Change

Strive for world class levels of sustainability and safety


Building a sustainable, successful business is embedded in all aspects of our strategic agenda, because at AkzoNobel, our commitment to sustainability goes substantially beyond managing risks, governance and compliance. To us, sustainability involves creating opportunities for value creation through process excellence, innovation and talent development. We have developed a framework to demonstrate the essential relationship between all these elements, which is described in the Sustainability facts and figures section.

The good progress we have made in this respect was recognized externally in 2009 when we maintained our position in second place on the Dow Jones Sustainability Index for 2010. The assessment confirmed areas of strength in corporate governance, risk management, supplier aspects and climate policy. In the area of innovation management, improvement opportunities were identified consistent with the way our RD&I processes are developing. Other focus areas for improvement are operational eco-efficiency and aspects of talent attraction and retention.

Our Sustainability Framework includes a number of key areas described earlier:

Safety

We are very pleased to have made a noticeable improvement in our total reportable injury rate for employees and supervised contractors. We achieved a total reportable injury rate of 3.7 injuries per million hours worked in 2009, down from 4.6 in 2008. This improvement was due, in part, to the continued roll-out of our behavior-based safety program at all our sites. We also piloted a new Safety Leadership Program targeted at senior business leaders. The first sessions were held in the Netherlands and involved all members of the Board of Management and the corporate directors. Both programs will continue to be implemented throughout the company during 2010.

Behavior-based safety (BBS) in Functional Chemicals

Our Functional Chemicals site in LeMoyne, Alabama, in the US has a long history in BBS which dates back to 1996. The facility has an excellent track record, achieving three million hours without a lost time injury. Employees are very active in sharing best practices with other AkzoNobel sites, having notably partnered with a nearby Pulp and Paper Chemicals plant to host a networking meeting with eight US manufacturing sites.

Our sites around the world have been implementing enhanced standards for process safety and occupational health, and an improved Health, Safety, Environment and Security (HSE&S) audit process. This new process has raised the bar to deliver a step change in performance during the next five years. It focuses on site-based improvement targets and sharing good practice across the company, with corporate HSE&S audits to review progress.

Product stewardship

A newly-formed Global Product Stewardship and Regulatory Affairs Council, with representatives from all Business Areas, is responsible for ensuring that AkzoNobel goes beyond all legal and ethical requirements for our products on the global market. The council will integrate the good practice from across the company into a product stewardship framework and subsequently ensure that resources, training and audits are optimized.

The regulatory focus has been on implementing a range of notification, classification and labeling regulations around the world. We are working towards the 2010 REACH registrations in Europe; a range of new notification requirements in Asia; as well as implementation of the Globally Harmonized System of Classification and Labeling of Chemicals (GHS).

Managing scarce resources

Managing the carbon footprint of our products not only creates more value for our customers, but is also a societal imperative. Following the 2008 pilots, we have assessed the cradle-to-gate carbon footprint of the 158 key value chains across our businesses, with the aim of identifying focus areas for improvement. Each business is developing a carbon management plan and improvement targets, while sourcing managers have started working with suppliers to reduce raw material footprints. During 2010, we will continue to assess key customer applications to gain a better view of the downstream footprint of our products. Details of the company cradle-to-gate footprint are included in the Sustainability facts and figures section.

Beyond carbon, during 2009, we started to estimate the total eco-footprint of our businesses in order to prioritize future improvement areas in all parts of the lifecycle. We have engaged external support from German professor Michael Braungart and EPEA to review the cradle-to-cradle opportunities in our businesses. The aim is to integrate this approach into innovation processes and accelerate the changes required to reduce the footprint of our products.

Improving the eco-footprint in Pulp and Paper Chemicals

At our facilities in Québec, Canada, Pulp and Paper Chemicals reduced its electricity consumption per ton of product through technology improvement. In total, power consumption has decreased by more than 20,000 MWh per year.

Sustainable fresh water supply is essential to life – and to the sustainability of our business. During 2009, 99 percent of our production sites (our target is 100 percent) carried out a risk assessment of the sustainability of their fresh water supply and use, taking into account both the societal impact and the business continuity aspects. The results show that 38 percent of sites already have sustainable fresh water management in place. The remainder will develop plans to achieve this status by 2015.

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