Securing better food for the future Syngenta Sustainable Business Report 2018 Syngenta Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Contents
Overview We play a vital role in the 2018 in numbers 01 02 food chain to safely feed Chief Executive Officer’s Chief Executive statement 02 Officer’s statement the world and take care Our business model Creating value now and for of our planet. Through more than 150 listening the long term 04 sessions around the world with Our offer stakeholders from across the value chain, we now have a We will be the most Innovation with purpose 06 much better understanding of collaborative and trusted Crop Protection 08 what society expects from us Seeds 14 and what sustainable agriculture means to different groups. team in agriculture, The Good Growth Plan providing leading seeds Introduction 18 At a glance 19 and crop protection Make crops more efficient 20 04 08 14 innovations to enhance Rescue more farmland 23 Our business model Crop Protection Seeds Help biodiversity flourish 26 We’re constantly seeking new Market-leading crop protection Developing and producing the prosperity of farmers, Empower smallholders 28 ways to better use resources, products with broad coverage seed for farmers, commercial Help people stay safe 30 deliver value-adding products across extremely diverse growers, retailers and small wherever they are. and services, and create value geographies seed companies Look after every worker 32 for our stakeholders Our operations Resources we use Introduction 36 People 37 What we do Sustainable operations 40 Business integrity 43 What we create Corporate information The value we provide Board of Directors 46 Executive Team 48 Non-financial performance 18 36 52 Non-financial information 50 The Good Growth Plan Our operations Non-financial performance Non-financial performance The Good Growth Plan contributes Securing the long-term viability summary summary 52 to the sustainability of both our own of our business means using The summary presents data on our business and the wider world that resources with ever greater progress in four areas: The Good we serve efficiency in all our operations Growth Plan, People, Sustainable operations and Business integrity
Syngenta’s Sustainable Business Report includes quantitative For further information and qualitative information on policies and actions taken regarding and answers to many our business and sustainability goals. “Questions about Syngenta”, It also serves as our annual Communication on Progress (COP) visit our corporate website: for the United Nations Global Compact. www.syngenta.com % Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance 2018 in numbers 27,732 Europe, Africa Employees4 North and Middle East America $13.5bn Asia Group sales Pacific
Latin 8.3m 99.6% America People trained on safe use5 Suppliers included in sustainability and fair labor programs6
North America $10.4bn 2 Sales $m 3,514 Crop Protection sales1 Employees4 4,120 Research and Development sites 30 Production and Supply sites 30 Latin America Sales2 $m 3,646 Employees4 5,676 9 + Research and Development sites 21 Countries Production and Supply sites 19 Europe, Africa and Middle East $3.0bn Sales2 $m 3,877 Seeds sales2 Employees4,8 11,690 0.32 120 Research and Development sites 44 Recordable injury Research and Production and Supply sites 35 and illness rate7 Development sites Asia Pacific Sales2,9 $m 1,986 Employees4 6,246 104 Research and Development sites 25 Production and Supply sites 20 Production and Supply sites3 1 Including sales to Seeds 6 The seed supply chain represents about 2 Excluding Flowers 98 percent of the suppliers targeted by our 3 Including 4 multi-functional production sites sustainability and fair labor programs 4 Permanent full-time equivalent (FTE) as of 7 Per 200,000 hours, according to US September 30, 2018 OSHA definition 5 Includes smallholders reached 8 Including headquarters (Switzerland) through training reported under 9 Including China ‘Empower smallholders’ 01 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Chief Executive Officer’s statement
Continued innovation Our broad spectrum ADEPIDYN® fungicide 2018 was is now registered for use on more than 80 crops in the United States and – under the brand name MIRAVIS™ – for use on canola, grapes and potatoes in Australia and New a landmark Zealand. Our new generation fungicide AMPEXIO® WG Pepite® was launched in 11 European countries. In weed control, our first post-emergent broad-spectrum year for ™ herbicide, TALINOR , was launched in the US and Australia and controls more than 45 weeds. In France, CALARIS® herbicide is now Syngenta providing fast and effective broadleaf weed control in corn. MINECTO® continued its strong performance in the US, controlling insects in vegetables and specialty crops, and was introduced to growers in Spain and Columbia.
We also continued our leadership and innovation in seed treatment, where FORTENZA™ Duo was introduced to African and Indian growers, helping them with early control of the devastating fall armyworm.
We saw double-digit growth in acres committed to our data-driven AGRIEDGE It was our first full year of operations under the Record Free Cash Flow in 2018 Through more than 150 listening EXCELSIOR® farm management system, ownership of ChemChina, during which we sessions around the world with Sales increased in 2018 by 7 percent to while offers such as AGRICLIME™ – sharing acquired several new businesses, delivered $13.5 billion. We maintained profitability the risk of low rainfall – and HYVIDO® Cashback stakeholders from across the strong financial growth and strengthened our and record free cash flow of $1.76 billion. Yield Guarantee have provided growers with value chain, we now have a position as a thought leader. We continued to Crop Protection sales of $10.4 billion the confidence to invest in new technology. make a substantial contribution to ensuring much better understanding of increased 7 percent compared to 2017, The acquisition of FarmShots™ in the United that farmers can safely feed the world with solid recovery in Latin America and States and Strider® in Brazil further enhances what society expects from us today, while planning to sustainably feed good new product sales of SDHI fungicides our digital capability. and what sustainable agriculture future generations. in North America and Europe. Seeds sales of means to different groups. $3.0 billion were 6 percent higher, reflecting Along with the acquisition of Nidera™ Seeds in stronger performance in Latin America and 2018, we also purchased Abbott & Cobb™, a Eastern Europe. Our Flowers business vegetable seeds company. To ensure the right grew by 7 percent. leadership in our Seeds business, we have brought on a number of new hires and further developed internal talent. We are also opening a major global Seeds office in Chicago in the heart of US corn and soy growing regions.
02 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Chief Executive Officer’s statement continued
Contributing to sustainable agriculture We are demonstrating substantial increases In my remarks last year, I highlighted our in smallholder yields, improving on-farm commitment to working more closely and practices, with productivity across smallholder transparently with governments, NGOs reference farms up by 21.9 percent and society to collectively find the solutions compared to the 2014 baseline. At the same we need. Through more than 150 listening time, we were able to extend the number sessions around the world with stakeholders of smallholders reached through training from across the value chain, we now have a across the world to 6.1 million, bringing the much better understanding of what society cumulative total of people trained in safe use expects from us and what sustainable to 33.8 million, some two thirds more than our agriculture means to different groups. Our aim original 2020 target. has been to have a more direct and inclusive Our people are at the center of all we do conversation to help rebuild the trust between society and science. The sessions have None of this success would be possible helped us better understand our role so we without the dedication and passion of some can continue to build society’s confidence in 28,000 people of Syngenta. We depend on the farming and agricultural innovation sectors. their knowledge, expertise and commitment to bring innovation to farmers, collaborators and The Good Growth Plan: strong progress partners along the value chain. In 2018, we made excellent progress – in We continue to invest in capability some cases exceeding – the 2020 targets set development with the company-wide ‘Pulse down in The Good Growth Plan. Through our Survey’ providing us with excellent feedback commitments we have also contributed on where to focus our efforts in 2019. It is great significantly to the achievement of the United to see that engagement is highest among the Nations Sustainable Development Goals. millennials in our workforce, for it is this group In 2018, the greenhouse gas footprints from that represent the future of our industry. our reference farms showed an average efficiency increase of 8.8 percent compared And the future of our industry is bright. with the 2014 baseline. Across 1,443 reference 2018 has showed us what is possible when farms we have seen a 13 percent improvement we align as one team with one plan. Our work, in productivity since 2014 baseline, well on the in bringing sustainable agriculture solutions to way to the target of 20 percent. millions of farmers around the world, meeting the needs and expectations of society, while Working to actively promote conservation protecting and enhancing the environment, agriculture, we have exceeded the 2020 target matters more than ever. of improving the fertility of 10 million hectares of land on the brink of degradation. We have also exceeded our 2020 biodiversity target by 27 percent.
J. Erik Fyrwald Chief Executive Officer
03 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Our business model
Our strategy is to grow through customer- If we succeed, we will achieve not only growth focused innovation – not just in product for our business but also growth for all – Creating value research and development, but in every creating value that benefits our employees, aspect of our business model. We seek new customers, communities and food chain and better ways to use resources, to develop partners. Our success will be measured and deliver products and services to farmers, through the benefits we bring to agriculture now and for and to create value for our many stakeholders and the environment. But in a sector as – including employees, the communities where challenging as agriculture, success is not a they live and society at large. given. It will require determined execution. We will need to collaborate with many partners the long term All this innovation has one focus: a passion to achieve better outcomes and to earn trust for our customers, the farmers who grow by delivering on our commitments. Syngenta plays a vital role in enabling the food the world’s food. To make our business chain to feed the world safely and take care work, we have to understand their needs and That trust depends not just on what we do: the deliver products and services that they value. “how” matters, too. So transparency, ethics, of our planet. Our ambition is to be the most And to make our business sustainable, we safety and compliance are core to the way collaborative and trusted team in agriculture, have to take the long view: ensuring that we work. In operating our business model, providing leading seeds and crop protection what we do today strengthens Syngenta and we’re determined to live by the values we have the food chain for tomorrow – economically, set ourselves – which are emboldened in the innovations to enhance the prosperity environmentally and socially. paragraphs above. of farmers, wherever they are. That’s why our Good Growth Plan commitments are integral to our business strategy. They put sustainability center stage in the way we do business and align closely with the UN’s Sustainable Development Goals.
See The Good Growth Plan on pages 18–35
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1. Resources we use 2. What we do Financial capital Research and development Production Commercial Supporting activities People and the intellectual Crop protection discovery Production of active ingredients Product management Product registration and stewardship property they create and innovation and intermediate chemicals Marketing and sales Health, safety and environment Advanced seed breeding Formulation, fill and pack Distribution management Chemical, biological, genetic Addressing insect, disease, weed Production of seeds Employee engagement and computational sciences and environmental stress on crops Production of flowers Business integrity and Who we work with upholding human rights Growers Multi-stakeholder dialogue Natural resources Who we work with Who we work with Distributors Research institutions and universities Suppliers Facilities and services Demonstration farms Farmers and suppliers Toll manufacturers Who we work with Processors and the food chain Agricultural extension services Industry associations Local communities Agronomists NGOs Government and regulatory authorities Agricultural extension services Laws and regulations NGOs and IGOs Technology providers Communities
3. What we create 4. The value we provide Products, services Sustainable agriculture innovation Sustainable production Development of our people and & solutions for small- to large-scale farms and supply practices partners along the value chain Crop protection Seeds Reliable availability and affordability Economic value shared Promotion of decent work Herbicides Seeds of safe, nutritious food and feed with employees, suppliers, and good governance Insecticides Traits governments and communities Fungicides Efficient, effective fiber and fuel Stimulating research, Seed treatment Grower Tools for grower empowerment Rural development and collective sharing data and knowledge Biologicals programs and stronger food systems well-being of communities Crop enhancement Digital agriculture
05 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Our offer Innovation with purpose Society’s expectations around farming technology do not stand still; neither does the technology itself. In recent years, there has been a shift in focus from feeding a growing world population to increasing debates around environmentally sustainable diets and nutrition — from ‘enough food’ to ‘good food’.
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For many years, we have been advancing the We strive to build constructive and open they need and meet their specifications in technologies for sustainable crop protection relationships with governments, regulators, areas such as traceability and sustainability. practice. Data science and precision agriculture and NGOs. And we continue to establish In Italy, for example, we work with pasta continue to reduce the quantities of chemicals strategic partnerships and alliances with We are committed to driving needed for effective control, and new organizations such as the World Business manufacturers including De Matteis on the biocontrols are adding non-chemical Council for Sustainable Development, Grano Armando project to establish crop ever more sustainable agricultural solutions to the farmer’s toolbox. the International Rice Research Institute, protection protocols that enable growers to practices and to working with The Nature Conservancy, and many produce higher yields of top-quality durum others across society and the We’re proud of the progress we’re making, wheat and secure them higher and more reliable scientific and academic institutions value chain to deliver better while recognizing that there’s still a long way to worldwide. These collaborations and incomes. We have now also bred a new wheat go. We’re eager to have a better conversation partnerships have always been an variety with tailored agronomy specifically for food for the future. about what sustainable agriculture really this project. In Argentina, we are working with important part of the way we work. Alexandra Brand means – with farmers, channel partners, soybean and peanut growers together with a Chief Sustainability Officer food companies, food retailers, NGOs, Sustainability matters increasingly to local food processor – AGD – on multifunctional academics and governments. Not only to value chain companies because of the landscapes that enhance biodiversity and explain our views, but also to equally listen commitments they are making to consumers. pollination. One key goal is to satisfy the and understand the expectations of all our We prioritize sustainability issues at every developing sustainability requirements of stakeholders. We need to build greater stage of our work, from the lab to the their European export customers. consensus through wider discussion with field. Our research and development stakeholders about how we can work together processes assess the impacts of candidate Sustainable agriculture matters increasingly to create truly sustainable solutions in ways compounds and techniques from the earliest to governments, too. This is encouraging that reinforce society’s confidence in farming possible stages. And we are integrating them to work more closely with us, and and agricultural innovation. sustainability into our commercial offer to nowhere more so than in China, where the farmers, promoting the benefits of using our government is driving rapid modernization of products to grow crops with lower impacts. agriculture alongside a transition to a much Working more closely with downstream more sustainable economy. Along with partners in the value chain means we can our stewardship programs, we support integrate innovative products and agronomic sustainable manufacturing and production services that enable growers to deliver what of crop protection active ingredients and products in China. We do this through our long-term commitment to rigorous supplier selection, continuous supplier management and applying our world-class manufacturing standards.
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As well as protecting plants from insects and diseases, we provide crop enhancement products Crop that help them tolerate environmental stresses such as heat, cold and drought. We also offer products that boost crops’ nutrient uptake – increasing yields while improving sustainability by using fertilizers Protection more efficiently. Syngenta is a world market leader in crop While our principal customers are farmers and protection products, with broad coverage of channel partners, our Syngenta Professional Solutions an extremely diverse market. We develop and business adapts our agricultural technologies to produce herbicides, insecticides, fungicides serve professionals in turf, tree and landscape care, and seed treatments that promote strong residential and commercial pest management, and healthy plant growth. disease vector control, commercial flower production and consumer garden care.
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Did you know? Strengthening the farmers’ toolbox: innovations in 2018 In recent years, we’ve been working to accelerate the pace of our innovation, as we 50-90% continue to design and develop breakthrough ‘blockbuster’ molecules for the future, along with smaller active ingredients that meet specific loss needs within our strategic markets. In 2018, we filed a total of 110 patent applications (2017: 111) Without fungicides, yields of most fruits for crop protection innovations. and vegetables would fall by 50–90 percent Our research and development work aims Source: CropLife Foundation, 2005 to give farmers a broader, better and more flexible toolbox. Following are some key examples from 2018.
Disease control We continued to bring new products to market based on our broad-spectrum ADEPIDYN® fungicide. It delivers a longer duration of control, allowing growers to better adapt application interval to disease pressure, As expectations evolve, We recognize our responsibility to develop resulting in less application per season. sustainability is critical products that are safe and sustainable, and In 2018, introductions included MIRAVIS™ Farmers must meet the needs and expectations to steward them carefully. Some 30 percent fungicide for canola, grapes and potatoes in of food processors and retailers, consumers, of our investment in developing each new Australia and also for potatoes and grapes in society and our planet. As these needs and active ingredient is spent on product safety. New Zealand. ADEPIDYN® products are now expectations become more complex, so do We also invest substantially in training farm registered for use on over 80 key crops in the the challenges for farmers. Whether they are workers to use our products safely: in 2013, US, where we also launched POSTERITY ™ smallholders or big corporations, they must we committed to train 20 million by 2020. fungicide for use on turf. reconcile the imperatives of running a business In fact, we’ve already beaten that target AMPEXIO® WG PEPITE®, our new-generation with their societal responsibilities as stewards by 13.8 million. fungicide for downy mildew in grapes, won of the land. See “Help people stay safe” the 2018 Agrow Award for Best Formulation At Syngenta, we apply science and on pages 30–31 Innovation. Launched in 11 European countries technology to help them meet those complex in 2018, it has a favorable environmental needs consistently, safely and sustainably. profile and low application rates. Our products enable farmers to deliver food We diligently comply with current regulatory that is abundant, nutritious and affordable systems and fully support realistic, science- – without using more land or other inputs. based regulation for crop protection products. For example, we actively argue the case for transnational consistency of standards, such as maximum residue levels (MRLs), so that crops which meet regulatory requirements where they are grown are not barred from sale elsewhere.
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ORONDIS®, a new mode of action Insect control FORTENZA™ Duo insecticide made a timely oxathiapiprolin fungicide for citrus fruits and Insecticide launches in 2018 included: entry into the African and Indian markets: $100m vegetables, launched in Guatemala and PROCLAIM® for lepidoptera and ENGEO® this best-in-class corn seed treatment is Mexico in 2018. We continue to extend the second-generation neonicotinoid for foliar highly effective against fall armyworm, a ™ ® use of ELATUS based on SOLATENOL and soil pests in Brazil; and FORCE® 6.5G for devastating pest that has spread across Africa fungicide across a growing range of crops rootworm and other soil-borne pests in corn in the past two years and arrived in India in sales and countries. 2018. VIBRANCE™ Cinco – combining five in the US, which produces less dust than European sales of ELATUS™ fungicide for powerful modes of action to provide the most Weed control older technology and has an excellent cereals passed $100 million in 2018, following environmental profile. consistent and comprehensive seed-applied launch in 2017 TALINOR™, our first post-emergent broad- disease protection available – received US spectrum broadleaf weed solution in cereals, MINECTO®, our new insecticide family for registration approval for use on corn. reached the market in the US and Australia. hard-to-control sucking pests in vegetable and It controls more than 45 weeds, even specialty crops, has so far been introduced Biocontrols where resistance is a problem. AVOXA®, for tree nuts in the US, potatoes in Columbia, Soybean cyst nematodes cause growers a post-emergent cereal herbicide for grass and tomatoes and peppers in Spain. With annual losses of around $1.5 billion in the US control that also supports active resistance tailored formulation mixture partners, its alone. CLARIVA™, the only available biological management, launched in Germany. And multi-pest spectrum and long-lasting control seed treatment that controls these nematodes CALARIS® herbicide now provides French allows growers to reduce the total number on contact, was launched in Brazil in 2018. growers with fast and effective control of of applications; the new mode of action Because soybean cyst nematode damage is broad-leaved weeds and grasses in corn. allows growers to better manage resistant often more severe in stress conditions, we are insect species. also offering CLARIVA™ to Brazilian growers in Our Integrated Weed Management (IWM) combination with our EPIVIO™ Vigor biological approach combines chemistry and agricultural Seed treatment seed treatment for abiotic stress management. practices to optimize yield by improving Syngenta Seedcare announced the overall weed control in a sustainable way. European debut of PLENARIS®, a powerful This integrated approach helps to delay the new fungicide for downy mildew control in onset of weed resistance, reduces the buildup sunflowers. It delivers unprecedented value of weed seeds in the soil, while also improving for the grower as it uses a significantly lower soil health and structure, resulting in reduced amount of active ingredient per hectare. erosion and improved water quality.
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Did you know? Other 2018 introductions included Inventing chemistry for the future Our newly-formed Digital Agriculture Solutions ®2 BOTRISTOP , a plant-extract offer Our work on developing new chemistries is group is collaborating with research and ™ against botrytis, in Chile; and QUANTIS , gaining unprecedented precision. Scientific development, Syngenta Ventures, and our a nutrient-enriched by-product of sugarcane insights generated in the field and throughout commercial, production and supply functions 821m and yeast fermentation that protects yields and our R&D cycle inform precise product to create innovative new tools for growers. quality in corn and sunflowers by helping them development. Increasingly, we can model And, in 2018, we made two further significant to resist heat and drought stresses, in India, and design molecules to address specific tech acquisitions: Paraguay and Romania. hungry challenges such as resistance management. UU Strider®3, a Brazilian company providing Grower Program Offers For some years, we have made sustainability operational management solutions for Around the world, 821 million1 people are criteria a key factor in the earliest stages of Grower Program Offers combine our farms, from monitoring machinery and pest currently going hungry. One way to reduce selecting and developing candidate molecules; control to satellite imaging of crops. It will hunger is to increase food productivity. world-class technology with protocols that now we are also exploring “predictive help us to bring growers new ways Crop protection products help farmers do that. help the grower to maximize the product, toxicology” techniques to design molecules together with services that growers need. to manage on-farm information. Source (1): Food and Agriculture Organization of the proactively for safety. Syngenta Sustainable Solutions and its ™ United Nations (FAO), 2018 UU FarmShots , a US company that processes ® data-driven AGRIEDGE EXCELSIOR farm We have a portfolio of around 70 active high-resolution field images from satellites management system, for example, have been ingredients. We regularly revisit our portfolio to assess plant health, helping farmers, operating successfully for over a decade. of active ingredients to ensure we provide agronomists and retailers to spot field And where once these were niche activities, the best solutions to farmers. issues such as diseases, weeds and other today they’re mainstream. Holistic offers, pests. It will accelerate our development ® Crop protection beyond chemistry: the such as AGRIEDGE EXCELSIOR , Grape of farm management and crop decision- ™ digital revolution and new technologies Quality Contract, POTATOPACK and making tools. AGRICLIME™ are expanding fast and earning Increasingly, we’re an agricultural technology exceptionally high customer loyalty rates. business. We bring together chemistry, In Europe, the HYVIDO® Cashback Yield biology, digital technologies, new monitoring Guarantee adds insurance that guarantees and application techniques, biologicals – and return on investment for hybrid barley growers. even new breeding techniques – to create In Australia, AGRICLIME™ adds a financial novel solutions. guarantee against the occurrence of pre-agreed heat or drought conditions.
2 Registered trademark of Inversiones Santa Inés Limitada 3 Registered trademark of Strider Software S.A. 11 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Crop Protection continued
Did you know? Digital technology is giving us new ways to For many years, we have been complementing turn data into meaningful information – and our chemistry portfolio with biocontrol to put it into customers’ hands. For example, products to add modes of action that enhance 32m daily access to mobile technology plays resistance management. Demand growth for 20m an important role in the modernization of biocontrols is now outpacing conventional agriculture in China, where it enables us to products, and by 2030 they could represent reach extensive retailer and grower networks up to 10 percent of the global crop people across the country. protection market. In particular, there are Our ACTELLIC® 300CS mosquito control hectares great opportunities for limiting conventional Our Retailer Hub app has the potential to product protected an estimated 32 million In 2018, farmers used drones to treat an chemistry residues on fruit and vegetables people in malaria endemic countries in 2018 estimated 20 million hectares in China alone service over 500,000 retailers, providing by using chemical treatments in early growth agronomy information, training and support. stages and finishing with biocontrols in the Source: National Agro-tech Extension and Service Center And our Grower Club app brings growers later stages. (NATESC), China, 2018 agronomic support as well as advice on our crop protection products and seeds, weather Over the past three years, our “BioAlliance” forecasts and pricing information; it also with sustainable bioscience company, DSM, connects users with retailers in our network. has been establishing a powerful and unique biocontrols discovery platform. This continues Precision agriculture is allowing farmers to to deliver a diversity of interesting product use crop protection with unprecedented candidates, and we expect to bring the efficiency and economy. Advances in sensor first products from this alliance to market technology, satellite and drone imaging, around 2024. and data science provide increasingly sophisticated information to help growers Meanwhile, we are preparing to launch manage their crops sustainably, from planting TAEGRO ®1, our new microbial biofungicide through to harvest. Combined with precision against diseases such as powdery mildew application technology and advanced product and botrytis, across the EU, Mexico and formulations, this data revolution will help elsewhere in 2019. growers to maximize benefits and minimize impacts from farm inputs such as fertilizer and Investments and partnerships crop protection products. Partnerships and collaborations enable us to access existing technologies or jointly develop Better application technologies are further entirely new classes of chemistry. For instance, reducing the volume of product required per we are working with the Innovative Vector hectare and improving control of drift and Control Consortium (IVCC) and the Bill and overspray. Drone spraying is now feasible Melinda Gates Foundation on insecticides to even for smallholders, and in 2018 farmers help eradicate malaria by 2040. One result used drones to treat an estimated 20 million is a promising new active ingredient with a hectares in China alone. Where regulations novel mode of action to address resistance limit drone use, autonomous row-walking in malaria vector control. This entered early robots could deliver similar efficiencies. development in 2018. Our work with the IVCC has already produced the highly successful long-lasting mosquito control product ACTELLIC® 300CS.
1 Registered trademark of Novozymes A/S 12 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Crop Protection continued
In-licensing also helps us fill gaps in our Other investments include stakes in innovative coverage. In 2018, we announced a global start-up companies through Syngenta seed treatment licensing agreement for Ventures, our corporate venture capital group: Happy 90th Picarbutrazox, a new fungicide from a U chemical class discovered by Nippon Soda. U BioPhero, which explores biological ways Its novel mode of action will strengthen our to make pheromones as lower-cost, Seedcare capability in corn, soybeans, canola, sustainable insect controls b rthday oilseed rape, cereals and other crops. ™1 UU AgBiome , which provides biological Our largest crop protection R&D and product support site, Our research center at Jealott’s Hill celebrated controls for insects and plant diseases Jealott’s Hill International Research Centre in the UK, celebrated its 90th birthday in 2018. It employs over 800 people its 90th birthday, illustrating our long-term UU Sound Agriculture™2, which develops new commitment to scientific excellence in the UK. products to help plants perform better We constantly invest in new facilities and under stressed conditions. resources to maintain our pace and quality of innovation. In 2018, we opened our 14th Seedcare Institute in Wagga Wagga, Australia, to support our Seedcare customers in Southeast Asia. We also committed to capital investments in increasing production capacity and efficiency.
1 Trademark of AgBiome, Inc. 2 Trademark of Sound Agriculture Company
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We offer a broad portfolio of crops and have Seeds particular strength in corn, soybean, sunflower, cereals and vegetables. Syngenta is one of the world’s largest developers and producers of seed for Syngenta Flowers, one of the few global players, is a farmers, commercial growers, retailers market leader in mass-market and value-added plants, and small seed companies. ranking in the top two in most key market segments.
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Innovating to meet market needs We develop products and services that enable Now ENOGEN® corn is also demonstrating The global seed market was estimated at growers to be more productive, to secure major benefits as feed for dairy or beef cattle, 75% around $40 billion in 2018, with 3 percent their livelihoods despite relentless pressure on due to its high digestibility. A 2018 study by forecast annual growth during the next five commodity prices, to manage risks such as two US universities shows that it provides an 75 percent of Brussels sprouts years. Over half its value comes from corn and drought and disease, and to grow crops more average feed efficiency uplift of 5 percent, with worldwide are Syngenta varieties soybean, and over half of sales are made in sustainably – using less arable land, less water improved silage quality and reduced spoilage. and fewer inputs. To do this, we strive to know Brazil, China and North America. Growth over Our AGRISURE DURACADE® corn, offering the next few years is expected to be driven and understand not only growers but also the customers they serve. multiple modes of action to resist 16 kinds by Brazil, China and India. of yield-limiting insects, has been a major Every seed is a package of genetic material Delivering what customers need success in North America, with approval for with the potential to deliver an extraordinary We have a strong pipeline and ongoing export to 15 countries including Brazil, China range of benefits and value: nutrition for people programs in plant breeding and biotech and Australia. and livestock, aesthetic pleasure, energy, and innovation to help farmers meet the In 2018, it cleared the first hurdle towards income and prosperity for farmers. By applying increasingly complex needs of their customers. import approval in the EU, following a science, our Seeds business aims to tailor this For example, we’re providing corn growers ‘positive scientific opinion’ from the material as precisely as possible to meet the European Food Safety Authority. increasingly complex needs and challenges of with the technology they need to serve the our customers’ markets, regions and growing growing demand for ethanol. In 2018, we We’re also supporting vegetable growers to ® conditions. We do this through accelerated further expanded our ENOGEN corn offering meet the needs of their entire value chain. breeding and product development and by with seven new hybrids. Already a game- In vegetables, we launched around 170 new ® providing expert agronomic advice. changer in the biofuel market, ENOGEN varieties in 2018 across all crops to meet the grain makes ethanol production more efficient, needs of growers, processors and retailers. earning premium prices for growers and Highlights included: a red sweet pepper helping to produce clean fuel closer to the with outstanding yield and quality; an eye- point where it’s used. catching black tomato with high anti-oxidant and vitamin content; a high-yielding corn especially suited to sweet corn processors’ requirements; an attractive golden seedless watermelon that stays crisp when cut; and a new spinach variety for European and US baby leaf markets.
15 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Seeds continued
Did you know? Strategic acquisitions and Digital technologies are transforming In addition to these acquisitions, we have collaborations to meet market needs agriculture, and we are developing a growing entered into strategic partnerships and In 2018, we made several acquisitions portfolio of digital solutions and capabilities. licensing agreements to expand the choice that enhance our ability to give customers We made two important acquisitions in 2018: we can offer growers, while strengthening ™ 37% less the products, innovation, advice and FarmShots in the US, an innovator in high- our germplasm pool. resolution satellite imagery; and Strider®1 in services they need to run successful, We also hold minority positions in a sustainable businesses. Brazil, a digital farm management company. Both of these technologies have important growing number of digital start-ups pesticide The acquisition of Nidera™ Seeds nearly roles to play in helping farmers to manage risk, through Syngenta Ventures. doubled the size of our field crop Seeds select traits and germplasm that suit predicted Investing for growth in our key markets business in Latin America. Nidera™ is a major conditions in the coming season, and deploy In 2018, we announced a joint venture with force in soybean with strong offers in corn and assets effectively. use Yuan Longping High-Tech Agriculture to sunflower. Its products, germplasm pool and On average, biotech crop adoption cuts research and development complement ours, We expanded our Flowers offering with the develop and sell new corn varieties, both with ™ pesticide use by 37 percent, while raising yields enabling us to bring more choice, innovation acquisition of Floranova , an established and without biotech traits. Longping is the by 22 percent and farm profits by 68 percent and value to Latin American growers. flower and home garden vegetable seeds largest seeds company in China, the world’s second-largest corn market. Source: Klümper, W. and Qaim, M.; 2014 breeder with a broad portfolio and a strong In the US, we acquired Abbott & Cobb™, a international presence in over 50 countries. breeder, producer, and marketer of vegetable The US is our biggest market. In 2018, we seeds. The company has particular strength in announced plans for a major global and North sweet corn, one of our core crops globally. America Seeds office in Chicago, at the heart of the US Corn Belt which grows over 50 percent of US corn and soybean.
1 Registered trademark of Strider Software S.A. 16 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Seeds continued
The move brings us closer to many US corn Using new technologies, we have reduced the We believe this represents a missed opportunity Did you know? and soybean customers, gives us access to time it takes to pair the best traits with the best for the EU. As other parts of the world move Chicago’s world-class talent pool for digital genetics, so we can bring new products to ahead with innovations that enable breeders and tech innovation and provides excellent market faster than ever, and we are increasing and farmers to do more with less water, transportation links connecting us more investment in breeding and hybridization. As a fertilizer and pesticides, Europe’s breeders and 39% closely with other important markets, such result, our output of new corn hybrids in 2018 farmers will miss out – with significant negative as China, Brazil and Eastern Europe. was 50 percent higher than in recent years. economic and environmental consequences. We also began work on a US$30 million trait We’ve been active in genome editing for over Our global lead genome-editing and biotech less conversion accelerator at our Idaho R&D and a decade, and in 2017 we licensed CRISPR site is in Beijing. Farming is crucial to China’s seed production facility. Most of our North Cas9 and Cpf1 genome-editing technology modernization, and its current five-year plan American corn trait conversion work will take for agricultural applications. We are now aims to achieve basic self-sufficiency in cereal place there, allowing us to bring new traits to applying the technology to accelerate the rate grains and absolute food security. Biotech is land market faster. of innovation in crops including corn, wheat, one of the most promising paths to these Compared to 30 years ago, tomatoes, rice and sunflowers. However, objectives, and the plan envisages a significant a ton of corn can be grown Technological innovation is at the heart of commercialization of our genome-edited contribution from genetically modified crops. using 39 percent less land China’s agricultural modernization, and we are portfolio will depend on how regulators view Syngenta has an important role to play to Source: US Department of Agriculture (USDA), 2018 investing in further strengthening our Beijing genome-editing technologies; this varies support Chinese agricultural modernization Innovation Center, which is driving important around the world. through partnerships with key stakeholders collaborations with Chinese institutes. and by bringing Chinese growers the benefits Unlike genetically modified organisms of biotechnology. Applying transformative (GMOs), most forms of gene-editing do not technologies for the future involve inserting foreign DNA. Often, they are We believe we’re tackling one of the biggest While plant breeding has been going on for simply a more rapid and precise process for challenges humanity faces: to safely feed centuries, it has changed radically in the past achieving outcomes essentially the same as the world and look after the planet. That’s few years. Traditional trial-and-error processes those produced by conventional breeding. not something we can do on our own – we are being supplanted by collaboration We believe agricultural products should be need to engage with the best minds we between breeders and data analytics judged by their characteristics, not the process can find. So we are working with leaders in experts – integrating mathematics, genetics, used to produce them, and that new varieties many fields and disciplines, including data breeding, physiology and agronomy to select that do not contain foreign DNA should fall analytics, software and the supply chain, genetics that enhance crop performance. outside the scope of GMO legislation. We are and sharing expertise and data with them. Plant breeding is increasingly design-driven: committed to openly demonstrating the safety We believe the result of this worldwide effort using quality data and advanced analytics and efficacy of products resulting from plant will be a continuing flow of new digital tools, through each stage of the R&D process, we breeding innovations such as gene editing, services and products to help the world’s can understand challenges better, determine and we periodically publish data to engage growers rise to the challenge – successfully optimum solutions and create products to with stakeholders in open dialogue. and sustainably. match those specifications. We can also use mathematical modeling to determine We will wait to see how the regulatory how products are likely to perform in specific landscape for gene-edited plant products environmental conditions and to place unfolds in China, Latin America and the US. the right seeds for specific fields. But a 2018 ruling by the European Court of Justice means that most plants developed with these methods will be subject to the EU’s regular GMO legislation, which may entail prohibitive costs and political uncertainty over final market approval.
17 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance The Good Growth Plan
The Good Growth Plan is a core element of our strategies for both our Crop Protection and Seeds businesses to ensure their success and long-term viability. It defines six commitments in areas where improvement is essential to secure the future of agriculture and our planet’s ecosystems. Each commitment sets hard, stretch targets to be achieved by 2020. We report our progress against these KPIs each year and provide additional progress information online at www.data.syngenta.com.
The Good Growth Plan’s principles and priorities are deeply embedded in the way we do business. We are gathering unprecedented agricultural data and insight from our reference farms, which we are sharing with partners, academics, NGOs and public institutions worldwide. The lessons we learn are enabling us to enhance our commercial offer, delivering real and measurable benefits to farmers, rural communities and the environment.
In these ways, the Plan contributes to the sustainability both of our own business, and of the wider world that we serve. So it’s appropriate to view our sustainability development not only in business terms, but also in relation to the UN’s 17 Sustainable Development Goals (SDGs).
In the UN’s words, achieving these goals “requires the partnership of governments, private sector, civil society and citizens alike to make sure we leave a better planet for future generations”1. We believe that Syngenta is actively contributing to many of the SDGs, and we recognize a responsibility to maintain a culture of continuous improvement against them. In the following sections – on The Good Growth Plan and our own operations – we highlight the relevant SDGs alongside our report on the progress we are making.
1 United Nations Development Programme
18 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance
Our six commitments help farmers meet the challenge of feeding a fast-growing world population sustainably.
Make crops Rescue Help biodiversity Empower Help people Look after more efficient more farmland flourish smallholders stay safe every worker
2020 target Increase the average Improve the fertility of Enhance biodiversity Reach 20 million Train 20 million farm Strive for fair labor productivity of the world’s 10 million hectares of on 5 million hectares smallholders and workers on labor conditions throughout major crops by 20 percent farmland on the brink of farmland enable them to safety, especially in our entire supply without using more land, of degradation increase productivity developing countries chain network water or inputs by 50 percent
2018 progress and key achievements 13.0% 10.8m 6.4m 21.9% 19.5m 33.8m 99.6% Land productivity Hectares of benefited Hectares of benefited Smallholder Smallholders People trained Suppliers included in increase1 farmland2 farmland2 land reached through on safe use5 sustainability and productivity training and fair labor programs6 increase3 sales4 We’re still raising reference We’ve already benefited The experience and We’re demonstrating We’re reaching We’re on track to reach our farm yields ahead of their an area about the size of evidence base we’re substantial increases in unprecedented numbers 100 percent target – and benchmarks and taking a lead in Guatemala – and we’re building demonstrates that smallholder yields and and finding new ways to be first in our industry the digital revolution that’s set building momentum biodiversity investment makes working with partners for to help people use our with global Fair Labor to transform agriculture in with the help of a wide business sense better on-farm practices products safely Association accreditation the coming years range of partners
Read more on Read more on Read more on Read more on Read more on Read more on pages 20–22 pages 23–25 pages 26–27 pages 28–29 pages 30–31 pages 32–35
1 On reference farms compared to baseline 2014 4 Differences in totals may occur due to rounding 6 The seed supply chain represents about 98 percent of the suppliers targeted 2 Cumulative since baseline 2014. Differences in totals may occur due to rounding 5 Cumulative since baseline 2014. Differences in totals may occur due to rounding. by our sustainability and fair labor programs 3 On smallholder reference farms compared to 2014 baseline Includes smallholders reached through training reported under ‘Empower smallholders’
Additional progress information online at www.data.syngenta.com
19 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance
Increase the average productivity of the world’s major crops by 20 percent without using more Make crops land, water or inputs We’re still raising reference farm yields ahead of more efficient their benchmarks and taking a lead in the digital revolution that’s set to transform agriculture in the coming years UN Sustainable Development Goals 2, 12, 17
Did you know? Progress and key achievements The world needs a step-change in crop Reference farms continue to outperform productivity to ensure sustainable food Globally, a further rise in yields on our reference UUFurther productivity increase security. We are targeting a 20 percent farms took the increase since the 2014 baseline on reference farms – while increase across the world’s most important to 13.0 percent. This represented continuing crops in partnership with growers who use 10x benchmark farms underperform outperformance against the benchmark farms, our products and agronomic advice. We are where the uplift since 2014 reduced slightly UUContinued to extend sustainability devoting particular effort to smallholders, to 7.0 percent. partnerships with growers, food who have the greatest potential to more increase productivity. chain companies and governments an t ty Today, farmers feed at least 10 times more people n ea e using the same amount of land as 100 years ago UUSponsored first US Sustainable See “Empower smallholders” on pages 28–29 Source: International Seed Federation, 2018 Agronomy Conference
To test and measure what’s possible, 1,443 reference farmers are working with our field experts to share know-how and trial new solutions for 20 crops in 39 countries. O refere e f r o re o e e Another 2,316 benchmark farms, many also using Syngenta products, deepen our Farm network understanding of what drives productivity 2018 2017 2016 and efficiency, and help us track progress No. of reference farms 1,443 1,459 1,039 over time. No. of benchmark farms 2,316 2,630 2,694
20 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Make crops more efficient continued
Within this good overall result for the reference We advise reference farms in the safe and farms, there was significant variation among efficient use of Syngenta products according Case study individual countries and crops. A good to optimized protocols: the right product at year for China included particularly strong the right time in the right amount. In 2018, gains for potato growers adopting seed reference farms’ pesticide field application Sustainable Solutions: adding treatment and locally-bred disease-resistant efficiency increased to a total of 24.7 percent varieties. By contrast, in LATAM, Brazilian (2017: 14.2 percent), compared to value for the value chain and Guatemalan coffee growers experienced 2014 baseline. weather challenges – mainly drought – which Responding to consumer demand, Farmers in the program are able to assess reduced crop yields, while maize growers were In 2017, we began reporting greenhouse food retailers take increasing account their farm’s environmental results against unable to match the record yields achieved gas (GHG) footprints from our farm network. of sustainability criteria in their purchasing anonymized community benchmarks. in the previous year’s exceptionally favorable This data is increasingly important to the food decisions. Syngenta Sustainable Solutions Covering efficiency indicators such as land-, weather conditions. industry’s efforts to better understand the works directly with growers and partners in water- and nitrogen-use, as well as soil sustainability of its supply chains. In 2018, the US food value chain, helping farmers conservation and GHG emissions, this Deepening our understanding our reference farms showed an average collect and analyze data to make more data demonstrates sustainability metrics of farm productivity 8.8 percent in GHG emission efficiency sustainable input decisions. to value chain customers. Our reference and benchmark farm networks increase compared with the 2014 baseline. remained little changed in 2018. But we Comparing performance at crop level, averaged continue to develop and refine our systems and over the five years of monitoring, 69 percent processes for collecting and analyzing their of reference farms have outperformed the data. The digital tools that we are now bringing benchmark farms. to market are creating opportunities to further improve the quality of the data we collect, and, eventually, may greatly increase the number of farms we monitor.
This direction supports an increasingly evidence-based approach, in which we use technologies such as artificial intelligence to mine data for insights that improve our product development and commercial offers, help growers connect better with the value chain, and bring demonstrable, measurable and documented benefits to society and the environment.
21 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance Make crops more efficient continued +20% yield improvement Yield improvement achieved with potato growers in Dingxi, northwest China
Applying what we learn Current programs include using data collected In 2018, we sponsored North America’s first ® Already, our farm data is helping to shape through AGRIEDGE EXCELSIOR to test Sustainable Agronomy Conference, organized a better future. By applying what we learn, we strategies for managing weed resistance more by the American Society of Agronomy, and help growers and the value chain in new ways. effectively. We are also working with farmers, focused on how to move sustainable agriculture food companies and universities on feeding from the research field to the commercial field. The development of our NUCOFFEE® Sustentia cattle with ENOGEN® corn for more sustainable project in Brazil demonstrates the evolving meat and milk production. One study has Governments at local, national and regional benefits for growers and value chain partners. confirmed a 5 percent feed efficiency gain level are increasingly engaging our insights and When we launched it in 2006, with UTZ as our with ENOGEN®, and others are appraising expertise through partnerships to support their value chain certification partner, the project its potential to cut GHG emissions. own agendas and goals. In China, for example, was focused on crop quality. Later, we were we are working with a growing number of able to help participating farmers improve their Sharing what we learn agencies on projects that support government productivity and efficient use of inputs such Syngenta is at the forefront of using and sharing sustainability and agricultural modernization as crop protection and nutrients. Now we’re data to help growers make better decisions that agendas. Examples include partnering with working with them to better understand the lead to significant productivity and efficiency the Dingxi Agricultural Bureau and local drivers of sustainability improvements such improvements. As a result, we are also well government to enhance the productivity as GHG reduction. As we collect more data placed to give food chain companies and of potato and other vegetable farms in the through The Good Growth Plan – and integrate governments insight into how best to support northwest of the country. We have trained more it with other inputs such as weather data – we more sustainable agriculture. than 500 farm workers, introduced sunflowers, are seeing a step change in the spectrum of vegetables and herbs as commercially-valuable insights and benefits that we bring to growers We publish detailed Good Growth Plan cover crops, and achieved yield uplifts of and the value chain. progress data on our open data website at around 20 percent for potatoes and www.data.syngenta.com. By visualizing and 14 percent for cabbages. In North America, Syngenta Sustainable offering data in a wider range of formats, we Solutions has been helping customers for a aim to increase accessibility and engage others decade – not only to make their farms more with what we are doing. We continue to work productive and sustainable, but also to engage with the Open Data Institute to ensure we share effectively with the value chain by documenting data in ways that can be used effectively by and supporting good environmental practice those who need it for their own research. (see case study on page 21).
22 Sustainable Business Report 2018 Syngenta Overview Our business model Our offer The Good Growth Plan Our operations Corporate information Non-financial performance
Rescue more Progress and key achievements Today, over 50 percent of farmland is affected In the fifth year of our soil health programs, farmland by soil degradation. We’re working to promote we surpassed the target that we committed UU2020 target exceeded with practices that help farmers maintain healthy to reach by 2020. We aimed to improve Improve the fertility of 10 million benefited hectares up by 7 percent, soil, protect it from wind and rain erosion, 10 million hectares – an area about the size hectares of farmland on the as digital technologies support and increase soil fertility. The solutions we of Guatemala. With 197 projects implemented brink of degradation offer also help them to reduce their carbon in 41 countries, we are already benefiting continuing rapid scale-up footprints and adapt to climate change. 10.8 million hectares. We’ve already benefited an area UUStrong progress in demonstrating about the size of Guatemala – and We actively promote conservation agriculture This success has been driven by three key benefits to value chain based on minimum soil disturbance, crop factors: integration of conservation practices we’re building momentum with the UUNew commitment to improve rotation and permanent ground cover. It is a into our commercial offer; digital solutions; help of a wide range of partners central element in climate-smart agriculture, and partnerships with governments and the 2 million hectares in China under helping to reduce emissions, prevent land value chain. UN Sustainable Race to Zero initiative Development Goals 2, 13, 15, 17 degradation, improve food security, increase farm and community resilience, and deliver Integrating soil health into our sales offer better crops to the value chain. As well Integrating soil conservation practices into as working with farmers, we are raising our crop protocols and training is helping awareness of soil conservation among value to differentiate our commercial offer and chain partners, government institutions also benefits our own seed multiplication and academics. operations. Examples include INTEGRARE™, our high-yield soybean solution combining Hectares of benefited seeds, seed treatment, crop protection and farmland1 services such as water- and soil-nutrition management. Since its launch in 2015, INTEGRARE™ acreage in Brazil passed 2018 10.8 1.1 million hectares.