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 conversations 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 2015 highlights. More details can be found on our corporate website, in the Strategic performance section, and other chapters of this Report 2015:

Stakeholder engagement in 2015

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 of 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.

We are participating in a program led by the UNGC network in partnership with Oxfam Novib, Oxfam America and Shift, a non-profit center for business and human rights practice, supported by a grant from the Dutch government. The aim is 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. Company managers have taken part in workshops to explore the local issues and potential areas for joint activity. The project builds on the successful 2008 – 2010 Business and Human Rights Initiative, in which several Dutch multinationals, including AkzoNobel, collaborated to contribute to the development of the UN Guiding Principles on Business and Human Rights. It will lead to an updated publication and an online portal of resources to support action.

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). 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 of their Post-2015 Charter, committing to contribute to the achievement of the United Nations Sustainable Development Goals (2015-2030). We have reviewed these goals against our company agenda and priorities. Our Human Cities agenda will lead to a focus on Goal 11 Sustainable cities and communities, and Goal 17 Partnerships for the goals, extending existing and developing new programs or partnerships:

  • Our Buildings and Infrastructure products and partnership activities to support affordable housing, cultural heritage, improved air quality and sustainable cities policies; our Transportation end-user products to support affordable, safe transport
  • Our Human Cities initiative contribution to urban resilience and regeneration in partnership with the Clinton Global Initiative and the Rockefeller Foundation’s 100 Resilient Cities program
  • AkzoNobel’s Human Cities Coalition, a multi-stakeholder group in the Netherlands, contributing to the development of the New Urban Agenda to be adopted during 2016 in Quito, Ecuador
  • The Sustainable Trade initiative on Pulp & Paper (STIPP), a sector-wide trade initiative in Indonesia (link to Goal 15 Life on land)
  • Partnerships for the development/supply of renewable energy, including the WBCSD Energy Efficiency in Buildings program (link to Goal 7 Affordable and clean energy)
  • The Advanced Research Center Chemical Building Blocks Consortium (ARC CBBC), a major Dutch consortium which has announced plans to establish a national research center focused on tackling important energy and chemistry issues associated with the growing depletion of the finite supply of raw materials, involving companies, government and universities – which also links to Goal 12 Responsible consumption and production and Goal 7 Affordable and clean energy

In addition to these focus areas, our current product portfolio allows us to make some contribution to Goals 2, 6, 7, 12, 15. Our operations/internal targets and international operations will have a minor influence on Goals 3-16.

United Nations Sustainable Development Goals (SDGs)

 

 

 

 

 

 

 

 

 

 

 

Main Intermediate Minor

 

Operations

 

International business

 

Products

 

Human Cities Community

1

 

No poverty

 

 

 

 

 

 

 

2

 

Zero hunger

 

 

 

 

 

 

 

3

 

Good health and well-being

 

 

 

 

 

 

 

4

 

Quality education

 

 

 

 

 

 

5

 

Gender equality

 

 

 

 

 

 

 

6

 

Clean water and sanitation

 

 

 

 

 

7

 

Affordable and clean energy

 

 

 

 

8

 

Decent work/economic growth

 

 

 

 

 

 

9

 

Industry innovation and infrastructure

 

 

 

 

 

 

10

 

Reduced inequalities

 

 

 

 

 

 

 

11

 

Sustainable cities and communities

 

 

 

 

 

12

 

Responsible consumption/ production

 

 

 

 

13

 

Climate action

 

 

 

 

 

14

 

Life below water

 

 

 

 

 

 

 

15

 

Life on land

 

 

 

 

 

16

 

Peace, justice and strong institutions

 

 

 

 

 

 

17

 

Partnerships for the goals

 

 

 

 

 

 

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. This includes joint research and development projects. For example AkzoNobel’s Marine Coatings business has launched the first ever digital tool for the shipping industry that can accurately predict the potential fuel and CO2 savings offered by fouling control coatings. Intertrac Vision was developed in collaboration with leading academic and commercial research institutes and more than 30 shipowners and operators.

More specific examples can be found in the various case studies and the Business performance section of this Report 2015. In addition, we are in the process of improving our methods to monitor customer engagement and customer satisfaction.

One of our focus areas is to support legislation, standards and initiatives that promote and support the use of safer and more sustainable products in our industry. In 2015, we became a partner in the Global Alliance to Eliminate Lead Paint (GAELP) to promote the phase-out of all lead-based paints and eliminate the risks these products cause. We will support the work of the alliance by sharing experiences of conversion from lead to lead-free paints, providing technical advice and by supporting the development of legislation to phase out the use of lead compounds from all paints. See Note 10.

AkzoNobel’s Ferrazone iron fortificant continues to make an important contribution in the fight against iron deficiency anemia, a major global health issue, affecting around two billion people. It causes a loss of physical endurance due to reduced levels of haemoglobin and tissue iron. It is linked with increased risk of maternal mortality during pregnancy; while in infancy and childhood it can cause significant loss of cognitive abilities and decreased resistance to infections.

The most efficient way of combating the condition in developing countries is by fortifying staple foods, such as flour, with a form of iron that is readily absorbed by the body. AkzoNobel’s Ferric Sodium EDTA, Ferrazone, has been demonstrated to be both safe and effective in reducing iron deficiency, even in inhibitory diets lacking bioavailable iron. The use of Ferrazone also avoids undesirable color and flavor changes in the fortified food, as well as teeth staining. AkzoNobel is working closely with NGOs, governments and leading producers of so-called pre-mixes (a mix of vitamins and minerals used to fortify food) to provide the highest quality product and the know-how needed for successful application.

AkzoNobel was a global partner of the Forest Stewardship Council (FSC) from 2010 to 2015, with the aim of growing awareness of responsible forestry worldwide. This was the first and only partnership outside the forest products chain of custody. Over the five years, our sponsorship focused on the Smallholder Support Program, with the associated Made with Heart campaign and the on-product label – the Small and Community Label Option (SCLO) – to increase the visibility of small-scale producers in the marketplace. When consumers buy a product carrying the Made with Heart concept and the FSC label, 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. Over the years, we have also developed 11 active local partnerships between FSC and AkzoNobel in the Netherlands, UK, Germany, Switzerland, Czech Republic, Brazil, Russia, Sweden, Denmark, Argentina and Poland. This involved a range of communication and training activities and, in 2013, included the widest ever geographic coverage of the FSC Friday event.

A spokesman for FSC said: “FSC is grateful for AkzoNobel’s support to the FSC Smallholder Support Program. Together with the contribution since 2011, it allowed us to set up a program taking care of those in the FSC system, who do not have a very strong voice and need special attention. It helped to develop tools such as the Made with Heart marketing campaign and the smallholder fund, a financing mechanism for smallholders in the certification process. The inclusion of smallholders in the FSC system is of strategic importance to achieve the mission of our organization.”

AkzoNobel has also been involved in the set-up of a sector-wide trade initiative to accelerate Indonesia’s progress towards mainstreaming sustainability in the pulp and paper industry and building lasting relationships with customers. The Sustainable Trade Initiative on Pulp & Paper (STIPP) – a sector-wide initiative co-founded by IDH, APP and AkzoNobel and supported by the Indonesian Ministry of Forestry and the Indonesia Pulp & Paper Association – was launched in June 2014. STIPP aims to de-couple deforestation from the pulp and paper supply chain by initiating sector-wide solutions to the sustainability challenges, including peat land practices, High Carbon Stock (HCS) standards, clean manufacturing, yield intensification, community engagement and social conflict management. Significant support to the development of a “green provincial plan” for South Sumatra has been started, with STIPP supporting in the Pulp & Paper and Peatland Protection initiatives.

In addition, AkzoNobel is sharing expertise on “clean” manufacturing, supporting improved industry practices on resource and energy efficiency and waste management. This allows us to build close relationships with this important customer. The first project with APP is scheduled to begin in 2016.

Suppliers and sourcing

We continue to engage with Together for Sustainability (TfS), the chemical sector initiative to create more sustainable supply chains. Founded by the Chief Procurement Officers of six European companies, the initiative now has 16 partners across three continents and is making good progress towards building the industry’s standard for sustainable supply chains. The TfS program uses high quality third party sustainability assessments and audits to measure the supplier’s sustainability performance against a pre-defined set of industry best practice criteria, and shares that single assessment across the partners. It also provides a platform for monitoring improvement actions. For more information, see Note 7.

Engaging employees

During 2015, we continued to engage employees from around the world on the theme of sustainability through our Planet Possible activities. For more information, see Note 6.

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, we are actively engaging in diversifying the energy mix to lower risks and enhancing our sustainability performance by reducing our and increasing the use of renewable energy.

Information on some new energy partnership, for example with Eneco, and bio-based raw materials partnerships are included in the case studies, the Business performance section and Note 5 of this section. In addition, we engaged in a number of consortia on innovations in bio-based chemistry.

We co-chair the WBCSD Chemicals Sector Reaching Full Potential working group. Following work to develop a consensus approach to aspects of , the focus in 2015 was on partnerships to accelerate uptake of more sustainable products. AkzoNobel led the Energy Efficiency in Buildings Benelux Laboratory to contribute to the EU energy efficiency goals of 20 percent in 2020 and 27-30 percent in 2030. The team convened a wide range of building stakeholders to support the development/implementation of ambitious, practical, retrofitting solutions for large-scale residential buildings, schools and public and private office buildings.

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. During 2015, we tested the outcome of some of these activities in the extended pilot, as described in the case study in this section.

We continue to use our membership of the International Union for Conservation of Nature’s (IUCN) business engagement network to increase awareness and inspiration for AkzoNobel employees. Leaders for Nature, in place since 2006, is the IUCN NL business engagement network of 20 multinationals and major Dutch enterprises working together on greening the economy. The main biodiversity 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). We have also incorporated an assessment element in the 4D P&L pilot.

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. We are testing the outcome of some of this work in our 4D P&L pilot.

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 continue as a member of the International Integrated Reporting Council business network, made up of companies committed to making the integrated reporting framework a practical reality. Our Report 2014 gained recognition from the Ethical Corporation in the UK, won a European Excellence Award and was awarded the Transparency Benchmark Crystal Prize by the Dutch Ministry of Economic Affairs.

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 2015, we organized our second Social Responsible Investor (SRI) conference call. Sustainability aspects of business are also included in many analyst and general shareholder presentations.

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

Sustainability rating agencies

 

 

 

RobecoSAM (Dow Jones Sustainability Index)

 

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

CDP

 

We have participated in the CDP assessments since 2007 and achieved a 100 percent disclosure score in 2015.

Sustainalytics

 

Sustainalytics has covered us in their rating since 2004. For the fourth year in a row, we’re ranked among the industry leaders.

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 2015, we were among their leader group in ESG performance, resulting in inclusion in all their ethical indices.

Consolidated Sustainability statements – Sustainability rating agencies (logos)Consolidated Sustainability statements – 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.

Carbon footprint

The carbon footprint of a product or organization is the total amount of greenhouse gas (GHG) emissions caused during a defined period, or across the total or part of a product lifecycle. It is expressed in terms of the amount of carbon dioxide equivalents CO2(e) emitted.

LCA

Lifecycle assessments are the basis of our value chain sustainability programs. Eco-efficiency analysis (EEA) is our standard assessment method.

Four-dimensional profit and loss (4D P&L)

The four-dimensional profit and loss (4D P&L) methodology represents value creation in multiple dimensions. This is a totally new way of looking at an economy, where the impact of a company on society at large can be assessed.