Sustainability management at Nokian Tyres

Sustainability management and development actions 2015

Sustainability management at our company is handled at the Group level. When developing operations, we aim at solutions that are more advanced than the minimum required by the legislation and standards. Our activities follow the principles of sustainable improvement and are based on the social responsibility assumed by our company, as well as the strategic goals of our business. At the same time, we secure our business, create added value, and enhance its critical success factors: the development, manufacture, and marketing of tyres. We have especially strived to ensure the continuity of our manufacturing operations by promoting the EHSQ functions. By minimising risks and interference, we can ensure cost-efficient production.

We have a broad view on sustainability. We pay attention to the entire lifecycle of our products and to all of our company’s activities. We emphasise the management of sustainability issues in our own operations as well as in our distribution chains. In terms of direct competitive advantages, this means safety innovations for tyres. Sustainable safety is an important dimension in our research and development activities, as well as our main argument in marketing.

In April 2015, we reorganised our sustainability management. To coordinate the sustainability efforts in our company, we appointed an environmental and responsibility manager and a Sustainability Team, which comprises experts from various fields. The Sustainability Team invents and plans measures for improving sustainability and oversees their implementation.

In the spring, we also started a project for reviewing our current status with sustainability and identifying areas for improvement. Over the course of the project, we interviewed a total of 12 managers and experts in different aspects of sustainability. We also responded to the Dow Jones Sustainability Index survey for finding development needs. This resulted in a Sustainability Roadmap for 2015–2017, which comprises 51 different tasks. The tasks include specification and improvement measures regarding the procedures, risk assessments, purchasing chain, HR development and environmental aspects.

We completed the first tasks, such as the stakeholder review and stakeholder sustainability survey, according to schedule in late 2015. Several other tasks are already underway. We want to be a tyre industry pioneer also in terms of sustainability. Joining the UN's Global Compact initiative on 23 December 2015 is one of the indications of how important sustainability is for our company.

Our Quality and Sustainability policy comprises our promises regarding the environment, health, safety, and quality as well as our plans for keeping those promises.

Commitment to Quality and Sustainability

Our promise

We develop and manufacture high-quality premium products in the tyre industry. Their unique innovations offer users safe, economical and comfortable driving kilometres. We offer our customers the best service in the industry in all fields.
 
As a forerunner in the industry, we are continuously improving the quality, safety and environmental friendliness of our products and processes. In our operations, we take into account the product's entire life cycle.

How we fulfil our promise

One of the starting points of our operations is uncompromising respect for environmental and safety matters, as well as ensuring high quality and a good customer experience.
 
We guarantee the high quality of our products with controlled, efficient and closely monitored development, procurement and manufacturing processes. Our operations are customer-oriented and profitable.
 
We commit to complying with laws and regulations, as well as the requirements of our customers. In our operations, we take into account ethical principles, biodiversity, climate change and sustainable development. We respect different individuals, cultures and opinions.
 
When procuring raw materials and ordering work from external service providers, we only select partners who are assessed to be reliable and in good repute. We do not accept the use of child labour in our own operations or in those of our service providers.
 
Our management is committed to creating work conditions in which individuals have good opportunities to influence the development of and responsibility for environmental and occupational safety and quality. We strive towards efficiency and zero accidents in all operating areas.
 
We familiarise our employees with our basic operating principles and goals and their responsibility for the impacts of their activities on quality and the environment. Furthermore, employees are encouraged to promote quality, occupational and chemical safety, and environmental protection in their activities.
 
Our management sets goals pertaining to finances, the environment, health, safety and quality, monitors their implementation and reserves sufficient resources to meet and maintain these goals.
 
We conduct regular internal audits, assessing the compliance with customer and legislative requirements, regulations and instructions, as well as the efficiency of our operational system.

Our operations are based on these international criteria

Our operations are based on and fulfil the requirements of standards ISO 9001:2008, ISO/TS 16949:2009, ISO 14001:2004, OHSAS 18001 and ISO 17025, as well as those of customers and authorities. In addition we are committed to UN Global Compact principles.

Ari Lehtoranta
CEO

 

Organisation

Environmental aspects, chemical safety and sustainability are assigned to Quality and Process Development, and our Vice President, Quality and Process Development coordinates their management globally. The goals of quality and sustainability management are accident prevention, uninterrupted production, ensuring high quality and good corporate citizenship in all areas of operation.

Management systems

We aim at managing the environmental impacts of our products over their entire lifecycle and addressing the safety and quality aspects of our operations in a comprehensive and systematic manner. The activity management system that encompasses the environmental, safety, and quality issues serves as a key tool for this purpose. The operations manual complies with the ISO 14001 standard in terms of environmental matters and with the ISO 9001 standard as regards quality. Our factory in Russia and the Swedish sales company Nokian Däck are also covered by the joint EHS and quality (EHSQ) system and included in the ISO 14001 and ISO 9001 certifications. The management system, furthermore, covers the safety management system that is referred to in the Finnish Government Decree 855/2012 (industrial handling and storage of dangerous chemicals, SEVESO II). In 2013, we received the automotive industry’s ISO/TS 16949 approval for all of our production plants.

The Nokian Tyres’ environmental and quality targets are specified in the company’s quality and process development strategy, which is drawn up for a period of five years and updated annually. Vice President of Quality and Process Development participates in drawing up the strategy, along with the environmental and responsibility manager, who reports to the Vice President. Working together with environmental experts, the environmental and responsibility manager prepares an annual environmental programme for the factories, which specifies detailed targets, measures, schedules and leading persons for the objectives presented in the strategy. This leadership covers all aspects of the environmental management system. Additionally, each unit has its own projects for developing the operations and processes.

We review the development of environmental and quality matters each month during the management meetings. The senior management provides direct feedback.

Authorities and permits

Nokian Tyres’ environmental and safety operations are supervised by several authorities, with the most important in Nokia being the Pirkanmaa Centre for Economic Development, Transport, and the Environment (ELY), the Finnish Safety and Chemicals Agency (TUKES), the environmental protection and construction supervision units and other offices of the Town of Nokia, and the Tampere Regional Emergency Service. The most important authorities supervising the Vsevolozhsk factory’s operations are the Ministry of Natural Resources and the Environment of the Russian Federation, the Committee on Natural Resources, Environmental Protection, and Ecological Safety of the Leningrad Region, and the Federal Service for Supervision of Consumer Rights Protection and Human Well-Being. The operations of other Nokian Tyres’ units are supervised by the national authorities. We maintain continuous dialogue with various authorities in order to take any official requirements and requests into account in a timely manner. We immediately communicate any disruptions, accidents, or deviations from the terms and conditions of our permits to the authorities.

We see official permits as the minimum requirements and regard eco-friendliness as much more than simply complying with the permit limits. We are committed to being a part of genuinely sustainable development. We actively follow the trends in environmental and safety regulations in Finland, the EU, and Russia, and anticipate the effects of pending regulation on our operations.

The Nokia unit has a valid environmental permit that was granted by the Regional State Administrative Agency for Western and Inland Finland in 2007, and the reviewed permit decision was issued in November 2014. In addition to the chemicals permits from TUKES, the Nokia unit has been granted permission by the Water Court to take cooling water from the river Nokianvirta. We obtained the numerous permits required for the Russian factory already during its construction and have since maintained them in compliance with the local legislation. 

Chemical control operations

The chemical control operations of Nokian Tyres were started in the early 1960s. Our company complies with all the requirements of the EU chemicals legislation aimed at ensuring the safest possible use of chemicals for the employees, environment, and end users. To improve the level of chemical safety and to comply with the REACH directive, we continuously co-operate with component and chemicals suppliers and producers.

In our production, we never use carcinogenic chemicals or SVHC chemicals (Substances of Very High Concern) as per the EU's REACH regulation. Our contract manufacturers do not use any SVHC chemicals. All of our products fulfil the PAH related requirements set in the EU REACH directive. We also aim at ensuring that no goods sold at this time or in the future through the Vianor units include any such chemicals. We require all chemicals suppliers to provide a material safety data sheet (MSDS) in compliance with the valid legislation prior to the procurement of chemicals. The MSDSs of the chemicals in use are registered in a database that is made available to our personnel.

Nokian Tyres produces and sells adhesives and paints in Finland that are used by the rubber industry and it imports specific raw materials that are used in rubber compounds. Our company creates MSDSs for these chemicals and submits them to TUKES for verification and registration.

We test new raw materials that are to be used in rubber compounds for quality assurance and suitability in production under laboratory and production conditions in Nokia. We document the raw materials approved for rubber compounds in a list of approved raw materials. Our procurement staff are only allowed to purchase raw materials that are included in this list of approved materials. The raw materials used by the Russian plant are also tested and approved in Finland.

No booster chemical is taken into use at the Nokia plant before the chemical control team has issued a department-specific usage permit for the substance in question. The team includes the Environmental and Responsibility Manager, an environmental engineer, a chemist from the R&D laboratory, and an occupational physician. The purpose of this policy is to streamline the use of chemicals throughout the company and, whenever possible, to replace hazardous chemicals with safer ones. Each year, a chemical survey is carried out at our factory in Russia.

In 2015, our factory in Nokia introduced a new chemical information system, which stores the material safety data sheets for all the chemicals that are used at the factory. In the future, the system will be suited for chemical risk assessments. We have also started entering the data concerning the chemicals that are used at the Vsevolozhsk factory.

The persons involved in the early stages of production receive annual chemical safety training, which can be arranged to other personnel as needed. Finnish chemicals legislation has undergone significant changes in the past few years. As a result, in 2015, we arranged chemical safety training for all production personnel of the Nokian Heavy Tyres unit as well as the employees in retreading materials production. In 2016, we also aim to arrange the training for the Passenger Car Tyres unit employees and supervisors.

Audits

Regular audits are an important part of our environmental, safety, and quality operations. Their purpose is to guarantee eco-friendliness in production and ensure a safe working environment according to high standards. The audits aim to verify if the operation under scrutiny complies with the legislation, EHSQ policy, and the instructions provided in our activity management system.

We carry out internal environmental and quality audits according to an annual plan. This ensures that each area of activity that is specified in our activity management system is audited at least once every three years. The annual plans are drawn up on the basis of a five-year schedule, taking into account the findings of the previous audits.

An internal safety audit includes an environmental audit and an occupational safety audit. The safety audit looks into machine guarding, fire safety, cleanliness and order, proper handling and storage of chemicals, occupational hygiene, working conditions, and waste management. The audit team also monitors the development of the departments’ safety index. The audits that are carried out are reported to the management, enabling the planning of any new development measures that we deem necessary.

Audits carried out by customers and co-operation partners, such as the automotive industry, are also considered internal audits. The internal audits, furthermore, include the audit that is carried out in conjunction with the weekly management review.

An external auditor performs an audit once a year for assessing compliance with the relevant standards. We supervise legal and regulatory compliance annually or as required by the authorities and insurance companies.

We want to be an industry leader

We want to be an international industry-leader in EHSQ matters. The principle of “A safe company means safe tyres” is an essential part of our company’s identity and reputation. Corporate social responsibility is an integral part of the Finnish business culture, and we are not willing to compromise in this respect in our global operations. The awards and excellent reviews that our company and products have received demonstrate that environmental issues, quality, and safety are important for our customers and other interest groups. Therefore, our successful development projects guide the development throughout the industry.

We are a member of FiBS (Finnish Business & Society ry), a non-profit corporate responsibility network. The network’s mission is to promote financially, socially and ecologically sustainable business in Finland.

In December 2015, we joined the UN Global Compact initiative, which is a significant milestone in our sustainability efforts. By signing the initiative, our group is even further committed to conducting profitable business in a sustainable way.

Taking care of biodiversity

In 2014, we participated in the Business & Biodiversity pilot programme organised by Corporate Responsibility Network FIBS, whose aim was to provide Finnish companies with information and support on comprehensively taking biodiversity into account. The programme included different training sessions and workshops which were mainly led by experts from the Finnish Environment Institute. In addition, the participating companies' representatives shared their best practices and offered peer support.

We have always considered biodiversity to be a part of our environmental aspects, even if we have not listed it specifically. The training programme confirmed our vision of the direction in which we are taking our company. Although our operations have little direct effect on biodiversity, we strive to take these aspects into account even better in what we do.  We started reviewing biodiversity in our location in Nokia, which we then expanded to our facilities in Russia and our test track in Ivalo. In the future, we aim to introduce the review process also in the Vianor outlets and our test track in Nokia. Carrying out a thorough review throughout the group will make it easier to consider biodiversity also on a strategic level. According to the current assessment, Nokian Tyres has no direct impact on biodiversity.

The images marked with grey present the ecosystem services that we are utilising. Natural rubber and other raw materials are necessary for our operations, we utilise different forms of energy in our production, we use cooling water in our process and we need built-up land for our factories and test tracks.

The middle section with orange describes the most significant environmental impacts of our production, which we strive to minimise. It also describes the ecosystem services that we especially want to maintain.

The bottom row describes the potential effects of our production on the biodiversity of the close environment. The images represent the endangered species that live near our production facilities in Nokia: The asp and freshwater pearl mussel live in the lower reaches of the Nokianvirta river, and the red-throated loon nests near our Nokia test track. Our test track in Ivalo, Finnish Lapland, is located in the reindeer herding area. We strive to minimise our impact on the habitat of these species. We want to do our part in maintaining the full diversity of nature for future generations.

 

This page is included in KPMG’s assurance scope. Assurance report can be found here.