Climate Change Data

Environmental Metrics

ESG Focus Areas

• Governance
• Environment
• Social
• Health and Safety
• People

Environmental Achievements

• Achieved ISO 14000 certification for the Zary plant's environmental management system.
• Set a CO2 neutrality target for the Uusikaupunki car plant by the end of 2021.
• Reduced energy consumption by about 1% at the Uusikaupunki plant and 13% at the Roof & Kinematic Systems business line despite production records.
• Switched the Uusikaupunki plant to fossil-free electricity from March 2020, reducing CO2 emissions by almost 50%.
• Reduced non-hazardous waste by more than 30% compared to 2018.
• Reduced water consumption by approximately 5 percent from 2017–2018.

Social Achievements

• Opened Finland's first high-volume production capacity battery plant in Salo.
• Decreased the number of work accidents at the Uusikaupunki plant by 30% compared to 2018.
• Released a Supplier Code of Conduct.
• Introduced the 5 Commitments to build a uniform corporate culture.
• Launched a training program for all employees on the 5 commitments.
• Introduced a WhistleB reporting channel for anonymous reporting of ethical violations.

Governance Achievements

• Renewed Valmet Automotive’s common ethical operating principles.
• Built an anonymous reporting channel for suspected violations of the Code of Conduct.
• Updated guidelines on data protection and security.
• Started building a group-wide sustainability strategy and targets for 2020–2027.

Climate Goals & Targets

Environmental Challenges

• High employee turnover rate in Finland.
• Lack of communication, processes, leadership, and departmental silo mentality.
• Difficulties in predicting the need for labor force.
• Uncertainty about the future of private motoring and increasing competition in the automotive industry.
• Need to update the skills and knowledge of current personnel with expertise in electric vehicle systems.

Mitigation Strategies

• Introducing the 5 commitments to build a uniform corporate culture with consistent leadership and processes.
• Developing leadership practices.
• Increasing the balance between home and work by providing opportunities for sports and recreational activities.
• Providing opportunities for employee career progression and skill development.
• Implementing a Supplier Code of Conduct to address environmental and human rights concerns in the supply chain.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Code of Conduct introduced in 2019, covering all direct procurements.

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Uncertainty about the future of private motoring and increasing competition in the automotive industry.

Opportunities

• Rapid transition toward e-mobility opening new business opportunities.

Reporting Standards

Frameworks Used: GRI Standards (Core option)

Certifications: ISO 14000 (Zary plant)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 8: Decent Work and Economic Growth
• Goal 9: Industry, Innovation and Infrastructure
• Goal 12: Responsible Consumption and Production
• Goal 13: Climate Action

The 5 Commitments are closely connected to SDG 8. The company contributes to SDG 9 through utilizing new technologies and implementing environmentally sound technologies and processes. SDG 12 is addressed through efficient use of natural resources and waste reduction. SDG 13 is addressed through CO2 neutrality targets and reduction of greenhouse gases.

Sustainable Products & Innovation

• 48-volt batteries

Awards & Recognition

• Not disclosed

Environmental Metrics

ESG Focus Areas

• Sustainability
• Governance
• Environment
• Health and Safety
• People

Environmental Achievements

• Reduced CO2 emissions by 70% from own operations compared to 2019 levels.
• Transitioned to renewable electricity at Zary and Uusikaupunki plants and renewable district heating at Uusikaupunki plant.

Social Achievements

• Zary plant employees sewed 12,000 face masks for hospital staff.
• Developed occupational safety by encouraging employee safety observations (one per employee on average).

Governance Achievements

• Released Valmet Automotive Group's first sustainability report.
• Reported to the Global CDP (formerly Carbon Disclosure Project) on climate work for the first time.

Climate Goals & Targets

Environmental Challenges

• Plant closures for four to six weeks due to the Corona pandemic.
• Supply chain disruptions due to the pandemic.
• Predicting labor force needs.
• Competition in the automotive industry.
• Transition to e-mobility requiring resources.

Mitigation Strategies

• Quick production resumption after closures.
• Special deliveries to keep customer production lines running.
• Special safety measures and constant contact with partners.
• Introduced masks in production early.
• Strategic cooperation with educational institutions.
• Active participation in EU initiatives (e.g., IPCEI).

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Code of Conduct

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Future of private motoring
• Competition in automotive industry

Opportunities

• Rapid transition toward e-mobility opening new business opportunities.

Reporting Standards

Frameworks Used: GRI

Certifications: ISO 14001, ISO 45001

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 8: Decent Work and Economic Growth
• Goal 9: Industry, Innovation and Infrastructure
• Goal 12: Responsible Consumption and Production
• Goal 13: Climate Action

Not disclosed

Sustainable Products & Innovation

• Not disclosed

Awards & Recognition

• National energy efficiency award (2017)

Environmental Metrics

ESG Focus Areas

• Environment
• Social
• Governance

Environmental Achievements

• Reduced CO2 emissions by 80% from own operations since 2019
• Achieved CO2 neutrality in own operations from the beginning of 2022
• Transitioned to fossil-free electricity at several locations
• Built a terminal for renewable energy, reducing energy consumption and improving energy efficiency in Uusikaupunki
• Shifted company cars to full EVs
• 61% recycling rate of waste
• 47% decrease in CO2 emissions from own operations (scope 1 & 2) compared to 2020

Social Achievements

• 73% positive feedback from employees regarding the company's commitment to its 5 commitments
• Avoided any COVID-19 contagion chains throughout the pandemic through systematic and proactive work
• Started supply chain sustainability assessments using a self-assessment questionnaire sent to targeted suppliers
• Employees represent 70 different nationalities

Governance Achievements

• Improved CDP Climate Change score to Management Level (B)
• Renewed vision and mission to contribute to climate protection and a truly green world
• Implemented Supplier Code of Conduct
• Started Scope 3 emission calculations

Climate Goals & Targets

Environmental Challenges

• Component shortage in the industry
• Lack and delays of components, especially semiconductors
• Heavy workload in some areas
• Finding a partner for recycling textile waste in Poland
• Mapping and managing specific climate-related risks and opportunities more systematically
• Managing human rights issues in raw material sourcing
• Developing systems for supply chain management for battery production
• Attracting a skilled workforce in all locations

Mitigation Strategies

• Proved flexibility in adapting to changing situations and reacting quickly
• Rethinking meeting practices to reduce workload
• Finding a partner who processes textile waste into RDF fuel
• Investing in purchasing renewable electricity and energy and replacing fossil fuels with renewable energy
• Investing in energy-efficient production processes and energy-saving equipment
• Calculating and reducing CO2 emissions in the value chain
• Implementing a hybrid working model for office personnel
• Developing a salary matrix for different job positions to enhance transparency in career paths

Supply Chain Management

Responsible Procurement

• Supplier Code of Conduct
• Sustainability criteria integrated into procurement
• CO2 emissions as one selection criteria for suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Power outages
• Extended drought periods
• Hot summers affecting production conditions and employee health and safety

Transition Risks

• EU regulation
• Keeping up with fast-developing battery technology
• Emission taxation and regulation affecting passenger car sales

Opportunities

• E-mobility
• Development of energy-efficient products
• New technological solutions leading to reduced energy consumption

Reporting Standards

Frameworks Used: GRI Standards: Core

Certifications: ISO 9001, ISO 14001, ISO 45001, ISO 27001, IATF16949

Third-party Assurance: Third-party assurance for scope 1 & 2 CO2 emissions

UN Sustainable Development Goals

• Goal 9
• Goal 12
• Goal 13
• Goal 8

Valmet Automotive's strategy and operations are centrally linked to these goals.

Sustainable Products & Innovation

• Modular Power Pack
• Aero efficiency solutions

Environmental Metrics

ESG Focus Areas

• Ensuring resilient & profitable business
• Strengthening integrity & dignity
• Respecting planetary boundaries

Environmental Achievements

• Achieved CO2 neutrality for own operations (scope 1 & 2)
• Reduced CO2 emissions from own operations (scope 1 & 2) by 80% since 2019
• Recycling rate of waste 64%

Social Achievements

• Improved group-level accident rate (LTIF) from 14.1 to 9.4
• Reduced injury rate in Vehicle Contract Manufacturing (VCM) by 42%
• Employed around 150 Ukrainians

Governance Achievements

• Launched the True Green Initiative
• Committed to setting science-based climate targets in line with the Science Based Targets Initiative
• Created a policy for the CEO’s and board members’ remuneration

Climate Goals & Targets

Environmental Challenges

• Global crises significantly affected the automotive sector and component availability
• Supply chain disruptions due to the war in Ukraine and Covid-19 lockdowns in China
• Increased safety risks in battery production due to handling of high-voltage systems

Mitigation Strategies

• Reacted quickly to sudden changes in the market
• Added resources for communication with clients and suppliers
• Rigorously updated Valmet Automotive’s safety practices and instructions
• Increased internal training

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier Code of Conduct (SCoC)
• Supplier self-assessment questionnaire (SAQ)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather events
• Extended drought periods
• Hot summers

Transition Risks

• EU regulations on internal combustion engine vehicles
• Energy cost volatility

Opportunities

• Green financing opportunities
• Technological developments in e-mobility

Reporting Standards

Frameworks Used: GRI

Certifications: ISO 14001, ISO 45001, IATF 16949

Third-party Assurance: DNV Business Assurance Finland Oy Ab

UN Sustainable Development Goals

• Goal 9
• Goal 12
• Goal 13
• Goal 8

The company's strategy and operations align with these goals through initiatives related to resilient infrastructure, sustainable industrialization, climate action, and economic growth.

Sustainable Products & Innovation

• Modular Power Pack battery system for heavy-duty vehicles
• Battery systems for electric vehicles

Awards & Recognition

• Not disclosed