Corporate sustainability is imperative for long-term value creation. By helping to develop successful, responsible and sustainable companies, we promote long-term sustainable development in the communities our companies work in. This, in turn, creates greater shareholder value over time, which is the essence of our business. In our role as active owner we monitor and take an active involvement in the long-term development of our portfolio companies.
Sustainability today is a strategic and business-critical issue – from the environmental, social and economic perspectives. Issues such as the environment, social conditions, working conditions, respect for human rights, diversity, business ethics and anti-corruption are fundamental areas that must be taken into account in highly integrated sustainability work.
Industrivärden's ambitions as active owner
Like other strategic matters, sustainability aspects in the portfolio companies are handled within the framework of Industrivärden’s active ownership process. In 2016 Industrivärden initiated development work aimed at strengthening analysis and our ability to influence sustainability-related matters. The new framework revolves around four core perspectives: organization and governing frameworks, information and communication, sustainability for value-creating business opportunities, and risk management.
Industrivärden’s portfolio companies operate in widely diverse sectors and thus the preconditions, challenges, opportunities and actions also differ from company to company. However, Industrivärden’s overarching ambitions from a sustainable, long-term ownership perspective are the same for all of the companies.
As an active owner Industrivärden has an expectation that the portfolio companies
- treat sustainability as a vital strategic opportunity,
- integrate sustainability aspects in their business models, strategies, processes and product offerings,
- comply with applicable laws, rules and regulations, and generally accepted principles for corporate social responsibility,
- continuously improve their work with the support of relevant guidelines and measureable results, and
- communicate their sustainability work, including the ways in which they are contributing to long-term sustainable development in the communities they work in.
Against this background we put major emphasis on ensuring that the portfolio companies have the boards, leadership, organization and resources required to integrate corporate social responsibility and thereby longterm value creation in their business models, processes and product offerings.
All of Industrivärden’s portfolio companies are participants in the UN Global Compact, where they have committed themselves to respecting and adhering to principles surrounding human rights, labor, the environment and anti-corruption in their operations. The portfolio companies also work – according to their own conditions – to contribute to the achievement of the global goals of the UN’s 2030 Agenda for Sustainable Development.
Industrivärden’s portfolio companies have generally made great progress in capitalizing on the value potential inherent in long-term corporate sustainability and score highly in various industry peer comparisons. As a few examples:
- In 2016 Sandvik was once again included in the Dow Jones Sustainability Index, as recognition that Sandvik is among the top 10% of companies in its industry worldwide regarding performance based on economic, environmental and social criteria.
- Volvo is today the only global vehicle manufacturer that has qualified for WWF’s (World Wildlife Fond) Climate Savers program. Among other things, Volvo has the long-term ambition to have entirely CO2-neutral production plants.
- Ericsson adheres to – and was one of the first in the world to begin adhering to – the UN Guiding Principles (UNGP) Reporting Framework on Business and Human Rights in its sustainability reporting.
- In 2016 SSAB – in partnership with LKAB and Vattenfall – initiated an industrial development project to develop a steel production process that emits water instead of carbon dioxide. Environmental and sustainability issues are inherent in SSAB’s long-term strategy, and through this initiative SSAB is working toward the vision of a carbon-neutral Sweden.
Own operations should serve as a model
Industrivärden aspires to be a positive force in society that contributes to sustainable development through its operations. We act towards the overall goal of giving our shareholders a competitive return on their investment. This work is conducted with a focus on our shareholders’ and other stakeholders’ interests as well as our overarching environmental, social and economic impact on society. The Company should serve as a model and adhere to the same sustainability principles in its own operations that it advocates for its portfolio companies.
Proactive sustainability work is to be an integral part of daily activities. By engaging in a continuous dialog on sustainability aspects with representatives of existing and potential shareholders and other stakeholder groups we can embrace new perspectives at the same time that we share our own experiences. Dialog and collaboration are essential since sustainability aspects permeate all parts of society.
A starting point for our own sustainability work is the Code of Conduct that was adopted in December 2015, which lays out the Company’s ethical values and serves as guidance for how individuals who are active in Industrivärden are to act in the performance of their duties. Among these values, we are committed to diversity, reject all forms of discrimination, and carry on an open dialog with our stakeholders.
Through our participation in the UN Global Compact, at Industrivärden we have committed ourselves to acting in line with the Compact’s ten principles.
Even though Industrivärden is a relatively small company with approximately 20 employees, we have an express ambition to minimize our own climate impact. Toward this end, for a number of years we have been reporting in accordance with the CDP framework. By making environmentally smart choices in purchasing, using rail instead of air for business travel as far as possible, mass transit instead of personal cars, and only using renewable energy in our offices, we have succeeded in reducing our carbon emissions. Industrivärden climate compensates for its climate impact.