Sustainability Report 2021
Title image Our photovoltaic plant at the Jinan factory, China, is the largest in the world. With an expected output of 4,500,000 kilowatt hours, 4,200 tonnes of CO2 could be saved. More on this in Chapter 5. Notice within the meaning of the General Act on Equal Treatment (AGG) Where only the masculine form is used in this report, this is done for linguistic simplification purposes only. Based on our position and the principles of the General Act on Equal Treatment, the information provided refers equally to all genders. The use of only one gender form should not be a gender-specific discrimination, but only serves the purpose of better readability and better understanding of the pages and the formulations used on them. The detailed report profile can be found on page 94. Table of contents Preface . . . . . . . . . . . . . . . . . . . . . . 5 Festo in summary 6 1. Strategy and sustainability management 8 1.1 Industrial transformation as a business model . . . . . 10 1.2 Sustainability strategy and management . . . . . . . 12 2. Festo footprint . . . . . . . . . . . . . . . . . 16 2.1 Regional distribution of purchasing volume 18 2.2 Sustainable procurement . . . . . . . . . . . . . 19 2.3 Networks and committee work . . . . . . . . . . . 21 3. People at Festo 22 3.1 Staff development . . . . . . . . . . . . . . . . 24 3.2 New working world: ‘new normal’ . . . . . . . . . . 27 3.3 Diversity . . . . . . . . . . . . . . . . . . . 28 3.4 Training . . . . . . . . . . . . . . . . . . . . 31 3.5 Further training . . . . . . . . . . . . . . . . 32 3.6 Safety at work . . . . . . . . . . . . . . . . . 34 3.7 Holistic health promotion 37 4. Ethics and governance . . . . . . . . . . . . . . 38 4.1 Compliance . . . . . . . . . . . . . . . . . . 40 4.2 Human rights . . . . . . . . . . . . . . . . . . 42 5. Environment, energy and construction . . . . . . . . 44 5.1 Environmental management . . . . . . . . . . . . 46 5.2 Photovoltaics . . . . . . . . . . . . . . . . . . 54 6. Resource and material efficiency . . . . . . . . . . 56 6.1 Packaging . . . . . . . . . . . . . . . . . . . 58 6.2 Use of aluminium 59 6.3 Scrap reduction in the plant 59 6.4 Consideration of applicable guidelines and laws . . . . 59 6.5 Ecological life cycle of our products . . . . . . . . . 61 7. Climate protection and energy efficiency . . . . . . . 62 7.1 Energy efficiency . . . . . . . . . . . . . . . . 64 7.2 Festo Energy Saving Services . . . . . . . . . . . . 66 8. Technical basic and further training and corporate educational responsibility (CER) 68 8.1 Energy innovation . . . . . . . . . . . . . . . . 70 8.2 CO2 monitoring in ongoing production 71 8.3 Festo Learning Experience (Festo LX) 72 8.4 Bionics and STEM offerings for secondary education . . 74 8.5 Learning through competitions . . . . . . . . . . . 76 9. Impact on our customers and society . . . . . . . . 78 9.1 Fibre balls to combat micro-pollutants 80 9.2 Safe production of batteries for electric vehicles . . . . 81 9.3 Digitisation promotes sustainability . . . . . . . . . 82 9.4 Social commitment 83 9.5 Learning solutions in solar and wind energy technology 84 9.6 Disposable gloves produced quickly and safely 84 9.7 LCM 2021 conference: Festo as industrial co-chair . . . . 85 10. GRI index . . . . . . . . . . . . . . . . . . . 86 11. Report profile 94 Because the photographic material was taken during the coronavirus pandemic, the photographs of people were taken in accordance with the precautionary and protective measures in force and recommended at the time. 3
GRI 102-14, GRI 102-16 Keep up to date: Visit www.festo.com/responsibility Dear Readers, A family-run company like Festo stands for responsibility – for customers, employees and society as a whole. The term ‘sustainability’ does not only shape the way we think and act, but is our aspiration to contribute to global sustainability with our competence in factory and process automation and our technical qualifications. Automation from Festo helps vital resources to be used and preserved intelligently and new production technologies to be used efficiently. Automated production processes can relieve people in their daily work and improve health and nutrition. Digital training systems are contributing to new fields of work being opened up around the world. Automation also enables local-for-local production, shortening transport routes and value chains and reducing emissions. We made further progress in implementing our Festo 2020+ sustainability strategy in 2021 and made extensive decisions on climate protection in particular. All of our global production and logistics sites, the German sales locations and the company headquarters in Esslingen will already be climate-neutral by the end of 2023. All other Festo local sales companies in over 60 countries are set to follow by 2026. Festo will also increasingly generate the energy required at its locations using its own photovoltaic systems. Where energy consumption is higher than the potential provided by generating our own energy, green electricity will be used. Our products, solutions and applications will also increasingly be developed with the aim in mind that they are themselves sustainable: in production, in operation and at the end of their product life cycle. Energy-efficient components do not just save costs over their service life, but also protect the climate. I hope you enjoy reading the Corporate Responsibility Report 2021. Oliver Jung Chairman of the Management Board at Festo SE & Co. KG Preface 4 5 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
22% 63% 15% Asien Europa Amerika 22% 62% 16% Asien Europa Amerika 22% 62% 16% Asien Europa Amerika 63% E/ME 15% The Americas 22% Asia 62% E/ME 16% The Americas 22% Asia 60% E/ME* 16% The Americas 24% Asia 2021 2021 20,757 EUR 239 million 2021 52,166 t CO2 equivalents 2021 EUR 3.1 billion EUR 2.8 billion EUR 3.4 billion As an independent family-run company in its third generation, Festo thinks and acts long term and with a sense of responsibility. Our company, Festo, stands for clear values, the highest quality and customer-oriented innovation. In the fields of industrial automation and technical training, Festo has set standards from its beginnings and has thus contributed to sustainable development in terms of the environment, business and society. Number of employees in 2021 Legend Europe Scharnhausen (Germany) St. Ingbert- Rohrbach/Hassel Biel (Switzerland) Česká Lípa (Czech Republic) Budapest (Hungary) Sofia (Bulgaria) Short delivery times, the right service and a high degree of flexibility – the demands of the global markets are constantly increasing. That is why we are where our customers are. With our own companies and 250 branches in 62 countries. EUR 240 million 2019 2019 Festo in summary Africa Nigeria South Africa The Americas Argentina Brazil Canada Chile Colombia Mexico Peru USA Venezuela Australasia Australia New Zealand Asia China Hong Kong India Indonesia Japan Korea Malaysia Philippines Singapore Taiwan Thailand Vietnam Austria Belarus Belgium Bulgaria Croatia Czech Republic Denmark Dubai Estonia Finland France Germany Greece Hungary Iran Ireland Israel Italy Jordan Kazakhstan Latvia Lithuania Netherlands Norway Poland Portugal Romania Russia Serbia Slovakia Slovenia Spain Sweden Switzerland Turkey Ukraine United Kingdom GRI 102-4, GRI 102-5, GRI 102-7, GRI 102-45, GRI 201-1 113 employees in Africa 82 employees in Australia 14,712 employees in Europe 2,364 employees in the Americas 3,486 employees in Asia Employees worldwide CO2 emissions (scope 1 and scope 2) Research and development services Production sites Distribution centres Singapore Shanghai (China) Jinan (China) Bangalore (India) São Paulo (Brazil) Mason (USA) 2019 2020 Total sales by region 53,250 t CO2 equivalents 2020 EUR 226 million 2020 2019 20,878 2020 20,422 68,924 t CO2 equivalents Europe/Middle East (E/ME) 6 7 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
1. Strategy and sustainability management The United Nations (UN) has formulated 17 Sustainable Development Goals (SDGs), which are intended to ensure sustainable development worldwide on an economic, social and ecological level. These goals are aimed at everyone: politics, business, science – and every single citizen is called upon to make their contribution. For companies like Festo, transparency, a sustainability strategy based on the SDGs and systematic sustainability management are key elements on the way to achieving this goal. GRI 103-1 8 9 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
Further processing Customers of customers Didactic Customers Didactic Production and logistics Customers Factory and process automation Customers of customers Automation Further processing Raw materials and supplies Research and development 1. Strategy and sustainability management 1. Strategy and sustainability management 1.1 Industrial transformation as a business model Digitisation, individualisation, education and climate protection are the driving forces behind industrial change and cover all stages of value creation – from development, production, logistics and energy supply to services. The Festo Group is a leading global provider of automation technology and technical training and further education, divided into the Automation and Didactic business divisions. Important industry segments are automotive, food and packaging, electronics and assembly, biotech, pharma and cosmetics, chemicals and water, as well as – with growing importance – medical technology and laboratory automation (life tech), which have been in focus since the beginning of the pandemic. Festo also supports all automated process steps in the field of electromobility, from battery production to the production of electric vehicles. The Automation business division The Automation division offers a wide range of solutions for factory and process automation: the business purpose comprises the development, manufacture and sale of pneumatic and electrical components, technical systems and services as well as the transfer of knowledge for automation tasks such as control, regulation, positioning and handling of machines, apparatus and technical processes. In terms of customer solutions, the increasing demand for energy and resource efficiency and humanisation of work is becoming a competitive factor in all industry segments. The Didactic business division The group’s activities in the Didactic division stand for technical basic and further training and, for more than five decades, have included the continuous development of professional, industry-oriented learning products and services relating to automation technology. The educational offerings focus on pneumatics, hydraulics, electronics and mechatronics as well as sensor technology, robotics, CNC and fieldbus technology. Festo Didactic is a system partner of companies as well as private and public educational institutions to make and keep people fit for work through education and training and to allow them to participate in economic development. GRI 102-2 The value chain in the automation sector is currently participating in the global industrial transformation processes. Automation technology is changing from components to smart components with software. Digitisation permeates all value creation processes and changes business models. The speed of innovation is increasing. Virtual simulations create security for real investments. The use of artificial intelligence and new technologies such as piezo technology and superconductivity opens up new technical solution areas in industry for Festo. The main driver of business activities, apart from digitisation, is global growth. The value-added chains of the Festo Group will become more international in the coming years. Nevertheless, globalisation is reaching its limits. The global trend towards ‘local for local’ is calling previous value-added chains into question and increasing the pressure on productivity in procurement, production and logistics at all locations around the world – for us and our customers. Online business is becoming increasingly important. With regard to supply chains, there were no significant changes at Festo in the reporting year. Nevertheless, we are increasingly trying to procure raw materials in the countries where production takes place. GRI 102-10, GRI 102-48 Acquisitions No acquisitions were made in 2021. GRI 102-10 10 11 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
14 7 15 2 17 10 11 5 1 16 6 3 12 4 8 13 9 Watch list Ongoing Relevance for internal stakeholder Relevance for external stakeholder Focus area 1. Strategy and sustainability management 1. Strategy and sustainability management 1.2 Sustainability strategy and management Thinking in terms of generations to come and responsible and sustainable economic activity are deeply rooted in the corporate DNA, particularly in family companies such as Festo, and are expressed in the term ‘corporate responsibility’ (CR) and sustainability management. This chapter describes the further development of sustainability management and provides an outlook on the focal points of our 2020+ sustainability strategy. At Festo, the tasks of the Corporate Responsibility department include the conception and implementation of an international sustainability strategy, sustainability management and CR reporting. GRI 102-2, GRI 102-18 Development of the areas for action The development of the areas for action (page 14) of our sustainability strategy is based on the identification of the Sustainable Development Goals that are relevant for our company. In the autumn of 2015, the United Nations General Assembly adopted the 17 SDGs. We at Festo are committed to supporting the goals formulated therein as part of our own sustainability strategy. Identification of key issues The interests of both internal and external stakeholders were taken into account in the identification of topics. There are two groups within the external and internal stakeholders. ‘Formative stakeholders’ have concrete expectations of Festo as a company and also have a direct influence on its business activities. In addition, there are ‘other stakeholders’ whose interests are taken into account but whose influence is considered to be rather limited. In concrete terms, these two categories are as follows: Formative stakeholders • Shareholders • Management Board • Customers and their customers • Employees Other stakeholders • Suppliers • Local population • Science • Public • Non-governmental organisations (NGOs) • State • Supervisory institutions GRI 102-40, GRI 102-42, GRI 102-43, GRI 102-44 In identifying the important SDGs and deriving areas of action, the results of the stakeholder analysis were supplemented by monitoring external changes in the areas of legislation, business and politics, technology, energy, environment and society. On this basis, we regularly review our strategic orientation as well as our sustainability goals and measures. GRI 102-31 The process resulted in an updated materiality matrix. In this, topics classified according to materiality are divided into the categories ‘Watch list’, ‘Ongoing’ and ‘Focus area’. GRI 102-46, GRI 102-47, GRI 102-49 Topics relevant to Festo Currently, the greatest opportunities for Festo to make an impact have been identified in the implementation of the following SDGs: • Good health and well-being (SDG 3) • Quality education (SDG 4) • Clean water and sanitation (SDG 6) • Decent work and economic growth (SDG 8) • Industry, innovation and infrastructure (SDG 9) • Responsible consumption and production (SDG 12) • Climate action (SDG 13) Festo has very different influences on the 17 SDGs of the UN. The goals to which we as a company can make a relevant contribution are highlighted above. 12 13 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
andenergyefficiency Climateprotection Technical basic and People at Festo efficiency Resource andmaterial Festofootprint Impact onour customersandsociety further trainingandCER Ethics and governance construction Environment, energyand 1. Strategy and sustainability management 1. Strategy and sustainability management 2020+ sustainability strategy Our 2020+ sustainability strategy was adopted by the Management Board of Festo SE & Co. KG in March 2020 and is now subject to regular updating. Parts of the sustainability strategy are now part of the corporate strategy. People at Festo Within this area of action, we will continue to work on the longterm issues relating to the qualification and further development of our employees, the expansion of occupational health promotion and safety, and equality and diversity. Since 2020, the focus has been, and is, on measures to protect employees from Covid-19. Chapter 3 Ethics and governance One focus of the field of action ethics and governance is our global compliance management system. In addition, the integration of corporate due diligence obligations for human rights will be an essential component. Chapter 4 Environment, energy and construction In accordance with a resolution passed by the Management Board in December 2021, Festo will neutralise the direct (scope 1) and indirect (scope 2) CO2 emissions associated with energy procurement in its global production network, headquarters and German sales company by the end of 2023. The other national Festo companies and Festo Didactic are to follow by the end of 2025. We are guided by the scientifically defined target of limiting global warming to 1.5°C. We will achieve this by procuring CO2-neutral green electricity as well as through measures to increase energy efficiency and expand our own renewable energy generation facilities at our sites, supplemented by the temporary participation in compensation projects. Data management and the expansion of the balance sheet framework will be a focus in 2022. Chapter 5 As part of our ISO 14001-certified international environmental management system, we will also work to improve our environmental performance with regard to other environmental aspects such as water use and waste reduction. Resource and material efficiency Our measures focus on the entire value creation process. Projects to save materials in our products lead to a more careful use of resources in our procurement. Increasing the environmental compatibility of our packaging concept leads to lower environmental impact from the point of purchase to the customer. Increasing the efficiency of resources and materials is a priority at our plants. The continuous reduction in the number of defective goods and the consistent fluid management in metalworking are just a couple of examples. Chapter 6 Climate protection and energy efficiency Delivering our products to our customers for their use on-site results in significantly higher CO2 emissions compared to our manufacturing processes. That is why we will continue to expand our Energy Saving Services which will help our customers to reduce their energy consumption-related CO2 footprint significantly in the next few years. This service is supplemented by advice on the energy-efficient planning and designing of our products. Chapter 7 The development of energy-efficient and smart products and solutions is another important element in our efforts to help our customers increase their climate-friendly production. We also want to optimise our delivery processes with regard to the associated CO2 emissions. Measures include the procurement and manufacture of our products centred around the sales market and the reduction of air freight by transferring it to rail or ship transport. We will report on the results of the individual projects. Technical basic and further training and CER Along with climate protection, technical basic and further training is the most important pillar in our efforts to become sustainable. Chapter 8 Examples of our activities are: • Learning solutions as the key to environmentally friendly innovations • Making high-quality learning content accessible to as many people as possible with the Festo LX digital learning portal • Getting young people excited about technical topics with Bionics4Education • Promoting learning through competitions with numerous activities Our activities relating to the areas of action in the reporting period of 2021 and their effects on procurement, our customers and society are explained in the following chapters with the help of corresponding GRI indicators. 14 15 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
2. Festo footprint Sustainability can be divided into three areas: economy, ecology and social issues. A balance between these areas is important for sustainable development. In a globalised economy, companies must take responsibility for this balance, both in their own footprint and that of their suppliers. Festo faces up to this responsibility and represents this attitude along the entire value chain. Through our involvement in various networks and initiatives, we communicate openly with a wide range of stakeholders and partners and are clearly committed to the defined standards and guidelines. This is because our responsibility does not end at our factory gates. GRI 103-1 16 17 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
17% 76% 7% Asia Europe The Americas 18% 74% 8% Asia Europe The Americas 20% 71% 9% Asia Europe The Americas 30% 70% Not local Local 22% 13% 51% Plastics Aluminium Stainless steel 2% Zinc Steel Brass 3% 9% 22% 13% 51% Plastics Aluminium Stainless steel 2% Zinc Steel Brass 3% 9% 20% 72 % 8% Asia Europe The Americas 22% 78% Not local Local 22% 78% Not local Local 29% 71% Not local Local 19% 11% 56% Plastics Aluminium Stainless steel 2% Zinc Steel Brass 3% 9% 19% 11% 56% Plastics Aluminium Stainless steel 2% Zinc Steel Brass 3% 9% 2020 2021 GRI 301-1: Distribution of the purchasing volume by materials 2. Festo footprint 2. Festo footprint 2.1 Regional distribution of purchasing volume Industrial production has largely detached itself from the effects of the pandemic situation and is increasing in all regions. This is also reflected in Festo’s direct and indirect purchasing volume (production materials and non-production materials), which increased to 1,550 million euros in 2021. Non-production materials refer to all production plants (Festo Global Production Centres – GPCs), local sales companies and production materials. GRI 204-1 Festo is constantly expanding its global supplier network, consisting of local and non-local suppliers. By ‘local’ we mean procurement within the country of the respective national Festo company. Compared to the previous year 2020, the number of local suppliers has remained constant in 2021. The ‘local for local’ strategy will continue to be pursued in 2021 to enable a reduction in delivery times throughout the supply chain as well as a reduction in transport routes. The aim continues to be to increasingly procure goods in those countries where production takes place. 2018 EUR 1,619 million 2019 EUR 1,388 million 2020 EUR 1,246 million 2021 EUR 1,550 million 2021 EUR 1,550 million 2018 EUR 1,619 million 2019 EUR 1,388 million 2020 EUR 1,246 million GRI 204-1: Regional distribution of the direct and indirect purchasing volume of the Festo Group 2.2 Sustainable procurement Festo’s purchasing structure is characterised by the procurement of semi-finished products, components and finished parts. Aluminium, steel, or stainless steel, and plastic are among the most important materials. The products purchased by Festo have an ecological effect on several levels. In addition to the finite nature of resources, the consequences of raw material extraction and the resulting CO2 emissions must be taken into account. For the year 2021, we have succeeded for the first time in estimating the latter quantitatively. Due to increased incoming orders, the quantities purchased have risen compared to last year. The quantities of materials purchased in 2021 in tonnage have been visualised in the diagram below. GRI 301-1 More than half of the raw materials purchased to manufacture our products are primary and secondary aluminium components (cf. chapter 6). Around 20 per cent relate to steel or stainless steel, 19 per cent are plastic granules or parts and 4 per cent are other metals. Furthermore, prefabricated electrical components and electromagnets are used. In addition to production materials, non-production materials such as vehicles, IT infrastructure and operating materials as well as services must be taken into account. The aluminium supply chain begins with the mining of bauxite. The raw material for aluminium production has adverse effects on the environment depending on the mining region. The great economic importance and the supply risk of bauxite led to bauxite being declared a critical raw material by the European Union in 2020. By sourcing secondary aluminium, we save up to 90 per cent of emissions and conserve bauxite stocks. GRI 102-9 The CO2 emissions during the production of individual materials differ considerably. Besides aluminium, purchased electronic components, stainless steel and new plants and buildings have the greatest impact. Preliminary calculations show a total amount in 2021 of 359,717 tonnes of CO2 equivalents, which were generated during the production of purchased materials and the use of services. The quality of the data is improved continuously. 18 19 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
Networks and committee work Automation Didactic • 5G Alliance for Connected Industries and Automation (5G-ACIA) • Working group for Business and Human Rights of the German Engineering Federation (VDMA) • Stuttgart CSR network • Various employer associations • European industry umbrella organisation ORGALIM (indirectly via VDMA and ZVEI) • EuropElectro (representing the interests of European industry in China) • Fraunhofer Institute for Production Systems and Design Technology • ISO and IEC standardisation committees for automation technology • Industry 4.0 platform • Stiftung KlimaWirtschaft – German CEO alliance for climate and economy • SustaiNet – business network • VDMA Blue Competence sustainability initiative • German Electrical and Electronic Manufacturers’ Association (ZVEI) • ADEA – Association for the Development of Education in Africa • German-African Business Association • CIRP – Collège International pour la Recherche en Productique – International Academy for Production Engineering • Didacta Association • Don Bosco Tech Africa • European Institute of Innovation & Technology (EIT) • iMove • German Asia-Pacific Business Association • Eastern Europe Business Association of Germany • Industry 4.0 platform • UN organisations such as UNESCO, UNIDO, UNICEF, UNHCR • VDMA • WEF – Advanced Manufacturing and Production • Worlddidac • WorldSkills Africa • WorldSkills international 2. Festo footprint 2. Festo footprint Environmental and social standards for suppliers The commitment and monitoring of our suppliers for compliance with social and environmental standards is part of our corporate responsibility. At Festo, every supplier (100 per cent) is therefore evaluated and checked with regard to environmental and social criteria. GRI 308-1, GRI 414-1 In 2021, the Code of Conduct for Business Partners (BP CoC for short) was rolled out globally. All suppliers must confirm compliance with our BP CoC with their signature. By signing this document, our suppliers undertake to demand compliance with these agreements from their suppliers as well. If the responses are not satisfactory, appropriate action is taken. Festo is careful not to accept any supplier with a risk. GRI 308-1, GRI 414-1 Evaluation according to environmental criteria All our suppliers go through defined processes in which they are evaluated according to various criteria. A distinction is also made for technologies and production processes with higher or average environmental impacts. For suppliers with a higher environmental impact, certification according to ISO 14001 (or the Eco-Management and Audit Scheme – EMAS) is required. Alternatively, Festo will conduct an environmental audit at the supplier’s premises. Due to Covid-19, no environmental audits of suppliers could be carried out in 2021. For dealers (distributors), the certification of the actual manufacturer is used. GRI 308-2 Evaluation according to social aspects Since the introduction of the sustainability audit in 2017, a total of 270 suppliers from 31 countries worldwide have been checked using social criteria. No negative effects were found. GRI 414-1, GRI 414-2 The Festo Group is guided by the principles of the Business Social Compliance Initiative (BSCI) to establish an ethical supply chain. Festo will not tolerate any infringement. GRI 407-1, GRI 408-1, GRI 409-1 The existing supplier self-assessment was expanded in 2021 with regard to evaluation according to social aspects, resources and material efficiency and the use of conflict minerals. GRI 308-2, GRI 414-1 Dealing with conflict minerals In order to support the sustainable use of conflict minerals, we disclose the smelters from which the raw materials for our products come within the framework of the Responsible Business Alliance. By filling out the Conflict Minerals Reporting Template (CMRT), we are helping to create the necessary transparency to continuously increase the proportion of certified smelters worldwide. Festo expects its business partners to comply with all applicable regulations regarding conflict minerals. www.festo.com/compliance 2.3 Networks and committee work Partnerships and networks mean significant added value for mutual exchange and working across corporate boundaries. Our Automation and Didactic business divisions work both nationally and internationally as part of various committees and associations concretely on the issue of sustainability. An allocation is shown in the chart below. GRI 102-12, GRI 102-13 20 21 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
In order to live up to our mission and promise every day, the development of a sustainable workforce is a must. We therefore see lifelong learning as an essential part of our corporate culture. We put people at the centre and create the foundations for a secure and trusting relationship. At Festo, protection of labour, corporate health promotion and respect for valid employee rights form the basis for this. We offer fair and performance-related pay as well as flexible working models to improve work–life balance. This is because a healthy, motivated and efficient workforce is the guarantee for success for every company. GRI 103-1 3. People at Festo 22 23 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
3.1 Staff development Committed, performance-oriented, qualified and adaptable employees are one of the prerequisites for Festo’s business success. We therefore strive to attract, retain and develop the best employees. In 2021, the Festo Group had a total of 20,757 employees in 62 countries worldwide. GRI 102-8 Employment contracts by gender and region The total number of permanent and temporary employment contracts is shown in the graphic below. There are also activities carried out by trainees and students that do not fall into these two categories. In 2019, this number was 599, in 2020 the number was 582 and in 2021 the number increased to 753. GRI 102-8 New employees and employee turnover The following shows both the total number of new employees and employee turnover by gender, age group and region. In 2020, there was a reduced employee turnover due to the pandemic. In 2021, the employee turnover is at the same level as before the pandemic. GRI 401-1 Attractive employer All in all, various programmes and measures help Festo to position itself as an attractive employer. With solutions such as working remotely and new concepts for the ‘new normal’, we offer our employees further attractive options for individual organisation of their working hours. 3. People at Festo 3. People at Festo 3% 26% 65% 6% temporary, female permanently employed, female permanently employed, male temporary, male 3% 26% 65% 6% temporary, female permanently employed, female permanently employed, male temporary, male Asia (3,551) 71% 29% Europe (6,030) 5% 95% The Americas (2,332) 100% Germany (8,236) 5% 95% 0 20 40 60 80 100 temporary permanently 3% 26% 64% 7% temporary, female permanently employed, female permanently employed, male temporary, male 3% 26% 64% 7% temporary, female permanently employed, female permanently employed, male temporary, male Asia (3,699) 64% 36% Europe (5,870) 6% 94% The Americas (2,273) 1% 99% Germany (8,437) 6% 94% 0 20 40 60 80 100 temporary permanently Asia (3,699) 64% 36% Europe (5,870) 6% 94% The Americas (2,273) 1% 99% Germany (8,437) 6% 94% 0 20 40 60 80 100 temporary permanently 3% 26% 65% 6% temporary, female permanently employed, female permanently employed, male temporary, male 3% 26% 65% 6% temporary, female permanently employed, female permanently employed, male temporary, male Asia (3,513) 69% 31% Europe (5,834) 4% 96% The Americas (2,273) 100% Germany (8,224) 5% 95% 0 20 40 60 80 100 temporary permanently GRI 102-8: Information on employees and employment by gender and region Employees by gender and region in 2021 20,149 Employees by gender and region in 2020 Employees by gender and region in 2019 20,279 19,841 female male 36% 64% female male 32% 68% 15% 35% 29% 21% The Americas Europe Germany Asia 9% > 50 years 55% < 29 years 36% 30−49 years 12% 36% 33% 22% The Americas Europe Germany Asia 19% > 50 years 39% < 29 years 41% 30−49 years female male 31% 69% female male 32% 68% 20% 44% 16% 20% The Americas Europe Germany Asia 9% > 50 years 52% < 29 years 39% 30−49 years 13% 33% 28% 26% The Americas Europe Germany Asia 25% > 50 years 31% < 29 years 44% 30−49 years GRI 401-1: New employees and employee turnover by gender in 2020 GRI 401-1: New employees and employee turnover by age in 2020 995 1,651 New employees in 2020 Employee turnover in 2020 995 1,651 995 1,651 GRI 401-1: New employees and employee turnover by gender in 2021 GRI 401-1: New employees and employee turnover by age in 2021 GRI 401-1: New employees and employee turnover by region in 2020 2,046 2,107 New employees in 2021 Employee turnover in 2021 2,046 2,107 2,046 2,107 GRI 401-1: New employees and employee turnover by region in 2021 24 25 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
3.2 New working world: ‘new normal’ The coronavirus pandemic has also changed the world of work. Working from home has been the order of the day for many employees at our German locations since March 2020. However, what will the world of work look like after the coronavirus pandemic? Will employees spend every working day back in the office? How will you be able to work most efficiently in the future and where will which task be completed most effectively? The concepts of new work, ‘new normal, new work’, deal with precisely these questions. Remote work, working digitally, working models, office concepts, etc. are just a few keywords that also influence Festo. As an attractive employer, Festo is therefore already working on its first pilot projects. Four pilot projects Festo is currently running four pilot projects in which colleagues are testing a possible working model of the future: flexibly switching between remote and in-person work. The idea is to work without a fixed workplace, with bookable work options in different zones – e.g. a quiet work zone, a communication zone or a meeting zone. The pilot projects will test whether such a flexible working model makes sense for the first time – and, above all, what needs to be taken into account in everyday working life. The biggest change will probably affect one’s own desk one day: there should only be a few workplaces that are permanently designated to certain people. For example, colleagues that reliably work in the office almost every day. With the first pilot projects, Festo hopes to gain insights into what an office working environment could and could not look like in the future. Revolving mobile and in-person work Mobile work has established itself as an important supplement to working in the office. And also among the participants of the pilot project, the tendency is clear from the start: in future, the majority want to intermittently take advantage of mobile work and therefore not be permanently present in the office. In the pilot areas, Festo is therefore currently testing the shared-desk model and standardised equipment such as a docking station and monitor. Social solidarity However, social and collegial solidarity should not be underestimated as part of the transformation of the world of work. Therefore, the question is: how can Festo manage to combine ‘the best’ of both worlds and integrate this into everyday work on a long-term basis? Findings from pilot projects influence the new normal at Festo Regular feedback opportunities will be held to record and reflect on the experiences of the colleagues in the pilot projects: how will the shared desk work, for example? What (perhaps still unforeseeable) obstacles are there? The pilot projects were carried out in coordination with industrial safety, the works council and in accordance with the specifications for occupational health and safety. Our offer of individual organisation of working hours goes beyond the models regulated by law in some countries (part-time work, parental leave and care leave). Self-determined and flexible working enables a better work–life balance in the age of digitisation. In this context, mobile work is a format in which the work tasks can also be fulfilled outside the company premises. All employees in Germany – regardless of whether they work parttime or full-time – receive fair overall remuneration and attractive social benefits such as: • L imited places in nurseries for children of employees. • F amily service and social counselling by external counselling partners. • Holiday care for children of employees. • Company pension scheme. • S ocial fund for special financial burdens (Freud- und Leidkasse). • Variety of sports and health offers. • F urther training (face-to-face and e-learning) and innovative learning offers. • Options for bicycle leasing with employer subsidy. • S ubsidised canteens or meal subsidies for our branch offices. 3. People at Festo • Discounts on various discount portals and with regional partners. • D iscounts on local public transport at the Esslingen site. • Special leave (e.g. wedding, moving house or birth of child). GRI 401-2 Total remuneration and collective agreement The total remuneration package consists of a monthly basic salary, a performance-related remuneration component and a number of additional benefits such as a company pension scheme. This enables fair remuneration for personal performance and promotes employee motivation. Remuneration is based on tasks or activities and is therefore independent of gender. GRI 405-2 The appreciation and responsibility towards our employees is reflected in good remuneration and working conditions, which at least meet all relevant local and legal requirements. In Germany, the companies Festo SE & Co. KG, Festo Didactic SE, Festo Polymer GmbH and Festo Vertrieb GmbH & Co. KG are subject to the collective agreement of IG Metall. GRI 102-41 3. People at Festo 26 27 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
28% 15% 57% > 50 years < 29 years 30−49 years female male 29% 71% female male 11% 89% 27% 16% 57% > 50 years < 29 years 30−49 years 50% 0% 50% > 50 years < 29 years 30−49 years 46% 0% 54% > 50 years < 29 years 30–49 years female male 29% 71% female male 11% 89% 29% 14% 57% > 50 years < 29 years 30−49 years female male 30% 70% female male 11% 89% 52% 0% 48% > 50 years < 29 years 30−49 years By gender in 2020 By gender in 2020 20,278 949 1,176 19,840 By age in 2020 By age in 2020 GRI 405-1: Diversity by gender and age Employees Management bodies By gender in 2019 By gender in 2019 By age in 2019 By age in 2019 949 20,278 1,176 19,840 By gender in 2021 20,149 By age in 2021 20,149 By gender in 2021 1,175 By age in 2021 1,175 Festo Group total 105 nationalities Festo SE & Co. KG 72 nationalities Asia 28 nationalities The Americas 31 nationalities Europe 77 nationalities (without SE & Co. KG) GRI 405-1: Diversity by nationality in 2021 3.3 Diversity In our globally active company, employees and business partners of different nationalities, cultures, religions and approaches to life come together. Respect, tolerance, appreciation, fairness and openness are the basic requirements for this cooperation. Diversity by nationality We are convinced that mixed teams can work more creatively and efficiently than homogeneous groups. In terms of origin, we continue to benefit from the cultural diversity of our workforce. In 2021, employees from 105 nations successfully came together at Festo. This diversity helps us, as a company active in more than 60 countries, to understand the specific needs of our customers worldwide. You can find more on diversity by nationality in the top chart on the right. Diversity by age and gender In 2020, a total of 1,176 people were employed in senior management (levels E, F1 and F2) worldwide. This corresponded to about 6 per cent of the total workforce. In 2021, the number of people in senior management remained constant. The charts on the following page show the diversity of management bodies and employees by age and gender. GRI 405-1 Against the backdrop of demographic change and the promotion of diversity within the company, we have been encouraging our managers since 2020 to evaluate female employees and younger junior staff in terms of their potential and a next career step and prepare them for our talent management programme. 3. People at Festo Women@Festo – the women’s network at Festo Women@Festo is a network of women for women within Festo Germany. The women’s network, human resources and the ‘Work and family of the works council Esslingen’ committee conducted a survey on equal opportunities in May 2021. The aim was to find a status quo. In addition, the survey results were subsequently discussed in a workshop with 160 female colleagues, the Women@ Festo network, the head of Personnel and the works council, and possible fields of action were defined. The first immediate measure was and is to improve communication on the offers already provided by Festo for its employees. The format ‘Women@Festo asks ...’ was implemented here. Other measures will follow. The survey was directed at all female employees at the Esslingen locations with access to a PC. The Esslingen colleagues currently without access to a PC and the colleagues at the Saarland locations will be interviewed at a later date for technical reasons. In total, over 1,300 women were contacted and 666 took part in the survey. Proud@Festo – the LGBTIQ network at Festo Proud@Festo is the LGBTIQ network (lesbian, gay, bisexual, transgender, intersex, queer) at Festo. The aim is to network LGBTIQ people and staff who uphold the visibility of diverse characters and lifestyles and for a tolerant life together. Specifically, it is about: • Promoting visibility and acceptance. • Enable networking. • Being a point of contact for employees and management. • Providing impetus on LGBTIQ issues in the company. • Supporting the Festo Corporate Responsibility. • Representing Festo in the context of LGBTIQ beyond company borders. 3. People at Festo 28 29 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
In 2021, one case was reported, processed and closed in Germany. Following a complaint, the responsible manager is made aware of their responsibilities. GRI 406-1 Inclusion at Festo By signing the inclusion agreement, the Festo Group in Germany would like to support the requirements set out in the employer duties defined in the German Social Code, book 9. The design options of severely disabled people and the representation of their interests are taken into account and actively promoted by the company. We see the inclusion of disabled people, especially severely disabled people and their equal rights in working life, not only as a legal obligation, but also as a social obligation, the fulfilment of which is the joint responsibility of all those involved. Inclusion is actively promoted in the following business processes and structures: recruitment and employment of severely disabled people, working time and mobile work, company promotion and qualification, workplace and work organisation, health management, prevention and company integration management. The objectives of this agreement are occupational and social inclusion and the provision of the necessary framework conditions for the participation of severely disabled people in working life at Festo. This commitment is also expressed in the Festo Group’s Code of Conduct. Compliance with the measures is jointly reviewed by the company management and the representatives of the severely disabled and the works council on the basis of the agreed measures and prepared in the annual progress report. 3. People at Festo Discrimination Festo rejects, without exception, any form of discrimination, harassment, degradation or other disparagement as well as the preferential treatment of employees or business partners on the basis of their ethnic origin, gender, religion, world view, political view, disability, age, sexual identity or other ethical, social and legally protected characteristics. Our managers and employees should be aware of their role model function here and ensure a working environment free of discrimination and harassment. The General Act on Equal Treatment (AGG) transposes four EU directives into German law. In 2021, the intranet site of the internal AGG complaint offices was launched. In addition, there was a training offensive for all members of the complaints offices. The aim was to establish a common understanding and to better understand the legal side as well as to discuss the process-related structures. Festo Germany is also committed to the ‘Respect – no room for racism’ campaign. In addition, the topic of discrimination is repeatedly addressed and discussed in various courses (such as part of the course on compliance) and also among managers. At Festo in Germany, incidents of discrimination can be submitted to a specially established complaints office. There is an established process for this, which is laid down in a regulatory agreement between the company and employee representatives. The principles and procedures of the AGG are taken into account. Internationally, incidents of discrimination can be reported on the whistle-blower portal. 3.4 Training The coronavirus pandemic was also a decisive factor for training at Festo in 2021. New normal in training In 2021, the first virtual sustainability day for second-year commercial trainees was held. Information relevant to the company on sustainability and company environmental management was conveyed interactively. Virtual ‘at-home work placements’ were continued in 2021. The training content was taught using the Festo Learning Experience (Festo LX) digital platform. International training As a global company, we also undertake responsible training activities in other countries – over and above the standards found there. Vocational education systems worldwide were also aligned with the German dual work–study system in 2021. For example, the dual bachelor programme in electrical engineering was put in place in China. The first students have already started their training. We have been training in India for three years. This year, two female CNC turning and milling apprentices already took the second and third place in a national competition and qualified to compete at federal state level – the preliminary competition for Worldskills. In Germany, two federal performance centres for mechatronics (Esslingen) and Industry 4.0 (Rohrbach) were opened. Our trainers use their expertise to prepare the participants of the German national team for the world championship of professions. Trainees worldwide The charts below show apprentice numbers worldwide throughout 2019–2021. Declining numbers of trainees in the countries are due to fluctuations in demand (including changes in occupational profiles). The total number of Festo trainees has remained almost constant on an international level. The figures for 2019 and 2020 were corrected because the definition of trainees was refined and there were isolated fluctuations. Investment in training In Germany, investments in our training amounted to around EUR 11 million in 2018, just under EUR 10.7 million in 2019, EUR 9.8 million in 2020 and approximately EUR 9.9 million in 2021. 3. People at Festo 3% 5% 20% 67% 3% Switzerland 2% USA India China Germany Hungary 3% 7% 19% 63% 7% Switzerland 1% USA India China Germany Hungary 4% 6% 22% 57% 11% Switzerland 0% USA India China Germany Hungary Trainees worldwide in 2019–2021 2019 503 trainees 2020 488 trainees 2021 552 trainees 30 31 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
2021 64,232 2020 43,772 0 10,000 20,000 30,000 40,000 50,000 60,000 70,000 GRI 404-1: Number of users of the Learning Campus worldwide 66% German expert talks 34% global expert talks 90 expert talks 63% German expert talks 37% global expert talks 4,688 participants 3. People at Festo 3.5 Further training Lifelong learning is anchored in Festo’s DNA. At Festo, employees benefit from the combination of in-person training and e-learning (e.g. so-called LearningTubes or external online courses). Due to the coronavirus pandemic, the face-to-face courses were conducted in 2021 in compliance with the applicable hygiene regulations. Since the Learning Campus was introduced in 2020, Festo no longer distinguishes between individual internal learning facilities. The Learning Campus is now the central platform for all learning offers at Festo worldwide. The aim is to offer employees a high level of flexibility to be able to further develop their skills. Learning Campus users worldwide increased from 43,772 (2020) to 64,232 (2021). This number refers to participants who can also access learning content several times on different days. It must be taken into account that digital learning times currently cannot be surveyed in a measurable way. GRI 404-1 Professions in transition: capability shift Tasks change, new skills become necessary and professions change. In future, development engineers will have to deal more with digitisation, electronics development, lightweight construction, function integration or energy efficiency. Capability shift is a process that Festo is already supporting today with specific measures. Depending on how comprehensive the individual further training needs are, there are different approaches such as ‘upskilling’, where skills can be acquired on the job, or ‘reskilling’ for employees who need completely new skills for their job. The Festo Learning Centre and Festo Didactic are closely involved in these approaches. Cooperations with external universities or other educational institutions have also been planned. The goal is to position Festo for sustainable success with future-relevant competencies within the company. GRI 404-2 In addition to the capability shift, another programme to improve employees’ competences is the PeopleExcellence programme, which aims to systematically develop and improve the employability of staff. GRI 404-2 The advancement of digitisation and the challenges posed by the coronavirus have led to an intensification of virtual training at Festo. Since 2021, current Festo-specific topics such as ‘Sustainable at Festo’ or ‘Reduce CO2 footprint’ have been communicated as part of global expert talks. The large number of over 4,600 participants shows that we are cutting edge. There are also the LearningTubes. Here, colleagues can produce instructional videos designed to impart knowledge in small sequences. In 2021, an external digital training programme was made available to all employees. By the end of 2021, over 4,700 employees had already registered. GRI 404-1 In addition, Festo Didactic has developed a digital learning portal called Festo Learning Experience (Festo LX) to be prepared for the future of learning and to create individual learning experiences for teachers and learners. The synergy effects of the different training formats have a positive impact on the learning culture at Festo. Changing leadership: Leadershift@Festo Festo’s goal is to increase the maturity level of leadership worldwide. The activities in the Leadershift@Shopfloor initiative were therefore successfully continued in 2021. Alongside team leaders, the focus was now also on the target group of value stream leaders worldwide. The Leadershift@Sales initiative was also launched. Another initiative, Leadershift@BU/R&D, focuses on managers from the business units and research and development. Parallel to the unit-specific initiatives, we have also made progress in designing collective group programmes to develop our managers. We are targeting middle management in 2022. These measures are complemented by the global introduction of 360° feedback, in which all Festo managers receive direct feedback from their employees, colleagues and superiors, allowing for one to reflection on one’s own strengths and areas of development and forms a sound basis for the individual further development of every manager. GRI 404-2 3. People at Festo GRI 404-1: Distribution of number and participants of the expert talks WeGebAU qualification programme WeGebAU stands for ‘Weiterbildung Geringqualifizierter und -beschäftigter älterer Arbeitnehmer in Unternehmen’ (further training of low-skilled and marginally employed older employees in companies). It is a support programme of the German Federal Employment Agency and serves to provide vocational training for employees. It is supposed to improve employees’ employment opportunities and skills and to counteract the shortage of skilled workers. Low-skilled workers with or without vocational qualifications are eligible for support. The condition is that they have been doing a semi-skilled or unskilled job for at least four years and can no longer carry out the job they have trained to do. These are vocational training programmes that are shortened to two thirds of the regular training duration. After passing the examination, a recognised vocational qualification is obtained. The difference between the regular salary and the vocational training salary is compensated by the German Federal Employment Agency. At Festo, the support programme was first introduced in 2017 with two employees and since then, ten employees have started vocational training – mainly as industrial mechanics. 32 33 Festo SE & Co. KG Sustainability Report 2021 Festo SE & Co. KG Sustainability Report 2021
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