SustainabilitySustainability strategyMateriality Analysis

For identification of strategic sustainability priorities, as well as for definition of the contents of the Consolidated Non-Financial Statement, during 2020 the Recordati group updated the materiality analysis. This is aimed at identifying, in application of the reporting standards issued by the Global Sustainability Standard Board of the Global Reporting Initiative (GRI), the material aspects of sustainability that can significantly influence the decisions and opinions of stakeholders, as well as the Company's performance.

In fact, the Materiality Matrix is an important tool to identify the most relevant sustainability topics from the perspective of the Company and of stakeholders. It forms the basis for preparation of the Consolidated Non-Financial Statement and helps to identify the ESG factors, i.e. those of an environmental, social and governance nature, on which to focus strategies and actions. 

The Materiality Matrix is not a static tool but requires periodic updating on the basis of scenario evolutions, megatrends, emerging topics, and maturity level of sustainability within the company. This is why the group felt it was important, three years after the initial analysis, to launch an update procedure, in compliance with the requirements of the GRI reporting standard. 

Updating of the Materiality Matrix, performed by the Environmental, Social and Governance department, with the support of a recognised specialised consulting company, necessitated the development and implementation of various project phases, and specifically: 

    • preliminary analysis 
    • stakeholder engagement
    • involvement of top management
    • definition and approval of the 2020 Materiality Matrix

Preliminary analysis

In this initial phase, the Group performed preliminary analysis with the goal of monitoring and identifying the main material topics at an international level and for the relevant sector.
The phase of identifying sustainability topics that are potentially relevant for the sector and for Recordati was based on analysis of various sources of information, some of the most important being: corporate documents (Code of Ethics, risk map, etc.), external documents analysing the context and research on sustainable development policies (e.g. reports prepared by the World Economic Forum), benchmarking analyses of the primary competitors and Internet research activity. Consideration was also given to multi-stakeholder initiatives and international standards for management and reporting of corporate sustainable-development policy, including the GRI and SASB standards.  General analysis also took into consideration the main criteria of rating agencies and ESG analysts and the Sustainable Development Goals. 

The results of this preliminary analysis, also through comparison with the material topics present in the previous Matrix, enabled the Group to define a list of potential material topics to submit for the evaluation of the stakeholders and top management.

Stakeholder engagement

Between September and November 2020, the Recordati group implemented stakeholder-engagement activity, involving and listening to the points of view of stakeholders, with the goal of making the Materiality Matrix update process even more robust, in line with best practices and the main sustainability frameworks, and specifically in compliance with the requirements of the GRI standard.
For this purpose, using the results of the preliminary analysis, an online questionnaire was prepared and sent to a panel of around 150 recipients belonging to all of the various stakeholder categories, previously identified in close collaboration with the different company departments. The stakeholders evaluated the individual topics, assigning a score to each on a scale from one to five, and therefore contributed to defining the prioritisation of the topics on the basis of the assigned relevance. The questionnaire also requested indication of any additions to the topics identified. 

The stakeholder-engagement activities carried out promoted inclusion of the points of view of stakeholders in the Materiality Matrix and more precise identification of the material topics for which stakeholders of the Group expect constant commitment and tangible actions from Recordati, in compliance with the guiding principle of stakeholder inclusiveness of the Global Reporting Initiative.

Management interviews

In addition to stakeholder engagement, the Recordati group has taken actions for engagement of Top Management, in order to identify priority material topics from the Group's perspective. Top Management engagement was implemented through one-to-one meetings and an online questionnaire. Top management was also asked to evaluate the individual topics on a scale of one to five and to indicate any proposed additions to the topics identified. 

Creation of the 2020 Materiality Matrix 

During the final phase of the Materiality Matrix updating process, the Group processed data and summarised results of the evaluation of material topics by stakeholders and top management. This enabled a specific ranking of material topics and prioritisation of them within the new Recordati group 2020 Materiality Matrix.
The results of analysis were discussed with executive management and subsequently the new Materiality Matrix was shared with the Risk, Control and CSR Committee and the Board of Directors.

The Materiality Matrix represents the 17 topics* selected according to their economic, social and environmental relevance both for the Recordati group and for the stakeholders involved. In particular, the Matrix identifies the level of importance assigned to the topics from the perspective of management on the horizontal axis “Relevance for the Recordati group” and from the perspective of stakeholders on the vertical axis “Relevance for Stakeholders”. Material topics are grouped into five specific areas according to the impacts generated for various categories of stakeholders: ethics and integrity, patient care, people care, environmental protection and responsible sourcing. The topics of relevance identified in the Materiality Matrix are discussed and explored in subsequent chapters of this Statement in compliance with the reporting standard and the provisions of Italian Legislative Decree 254/2016. It is noted that aspects linked to “Governance”, “Regulatory Compliance” and “Risk management” are not included in the final proposal amongst the material topics for the Group as these aspects are considered as essential prerequisites for Recordati to continue to generate value and thus are in any case subject to reporting within Consolidated Non-Financial Statement.
*The main new elements of the revised Recordati group Matrix compared to the previous version, in addition to Stakeholder Engagement and prioritisation of topics, include several instances of rewording (to make certain topics more specific), greater rationalisation of the topics performed also by grouping them together (e.g. the topic of “Human Rights” has not been considered as a separated topic but is handled within other topics such as “Responsible sourcing”, “Business ethics, integrity and anti-corruption”, “Diversity and equal opportunities” and “Research and development”) and more specific handling and definition of topics (e.g. in the environmental cluster, the specific topics “Fight against climate change” and “Water management ” have emerged, which were previously included within “Environmental protection” and “Efficient use of resources”). Other new topics such as “Product sustainability” and “Privacy and data protection” have emerged from the analysis.