Our strategy

Arrows and text with background (graphic)

* AkzoNobel uses adjustments to the IFRS measures to provide supplementary information on the reporting of the underlying developments of the business. APM include, but are not limited to, adjusted , (adjusted) , adjusted , and . A reconciliation of the alternative performance measures to the most directly comparable IFRS measures can be found in Note 4 of the Consolidated financial statements.

** ROS is calculated as adjusted operating income (operating income excluding ) as a percentage of revenue from third parties.

AkzoNobel is a truly global, high-performing paints and coatings company with a proud heritage which can be traced back to 1792. Our world class portfolio of established brands is trusted by customers around the world and we continue to be guided by a strong set of core values – safety, integrity and sustainability. In fact, our People. Planet. Paint. approach to sustainable business has now become the overarching mantra for everything we do.

Our Grow & Deliver strategy balances growth with further profitability improvement, building on the strong foundation we now have in place. Ultimately, our goal is to be the frontrunner – both in terms of size and performance – among leading players in the industry.

Our fundamentals remain the same: passion for paint, precise processes, powerful performance, proud people; while key behaviors guide our ways of working: be customer focused, execute with discipline, deliver on commitments, take ownership.

Growth drivers (graphic)

Growth drivers

We’re well placed in the approximately €140 billion paints and coatings industry. Our balanced geographic presence and strong portfolio of brands – with leading positions in most market segments – offers multiple opportunities for growth.

We have a significant presence in the higher-growth region, where we generate around 12% of total revenue. We’re the leader in the fast-growing and sustainable powder coatings market, which currently accounts for 14% of our revenue. Other market segments and regions also offer exciting growth opportunities, such as packaging coatings – being driven by a shift away from single use plastics to metal cans – along with aerospace coatings, yacht coatings and our Decorative Paints business in .

Strategic mandates – per market segment and region – are used to provide clear direction for each of our businesses, including relative priorities for growth and profitability improvement.

Market segments and regions representing around one third of our total revenue have clear growth mandates. For example, we’re growing our Decorative Paints business in China by leveraging our premium Dulux brand to serve customers in a greater number of cities with more innovative and sustainable solutions.

With stakeholders increasingly demanding more sustainable solutions, we’re well placed to capitalize on this trend by leveraging our widely recognized leadership position when it comes to sustainability. Sustainable solutions already account for 39% of revenue and we have a target to increase this to more than 50% by 2030. We’re creating a more efficient company while lowering our and are proud to have set science-based carbon reduction targets for our full value chain – a truly fact-based approach.

Innovation is therefore fundamental to our success (see the Stepping up our collaborative innovation chapter). For us, this means going beyond when it comes to providing customers with products and services, as well as understanding and anticipating their changing needs and expectations. Revenue from new product introductions was around 20% during the past five years. Our industry-leading Paint the Future collaborative innovation ecosystem is just one example of how our pioneering spirit is helping us to continue pushing boundaries.

We have a strong balance sheet and clear capital allocation priorities, providing a solid platform for adding to organic growth – in a disciplined way – with targeted acquisitions, which are both value-creating and aligned with our strategic mandates. In 2021, we completed the acquisition of Titan decorative paints in Spain, while New Nautical Coatings was added to our presence in yacht coatings, and we announced the acquisition of Grupo Orbis, to expand our presence in South America.

"Youth Zhuhai” themed Boeing 737-800 (photo)

It’s not just the livery of this China Southern Airlines “Youth Zhuhai” themed Boeing 737-800 that’s breathtaking. So is the lightning fast speed it took to paint it. With only 14 days and 34 new colors to develop, our color lab in India and Aerospace Coatings production team in DongGuan, China, rose to the challenge.

Delivering performance improvement

To help drive our Grow & Deliver strategy, we’re evolving our operating model, moving from functional excellence in silos to driving cross-functional collaboration, with an emphasis on end-to-end processes and becoming even more customer focused.

Strong margin management is particularly important when facing significant raw material cost inflation. We’re building on our experiences from 2017-2018, with faster and even more robust pricing initiatives for 2021-2022 and setting ourselves up to deal with future cycles.

We’re building product management capabilities, which are necessary to deliver the products our customers desire and win in the market – at the most competitive cost, with less complexity and increased collaboration with our suppliers.

Strategy (graphic)

* Profit =

Creating a world class supply chain requires more efficiency and effectiveness – built on strong planning processes – in order to meet customer needs with superior service levels. Meanwhile, our manufacturing network will be optimized via three supply models: simple and efficient, managed complexity, agile and adaptive.

We’re also continuing with several initiatives, for example integrating our systems and applications, designed to deliver seamless business services that are effective and cost competitive, allowing for greater focus on what matters most.

Alternative performance measures (APM)

AkzoNobel uses APM adjustments to the IFRS measures to provide supplementary information on the reporting of the underlying developments of the business. APM include, but are not limited to, adjusted operating income, (adjusted) EBITDA, adjusted earnings per share, ROS and ROI.

Operating income

Operating income is defined in accordance with IFRS and includes the relevant identified items. Adjusted operating income excludes identified items.


Operating income excluding depreciation and amortization.

Earnings per share

Net income attributable to shareholders divided by the weighted average number of common shares outstanding during the year. Adjusted earnings per share are the basic earnings per share, excluding identified items and taxes thereon.

ROS (return on sales)

ROS is adjusted operating income as a percentage of revenue.

ROI (return on investment)

ROI is adjusted operating income of the last 12 months as a percentage of average invested capital.

Identified items

Identified items are special charges and benefits, results on acquisitions and divestments, major restructuring and impairment charges and charges related to major legal, environmental and tax cases.

South Asia Pacific

Includes South East Asia and Asia Pacific.

South America

Excludes Mexico.

Carbon footprint

The total amount of greenhouse gas (GHG) emissions caused during a defined period of a product’s lifecycle. It is expressed in terms of the amount of carbon dioxide equivalents CO2(e) emitted. Greenhouse gases include CO2, CO, CH4, N2O and HFCs, which have a global warming impact. We also include the impact of VOCs in our targets.

Adjusted EBITDA

Adjusted EBITDA is operating income excluding depreciation, amortization and identified items.