Note 3: Stakeholder engagement

Our approach

The aim of our ongoing stakeholder engagement is to learn from key financial, social and environmental stakeholder groups and, in collaboration, to develop innovative and sustainable solutions to address some of the world’s most pressing challenges. Our Planet Possible agenda is not only designed to help drive innovation and enable us to become radically resource efficient, it’s also intended to inspire employees, customers, suppliers and other key stakeholders to work together with us in achieving this.

Reaching out to all our stakeholders in ongoing conversation and dialog is vital to achieving our goals and to further developing our long-term vision and strategy in all areas of sustainability. Our key stakeholders are employees, suppliers, customers, investors, shareholder representative groups, NGOs and international organizations, governments, industry associations, sustainability rating agencies and communities. Based on the company strategy, emerging societal and business issues, and the outcomes of our materiality analysis, we identify the key topics and levels of engagement per stakeholder group, which can vary from pro-active engagement to providing information upon request.

This section includes several 2014 highlights. More details can be found on our corporate website, in the Strategic performance section and other chapters of this Report 2014:

Stakeholder engagement in 2014

Our commitment and primary partners

We support a number of charters and external organizations to demonstrate our commitment to sustainability issues. We have been a signatory to the UN Global Compact since 2004. We are a partner of the Caring for Climate platform and an active member of the Global Compact Netherlands Network: in 2014, we laid the groundwork to participate in a project to explore how to improve awareness and build capability in the area of human rights in four key countries – Indonesia, Mexico, South Africa and Turkey – that will take place in 2015.

In addition, we subscribe to the UN Universal Declaration of Human Rights; the key conventions of the International Labor Organization; the OECD Guidelines for Multinational Enterprises; the Responsible Care® Global Charter and the CEO Water Mandate.

In order to contribute to, and keep up to date with, important developments in sustainability, we participate in meetings and task forces as a member of organizations such as the WBCSD, Forum for the Future, True Price and the Dutch Sustainable Growth Coalition (DSGC). Our CEO was a keynote speaker at the DSGC event in December. He addressed an audience which included Her Majesty Queen Máxima of the Netherlands and international industry leaders on innovation, collaboration and technology in sustainability.

Since 2010, we have been a member of Worldconnectors, a Dutch-based initiative working to broaden the discussion on international issues by incorporating perspectives from a cross-generational network. In 2014 we were one of more than 60 signatories to their Post-2015 Charter, committing to contribute to the achievement of the United Nations Sustainable Development Goals (2015-2030).

Customers and products

Our customers are increasingly looking for products and solutions that will make their business more sustainable. In order to continuously improve our product offering, we encourage customers to challenge us and work together with us. Part of this approach is to include customer sessions in our quarterly Sustainability Council meetings. In 2014, international shipping company Maersk participated in one of these meetings to share knowledge and best practice and identify areas where we can work together to reinforce our sustainability efforts. There are many more specific examples in the various case studies and the Business performance section of this Report 2014. In addition, we are in the process of improving our methods to monitor customer engagement and customer satisfaction.

AkzoNobel’s Ferrazone iron fortificant is making an important contribution to the Millennium Development Goals of the United Nations. Ferrazone is a bioavailable iron source designed to help fight global anemia, an effort supported through partnerships with the Amsterdam Initiative on Malnutrition (AIM), the Global Alliance for Improved Nutrition (GAIN) and the project Smarter Futures.

In 2014, millions of people benefited from programs to fortify staple foods with Ferrazone. An important milestone was the signing of a new long-term agreement to collaborate in a private-public partnership with NGOs, the Dutch Ministry of Foreign Affairs and other leading companies. The parties agreed to set up a quality improvement network in Africa which will comprise of facilities along the food production value chain: a field testing facility, a laboratory facility performing a full range of food analyses, an auditing and certification facility and a financing facility supporting applicants to finance their quality assurance and control related investments. AkzoNobel is responsible for the development and validation of analysis methods for iron, zinc, calcium and iodine in fortified food, as well as providing technical assistance and training of laboratory staff and advising on best practice laboratory management.

AkzoNobel has been a global partner of the Forest Stewardship Council (FSC) since 2010 with the aim of growing awareness of responsible forestry worldwide. We proudly display the partnership logo on packaging for our wood care products. In 2014, awareness of the AkzoNobel-sponsored Smallholder Support Program was raised with the launch of the “Made with Heart” campaign. With the mandate of its membership, and with support from AkzoNobel, in 2012, FSC developed a specific on-product label – the Small and Community Label Option (SCLO) – to increase the visibility of small-scale producers in the market place. When consumers buy a product carrying the “Made with Heart” concept, they are assured that the product originates from a community that is dedicated to protecting natural resources, and which benefits from this both financially and socially.

Besides strengthening the link on a global level, we will also continue to increase the ten active local partnerships we have between FSC and AkzoNobel in the Netherlands, UK, Germany, Switzerland, Czech Republic, Brazil, Russia, the Nordics, Argentina and Poland, year-on-year.

In June 2014, the Sustainable Trade Initiative on Pulp & Paper (STIPP) was launched to help sustainability become the norm in the pulp and paper industry. STIPP is a sector-wide initiative co-founded by IDH (The Sustainable Trade Initiative), Asia Pulp and Paper Group and AkzoNobel and supported by the Indonesian Ministry of Forestry and the Indonesia Pulp & Paper Association. This partnership is a result of our customers’ needs for sustainable pulp and paper products, which is why we are intensely involved in providing clean technologies for pulp and paper production.

Suppliers and sourcing

During 2014, we continued to engage with Together for Sustainability (TfS), a chemical sector initiative designed to create more sustainable supply chains. TfS is a collaboration founded by the Chief Procurement Officers of BASF, Bayer, Evonik, Henkel, Lanxess and Solvay and aims to build the industry’s standard for sustainable supply chains. The TfS program utilizes high quality third party sustainability assessments and audits in order to measure the supplier’s sustainability performance against a pre-defined set of industry best practice criteria.

To enhance the importance and development of sustainable value chains, we’ve been supporting the organization of the International Supply Management Congress in Amsterdam since 2010. This is a joint initiative with IDH, PwC, NEVI (Dutch knowledge network for purchasing and supply management), Shell, DSM and Unilever. The event is a meeting point for sharing knowledge, experience and best practices across supply chain professionals, NGOs and thought leaders. The focus for 2014 was on the future of supply management and perspectives through new partnerships.

For more information, see Note 7 of this section.

Engaging employees

During 2014, we continued to engage employees from around the world on the theme of sustainability through our Planet Possible concept.

For more information, see Note 6 of this section.

Energy and climate

Our aim is to achieve cost effective energy sources and maximize sustainable impact while being prepared for future developments. For our energy-intensive production processes, AkzoNobel is actively engaging in diversifying the energy-mix to lower risks and enhance our sustainability performance by reducing our carbon footprint and increasing the use of renewable energy. In 2014, we strengthened and intensified our dialog with key stakeholders at European Union (EU) and national levels on issues regarding the reform of the Emissions Trading Scheme (ETS), improving the conditions for sustainable supply of steam from biomass and waste and the better functioning of the EU internal energy market. In addition, we engaged in a number of consortia on innovations in bio-based chemistry. We also worked on stronger engagement with stakeholders around our production locations to increase the use and integration of renewable energy into our energy-mix.

We co-chair the WBCSD Chemicals Sector Working Group, which has been developing a consensus approach to some aspects of lifecycle assessment. Together with peers, we have developed two chemical sector guidelines to drive consistent and comparable reporting of both the environmental footprint of chemical products and carbon avoided emissions. It is a global effort which also involved relevant stakeholders in the process of developing a harmonized approach towards the calculation of environmental impacts along the value chain.

Developing good practice

As part of our efforts for continuous improvement and the development of good practice, we participate in a range of activities that offer the opportunity to learn from and share and engage with a broad group of stakeholders.

We are incorporating natural capital thinking to ensure our business is sustainable as it grows. We continue to use our membership of the International Union for Conservation of Nature’s (IUCN) business engagement network Leaders for Nature, in place since 2006, to understand and develop our biodiversity priorities. The main focus for our own operations is on climate change mitigation (through the adoption of a carbon mitigation policy) and pollution control (monitoring air, water, and soil emissions). During the year, a development activity took place focused on our raw materials, when our 2014 Leaders for Nature group researched the impact of soybeans on deforestation in South America.

Our product portfolio includes solutions that deliver both environmental and social benefits to our customers and wider society. While processes for measuring environmental benefit are well advanced, social impact measurement is less well developed. Therefore, we contributed to the Roundtable for Social Metrics and the WBCSD social metrics working group, working together with leaders in the industry to develop ways of quantifying the social challenges we are facing. Ultimately, this process will enable us to identify areas that require attention and drive further improvements.

Furthermore, we participated in a workshop about business and human rights impacts in China from the Dutch Social and Economic Council (SER).

We took part in the biennial meeting of the United Nations Global Alliance to Eliminate Lead in Paint (GAELP) and were able to inform the 20 countries present that AkzoNobel does not add lead compounds to any of its products. We were also invited to participate in a public workshop organized by Chemsec to exchange knowledge and share our approach to priority substances with other companies, government representatives and NGOs.

To help us in further developing integrated reporting and transparency, AkzoNobel was one of the pilot companies for the International Integrated Reporting Council program to create a forward-looking company reporting framework, and provided company input to the working group. We are now a member of the business network, made up of companies committed to making the framework a practical reality. Learnings from this program are included throughout this Report 2014.

Shareholders, analysts and indices

We continuously developed our engagement with shareholders and investors on sustainability aspects by taking part in conferences and meetings during the year, as well as answering questions in telephone briefings and questionnaires. In addition, in May 2014, we organized our first Social Responsible Investor (SRI) conference call, which was attended by a range of more than 40 SRI and mainstream investors. Questions during 2014 focused on financial and environmental benefits from sustainability activity and solutions for customers, raw materials supply and carbon policy, as well as safety and the development and training of employees.

Sustainability aspects of business are also included in many analyst and general shareholder presentations. Following the 2014 AGM, for example, the Dutch Association of Investors for Sustainable Development (VBDO) indicated they would like to see a more long-term strategy in the areas of eco-efficiency and renewable raw materials. This has been covered by the new Planet Possible agenda that was launched in 2013.

Investors make use of sustainability rating agencies. An overview of the agencies and their ratings can be found in the table below:

Sustainability rating agencies

 

 

RobecoSAM (Dow Jones Sustainability Index)

We were industry group leader for the third consecutive year, and have been in the top three for the last nine years.

CDP

We have participated in the CDP assessments since 2007 and qualified for the Benelux Climate Disclosure Leadership Index (CDL) 2014.

Sustainalytics

Sustainalytics has covered us in their rating since 2004. For the second year in a row, we rank first in the Chemicals Industry ranking.

Oekom

Oekom research has analyzed us since 2001. We have been awarded Oekom Prime status since 2012. We currently rank in the top five chemical companies.

Vigeo

Vigeo has rated us since 1999. In 2014, we were among their leader group in ESG performance, resulting in inclusion in all their ethical indices.

Sustainability rating agencies (logos)Sustainability rating agencies (logos)

For an overview of our listing on sustainable stock indices, turn to AkzoNobel on the capital markets in the Governance and compliance section.