THE YEAR SUMMARIZED BY JONAS SAMUELSON (JS), PRESIDENT AND CHIEF EXECUTIVE OFFICER, AND HENRIK SUNDSTRÖM (HS), VP SUSTAINABILITY AFFAIRS.
What has 2019 meant for the company's sustainability agenda?
JS: Sustainability has gone from being very important to crucial for Electrolux, as our planet approaches several extremely significant tipping points. This is why we launched the Better Living Program in 2019 and why we will take our sustainability framework to the next level in 2020 and beyond.
HS: The Better Living Program is an integral part of our new For the Better 2030 sustainability framework, which will enable Electrolux to continue to create better and more sustainable living for people around the world through to 2030. With bold targets focusing on better eating, better garment care and a better home environment, as well as to become climate neutral in our operations and strive towards a more circular business, the program intensifies our contribution to key global challenges.
What are the main sustainability challenges ahead?
JS: I think our main challenge is meeting consumer expectations and demands while making more sustainable behavior mainstream. This might be helping people to reduce food waste, or making their clothes last longer through better fabric care, which are both now an important part of our strategy.
HS: The Better Living Program and For the Better 2030 will help us to concretize our purpose to shape living for the better by making life more enjoyable and sustainable for people. They will also help us tackle challenges head on by being prepared for the major challenges facing our business and society as a whole.
What is being done to implement and deliver on the 2030 targets?
JS: Last year we set up the Sustainability Board, which will be an important vehicle for delivering our targets by optimizing resources and action. We are also continuing to integrate our climate targets into our business, for example through our large investments like the one in North America completed in 2019 that will have a great impact.
HS: We are starting to define early in the product development process how our new products will help us accomplish our targets. This involves having a more consumer centric focus from the R&D phase.
How will the Better Living Program drive the Electrolux sustainability agenda until 2030?
JS: As a global leader in household appliances, Electrolux has a tremendous opportunity to eliminate the barriers that prevent consumers and the industry from making sustainable choices. That’s where the Better Living Program comes in. It’s part of our For the Better sustainability framework and will be an engaging way to communicate with consumers.
HS: We are on track to meet many of our ambitious 2020 sustainability targets. But the Better Living Program steps up our commitment to sustainability and contribution to key global challenges by building on our 2020 targets with at least 100 bold actions for 2030. In this way, the program turns the Electrolux purpose into action – to ensure that the company continues to shape better living today, tomorrow and for another 100 years.
Does the For the Better 2030 align with the global sustainability agenda?
JS: Our new sustainability framework is more aligned with the UN Sustainable Development Goals. The UN Global Compact also continues to reinforce our sustainability work, and we are a long-term signatory of its ten principles.
How has Electrolux stepped up its climate action in 2019?
JS: I was proud to sign the global ‘Business Ambition for 1.5°C’ pledge on behalf of Electrolux at the UN Climate Action Summit in New York in September. During the year, we also joined the Cool Coalition initiative, which works to accelerate the adoption of refrigerants with less Global Warming Potential in refrigerators, freezers and air conditioning units.
HS: As part of our new objective to make our business circular and climate neutral, we launched two new climate targets during the year. These longer-term targets build on our 2025 science-based climate target and aim for climate neutral operations by 2030 and a climate neutral value chain by 2050. Taking action on climate change is essential, both for our business and for society.
How is your climate reporting aligned with the latest best practice?
JS: We are implementing the European Commission’s Guidelines on reporting climate-related information, which is part of the Commission’s action plan on financing sustainable growth. Our aim is to provide investors and lenders with consistent climate-related financial risk disclosures.
HS: As part of this we are currently aligning our climate reporting with the recommendations from the Task Force on Climate-related Financial Disclosures (TCFD) issued by the Financial Stability Board (FSB). This mainly focuses on identifying the financial consequences from our risks associated with climate change.
What are you most proud of in terms of products launched during the year?
JS: Our new multi-door refrigeration platform offers features such as chiller drawers and seal crispers that keep ingredients fresher for longer. I am also proud of our new products where we have managed to phase out global warming refrigerants.
HS: We launched the QuickSelect dishwasher interface that intuitively indicates to the user how they can save energy and water – to gently encourage the consumer to make more sustainable choices. We also launched washing machines with UltraCare technology that saves energy by allowing washing at lower temperatures. Significantly, our most efficient products consistently achieve a higher profit margin than standard products – accounting for 23% of total units sold by Electrolux in 2019 but for 32% of our gross profit.
What does the new Electrolux green bond framework mean for the business?
JS: We developed our new green bond framework in alignment with the Green Bond Principles 2018 – and I am proud to say that we are the first to do so in our sector. In March, we issued our first SEK 1 billion green bond to fund climate investments and other projects that support the Sustainable Development Goals.
HS: The purpose of the green bond framework is to finance investments that improve product performance and efficiency, make better use of resources, eliminate harmful materials, achieve more with less or contribute toward our climate targets. During the year, the bonds financed our investment in our North America operations, which has improved efficiency and reduced greenhouse gas emissions.
How is circularity becoming more important to Electrolux?
JS: I believe circularity presents significant opportunities for us to tap into new markets and extend the lifetime of our products by creating circular business models, such as our new fixed price repair services in Europe, and our new subscription-based model for our award-winning Pure i9 robotic vacuum.
HS: During the year, we received funding from Vinova to test a new leasing concept for Electrolux to maintain and optimize the lifetime of washing machines for municipal housing companies in Sweden. We also joined forces with Stena Recycling on the new ‘Circular Initiative’ where we shared good practice with other leading companies and demonstrated a smart robot that dismantles old Electrolux vacuum cleaners and collects recyclable fractions.
What progress was made with the Electrolux non-profit Food Foundation during the year?
JS: The Electrolux Board approved funding to the Food Foundation as part of our 100-year anniversary celebrations and intends to provide 100 million SEK until 2030. This will allow us to drive the foundation’s work with a more long-term commitment to promote the much needed shift to sustainable cooking and eating habits globally.
HS: During the year, the Food Foundation replicated its successful concepts around the world. For example, the 'Food Heroes' initiative educated 30,000 people on sustainable eating, and the 'Like a Chef' professional training program is now active in Brazil, Russia, Sweden, Poland, Egypt and Ukraine.
Electrolux is a leading global appliance company that has shaped living for the better for more than 100 years. We reinvent taste, care and wellbeing experiences for millions of people around the world, always striving to be at the forefront of sustainability in society through our solutions and operations. Under our brands, including Electrolux, AEG and Frigidaire, we sell approximately 60 million household products in approximately 120 markets every year. In 2019 Electrolux had sales of SEK 119 billion and employed 49,000 people around the world.
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