The UN’s ten universal principles on ESG are contained within four categories:
We set out below the key ESG issues which are the focus of CLINUVEL and the performance measures that reflect the effectiveness of our approach. These measures are qualitative and/or quantitative, depending on the ESG issue.
CLINUVEL recognises the adverse impact of mankind’s activities on the global climate and environment and is supportive of actions that address the causes of these impacts for the benefit of future generations. This concords with the UN definition of sustainability to meet the needs of the present without compromising the ability of future generations to meet their own needs.
There are rising expectations that public companies set targets across a range of environmental criteria and monitor their performance against those targets. Common targets relate to reduced CO2 omissions, energy and water usage and waste. In this regard, it is important to recognise that CLINUVEL outsources the manufacture of its key inputs and products to strategic suppliers and has less than 100 employees working across modest offices worldwide, and a laboratory focussed on molecular research and product formulation. The impact of our direct activities on the environment are relatively modest and we consider the setting of metricated targets on environmental criteria to be more practical for larger companies with a relatively larger direct impact on the environment. We therefore take a practical qualitative approach to consciously seek to minimise CO2 emissions, resource use and waste and to maximise recycling across our activities. It is incumbent on our management team to maintain this approach as we continue to grow and re-assess the need for formal targets from time to time.
The ways in which we perform against our qualitative environmental objectives are reflected in:
CLINUVEL has no adverse impact on UN social objectives and makes a positive contribution through its development and distribution of products for unmet patient and healthcare needs. CLINUVEL’s key focus is on the quality and safety of its products. CLINUVEL works with key suppliers who adhere to global regulatory standards (including GLP and GMP standards) to ensure the quality of its products. The lead compound, SCENESSE® (afamelanotide 16mg), has a positive safety profile based on over 11,000 administrations in clinical trial, special access, compassionate use, and commercial distribution programs over more than one and a half decades. A rigorous pharmacovigilance program is maintained and reported to global regulatory authorities to confirm the real-world experience treating adult EPP patients with SCENESSE®.
CLINUVEL’s research and development program is highly ethical and undertakes the minimum studies necessary to obtain the regulatory approvals required to distribute its treatments. We are committed to the OECD Replacement Reduction and Refinement Principles for non-human studies and ensure all studies undertaken are responsibly designed and conducted by laboratories certified by internationally recognised and respected bodies. We use Ethics Committees for study approval, adhere to OECD Testing Guidelines and the principles of GLP. The focus of past clinical studies and the current clinical studies of the Company’s expanded clinical program is on safety.
The most important social issues to CLINUVEL are labour standards and equality of opportunity to support fairness and enable all CLINUVEL employees to achieve their professional and life objectives.
On labour standards, CLINUVEL supports a safe and flexible workplace and a positive work-life balance in which motivated and committed employees can excel in their professional and personal development. Good working conditions at home and in the office or laboratory, with fair employment terms and conditions, including remuneration and a range of leave benefits, are essential to this objective.
During FY2022 employee benefits were enhanced to provide a greater range of leave options and flexibility with amends to healthcare and pensions benefits in select regions. The Company’s Remote Working Policy also assists work-life balance, whilst active individual training and development plans support professional fulfillment and job satisfaction. Reflecting the safe working environment provided, injuries and time lost from workplace accidents were nil in FY2022.
The effectiveness of this approach to fairness and positive working conditions is reflected in the employee tenure data and growth in new employees achieved in a competitive global market for talented people. The growth in employees has been strong over FY2020-22 to support the growth and expansion strategy of the Group. This has influenced the employee tenure data with an increase in employees with tenure of up to five years. In the last year, however, there was a rise in the proportion of employees with tenure with CLINUVEL of over ten years.
| Measure, Year Ended 30 June | 2022 | 2021 | 2020 |
|---|---|---|---|
| Employee Tenure, % of total employees | |||
| Up to 2 Years | 60 | 56 | 67 |
| +2 and up to 5 Years | 26 | 28 | 14 |
| +5 and up to 10 Years | 3 | 3 | 4 |
| Over 10 years | 11 | 13 | 15 |
| Growth in Employees, % change year on year | 16 | 17 | 41 |
Equality in opportunity is defined to apply to all human beings regardless of gender and gender identification, sexual orientation, race and ethnicity, religion and beliefs, disability, age, and socio-economic status and background. CLINUVEL is proud of its commitment and track record in treating all employees with equality and this extends to its interactions with external stakeholders.
Diversity is a key indicator of an equitable and fair approach to employees. CLINUVEL aims to recruit from as diverse a pool of candidates as possible, provide the opportunity for positive career development, ensure succession planning has a focus on diversity, and adopts and supports flexible work practices to suit the broadest diversity possible. Diversity is monitored by the Board and is a key performance responsibility of the Managing Director.
| Measure, Year Ended 30 June | 2022 | 2021 | 2020 |
|---|---|---|---|
| Gender Diversity % Female / Male of total employees | |||
| Board | 43/57 | 50/50 | 50/50 |
| Top 7 Salaried Employees | 57/43 | 57/43 | 57/43 |
| All Employees | 68/32 | 62/38 | 60/40 |
| Number of Nationalities | 16 | 19 | 15 |
| Employees with more than one language % of total | 51 | 54 | 40 |
| Age Composition % of total employees | |||
| Generation Z (born 1997-2012) | 10 | 8 | 3 |
| Generation Y, Millennials (born 1981-1996) | 59 | 61 | 65 |
| Generation X (born 1965-1980) | 24 | 23 | 22 |
| Baby Boomers ( born 1946-1964) | 7 | 8 | 10 |
CLINUVEL is a leader in its sector in securing gender diversity, exceeding the Australian Securities Exchange (ASX) minimum expectation of females at Board level of 30% (applicable to all listed companies in the ASX300 Index) and having more female than male employees amongst the highest salaried and all employees. The number of females in the top seven salaried employees (excluding the Chief Executive Officer) exceeds the 40% minimum expected by the ASX. Multiple nationalities and linguistic abilities underlie CLINUVEL’s diversity beyond gender. The aged composition of employees further highlights the diversity of the CLINUVEL team across seasoned and younger personnel at various stages of their career. All are committed to develop their skills and work together in a highly collaborative way to achieve the objectives of the Company, noting the ongoing stewardship of the Company is provided by Generation X and Baby Boomers, along with the more experienced of the Millennial generation.
CLINUVEL is committed to maintain the high level of diversity represented in the table above.
The Board of Directors are responsible for the governance of CLINUVEL, and this extends to oversight of ESG issues. The Board has endorsed the Company’s ESG Framework which is underpinned by the Group’s values (detailed on pages 4 and 5 of this report) and incorporated throughout a suite of corporate governance policies. These ensure CLINUVEL operates ethically and responsibly, fairly, and within the law of the jurisdictions in which it operates, consistent with ESG standards. More specifically, the Corporate Governance Protocol and the annual Corporate Governance Statement set out the code of conduct and ethics and other policies to ensure conflicts of interest are avoided and a culture of honesty and integrity is maintained which concords with the expectation of responsible management of ESG issues. Employees are also supported (through the Whistleblower Protection Policy) to report any breaches in the Company’s values, ethics, policies on acceptable conduct and the laws and regulations to which we are committed to adhere.
CLINUVEL expects its suppliers to adhere to ESG standards. This is assessed and reviewed on a regular basis by managers and executives of the Company. Any negative issues are reported to senior management for attention, discussion, and decision on ongoing engagement.
In the past, CLINUVEL’s management has reported ESG issues to the Board for guidance and decision. Based on feedback from proxy advisors, a more formal reporting practice was commenced during FY2022 in which ESG issues are part of management’s regular briefing reports to the Board. For the year ended 30 June 2022, there were no material issues reported to the Board on ESG issues; and more generally, no material breaches of policies on conduct and non-adherence to CLINUVEL’s values and laws, and no protected whistleblower reports.
ESG issues are intrinsically linked to sustainability. CLINUVEL is committed to build a diverse and sustainable pharmaceutical group based on its specialised knowledge of melanocortins and is committed to achieve this concurrently with a sustainable environment, economy, and society. This means CLINUVEL is committed to support balanced ecological, human, and economic health and vitality to meet present needs without compromising the ability of future generations to achieve the right ongoing balance. During the 2023 financial year, CLINUVEL will continue its work in this area and report progress to stakeholders.
CLINUVEL is a responsible corporate citizen. It has a clear and active ESG framework that is aligned to recognised UN tenets and charters on ESG and sustainability. This feature has reiterated CLINUVEL’s approach to the management of ESG issues and provided insights to key performance measures used to govern responsible outcomes, particularly in the social area. More work is planned on policies and metrics to enhance its management of ESG issues in FY2023.