Independent Auditor’s Sustainability Assurance Report
Subject Matter, Responsibilities, Objective and Scope of Assurance Report
The environmental and social data and information presented in the Annual Report on which this Assurance Report is based, also form part of our audit of the Annual Report. As further agreed with Management, we have performed work to draw conclusions in relation to each of the key principles of the AA1000 Assurance Standard: materiality, completeness and responsiveness, and to evaluate the environmental and social responsibility data and information in the Annual Report for 2007, as well as underlying systems, processes and competences that support performance.
The environmental and social responsibility reporting is the responsibility of Company Management. Our responsibility is to draw a conclusion, as well as make recommendations on the environmental and social responsibility reporting in the Annual Report.
Basis of Conclusion
We planned and performed our work based on the AA1000 Assurance Standard, and in accordance with the International Standard on Assurance Engagements (ISAE) 3000, "Assurance Engagements other than Audits or Reviews of Historical Financial Information (revised)", to obtain reasonable assurance that the environmental and social responsibility reporting in the Annual Report is free from material misstatements and that the information has been presented in accordance with the accounting policies applied. On the basis of an assessment of materiality and risk, our assurance work included an examination on a sample basis, of management and reporting systems, processes and competences that support Novozymes’ performance, as well as systems, procedures and evidence that support the social and environmental data and information disclosed in the Annual Report. Our assurance work also included interviews with members of Management and subject matter experts in key environmental and social performance areas, as well as an assessment of stakeholder engagement and Novozymes’ understanding of non-financial impacts, including its sphere of influence. In addition, we performed an assessment of the reporting against peer reporting, media reports and industry knowledge. Our activities were undertaken at selected reporting units in Brazil, China, Denmark and the USA. We believe that the work performed provides a reasonable basis for our conclusion.
Conclusion
Based on the work performed, we state our conclusion in relation to each of the key principles of the AA1000 Assurance Standard: materiality, completeness and responsiveness.
Materiality
In our opinion, the Annual Report, while mainly addressing corporate financial stakeholders, provides a fair and balanced representation of material aspects of Novozymes’ environmental and social performance.
Reported qualitative and quantitative environmental and social indicators form part of operational decision-making at Novozymes, as well as an element in Management’s balanced scorecards.
The presentation of data and information related to Novozymes’ environmental and social performance are comparable with previous years and assists key stakeholders in interpreting the Annual Report in relation to their decision-making needs.
Completeness
In our opinion, the environmental and social responsibility data and information in the Annual Report have been included as a result of relevant activities for identifying and understanding environmental and social performance and impacts. Stakeholder engagement is mostly driven through selected initiatives focused on established issues and stakeholders. Novozymes identifies and manages material aspects of its environmental and social performance within and beyond the boundaries of its direct management control, including animal welfare and energy consumption. As an example, Novozymes explores how its technologies and product portfolio can help reduce customers’ products’ environmental impact.
The boundaries of Novozymes’ environmental and social impacts are expanding as a result of new acquisitions and business partnerships, as well as the use and application of its technologies and products in new products and markets. Processes relating to the identification, assessment and management of environmental, social, and health and safety impacts, in the due diligence and post-deal phases of acquisitions, have been improved.
Responsiveness
In our opinion, the environmental and social responsibility data and information in the Annual Report address aspects material to Novozymes’ key corporate stakeholders. In general, reported indicators and targets related to environmental and social performance are linked to relevant policies and management systems.
Responsiveness is generally supported by well-functioning management systems, which include use of internal and external environmental and social audits as well as value-based audits (facilitations). In 2007, Novozymes made important progress in exploring with other stakeholders opportunities for contributing to the realization of the United Nations Millennium Development Goals. Also, Novozymes actively engaged in the global debate on climate change – specifically the debate on use of biofuels, which resulted in the postponement of some projects.
In our opinion, the existing management and reporting systems, as well as internal control systems, support the reliability and accuracy of the environmental and social data and information in the Annual Report.
Commentary
According to the AA1000 Assurance Standard, we are required to include recommendations for improvements in relation to environmental and social responsibility. The recommendations, as well as our statement of independence and competence to undertake this assignment in line with the requirements of the AA1000 Assurance Standard are stated under Supplementary reporting in the online report. Our recommendations do not affect the conclusion stated above.
Gladsaxe, January 24, 2008
PricewaterhouseCoopers |
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Kim Füchsel State Authorized Public Accountant |
Helle Bank Jørgensen State Authorized Public Accountant |
