Decarbonising
the chemicalindustry,
empowering
teams

Activity
Report2022

Message from the President

About TfS

2

Driving
Decarbonisation
through theChemical Industry
and beyond –the PCF Guideline

Empowering
People and Teams –TfS Capability
Building
and Training

5

7

At a glance

1
Assessments,
Audits and Action
Priority Dashboard

3
CAPs and Data Mining

10
Learning
Community

TfS Activity Report 2022

12

Regional
OperatingCommittees

16

KPIs

TfS Organisation

19

21

14
Learn more

25

Message of the President
Bertrand Conquéret

Dear TfS members, suppliers, and friends,
The past year has been an extraordinary one
for TfS, with significant challenges and great
achievements.
TfS has made considerable progress in theimplementation of its Grow&Deliver strategy
2025, particularly in addressing the contributionof the chemical industry and its supply chainsto the huge challenge of climate change andin enhancing the collective knowledge onsustainable supply chain topics.
The TfS members created the first-of-its-kind
Product Carbon Footprint Guideline for thechemical industry, enabling companies andtheir suppliers to develop and share harmonised,
standardised, and comparable high-quality carbon footprint data. Combined with the IT sharing
solution which will be launched in 2023, thePCF Guideline will be an essential instrument todecarbonise the chemical and related industries.
TfS rolled out the TfS Academy, a one-stopupskilling hub with more than 300 exclusive
and tailored capability-building contents inten different languages.
TfS Activity Report 2022

Message of the President

The Academy is the major tool for procurement
teams and suppliers to deepen their knowledge
and take on an individual and collective
responsible sourcing upskilling journey.
TfS strengthened its position as the de facto
global standard for sustainable supply chainsin the chemical industry. We were very proud
to welcome seven new members: allnex, CABBGroup, IMCD Group, Lenzing, Lonza Group,
Mitsui & Co., and Sennics, bringing the total
membership to 40. With the arrival of our firstJapanese member, Mitsui & Co., and second
Chinese member, Sennics, along with the otherfive new European members, TfS has increased
its reach and impact on the sustainability
performance of chemical supply chains.
The network of TfS Regional Operating
Committees continued to facilitate and increase
positive impact on the sustainability performanceof suppliers in Asia (China, India, Japan, andSingapore), North America (US), and SouthAmerica (Brazil). These committees continued
their outreach activities in partnership with
regional chemical associations

by organising joint events and with thisfurther raising awareness of TfS and its
programme elements.
On behalf of the Steering Committee, I thankthe entire TfS team and ecosystem, all the TfS
CPOs, TfS Coordinators, global and regional
Work Stream members, buyer communities,
suppliers, stakeholders, and key partners
for their dedication and commitment to the
TfS initiative.
Another extraordinary year lies ahead of us.
Yet, another year that brings us closer tothe target year 2030 of the United Nations
Sustainable Development Goals and the
1.5 degrees Celsius global warming limitation
target of the Paris Agreement. Thus, the callfor sustainable businesses only intensifies.
TfS is the crucial enabler to make supply chainsand businesses at large more sustainable.
Let us continue the journey of working together
to develop and implement sustainable
responsible sourcing solutions for a better world.

The past year
has been an
extraordinary
one for TfS,
with...great
achievements1About TfS€ 600 billion€ 400 billion(As per TfS member companies published Annual Reports 2021)(Estimated figures)

global turnover of TfS member companies
in the chemical industry

A global organisation, with
headquarters in Brussels,
EuropeGlobal spend of TfS member companies
in the chemical industry

Our 40 Members

Regional representation by
TfS members in Asia (China,
India, Japan, and Singapore),
Brazil, and USA

Created in

2011

Develops and drives
innovative responsible
sourcing solutions throughthe global chemical industry

TfS Activity Report 2022

About TfS

2

At a glance
Driving Decarbonisation throughthe Chemical Industry and Beyond:the PCF Guideline
Launch of the PCF Guideline to calculate and share highquality carbon footprint data for companies and suppliers.

Empowering People and Teams –TfS Capability Building and Training

Assessments, Audits andAction Priority Dashboard

Launch of the TfS Academy
as a one-stop upskilling
hub for responsible sourcing.

Launch of the
Action Priority
Dashboard for
TfS Assessments
to increase due
diligence basedon the urgencyof emerging topics.

Over

More than

1,300 10335

learners
registeredcoursesavailable

different
languages

1,134 984 45.18
courses
completed

The global launch
event of the Guideline
on 9 November wasattended by835

stakeholders fromaround the world.

TfS Activity Report 2022

At a glancecourses inprogressdays
learning

TfS supplier training webinars in cooperation with
EcoVadis drive continuous improvement. More than
1,900 participants in total attended the nine webinars
in four languages.
Launch of several Communities of Practice, including
5 Round Table events for TfS Coordinators, helping todeliver tangible impact by learning from, and supporting,one another.

Remote Audits permanently embeddedin the TfS Audit programme.

Focus on TfS Audits
used by TfS memberswith up to 25% of
non-TfS Audits(SMETA, SQAS andPSCI Audits) accepted
per TfS member company.

TfS Oasis dashboard
provides visibility of critical topics from CAPs.

3

At a glance
CAPs andData Mining

Regional Operating
Committees

KPIs

Data mining of Assessments
indicates the average score
for all parameters increasedby 1-2 points compared to 2021.
Analysis of 309 Audits revealed
3,795 findings; 45 follow-up
Audits were carried out with
743 findings.

55%

had improved.

Learn MoreTfS provides a range of
information, communication,and upskilling resources.

www.tfs-initiative.com

TfS Activity Report 2022

Learning Community

TfS Assessments
TfS membership exceeded all targets.

KPI 1

KPI 2

KPI 3

13,471 TfS Assessments
actively managed by
TfS members

8,385 TfS Assessments
conducted and sharedacross TfS members

64% New Assessments
and re-Assessments

112%

140%

105%

of targetof targetof target

TfS Audit
Market uncertainties, together with availability constraints
made it harder for the TfS membership to reach targets.

KPI 1

KPI 2

799 TfS Audits
actively managed
by TfS members

379 TfS Audits
conducted and sharedacross TfS members

94%

84%

of targetof target

Regional Operating Committees
in China, Japan, Singapore, USA,and Brazil support the implementationof the TfS programme in the regions.

TfS provides the platform 4 CPO discussions, 3 #TfSTalks,
1 #TfSConnect and the Annual
Workshop - where TfS leadershipand professionals exchange
information and best practice.

TfS Organisation
With 7 companies(1 Chinese, 1 Japaneseand 5 European) joining
the initiative in 2022,
the total membershipis now.

40

A member-driven initiative, representativesof TfS member companies who are part of the
TfS global and regional work streams drive theinitiative forward.
Governance - commitment to CO2 reduction
in value chains anchored in the TfS Articles of
Association and membership criteria.

4Driving Decarbonisation throughthe Chemical Industry and beyond
The PCF Guideline

Introduction

02
6

About the Guidance

8

2.1 Background and context ....................................... 9
2.2 Governance process for periodic reviewof the present guideline ........................................ 905
Specifications for
Suppliers’ Product
Carbon Footprint
Calculation

14

2.3 Problem statement ................................................. 9

4.1 Definition of Scope 3.1 Purchased
Goods and Services .............................................. 15

2.4 Objective of the guideline ..................................... 9

4.2 Foundations of the 3.1 accounting process .... 15
4.3 Activity data ............................................................ 17
4.3.1 Activity data collection and processing ........................... 17
4.3.2 Clustering and Prioritization of Activity Data .................... 19

2.5 Importance of content considered .................. 10

4.4 Emissions factors ................................................ 22

2.6 Methodology and reference to existing
standards and guiding documents .................. 11

4.5 Target baseline recalculation ........................... 28

2.7 Terminology: shall, should, and may ............... 11

4.6 Additional Accounting andReporting Guidance ........................................... 28

Glossary88

5.3 Verification and Reporting ................................ 84
5.3.1 Verification of PCF calculations / Quality assurance ....... 84
5.3.2 Information to be reported with PCF .............................. 85

References

94

Appendix97

References

03

5.2 Calculation rules ................................................... 41
5.2.1 Steps of PCF calculation ................................................ 41
5.2.2 Temporal Scope ............................................................ 41
5.2.3 Criteria to exclude certain activities (Cut-off) ................... 42
5.2.4 Standards used ............................................................. 42
5.2.5 Data types and sources ................................................ 43
5.2.6 Emission factor requirements and sources..................... 44
5.2.7 Life Cycle Impact Assessment (LCIA)............................. 45
5.2.8 Activity data requirements.............................................. 47
5.2.9 Multi-output processes ................................................. 63
5.2.10 Additional rules and requirements.................................. 70
5.2.11 Data quality and share of primary data ............................ 79

Glossary

4.6.1 Contract Manufacturing including tolling......................... 28
4.6.2 Trading of materials/Merchandise ................................. 30
4.6.3 Swaps .......................................................................... 30
4.6.4 Joint ventures/Joint arrangements ................................. 32
4.6.5 Recycling/ recycled content (what to report where:
category 3.1 vs. category 3.12)........................................ 32
4.6.6 Biogenic emissions and removals ................................. 33
4.6.7 Mass-balance chain-of-custody ................................... 34
4.6.8 Offsets, Carbon Capture and Storage (CCS)& Carbon Capture and Utilization (CCU) specifics........... 34

36

5.1 Goal and Scope .................................................... 38
5.1.1 General ........................................................................ 38
5.1.2 System boundaries ....................................................... 39
5.1.3 Declared unit (DU) of PCF.............................................. 40

Specifications

2.4.1 Design of a consistent process for Scope 3.1
data collection ............................................................... 9
2.4.2 Embedding supplier PCF data in downstream
PCF calculations calculation .......................................... 10

Reporting Principles

04
Guidance on
Scope 3.1 Calculation
on Corporate Level

Guidance on Scope 3.1

12

4

5

The TfS PCF Guideline provides a practical solution
to the challenge of Scope 3 GHG emission measurement

5

Appendix

Driving Decarbonisation through the Chemical Industry and beyond

01

Reporting Principles

TfS Activity Report 2022

About the GuidanceWith this backdrop, 2022 was a year ofsignificant acceleration for the TfS Scope 3
GHG Emission Programme. Teams of experts
from within and beyond the TfS membershipcollaborated extensively to develop the firstbuilding block of TfS’s tailor-made, drop-in
solution to address the Scope 3 challenge
within the chemical industry.

From vision into action
Building on the vision developed in 2021,
TfS accelerated activities, with member
companies dedicating their top experts
to contribute. A particular focus was madeon the Scope 3 Category – purchased goods& services (also referred to as Scope 3.1).
Today, it is common practice for companies
to estimate GHG emissions for Scope 3.1
based on emission factors from databases orgeneric information. In the future, companies
will need to utilise primary data to monitor
actual GHG emission reductions – also
known as Product Carbon Footprints (PCFs).
Until recently, no harmonised approach
existed amongst chemical companies on how
to calculate PCFs. Many other industries arefacing the same challenges and are developing
specific solutions.

Introduction

TfS’s focus on Scope 3 greenhouse gas(GHG) emissions was fortified in 2022,
recognising that urgent action is needed bychemical companies to meet the goals of theParis Climate Agreement and limit the worst
effects of climate change. Currently, 77% of
the chemical industry’s GHG emissions areproduced within the value chain. These are
known as Scope 3 GHG emissions. To tackle
these indirect sources of GHG emissions,
corporations need tools to quantify themmore accurately and in a way that increases
the transparency of their supply chains.
Moreover, this information needs to flow
between value chain partners to improvecarbon transparency and foster engagement
for GHG emission reduction.

Milestones achieved in 2022

Anna Stanley (WBCSD),
Prof Dr Peter Saling (BASF),
Dr Verena Buback (Merck)and Kentaro Mizuike(Mitsubishi Chemical
Corporation) at the official
launch of the PCF Guideline

The TfS Scope 3 GHG Programme achieved several key
milestones in accordance with its plan for 2022, paving
the way for a successful 2023 programme of activities.

PCF Guideline
TfS published a first of its kind guideline for the chemicalindustry. The PCF Guideline provides detailed guidanceon how chemical companies should calculate the PCF of
products, and how to integrate PCFs into corporate scope
3.1 accounting inventories to better capture reduction efforts
taking place on site. Both TfS members and suppliers will
benefit from the PCF Guideline, enabling them to calculate
PCFs in a standardised way while acknowledging theparticularities of the chemical industry. The guideline closes
the gap on existing standards and builds specificity for thechemical industry. It was piloted and reviewed by more than
50 chemical value chain suppliers and is compliant withexisting standards such as the ISO and GHGP.

Official launch of the PCF Guideline
The World Business Council for Sustainable
Development (WBCSD) and TfS hosted
a virtual panel session on 9 November.
Attended by a global audience of 835,
cross-sector sustainability leaders andchemical companies shared their experience
with the PCF Guideline. Discussion topics
included what the Guideline is, how suppliersand corporations can use it, how to roll it out
in organisations, and why it matters.

Speakers included Anna Stanley of the
WBCSD, host and moderator of the event;
Bertrand Conquéret, President of TfS;
Prof Dr Peter Saling of BASF, Dr Verena Bubackof Merck; and Kentaro Mizuike of Mitsubishi
Chemical Corporation.
Watch the full recording of the event at:https://youtu.be/niO1k0i9NLA

To raise awareness and increase adoption of the PCF
Guideline by associated industries, the Scope 3 GHG
Programme began external engagement with related
associations and initiatives.
In 2023, the TfS Scope 3 GHG Programme will publish a
White Paper on open topics and use the feedback received
as part of the PCF Guideline governance process.

Invitation to the Official launchof the PCF Guideline

TfS Activity Report 2022

Driving Decarbonisation through the Chemical Industry and beyond

6

Empowering People and Teams:
TfS Capability Building and Training
In 2022, TfS took significant steps in driving forward its Grow&Deliver strategy 2025. With the strategy, TfS strives to close
the gaps of supplier evaluation and re-evaluation by offering knowledge and upskilling opportunities for free for its two main
target groups: purchasers in TfS member companies and suppliers to TfS members. In 2022, TfS launched its TfS Academy
and, so, opened up the opportunity to “Unlock Your SustainAbilities” for all members of the TfS community.

Launch of the TfS Academy
Building a better world is everyone's responsibility.
When it comes to making global chemical supply chains
more sustainable, both TfS member companies and their
suppliers play an essential part. That is why, in spring 2022,
TfS launched the TfS Academy: a tailored learning anddevelopment platform designed to help upskill TfS member
companies' procurement teams and their suppliers onsustainability. The TfS Academy is free to use for all TfS
member company staff and their suppliers.
The TfS Academy – with its more than 335 courses inten different languages – touches on everything fromkey concepts to the latest sustainable procurement trends.
TfS member companies and their supply chain partners
bring together a wealth of existing knowledge and expertise.
The TfS Academy builds on this and complements
learners' existing skillsets with a range of courses thatvary in length and depth, allowing them to learn at theirown pace and meet their knowledge needs.

TfS Activity Report 2022

In 2022, overIn 2022, over 1,300 learners have registered profiles
on the TfS Academy. Collectively, they spent 45.18 days
learning. 1,334 courses were completed and 984
courses were in progress. Popular topics include TfS
Scope 3 and decarbonisation efforts such as "Managing
Energy and Greenhouse Gas Emissions", "Get ready todecarbonise", and introductions to the circular economy.
Importantly, TfS connected the learning offer to the
TfS OASIS database, its audit sharing solution. Suppliers
who have completed an Audit and have corrective actions
to carry out are automatically referred to courses that canaddress their knowledge gaps and help them implement
their corrective actions. To help learners navigate theextensive course offer, learner and theme-specific learningplans are available. These are set up for a variety ofaudiences from C-suite to operational buyers. They also
cover a variety of topics, including the circular economy
and human rights.

Empowering People and Teams: TfS Capability Building and Training

1,300
learners haveregistered profiles
on the TfS Academy
Collectively, they
have completed

1,334
coursesand spent

45.18
days learning

7

What I like the most about the
TfS Academy is the enormous
range of courses on different
aspects of sustainability or how
TfS works. I love these courses
as they seem to be created by
TfS members that could havebeen at the same point of thejourney where we are now.
I also enjoy the option to beable to search content in theplatform by keywords per mytraining needs, and then filterby language, duration, etc.
As a buyer, I also appreciate
the fact that you don't havean additional fee to benefit
from this.

I took the first steps in the
TfS Academy and was very
impressed by the broadoffer on various topics
concerning sustainability inbuyer-supplier relationships.
We quickly found training
offers that provided answers
to questions we face day-to-day.
I would recommend visiting
the TfS Academy.

Annette Wolff
Head of Indirect Materials Western Europe
HenkelPaula Martin
Responsible Procurement Leader
Chemours

TfS Activity Report 2022

Empowering People and Teams: TfS Capability Building and Training

8

TfS Capability Building and Training

Launch of dedicated
TfS Academy Newsletter

Driving continuous
improvement via co-hosted
Webinar Series with EcoVadis

During 2022, TfS and EcoVadis
co-hosted two waves of webinars
to equip TfS suppliers with theknowledge to utilise the EcoVadis
platform and to prepare themfor Assessment.

To inform learners about thecontinuously growing offers on
the TfS Academy and upcoming
webinars and talks, TfS launched
a dedicated monthly TfS Academy
newsletter. Over 1,000 global
subscribers are now signed up.

TfS Activity Report 2022

The webinars also focused onfollowing up on corrective actions
and included hands-on casestudies to showcase how to
implement sustainability policies
and actions. The nine webinars(in four languages) were attended
by more than 1,900 participants.
All training sessions were recorded
and are available on-demand fromthe TfS Academy.

Empowering People and Teams: TfS Capability Building and Training

New TfS Communities ofPractice launched: pivoting
to delivering tangible Impact
by learning from andsupporting one anotherIn line with the TfS Grow and
Deliver strategy to pivot froma collaboration focused on
measurement to a communitythat delivers tangible impact overthe next five years, TfS launchedseveral Communities of Practice.
These seek to enable TfS
members to learn from eachother, address common issues,
and utilise good practice examples
and shared approaches to tackle
decisive issues.

TfS Coordinators'
Roundtable

TfS Capability Building
Community of Practice

The TfS Coordinators'
Roundtable is where employees
across TfS member companies
share ideas and challenges
specific to their role as a TfS
Coordinator. This Coordinatordriven initiative creates value andexpands access to resources by:This community brings
together capability building
and supplier development
specialists in TfS member
companies to share insights
and practices on sustainability
learning and development
strategies. Participants learn
from each other and sharechallenges and questions.
They also collaborate in areas
where they can best utilise
synergies under the TfS umbrella.

• Sharing TfS related work
practices, experiences,and best practice• Supporting each other withsolutions and ideas in
Coordinators’ daily challenges• Assisting with Coordinators’
onboarding
The TfS Coordinators’ Roundtable
offers the opportunity to all TfS
Coordinators to address topics
of interest and requests, connect
the right people for specific topics
on experience exchange sessions,and benchmark.

9Assessments, Audits and Action Priorities Dashboard
The TfS global supplier engagement programme assesses and improves sustainability
practices within chemical supply chains. TfS Assessments and Audits measure the Environmental,
Labour & Human Rights, Ethical and Sustainable Procurement performance of suppliers.

TfS Assessments are completed by EcoVadis our key partner and a global leader for CSR
Assessments, while Audits are conductedby selected TfS-approved Auditors. Results
are shared with all TfS members under the
principle “an Assessment or Audit for one is
an Assessment and Audit for all”, enhancing
efficiency and cost-effectiveness while
simultaneously encouraging industry-wide
collaboration and continuous improvement.

TfS Assessments: Action Priorities Dashboard
In the summer of 2022, TfS launched the TfS Action
Priorities Dashboard together with EcoVadis. Using
Tableau software, the dashboard enables TfS member
companies to better detect emerging risks in their supplierpool. It also enables TfS to detect common problems.
The dashboard is the result of the data mining project
jointly managed by the TfS Work Stream Assessments and
EcoVadis. The aim is to increase due diligence based on
the urgency of emerging topics such as child labour, forced
labour, human trafficking, corruption, as well as scope 1 and
2 energy consumption and GHG emissions from suppliers.

These topics can be analysed on a macro level andbrought to the attention of all members, as well as at
individual supplier level.
Topics use data from a list of areas for improvement
to define either low, medium, or high priority.
The topics are reviewed regularly in the Work Stream andcan be adjusted if necessary. At a later stage, comparisonof Assessment and Audit risk priorities will be conducted
to better understand trends in risk areas.

Action priorities for partners
Child labour, forced labour& human trafficking

Energy consumption& GHG emissions

Corruption

10.8%

3.8%
26.3%

Reporting on KPI

22.1%

23.9%

16%

69.9%

73.2%

14.9%

23.3%

63.0%

Low
TfS Activity Report 2022

Assessments, Audits and Action Priorities Dashboard

Medium

52.8%

High

10

TfS Audits
RemoteAudits

Acceptance of similar
Audit programmes

Audit-sharing
and improvement

With Covid-19 restrictions stillin place in some regions, remote
Audits are now considered avalid alternative to on-site Audits.
A benchmark study and interviews
with other sustainability Audit
programmes concluded that thedifferences in outcome between
the two types of Audits are notsignificant. With many companies
increasingly allowing remote work,
remote Audits are becoming acertainty. Nevertheless, we follow
the guidelines of the Audit firms
in cases where remote Audits are
not applicable. To remain diligent,
when the supplier participates inan online Audit, we require that thenext Audit be on-site.

Several of our members relyon Audit programmes such as
SMETA, SQAS and PSCI to
improve sustainability in their
supply chains. TfS considers andaccepts these valid alternatives
to avoid duplication of efforts bysuppliers. TfS continues to focus
on the TfS Audit programme andthe quota of the member company
can include up to 25% of SMETA,SQAS and PSCI Audits. In 2022
TfS accepted 18 SMETA and 19
SQAS Audits. TfS did not receive
any PSCI Audits.

The TfS Audit database - OASIS (Online Audit Sharing
IT Solution), launched in 2021, enables Auditors,
members, and suppliers to join activities to improvelabour, governance, health & safety, and environmental
conditions in supply chains:•	An increasing number of suppliers are providing
feedback on the corrective actions identified during
the Audits.
•	Members can filter all corrective actions by supplier,gravity, date, or country and track them in real time.
•	A comprehensive dashboard allows members to
track their Audits and corrective actions to meettheir annual targets.

TfS is constantly improving this system to increase
visibility and ease of use. In 2023 we will set up a datafiltering dashboard to identify action priorities analogue
to Assessments. The system will also better support
suppliers pre- and post- Audit by integrating the TfS
Academy for preparation and CAP resolution as well
as sending reminders when new Audits are due.

TfS Activity Report 2022

Assessments, Audits and Action Priorities Dashboard

11

CAPs and Data Mining
Both TfS Assessments and TfS Audits result in Corrective Action Plans (CAPs) - a set of actions that allow member
companies to take action to make tangible improvements in their own supply chains. Data mining from TfS Assessments
and TfS Audits allows TfS to focus on those areas where the greatest improvements can be made. Analysis of Assessment
and Audit data provides direction for capability building in target countries and suppliers.

TfS Assessments
Tableau software used to qualitatively andquantitatively analyse the data/scorecards
TfS uses Tableau business intelligence and analytics
software to perform both qualitative and quantitative analysis
of Assessment data/scorecards. Tableau enables us to
identify key strengths and weaknesses of all scorecards andidentify the parameters associated with the lowest scores.
Analysis of average scores per parameter indicates thatin 2022 all parameters increased by 1-2 points compared
to 2021. Labour & Human Rights scored the highest andSustainable Procurement the lowest.
Benchmarking the results of TfS suppliers and supply
chains against non-TfS average scores demonstrates that
TfS suppliers consistently rank above the overall EcoVadis
population of rated suppliers.
TfS Supplier re-Assessments in 2022 showed an
improvement score of 64%. Across all those re-assessed
suppliers, the improvement is 3.7 points in the overall
score, whereby the improvement in the section SUP(supplier procurement score) is the biggest with 4.1 points.
This is also the area where most improvement is required.

All

Environment

Labour/Human
Rights

EthicsSustainable
Procurement

53.3

48.5

42.4

Sustainability performance of TfS Suppliers

7,818

50.8

52.2

Suppliers

Benchmarking TfS suppliers vs all Assessments in the last three years
13,471 vs 107,416

+ 3.5

+ 4.5

+ 3.6

+ 2.8

+ 2.7

Companies

48.3 vs 44.8

49.2 vs 44.8

51.2 vs 47.6

45.7 vs 42.9

39.7 vs 37.0

+4.0

+3.3

+3.8

+4.1

Reassessments of TfS Suppliers

64%

+3.7

Improvement score
Figure: Tableau average scores per section

TfS Activity Report 2022

CAPs and Data Mining

12

TfS Audit
Findings
Follow-up Audits

TfS Audits cover 5 categories:
Management, Environment, Health & Safety,
Labour & Human Rights, and Governance.
These are analysed through 150 standardised
questions in each supplier Audit.
For 2022, TfS analysed 309 Audits, which
revealed 3,795 findings, most of these related
to Health & Safety. As this topic also had
the most critical issues, and Emergency
handling and preparedness remains a concern,
the TfS Academy offers suppliers courses
on the subjects.
The most common Environmental issues
relate to the monitoring of GHG emissions.
In terms of Human Rights, data analysis
showed that most findings are related toworking hours and wages.

Follow-up Audit findings

Follow-up Audits743

In 2022, 45 follow-up Audits were carriedout with approximately 743 findings. 55%
had improved. Over 100 suppliers indicatedimprovement after the Audit by updating their
CAPs online. This translates into around 800
minor, major, and critical findings displaying
progress.

500
45

Thanks to efforts of our members, the numberof follow-up Audits and follow-up Audit findings
has increased by 50% year-on-year.

30

In the Management section, monitoringand documenting supplier and contractor risks
and human rights violations remains a problem,
but the severity of these problems is declining.
2021

TfS Activity Report 2022

CAPs and Data Mining

2022

2021

2022

13

KPIs
Assessment KPIs
As of 31 December 2022

Target achieved by 140%

TfS KPIs for Assessments and Audits create transparency
and positive impact. The sharing of Assessment andAudit results enables a dialogue on improvement between
member company/customer and supplier. Many suppliers
demonstrated sustainable improvements after an evaluation
through the TfS programme.
In line with their sustainability strategy and ambition, each
TfS member company defines its own annual target tocontribute to the TfS KPIs. The aggregation of each of thesetargets forms the global KPIs that the TfS community iscollectively working towards, reflecting the idea that, whilsteach TfS Member has its own individual strategy, throughcollaboration these contributions are amplified.
Self-defined targets also strengthen the responsibility andownership of member companies for their TfS Assessments
and TfS Audits and follow-up.

Target achieved by 112%
Target achieved by 103%

KPI 1

KPI 2

KPI 3

TfS Assessments
actively managed
by TfS members

TfS Assessments
conducted & sharedacross TfS members

New Assessments& re-Assessments

Target: 12,000Actual: 13,471

Target: 6,000
Actual: 8,385

Target: 62%
Actual: 64%

TfS members exceeded all TfS Assessment KPI targets. The strong results show
the robustness of the TfS Assessment approach with its online tools. They are also
a testament to the resilience of the TfS members’ supply chains and their ability to
improve sustainability performance despite challenging times.

TfS Activity Report 2022

KPIs

14

Audit KPIs

Regional Perspective

As of 31 December 2022

Target achieved by 94%

KPI 2

TfS Audits
actively managed
by TfS members

TfS Audits
conducted & sharedacross TfS members

Target: 850
Actual: 799

Target: 450
Actual: 379

With a target of 450 Audits, the ambition was high, given the uncertain
global situation due to supply chain issues in Asia, the war in Ukraine
and associated high energy prices. While site access has been less of
an issue this year than during the pandemic, scheduling and availability
constraints, along with market uncertainties, meant fewer Audits werecompleted than expected.
The OASIS database enabled a shift of resources to supplierimprovement. Suppliers are increasingly directly involved in the
online process and can be approached by multiple members to
discuss progress. TfS members can follow the live progress of thesekey findings. Throughout 2023, TfS aims to better prepare suppliers
for an Audit so that more time can be spent resolving corrective
actions rather than in preparation.

KPIs

TfS Audits

per region 2022

per region 2022

Asia pacific ..............................................27%

Asia pacific ..............................................63%

Europe ......................................................48%

Europe ...................................................... 10%

Target achieved by 84%

KPI 1

TfS Activity Report 2022

TfS Assessments

N America ............................................... 14%

N America ................................................. 3%

S America .................................................. 9%

S America .................................................. 7%

Other ............................................................ 2%

Other .......................................................... 17%

TfS Assessments

TfS Audits

top 3 countries

top 3 countries

Germany

.15%

China

52%

China

1
. 4%

India

16%

USA

13%

Germany

7%

15

Learning Community

To succeed in its core
mission of improving thesustainability performanceof chemical suppliers
around the world, TfS
fosters a connected
and learning community.

Several TfS initiatives enhancethe exchange of information andbest practices between all TfS
members - in full compliancewith antitrust laws.
TfS provides market leaders witha global platform where they canshape the future of the chemicalindustry. TfS operates as a peerto-peer network and enables the
CPOs of the 40 member companies to exchange ideas, share bestpractices in sustainability activities, learn from and be inspired bytheir peers.

The online discussions #TfSTalks
facilitate the sharing of informationand the exchange of ideas andbest practices.

The newsletter, #TfSConnect,
keeps the wider TfS community
informed about new initiatives andprogress on the four pillars of the
TfS Grow&Deliver strategy 2025.
The TfS Annual Workshop enables
the internal TfS community tomeet, learn about the latest
developments in the TfS initiative,
discuss and actively contribute to
key topics.

#TfSConnect keeps the wider
TfS community informed about
new initiatives and progress

TfS Activity Report 2022

Learning Community

16

CPO Discussions#TfSTalks

CPO discussions are organised four times
a year, around the TfS Steering Committee
meetings and at the General Assembly.

#TfSTalks are online discussions and knowledge-sharing opportunities prepared by,
and for, TfS members on sustainability topics of joint interest to the TfS community.
In 2022, TfS organised three #TfSTalks reaching a total audience of 529; the average
audience per session was 176, up from 143 in 2021 - an increase of 23%.

In 2022 topics covered by TfS CPOs
included supplier coverage, challenges
and adjustments needed given the recent
and upcoming supply chains laws, approachto sustainability, sustainability procurementtargets, applying TfS processes for future
Supply Chain Due Diligence and upcoming EU
CSDD, and supplier decarbonisation journey.

The three #TfSTalks of 2022 featured the following topics and speakers:

TfS CPOs Joachim Christ, Merck;
Klaus Blachnich, OMV; Erk Thorsten Heyen,
Wacker; and Thomas Roemer, Covestro led
the discussions.

1.
“Exploring the Sustainability
Case for Supplier Diversity”(Sara Nickovich, Director Supplier Inclusion& Diversity and Sustainability Bayer; Gen Lund,
Head of Controlling & Governance, Procurement
BASF; Marisa Jakubovic, Sourcing Manager
for HR Services, Supplier Diversity Covestro;and Michelle Morin, Global Procurement
Leader Supplier Diversity & Sustainability
Corteva Agriscience)

2.
“How to Integrate the TfS
Academy into Your Company’s
Learning Environment”(Astrid Bosten, Global Senior Communication
Manager Purchasing and Global Supply Chain
Henkel; Rebecca Weight, Capability Building
and Trainings Project Manager TfS; Maren
Hübschmann, Senior Manager Sustainability
Development Bayer; Doerte Lorenz, Program
Lead Global Sustainable Procurement LyondellBasell; and Yvonne Jamal, CEO JARO Institutefor Sustainability and Digitalisation)

3.
“International Sustainability
Supply Chain LegislationHow to conduct Due Diligenceand Meet Requirements”(Melina Gonçalves, Senior Sustainability
Consultant EcoVadis; Andreas Zamostny,Managing Partner Schlange, Zamostny &Co. Consultants for Corporate Responsibility;
Sascha Ceylan, Head of Sustainability,
risk & Compliance / Procurement Evonik;
Yun Zheng, Global Sustainability Manager,
IFF; and Lisa Schroeter, Global Directorof Trade & Investment Policy Dow)

Each of the #TfSTalks were followed by a lively Q&A session.

TfS Activity Report 2022

Learning Community

17

#TfSConnect

TfS Annual Workshop

The #TfSConnect newsletter keeps the broader internal TfS community
informed on new initiatives and progress made on the four pillars of the
TfS Grow&Deliver strategy.

TfS Annual Workshop 2022 (28-29 September), welcomed more than 250 online
participants, including TfS CPOs, Coordinators, Work Stream, and Regional teammembers, as well as Buyers from TfS member companies.

The community includes representatives from member
companies’ Buyer, CSR, Investor Relations, Public Affairs,
Human Resources, and CEO office departments.

#TfSConnect
subscribers
increased
from#TfSConnect was published in March 2022 with thenumber of subscribers increasing from 850 to 940.

850

To provide broader insights, #TfSConnect references
articles published on the TfS website or TfS SharePoint.
Contact details of all workstream members are included
with each article, facilitating further networking andexchange of information among the TfS community.

to940
in 2022

Opening the workshop, TfS
President Bertrand Conquéret
warmly welcomed the global
TfS community, summarising themost recent TfS achievements.
Capability building and training
as well as the TfS Scope 3 GHG
emissions programme were thefocal points of this year’s discussions. Every TfS Work Stream andRegional team had the opportunity
to provide insight on their projects.
New for 2022 were sessions
dedicated to new TfS members(joining since autumn 2021),
training for buyers, and a TfS
CPO led session.

Two days of engaging discussions
and new ideas gave participants
insight into the future scope andstructure of TfS; re-evaluate the
TfS Audit approach; discuss
opportunities to better engage
members locally and skills needed;brainstorm how to work with
suppliers on pathways to reducegreenhouse gas emissions; checkout the new risk dashboard, andmuch more.

More than250
participants
at TfS
AnnualWorkshop

Recordings are available on
the TfS Academy.

The TfS Annual Workshop
featured a packed scheduleof interactive sessions#TfSConnect
issue 3 waspublished in
March 2022

TfS Activity Report 2022

Learning Community

18

TfS Regional Operating Committees
Through its network of Regional Operating Committees consisting of representatives of member companies in the region, TfS ensures that the implementationof its programme is properly supported globally. Developing and fostering regional partnerships and close cooperation with regional chemical associations are
crucial for TfS to increase membership, work on supplier improvement programmes and advance specific topics of joint interest.

AP
TfS China
TfS China continued its successful partnership with
CPCIF by jointly organising industry and training events.
The TfS supplier training at the annual CPCIF event in Ningo
on 15 November not only focused on online Assessments
and onsite Audits, but also introduced the PCF Guideline.
Whilst Covid restrictions limited physical attendees to 70,
online streaming received 280,000 views/clicks.
The TfS AP President in duty, Robert Yang, delivered
keynote and other speeches at several events and thenumber of followers of the TfS WeChat account increased
to 3,702 (a +24% year-on-year increase).

Regional supplier trainings, in cooperation with EcoVadis,delivered significant results: 303 participants attended
the first training in Chinese in June, 101 participants thesecond Chinese training in October, and 450 participants
the English session in October.
In addition, two TfS Academy training events were heldin May in Chinese, targeting suppliers and TfS member
companies in China. Following the creation of the TfS
global work stream on scope 3 GHG emissions, TfS China
established a regional work stream with the same focus.
This will support global activities and act as a counterpart
to the CPCIF GHG experts during their regular exchanges.

TfS China organised supplier training at the
CPCIF event, Ningbo, 15 November 2022.

TfS Singapore
In 2022, member companies of the TfS
Singapore Regional Operating Committee Henkel, Arkema, Azelis, Evonik, Semperit,
Solvay and Syngenta - welcomed Dow as
its eighth member. The regional teamparticipated in the “Sustainability in Business,

TfS Activity Report 2022

Sustainability as Business” webinar hosted
by Enterprise Singapore, a government agency
working with companies to build capability,
innovate and internationalise. Attended
by many local SMEs, the Singapore teampromoted the TfS initiative as well as the new

TfS Regional Operating Committees

PCF calculation methodology, encouraging its
adoption. The team further raised awarenessof TfS in Southeast Asia by publishing anadvertorial in the South China Morning Postand Facebook (edition 28 November) focusing
on the general TfS framework.

19

TfS Regional Operating Committees
LATAM

NA

Latin America

North America

For more than 6 years, TfS LATAM has contributed
to improving the sustainability performance in regional
supply chains and engaging with suppliers to improvesustainable practices.

The NA Committee includes 23 companies, representing
57.5% of the TfS membership. In March 2022, NA launched
the first (un-staffed) Sustainability Hub as a partner to IHS
Markit at the World PetroChemical Conference (WPC)and Genius Exchange, in the USA, where 1,500+ leadersconverged to support ‘Navigating toward NetZero’’.

The LATAM Regional Committee consists of 12 TfS
members and, together, they achieved good results.
Currently, the South American region occupies the third
position in the global ranking of TfS Audits. This result
has been achieved thanks to the excellent collaborationof the LATAM team.
Since 2020, TfS LATAM focuses on the “About TfS”
training webinars, which has significantly increased
supplier participation.
TfS LATAM was looking for collaboration with chemical
associations and had the honour of being invited by Abiquim(Brazilian Chemical Association) to attend the Responsible
Care Conference in Brazil in 2018 and 2022. In November
2022, the regional team attended the Climate Change panel;
Alessandro Pistillo, Co-Chair of the Scope 3 GHG Emissions
work stream, shared the newly released PCF Guideline withover 350 participants.

TfS Activity Report 2022

TfS Regional Operating Committees

TfS branding, purpose, and member company logos weredisplayed within the Hub, video of the TfS Academy andother TfS marketing materials were streamed throughout.

TfS Sustainability Hub at theWorld Petrochemical Conference,
USA, March 2022

A TfS Fireside Chat was held, featuring in person speakers:
Jennifer Jewson, VP Global Procurement at LyondellBasell;and Mitch Toomey, Director of Sustainability of BASF
Corporation. Dr Gabriele Unger of TfS provided a prerecorded message (https://youtu.be/fUrCNiF2M5U).
The conversation was moderated by Rob Westervelt,
Editor-in-Chief of ChemWeek at IHS Markit.
Also in March, TfS NA hosted a #TfSTalks webinar,
entitled “Exploring the sustainability case for Supplier
Diversity”. Global supplier diversity leaders located in North
America and working for Bayer, BASF, Covestro
and Corteva Agriscience presented.

TfS Fireside chat at the WPC 2022 featuring Jennifer Jewson,
VP Global Procurement at LyondellBasell and Mitch Toomey,
Director of Sustainability of BASF Corporation

20

TfS Organisation
TfS is Global
Chemical supply chains are complex and global. Our membership and their suppliers
span the globe, with regional support from TfS.

Global operations are managed from the TfS
headquarters in Brussels, Belgium, with TfS
member groups in Asia Pacific, Latin America,
and North America.

Therefore, TfS has an inclusive approach andis open to any chemical company around theworld that shares the ambition to engage with
suppliers in sustainability improvements.

To increase its impact on sustainability
improvements, TfS needs to expand its reachand increase its impact around the world.

The TfS network of companies represents
all segments of the chemical industry. WhileTfS is committed to grow in all regions in theworld, China remains a priority, as well as othercountries in the Asia-Pacific region, especially
Singapore, India, and Japan.

New members
Seven companies joined TfS in 2022: one Austrian, one Dutch,
two German, one Swiss, a first Japanese and a second Chinese.
This brings the total number of members to 40.

New members in 2022:
allnex, a producer of coating resins
and additives, headquartered inFrankfurt, Germany
CABB Group, a contract development
and manufacturing company (CDMO)
for starting materials, active ingredients,
and advanced intermediates
IMCD Group, a Dutch formulator anddistributor of specialty chemicals
Lenzing, a global producer of dissolving
wood pulp and cellulosic fibers

TfS Activity Report 2022

TfS Organisation

Lonza Group, a Swiss-based
global manufacturing partner to thepharmaceutical, biotechnology andnutrition sectors
Mitsui & Co., a Japanese trading
company dealing globally in chemicals,
energy, metals and active ininfrastructure projects
Sennics, a service provider of polymer
additives, and member of Sinochem
International

21

Members Drive the Initiative
TfS Global Work Streams and Regional Operating Committees
A truly unique feature of TfS is that members drive the initiative forward, a crucial factor in its success.
Representatives of member companies ensure progress is made through active participation in five Work Streams.
These Work Streams also submit proposals to the TfS Steering Committee for ongoing projects.

TfS Global Work Streams

1

Governance andPartnerships

2

TfS
Assessments

3

4

TfS
AuditsDefinition of governancestructure of the initiative.

Improve and further develop
TfS Assessments.

Improve and further develop TfS
Audit programme and process.

 oordination of TfS externalCpartnerships.

Management of the relationshipwith service provider EcoVadis,
together with TfS office.

Management of the relationshipwith Audit companies, together
with TfS office.

1

2

1

3

2

3

1

2

TfS Capability
Building andCommunications

Supplier capability building,development of training forbuyers and suppliers, internaland external communications.

5

Scope 3
GHG Emissions

TfS approach to measure and reduce
GHG emissions including data collection
and sharing.
 ngaging suppliers to improve as well asEcooperating with external stakeholders.

3

1

2

Chair: Virginia Morton (Sika) 1

Chair: Sabine Zallinger (Wacker) 1

Chair: Christopher Easton (Syngenta) 1

Chair: Astrid Bosten (Henkel) 1

Co-chair: Morne Labuschagne

Co-chair: Judit Berger (Evonik) 2

Co-chair: Sascha Farooq (Evonik) 2

Co-chair: Nina Baumann (Merck) 2(Lanxess) 2
Co-chair: Sascha Ceylan (Evonik) 3

Co-chair: Athina Michalakopoulou

Co-chair: Sven Gelissen (Lanxess)

1

2

3

4

5

6

3

(UPM) 3Chair: Michael Heite (Bayer) < 04/22 1
Chair: Katherine Agapitos (Sika) > 05/22 2
Co-chair: Jens Plambeck (Bayer) 3
Co-chair: Peter Saling (BASF) 4
Co-chair: Verena Buback (Merck) 5
Co-chair: Alessandro Pestillo (BASF) > 07/22 6

TfS Activity Report 2022

TfS Organisation

22

TfS Office

TfS Regional Operating Committees
AP
1

LATAM
2

TfS Asia Pacific
Chair:
Robert Yang 1 (Arkema)
TfS AP President in Duty
Cross work stream
responsibilities

TfS Latin America
Chair:
Sheila Tazinazzo(Clariant)Cross work stream
responsibilities

TfS Singapore
Chair:
Thomas Holenia 2 (Henkel)
Cross work stream
responsibilities

TfS Activity Report 2022

NA

TfS Organisation

TfS North America
Chair:
Rachel Sheridan(Evonik)
Cross work stream
responsibilities

1

2

3

4

5

6

The members of the TfS office are involved in
the activities of the TfS Work Streams, prepare,and facilitate the meetings of TfS bodies, andare in contact with existing and potential TfS
members and cooperation partners. The TfS
General Manager assumes the day-to-day
leadership of the organisation.
Dr Gabriele Unger 1 General Manager
Maria De Rycke 2 Communications Manager
Margherita Locatelli 3 Project Assistant
Jakob Smets 4 Manager
Marina Vese 5 Manager
Rebecca Weicht 6 Capability Building
and Training Manager** Until December 2022.

23

Governance

TfS is an international, non-profit association under Belgian law.

TfS General Assembly

The highest decision-making body of theorganisation, the TfS General Assembly,
is composed of one CPO representative
per member company who holds the voting
rights in the Association.
The TfS General Assembly approved an
update of the TfS Articles of Association
relating to the 50% increase in TfS
membership fees, effective 2022.
A commitment to CO2 reduction in the value
chains will also be anchored in the TfS Articles
of Association and membership criteria.

TfS Steering Committee

The TfS membership criteria now includes
that an applicant company:•	is committed to climate action in line with
the Paris Agreement.
•	implemented reduction targets of GHG scope
1 and scope 2 emissions andpublishes targets and progress.
•	is committed to putting a programme in place
to reduce Scope 3 GHG emissions
in its supply chain and to contribute to the
TfS programme on Scope 3 GHG Emissions.
The TfS General Assembly elects the TfS
President and TfS Steering Committee every
two years. The next election will be in 2023.

1

2

3

4

5

6

7

8

The Steering Committee is the executive body of the association.
As of May 2021, the TfS Steering Committee consistsof the following persons:

The 2022 TfS General
Assembly featured
both in-person andonline attendees
TfS Activity Report 2022

TfS Organisation

President: Bertrand Conquéret 1 (Henkel)
Steven Brughmans 2 (BASF)
Joachim Christ 3 (Merck)
Lynn De Proft 4 (Solvay)
Erk Thorsten Heyen 5 (Wacker)
Markus Mirgeler 6 (Clariant)*
Thomas Udesen 7 (Bayer)
Nicola Comiotto 8 (Clariant)* Until November 2022. Markus Mirgeler was replaced by colleague Nicola Comiotto,
CPO Clariant. Mr Comiotto will take the Clariant seat for the remaining time of the two-year term
(until the TfS General Assembly of 2023).

24

Learn more

TfS website
Your information platform for all TfS info,
including the latest news on the TfS Scope 3
GHG emissions programme, PCF Guideline,
and TfS Academy.

TfS YouTube channel
Containing several videos
that help you better
understand TfS, its strategy,
activities, and processes.

TfS LinkedIn
Connect and follow TfS on
LinkedIn to stay abreast of thelatest TfS news and activities.

TfS Academy
Capability-building hub for TfS
members and their procurement
team, as well as for suppliers,
to learn about the most pertinentand trending sustainability
procurement topics.

TfS Anniversary website:
Keynote, speeches, and panelsession recordings of the global
TfS Anniversary celebration“TfS – 10 years in the future” (2021).
View or download videos in English,
Spanish, Portuguese, and Chinese.

TfS Activity Report 2022

Learn more25

tfs-initiative.com© Together for Sustainability, 2023

TfS Activity Report 2022

26