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Governance

Management approach

At Electrolux, everything we do and all the decisions we make must be governed by the principles of ethics, integrity and respect for people and care for the environment. This affirms our commitment to sound and universal ethical business practices.

Our business model

To achieve our Purpose – to shape living For the Better – and drive profitable growth, Electrolux uses a business model that focuses on delivering best-in-class consumer experiences in taste, care and wellbeing. The objective is to create a steady stream of consumer-relevant innovations under strong brands in key experience areas. We focus on enabling great-tasting food, great care for clothes and healthy wellbeing in the homes of consumers.

Sustainability integrated into our business

Sustainable development is defined as a transformational driver in our business model, as we recognize the growing importance of sustainability performance and reputation – including the impact of our business and products on the planet. Electrolux is acknowledged as a sustainability leader.

As an endorser of the UN Global Compact, Electrolux abides by universal principles, including the environment, labor and human rights through Group codes and policies, both internally and among suppliers. The following tables cover Global Reporting Initiative (GRI) topics that are deemed as being material to Electrolux.

The most relevant topics are integrated into our For the Better 2030 Goals and our approach and progress are outlined under each related Goal in the Key Priorities and Progress 2021 section. The aspects have been combined if they have a common management approach or policy.

For the Better 2030

Our sustainability framework - For the Better 2030 - was based on our materiality analysis. Read more about our material sustainability topics in the Our materiality process section. Read about our Goals and our performance on them in the Key Priorities and Progress 2021 section.

Sustainability governance

Our sustainability framework – For the Better 2030 – is directly overseen by our Group management through the Sustainability Board, and by the business area management teams through various reference groups and steering groups.

The Electrolux Sustainability Board is an important forum to discuss and decide on sustainability action throughout the Group. The board is an essential part of our ability to deliver our sustainability targets going forward. 

The legal sustainability reporting as part of the Annual Report is approved by the board. Group management has also adopted policies concerning Environment, Workplace, and Anti-Corruption, while the board has endorsed the Electrolux Code of Conduct.

Each business area is responsible for contributing to the fulfillment of Group targets under our nine Goals and several of the KPIs are broken down and followed up at business area level.

Group Sustainability is our expert function that drives the development of our sustainability agenda by supporting sustainability integration throughout our operations and monitoring performance, in close collaboration with business area Sustainability Directors. Group Legal Affairs is responsible for implementing our Anti-Corruption Program. The Electrolux global Ethics Helpline (our whistleblower function) and the Ethics Program are overseen by the Ethics & Human Rights Steering Group.

Policy framework

EnvironmentSocial, labor and human rightsAnti-corruption
PoliciesElectrolux Code of Conduct
Environmental PolicyWorkplace PolicyAnti-Corruption Policy
Workplace PolicySupplier Workplace StandardConflict of Interest Policy
Workplace Directive 
Central areasProduct designChild and forced laborConflict of interest
Efficiency in operationsHealth and safety, working hours, compensationBribes or other improper benefits
Influencing legislationDiscrimination and harassmentBusiness partners
Environmental management systemsFreedom of association, collective bargainingPolitical contributions

Evaluation of our management approach

Our progress on topics is tracked according to our defined targets. As described in Our materiality process, an annual materiality review is undertaken - including both the scope and focus of our "For the Better 2030" sustainability framework. An annual evaluation of external influences is performed in relation to each Goal. The management and effectiveness of our Goals are defined by how we measure progress. The next steps for each Goal define the necessary actions to reach them.

For more information on the effectiveness of the specific actions, see Key Priorities and Progress 2021.

For more information on external influences, see Global megatrends that shape our business.

Economic

For information regarding our economic management and reporting practices, see Annual Report: Note 1 Accounting principles. For our work on anti-corruption, see Act ethically, lead in diversity and respect human rights.

Anti-corruption, anti-competitive behavior

Electrolux commitments

Specified in the Code of Conduct, Anti-Corruption Policy and Anti-trust Policy.

Electrolux responsibility and resources

The Corporate Legal department is responsible for our Anti-Corruption and Anti-Trust policies, and for their communication and follow up. Employees are educated in our policies through online and face-to-face training. We internally investigate reports of corruption cases. The Ethics program, including the Ethics Helpline, is a cross-functional initiative, led by HR together with Group Sustainability, Group Legal and Internal Audit with oversight by the Ethics & Human Rights Steering Group. 

Our approach and progress in 2021

Read more in our Goal Act ethically, lead in diversity and respect human rights.

Environment

Electrolux applies a product lifecycle approach to managing environmental impacts, which considers the entire lifecycle – from supplier impacts to transport, manufacturing and use. We also apply the precautionary principle, whereby we act responsibly despite not having the full scientific knowledge of negative impacts, to ensure we stay ahead of potential risks.

Environmental management

Each business area is required to implement an environmental management system throughout its operations, and all operations with over 50 employees are expected to have ISO 14001 certification.

Auditing and Monitoring outlines how operations and suppliers meet Group expectations and commitments.

Level of ISO 14001 certification

The proportion of factories with more than 50 employees that have certified ISO 14001 management systems.

Transport

Electrolux commitments

Electrolux is an active partner in the Business for Social Responsibility Clean Cargo Working Group, and is represented on its steering committee.
All Electrolux sea transport providers must be a member of the working group, which enables us to standardize emission calculations. Workgroup members account for over 85% of all global shipping container freight.

Electrolux responsibility and resources

Responsibility lies with each business area. Action is monitored and coordinated through our Group Sustainability function.

Our approach and progress in 2021

Read more in our Goal Drive supply chain sustainability.

Materials

Electrolux commitments

We are increasing our use of recycled materials, which helps us make better use of resources, reduce our environmental impact, and promote the circular economy.

Electrolux responsibility and resources

Our internal Recycling Taskforce includes representatives from each Electrolux sector, purchasing, R&D, production and product lines to define the scope of our work as well as targets and action.

Our approach and progress in 2021

Read more in our Goal Offer circular products and business solutions.

Energy

Electrolux commitments

Electrolux is committed to use energy in the most efficient way.

Electrolux responsibility and resources

We continuously work to reduce our energy use through technological investments in new equipment, employee awareness and behavioral change, and by implementing best practice throughout our operations. Our Green Sprit program, including our Green Sprit rating and certification system, is also crucial in driving energy efficiency.

Our approach and progress in 2021

Read more in our Goal Be climate neutral and drive clean and resource-efficient operations.

Water

Electrolux commitments

Electrolux is committed to use water in the most efficient way.

Electrolux responsibility and resources

We have comprehensive processes to minimize water use in our operations – particularly at our factories in water scarce regions. Our Green Spirt program involves sharing best practice, monthly reporting on water performance indicators as well as conducting water mapping. 

Our approach and progress in 2021

Read more in our Goal Be climate neutral and drive clean and resource-efficient operations.

Emissions

Electrolux commitments

Electrolux has approved science-based CO2 emissions targets in place. This include the phase-out of high-impact greenhouse gases and ozone-depleting substances.

Electrolux responsibility and resources

The Operational Resource Management Team coordinates the shift to renewable energy and the reduction in relative energy use. R&D implements long-term product plans.

Our approach and progress in 2021

Read more in our Goal Be climate neutral and drive clean and resource-efficient operations and Our Climate Targets.

Waste

Electrolux commitments

Our Zero Waste to Landfill program has the objective to reduce the amount of waste sent to landfill or incinerated without energy recovery. 

Electrolux responsibility and resources

The global Electrolux Zero Waste to Landfill program covers all our factories around the world. The program aims to find opportunities for material reuse and recycling and at the same time decrease the amount of waste sent to landfill and/or to incineration without energy recovery.

Our approach and progress in 2021

Read more in our Goal Be climate neutral and drive clean and resource-efficient operations.

Supplier environmental assessments

Electrolux commitments

Our commitments are clearly outlined in the Supplier Workplace Standard and Workplace Directive. Compliance is mandatory and non-negotiable for our suppliers, which is stated in our supplier contracts. The main OEM and ODM suppliers must measure and report their energy and water use through the energy reporting standard. They are also expected to assess their water impacts according to the WWF Water Risk Filter. 

Electrolux responsibility and resources

Global, category or business area Sourcing Boards are responsible for assessing prospective suppliers, and Purchasing Directors are responsible for ongoing compliance and performance, with support from the Responsible Sourcing Team and Group Sustainability.

Our approach and progress in 2021

Read more in our Goal Drive supply chain sustainability.

Social

We support labor rights according to the ILO Core Conventions and the Declaration on Fundamental Principles and Rights at Work, and have an International Framework Agreement with unions that affirms our labor commitments. Our Code of Conduct includes our Human Rights Policy Statement, and how we fulfill these commitments is further detailed in a Human Rights Directive. The Workplace Policy, the Supplier Workplace Standard and the Workplace Directive apply to our operations and our supply chain and include key requirements concerning labor standards.

The section on Auditing and Monitoring outlines how operations and suppliers meet Group expectations and commitments.

Investment

Electrolux commitments

Human rights screening is included in our acquisition processes, as specified in our guideline "Human rights risks in acquisitions". 

Electrolux responsibility and resources

Responsibility lies with each project team, supported by Group Legal and Sustainability functions.

Our approach and progress in 2021

Read more in our Goal Act ethically, lead in diversity and respect human rights.

Non-discrimination, child labor, forced or compulsory labor

Electrolux commitments

Policy commitments are part of our Code of Conduct and Workplace Policy and People Policy.

Electrolux responsibility and resources

Each business unit's line management has the responsibility to ensure that our Code of Conduct and Group policies are abided by. This includes the communication of requirements within their unit through training, and annually assessing the unit's performance.

Our approach and progress in 2021

Read more in our Goal Act ethically, lead in diversity and respect human rights.

Occupational health and safety

Electrolux commitments

Our health and safety commitments are specified in our Code of Conduct and Workplace Standard.

Our Safety Management System covers all manufacturing facilities. Each facility has a plan to contribute to the Group-wide goal. The overriding aim is to prevent injuries from occurring in the first place.

Electrolux responsibility and resources

The Group Operations safety team defines goals, monitors progress, shares best practice and implements the monthly recording system and daily incident reports, to align according to production, regions and product lines. Furthermore, there are Occupational Health and Safety committees at all our manufacturing facilities.

Our approach and progress in 2021

Read more in our Goal Act ethically, lead in diversity and respect human rights.

Training and education

Electrolux commitments

A focus area of our People Plan is to truly become a learning organization. Our training and education program is built on the 70-20-10 learning model: 70% through challenging assignments and on-the-job experience, 20% through relationships, networks and feedback, and 10% through formal training.

Electrolux responsibility and resources

Responsibility lies with each unit's line management, supported by our business areas and functions, in close collaboration with Group HR.

Our approach and progress in 2021

We continue to provide a global portfolio of leadership development programs aligned with our business strategy. Additional development is provided through improving our digital learning solutions and other learning initiatives.

Employment, diversity and equal opportunities

Electrolux commitments

Our commitments are specified in the Code of Conduct, People Policy and Workplace Policy. The Group's People Plan, which is a component of the Business Strategy - describes our aim to become a high-performing learning organization with the right people in the right jobs. Mandatory directives are in place to ensure fair hiring and compensation practices, for example the Recruitment Directive, the Compensation Directive and the Grandparent Principle Directive.

Electrolux responsibility and resources

The Senior Vice President of Human Resources and Communications is responsible for HR-related policies. The implementation of policies and remuneration are managed by the business areas.

Through performance appraisals and talent reviews, we evaluate employee performance and development, while promoting diversity and equal opportunities.

Employees set annual objectives and development plans that are followed up in one-to-one meetings between manager and employee. Managers are responsible for succession management, aimed at securing the necessary skills for the future, by connecting the talent pipeline and the employee development plans. Through the talent planning process for the top 200 positions, opportunities for promoting women are constantly reviewed.

Efforts are in place to connect talent acquisition closer to business planning, including headcount data and forecasting. Strategic workforce planning is in the pipeline for global implementation in the coming years.

We are transitioning to become more data driven and have implemented systems that track e.g. gender distribution, turnover, metrics for people processes, that form the basis for designing improvement actions. We focus on attracting, developing and retaining women for leadership roles.

Our approach and progress in 2021

Read more in our Goal Act ethically, lead in diversity and respect human rights.

Labor & management relations

Electrolux commitments

Labor and management relations are specified in our Code of Conduct and Workplace Standard. Our strategy is informed by the International Framework Agreement with the Swedish trade unions IF Metall, Unionen and IndustriAll, which underlines our commitment to ILO conventions and common global standards.

Electrolux responsibility and resources

Country and local line organizations are responsible for realizing the strategy, supported by HR Country Managers and Group Labor Relations.

Our approach and progress in 2021

Read more in our Goal Act ethically, lead in diversity and respect human rights.

Supplier assessment for labor practices and human rights

Electrolux commitments

Specified in the Supplier Workplace Standard and Workplace Directive.

Compliance is mandatory and non-negotiable for suppliers, and stated in the supplier contract.

Electrolux responsibility and resources

Global, category or business area Sourcing Boards are responsible for assessing prospective suppliers, and the responsible Purchasing Director is also responsible for ongoing compliance and performance, with support from the Responsible Sourcing Team and Group Sustainability.

Our approach and progress in 2021

Read more in our Goal Drive supply chain sustainability.

Security practices

Electrolux commitments

Our security practices are specified in the Workplace Policy, Supplier Workplace Standard and Workplace Directive. We also have a Security Program that covers selection criteria for security providers as well as incident reporting.

Electrolux responsibility and resources

Unit line management is responsible for fulfilling the Security Program locally, supported by Group Security.

Our approach and progress in 2021

Security inspections are performed locally, based on risk and in accordance with our Security Program.

Security requirements are included in Workplace Policy training for employees, as well as in the Workplace Policy audits of our manufacturing units.

Grievance mechanisms for labor practices, human rights

Electrolux commitments

Employees can report misconduct confidentially and anonymously (where legally permitted) through our confidential reporting mechanism – the Ethics Helpline. Suppliers can report possible non-compliances through the Supplier Workplace Standard mailbox

Electrolux responsibility and resources

The Ethics and Human Rights Steering Group is responsible for the grievance mechanism. Trained investigators conduct the investigations, in line with our confidentiality and integrity principles.

Our approach and progress in 2021

Read more in our Goal Act ethically, lead in diversity and respect human rights.

Public policy

Electrolux commitments

The Group External Affairs Committee, including representatives from the business areas, coordinates positions and other public affairs matters.

Electrolux responsibility and resources

Group Management and functional heads have the overall responsibility for our public policy. Each business area is responsible for engaging with their respective policy makers. Public policy initiatives are primarily conducted through industry organizations, such as the European Appliance Industry Association (APPLIA) and the Association of Home Appliance Manufacturers in the United States and Canada (AHAM), the Australian Consumer Electronics Association and the Associação Nacional de Fabricantes de Produtos Eletroeletrônicos (Eletros) in Brazil.

Key policies affecting our business:

EU
Revision of the EU energy label and energy efficiency legislation (eco-design legislation)
EU legislation on circular economy and resource efficiency
Forthcoming EU legislation on plastics
EU waste and chemical legislation
Changes to the CO2 trading scheme (ETS) and a Carbon Border Adjustment Mechanism (CBAM)
Strengthened legislation for batteries
EU taxonomy
Smart appliances, data security and privacy
The Corporate Sustainability Reporting Directive (CSRD)
Forthcoming EU directive on Human Rights and Environmental Due Diligence

North America
Trade Relations with China
Department of Energy (DOE) appliance standard rulemakings
E-Star Standards
Chemical Regulations including those related to PFAS
Packaging EPR
Plastic Pollution
Repair Regulations

Asia Pacific
Waste and packaging (CN, AU)
Chemical regulations (SEA)
Cyber security regulations and incentives (AU)
Trade relations with China and potentially the EU (AU)
Ratification of the RCEP (Regional Comprehensive Economic Partnership) between all 10 ASEAN countries plus China, Japan, South Korea, Australia and New Zealand

Latin America
Recycling program structuring in Brazil
Discussion in the Mercosur trade block on a free trade agreement with South Korea
New energy efficiency labelling for refrigerators in Brazil