Climate Change Data

Höganäs Holding AB

Climate Impact & Sustainability Data (2017, 2019, 2023)

Reporting Period: 2017

Environmental Metrics

Total Carbon Emissions:269,496 tCO2e/year (Scope 1)
Scope 1 Emissions:269,496 tCO2e/year
Scope 2 Emissions:103,000 tCO2e/year (estimated)
Scope 3 Emissions:Not disclosed
Renewable Energy Share:Not disclosed
Total Energy Consumption:Not disclosed
Water Consumption:1.7 million m3/year
Waste Generated:Not disclosed
Carbon Intensity:Not disclosed

ESG Focus Areas

  • Climate change
  • Responsible sourcing and use of materials
  • Workplace safety and employee well-being
  • Community engagement
  • Ethical business practices

Environmental Achievements

  • 7.1% reduction in energy use per produced tonne of metal powder within direct operations since 2010
  • 77% of all process-related residual materials were reused or found new use
  • Ground broken for a plant for production of renewable energy gas and green coke (Probiostål project), with the potential to decrease carbon dioxide emissions by around 10,000 tonnes per year

Social Achievements

  • Implemented a global incident reporting system and new targets for occupational health and safety work
  • 1,435 development talks between co-workers and managers (76% of all employees)
  • Launched a people satisfaction survey
  • Initiated a partnership with Plan International concerning water purification technology

Governance Achievements

  • Joined the UN Global Compact
  • Initiated a global climate roadmap
  • Implemented a tool for reporting group-wide sustainability data and key performance indicators (KPIs)
  • Conducted a pilot project for a supplier evaluation tool

Climate Goals & Targets

Long-term Goals:
  • Zero Accidents
  • Zero Waste (by 2026: >95% of side-stream materials reused)
  • Climate neutral operations
Medium-term Goals:
  • By 2020: Cobalt at max 0.02 mg/m3, nickel (metallic) at max 0.005 mg/m3; >85% of side-stream materials reused; replace >50% of process water requirement in India with rainwater
  • By 2021: all major production sites to certify energy management according to ISO 50001
Short-term Goals:
  • By 2019: all employees to have development talks; LTI frequency <3; average risk reduction of at least 1.5 points per employee and year

Environmental Challenges

  • Decreasing, but still unsatisfactory, number of safety incidents
  • Need to improve stakeholder dialogue in local communities
  • Need to strengthen supply chain management
  • Need for more thorough quantification of the environmental and social footprints of products
Mitigation Strategies
  • Implemented a global incident and risk reporting system (MIA)
  • Developed new targets for occupational health and safety work
  • Updated Code of Conduct for Suppliers and developed a supplier evaluation tool
  • Started systematic work with life cycle assessments (LCA)

Supply Chain Management

Supplier Audits: 25 on-site audits in 2017

Responsible Procurement
  • Code of Conduct for Suppliers
  • Supplier evaluation tool
  • Conflict Minerals Compliance Policy

Climate-Related Risks & Opportunities

Physical Risks
  • Not disclosed
Transition Risks
  • Not disclosed
Opportunities
  • Development of renewable energy technologies (Probiostål project)

Reporting Standards

Frameworks Used: GRI Standards Core option

Certifications: Null

Third-party Assurance: Internal audit

UN Sustainable Development Goals

  • Not disclosed

Not disclosed

Sustainable Products & Innovation

  • High-precision toolbox for iron-copper-carbon mixes
  • Powder metallurgy gears
  • SMC-based motors
  • Iron-based surface coating powders
  • Cleanit® water treatment media
  • Iron-based filler metals for stainless steel joints

Awards & Recognition

  • Not disclosed

Reporting Period: 2019

Environmental Metrics

Total Carbon Emissions:256,200 tCO2e/year
Scope 1 Emissions:256,200 tCO2e/year
Scope 2 Emissions:83,400 tCO2e/year (market-based) or 118,800 tCO2e/year (location-based)
Scope 3 Emissions:Not disclosed
Renewable Energy Share:1.2% of total fuel use; 50% of purchased electricity
Total Energy Consumption:417,100 MWh/year (fuels) + 486,200 MWh/year (purchased)
Water Consumption:6,866,000 m3/year
Waste Generated:611,500 tons/year (direct materials) + 6,400 tons/year (non-process waste)
Carbon Intensity:Not disclosed

ESG Focus Areas

  • Workplace
  • Society
  • Climate
  • Environment
  • Products

Environmental Achievements

  • Decreased direct emissions by almost 14,600 tonnes due to lower production volumes, investments, and energy efficiency improvements.
  • Avoided emitting 35,400 tonnes of carbon dioxide by actively choosing electricity from renewable sources.
  • Reduced waste sent to landfill by 93% at Abril Industrial Waxes.
  • Reached 80% of the target to turn 85% of process residual materials into useful products by 2020.

Social Achievements

  • Received the Industry Gender Equality Prize 2019.
  • Two production sites received ISO 45001 certification.
  • Implemented a new Code of Conduct with an extensive launch pack.
  • Five years without injuries in Busan, South Korea.

Governance Achievements

  • Board of Directors approved the Climate Roadmap 2045.
  • Formed a Sustainability Council to link sustainability targets with business development.

Climate Goals & Targets

Long-term Goals:
  • Become climate neutral by 2045.
Medium-term Goals:
  • Increase the percentage of secondary materials.
  • Achieve ISO 50001 certification for most energy-intensive units by the end of 2021.
  • Evaluate the upgraded system tool for calculating transport emissions in 2020.
Short-term Goals:
  • Not disclosed

Environmental Challenges

  • Fluctuating demand for metal powder due to economic uncertainties.
  • Slow progress towards zero accidents.
  • Need to increase the number of female co-workers.
  • Challenges in replacing fossil fuels with renewable alternatives.
  • Mapping upstream scope 3 emissions to identify areas for improvement.
Mitigation Strategies
  • Maintaining close customer relations.
  • Appointing a Global Safety Manager.
  • Initiatives to attract more women to the industry.
  • Collaboration with Cortus Energy to utilize the Woodroll® process.
  • Developing an upgraded system tool for calculating transport emissions.

Supply Chain Management

Supplier Audits: 34 audits including social criteria; 8 audits including environmental criteria in 2019

Responsible Procurement
  • Supplier Code of Conduct
  • Anti-corruption policies
  • Responsible Sourcing programme

Climate-Related Risks & Opportunities

Physical Risks
  • Not disclosed
Transition Risks
  • Not disclosed
Opportunities
  • Development of energy-efficient products
  • Use of renewable energy and fuels
  • Increased use of recycled materials

Reporting Standards

Frameworks Used: GRI Standards: Core option, UN Global Compact

Certifications: ISO 14001 (most production units), ISO 45001 (two sites in 2019)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

  • SDG 5
  • SDG 6
  • SDG 7
  • SDG 8
  • SDG 9
  • SDG 10
  • SDG 12
  • SDG 13
  • SDG 16

See Sustainable Development Goals Reference in Appendix.

Sustainable Products & Innovation

  • Petrit® E and Petrit® T (made from slag)
  • BrazeLet® 9007/9017 (water-based pastes for brazing)

Awards & Recognition

  • Industry Gender Equality Prize 2019

Reporting Period: 2023

Environmental Metrics

Total Carbon Emissions:203,300 tCO2e/year (Scope 1 & 2)
Scope 1 Emissions:202,400 tCO2e/year
Scope 2 Emissions:0 tCO2e/year (100% fossil-free electricity)
Scope 3 Emissions:419,900 tCO2e/year (upstream)
Renewable Energy Share:32% (incl. sold)
Total Energy Consumption:773,700 MWh/year
Water Consumption:7,200 m3/year
Waste Generated:26,800 tons/year (to disposal)
Carbon Intensity:72% in 2023 (indexed to 2018)

ESG Focus Areas

  • Climate
  • Environment
  • Products
  • Workplace
  • Society

Environmental Achievements

  • Reduced Scope 1-2 emissions by 46% since 2018
  • Reached 100% fossil-free electricity in 2023
  • Increased share of biogas in processes
  • Successfully tested biochar as a reducing agent, reducing process carbon emissions by 17% in a one-month trial

Social Achievements

  • Launched 'Grow with Höganäs' career development framework
  • Launched 'Sustainable workplace for everyone' e-learning course on diversity and inclusion
  • Organized fourth consecutive Global Safety Week
  • Introduced Safety walks by leadership

Governance Achievements

  • Performed a double materiality assessment in preparation for CSRD
  • Took first steps towards implementing the EU’s new Corporate Sustainability Reporting Directive (CSRD)
  • Conducted integrity audits prior to signing new contracts with agents

Climate Goals & Targets

Long-term Goals:
  • Net-zero emissions across value chain (Scope 3) by 2037
  • 90% reduction in absolute scope 1, 2 and 3 GHG emissions by 2040 (SBTi)
Medium-term Goals:
  • Net-zero emissions across operations (Scope 1 and 2) by 2030
  • 90% reduction in Scope 1 and 2 emissions (local action plans)
  • Increase share of female co-workers to 20% by 2026
  • Increase share of female executive managers to 35% by 2026
  • 100% of key suppliers rated as ‘good’ or ‘excellent’ by 2026
  • 95% of process residuals put to use by 2026
Short-term Goals:
  • Improve health and safety performance
  • Continue executing on climate roadmap
  • Implement new organization
  • Develop new products for battery electric drivetrains

Environmental Challenges

  • Unsatisfactory workplace health & safety performance
  • Lower demand and production volumes due to economic uncertainty (war in Ukraine, inflation, high interest rates)
  • Transition to electric vehicles disrupting the automotive industry (main customer segment)
  • Customers setting ambitious Scope 3 emissions reduction targets
  • Sourcing high-quality biochar in sufficient quantities
Mitigation Strategies
  • Restructuring the company into five global divisions
  • Implementing initiatives to improve workplace health and safety (addressing identified behavioral issues)
  • Developing new products for battery electric drivetrains (reduction gears and electric traction motors)
  • Advancing position in the automotive value chain to develop relationships with OEM designers
  • Working with Life Cycle Assessments to provide sustainability performance data for products
  • Testing replacements for conventional reducing agents with alternatives like biochar
  • Inviting prospective suppliers and peers to biochar trials to raise awareness and encourage supply

Supply Chain Management

Supplier Audits: 78% of key suppliers rated as ‘good’ or ‘excellent’

Responsible Procurement
  • Supplier questionnaires
  • Supplier Code of Conduct
  • Assessment of human rights risks, conflict minerals risks, and corruption risks
  • Prioritization of local suppliers

Climate-Related Risks & Opportunities

Physical Risks
  • Floods and droughts
Transition Risks
  • Investing in the wrong technology
  • Higher costs
  • Not achieving goals on time
  • Lack of industrialised methods for fossil-free sponge iron production
Opportunities
  • Development of energy-efficient products
  • Growth in electric vehicle sector

Reporting Standards

Frameworks Used: GRI Standards 2021, Science Based Targets initiative (SBTi)

Certifications: ISO 14001, ISO 45001, ISO 50001 (six out of ten energy intensive sites)

Third-party Assurance: PwC (limited assurance on consolidated carbon footprint)

UN Sustainable Development Goals

  • SDG 7
  • SDG 13
  • SDG 5
  • SDG 8
  • SDG 10
  • SDG 6
  • SDG 9
  • SDG 12
  • SDG 16

Initiatives contributing to various SDGs are described throughout the report.

Sustainable Products & Innovation

  • Soft magnetic composite powders
  • Products for electric vehicle applications
  • Metal powders for additive manufacturing

Awards & Recognition

  • Gold Sustainability Award from the European Powder Metallurgy Association