2008 Novus Sustainability Report

2008 Sustainability Report

� | NOVUS International

COMPANY PROFILE ................................................................................. 3

MESSAGE FROM THE PRESIDENT ....................................................... 6

SCOPE OF REPORT .................................................................................. 8

VISION FOR SUSTAINABILITY ........................................................... 10

INDUSTRY CHALLENGES, ACTIONS AND FUTURE PLANS ........ 11

CRITICAL SUCCESS FACTORS ............................................................ 13

GROWTH ............................................................................................. 13

PROFITABILITY ................................................................................. 15

PEOPLE ................................................................................................. 18

REPUTATION ...................................................................................... 20

SUMMARY ................................................................................................ 24

ABBREVIATIONS, REFERENCES, AND TABLES ............................. 25

GRI INDEX ................................................................................................ 26

CONTACT US ........................................................................................... 28

Contents

At Novus, we believe that sound research & development is the foun-dation for success in developing and delivering solutions to customers. We believe in Performance through Innovation, which is why we employ more than 50 scientists, engineers, nutritionists and Doctors of Veterinary Medicine to create new products and programs. In addition to our in-house expertise, Novus has developed a global network of university profes-sors and academics, which helps to ensure that our products are grounded in science and fact. Novus’s primary research & development center is located at the company’s headquarters near Saint Louis, but we also employ a global network of university and industry collaborators to develop and test solutions for local needs.

As Novus continues to grow, we will continue to expand our profes-sional networks and affiliations

to deliver sustainable solutions that improve performance for our customers. We feel a deep responsi-bility to transfer the knowledge we gain as well as the technology and innovations we develop to people around the world who can use them to improve agricultural practices in their local communities.

Novus provides products and programs for the poultry, pork, dairy, beef, equine, and companion animal industries. At the end of fiscal year 2008 (March 31, 2008), Novus had approximately 400 employees located in 20 different countries, selling close to 70 products to support livestock performance, improved animal well-being, food safety and the environ-ment. Our products promote nutrition and health, and can be divided into technology platforms: amino acids, organic acids, organic trace minerals, antioxidants, vaccines, mycotoxin control, and enzymes and yeasts. For specific information about Novus, its products and solutions, please visit our Web site at www.novusint.com.

Novus continues to grow through the innovation and performance

Company Profile

Novus International, Inc. is a global leader in creating science-based

health and nutrition solutions. Over 2,500 clients in more than 80

countries trust the Novus product family to be an integral part of

their daily animal agricultural operations. The company is privately

owned by Mitsui & Co. (U.S.A.), Inc. and Nippon Soda Co., Ltd. and

is headquartered in the Saint Louis, Missouri, USA area. Novus’s

Mission is to “help feed the world affordable, wholesome food.”

Company Profile | �


of its key product lines and with the guidance of senior management and its Board of Directors. Under the guidance of President and CEO Thad W. Simons Jr., Novus respon-sibly grew sales to more than $700 million in fiscal year 2008. With the support of our parent companies and the Chairman of the Board, Shinji Tsuchyia, Novus has been successful in expanding its business by devel-oping and providing safe, environmen-tally-friendly products and solutions that improve our customers’ business performance.

Novus Corporate Governance Statement

Corporate governance at Novus International, Inc. is the responsi-bility of the Board of Directors. The Novus Board represents the inter-ests of the Novus shareholders and stakeholders, including employees, customers and the public. The Novus Board, with the advice of the execu-tive management team, determines the company’s long-term strategy, while the Novus management team defines the company’s short-term strategies and handles day-to-day business and operations.

In 1998, the Novus Board of Direc-

Novus’s health and nutrition products and programs serve virtually all of animal agricul-ture –designed with our goal of sustainability in mind. Novus’s programs consist of tailored, complementary combinations of products and services to maximize its customer’s performance, addressing concerns such as gut health and oxidative balance. These programs take advantage of the science, skills and knowledge at Novus to address concerns in all the markets we serve.

PoultryNovus has a broad range of complete

production cycle programs and products to meet the needs of modern poultry produc-tion. Novus has over five decades of basic and applied research, development and manufacturing expertise in amino acids and antioxidants. We utilize our understanding of

the gut and metabolic processes to develop, manufacture and support multiple lines of nutritional and health products for the poultry industry. Novus serves the broiler, broiler breeder, game bird, layer, turkey, turkey breeder and duck segments.

SwineNovus has developed a unique range

of programs for pork producers to support animal health and performance. Novus can help producers improve animal wellbeing, increase performance rates, and direct feed to high-value, lean gain. Novus serves the swine nursery, growing, grow-finish, finishing and sow segments.

DairyNovus offers a diverse family of

complete production cycle programs and

products to help producers improve the health and nutrition of dairy cows. Based on sound scientific research, our products are safe, reliable, and efficacious. Novus provides products and solutions for the transition, early-lactation, mid-lactation, late-lactation and replacement heifer markets.

BeefNovus’s complete production cycle

programs and products for livestock deliver optimal animal health and performance. Novus helps producers effectively manage the health of their cattle from calf to feedlot, ultimately improving their bottom lines. Novus provides products for cow/calf oper-ations, feedlots, stockers, backgrounders and for the receiving markets segments.

Novus products responsibly serve all of animal agriculture

North AmericaBeaumont, Texas, USAChocolate Bayou, Texas, USA Lincoln, Nebraska, USA Little Rock, Arkansas, USAMexico City, Mexico Ottawa, Ontario, Canada Saint Charles, Missouri, USA

South AmericaBogotá, ColombiaBuenos Aires, Argentina Caracas, VenezuelaIndaiatuba, BrazilPorto Alegre, BrazilSantiago, ChileEuropeBergamo, ItalyBrussels, BelgiumGudensburg, GermanyMadrid, SpainNantes, FranceWarsaw, Poland

Asia - PacificBangkok, ThailandBeijing, ChinaHyderabad, IndiaJakarta, IndonesiaSeoul, South KoreaShanghai, ChinaSingaporeSydney, Australia

l Global Headquartersl Regional Headquartersl Manufacturing Plantl Major Sales Officel Research Facility

Yunnan, China

tors approved and adopted the Novus Integrity System (NIS), containing written policies to ensure that all employees understand that good ethics and good business are synony-mous when viewed from moral, legal and practical standpoints. The NIS is a constant reminder of the Board’s commitment to corporate and personal integrity, and prompts every employee of the need to conduct the business of Novus within the ethical framework adopted by the Board. The

Novus Board has made clear through the NIS and other Novus policies and procedures that the company will strive at all times to make deci-sions that are not only lawful but also morally and ethically sound.

In 2005, the Board chartered the Novus Compliance Committee, comprised of all members of Novus’s senior management team as well as shareholder representatives. The purpose of this committee is to review and evaluate compliance issues and concerns throughout the Novus organization. It also focuses on prevention, detection, response and security, as well as to propose actions for the continuous improve-ment of Novus’s business manage-ment and operations. The matters within the scope of the Compliance Committee’s review include all legal and regulatory matters that impact or may impact Novus’s operations worldwide. The Committee also oversees compliance and conformity by Novus with the requirements of organizations in which the company maintains memberships and for standards, policies or programs to which Novus subscribes. The Compli-ance Committee manages compli-ance issues and reports to the Board on a periodic basis.

Overall growth since 2002

Company Profile | �

AquacultureNovus Aqua is dedicated to developing

products with performance and innovation that exceed customers’ expectations in the global aquaculture market. Novus Aqua focuses its efforts on providing products and services based on sound scientific studies. We are sensitive to current and future social, economic, and environmental conditions. We offer efficient alternatives, products, and services for sustainable aquaculture and business practices. Novus products and programs address nutrition, health and the environment through water treatment, probi-otics, hatchery products, fish meal replace-ment and sustainable antibiotic-free culture.

Novus Nutrition BrandsNovus Nutrition Brands (NNB) is a

segment of Novus with marketing responsi-

bilities in the equine, pet, human and other non-food animal markets. NNB is focused on developing and delivering unique, value-added products and technologies that can optimize the health, performance and longevity of individual animals or people. NNB is divided into three distinct business areas:

Arenus:ARENUS is the umbrella brand for a line

of finished dose form equine, canine and feline dietary supplements. Arenus products are marketed to horse and pet owners and are sold through veterinarians, select retail affiliates and direct to consumers via www.arenusperformance.com. The first product group sold under the ARENUS brand is STEADFAST by ARENUS, a line of structural health products. STEADFAST products leverage the science of Novus’s proprietary

ingredients (i.e. MINTREX, ZORIEN and MHA).

Novus Pet Nutrition (NPN)Novus Pet Nutrition serves pet food manu-

facturers and ingredient suppliers to the pet food industry. Novus Pet Nutrition products are animal health solutions that include plat-forms for the improvement of gut health and reduction in oxidative stress. Novus Pet Nutri-tion products include organic trace minerals, methionine analogues, antioxidants, omega-3 fatty acids, enzymes and others.

Novus Human Nutrition (NHN)Novus Human Nutrition has been

chartered to develop and deliver unique, science-based products and services to other businesses within the human dietary supplement and food industries.

0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000

(USD 000)

FY 08

FY 07

FY 06

FY 05

FY 04

FY 03

FY 02 Debt to Equity ratio2008 ~1.3

Australia

LatinAmerica

Asia

EAME

North America

Sales by Region FY08


Novus is very much a customer-focused company. With a reputation built on quality and reliability, we strive to exceed customer expec-tations. We make every possible effort to maintain or improve our corporate citizenship on a global basis, each day earning the business of our customers and the respect of our stakeholders. We do this by supporting and promoting compli-ance with laws, regulations and voluntary industry standards that protect our community, workplace and the environment.

Corporate Social Responsibility (CSR) or Sustainability has become an increasingly important part of doing business. We understand that for Novus to be successful, we must ensure that our sustainability values are embedded in every employee’s daily activities — what employees want in order to improve Novus’s outlook. This ‘natural symbiosis’ between company and employee activities builds new, repeatable and sustainable business practices that help achieve the goal of “meeting the needs of the present without compro-mising the ability of future genera-tions to meet their own needs.”1

This report intends to outline our recent sustainability efforts as well as endeavors to make sure we are always acting in the best interests of our stakeholders. Sustainability at Novus is founded on the triple bottom line: social, economic and environ-mental factors. While the environ-mental and social factors are vital to satisfying the demands of stake-holders, they also must be economi-cally justified to be sustainable.

We strive to assist our customers in finding sustainable solutions to

meet the global challenges facing animal production. Animal wellbeing, efficiencies of production, food safety and environmental issues are impor-tant challenges and critical to our customers. If properly addressed, they provide benefits for all stake-holders, not just Novus. We positively influence the industry by supporting a shift towards responsible produc-tion of food through using fewer resources and offering animal protein producers options to reduce their environmental impact.

Critical Success FactorsAt our annual 2008 strategic

planning conference, we identified four factors critical to the future success of Novus: Growth, Profit-ability, People and Reputation. Novus decided to build on these four factors, developing strategies and tactics to meet our goals as an organization while providing benefits to our stakeholders in a sustainable manner. These factors are guideposts to our people and help us deliver on our ethical, social and environmental responsibilities while operating with fiscal accountability.

Serious about food safetyLooking first at food safety, Novus

is very serious about this concern and realizes that it is a global public health issue. Outbreaks of food-borne disease have been documented on every continent within the past decade, some with devastating social and economic consequences. Producers at every level of the food supply chain are being called upon to actively participate in the delivery of safe products to the public. At the same time, consumers want to mini-mize the use of antibiotic drugs.

Safe food begins at the farm level. As an example, Novus’s gastrointestinal health products used in drinking water and/or feed

I’m proud to say that this is Novus’s first ever Sustainability Report

and that we will be following the G3 Guidelines set out by the

Global Reporting Initiative. Even so, monitoring environmental,

economic, and social factors were a part of our core values from the

inception of our company back in 1991.

Message from the President

Thad Simons Jr., President

Section headline here, please.

Message from the President | �

help reduce the colonization of salmonella in poultry and swine. The animals are healthier, resulting in enhanced animal comfort and optimum production efficiency. Used in combination with our coccidiostat, poultry can be effi-ciently produced in a drug-free environment.

Safe sourcing of ingredients

Safe sourcing of product ingredi-ents is particularly important for the global food chain. Novus has a high quality network of vendors supplying the ingredients for our products, and in many cases we manufacture the ingredients ourselves. Novus maintains traceability in all products we produce, so producers can rest assured that their animal nutrients are safe.

Novus offers solutions for anti-microbial safety. Our antimicrobial products reduce pathogens, mold and resulting mycotoxins. To be clear, Novus’s solutions for health and safety do not contain antibiotics. We enable producers to competitively increase performance and profits through the use of antibiotic-free health and nutrition programs.

Novus also strives to help producers meet the nutritional demands of modern livestock while

balancing environmental concerns. We are committed to protecting the environment in all areas where we conduct business. Our organization works through scientific research and development. We do this both by using our own scientists and on a larger scale, our global partnerships with university and independent scientists and experts – to create nutritional programs that reduce the environmental impact of animal agriculture.

Novus raises standards of animal wellbeing

The wellbeing of farm animals is an increasingly important public and political issue throughout the world and is important from both ethical and business perspectives. Animals in less stressful environments have better performance, a lower occur-rence of disease, and higher repro-duction rates.

Novus collaborates with producers throughout the world to raise the standards of animal well-being. For example, Novus worked with a leading poultry producer to improve the quality of life for turkeys that were experiencing high rates of structural abnormalities and mortality associated with rapid growth. To approach this common challenge for poultry producers, Novus created a customized nutri-tional strategy. The result: More than a 40% overall decreased occurrence of foot pad lesions, leg weakness and leg fracture. With this signifi-cant increase in structural health, the animals were able to express normal behavior and had greater alertness, mobility and freedom of movement. In addition to these health benefits, the producer increased his profitability.

In summary, we are delivering a “triple bottom line.” As we look towards the future, Novus’s goals and objectives will include contin-uous improvements to build on our exceptional performance and creation of business practices that are truly sustainable, which will help to feed the world affordable whole-some food and achieve a higher quality of life.

Section headline here, please.


In this report, we describe Novus’s approach to sustainability, relevant data, programs, projects and key activities we are executing. This includes Novus’s activities in procure-ment, manufacturing, distribution and sales of products that are directly under the control of Novus’s manage-ment. Often, Novus can measure, estimate and assess the benefits and burdens that result from our actions. Where sustainable benefits are avail-able and it is appropriate for Novus to influence their capture, we can institute improvements.

This report covers selected activi-ties along the value chains that are controlled by Novus, but not directly managed by us. These are activi-ties that Novus has identified both as important and that we can influ-

ence. Changes in these activities will require ongoing cooperation with our customers, suppliers, and value chain partners. These changes offer all parties opportunities to improve the “triple bottom line.”

The specific topics within the spec-trum of activities on which Novus can focus its efforts are the environment, food safety, animal wellbeing and performance. These have been four tenets of Novus’s operations almost since inception and are critical to our industry and stakeholders.

This report describes and reviews activities and topics that Novus has pursued, in line with our Vision, Mission and Core Values. Topics, projects and proposals for future action will expand and continue to evolve within the company. They will take into account relevant, current issues relating Novus’s activities and our relationship with stakeholders. In the future, it is possible that topics and projects could be presented and

Novus believes that doing business sustainably is an ongoing

process, and we are committed to embedding and implementing

sustainable practices in our everyday activities. This report

covers Novus International, Inc. and its major subsidiaries

from 1 January, 2007 to 30 June, 2008. It is prepared for all

stakeholders, including business partners, customers, residents of

our local communities, government agencies, non-governmental

organizations (NGOs), and our employees.

Scope of Report

Scope of Report | �

discussed with external stakeholders to ensure that we are focused on the items of greatest impact for the indus-tries in which we operate.

Over time, Novus will be able to develop a basis for deriving Key

Performance Indica-tors (KPIs) that can be used to monitor progress in sustain-ability activities and reporting. Reporting will likely be based on information held (or already reported) by corporate offices and on informa-tion gathered from the businesses and

operating compa-nies that are fully owned by Novus. Acquisitions will be included in future sustainability reports when they are 100% owned by Novus before the end of our fiscal year, which is currently 31 March. Divestments during a fiscal year and activities or operations of Novus’s contract manufacturers and distributors are not included in this sustainability report. A review of our agreements will be made and a future determination provided as to Novus’s ability to report on third party manufacturing partner’s operations or activities.

Statistics on social data reported, such as number of employees, relate to all Novus sites, excluding agency

staff, distributors, consultants and any other non-permanent employees working with Novus under long- or short-term contracts (e.g., consul-tants).

Environmental parameters in this report and on our website are calculated from the data supplied by Novus’s production sites. Most of the data reported has been recorded by Novus staff or corporate management teams as part of our normal manage-ment processes. Some, such as ‘Total workforce by employment type, employment contract, and region’ and ‘Operations identified as having signif-icant risk for incidents of child labor, and measures taken to contribute to the elimination of child labor’ are gathered specifically for this report. All the data was checked, collated and confirmed by Novus management.

Assembly and reporting of the above data and activities constitute qualification for Report Application Level C of the current guidelines of the Global Reporting Initiative (G3). A GRI index and an Application Level Grid on pages 26-27 list the performance indicators reported in this sustain-ability report.

Novus is also addressing issues that are external to the boundaries of its activities and includes activities such as support for advanced degrees in agricultural education, certification programs, environmental funding and partnerships, and responsible and

EnvironmentNovus strives to help producers meet

the nutritional demands of modern livestock while balancing environmental concerns. We are committed to protecting the environment in all areas where we conduct business. The organization works, through scientific research and development, to create nutri-tional programs that reduce the environmental impact of animal agriculture.

Food SafetyFood safety is a global public health issue.

Outbreaks of food-borne disease have been documented on every continent within the

past decade, some with devastating economic and social consequences. Producers at every level of the food supply chain are being called upon to actively participate in the delivery of safe products to the public.

Animal WellbeingThe wellbeing of farm animals is an

increasingly important public and political issue throughout the world and is important from both ethical and business perspectives. Animals in less stressful environments have better performance, a lower occurrence of disease and higher reproduction rates.

PerformancePerformance can be measured in many

ways and has many different definitions. At Novus, we focus on things that matter to our customers. Challenges that customers face can come from many directions: economic, the environment, competitors, regulators, consumers, and their own internal hurdles. Given the global nature of our business and variation of the issues across species we serve, Novus has many opportunities to help our customers.

How Novus helps customers

10 | NOVUS International

Novus’s business strategies and actions flow directly from the Vision, Mission and Core Values – this includes embedding sustainable prac-tices in every employee’s activities. Novus takes the industry’s challenges: performance, the environment, food safety, and animal wellbeing very seriously and as such, they form an integral part of our corporate objec-tives regarding growth, profit, people and reputation.

VisionTo help feed the world afford-able, wholesome food and achieve a higher quality of life.

MissionMake a clear difference in sustainably meeting the growing global needs for nutrition and health.

Core ValuesMaximize long-term customer satisfaction: anticipate their needs and exceed their expectations.Provide products with demonstrable value: research leading-edge concepts and supply preferred products and services.Act with integrity: treat all stakeholders – employees, customers, suppliers, business partners, our owners and the public – in a fair and ethical manner.Protect our employees, the public and the environment: make health, safety, security and environmental considerations a priority in all that we do.Seek excellence from all employees: expect and support alignment, diversity, individual growth, initiative and teamwork.

■

■

■

■

■

■

■

As we finish our first 17 years, we have created a global

organization with strong commitments to sustainable business

practices. We will continue to grow and expand, all while using our

Vision, Mission and Core Values as tools for aligning our activities

and improving our leadership role in the industry.

Vision for Sustainability

GrowthProfit

PeopleReputation

PerformanceEnvironmentFood Safety

Animal Wellbeing

Vision • Mission • Core Values

Novus’ business strategies and actions stem directly from the company’s vision, mission and core values. This includes

embedding sustainable practices in every employee’s activities.

Industry Challenges, Actions, and Future Plans | 11

At Novus, we believe in empow-ering those working in animal agriculture – from farm to table – with the tools and knowledge to make a positive impact in their local communities and the world. Our core vision: “help feed the world affordable, wholesome food and achieve a higher quality of life” helps us realize scientifically-based innovations that address the key challenges facing the global animal agriculture industry. Sustainability

Industry Challenges, Actions and Future Plans

Perf

orm

ance

Objectives:Focus on things that matter to our

customers because their challenges impede them from achieving optimal performance.

Address challenges that come from many directions and stake-holders: economic, environment, competitors, regulators, consumers and customers’ own internal hurdles.

Use and share knowledge and skills to improve performance against any number of factors, globally across all species served.

Highlights: 2007-08Partnered with the University

of Illinois to demonstrate the value of amino acid supplementation in commercial dairy herds and concluded that quality and volume of food could be increased while lowering the cost of production.

Developed the IDEA screening tool to enable producers who use Distillers’ Dried Grain with Solubles (DDGS) as a feed ingredient to easily and accurately test the nutritional value of the raw materials.

Launched Steadfast Equine, a total structural health supplement that helps horses of all ages maintain their peak performance and wellbeing.

Directions: 2009 and Beyond

Provide innovative health, nutrition, safety and quality solutions that improve performance and deliver benefits to our customers and their stakeholders.

Develop new and/or improved solutions that provide a higher ROI for our customers as well as sustainability characteristics.

Continue implementing the Novus Management System so we can improve our managerial leadership, which will result in improved performance for Novus and its customers.

Envi

ronm

ent

Objectives:Through scientific research and

development, create nutritional programs that reduce the environmental impact of animal agriculture.

Help producers meet the nutritional demands of modern livestock while balancing environmental concerns, including improved use and management of inputs and waste.

As feasible, protect the environment in all areas where we conduct business.

Highlights: 2007-08Successfully passed the Amer-

ican Chemistry Council’s Responsible Care audit of Novus’s headquarters and Chocolate Bayou sites - no major findings.

Invested $20 million in a new global headquarters and expansion of the Research Center, designed within the environmentally-focused framework of the U.S. Green Building Council’s LEED program.

Novus’s blending plant in Indaia-tuba, Brazil sustainably designed. Facility collects, cleans and or sepa-rates water, waste, and recyclables and minimizes energy use through smart control systems.


Long-term plans are to continue reporting using the GRI format, and continue to attain a high-level of disclosure across Novus’ s own operations.

Regularly review the opportunity to develop new sustainability projects in each of our world areas to develop win-win-win opportunities for Novus, our customers and other stakeholders.

Continue developing and investing in solutions that reduce consumption of natural resources, improve use or conversion of nutrients and reduce waste to the environment.


is about finding new ways of living, working and innovating that meet individual, business, and society needs without compromising the needs of future generations. We continually work as an orga-nization to assess how we can gear ourselves through innova-tive thought and action towards sustainable business practices and product offerings.

Food

Saf

ety

Objectives:Increase awareness and oppor-

tunities to improve management and control of food safety as it is a global public health issue.

Reduce the outbreaks of food-borne disease globally, by providing appropriate preventative and inter-vention-type products and advice.

Actively participate in the delivery of safe products to the public and help producers develop efficient systems to meet current and new regulatory food safety requirements.

Highlights: 2007-08Developed a test model with the

University of Georgia for measuring the effectiveness in reducing trans-mission of Salmonella in broilers. The tests showed organic acids are an efficient tool for improving food safety.

Grew ADVENT® sales in the poultry market for control of coccidiosis. ADVENT® coccidiosis control vaccine stimulates high protective immunity, reducing drug resistance and allowing antibiotic free production.

Introduced CapturaTM AF, a free flowing mycotoxin binder specifically designed for the African market to control aflatoxins in animal feed.


Deliver quality to our customers by being present for initial new product processing and trials at our customers’ locations.

Expand our geographic reach, especially in underserved markets, where we can improve animal agriculture and key aspects of food safety.

Continue to work with our network of partners and customers to understand their issues and develop solutions and programs that will improve food safety, globally.

Ani

mal

Wel

lbei

ng

Objectives:Ensure that our customers

understand all the resources Novus has to improve the wellbeing of farm animals.

Based on the local hierarchy of needs, work with producers to inte-grate valid, global public and political concerns as well as balance ethical and business perspectives.

Develop programs that provide less stressful environments for animals and this will result in better performance, a lower occurrence of disease, and higher reproduction rates.

Highlights: 2007-08Worked with customers in China

to reduce skin infections on poultry farms by using a combination of education, advice and training, resulting in better overall health and lower mortality rates.

Worked with producers to improve their sourcing by using IDEATM, a non-intrusive test kit devel-oped by Novus, to help producers determine amino acid digestibility of proteins for animal consumption.

Expanded sales of OASIS®

hatchling supplement, which is a hydrated nutritional formulation specially designed for the first days of life for poultry.


Our long term plans are to continue reporting using the GRI format, and eventually reach complete disclosures in all areas.

Work on establishing new tools for sharing Novus’s and our industry’s knowledge in a non-commercial setting.

Expand training and education efforts with universities and our customers in order to raise standards as well as gain insights to key global and regional issues facing them.

Critical Success Factors | 13

GrowthContinually assess and

develop our portfolio of products, customers and suppliers, and implement performance-enabling programs and technologies to achieve a long-term competitive position.

At Novus, we are constantly looking for new ways to grow our company responsibly and in line with our critical success factors. We endeavor to expand our product line with new products in new markets, and become even more sustainable in all that we do. The company’s growth will involve: partnerships and/or licensing agreements, acqui-sitions, organic development and geographic expansion.

As part of organic growth, our Research and Development depart-ment diligently works to create new products that are environmentally friendly yet deliver the best quality and economic returns possible. Our Marketing, Sales and Operations teams are exploring viable opportu-nities to meet the needs of currently underserved markets around the world. They do this by working with

partners to develop and innovate value chains, discovering new ways of improving the food supply. Our teams also identify methods to upgrade food quality and nutritional value in emerging economies.

One example of growth is through our partnership with Martek Biosci-ences Corporation. Novus sells their high-quality, all-vegetarian source of omega-3 fatty acids used for enrichment in food production. The product is a dried, non-GMO, whole-cell algae that offers an eco-friendly sustainable supply instead of relying on fish oil. It has a higher efficiency of DHA incorporation than fish oil. This makes it a more environmental source of DHA enrichment, and it still delivers the proven human health benefits of DHA.

Increase Animal-Based Food Supply

-To increase animal productivity while lowering operating costs.

To demonstrate the value of amino acid supplementation, Novus partnered with the University of Illinois to conduct field demonstra-tions in commercial dairy herds. The goal of the study was to explore the effect of simple methionine supple-mentation. The study concluded that a producer could generate a 5:1 increase in milk and milk components by following the Novus program. The program can help increase the quality and volume

Critical Success Factors

In order to grow responsibly, Novus identified four Critical

Success Factors — Growth, Profitability, People and Reputation

— that are the cornerstones in keeping our organization focused

on factors important to our stakeholders.


of food while lowering the cost of production. This makes wholesome food accessible to a greater number of people. Improving performance in animal agriculture and thus food’s affordability and accessibility is particularly important today, with increasing hunger becoming a more important global issue every year. Novus has practical experience in improving overall performance and reducing structural problems, increasing yield in both poultry and pork industries.

Food Safety- Helping build consumer trust

and confidence in contemporary food systems by sharing practical information with customers and consumers to help them under-stand how to prevent the spread of disease.

Novus is an active participant and Board Member of the Center for Food Integrity (CFI). The CFI is a

not-for-profit organization formed to build trust and confidence in the U.S. food system. It was formed to serve as a resource where consumers and other stakeholders could find accurate, balanced infor-mation about the food system and engage in constructive dialogue on important issues affecting the production and supply of food in the United States.

Globally, today’s food systems are comprised of many interdepen-dent segments, from the farmers and ranchers who grow and raise our food, to the processors and food companies that package food products, to the restaurants and retail outlets that make it available to consumers.

The food system is constantly changing and we want to provide information that helps consumers understand those changes and a forum for stakeholders to discuss them.

Novus and the CFI believe the entire system can learn from indi-vidual companies or associations that have embraced sound principles and model best practices in agri-culture. Sound principles and best practices can help the entire system improve performance and reduce the number of food safety incidents.

Novus acts as a guide and offers products, principles and best prac-tices that enable food chain partici-pants to meet regulatory challenges in their operations, and achieve profitable and responsible business solutions. Our involvement in the CFI underscores Novus’s commit-ment to provide sustainable solu-tions that positively influence the food chain, environmentally, socially, and economically.

Improved Sustainable Environment

-Help producers meet nutritional demands of modern livestock while balancing environmental concerns.

Minerals in the diet of farm animals are essential for optimum nutrition and performance, but they pose real environmental challenges. Many nutritionally-important minerals are very diffi-

Corporate Council on AfricaThe Corporate Council on Africa (CCA) is at the forefront of strength-

ening and facilitating commercial relationships between the United States and the African continent. CCA works closely with govern-ments, multilateral groups and businesses to improve Africa’s trade and investment climate, and to raise the profile of the conti-nent within the U.S. business community. CCA’s June program, “Investing in Agriculture Links in Africa,” brought together potential business partners and provides Novus an opportunity to develop a sustainable business in nations that will need to improve food quality and supply for nearly 1 billion people.

As a gold sponsor for the event, Novus hosted a workshop titled, “Education and Knowledge Building in Agriculture Production.” Novus brings together partners that are investing in reducing risk and expanding their business presence in Africa.

“At Novus, we work to empower emerging markets by transferring our knowledge in the latest research and technologies related to animal health and nutrition,” explains CEO Thad Simons. “The Corporate Council on Africa is providing a platform for this type of open knowledge exchange. We applaud their efforts and are proud to be in partnership.”

Thad Simons and United States Secretary of Agriculture Edward T. Schafer

Improving performance in animal agriculture and thus

food’s affordability and accessibility is particularly

important today.


cult to absorb through an animal’s digestive system. Novus created special formulations of organic trace minerals (OTM) that have high digestive absorption rates.

Novus’s OTMs are more bioavail-able to the animal at the point of absorption compared to other sources of trace minerals. This product provides higher mineral availability to the animal, better performance and a significant posi-tive financial impact for the farmer. Users reduce the amount fed to their animals, while getting better performance and a calculated ROI of about 5:1 from using Novus’s OTM solutions.

Novus’s mineral programs achieve farmers’ goals of animal performance and profitability with a positive environmental impact with reduced levels of minerals that enter the environment.

Amino acid nutrition is extremely important in protecting the environ-ment. Novus works with customers to develop feed formulations that deliver specific nutrients required by livestock. When the feed achieves this, the precise dosing results in a reduction in the amount of manure produced and minimizes the impact on the environment.

Novus is co-sponsor of the Responsible Nutrition Project with Sindirações, a trade organiza-tion in Brazil. This project brings together producers, academia and allied industry partners around nutritional strategies to reduce environmental impact of pork and poultry production. A Responsible Nutrition Guide combining the findings of the group’s research and practical suggestions to reduce nitrogen, phosphorus and trace mineral pollution is being finalized and is expected to be published in early 2009.

Reduced EnerGy Consumption

In 2007, Novus identified that one of its products, a key product in the performance management area, had more benefits than its intended use of moisture management through emulsification. Working with a German customer, we found that the product’s emulsifying action helped reduce their energy consumption at the feed mill. The resistance of the feed produced in the mixer/pelleter was lower and there was less wear and tear on their equipment.

profitablilityImplement improved busi-

ness processes, measures and supporting systems that will move Novus closer to its customers and deliver increased year-over-year market value.

Profitability is a key ingredient to sustainability as it is part of the triple bottom line that includes social and environmental factors.

Renewable Fuel Sources-Create solutions that help

producers get the maximum value of by-products from renewable fuel production.

Novus is developing technologies to help customers get maximum value of the by-products from renewable fuel production. Novus developed a screening tool to enable producers who use Distillers’ Dried Grain with Solubles (DDGS) as a feed ingredient to easily and accu-rately test the nutritional value of the product. DDGS, the by-product of corn-derived ethanol produc-tion, offers both opportunities and challenges for livestock producers. DDGS are an inexpensive livestock feed alternative, but their nutritional content is highly variable. In order to optimize muscle gain for a produc-er’s livestock, Novus developed a test kit that helps determine amino acid digestibility of DDGS. The result is more precise formulation of diets that improve profitability

Novus has implemented quality programs and maintains

traceability for the products we produce, so producers can rest

assured that the Novus products ingested by animals are safe.


by lowering feeding costs while reducing nitrogen excretion into the environment. Additionally, Novus offers a line of enzymes to make the DDGS more digestible.

Novus also recognizes that the issue of non-fossil energy sources is an important concern facing our global community. We have made

alternative fuels an area of strategic development and created a unique biodiesel stabilizer based on our deep knowledge of antioxidants. Novus’s biodiesel stabilizer prevents oxidation from exposure to air, heat, light, trace metals, and temperature variations - allowing customers to utilize biodiesel over a longer time period. This makes biodiesel a more practical alternative.

Use of Local By-products-Help producers greatly reduce

their operating costs through the use of local by-products and feed-stuffs that are of high quality with nutritional value.

The use of local by-products and feedstuffs can help producers greatly reduce their operating costs. However, one of the challenges is assuring the quality and nutritional value of these products. Novus helps by applying a deep knowledge of food quality control with the use of antioxidants. Our technologies help producers leverage local resources.

One example: Novus is helping aquaculture producers develop programs to support community-based fish meal production. The rapid growth of aquaculture as an industry has spurred the demand for, and price increases of, fish meal. Novus offers sustainable solutions that allow our customers to reduce fish meal use and offer improved animal nutrition. Novus’s platforms to improve lean muscle gain and gastrointestinal health of aquacul-ture resulted in the development of a product that partially substitutes fish meal without compromising performance. The fish meal is supplemented with a Novus product that is a source of methionine, organic calcium and organic acid to optimize overall performance at a lower cost. By leveraging Novus’s products and approach, fish meal that is both consistent in quality and affordable can be produced at the local level. Producers can also enjoy the business benefit of significantly reduced feed expenses because the transportation and possible importa-tion costs are reduced.

Fresh Water Conservation- Create new technologies to

protect water and its conservation.Aquaculture represents the

fastest growing sector of global food production and is highly dependent on the use of fresh water. Novus is contributing to the conservation of fresh water through our new aquaculture initiative that helps producers lessen the environmental impact of aquaculture.

For example, Novus developed an amino-acid based dietary supple-ment that makes feed highly digest-ible for carp, the most farmed fish species in the world. With the Novus solution, the level of undigested food passing into the water from

Novus: An Active Member of Key AssociationsName Description Role/ActivityACC American Chemistry Council Member

ADSA American Dairy Science Association Member

AFIA American Feed Industry Association Member and Committee Member

AGQMArbeitsgemeinschaft Qualitätsmanagement Biodiesel e.V. (Biodiesel Quality Management Association)

Member

CCA Corporate Council on Africa Member

CFI Center for Food Integrity Board Member

FAMI-QS Asbl Feed Additive and Premixture Quality System European Association Member

FEFANA EU Feed Additives & Premixture Association Member

GAA Global Aquaculture Alliance Member

NASC National Animal Supplement Council Member

NCC National Chicken Council Allied Member

NPPC National Pork Producers Council Member

PFI Pet Food Institute Associate Member

PSA Poultry Science Association Member

SSAFE Safe Supply of Affordable Food Everywhere, Inc. Member

UEP United Egg Producers Allied Member

WAC World Affairs Council Member

WAF World Agricultural Forum Board Member

WAS World Aquaculture Society Member


fish as pollution is reduced. From a business perspective, producers enjoy higher performance in their fish populations and improved feed costs through optimized rations. The result: better returns for farmers and less of an impact on the envi-ronment. Novus is also working on a complementary product line to improve water quality at the pond that will further contribute to fresh water conservation.

Novus also sees opportunities to improve conservation at its own facilities. Working together with the city of Indaiatuba, Brazil, Novus installed a system for collecting rainwater to be treated and reused by our plant and municipality. We are expecting to collect over 80,000 liters of rainwater per year.

Responsible Care ManaGement System (RCMS)

-A managed approach to environment, health, safety and security.

Novus is RCMS-certi-fied by the American Chemistry Council (ACC). Novus passed the RCMS, third-party audit of our Chocolate Bayou, Texas and Headquarter facilities. An RCMS framework helps deliver results in community awareness and emer-gency response, security, distribu-tion, employee health and safety, pollution prevention, process safety and product stewardship.

CertificationsChocolate

Bayou, Texas

Little Rock,

Arkansas

Gudensburg, Germany

Brussels, Belgium

Indaiatuba, Brazil

Shanghai, China

Headquarters, Missouri

FAMI-QS 4 4 4 4 4 4

GMP+ 4 4 4 4

ISO14000 4

ISO9001 4 4 4 4 4 4

NASC 4

Safe Feed/ Safe Food 4 4 EUREPGAP Iso22000

(HACCP)

Novus Receives NASC’s Best Manufacturing Practices Certification

Arenus joined the National Animal Supplement Council (NASC) in November 2006 and successfully completed the initial Best Manufacturing Practices Certification audit from NASC in June 2008. Arenus received an “A” in the audit, which is the highest possible rating. The NASC is a voluntary certification organization that provides guidance to the companion animal health products industry for compli-ance with regulatory standards. Members must demonstrate compliance by: using accurate labels with complete ingredient listings, not making unsubstantiated claims on labels or in advertisements, manufac-turing products under rigorous quality standards, and ensuring the safety of the the ingredients by tracking adverse events. Even though this certification is not obliga-tory to sell supplements in the companion animal industry, Novus completed this rigorous audit.


Product Stewardship ProGram

Product stewardship goes beyond just complying with envi-ronmental, health, safety and secu-rity (EHS&S) regulations. It expands the focus of an EHS&S program to include minimizing product risk from inception, past the point of sale to ultimate disposal. It emphasizes interaction with the customer to assure proper use and to learn more about possible health or environmental impacts. Our code provides a way to manage a product through its life cycle. It also encourages continuous improve-ment in the EHS&S fields, always looking for better ways to make a safer product, to educate our customers and to encourage their feedback about our products.

Novus has a product steward-ship risk evaluation and manage-ment system in place. Our practice is to evaluate products through all stages of their life cycle to be sure that they:

Deliver benefits to the end user. Are safe and environmentally sound. Meet product regulatory requirements of the countries in which we do business.

Novus conducts a formal Product Safety Assessment on most new or modified products. These assessments address matters such as determining a clear understanding of product characteristics and expected uses. The assessment also includes conducting a review of available health, safety, environmental, exposure and regulatory informa-tion. The nature of Novus’s busi-ness is such that many of our feed ingredient and vaccine products have been evaluated by the U.S. Food and Drug Administration (FDA), the U.S. Department of Agri-culture (USDA), the Association of American Feed Control Officials (AAFCO) or other appropriate agencies in the United States and other countries in which we manu-facture or market such products. Regulations on the use of such

■

■

■

products have been established – based on thorough evaluations of EHS&S data.

Potential risks are characterized, regulatory compliance is assured, and risk management practices are established where necessary and appropriate as an integral part of the decision on whether and how a product is marketed. The results of the Product Safety Assessment are communicated through Material Safety Data Sheets (MSDS), labels, and supplemental product steward-ship information as applicable.

Novus continues to monitor prod-ucts even after they are marketed. As new health and safety data or new product use and exposure informa-tion become available, the informa-tion is analyzed and adjustments are made to the Product Safety Assess-ment, if needed.

peopleProvide a healthy work-

life balance and accelerate development of employee programs that provide current and future opportunities for personal, professional and corporate growth, while adhering to our core values and management systems.

People are the core of our organi-zation. We empower our employees so we all have a shared sense of commitment to responsible behavior and business practices. In doing this, Novus endeavors to maintain open, honest and fair communication for the benefit of all stakeholders. Novus actively seeks out opportuni-ties and tries to create an environ-ment within the company that chal-lenges norms and keeps employees thinking forward in order to deliver fresh ideas.

LearninG & Individual Development

Manager Once Removed (MoR) Mentoring Process

Novus takes the individual devel-opment of its employees very seri-ously and therefore has instituted the MoR Mentoring Process. MoRs

Environmental Health, Safety, and Security (EHS&S)

Novus has a strong commitment to environmental responsibility, health, safety, and security. We responsibly design our manufacturing process, operational and transportation-related procedures with a focus on safety. Our record of protecting the public is bolstered by our strong ties to the communities in which we operate, and an active and open communication effort. We are dedicated to providing a safe and healthy workplace for all of our employees.

The dedication of Novus to protecting employees and maintaining the highest safety standards was recognized in 1996 when the U.S. Occupational Safety & Health Administration (OSHA) awarded our Chocolate Bayou manufacturing facility with the OSHA Star Award. This award, OSHA’s highest honor, recognizes outstanding safety and health standards. The Chocolate Bayou plant has retained OSHA Star status every year since 1996.

Novus believes that all injuries, as well as safety, environmental, secu-rity and transportation incidents, are preventable. As such, our goal for all is zero.Our manufacturing and research and development facilities have had no reportable environmental releases since the inception of Novus in 1991.There have been no reportable transportation incidents in the history of the company.

■

■

■


are accountable for establishing development plans for their Subordi-nates-once-Removed (SoRs). MoRs are directly concerned with the talent pool and the long-range develop-ment of their SoRs.

Through this mentoring process, MoRs work with each SoR individu-ally with regard to that person’s work future and career development, training and education, beyond that needed in his or her present role. SoRs discuss their aspirations and career opportunities within the company with their MoR, rather than their immediate managers.

Novus Learning SystemWe took steps over the

past year to finalize the Novus Learning System and implement it throughout the company. Our goal is to establish a learning culture that provides growth opportuni-ties to benefit individuals at Novus worldwide. We believe our system will enable our employees to be successful, while acting with integrity at all times. Novus held a week-long workshop with all of our managers and world area directors to discuss the new Novus Management System. This allowed management to learn new effec-tive leadership techniques that will help our company culture flourish. Furthermore, our integrity system ensures that all of our employees

are acting fairly and honestly.

LEED BuildinGNovus’s new global headquarters

is our symbol to the world and an expression of our sustainable efforts. The 90,000 square foot structure consolidates Novus’s headquarters and the Novus International Research Center. The structure is designed within the environmentally-focused framework of the U.S. Green Building Council’s Leadership in Energy and Environmental Design (LEED) certifi-cation. The global headquarters will accommodate many established and forward-thinking elements of sustain-able design and construction.

Our new global headquarters is also designed to give our employees the world-class facilities they deserve. Our building will capitalize on natural sunlight and circulates fresh air, conditions which appear to lead to a decline in illness and enhanced employee satisfaction. Studies have concluded that workers perform better with natural sunlight.2 This is just another step towards providing our people the best health standards available.

Renewable EnerGy Credits (RECs)

As a part of our ongoing commit-ment to implementing new sustain-able projects, Novus has invested in

Some examples of forward-thinking elements of sustainable design and construction found in our new global headquarters:

Raised floor system that is salvaged from another project.Landscape design requiring zero irrigation, equating to thousands of gallons of water saved each year.Skylights and floor-to-ceiling windows to maxi-mize the use of natural light.The use of rapidly-renew-able and recycled materials throughout.A storm water system that will greatly reduce the envi-ronmental impact of runoff and quality to streams and eventually the Missouri River.Many interior finish mate-rials manufactured with rapidly-renewable mate-rials and certified wood products.5,000 square feet of solar panels – currently, the largest array in the state of Missouri.

■

■

■

■

■

■

■


Renewable Energy Credits (RECs). Novus has purchased 100% of the energy we use in renewable energy credits at our new global headquar-ters in the Saint Louis, Missouri, area. We want to do our part as a global company by investing in renewable energy; therefore we buy the corresponding amount (1.4 million kilowatt-hours (KWH) per year) of renewable energy we spend at the facility. Each KWh of clean, renewable electricity reduces the need for an additional KWH of what is often pollution-causing conven-tional electricity. The energy we buy is then put back into the power grid, providing environmental benefits for everyone from this displacement of conventional power.

Support for CommunitiesNovus has a matching program

with its employees for contributions given to charities. We decided that contributions for the year would go to the United Way, which gives out money to various charities around the St. Louis community. People donate to the United Way for many reasons, but primarily to support our entire community by caring for one another. The United Way uses volun-teers and paid personnel to manage how the funds are distributed and to ensure that the supported orga-nizations use the money effectively. In 2007, Novus and its employees donated over $US 82,000 to the United Way.

The disasters that fell upon Myanmar and China in May 2008 were a reminder that we must act as a united community to help those in need. As a global company, we have operations in Asia and were dedi-

cated to providing whatever support we could to the victims of the tragedy. Novus employed a match-giving campaign with its employees that provided over $US 45,000 to the relief effort for those affected by the catastrophes.

reputationExpand on our positive

image by initiating and supporting activities and programs that demonstrate Novus’s integrity and aspi-rations to meet corporate objectives ever-more respon-sibly, in a sustainable manner.

Novus has earned a positive image in the industry by our dedi-cation to sustainability principles, by growing through science that creates products and services that help improve health and nutrition world-wide.

Novus InteGrity SystemIt is fundamental to the philos-

ophy of the Novus Vision that good ethics and good business are synonymous when viewed from moral, legal and practical stand-points. The Novus Integrity System (NIS) and its critical components are essential to our pursuit of the Novus Vision. The NIS, the Novus Management System, and Novus’s employee policies are reminders of Novus’s and each of its employee’s commitments to corporate and personal integrity.

Commitment to each other, to our customers, and to the public are key parts of our effort to make Novus a company we can all be proud of. The trust and respect of all people – fellow workers, customers, suppliers, the community, friends and the general public – are assets that cannot be purchased. They must be earned every day. That is why all of Novus’s business must be conducted according to the highest ethical, moral and legal standards.

The modern business environ-ment can present complex issues that challenge each of us to deter-mine the right course of conduct. Since the Novus Integrity System cannot address every issue that will

Direct Energy Consumption from January 2007-June 2008

Total Energy UsageMillion BTU

Total Energy UsageMillion KJ

Energy Use per KG of production (KJ per KG)

1,166,995 1,231,180 3,045

Total CO2 Emissions in Metric Tons from January 2007-June 2008Direct CO2 Emissions 8,722

Indirect CO2 Emissions from Electrical or Steam Supplier 54,704


arise, it is intended to provide the company with guidelines that will assist us in meeting these chal-lenges. We strive at all times to make decisions that are not only lawful, but also morally and ethi-cally sound.

Novus Sponsors Research and Shares KnowledGe World-Wide

Through partnerships with scien-tists and universities on a global scale, Novus engages in knowledge transfer that helps scientists and universities address local issues as well as to help Novus gain insights into world agriculture. Researchers in countries such as China and India help Novus learn through Novus grants on how to solve local chal-lenges. Novus can then use such understanding to determine how its products can help nations advance animal health and nutrition in a responsible way.

Graduate Scholars ProGrams

Novus Graduate Scholars (China)The Novus Graduate Scholars

(NGS) program was initiated in 2006 as a commitment by Novus to fund

four, two-year graduate scholarships at each of eight leading animal nutri-tion and health programs at univer-sities across China. The program is intended to contribute to the devel-opment of up-and-coming scientists in animal agriculture and further our knowledge-sharing commitment.

The goal: Create scientifically-based innovations to address key challenges facing animal agriculture. We feel a deep responsibility to transfer knowledge and technology to people around the world who can use it to improve farming practices in their local communities.

Purposes: Encourage students in animal agriculture to develop strong research programs, helping them gain an international perspective of agriculture. Help Novus learn more about agriculture in China. Gain understanding of the university system, the profes-sors and the students. Develop a network of technical collaborators to work with Novus in creating solutions for China’s animal agriculture challenges.

Novus Research Fellowship (China)The Novus Research Fellowship

■

■

■

■

Top: 2008 students from China engaging

in field work

Above: Dr. Ma Deying, 2008 Novus Re-

search Fellowship award recipient


(NRF), awarded annually, is a two-year grant made through a university department.

This award was created to support the development of inter-nationally competitive research programs with promising young scientists in China specializing in the field of animal nutrition and health. To qualify for the award, applicants must submit research proposals that are evaluated by a panel of renowned scientists.

The recipient of the 2008 NRF award was Dr. Ma Deying from the Institute of Animal Nutrition, North-east Agriculture University in Harbin, China. Dr. Deying’s winning proposal is related to alternatives to in-feed antibiotics in commercial poultry operations.

Joint Research Agreement & Student Scholarships — Bombay Veterinary College (India)

Novus is sponsoring three veteri-nary students to conduct a two-year research project on organic trace mineral nutrition in poultry produc-tion with local needs.

“Our partnership with Bombay Veterinary College links the scien-tific talents of Novus with one of the oldest institutions in Asia,” says Simons. “This is a great opportunity for both partners to collaborate in a way that is mutually beneficial and

encourages the continued growth of agriculture-related studies in the region.”

Auburn Research AwardThis annual award is presented

to an Auburn University graduate student for research excellence in one or more areas of animal nutri-tion, metabolism, growth and development of health and disease. The 2007 award is being offered to Elias J. Bungenstab, who is currently researching the effects of poultry litter fertilization in forage-based cattle feed. Elias exemplifies the type of candidate Novus is proud to present this award to. He not only gets assistance in his pursuit of a Ph.D., but is developing a sustainable solution for the beef cattle industry.

Novus Contributes to ImprovinG Animal WellbeinG Standards

- Help producers find ways to increase the wellbeing of farm animals; animals in less stressful envi-ronments have better performance, a lower occurrence of disease, and higher reproduction rates.

Animal wellbeing is an increas-ingly important public and political issue around the world from both an ethical and business perspective. Novus collaborates with producers throughout the world to raise the standards of animal wellbeing. As previously mentioned, Novus worked with a leading poultry producer in China to improve the quality of life for animals that were experiencing structural health issues related to growth weight.

In Southeast Asia, Novus has leveraged its expertise in poultry production and wellbeing to reduce problems associated with skin infec-tions that can dramatically impact both quality of life and animal health and performance. Through our expe-rienced and highly trained staff we were able to identify problems that led to a high incidence of skin infec-tions and provide training, advice, and nutritional tools to reduce skin infection problems by 15%. By reducing the incidence of skin infec-tions on-farm, these chickens had

2008 Novus staff and internship participants


better overall health with much less mortality.

High water quality is important for humans and animals alike. In China, Novus has taken a special interest in this need and created a program for education and imple-mentation of water quality plans with Nanjing Agricultural University. As a key member, a Novus presen-tation at the 2008 Animal Ecology Society Conference promoted the water quality program as it relates to animal wellbeing, health and subclinical loss. Novus now retains

executive membership with the National Animal Ecology Society, and has plans to continue to foster the growth of this program.

Globally, the quality of animal feed can be a major concern for animal wellbeing. Animal feed that has spoiled or is contaminated with naturally-occurring toxins can dramatically impact wellbeing and performance by making animals sick, more prone to diseases, or lead to developmental or structural problems. Novus has developed a suite of technologies that identify high quality ingredients, eliminate harmful substances from animal feeds, and preserve and protect feed from environmental factors that can damage the nutrients inside. Through these products and our expertise at applying them, Novus has had a positive impact on animal wellbeing and performance around the world.

Communication with Stakeholders

We understand that Novus has a responsibility to listen to all of its stakeholders in how we do business. For that reason, Novus has made it a priority to make communication with stakeholders an integral part of

all we do. Our goal is to improve our understanding of their needs and to make sustainability a reality in the world in which we operate.

We are currently working with a number of organizations to discuss sustainability issues. For example, we recently held our first sustain-ability roundtable and continue to take part in the World Agricultural Forum.

Novus participated in the 2007 World Agricultural Forum (WAF) held May 8 to10 in St. Louis. “Our mission at Novus aligns with the WAF goals and we are proud to support this unique and valuable organization,” says Novus CEO Thad Simons. The WAF Congress meets every two years in St. Louis, uniting global leaders of industry, government, civil society, and academia to iden-tify solutions to enable sustainable agri-systems capable of contributing to global economic development. The theme of the 2007 congress was “Creating Prosperity through Investments in Agriculture” and key discussions focused on infrastructure development, trade, water and bio-energy.

As an official sponsor and exhib-itor, Novus held it’s first-ever sustain-ability roundtable as part of the WAF. Novus held the “think tank” with over 40 executive-level members of the global animal agriculture industry and two members of the Interna-tional Finance Corporation’s (IFC) agribusiness department. The round-table helped establish the need for a balance between helping customers reduce their environmental footprint and reducing our own.

As part of our continued commit-ment to furthering the WAF’s mission, Novus provides financial assistance and helps provide over-sight in bringing in new members to carry out agricultural economic development throughout the world.

We work towards improving the quality of life within the communities we do business, because we are also a part of them.

Novus has made it a priority to make communication with

stakeholders an integral part of how we do business.


Novus exists because our stake-holders and health and nutrition customers exist. As a result, Novus continues to develop and provide innovative solutions that address the environmental, social, and economic issues they face in a sustainable manner.

One huge issue facing both Novus and the entire food production system – from poultry to aquaculture – is that global population is on the rise. In order to remain sustain-able, Novus must aspire to develop innovative products, programs, and solutions that positively impact the “triple bottom line.”

As demand for animal protein increases on a global scale, acting responsibly will have a positive influence on the environment, food safety, animal wellbeing and the performance of our customers as well as our own performance. Furthermore, acting responsibly will result in sustainable, long-term benefits for generations to come.

Because of actions we have taken to position our company in the past, we are able to respond to our goal of the triple bottom line today and into the future on a global scale.

Looking at additional actions we are implementing today, Novus looks forward to reporting on its perfor-mance again in 2009 and beyond.

Summary

Publishing a sustainability report is new for Novus, but

there is nothing new about Novus’s dedication to corporate

responsibility and sustainability. We’ve been an active

participant and supporter of sustainability efforts since our

company was formed 17 years ago. Over that period, our Core

Values have not changed. We remain dedicated to the triple

bottom line of environmental, social and economic factors in all

products we produce and solutions we provide for our customers

and stakeholders.

AAFCO: American Association of Feed Control Officials

CFI: Center for Food Integrity

CSR: Corporate Social Responsibility

DDGS: Distillers’ Dried Grain with Solubles

DHA: Docosahexaenoic acid, an omega-3 essential fatty acid

EHS&S: Environmental, Health, Safety & Security

FDA: U.S. Food and Drug Administration:

GMO: Genetically Modified Organism

GRI: Global Reporting Initiative

GMP+: Good Manufacturing Practices plus Hazard Analysis Critical Control Point (HAACP)

IFC: International Finance Corporation

ISO: International Organization for Standardization, a worldwide organization that develops many different kinds of standards9001: ISO 9001 is a procedural and documentation system that assures customers that a company has a good Quality Management System.14000: ISO 14000 is a procedural and documentation system and provides requirements for environmental management systems for organizations wishing to operate in an environmentally sustainable manner.

■

■

LEED: Leadership in Energy and Environmental Design

MoR: Manager Once Removed

MSDS: Material Safety Data Sheets

NGS: Novus Graduate Scholars

NHN: Novus Human Nutrition

NIS: Novus Integrity System

NNB: Novus Nutrition Brands

NRF: Novus Research Fellowship

NGOS: Non-Governmental Organizations

OSHA: U.S. Occupational Safety and Health Administration

OTM: Organic Trace Minerals

REC: Renewable Energy Credits

ROI: Return on Investment

SoR: Subordinate Once Removed

Abbreviations, References and Tables

Glossary and Abbreviations | 25

1 Gro H. Brundtland.2 Heschong Mahone Group, Inc. “Windows and Offices: A Study of Office Worker Performance and the Indoor Environment” – CEC PIER 2003.

Employee DataTotal Employees 401

Female Employees 149 (31%)

Male Employees 252 (69%)

Senior Management 31 people (8%)

Employees by RegionNorth America 180 45%

EAME 58 14%

Latin America - S 30 7%

Latin America - N 17 4%

China 63 16%

Australia 6 2%

Singapore 7 2%

APEC 40 10%

TABLES:

*Novus International does not condone or allow child labor or

any forced or compulsory labor in any of its operations around

the world

ABBREvIATIONS

REFERENCES:


GRI Index

Vision and Strategy1.1 A Message from the President Pages 6-7

Profile2.1 Name Novus International, Inc.; Page 3

2.2 Primary products Company profile: Pages 3-5

2.3 Operational structure of the company (divisions, subsidiaries) Pages 3-5

2.4 Location of headquarters Saint Charles, MO; Pages 3, 21-22

2.5 Countries of operation Company profile: Page 4

2.6 Nature of ownership Page 3

2.7 Markets served Company profile: Pages 3-5

2.8 Scale of organization Company profile: Pages 3-5

2.9 Significant changes New headquarters; Page 19

2.10 Awards received None

Report Parameters3.1 Reporting period 1 January, 2007-30 June, 2008; Pages 8-9

3.2 Previous report This is Novus’s first Sustainability Report ever; Pages 8-9

3.3 Reporting cycle Annual; pages 8-9

3.4 Contact point Contact us: Page 28

3.5 Process for defining report content Pages 8-9

3.6 Boundary of the report Pages 8-9

3.7 Any specific limitations of the report Pages 8-9

3.8 Basis for reporting on subsidiaries Page 9

3.10 Explanation of any restatements from previous reports None

3.11 Significant changes from previous reports None

3.12 GRI contents index This page

Governance4.1 Governance structure Pages 4-5

4.2 Chairman of Board different than CEO Yes; Page 5

4.3 Board Structure Page 5

4.4 How shareholder and employees provide recom-mendations to the board

Via executives; Page 5

4.14 List of stakeholder groups engaged by organization Page 16

4.15 Basis for identifying stakeholders to engage Page 23

GRI Index | 27

Key Performance IndicatorsEconomic Disclosures

EC2 Financial implications due to climate change Reference Feed International, July/August 2008.

EC7 Local recruitment Page 25 , The Novus policy is to hire locally in each area of the world we are located.

Environmental Disclosures

EN3 Direct energy consumption Page 20

EN16 Direct and indirect greenhouse gas emissions Page 20

EN19 Emissions of ozone-depleting substances Page 20

EN23 Total number and volume of significant spills Page 20 , No significant spills at our facilities. Small incidents related to transportation have been resolved quickly and in an environmentally respon-sible manner.

Social Disclosures

Labor Practices and Decent Work

LA1 Total workforce data Page 25

LA4 Collective bargaining agreements Novus has no employees covered by collective bargaining agreements.

Human Rights

HR6 Child labor Page 25

HR7 Forced or compulsory labor Page 25

Society

SO2 Analysis of risks related to corruption Page 5 , Deloitte and Touche LLP completed an anti-fraud assessment and found no deficiencies as of 31 March, 2008.

SO3 Employees trained in anti-corruption policies and procedures

Page 5 , The Novus Integrity System addresses “Prohibited Payments” and the “Foreign Corrupt Practices Act.” All employees receive training on the NIS policies, and are required to certify each year that they know of no violations with respect to the NIS policies.

SO5 Participating in public policy development and lobbying

Novus expressed concern regarding Docket ID No. EPA-HQ-OAR-2008-0380. We advised the U.S. Environmental Protection Agency (EPA) to take a balanced position on the Renewable Fuel Standard (RFS) mandate for the production of ethanol derived from grain. Novus suggested that the U.S. EPA should consider Governor Perry’s (Texas) petition and study his request to reduce the RFS by 50% for 2008. Competition between corn for ethanol for food or fuel was becoming intense and mandating levels of fuels derived from grains could have led to an allocation away from food, when demand for food was growing rapidly as well.

Product Responsibility

PR3 Product and service information and disclosures Pages 17-18 , 100% of our products are registered through government agencies throughout the world.

GRI Index


If you have comments on Novus’s Sustainability Report, or

would like further information, please follow the links on our

web site, www.novusint.com. Alternatively, you can contact

the Sustainability Report Team by sending an e-mail to

[email protected], or in writing at:

Novus International, Inc.20 Research Park DriveSt. Louis, MO 63304United States of America

Attn: Sustainability Team

Please provide your name, affiliation and postal and/or email address.

Copies of Novus’s Sustainability Report can be obtained electronically at www.novusint.com

Contact Us

Technology

2008 Novus Sustainability Report