Sustainability strategy

For three decades, our business model has been built on a foundation of sustainability. Our ambition is to create sustainable technology for a sustainable world, creating long-term value for all our stakeholders. We strongly believe that our dedication to a sustainable culture is beneficial for people, the environment, the economy, and society.

Accelerating sustainability, together

Throughout our value chain, we have integrated sustainability into our business model. We have implemented numerous programs to effectively manage our impacts, opportunities, and risks, ensuring that sustainability remains at the forefront of our operations and activities.

Our guiding principles and 24 sustainability goals are detailed in our sustainability charter, which is available at www.st.com/sustainabilitycharter. This is endorsed by Jean-Marc Chery, our President and CEO. Our progress towards these annual, 2025 and 2027 goals is described in this report, with a focus on transparency.

To support our ambitions, we include sustainability criteria among performance indicators for both short-term and long-term incentive schemes for all senior executives and all other employees eligible for incentives. The sustainability/corporate social responsibility index short-term incentives are weighted at 10% with criteria comprising health and safety, environment and climate, diversity and inclusion as well as people management. Sustainability/corporate social responsibility index criteria for long-term incentives are weighted at 33.3% and comprise environment and climate, diversity, inclusion and people engagement, investor ESG index and carbon rating.

As part of our plan to accelerate sustainability and engage our stakeholders, in February and November 2023 we conducted a series of internal sustainability webcasts, each attracting more than 3,000 people. The aim was to share our approach to sustainability trends and challenges, and to update employees on our sustainability programs and performance. There was also an opportunity for employees to ask their own questions on sustainability during and after the live events.

Assessing material topics

We have been conducting materiality assessments since 2010 to identify and prioritize the most significant sustainability topics for our business and stakeholders. We carry out a materiality exercise every year, including a review with our main stakeholders. This allows us to focus our efforts on the most relevant issues and integrate them into our strategy, programs, and objectives.

We assess our impacts continually, taking into account the global sustainability context, identifying emerging and evolving topics, the role of our industry, and evaluating any changes in our activities and business relationships. We consult with experts and regularly engage with our stakeholders to gather their views (see Stakeholder engagement). This enables us to understand and integrate the topics most significant to our stakeholders and that have a positive or negative impact on our business’ economic, social, and environmental value. Where appropriate, we combine topics to reflect our highest priorities and the rapidly evolving sustainability environment.

In 2023, we considered sustainability trends and challenges at a global and industry level, reviewing different sources from the electronics industry and business associations, as well as data-driven insights from an AI software platform. This provided a framework for a deeper analysis, including data points from public sources such as corporate financial reports, regulations, voluntary initiatives, news, and social media.

As in previous years, the most material topics we identified in 2023, and which form the basis of our priorities, are health and safety, GHG emissions, water efficiency, and human rights. However, we also took into account concerns expressed by our external stakeholders regarding the potential impact of our activities on pollution (see Chemicals).

Click on a focus area to see the relevant material topics

Overview

Governance

Business

People

Environment

Communities

No Priority*

*Not a strategic priority but some programs in place

We address each identified material topic in the matrix above through dedicated programs, with associated goals and targets.

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Sustainability strategy

Augmenting
everybody’s life

Sustainable financial performance
Innovation
Sustainable technology
Customer satisfaction

Putting
people first

Health and safety
Labor and human rights
Talent attraction and engagement
Diversity, equity, and inclusion

Protecting
the environment

Energy and climate change
Water
Waste, circular economy, chemicals
Biodiversity

Interview

Rajita D’Souza

President, Human Resources and Corporate Social Responsibility

Can you give an overview of sustainability at ST in 2023?

2023 marked yet another acceleration of sustainability at ST. We see sustainability as a question of systemic balance. Economic, social, and environmental issues are interdependent, and many decisions need to be taken to balance short- and long-term needs, risk and opportunities, mitigation, and adaptation, among others. This approach involves the entire organization, which is why we appointed additional  sustainability champions in 2023. They are responsible for further embedding ST’s sustainability strategy into all groups and divisions of the Company.

We launched ‘Accelerating sustainability, together’, a program to strengthen and support our sustainability strategy. It aims to develop ST’s sustainability leadership and embed sustainability in each step of business strategy, planning, and decision-making. We also implemented accelerator workstreams to facilitate cross-organization collaboration in priority areas.

What sustainability achievements were you most proud of in 2023?

I’m thrilled that we have been able to support important business growth, while maintaining our commitment to sustainability. We exceeded all our absolute targets for our carbon neutrality program and continued to work towards our ambitious sustainability goals. I’m also proud that we made significant progress in our diversity, equity, and inclusion strategy, particularly with the creation of employee resource groups. Our women’s network – WISE – continues to go from strength to strength and we created our LGBTQIA+ and allies’ network – STAND. Our Blossom network, established three years ago to represent younger employees, is actively supported by a growing number of executives, including our President and CEO. Horizon, our transformation program to support ST’s growth ambition, has entered a new phase with the introduction of several new ways of working to positively impact employee experience. We have also integrated the pillars of our associated leadership model – smart, agile, bold, and engaged – into our performance management to grow and develop competencies. I continue to believe that prioritizing and investing in our people is crucial and helps us achieve our goals as one ST.

What factors will shape ST’s sustainability strategy in the future?

There are many factors that shape our sustainability strategy. We engage closely with all our stakeholders to strictly monitor their needs and expectations. We are operating within an increasingly complex and volatile environment, which presents many local and global challenges. To address these, we aim to be agile, adapting our approach where necessary while remaining true to our core beliefs and strategy.

We believe our technology can play a crucial role in addressing many of these challenges. It is our goal to have a positive impact on society, while maintaining a proactive approach to mitigating the impact of our operations as far as possible.