Sandvik has developed a new sustainability strategy that sets its vision for the future. The new strategy explains how Sandvik will contribute to creating a responsible world and ensure business success.
The new Sandvik sustainability strategy is a comprehensive update of the sustainability shift strategy that was launched in 2019.
“We are leaning on the good work that has already been done,” says Mats W Lundberg, Head of Sustainability, Sandvik. “But the field of sustainability is evolving. It is becoming more mature with new legislation and increasing customer, shareholder and employee expectations. We need to evolve with it and meet the new demands.”
The structure of Sandvik has also changed since 2019. Sandvik Materials Technology was separated and listed on Nasdaq Stockholm as Alleima, and Sandvik has acquired many new companies. Hence the need for a sustainability strategy that reflects the new Sandvik.
Focused on creating value
The new strategy shows that Sandvik is taking its responsibilities seriously as well as taking on a leadership role. “We have focused much more on our contribution and how our businesses create value”, says Lundberg. “The new strategy is connected to the Sandvik purpose of advancing the world through engineering, it is forward leaning and shows that Sandvik wants to be a positive driving force.”
The updated strategy broadens the scope of the four previous focus areas and includes two new areas, ecosystems and sustainable solutions (see below).
If we can contribute with sustainable solutions in these areas we can have a massive impact on sustainability outside of our own operations
“For any product to be truly sustainable, the entire value chain needs to be sustainable, from raw material sourcing to the manufacturing and usage of the products,” says Lundberg. “And we operate in important and relevant areas here; the mining and processing of raw materials and the machining. If we can contribute with sustainable solutions in these areas we can have a massive impact on sustainability outside of our own operations.”
The previous climate goal has been changed to a net zero goal. This is related to the fact that Sandvik has committed to science-based targets for reducing greenhouse gas (GHG) emissions. They include reducing scope 1 and 2 GHG emissions by 50 percent by 2030, with 2019 as the base year, and to reduce absolute scope 3 emissions by 30 percent. “Our commitment also includes becoming net zero by 2050,” says Lundberg.
Lundberg emphasizes that the updated sustainability strategy is also a business sustainability strategy. “It is deeply connected to business opportunities and us providing innovative sustainable solutions for our customers and society,” he says. “We believe that our biggest contribution is to help our customers make a sustainable transition through the solutions that we provide. Everything we do therefore, from R&D to production to sustainable sourcing, needs to be thought through and connected.”
We reduce risk and increase business opportunity, brand value and shareholder value
“By getting our sustainability strategy right, we are also vaccinating the system against the bad and promoting the good in one go,” Lundberg adds. “We reduce risk and increase business opportunity, brand value and shareholder value. Companies who fail to meet legislative demands will be fined or barred from operating in certain markets. They will lose customers – who increasingly put demands on their supplier’s sustainability credentials – and lose investors, eventually going out of business.”
Starting at the end
Another new aspect of the updated strategy is the future vision for each industry Sandvik works with.
I wanted to start at the end point, the Paris Agreement and the need to be net zero by 2050
“When designing the updated strategy, I asked everyone I talked to across Sandvik to think about what their industry, business and offering will look like in a sustainable future,” Lundberg says. “I wanted to start at the end point, the Paris Agreement and the need to be net zero by 2050. We are committed to this agreement and it is only 26 years away. By starting at the end, we can work out exactly what we need to start doing right now to get there. What will, for example, the sustainable mine of the future look like and how can we contribute to it.”
We want to be responsible and to contribute our piece to this big puzzle
For Lundberg, this is a fresh approach for a business. “It shows that Sandvik understands the world,” he says. “We want to be responsible and to contribute our piece to this big puzzle. Hopefully our customers will see that we have a plan and are heading in the right direction, and be inspired to collaborate with us on this journey.”
The 2025 and 2030 goals set out in 2019 will stay the same. Over the next year, Sandvik will develop new goals and targets for 2040 and 2050 and refine the strategy even further. This will also include more individual goals and targets relevant to each business area as opposed to the previous more general approach.
The updated Sandvik sustainability strategy with its future vision for industry can be seen at home.sandvik
The six focus areas in the strategy
- Sustainable solutions – a new focus area, strongly connected to customers’ businesses and the Sandvik purpose: We make the shift – advancing the world through engineering.
- Ecosystems – another new area related to how Sandvik works with partners across the value chain to regenerate biodiverse ecosystems, aid water stewardship and reduce pollution.
- Circularity and resource efficiency –the goal reflects the aim to do more with less and adopt resource efficiency as a mindset.
- Net zero – Sandvik has committed to science-based net zero targets which were approved by the Science Based Targets Initiative in September 2023
- People and communities – how Sandvik relates to the communities where it has operations and products.
- Responsible business – how Sandvik operates responsibly throughout the value chain.