Israel Aerospace Industries (IAI) published its Corporate Sustainability Report for 2016. The report, which is published for the second year, focuses on the company’s 21 material issues, and describing the sustainability developments of the past year. In the course of 2016, IAI has solidified its sustainability vision by updating its sustainability policy, endorsed by the Company’s senior management and the board of directors. The 2016 report presents, for the first time, five company sustainability goals, including electricity consumption, environmental management in the supply chain, safety and occupational health performance among employees and contractors, diversified employment and women advancement. In addition, the Company details a roadmap by which it will decide on its sustainability goals for 2022.The sustainability report complies with GRI-G4 guidelines, as set by the international reporting of the Global Reporting Initiative (GRI). This is the first year in which the reporting process also includes an external limited assurance process, performed by BDO.
Joseph Weiss, IAI’s President and CEO said, “Based on the deep understanding that sustainable management and development are critical, IAI has decided to assimilate and advance the principles of sustainability in all areas of our operations. Under this philosophy, we are now implementing a binding policy of continuous management improvement based on sustainability principles. IAI has maintained a fabric of social and environmental values for many years. These values are expressed on the individual employee level, managerial levels and executive officers. This investment will continue to serve the business growth of IAI with an emphasis on investing in forward looking R&D, establishment of processes and infrastructures, including in sustainable operations committed to economic, social and environmental excellence.”
IAI’s large-scale operations and their significant impact on Israel’s defence and economy warrant stronger adherence to sustainability principles, and the process is managed at IAI according to the highest professional standards in a manner that allows for close monitoring and execution. The drafting of multiannual plan with measureable objectives is part of the practical approach adopted by IAI based on a view of long term, sustainable growth.
IAI’s updated sustainability policy reflects 21 material issues identified as core sustainability areas, including economic performance and innovation, corporate governance, social responsibility and environmental management. Below are some of the Report’s main highlights:
As a large State company, IAI promotes procurement from local suppliers with an emphasis on procurement from the periphery. In 2016, IAI spent $1.9 billion on procurement, of which 61% were from local suppliers, a 9%-increase over 2015. IAI is Israel’s largest State employer with 15,359 employees in 2016. During 2016, IAI started a retirement process for 730 employees as part of growth plan coordinated with the workers union. The Company encourages its employees to become involved in the community with technological education being the chosen focus for social responsibility. IAI employees volunteer in a range of activities with 5% of the volunteers doing so on a regular basis.
Environmental management processes at IAI have started back in the 1990’s when an environmental steering committee has drafted the Company’s policy for this area. Today, all of IAI’s manufacturing units comply with ISO 14001 Environmental Management Standard. IAI is an active member of the International Aerospace Environmental Group (IAEG), a commercial organization founded by the world’s largest aerospace and defence corporations to make the value chain of the aerospace and defence sector more sustainable, mitigate possible development and manufacturing risks and make IAI products more environmentally friendly. As the only Israeli member in this organization, IAI is active in a range of work groups, for example on reporting of hazardous substances along the supply chain, drafting of uniform supplier questionnaires and establishing guidelines for reporting on greenhouse gases emissions that are unique to this sector.
Another area on which the Company has focused managerial efforts is optimizing energy and fuel management. As of May 2014, IAI’s entire power consumption is sourced from private supplier and is based on 100%-CNG/ 2015 was the first year in which IAI consumed this electricity. As of 2007, IAI is gradually implementing a series of measures to reduce the Company’s power consumption. As of 2016, IAI saved 24% compared with its “business as usual” scenario (435 GWh). In 2016, fuel consumption for industrial use (LPG and diesel fuel) was 906,544,198 MJ and fuel consumption for transportation (leased cars, carpooling and jet fuel) was 12,453,198 MJ. Right now, IAI is evaluating renewable energy solution concurrently with massive infrastructure replacement which is expected to yield additional reduction in energy consumption and greenhouse gas emissions.
In 2016, IAI disposed of 2,517 tons of hazardous waste, of which 54% were reused or recycled (compared with 33% in 2015, an increase of more than 20%). Some of the waste was exported abroad for energy recovery processes under the Energy Ministry’s approval. In 2016, IAI disposed of 10,087 tons of non-hazardous waste, of which 58% were reused or recycled (compared with 51% reuse or recycling in 2015). In 2016, IAI used 342,993 cubic meters of water and generated 202,402 cubic meters of waste water as part of manufacturing, maintenance and cleaning processes of its facilities. As a result of in-house monitoring processes, all of IAI’s industrial wastewater is transferred to pre-treatment facilities before being stream to external wastewater treatment facilities.
