SSAB Sustainability strategy 2020
A stronger,lighter and moresustainable world
Together with our customers,we will go further than anyoneelse in realizing the full potentialof lighter, stronger and moredurable steel production
Steel is part of the solution
► Critical for society and new infrastructure
► Unique material and available everywhere
► 100% recyclable withoutloss of quality
COMMUNICATION ENERGY
TRANSPORTINFRASTRUCTURE
Steel consumption has doubled over the last 20 years
► Increased standard of living
► Urbanization and infrastructure
► Transportation and production
Source: worldsteel Short Range Outlook March 2018
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World World excl China China
Steel consumptionMtonne
Steel is the most circular material in the world
050
100150200250300350400450500550600650
Mass of materials recycled globally
Mill
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met
ric
ton
nes
► More steel is recycled than all other materials combined
− 100% recyclable indefinitely
− Without loss of quality
− Recycling rate above 85% worldwide
► Steel is used everywhere
− Steel is critical when building society and infrastructure
Recycling will not be enough– 50% iron ore-based steel will still be needed by 2050
20502016
2800 Mtonnes steel1600 Mtonnes steel
Recycledmetal
Iron ore Recycledmetal
Iron ore
New sustainability strategy With the Future in Mind
New sustainability strategy With the Future in Mind
SSAB to become fossil free 2 clear objectives
SSAB to introduce fossil-free steel in the market in 2026
− Launch of a premium product without fossil CO2 footprint
− This means no fossil CO2 emissions when producing this product, and a requirement to use fossil-free sponge iron
1
2SSAB to have leading sustainability performance; fossil free by 2045
− To be fossil free within the entire operation by 2045, by stepwise reducing CO2 footprint
− This means net zero CO2 emissions from our own operations and purchased energy
First in fossil-free steel
► Use better steel
− Reduce your footprint with low CO2 steel
► Use steel better
− SSAB steel makes products lighter and stronger
− Reduce CO2 emissions in the use phase
► Go fossil free
− Be part of a fossil-free value chain
− Be the first to offer fossil-free products
SSAB’s blast furnace-based production is among the most CO2 efficient in the world. This gives a competitive advantage to SSAB and our customers.
Compared to Chinese steel mills, SSAB steel saves on average
1 600 000 tonnes of CO2 every year
This means that a German customer would generate
21% higher CO2 emissions, including transportation, when using steel from an average Chinese steel mill
+
Use better steelReduce your footprint with low CO2 steel
Source: thinkstep, BF GWP benchmarking, 2019, and SSAB EPD data
100 100106
101
126
113117 115
126 127
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Cold rolled Hot rolled
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ind
exed
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P:
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elp
rod
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► Environmental Product Declarations validate sustainable production
− SSAB issued new EPDs 2020
− Supporting Life Cycle Analyses
► EcoSmart communicates sustainability
− Emphasizing both key product and process attributes to steel
− Steel made from 97% recycled materials
► Innovative technology, e. g.GreenCoat Bio-based coatings
− A unique, patented sustainable building product
− Using Bio-based Technology (BT) coating made with rapeseed oil
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Use better steelReduce your footprint with low CO2 steel
Use steel betterSSAB steel makes products stronger, lighter and increases productivity
High-strength steels make the world’s highest skylift possible
High-strength steels move the roof of Friends’ Arena
High-strength steels save 30 tonnes of CO2 for Mantella
A 112-meter-high skylift needs be strong and lightweight. In the top section, Bronto uses steel just 3 mm thick, making it light enough to be put on a regular truck.
The opening roof of the Swedish national arena needs to be light and strong. With high-strength steels the weight was reduced by 21% and CO2 emissions cut by 900 tonnes.
High-strength steels made this trailer shed over half a tonne of weight. The increased productivity saves 12,000 liters of fuel and 30 tonnes of CO2 during 12 years of operation.
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Use steel betterReduce CO2 emissions in the use phase
► High-strengths steels give customer CO2 savings
− Steel is used in equipment with significant fuel consumption
− SSAB steels make products lighter and more productive
− The SSAB EcoUpgraded concept quantifies CO2 and financial savings
► High-strength steels are key in reducing vehicle weight and energy consumption
− Without compromising safety
► In emission-free vehicles materials have the largest environmental impact
− High-strength steels have lower environmentalfootprint than magnesium, carbon fiber or aluminum
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LKAB will reduce energy consumption and CO2
emissions to reach a positive CO2 balance by 2045
Vattenfall's goal is that both the company and its customers will be completely fossil-free within one generation
SSAB will reduce CO2 emissions by closing blast furnaces and use HYBRIT technology, becoming a fossil-free company by 2045
Fossil-free steel
SSAB customers using fossil-free steel, aiming for carbon-neutrality, starting 2026
+ + =Fossil-free mining Fossil-free electricity Fossil-free value chain
+
Go fossil freeBe the first to offer fossil-free products
Hybrit – Fossil-free steelmaking
2016-2017 Pre-feasibility Study 2018-2024 Feasibility Study Pilot plant trials 2025-2035 Demonstration Plant Trials
BLAST FURNACE DIRECT REDUCTION
HYBRIT would eliminate ~90% of SSAB’s total CO2 emissions
Go fossil freeBe the first to offer fossil-free products
►We aim to have fossil-free steel products on the market in 2026
− Using HYBRIT technology
− With selected customer partnerships
2026
Pilot phase
Demo phase
Initiate partnerships
Oxelösund electric arc furnace
Order books open
202520242023202220212020TIMELINE
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Better and fossil-free steel
Target KPI Target 2020-21
Target 2022
Target 2026
Target 2030 Target 2040 Target 2045
Lower energy consumption/Higher productivity for customers
Mtonnes customer CO2 savings 1)
10
First in fossil-free steel
Fossil-free steel milestones Pilot plant to open
Iowa operations in USpowered 100%by renewable energy
Fossil-freesteel to customers 2026 -Delivered on commercial terms
Raahe conversion starting
Luleåconversion starting
SSAB fossil-free
1) The 2020 target has been moved to 2021 due to the Corona crisis New target from 2022 onwards will be set during 2021.
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Leading sustainabilityperformance
► Safety first
− The world’s safest steel company
− We care for each other
► Efficiency & Responsibility
− Resource efficient operations
− Responsible sourcing
► Respect & integrity
− Zero tolerance for bribery and corruption
− We are diverse and inclusive
Safety firstBecoming the world’s safest steel company
FOUR BUILDING BLOCKS OF SAFETY
Safety culture and leadership
Occupational safety management
Occupational health management
Process safety management
Safety firstBecoming the world’s safest steel company
► Focus on preventative work
− Learn from each other and share best practices
− Required training for all
− Risk identification, assessment, evaluation and removal processes
► Never walk by
− Personal responsibility to work in a safe manner every day
− Managers lead by example
− All work is performed safely or otherwise discontinued
► World class process safety
− Find out what can go wrong
− Find out what protects us from anything going wrong
− Ensure measures are effective, implemented and working properly
Zero accidents, work-related injuries or illnesses
Safety firstBecoming the world’s safest steel company
Targets KPI 2019 Target 2020
Target 2021
Target 2023 Target 2025
Eliminate fatalities and serious incidents
Number of fatalities (incl. contractors) 0 0 0 0 0
Number of serious incidents 226 204 188 144 115
Reduce injuries and their severity
LTIF 4.2 4.0 3.4 2.0 <1.5
TRIF 12.4 11.9 9.2 6.2 <5.0
LTI severity rate (the number of absence days as R12 months cumulative).
37 16 14 10
Eliminate major process safety incidents
Number of major process safety incidents
149 118 22 20 18
Safety leadership Number of safety rounds 45 800 50 500 52 800 59 900 68 600
Number of risk observations 22 800 24 400 25 900 30 100 35 300
Number of near misses prevented 11 400 12 400 12 800 15 000 17 400
Efficiency & ResponsibilityCircularity
► Internal recirculation
− Materials are recycled back into the steelmaking process, which reduces the need for virgin raw materials
− Landfill waste minimization
► Utilizing by-products
− Steel production gives rise to a range of by-products, which can be sold to or used by other industries
► Energy recovery
− Used for district heating on all major sites
Our materials are used in:
• Iron- and steelmaking
• Road construction
• Cement industry
• Car batteries
• Freezer door closing systems
• Cars (permanent magnets)
• Water purification chemicals
• Insulations
• Car tires
• Farmland
• Building bricks
• Papermaking
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Efficiency & ResponsibilityMinimizing environmental impact
► Efficient use of raw materials and energy
− Improving energy efficiency to reducethe amount of energy needed
− Optimizing logistics and improved fuel economy, driving routes, load carrier capacity
► Air emissions reductions (other than CO2)
− Nitrogen oxides, sulphur oxides, particulate matter, etc.
► Water effluents
− Preventing the risk of contaminating water resources and reducing effluent discharge
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► Greenhouse gas emissions (CO2e)
− SSAB commits to reducing absolute Scope 1&2 emissions 35% by 2032 from a 2018 base-year
− Science Based Target initiative (SBTi) approved CO2 reduction target for target year 2032
Scope 1&2 CO2e emissions 2022 2025 2026 2030 2031 2032
CO2e reduction million tonnes -0.5 -1.2 -1.8 -3.1 -4.0 -4.1
SBTi Target – reduction in % 4% 10% 15% 26% 34% 35%
Iowa operations in USpowered 100%by renewable energy
50% use of EAFin Oxelösund
100% use of EAFin Oxelösund
25% use of EAFin Raahe
50% use of EAFin Raahe
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Efficiency & ResponsibilityResource efficient operation
► Circularity (In the Nordic production system)
− Use of scrap/H-DRI (home scrap, purchased scrap and H-DRI replacing BF route iron ore pellets)
− Slag utilization (BF, BOF and EAF slag)
► Minimizing environmental impact
− In addition to the material environmental aspects addressed in the SSAB Group target setting, a wider range of aspects are addressed at the division and site levels
Targets 2025 2026 2030 2031 2032
Use of scrap/H-DRI 29% 39% 46% 54% 54%
Slag utilization 100% 100% 105% 107% 107%
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Efficiency & ResponsibilityResource efficient operation
To ensure that we collaborate with suppliers who share the sustainability values described in SSAB´s Supplier Sustainability Policy
► Follow-up & corrective actions
- On site visits and third party audits as outlined in the annual sustainability audit plan
- Follow up on KPI:s
► Supplier onboarding
- Contracts and purchase orders refer to the Supplier Sustainability Policy
► Risk assessment
- Commodity managers trained in responsible sourcing
- Assessments based on risk indices for human rights, political and environmental risks
- Identified suppliers complete self-assessment questionnaire on their commitment to labor and human rights, health and safety, anti-corruption and the environment
Efficiency & ResponsibilityResponsible sourcing
Targets KPI Target 2020
Target 2021
Target 2025
Target 2030
Target 2045
Sustainable supplier base Share of new suppliers sustainability assessed (GRI 414-1)
100 % 100 % 100 % 100 % 100 %
Share of total spend sustainability assessed (categorized/identified and self-assesment done)
93 % 96 % 98 % 100 % 100 %
Number of second (third) party sustainability audits and on-site visits including social and environmental performance of suppliers 1)
27 37 -- -- --
Share of high-risk raw material suppliers sustainability audited 2)
90 % 100 % 100 %
Reduced CO2e footprint from the supply chain
Reduced Scope 3 CO2e emissions from the supplychain
Targets to be defined
1) Previously reported separately. Target 2021 is 7 second (third) party audits and 30 on-site visits
2) Based on Verisk Maplecroft´s risk indices for human rights, political and environmental risks and Transparency International´s Corruption Perceptions index
Efficiency & ResponsibilityResponsible sourcing
Respect & IntegrityZero tolerance for bribery and corruption
The Code of Conduct is the way we act. It forms the basis for our ethical, environmental and social responsibility
Tone from the top is clearly communicated. All employees must take an e-learning in business ethics
Code of conduct Anti-corruption Ethics Line
Global whistleblower (Ethics Line) available online or by calling a global hotline, open 24/7
Allowing employees to raise concerns anonymously
SSAB has zero tolerance for bribery and corruption
Clear instructions guide us in our daily operations and how we act in relation to business partners
Respect & IntegrityZero tolerance for bribery and corruption
Targets KPI Actual 2019
Target 2020
Target 2021
Target 2025
Target 2030
Target 2045
Ensure ethical conduct in line with SSAB´s corporate culture and increase knowledge about the Code of Conduct and Ethics Line
All employees have completed the e-learning in business ethics; including training on our Code of Conduct
91% 92% 95% 100%* 100 %* 100%*
Share of new employees covered by the onboarding process; including signing the Code of Conduct statement and e-learning in business ethics
72% 75% 80% 100%* 100%* 100%*
Share of employees who have access to the Ethics Line* *
95% 95% 95% 95% 95% 95%
*Because of employee turnover, 100 % may in practice never be reached**Employees that do not have access to the Ethics Line have other local reporting channels
Respect & IntegrityWe are inclusive and diverse
We strive for inclusion to ensure the full and equal participation of everyone across the full spectrum of diversity within the organization.
At SSAB, we expect our leaders to continuously strive to create an inclusive workplace and build a diverse workforce – for the good of our culture, increased engagement and to drive our overall performance and results as a high-performing organization.
For us, a diverse workforce provides a wide range of abilities, competences and experience. Diversity means heterogeneity of our workforce including age, gender, race, ethnicity, physical abilities, political and religious beliefs, and other attributes.
Respect & IntegrityWe are inclusive and diverse
Workforce
Develop an inclusive and innovative workplace
Attract, hire and promote a diverse workforce for the future
Focus areas- Equal career opportunities - Hiring practices with broader
outreach for searching candidates
- Transparent internal recruiting processes
Be a responsible partner and enhance our reputation as a company and employer
Focus areas- Partnerships with key schools- Employer branding- Relevant Inclusion & Diversity
initiatives locally
Focus areas - Working with SSAB One to create
involvement and engagement- Trainings on inclusion, diversity
and non-discrimination- Mentoring programs and
networks
Workplace Community
Respect & IntegrityWe are inclusive and diverse
Target KPI Target 2020 Target 2022 Target 2025 Target 2030 Target 2045
Diversity & Inclusion Women in top management positions, % 32 35 37
Materiality analysis 2019Prioritized aspects
4a 5a5b
1
6b 7
2b
4b
8b
Significance to SSAB
Sign
ific
ance
to s
take
ho
lder
sV
ery
Imp
ort
ant
Imp
ort
ant
Important Very important
1a Lower energy consumption/Higher productivity for customers
2b First in fossil-free steel/Eco-labeling
4a GHG emissions (CO2e)
4b Circularity (Residuals/by-products)
5a Occupational Health & Safety
5b Process safety
6b Business ethics
7 Responsible sourcing
8b Diversity and Inclusion
Materiality analysis 2019Prioritized aspects
4a 5a5b
1
6b 7
2b
4b
8b
Significance to SSAB
Sign
ific
ance
to s
take
ho
lder
sV
ery
Imp
ort
ant
Imp
ort
ant
Important Very important
1a Lower energy consumtion/Higher productivity for customers
1b Longer service life for customers’ products
1c Lower weights of customers’ products
1d Less steel used in customers’ products
2a Lifecycle perspective
2b First in fossil-free steel/Eco-labelling
2c Reporting
3a Efficient use of energy
3b Efficient use of raw materials
3c Efficient water management
3d Use of high quality raw materials
4a GHG emissions (CO2e)
4b Circularity (Residuals/by-products)
4c Air emissions
4d Impact on local environment
4e Water effluents
4f Emissions from transportations
4g Biodiversity
5a Occupational Health & Safety
5b Process safety
6a Business ethics
6b Human Rights compliance
6c Whistle blower system
7a Responsible sourcing
7b Pro-active work against corruption in supply chain
7c Health and safety in the supply chain
7d Environment
7e Supplier sustainability audits
7f Supplier screening
8b Diversity & Inclusion
8c Employee engagement
8d Retention and employer attractiveness
8e Strong company culture, leadership practices
9 Strategic approach to community engagement
9b Local engagement in communities
9c Group wide charitable initiatives
9d Philanthropic donations
Bold => in dark blue square => prioritized
Tuesday, February 2, 2021 First Last name36PUBLIC