, Health,
Safety and Sustainability Awards recognised an exceptional team of biologists and chemists working across our R&D and manufacturing units. Working collaboratively, the team discovered and developed a new way to manufacture a

chemical that we use in clinical trials for a treatment for Fabry disease – a rare genetic metabolic condition. Using synthetic biochemistry, the new process not only reduces manufacturing costs, but also cuts CO2e emissions by around 80%.

Suppliers
In 2013, we started systematically gathering data from our suppliers on their carbon emissions, water use and waste, building on our engagement with 32 suppliers in 2012.
Using Ecodesk, a publicly accessible database, we asked over 550 suppliers to submit their data to help us better understand and map our suppliers’ sustainability performance. By the end of 2013, 261 of the suppliers we contacted had completed an Ecodesk profile.
We are using this data to prioritise our efforts to reduce suppliers’ environmental impacts. For example, we met with Granules, the company that supplies the active ingredient we use in Panadol. Together, we identified opportunities to reduce energy use by 16% and have set up a collaborative programme to realise these savings.

Industry
We also communicate GSK’s sustainability message and share our experiences externally. In 2013, for example, our Head of Environmental Sustainability was a guest speaker at Cleanmed Europe and CDP’s
FTSE 350 Climate Change Report launch.
Participating in Cleanmed Europe gave us an opportunity to engage with 500 healthcare and pharmaceutical professionals – and gather useful feedback on our performance.

GSK Corporate Responsibility Report 2013 69

Data summary 2010

2011

2012

2013

% vs
2010

570
964
214
165
62
1,975

572
881
223
169
72
1,917

530
804
244
167
77
1,822

533
796
254
177
73
1,833

-6%
-17%
19%
7%
18%
-7%

Scope 3 emissions (’000 tonnes CO2e)
Purchased materials*
Product logistics
Business travel by air
Propellant emissions during use of inhalers
Use of other products*
Disposal of products*
Total

5,600
169
96
4,647
1,000
200
11,712

5,600
200
97
4,760
1,000
200
11,857

5,600
203
98
5,198
1,000
200
12,299

5,600
202
93
5,302
1,000
200
12,398

0%
20%
-3%
14%
0%
0%
6%

Total scope 1 and 2 emissions (’000 tonnes CO2e)

13,687

13,774

14,121

14,230

4%

-10%

Water (million m3)
Water use in our operations

18.7

17.4

16.1

15.7

-16%

-20%

Waste (’000 tonne)
Waste generated**
Waste to landfill

178
17.2

170
13.1

151
10.1

168
10.5

-6%
-39%

-25%
-25%

1.5%

2.8%

2.3%

1.0%

Scope 1 and 2 emissions (’000 tonnes CO2e)
Gas and other fuel
Electricity and steam
Propellant emissions during manufacture of inhalers
Sales force travel
Other emissions
Total

Mass efficiency %***
Weighted average of new processes in calendar year

2015 target 2.5%

* Estimated data (not verified by Bureau Veritas)
** Waste generated no longer includes solvent waste that is recycled on site and reused in processes
*** Mass efficiency is a measure of the amount of raw materials required to make a new active pharmaceutical ingredient, and weighted to account for the scale of manufacture. In 2013, one low volume process was transferred to manufacturing, leading to the lower efficiency figure. We remain on track to achieve our 2015 target of 2.5%, which is an average of performance over five years. We will no longer report mass efficiency because it covers the chemistry stages registered for regulatory purposes, not the complete manufacturing process. We now have an established carbon footprint reduction strategy with a 25% reduction target by 2020 (not verified by BV).

GSK Corporate Responsibility Report 2013 70

Summary of assurance statement Basis of reporting and external assurance
Energy and CO2e emissions data are collected from all 72 of our pharmaceuticals and consumer healthcare manufacturing sites, 16 vaccines sites, 21 pharmaceuticals and consumer healthcare R&D sites, the UK headquarters building and over 60 offices and distribution centres. Water and hazardous and non-hazardous waste data are collected from all our manufacturing vaccines operations, and R&D locations. Based on our materiality assessment, we do not collect non-hazardous waste and wastewater data from offices. Volatile organic compound
(VOCs) are reported only from sites that manufacture pharmaceuticals or contain R&D pilot plants. We use the Greenhouse Gas
Protocol for all of our calculations of
CO2e emissions from energy use, propellants and refrigerants.
We use CO2e country factors for electricity published by the International Energy
Agency in 2013.

Bureau Veritas’ Summary independent assurance statement
Bureau Veritas UK Limited has been engaged by GSK plc to provide independent assurance of the Environment,
Health and Safety (EHS) performance data for 2013 that has been prepared by GSK plc. The objective of Bureau Veritas’ work is to express an opinion on the accuracy and reliability of the EHS data and to provide a summary of findings.
The full assurance statement can be found online that includes details of the scope of work, methodology, findings and recommendations for improvement.
Summary of Scope and Methodology
Assessment of performance data contained within the EHS Data Table and associated data management processes: this involved detailed review of the integrity of selected datasets and aggregation and checking processes at a corporate level, as well as sampling data back to source at four GSK sites. The sites were chosen to represent the facilities with significant environmental impact, GSK operations and geographical spread.

Sites were selected for review from all of the
GSK businesses. Site specific audits were conducted at four sites where data was verified back to source. There was special focus on sites that had been top contributors Interviews with senior EHS staff to understand GSK’s objectives and approach to environmental emissions the previous to data management. year, sites that had not been previously visited in prior years, and sites that had difficulty submitting data in a timely manner.

Opinion and Recommendations
As a result of the verification conducted as per the scope of work, it is Bureau
Veritas’ opinion that GSK’s 2013 EHS performance data: provide a fair summary of EHS-related activities and performance; and contain performance metrics and information that are based on established collection and collation processes, and are deemed to be free from significant error, omission or bias.
The data evidenced at site level was seen to be based on well-established and implemented data management processes and underlying systems.

Bureau Veritas’ Code of Ethics ensures that staff avoid conflict of interest and maintain high ethical standards in their business activities.
GSK’s response to assurance
We are pleased with Bureau Vertitas’ findings on GSK’s established processes in managing
Environment, Health and Safety data. We are committed to continue improving, with the ultimate goal of providing the most accurate
EHS data to the public on our website. In
2014, we will continue to work toward improving our data accuracy with an emphasis on incorporating the recommendations provided by Bureau Veritas. The data in the
Corporate Responsibility Report can be used by sites to improve their management of their environmental, health, and safety programmes.
In 2014, we will continue working with all sites to improve their data submission, including providing comments for the explanation of trends in a complete and timely fashion.

There are certain areas that could lead to further refinement, such as: more complete inclusion of EHS data from the Commercial
Operations business units; and more formal definition and structure to the quality control process for following up anomalies detected Read GSK’s full response to assurance here. in consolidated EHS data. Further detail may be seen in the full assurance statement.
Statement of independence, impartiality and competence
Bureau Veritas is an independent professional services company that specialises in quality, environmental, health, safety and social accountability, with over 180 years history.
The assurance team has extensive experience in environmental, social, ethical, and health and safety information, systems and processes.

London, February 2014