Managing sustainability

Management accountability

Our Executive Committee is responsible for incorporating the sustainability agenda into the company strategy and monitoring the performance of each business through the Operational Control Cycle. Given our focus on sustainability, overall ownership of sustainability is with the CEO.

The Sustainability Council advises and updates the Executive Committee on new developments, performance and the integration of sustainability into our management processes. The Council, which meets quarterly, consists of representative Business and Functional Directors, as well as the CEO. The Director of Sustainability reports to the Executive Committee on a regular basis.

Monitoring progress

We use key indicators to track our progress in delivering on our sustainable business imperatives and continue to drive continuous value improvement processes in every function, supported by external benchmarks.

During 2019, we continued to include our core principles – including sustainability – in the personal objectives and incentives of employees. This is tailored to each employee’s role in the organization and linked to our sustainability priorities. For employees in operations and supply chain management, objectives are linked to resource productivity. For those in innovation, marketing and sales, they are linked to product portfolios of more sustainable solutions.

Managing sustainability – Monitoring progress (graphic)

Materiality assessment

Sustainability topics material to our company are reviewed based on input from internal and external stakeholders. We focus on topics that have the biggest impact in terms of accelerating our strategy of creating shared value. This approach builds on our core principles of safety, integrity and sustainability including respect for human rights. The materiality assessment is based on key risks and opportunities for the company as they relate to the acceleration of our business agenda and our approach to sustainability. The key topics identified are validated annually and assessed on their relative importance.

Managing sustainability – Materiality matrix (graphic)

	Topic	Section of the report
A	Employee development	Note 7: Employees
B	Integrity	Compliance and integrity management
C	Human rights	Note 8: Human rights
D	Community involvement	Note 9: AkzoNobel Cares
E	Fair taxes	Financial information Note 8
F	People/process safety	Note 6: Health and safety
G	Circular economy	Planet
H	Supplier sustainability	Note 5: Supplier sustainability
I	Climate strategy	Planet
J	Resource productivity	Note 4: Resource productivity
K	Customer satisfaction	Note 2: Customer value
L	Sustainable solutions	Note 1: Sustainable solutions
M	Product safety	Note 6: Health and safety

Stakeholder engagement

We engage and collaborate proactively with our stakeholders to identify opportunities to create shared value. Our key stakeholders are customers, employees, suppliers and communities (see previous Notes), as well as society, industry associations and investors (see below).

Associations and councils

We continued our memberships in 2019, including our active membership of the World Business Council for Sustainable Development (WBCSD) and the World Green Building Council. We have been a signatory of the UN Global Compact since 2004 and annually disclose our communication of progress. We subscribe to the UN Universal Declaration of Human Rights, the key conventions of the International Labor Organization and the OECD Guidelines for Multinational Enterprises. We are also a signatory to the Responsible Care^® Global Charter and the CEO Water Mandate. Since 2017, we’ve been a member of the RE100 (a Climate Group initiative), which aims to move to 100% renewable energy. As a member of the UN Global Alliance to Eliminate Lead in Paint, we were the first major paint company to eliminate lead pigments and driers in all our paint products and continue to do so when we acquire new companies.

External benchmarks

We continue to set ambitious targets on topics most material to our company and embed them in relevant functions and businesses. This allows us to focus on driving continuous improvement. In 2019, we reviewed which benchmarks are best suited to us as a focused paints and coatings company. We prioritize our active participation in benchmarks that help drive continuous improvement and rely mostly on publicly available information. We continue to be recognized as an industry leader by Sustainalytics, MSCI, Vigeo Eiris and ISS Oekom. We also retained our EcoVadis Gold rating and are included in the Ethibel Sustainability Index (ESI) Excellence Global.

Reporting principles

Our reporting principles are based on the Global Reporting Initiative (GRI) standards, complemented by internally developed guidelines. Our complete reporting principles can be found on our website, along with an index of the GRI indicators.

Society: UN Sustainable Development Goals

Developed by the United Nations, the Sustainable Development Goals (SDGs) are a blueprint for achieving a better and more sustainable future. All the SDGs inspire our actions and decisions. As a company, we continue to focus on those SDGs where we can have the biggest impact and integrate them into our sustainability agenda. This agenda is a key driver for business development, innovation and growth. The SDGs will therefore continue to help us take our industry forward and ensure that sustainability remains firmly at the heart of what we do. Our commitment is also reflected in the case studies included in this Report 2019. They highlight in particular how our products and ongoing innovation contribute to those SDGs where we can have the most positive impact.

Sustainable cities and communities

The majority of our products are used in the buildings and infrastructure sector. Our focus on helping to create green buildings means we can have a major positive impact on cities and communities. This includes improving the energy efficiency of buildings through the use of heat-reflective coatings, as well as providing interior wall paint which can improve the health and well-being of residents. See SDG 11 in action in Going the extra yard.

Responsible consumption and production

We’re fully aware of the huge opportunities that come with applying the principles of the circular economy across our entire value chain (see Planet). We also know it’s a way for us to improve the performance, durability and long-term protection that our products can bring to underlying substrates. Coatings are an enabler to prevent products becoming waste. They enable furniture, transport and building materials to be reused and recycled; they can reflect heat; lower fuel use and friction; and provide insulation. It’s also about solutions being non-hazardous. See SDG 12 in action in New life for old paint.

Partnerships for the goals

Collaboration is essential in order to scale up actions across the SDGs. We believe in the impact innovation can have in bringing the industry forward and ultimately helping us to achieve the aims they set out. This was one of the driving forces behind us setting up our Paint the Future ecosystem, which was launched in 2019 with a global startup challenge, followed by a dedicated supplier event. See SDG 17 in action in Launching new innovations together and New life for old paint.