ESG governance
ESG (Environment, Social, Governance) covers the cornerstones of corporate sustainability. As a term, it summarises sustainability issues within the sphere of influence of a company’s own activities.
Geberit has been committed to sustainability for over 30 years. A sustainability-oriented business management philosophy is considered one of the key strategic success factors. The sustainability strategy is fully integrated in the corporate processes and, with its focal points, strengthens the Business model and thus the company's long-term value creation.
The Board of Directors is responsible for the sustainability strategy as well as key mission statements and principles such as the Geberit Compass and the Geberit Code of Conduct, see Business Report > Corporate Governance > Board of Directors. These key mission statements and principles are drawn up by the operational management.
The Group Executive Board is also responsible for implementing the sustainability strategy. Within the operational management structure, responsibility is delegated further to individual departments and areas for specific economic, environmental and social issues. The responsible individuals report either directly to the CEO (Corporate Human Resources, Corporate Communications and Investor Relations, Strategic Planning), or to other members of the Group Executive Board. The Sustainability department reports directly to the CEO. It coordinates the further development of the sustainability strategy and the climate transition plan including the CO2 strategy. Furthermore, it is responsible for Group-wide process management and ISO certification. Since 2023, “sustainability and compliance” has been an additional function within Corporate Purchasing. The production plants as well as Logistics and Corporate Purchasing are responsible for the topics “production”, “logistics” and “procurement”. A network of EHS managers (EHS: Environment, Health & Safety) at the production plants supports the implementation of the sustainability goals around the world. Best practices are shared and Group-wide standards and processes are further developed at the annual EHS manager meeting.
The sustainability report (report on non-financial matters pursuant to Art. 964a ff. CO) is examined and approved by the Board of Directors and Group Executive Board as part of the annual report. This includes the review of impacts, risks and opportunities in terms of sustainability, the materiality analysis and the sustainability strategy together with results and achievement of objectives. The annual review by the Group Executive Board and Board of Directors also covers the business report on the subject of “climate change” in accordance with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) Art. 964a ff. CO Content Index with the climate-related risks and opportunities it contains as well as the climate transition plan, SDG Reporting, and the internal report including the audit results with respect to adherence to the Code of Conduct.
Key figures on energy consumption and CO2 emissions are presented monthly and key figures on occupational safety quarterly to the Group Executive Board. These key figures are presented to the Board of Directors once annually.
All positions involved in the sustainability strategy and its implementation, with the corresponding tasks and responsibilities, are listed in the graphic below.
ESG governance at Geberit
Geberit also discloses the efforts it makes with regard to corporate sustainability for external ratings. For several years now, the company has been recognised for its sustainability management by the renowned ranking platform EcoVadis, most recently with a Gold rating.
Sustainability performance of the governance bodies
The members of the Board of Directors contribute in-depth knowledge from their respective areas of expertise and together ensure that the governing body has all the necessary competencies – including sustainability topics, see Business report > Corporate Governance > Board of Directors.
Geberit regularly consults a Stakeholder Panel, and last did so in 2022. The panel’s mandate is to give feedback on the sustainability performance, materiality analysis, CO2 strategy as well as on strategic topics such as diversity, inclusion and ESG governance. The insights gained are incorporated in the strategic review and continued development of the company. In the reporting year, a new Materiality analysis was carried out in accordance with the European Sustainability Reporting Standards (ESRS). This necessitated the active participation of the panel members, which is why the Stakeholder Panel that takes place every other year was postponed.
In accordance with the Organisational Regulations, the Board of Directors assesses its collaboration at least once a year. This includes an assessment of how well-informed the members of the Board of Directors are about the Group and its business performance and the expertise contributed by the Board of Directors. There is currently no formal procedure for assessing the performance of the Board of Directors from an integrated sustainability perspective. However, results are discussed and necessary measures defined as part of the annual review of the sustainability strategy.
Dealing with conflicts of interest and critical concerns
Conflicts of interest concerning the number of permissible activities are avoided via the Regulations in the Articles of Incorporation. The Organisational Regulations of the Board of Directors stipulate how conflicts of interest of members of the Board of Directors are avoided. The members of the Board of Directors are obliged to refrain from involvement in matters affecting either their personal interests or those of a company with which they have an affiliation. This obligation to refrain from involvement has no influence on the quorum required for decisions. Business dealings between the company and members of the Board of Directors or related parties must be concluded under the same conditions as with third parties.
The Board of Directors is available to address the concerns of stakeholders and shareholders, see Business Report > Corporate Governance > Participatory rights of shareholders. Matters brought forward by shareholders within the context of the General Meeting are dealt with in accordance with the Articles of Incorporation of Geberit AG. No matters were submitted directly to the Board of Directors outside the General Meeting in 2024. The employee representatives of the European sites meet regularly with a member of the Group Executive Board and the Head Corporate Human Resources. Concerns can be addressed to the Board of Directors through this channel. There is no employee representative on the Board of Directors.
Remuneration policy for governance bodies
The Geberit Group publishes a detailed annual remuneration report, which discloses the precise points of remuneration paid to the Board of Directors and Group Executive Board as well as the remuneration policy. The Group’s remuneration policy states that remuneration programmes must be balanced between the reward of short-term success and long-term value creation. For information about the remuneration of the management bodies, see Business Report > Remuneration Report.
Since 2022, the achievement of objectives regarding the reduction of the relative CO2 emissions (CO2 intensity) has been integrated as an equal fifth criterion in the bonus matrix for members of Group management as well as employees in Switzerland. This means the annual objectives for emissions are now relevant to bonuses for some 220 managers worldwide and a total of around 1,350 employees in Switzerland.