Building a Future to Smile About.
Sustainability is integrated into Colgate’s business model and aligned with our core values: Caring, Global Teamwork and Continuous Improvement. Our sustainability efforts help ensure our business grows consistently and responsibly, benefits those we serve and promotes the well-being of future generations.
We care about Colgate people, customers, consumers, shareholders and business partners. Colgate is committed to acting with compassion, integrity, honesty and high ethical standards in all situations, to listening with respect to others and to valuing differences. The Company is also committed to protecting the global environment, enhancing the communities where Colgate people live and work, and complying with government laws and regulations.
All Colgate people are part of a global team, committed to working together throughout the world. Only by sharing ideas, technologies and talents can the Company achieve and sustain profitable growth.
Colgate is committed to improving every day. By better understanding consumers’ and customers’ expectations and continuously working to innovate and improve products, services and processes, Colgate teams and individuals will become the best at what we do.
In order to further refine and build upon Colgate’s sustainability strategy, in 2019, Colgate conducted a Stakeholder versus Business Impact assessment. This assessment is recognized by the Global Reporting Initiative (GRI) as a Materiality assessment. We refer to this as a Sustainability Impact Assessment(1).
In 2019, we updated our Sustainability Impact Assessment to meet the expectations of our external stakeholders and to help inform our business decisions. To do so, we first created an extensive list of sustainability-related issues by examining a large number of internal and external sources including the United Nations Sustainable Development Goals (UNSDGs), Global Reporting Initiative (GRI), Sustainability Accounting Standards Board (SASB), Task Force on Climate-related Financial Disclosures (TCFD), Environmental, Social, and Governance rating tools (Dow Jones Standards Indices (DJSI), CDP, Institutional Shareholder Services (ISS), Just Capital, Sustainalytics and Morgan Stanley Capital International (MSCI)), peer reviewed scientific research, industry reports, consumer insights data and employee feedback.
We then assessed the interrelations between these sustainability-related topics and our business through the lenses of risks and opportunities. By conducting a large employee survey, we asked our employees where Colgate can make the biggest impact. We held in-depth interviews with Colgate subject matter experts and function leads to align our findings with business priorities and analyzed data from our consumers to identify moving trends in the market. As a result, we have developed the “Sustainability Impact Matrix” presented below.
The matrix above shows our key sustainability issues, categorized by the impact on our stakeholders and our business in alignment with our three sustainability pillars, People, Performance and Planet. These issues also intersect with the following GRI Standards and define the content of this report: Economic Performance, Materials, Energy, Water, Emissions, Effluents and Waste, Products and Services, Compliance, Transport, Environmental Health and Safety, Training and Education, Diversity and Equal Opportunity, Local Communities, Public Policy, and Service Labeling.
Colgate is managing risks and opportunities related to these issues through the implementation of our 2015 to 2020 Sustainability Strategy. Through our Enterprise Risk Management process, we are focused on the environmental and social impact risk of plastic waste, climate change and water scarcity and access. These same issues also provide an opportunity to drive innovation and growth, strengthen brand reputation and demonstrate our commitment to responsible business practices. Additional detail on each of the issues and our actions to address them is provided throughout the content of the website.
As reflected in the Risk Factors identified in our 2019 Annual Report on Form 10-K and our subsequent Quarterly Reports on Form 10-Q, Product Stewardship, Climate Change and Water, Plastic and Energy Use are among our top sustainability risks.
(1)This report reserves the term “materiality” only to address issues that are deemed material from the point of view of the U.S. Securities and Exchange Commission (SEC). Topics that are important from a sustainability point of view in relation to our business, as defined in the GRI Guidelines and other reporting frameworks, are listed under the Key Sustainability Issues section. As a publicly traded company, Colgate files required reports with the U.S. Securities and Exchange Commission (SEC). Our 2019 Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q highlight risks material to an investment in the Company’s securities, including, but not limited to, those relating to sustainability, namely: volatility in commodity prices; changes in regulatory requirements relating to ingredients in our products; changes in policies or practices of retail trade partners, such as with respect to the environment or sustainability; damage to our reputation relating to environmental impacts or other sustainability issues; disruption to our global supply chain or key office facilities by environmental events; disruptions in logistics; damage from industrial accidents or other occupational health and safety issues; losses caused by natural disasters, including climate events; the impact of epidemics, pandemics and other widespread health concerns, including COVID-19; and the adverse impact of climate change. Refer to “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2019 and Part II, Item 1A of subsequent Quarterly Reports on Form 10-Q for the material risks relating to an investment in our securities.
Colgate strives to create and maintain transparent communication with a wide variety of stakeholders. Our sustainability commitments and goals are developed with the input from our stakeholders, and we continue to engage with them to inform our sustainability strategy. As part of our new Sustainability Impact Assessment, we have expanded the reach and methods used to engage with stakeholders, improved our feedback mechanisms through an employee sustainability survey, introduced new internal engagement tools, such as MindSpark and LinkedIn-Elevate, and encouraged direct feedback from our employees. Additionally, we have established a cross-functional team to continuously monitor our external stakeholders in different areas and discuss how we can best engage with them on an ongoing basis.
Colgate’s main stakeholder groups and examples of our engagement approach with respect to sustainability are outlined below. Read more on Colgate’s partnerships and details on our engagement.
METHOD OF ENGAGEMENT
Frequent internal communication, employee engagement surveys, digital engagement tools (MindSpark & LinkedIn-Elevate), geographic sustainability teams, internal subject matter experts, quarterly sustainability steering team reviews.
Integrated marketing communications including those addressing “brand purpose,” ongoing consumer dialogue, consumer surveys, social media postings.
Our retail customers and partners
Ongoing sustainability network groups, sustainability surveys, trade partner supplier expectations.
Our peers and suppliers
Peer benchmarking annually through theConsumer Goods Forum (CGF) membership, supplier engagement meetings, assessments and disclosure requests.
Our shareholders and investor groups
Direct inquiries and feedback on an ongoing basis, face-to-face meetings, investor conferences.
Government and regulatory bodies
Ongoing monitoring of regulatory activity relevant to Colgate, face-to-face meetings.
Quarterly direct inquiries and feedback, face-to-face meetings, participation in boards, advisory councils and partnership programs, reporting and disclosure expectations.
Industry trade associations
Ongoing participation in sustainability steering and working groups.
Local communities and community groups
Direct inquiries and feedback, face-to-face meetings annually.
Direct inquiries and feedback.
We recognize that transparency is important and provides a window into the Company’s performance on sustainability. Colgate provides the sustainability information relevant to a broad range of stakeholders, including consumers, customers, investors, non-governmental organizations (NGOs), and our own employees.
Colgate acknowledges the importance of data verification and is obtaining third-party assurance for our primary environmental and social Key Performance Indicators: percentage of products with an improved sustainability profile; number of zero-waste certified sites; manufacturing carbon reduction per ton (of production); manufacturing energy reduction per ton (of production); manufacturing water consumption per ton (of production); waste-to-landfill per ton (of production); outbound logistics carbon per ton (of goods shipped); number of hours worked; number of lost-time incidents; number of recordable incidents and number of occupational fatalities.
In this report and other channels, Colgate discloses information on our sustainability progress and responds to several rating organizations, including CDP Climate, CDP Water, CDP Forest and CDP Supply Chain, RobecoSAM (to inform the Dow Jones Sustainability Index rankings), JUST Capital, MSCI and Sustainalytics. Colgate’s sustainability information and the KPI table annexed also informs various ESG data sources including the Bloomberg Terminal.
Unless otherwise indicated, this report includes environmental, health and safety data from 100 percent of Colgate’s manufacturing sites and technology centers around the world, but does not include data from contract manufacturers.(1) Certain information relates to our broader value chain. Supplier Responsible Sourcing Assessment program data includes selected contract manufacturers, warehouses and suppliers; our greenhouse gas and water footprints include additional data from upstream and downstream in our value chain and progress on our Policy on No Deforestation includes selected suppliers. Financial information is presented on a consolidated basis and in U.S. dollars (see Business Strength). The report provides data for Colgate’s fiscal year 2019 along with historical information and more recent updates where indicated. We issue our Sustainability Report on an annual basis; our previous report focused on fiscal year 2018.
This report has been prepared in accordance with the GRI Standards: Core option. The alignment of this year’s report to the new framework can be found in our GRI Content Index. There are no significant changes in the scope of our report or the key sustainability issues identified. Please see our 2019 GRI Content Index for more details.
For inquiries, please visit Colgate’s Consumer Affairs site at www.colgatepalmolive.com.
Cautionary Statement on Forward-Looking Statements
This report, including our 2015 to 2020 Sustainability Strategy, contains forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995 or by the Securities and Exchange Commission (SEC) in its rules, regulations and releases. These statements are made on the basis of Colgate’s views and assumptions as of this time, and Colgate undertakes no obligation to update these statements except as required by law. Colgate cautions investors that such forward-looking statements are not guarantees of future performance and that actual events or results may differ materially from these statements due to a number of factors. For information about factors that could impact Colgate’s business and cause actual results to differ materially from these forward-looking statements, please refer to our filings with the SEC, including the information set forth under the caption “Risk Factors” in Colgate’s Annual Report on Form 10-K for the year ended December 31, 2019 and subsequent Quarterly Reports on Form 10-Q.
(1) Although Colgate does not include the local operating results of CP Venezuela and CP Pakistan in its Consolidated Financial Statements, data from these locations are included in the calculations in this report.
(2) Recent acquisitions of our skin health and oral care businesses, PCA Skin, eltaMD, Filorga and hello are not included in calculations referenced throughout this report, but they are consolidated for financial reporting.