Acting CEO statement by Fredrik Nilsson

Corporate social responsibility plays a more significant role today than ever before as we see an increased focus on sustainable business practices. Some of the recent sustainability trends that have gained a lot of attention include sustainability and transparency of supply chains, levels of greenhouse gas emissions, and labour rights – tremendously important challenges that are all addressed in this annual sustainability report from AAK.

Sustainable growth is fundamental to AAK’s business and a key objective of our strategy. For us, sustainable growth is about our responsibility towards all of our key stakeholders – global and local customers, investors, suppliers, employees, and the local communities in which we operate. We believe that building sustainability into our everyday activities helps us achieve our vision of being the first choice for value-adding vegetable oil solutions.

All of AAK’s CSR policies and codes are based on the UN Global Compact (UNGC) of which we have been a member since 2002. To drive sustainability progress we focus our efforts within five areas – Our Customers, Our Suppliers, Our Planet, Our People, and Our Neighbours. We continuously set and achieve objectives within these areas based on market analyses, our stakeholders’ objectives and our own ambitions and priorities.

In 2015, the United Nations adopted 17 Sustainable Development Goals (SDGs) relevant for all countries. With a very clear agenda on sustainability, we at AAK welcomed these goals and we have incorporated them in our model for sustainable growth. Going forward, we intend to play an active role in contributing to SDG initiatives relevant to our business.

Our Customers
Over the years, we have established long-standing customer relationships built on mutual respect and a thorough understanding of our customers’ needs. An area of major importance both for our customers and us is food safety. We are therefore very proud that all of AAK’s production sites are food safety audited and certified in accordance with one or more internationally recognized food safety standards. In addition, 100 percent of our sites handling palm oil are RSPO (Roundtable on Sustainable Palm Oil) supply chain certified.

Ethical business conduct is another key priority for AAK and our customers. We share our ethical information and ethical audit reports through the Sedex platform. 

Our Suppliers
Sustainable sourcing of raw materials is another top priority among our customers and we continue to increase our focus on environmental and social challenges in the supply chain. Our Supplier Code of Conduct, which is implemented with all of our direct raw material suppliers, addresses important areas such as labour and human rights, environment, and corruption.

In addition to our support and full engagement in the RSPO, we continue to implement our own sustainable palm oil policy. The policy outlines our commitments on sustainable palm in general and specifically requirements for no deforestation and no development on peatlands. There has been strong progress on the implementation of our policy over the last year, especially on our traceability to mill, our supplier risk assessment process, and our commitment to help to transform the supply chain. This is, of course, something we’re very proud of.

We have also continued our relentless work in West Africa towards a more sustainable and efficient supply chain. Our Kolo Nafaso program, which started out as a project in 2009, focuses on support, interest-free micro credits, training and trading directly with the women collecting shea kernels. The program continues to progress and more than 115,000 women are now included in Kolo Nafaso. This is a 27 percent increase compared to last year and we will continue to develop this very successful program.

Our Planet
Our overall resource efficiency has improved for a number of years and 2016 was no exception. Energy consumption, calculated per MT produced, decreased by 6.1 percent despite a strategic decision to increase the production of highly refined products which, all other things being equal, require more energy to process.

Direct carbon dioxide emissions per MT processed decreased by 4.7 percent compared to 2015, and both water consumption and water discharge, calculated per processed unit, were down by 2.2 and 6.7 percent respectively.

These great achievements have been delivered by a very dedicated and responsible global operations organization. Going forward, we will continue to minimize our use of natural resources as well as emissions.

Our People
At our production sites, Lost Time Injury Rate (LTIR) remained at 0.6 with nearly half of the sites not having any Lost Time Injuries at all during 2016. Unfortunately, Lost Day Rate, which is a measurement of the severity of the incidents, increased quite significantly due to two incidents. This matter is being addressed with further initiatives from our Global Safety Team that constantly strives to make AAK a zero injuries workplace.

At our sourcing sites in West Africa, where conditions and challenges are very different, both LTIR and Lost Day Rate decreased significantly. This is a result of widespread safety training aiming to change the culture into a “safety first” mindset.

During 2016, first aid training has been completed at all production sites ranging from basic aid courses to training in the use of AED (Automated External Defibrillator). In West Africa, where the availability of professional assistance can be scarce, these courses have been of utmost importance.

Our Neighbours
As a global company, AAK contributes to the development of the local communities it operates in by creating jobs, paying taxes and doing business with local enterprises. But we also strive to be a good corporate citizen by taking issues such as health and safety, diversity, labour standards, and our environmental impact seriously.

However, we realize that there are a variety of other ways to further engage actively with the local communities. I’m very pleased to see the many ways in which our employees truly engage with their local communities, and the initiatives presented in this report are only a few of those conducted by AAK employees.

Sustainability going forward
It is with a lot of pride we share with you, in this report, all of the significant achievements we continue to make across all of our focus areas. Responsible behavior is both a shared and an individual commitment, and as a global company AAK strives to play its part.

Building sustainability is a continuous job and there are still many challenges ahead of us, working towards full sustainability in the palm oil supply chain being one of the more significant ones.

Going forward, we will continue to incorporate and integrate new AAK production sites in our global CSR system, we will continue to set and achieve objectives within our focus areas, and we will, above all, continue to grow our business in a sustainable way.

Fredrik Nilsson, CFO and acting CEO

Link to CSR policy





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