Sustainability report 2022

Sustainability report 2022

The Höganäs sustainability agenda

Höganäs is the world leader in the metal powders market with a yearly production capacity of 500,000 tonnes. We operate 17 production centres across the globe and have a workforce of 2,400 employees.

At Höganäs, we work to continuously decrease our negative impact, while strengthening the positive effects of our business. To gain momentum in our sustainability work we focus on five areas, all of them interlinked, and reinforcing each other. Although we have an emphasis on Climate, the other focus areas Products, Workplace, Environment and Society balance our efforts to cover our material topics and contribute to achieving our climate targets.

Our sustainability agenda is an integral part of our business strategy and crucial for our success going forward. We focus on being a role model and a forerunner in our industry by setting ambitious targets and leading through example, long-term partnerships and innovative solutions.

Climate – To counter climate change, Höganäs works proactively to mitigate carbon dioxide emissions generated in our operations and throughout the value chain, accelerating towards our long-term net-zero target.

Environment – Höganäs is working to promote healthy eco systems by minimising the environmental impacts from our production and from the materials and chemicals we use. We work proactively to support biodiversity, and contribute to clean water, air, and soil.

Höganäs sustainability strategy∎ Products – By lowering our products’ carbon footprint, becoming more circular, and using resources and energy more efficiently, we contribute towards a more sustainable society and help our customers do the same.

Workplace – By creating good and safe working conditions, being inclusive, and by promoting gender equality, Höganäs aims to set an industry example and continue to be an employer that attracts and retains the right competence and skills.

Society – By being committed to high ethical standards in everything we do, including our sourcing, financial reporting, tax payments, and our responsibility towards external stakeholders and the local community, we contribute to building a better society for all.

Countering climate change

Science is clear – the effects of climate change are shaping not only how business is conducted in the future, but the future itself.

Our Climate Roadmap is a strategic plan to reach net-zero. During 2022, local action plans have been developed for each production site, which show a potential to lower greenhouse gas emissions by 90 percent across scope 1 and 2. During the year we also formed working groups and ways of working to reduce scope 3.

  • Process-related carbon dioxide emissions from raw materials make up 72 percent of our scope 1 emissions. During 2022, process-related carbon dioxide emissions from raw materials decreased by 11 percent compared to 2021.
  • Carbon intensity per produced tonne has decreased to 0.62 in 2022 compared to 0.69 previous year (including scope 2). The main reason is the increase in fossil free electricity, and more efficient energy utilisation in our production processes.
  • Our target is to increase our energy efficiency by 1 percent per year. During 2022 we achieved this by 3 percent.

Fostering a safe and inclusive culture

We aim to be at the forefront when it comes to good working conditions and employee development.

This year we have increased our focus and knowledge about diversity and Inclusion by participating in the UN Global Compact’s Target Gender Equality Programme.

Our ‘Code of Conduct’ outlines our core principles and how they relate to labour standards and human rights in our workplaces around the world. Almost all our co-workers, 97 percent (97) have a full-time position, and 98 percent (98) have permanent contracts.

‘Safety first’ sums up our aim to create a solid safety culture, where dialogue and risk-elimination are key. Our objective is to reduce work-related injuries and cases of ill health to zero.

  • During 2022, there were 30 (22) lost time injuries (LTI), resulting in an LTI frequency of 6.9 (5.0) per million hours worked. The safety performance has plateaued, and further actions have been taken to strengthen the safety culture.
  • We initiated Safety Maturity Assessments across our sites in Europe and the assessments will continue in 2023.
  • Our plants in China, South Korea and Japan were certified according to the ISO 45001 Occupational Health and Safety Standard. This means all sites with production now have third party certified health and safety management systems.
  • We introduced the Safety Toolbox across all our production sites, and in ten out of 17 sites the toolbox is already implemented.

Do more with less

Within the metals industry, powder metallurgy is well known as a versatile production technology that offers unique possibilities with benefits for sustainability.

Besides being energy efficient and requiring less raw materials, the amount of waste generated is usually less than from conventional techniques.

We are striving to lower our products’ total carbon footprint by transitioning to fossil free production processes, using input materials with a lower carbon footprint such as secondary raw materials, and by creating circular material flows.

  • We launched Astaloy CrS, a pre-alloyed and fully recyclable metal powder, based on recycled iron products.
  • We have committed resources to provide high quality data on our products by using Life Cycle Assesment (LCA) as a method of choice.
  • We have focused our initial LCA activities on the products we produce at our plants in Halmstad and Höganäs in Sweden, and in Laufenburg in Germany.

Enable balance with nature

The steel and metals industry provide essential materials for many basic needs and is a vital part of the global economy and societal development.

We strive to minimise any harm to the environment from our operations and aim to strengthen our understanding of both ecosystem impacts and services, and to have a positive impact where possible.

  • In 2022, Höganäs built a water treatment station in Brazil able to store and treat both rainwater and process water through ozone treatment. The unit will be able to reuse 43,000 cubic metres of water annually.
  • In Halmstad, Sweden we invested in a new reversed osmosis unit. This is expected to save approximately 20,000 cubic meters of municipal fresh water per year. Also, an upgrade of the ladle furnace transformer will save 30,000 cubic meters municipal tap water per year.
  • We mapped biodiversity and ecosystem services around the plant in Höganäs Sweden during 2020 and 2021. The pilot study looking at the most effective way to track changes in the nature was conducted in 2022.

Build long-term partnerships

As the world leader in the iron and metal powders markets, our business touches millions of people, either through our activities, by using our products or because of our business relationships at any level of our value chain.

Paying fair tax and salaries are an important part of our contribution to society. In 2022, we paid MSEK 162 (226) in taxes globally.

Our salaries and social security expenses amounted to MSEK 2,109 (1,935) during the year. We always strive to ensure compliance with transparency requirements and avoid any transactions or arrangements that may be considered tax evasion.

We encourage all our production sites to engage with local communities according to our ‘Group Framework for Community Engagement and Donations’ and make prioritisations according to local circumstances. In 2022, some examples of initiatives were delivering food baskets to families in need and collecting winter clothes to the local community in Brazil, participation in a soup kitchen in Taiwan, pre-preservation of German forests and a donation to Ukraine.