Does your company’s activity fall under Division 20.2 of Annex I to Regulation (EC) No 1893/2006?

  • Radia Guira

Regulation (EC) No 1893/2006 establishes the statistical classification of economic activities NACE (https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:32006R1893&from=en)
The possible answers are:
– Yes
– No

This question is asking whether the activities of your company are classified under Division 20.2 of Annex I to Regulation (EC) No 1893/2006. Essentially, this European Regulation is applicable to certain categories of enterprises which deal with the manufacture of pesticides and other agrochemical products.

« Division 20.2 » represents a specific classification of economic activities under the EU law. Companies under Division 20.2 typically produce substances to destroy or control pests, improve or protect the health of plants and animals, or regulate the growth of plants.

Are your production activities aligned with this? The pertinent consideration here relates to manufacturing activities and whether these are related to the development and production of substances such as pesticides and other agrochemical products.

Here, it’s a Yes/No question according to your company’s particular industrial activities.

Example: If your company is involved in manufacturing of agrochemicals, your answer could be: « Yes, our company’s activity falls under Division 20.2 of Annex I to Regulation (EC) No 1893/2006. »
If not, then your answer could be: « No, our company’s activity does not fall under Division 20.2 of Annex I to Regulation (EC) No 1893/2006. »

Understanding the Scope of Division 20.2 of Annex I to Regulation (EC) No 1893/2006

When it comes to assessing a company’s sustainability profile and its ESG (Environmental, Social, and Governance) score, understanding the full range of your company’s activities is crucial. One specific area that often requires clarification is whether a company’s operations are classified under Division 20.2 of Annex I to Regulation (EC) No 1893/2006. This classification pertains to the manufacture of pesticides and other agrochemical products, which carry specific ESG considerations due to their environmental impact.

Firstly, let’s dive into what Division 20.2 encompasses. According to the regulation, this division includes the production of a variety of substances that are used to control harmful or unwanted flora and fauna. This includes producing herbicides, insecticides, fungicides, acaricides, and molluscicides. The division also covers the manufacture of anti-sprouting products, plant growth regulators, and chemical products used for plant protection and pest control.

It is essential for companies to identify if their activities are categorized under this division because of the associated ESG risks and impacts. The production of these substances can have significant environmental effects, particularly on water quality, soil health, and biodiversity. From a social and governance perspective, companies must also consider the health and safety implications for workers and consumers, as well as the regulatory compliance aspect associated with chemical production.

Assessing Your Company’s Operations Against Regulation Criteria

To accurately determine if your company’s operations fall under Division 20.2, you need to conduct a thorough analysis of your production processes and outputs. Companies that produce chemical substances for plant protection or pest control should closely examine the list of activities described in Annex I of Regulation (EC) No 1893/2006. By comparing your product lines and production activities with the regulatory definitions, you can be more confident in your self-assessment.

If you find that your company does indeed operate within this division, it will be pivotal to your ESG evaluation to report this accurately. Transparency in your company’s involvement with chemicals is necessary for stakeholders who are increasingly concerned with sustainability practices. Furthermore, it impacts your company’s compliance with regulations and its reputation in the marketplace.

For those companies that are uncertain about their classification, seeking expert guidance or utilizing tools like FinGreen’s chemical production boolean metric may help you to navigate the complexities of ESG reporting and compliance. These resources can provide a more definitive answer and support you in developing a clearer ESG profile for your company.

Enhancing Your ESG Profile in Light of Division 20.2 Activities

Once you’ve determined that your company’s activities fall under Division 20.2, it’s time to think about how this influences your ESG score and what steps can be taken to improve it. An important aspect to consider is the implementation of sustainable practices in the production process. This could involve investing in cleaner technologies, enhancing safety measures, and adopting more stringent environmental management systems.

Further, your company should regularly engage with stakeholders to discuss the use of these chemicals and demonstrate a commitment to reducing their environmental footprint. This includes providing training for safe handling, implementing emergency response mechanisms, and encouraging the development of less harmful alternatives.

Last but not least, ensure that your company maintains rigorous compliance with all applicable laws and regulations. Staying ahead of regulatory requirements not only helps in managing risks but also positions your company as a leader in responsible chemical production. It’s a powerful way to enhance your company’s ESG profile and build trust with consumers, investors, and other stakeholders.

In conclusion, knowing whether your company’s activities are classified under Division 20.2 is not just a matter of regulatory compliance; it’s a significant component of your ESG reporting and score. By understanding the implications of these activities and taking proactive steps to manage the associated risks, your company can demonstrate a strong commitment to sustainability and responsible governance. Remember that in the realm of ESG, transparency, and action go hand-in-hand, leading to a more sustainable future for all.