Climate Change Data

Environmental Metrics

ESG Focus Areas

• Sustainability
• Environment
• Social Responsibility
• Business Ethics
• Responsible Purchasing

Environmental Achievements

• Reduced carbon emissions from asphalt production in the Nordic region by 12,600 tons through recycled asphalt and increased production of NCC Green Asphalt.
• Recycled asphalt granulate accounted for 15 percent of hot asphalt production.
• Developed a method for fueling asphalt plants using wood pellets, minimizing emissions and consumption of fossil fuels.

Social Achievements

• Launched a Group-wide program for responsible transactions and business ethics.
• Launched a Group-wide HR program.
• Improved employee satisfaction (HCI index rose to 73 from 72), increased employee recommendations (index rose to 80 from 79), and improved satisfaction with management (index rose to 74 from 73).
• Implemented Awareness Day for all employees to discuss health and safety issues, resulting in over 1,100 development proposals.

Governance Achievements

• Established a new position as Senior Vice President Sustainability for the Group.
• Further developed its compliance program, launching a Group-wide process in 2013 to prevent improprieties and introduce systems support for reporting improprieties.

Climate Goals & Targets

Environmental Challenges

• Continuing European debt crisis and weaker growth in most markets.
• Cautious housing market in Sweden and Finland.
• Challenging market conditions in Denmark.
• Weak economy in Finland.
• High level of job mobility among production personnel.
• High environmental impact of the construction and civil engineering sector.
• Risk of errors in profit recognition due to the percentage-of-completion method.

Mitigation Strategies

• Efforts to develop industrial construction processes and concepts (e.g., NCC Folkboende rental housing concept).
• Developing sales processes and gaining better insight into customer's business to offer more efficient solutions.
• Strengthening market position in Norway.
• Focusing on cost reductions.
• Capitalizing on Group synergies.
• Implementing Green Construction concept.
• Implementing Green Tenders.
• Focusing on skills development in project development, platforms, and VDC.
• Implementing risk management based on methodical and well-functioning joint business systems.
• Developing platforms for standardized solutions.
• Implementing a systematic approach to health and safety encompassing all processes.
• Arranging Awareness Day for all employees to discuss health and safety issues.
• Implementing a Group-wide strategy for environmental efforts with clear objectives and targets for 2020.
• Focusing on phasing out hazardous substances from production by 2020.
• Focusing on resource efficiency throughout the product development process and working towards more circular material flows.
• Implementing a methodical project management model for profit recognition.

Supply Chain Management

Responsible Procurement

• Group-wide purchasing
• Increased centralization and coordination of purchasing
• Larger share of international purchasing
• Thorough supplier assessment of products and services
• Demands on suppliers to respect freedom of association and the rights of employees.

Climate-Related Risks & Opportunities

Opportunities

• High demand for energy-efficient solutions

Reporting Standards

Frameworks Used: GRI

Certifications: ISO 14001

Sustainable Products & Innovation

• NCC Green Asphalt
• NCC Recycling
• NCC Spuma (biological weed control)
• Products made from bentonite
• Wood pellet fuel for asphalt plants

Awards & Recognition

• Award for the most energy-efficient building in Riga, Latvia

Environmental Metrics

ESG Focus Areas

• Health and Safety
• Social inclusion
• Materials and Waste
• Climate and Energy
• Compliance
• Portfolio performance

Environmental Achievements

• Reduced greenhouse gas emissions from own operations by 37% since 2015.
• Reduced total amount of waste by 25% compared with 2015 and 7% compared with 2018.
• Reduced amount of waste per SEK 1 M turnover from 1.64 tons/SEK M in 2015 to 1.14 tons/SEK M in 2019 (31% reduction).
• Recycled asphalt granulate accounted for 25% of hot asphalt production.
• 92% of all electricity purchased was eco-labeled or origin-labeled using guarantees of origin. Fossil-based electricity reduced by 90% since 2015.
• Six fossil-free worksites in Norway.

Social Achievements

• Accident frequency declined from 9.5 in 2018 to 7.0 in 2019.
• Launched 'Socialt hållbara projekt' (Socially sustainable projects) concept.
• Implemented a Code of Conduct for suppliers.
• Participation in the 'Tekniksprånget' internship program.
• Value-based workshops attended by nearly half of employees in NCC Infrastructure in Sweden and NCC Building Sweden.

Governance Achievements

• Implemented a Code of Conduct for suppliers.
• Developed NCC Compass, a support tool for managers and employees to make ethical decisions.
• 1,900 employees received compliance training and 1,500 received GDPR training.

Climate Goals & Targets

Environmental Challenges

• Climate change affecting supply, price, and availability of raw materials, fuel, and other resources.
• Climate change leading to changed construction processes and conditions.
• Risk of flooding, erosion, and earthquakes impacting employee safety and material storage.
• Risks of human rights crimes in NCC’s value chain, particularly at the purchasing level in risk areas.

Mitigation Strategies

• Long-term reduction of climate impact, phasing out fossil fuels, and moving towards a more circular use of raw materials.
• Risk assessments of all projects.
• Thorough process for supplier assessment in third countries, including assessing and ensuring that NCC does not do business with suppliers who do not respect human rights.
• Developing safety barriers to separate people from the risk of an accident.

Supply Chain Management

Responsible Procurement

• Code of Conduct for suppliers
• Supplier assessment before cooperation commences (scope varies by supplier type)
• One- to three-year supplier-assessment and supplier-performance audit cycle for non-Nordic suppliers.

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather
• Flooding

Transition Risks

• Changes in supply, price, and availability of resources due to climate change and future taxation.
• Changed construction processes and conditions due to climate change.

Opportunities

• Demand for new business models (digitization and sharing services)
• Demand for more sustainable products and services.

Reporting Standards

Frameworks Used: GRI Standards Core, UN Global Compact

UN Sustainable Development Goals

• Goal 7
• Goal 9
• Goal 11
• Goal 12
• Goal 3
• Goal 6
• Goal 13
• Goal 14
• Goal 15
• Goal 4
• Goal 5
• Goal 8
• Goal 10
• Goal 16
• Goal 17

NCC's operations contribute to these goals through various societal solutions, resource efficiency, building resilient societies, enhancing knowledge and expertise, promoting equality, decent labor conditions, economic growth, and cooperation with stakeholders.

Sustainable Products & Innovation

• NCC Green Asphalt
• NCC Machine Sand
• NCC Armour Stone
• NCC DrænStabil
• NCC ViacoQuiet

Environmental Metrics

ESG Focus Areas

• Health and Safety
• Climate and Energy
• Social Inclusion
• Materials and Waste
• Compliance
• Portfolio Performance

Environmental Achievements

• Reduced climate impact of asphalt production by 43% through switching to renewable fuels.
• Reduced construction waste by 29% compared with 2015 and 5% compared with 2019.
• Reduced greenhouse gas emissions from own operations by 42% since 2015.
• Recycled asphalt granulate accounted for 26% of hot mix asphalt production.

Social Achievements

• Accident frequency declined from 7.0 in 2019 to 6.7 in 2020.
• Launched value-based workshops to promote diversity and inclusion.
• Increased the proportion of pallets resold to the Byggpall returnable system.

Governance Achievements

• Updated Code of Conduct for suppliers.
• Conducted training in compliance and anti-corruption for 1,022 employees.
• Investigated six cases of suspected corruption, with one leading to an employee's departure.

Climate Goals & Targets

Environmental Challenges

• Reducing Scope 3 emissions (indirect emissions from purchased material and external services).
• Achieving a 70% sorting target for waste.
• Managing risks related to climate change, such as extreme weather and flooding.

Mitigation Strategies

• Initiated work to set targets and systematically measure parts of Scope 3 emissions.
• Implemented various initiatives to reduce waste and increase sorting rates.
• Performed risk assessments of all projects to manage risks related to climate change.

Supply Chain Management

Responsible Procurement

• Code of Conduct for Suppliers
• Supplier assessments (social and environmental)

Climate-Related Risks & Opportunities

Physical Risks

• Extreme weather
• Flooding

Transition Risks

• Changes in supply, price, and availability of raw materials; future taxation of fuel, energy, or carbon dioxide.

Opportunities

• Demand for sustainable products and services; development of climate-resilient products.

Reporting Standards

Frameworks Used: GRI Standards Core, UN Global Compact

Certifications: ISO 45001 (partially)

UN Sustainable Development Goals

• SDG 3
• SDG 6
• SDG 7
• SDG 9
• SDG 11
• SDG 12
• SDG 13
• SDG 14
• SDG 15
• SDG 4
• SDG 5
• SDG 8
• SDG 10
• SDG 16
• SDG 17

NCC has selected four SDGs where the Group has the greatest potential to contribute through various societal solutions, and another 11 SDGs that are fundamental to our operations and for the Group’s offerings.

Sustainable Products & Innovation

• NCC Green Asphalt
• NCC Machine Sand
• NCC Armour Stone
• NCC DrænStabil
• NCC Kielo

Environmental Metrics

ESG Focus Areas

• Climate Change
• Biodiversity
• Circular Economy
• Health and Safety
• Diversity and Inclusion
• Ethics and Compliance
• Economic Performance

Environmental Achievements

• Reduced emission intensity by 41% compared to 2015 (Scope 1 and 2)
• Increased renewable electricity share to 95%
• Increased share of renewable fuels
• Reduced carbon emissions related to purchases of electricity, district heating, and district cooling due to energy efficiency improvements
• Formulated an internal roadmap for climate-neutral concrete-based construction
• Reduced climate impact of the Kungsörnen project by nearly half through concrete optimization
• Converted all asphalt plants in Sweden to biofuel
• Reduced energy consumption at Danish construction sites by 50% outside working hours using IoT solutions
• Increased use of recycled asphalt to 26% of total production
• Received 493 ktons of material for reuse and recycling (excl. asphalt) and sold 738 ktons of recycled materials (excl. asphalt)

Social Achievements

• Launched a new focus for health and safety work aiming to eliminate serious incidents and fatal accidents
• Implemented workshops on Star behaviors for 75% of employees
• Updated diversity and inclusion targets
• Defined a new Employer Value Proposition
• Improved employee engagement over the past three years (based on employee surveys)

Governance Achievements

• Updated sustainability framework
• Reported climate risks and opportunities according to the TCFD framework
• Complied with the EU’s Taxonomy
• Implemented Ask Me and Tell Me functions for reporting suspected violations of the Code of Conduct
• Provided compliance, anti-corruption, competition law, and GDPR training to employees
• Increased number of suspected violations of the Code of Conduct reported (viewed as positive due to improved guidelines and communication)

Climate Goals & Targets

Environmental Challenges

• Supply chain disruptions due to climate events (implied)
• Increased price for carbon emissions and raw materials
• Increased climate-related regulation of buildings and infrastructure
• Increased demand for sustainable products and services
• Changes in access to capital due to climate-related regulations
• Physical risks such as floods, erosion, and extreme weather events
• Increased complexity of construction projects
• Shortage of physical space at certain asphalt plants limiting biofuel conversion
• Supply of wood pellets and challenging geography limiting biofuel conversion in Norway

Mitigation Strategies

• Actively replacing fossil fuels with renewable alternatives in asphalt production
• Implementing energy-efficiency initiatives
• Increasing the amount of recycled stone materials and asphalt in production
• Securing resources for the development of tools and work methods, and digitalizing operations
• Focusing on transitioning toward a reduced dependency on fossil fuels
• Developing materials and products that help society adapt to climate change
• Conducting risk assessments of all projects
• Implementing action plans and processes for data collection on transport emissions
• Optimizing loading work at construction and civil engineering projects
• Investigating the potential to convert from natural gas to biogas at asphalt plants in Denmark

Supply Chain Management

Supplier Audits: 8 framework agreement suppliers third-party audited; ~110 audits of non-Nordic suppliers (including 25 new suppliers)

Responsible Procurement

• Code of Conduct for suppliers
• ISO 9001/14001 certification for major framework agreement suppliers
• Amfori BSCI membership

Climate-Related Risks & Opportunities

Physical Risks

• Floods
• Erosion
• Earthquakes
• Extreme weather events
• Damage to inventories, materials, and structures

Transition Risks

• Increased price for carbon emissions and raw materials
• Increased climate-related regulation of buildings and infrastructure
• Changes in access to capital due to climate-related regulations
• Increased demand for sustainable products and services

Opportunities

• Increased demand for sustainable products and services
• Increased demand for products and services connected to climate adaptation
• Opportunities to remain at the cutting edge in the transition from fossil fuels to electricity or renewable fuels
• Opportunities to capture market shares by offering buildings with higher climate performance

Reporting Standards

Frameworks Used: GRI Standards Core option, TCFD, EU Taxonomy, UN Global Compact

Certifications: ISO 14001, ISO 90001, ISO 45001 (some units)

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Goal 7: Affordable and clean energy
• Goal 9: Industry, innovation and infrastructure
• Goal 11: Sustainable cities and communities
• Goal 12: Responsible consumption and production
• Goal 3: Good health and well-being
• Goal 6: Clean water and sanitation
• Goal 13: Climate action
• Goal 14: Life below water
• Goal 15: Life on land
• Goal 4: Quality education
• Goal 5: Gender equality
• Goal 8: Decent work and economic growth
• Goal 10: Reduced inequalities
• Goal 16: Peace, justice and strong institutions
• Goal 17: Partnerships for the goals

NCC's expertise and solutions influence sustainable development; various initiatives contribute to these goals

Sustainable Products & Innovation

• NCC Green Asphalt
• NCC Machine Sand
• Drainage products
• NCC Armour Stone

Awards & Recognition

• Oslo Municipality’s environmental award for KA-13 project

Environmental Metrics

ESG Focus Areas

• Climate and energy
• Health and safety
• People and team
• Ethics and compliance
• Materials and circularity
• Natural resources and biodiversity
• Data and expertise
• Economic performance

Environmental Achievements

• Emission intensity amounted to 2.5 CO2e tons/SEK M, corresponding to a reduction of 52 percent compared with 2015.
• CO2e emissions from ready-mix concrete reduced by 16 percent since 2015.
• CO2e emissions from internally purchased asphalt reduced by 31% in 2022 compared to 2015.
• CO2e emissions from steel reinforcement reduced by 38% in 2022 compared to 2015.
• Reclaimed asphalt pavement (RAP) increased to 26% of total asphalt production in 2022, resulting in approximately 7,300 tons lower CO2e emissions compared to 2015.
• New concrete formula reduced cracks and carbon emissions by 30 percent in the upgrade of Lilla Edet hydropower plant.

Social Achievements

• Launched NCC Site Introduction, a new digital program focusing on worksite safety.
• High employee engagement (7.9/10) from employee survey, above external benchmark.
• Good reputation among candidates (8.9/10) for offering good career opportunities.
• Zero tolerance of discrimination.

Governance Achievements

• Linked sustainability targets to an existing revolving credit facility of EUR 280 M.
• Issued green bonds valued at SEK 1 billion.
• Updated green framework for bonds, verified by CICERO.

Climate Goals & Targets

Environmental Challenges

• Rising prices for energy and input materials.
• Difficult external conditions in the form of rising energy prices and internal challenges in asphalt operations.
• Effects of rapidly rising interest rates and difficulties for investors in securing financing in commercial property development.
• Uncertainty about the future supply of cement in Sweden.
• Higher accident frequency rate (LTIF4) of 4.1 compared to the target of 3.0.

Mitigation Strategies

• Prioritizing segments in which NCC’s strengths come to the fore.
• Strong business acumen in Building Sweden and Building Nordics.
• Changes made to governance and management in Industry business area.
• Biding time until opportunities to generate value from ongoing projects arise in Property Development.
• Evaluating opportunities to launch new projects at a lower risk level.
• Monthly forecasts on commodities and close dialogue with suppliers.
• Fixed prices in frame agreements.
• Long-term raw material strategies.
• Securing bitumen supply with multiple key suppliers.
• Increasing the number of depots under NCC control.
• Reducing the number of specialty products.
• Skills mapping and development plan for key positions.
• Group common development programs for project management and leadership.
• Workshops in Star Behaviors to improve culture and behavior.
• Structured succession planning process.
• Strategic direction to reduce common accidents and eliminate serious incidents and fatal accidents.
• Systematic work to improve and increase the number of digital and physical safety barriers.
• Intensive work to improve Site Introduction setup.
• Clarification of safety directives and guidelines for all managers.

Supply Chain Management

Responsible Procurement

• Code of Conduct for Suppliers
• Supplier assessments
• Supplier social and environmental assessment

Climate-Related Risks & Opportunities

Physical Risks

• Flooding, erosion, and landslides

Transition Risks

• Carbon-price mechanisms
• Changed customer behavior

Opportunities

• Development of low-emission goods and services
• Increased demand for sustainable products and services
• Use of lower-emission energy sources
• Return on investments in low-emission technology
• Resource efficiency

Reporting Standards

Frameworks Used: GRI Standards 2021, TCFD

Certifications: ISO 14001, ISO 9001

UN Sustainable Development Goals

• SDG 7
• SDG 9
• SDG 11
• SDG 12
• SDG 3
• SDG 6
• SDG 13
• SDG 14
• SDG 15
• SDG 4
• SDG 5
• SDG 8
• SDG 16
• SDG 17

NCC's potential to contribute to SDGs is integrated into its sustainability framework and overall business development.

Sustainable Products & Innovation

• NCC Green Asphalt
• NCC Machine Sand
• Environmentally optimized parking buildings
• Drainage products
• NCC Armour Stone

Awards & Recognition

• Three Sweden Green Building Awards

Environmental Metrics

ESG Focus Areas

• Climate and energy
• Health and safety
• Materials and circularity
• Natural resources and biodiversity
• People and team
• Ethics and compliance
• Data and expertise

Environmental Achievements

• Reduced emission intensity to 2.3 tons CO2e/SEK M, a 56% reduction compared to 2015.
• Used eco-friendly concrete in the West Link project, saving 40,000 tons of CO2e.
• Used "low-carbon extreme" concrete in Trondheim, reducing the climate footprint by about 50% compared to standard concrete.
• Converted all asphalt plants in Sweden to biofuel.
• Retained existing foundation and concrete frame in Borlänge project, saving about 1,900 tons of CO2e.

Social Achievements

• Employee commitment score of 8.0/10.
• Improved employee perception of the company’s zero tolerance of discrimination (8.8/10).
• Fewer serious incidents despite a difficult year in health and safety.

Governance Achievements

• Implemented anti-corruption training for all white-collar employees.
• Updated and relaunched anti-corruption training in 2023.
• Established a risk-based compliance program including a whistleblower channel.

Climate Goals & Targets

Environmental Challenges

• Geopolitical situation and market volatility.
• Material and price increases.
• Skills supply and leadership.
• Health and safety incidents.
• Management of operations.
• Supply chain issues.
• Group-wide IT development.
• IT security.
• Compliance breaches.

Mitigation Strategies

• Monitoring market and financial developments.
• Internal processes to manage price increases.
• Segment prioritization and portfolio governance.
• Long-term raw material strategies.
• Skills development plans and programs.
• Focus on reducing high-risk behaviors.
• Improving safety planning and organization.
• Dedicated resources for IT development.
• Information Security Management System and Cyber Security Operation Center.
• Risk-based compliance program and training.

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Supplier pre-qualification
• Systematic evaluations to ensure compliance
• Code of Conduct for Suppliers

Climate-Related Risks & Opportunities

Physical Risks

• Not disclosed

Transition Risks

• Higher carbon prices
• Increased climate-related reporting requirements

Opportunities

• Increased demand for low-carbon products and services
• New business models and revenue streams

Reporting Standards

Frameworks Used: GRI Standards 2021

Certifications: ISO 14001, ISO 9001

Third-party Assurance: PricewaterhouseCoopers AB (PwC)

UN Sustainable Development Goals

• SDG 7
• SDG 9
• SDG 11
• SDG 12
• SDG 3
• SDG 6
• SDG 13
• SDG 14
• SDG 15
• SDG 4
• SDG 5
• SDG 8
• SDG 16
• SDG 17

NCC's operations and offerings contribute to various SDGs through resource management, sustainable products, and value-driven principles.

Sustainable Products & Innovation

• Eco-friendly concrete
• Low-carbon asphalt

Awards & Recognition

• Årets hållbara infrastruktur (Sustainable Infrastructure Project of the Year)