Sustainability targets: Our operations

Code of Conduct

– Defined by the content of the Code of Conduct

1) 100%* of all employees trained in our Code of Conduct.

*Including employees and consultants hired for 3 months or more. Margin of error to account for long-term leave and vacations is 2%.

1) 94%

1) 100%* of all employees trained in our Code of Conduct.

2) 90% of new employees trained in our Code of Conduct within 3 months.

– Follow-up on training efforts in all parts of the Sandvik organization.

– Renewal of training package and launch of new learning platform for better tracking.

– Review of the Code of Conduct.

– An operation where business ethics is fully embedded in everyday discussions and decisions, and no breaches of the principles of our Code of Conduct exists.

Speak Up

– All in the Code of Conduct

1) Improve average open days KPI from 88 days (2017) to 55 days by end 2018.

2) Keep remediation implementation rate under 40%.

*Including cases in the past rolling year that have a status of either “new” or “in process”, meaning that 60% of cases should be closed and remediated.

1) 67

2) 34%

1) Average open days not to exceed 40 days.

2) Improve the results from 2018 SEmp survey.

(a) Awareness to exceed 83%.

(b) Confidence in the system/process to exceed 74%.

– Awareness training package launched.

– Speak Up case handling training (investigations).

– Speak Up to open up in two additional countries.

– Improve reporting on case management for Speak Up.

– All employees fully aware of Speak Up as an opportunity to report, and input used in the continuous improvement of business ethics at Sandvik.

Compliance

– Anti-corruption and anti-bribery

– Data privacy

– Trade compliance

– Competition law

1) Code of Conduct training, see above.

2) Screen 100% of all Commercial Intermediaries according to the set procedure.

1) See above

2) 86%

1) 100% of all identified material entities* shall have reported and haven a Basic Compliance Ratio.

*As defined together with each division

– To reach the 2025 ambition including decentralization to the lowest organizational level of accuntability. A key action is to measure activites at entity level. The 2019 objective is to establish a reporting mechanism and create a baseline for setting a target for activities in 2020.

– An integrity-based Culture of Doing Things Right will be the way we work, creating value and competitive advantage which positively impacts our employee engagement, financial and business objectives and society in accordance with our sustainability goals. Compliance programs will be embedded into business processes, decentralised to the lowest organizational level of accountability, measured, controlled and monitored.

Sustainable Supplier Management

– Sustainable procurement practices

– Suppliers sustainability performance

– Sustainable supplies

1) 95% of Tier 1 suppliers risk assessed according to Sandvik’s Supplier Code of conduct (SSCoC) inherited risk matrix.

2) Audit identified high risk suppliers.

1) 75% of spend

2) 202 audits

1) Active suppliers, corresponding to 100% of supplier spend, risk assessed according to Sandvik inherited risk matrix.

2) Workplan in place for rolling out Sandvik Supplier Sustainability Questionnaire.

3) 100% of corrective actions pertaining to audits performed in 2018 and 2019 implemented within the time limit agreed with the supplier.

4) Suppliers representing 85% of spend having signed our Supplier Code of Conduct.

– Improve the quality and completeness of supplier data necessary for SSCoC inherited risk calculation and measure the respective risk using a common method across business areas.

– Prepare all business areas for the launch of supplier sustainablity questionnaire, as a second step of SSCoC due dilligence.

– Pursue audits follow up to ensure implementation of all corrective actions in due time.

– Increase supply base compliance with Sandvik Supplier Code of Conduct and other sustainability requirements

– Embed sustainability in the purchasing processes

– Use of sustainable raw materials, resources and goods, whenever practical.

Environmental footprint

– Energy use

– CO₂

– Water use

– Waste

1) 1.5% reduction of energy use.

2) 2.2% reduction of CO₂ emissions.

3) 1.2% reduction of water use.

4) 0.8% reduction of waste generation.

1) –1.7%

2) –1.0%

3) 3.9%

4) 11.5%

1) 1.3% reduction of enegy use from environmental improvement action.

2) 1.3% reduction of CO₂ emissions from environmental improvement action.

3) 0.6% reduction of water use from environmental improvement action

4) Reduce total waste by 0.2% from environmental improvement action.

– Using a new ‘bottom up’ approach, these targets are based on activities / outcomes specified / predicted by individual locations.

– Achieve significant improvements in areas where our operations have a significant environmental impact.

Health and Safety

– Fatality elimination

– Injury Rate Reduction

– Increase reporting of Occupational Illness

– Health and Well Being Programs

1) LTIFR: 1.4

2) TRIFR: 4.3

1) LTIFR: 1.7

2) TRIFR: 4.0

1) TRIFR: 3.6

2) LTIFR: 1.4

– Each business area /division is required to implement ‘localised’ annual EHS Plans that address Sandvik’s 5 Focus Areas within its EHS Objectives. In addition to a wide range of activities that are put in place every year by all business areas /divisions to reduce injuries and occupational illnesses, SMRT is piloting a program, Critical Control Management, that is specifically aimed at eliminating fatalities. The reporting of lagging health and safety performance indicators up to the Group Executive Management will continue on a monthly basis and, in 2019, the frequency of reporting of business area progress against all of Sandvik’s EHS Objectives will increase to quarterly.

– To eliminate fatalities at Sandvik controlled locations.

– All employees will work within a Safety culture and work environment which acts proactively to significantly reduce work related injuries, illnesses and other incidents to achieve our 2020 ambition of a LTIFR of <1.0.

A Diverse and Inclusive organization

– Equal career opportunities

– Open and transparent internal job market

– Balance internal vs external sourcing to management positions

1) Share of women in managerial positions, target to increase by 3% annually (baseline: 17.1%).

2) Share of open recruitments to top management positions, target 90%.

3) Share of internal and external sourcing to top management positions, target 80% internal and 20% external.

1) 17.7%

2) 82%

3) 78% internal, 22% external

1) Share of women in managerial positions, target to increase by 3% per year (baseline: 17.7%).

2) Share of open recruitments to top management positions (%), target 90%.

3) Share of internal and external sourcing to top management positions, target 80% internal and 20% external.

– All action plans related to these focus areas are owned by the business areas and divisions. During 2019, we will continue to develop a solid follow-up process to monitor the progress of the plans.

– A high performing organization capitalizing on diversity and inclusion to secure competitiveness.

– Strengthen an open and transparent internal job market where job opportunities are visible and available to our employees in order for them to take responsibility for their own career.

– Our ability to develop and appoint internal candidates and use all of Sandvik as a candidate pool is a key success factor to ensure future performance and growth.