Environmental, Social And Governance Fınancing : The Case of Tosyalı Holding

Tosyalı Holding has been operating in Turkey for nearly 70 years in the production of steel products with over 40 facilities on three continents and approximately 15,000 employees. Tosyalı Holding is Turkey's global producer with an iron and steel production of nearly 15 million tons.

The iron and steel industry is a sector that consumes high energy. The energy sources are fossil resources such as coal and natural gas, which have high carbon emissions. These energy sources cause pollution of the environment and air due to their high carbon emissions. High carbon taxes have been envisaged as part of the measures to address this problem worldwide, such as the Paris Climate Agreement, and later, especially the European Green Deal and the Border Carbon Adjustment Mechanism.

Importance in terms of ESG :  Tosyalı Holding has made significant investments in renewable energy resources since 2020, with the influence of the incentives provided by the state, and has started to use renewable energy resources in iron and steel production. These investments have been financed by providing both equity and external funds with a sustainable production approach. Thanks to these investments, carbon emissions in production activities have been reduced by 50%.

Why It’s Best Practice: Tosyalı Holding developed a sustainability strategy in 2021 with the participation of its stakeholders, taking into account international standards and global indices. Within the scope of this strategy, it has grouped its priority areas into three groups. These are; Responsible Ecosystem Management, Carbon-Free Steel and Future of Business.

Making green investments in all its operations, some of which are world firsts and are shown as best practices in the steel industry, Tosyalı Holding stands out as an iron and steel company that takes rapid action on the Border Carbon Adjustment Mechanism (BCDM) designed by the European Union.

In addition to more than 100 sustainability projects aimed at reducing steam, electricity, water and natural gas consumption, it has also received the International Green Energy Certificate (I-REC) by ensuring the traceability of the energy it produces and showing that the electricity is produced from renewable sources.

The company is progressing towards the goal of becoming the first steel company to produce with green hydrogen, which provides significant reductions in greenhouse gas emissions. In this context, Tosyalı V-Green brand, representing green steel products with low carbon emissions, won the Environmental Product of the Year - ESG Campaign award at “The ESG & Sustainability Awards”, one of the most prestigious awards in the world.

  In the evaluation made by the “Foundation of ESG”, which gave the award; Tosyalı Holding's Tosyalı V-Green brand represents sustainability leadership and sets a new standard for green steel production worldwide. With these results, the Company has documented that it produces with approximately 50% less carbon emission than the accepted values ​​of the European Commission.

Key Lessons Learned:

1. Tosyalı Holding uses renewable energy sources instead of fossil fuels.

2. It contributes to the prevention of environmental pollution by reducing carbon emissions.

3. It has taken the lead in competition by preventing resource waste and providing cost advantage thanks to its investments.

4. It has led the sector by increasing the traceability of production processes.