Sustainability is a natural part of our business: it means sustainable product development, safe and eco-friendly products as well as high standards of quality in everything that we do. We ensure that our activities do not harm the environment or people. Our tires are easy on the environment and, even under difficult conditions, they will help you reach your destination.
Our business must be profitable so that we are able to offer security, work and well-being for our personnel, while also considering investors, customers, and other stakeholders.
Sustainability is guided by the Group strategy and values.
Our company culture, the Hakkapeliitta Spirit, comprises our values, goals, leadership, and everyday work. At the core of the Hakkapeliitta Spirit are our values, which drive our success by winning together, enable our business to grow profitably and guide our day-to-day operations. Our values guide us in managing sustainability:
CARE: We respect and take care of each other, our consumers, customers, partners and the globe.
DRIVE INNOVATION: We are proud of our heritage and have courage to break new ground.
SUCCEED: We team up to continuously improve and succeed together.
SUSTAINABILITY GOALS GUIDE OUR OPERATIONS
Our everyday improvement of sustainability is guided by the Group’s sustainability goals and the road map plan that we update yearly. The target time for the current road map projects and the Group’s sustainability goals is 2025.
The company’s sustainability activities are led by SVP, Supply Operations, who is a member of the Group’s Management Team. The Group’s Sustainability Steering Group supervises and monitors the sustainability work within the Group and comprises of senior representatives from Supply Chain, Products & Innovations, Finance, Human Resources and Communications. The Group’s Greenhouse Gas (GHG) Steering Group supervises and monitors the progress in reducing greenhouse gas emissions within the Group.
All supervisors’ duties include day-to-day leadership of sustainability. Ambitions, targets, and other key topics are discussed by the Management Team and at least once a year by the Board of Directors. The Board receives updates on OHS on a quarterly basis.
Corporate Sustainability working group comprises finance, purchasing, communication, environment, quality, consumer, customer service, and HR experts. The working group’s main task is to design and promote measures for improving sustainability. Each unit’s management team is responsible for implementing the measures according to their unit strategy.
The Safety Management group, which comprises safety experts and management representatives, works on and tracks the safety aspects.
Sustainable Purchasing working group develops and guides the supply chain sustainability.
The Energy Efficiency working group promotes the means for improving energy efficiency throughout the group.
Product Development creates safer and eco-friendlier products by reducing rolling resistance, for example.
Safety and health are an integrated part of department and team meeting practices. Globally safety and health related KPI’s and actions are followed by the Global Safety team and HR.
Environmental representatives and other local working groups focus on improving the everyday sustainability work. Each Nokian Tyres’ employee is responsible for working and acting ethically.
HR, Communication, and the Risk Management support the work for improving the safety culture and implementing changes in the group.
Environmental management is guided by the following policies: The Environmental, Safety, and Quality Policy guides environmental aspects in our Group. The policy has been approved by the President & CEO. The environmental aspects are also discussed in our Code of Conduct.
Our activity management system is based on the ISO 9001, IATF 16949, ISO 14001, ISO 45001, and ISO 17025 standards and meets the applicable regulations and customer demands. We are also committed to following the UN Global Compact principles.
Our goal is to manage the environmental impacts of our products over their entire life cycle and address the safety and quality aspects of our operations in a comprehensive and systematic manner. The activity management system that covers the environmental aspects, safety, and quality serves as a key tool for this purpose. Our operations manual is ISO 14001 compliant in terms of the environmental aspects and ISO 9001 compliant as regards quality. The key document that guides our environmental protection efforts is the Environmental Protection procedure.
Our environmental targets are specified in the company’s sustainability strategy, which is drawn up for a period of five years and updated annually. Vice President, Quality & Sustainability is involved in drawing up the strategy along with the Environmental and Responsibility Manager, who reports to the Vice President. Working together with environmental experts from different locations, the Environmental and Responsibility Manager prepares an annual environmental program for the factories. The program specifies the detailed targets, actions, schedules and responsible persons for the goals presented in the strategy. In addition, individual units have their own projects for developing the operations and processes.
The development of environmental aspects is reviewed monthly at the management meetings. The senior management provides direct feedback to the responsible persons, as needed.
Our Group’s sustainability efforts are coordinated by the Environmental and Responsibility Manager. Environmental and chemical safety and sustainability aspects belong to the Quality and Sustainability unit, and the overall efforts are coordinated globally by Vice President, Quality & Sustainability, together with Senior Vice President Supply Operations.
The goals of quality and sustainability management are accident prevention, uninterrupted production, ensuring high quality and good corporate citizenship in all areas of operation.
Environmental experts in Finland and the US take care of practical environmental coordination and training, for instance regarding chemicals, emissions, and waste.
COMPLAINT MECHANICS IN ENVIRONMENTAL RESPONSIBILITY
We document the annual environmental impacts of our tire factories and report them to the local authorities as required in each country. We record feedback to the company's own register, KETO, and take the necessary corrective actions.
Our factories’ environmental experts in Finland and the US are responsible for these records. The purpose of this practice is to collect the feedback on the status of our environmental aspects and consider our stakeholders’ related requests and opinions.
We have taken a two-tiered approach to the management of environmental complaint procedures. If the complaint is minor in the scope of Nokian Tyres’ production, an environmental expert can handle it independently and/ or the manager decides on the necessary course of action.
In case of a larger event, the decision to escalate the matter is taken in Nokia, Finland by Vice President, Quality & Sustainability and in Dayton, US, the Plant Manager, and then, if necessary, by the line management.
In its decision-making and administration, Nokian Tyres adheres to the Finnish Limited Liability Companies Act, the Finnish Securities Markets Act and the rules issued by Nasdaq Helsinki Ltd, Nokian Tyres’ Articles of Association, and the Finnish Corporate Governance Code 2020 for listed companies. Nokian Tyres complies with the code without exceptions. The code is published here.
The Company’s governance is described in Nokian Tyres’ Corporate Governance Statement. The Board of Directors as a whole is responsible for decision-making on and overseeing the management of Nokian Tyres’ impacts on the economy, environment and people.
Elected members of the Nokian Tyres’ Board of Directors must be qualified for the task, with competencies relevant to the Company’s business. Nokian Tyres’ Board of Directors is composed of professionals with expertise from fields and geographical areas highly relevant to Nokian Tyres’ operations. Said expertise include, among others, tire industry, finance, risk management, DACH business area, North America business area, the Nordics business area, as well as engineering, managing stakeholder relations, and leading global companies with diverse personnel.
The members of the Board of Directors are elected by the Annual General Meeting upon the proposal by the Shareholders’ Nomination Board.
The Board of Directors conducts an annual evaluation of its activities assisted by an external facilitator. This evaluation is shared with the Board and also with the Shareholders’ Nomination Board, to be used in its consideration of Board candidates.
As per IAS24 Standard of the IFRS, the information on possible conflicts of interest of the Board members is collected annually. If conflict of interest appears, it is reported in the Financial Statement. In 2021, there were no conflicts of interest.
The Corporate Governance Statement has been prepared pursuant to the Finnish Corporate Governance Code 2020 for listed companies and the Securities Markets Act (Chapter 7, Section 7) and it is issued separately from the Board of Directors’ report. The Board of Directors has reviewed the Corporate Governance Statement, and the auditor KPMG as verified that the Statement has been issued and that the description of the main features of the internal control and risk management systems relating to the financial reporting process is consistent with the financial statements.
At Nokian Tyres, our need to develop leadership processes and practices always arises from a business perspective, and their implementation is based on our strategy and organizational culture. Our aim is to establish consistent and truly global HR operations that are based on efficient decision-making and project management as well as open interaction and information sharing. These elements help us implement fair, transparent, clear, and need-based People management in our different units and locations. Good People management enables us to ensure that energized and competent people are committed to the company’s goals and, in turn, to its successful business.
HANDLING ISSUES AND COMPLAINTS IN HR
We handle any issues and complaints locally within our company. Our aim is to maintain a leadership culture that makes it very easy to raise concerns. The primary channel for raising issues goes from managers and experts up to the top management, as necessary. Any questions and observations are handled as appropriate in accordance with the law and our company’s guidelines. All reports are investigated, and each case is handled based on the results of the investigation.
As part of our Code of Conduct, we have issued a reporting procedure that instructs all of our employees to report any identified or suspected internal or external misuse or violation. It also describes the communication channels established for this purpose. The purpose of the instructions is to encourage our personnel to report any potential violations of ethical guidelines and laws that they encounter, so that we can investigate and handle each case.
It is also possible to make an anonymous report through the Whistleblow channel. The same channel is available to external stakeholders by email at firstname.lastname@example.org.
We also employ protocols, e.g. for bullying and harassment. There are subject-specific instructions that specify who to contact and how to deal with the situation with the appropriate sensitivity. We encourage everyone to make safety observations that they can direct to whoever they want inside the organization. After the root cause is identified, the matter is communicated to the relevant person. The entire process is documented in order to ensure it follows the protocol.
MANAGEMENT OF PRODUCT ADVANCEMENTS, PRODUCT SAFETY, AND PRODUCT LIABILITY
The management of product advancements, product safety and product liability is guided by the following principles, operating models and policies:
- Our leadership and product development are guided by our Code of Conduct, the Environmental, Safety, and Quality Policy, and testing policies. We also comply with several requirements concerning noise, studs, chemicals, testing, and tire markings, among other things.
- The basic principles of quality in our supply chain follow best practices based on the UNECE and EU regulations, efficiency, and functionality of the processes, safety and consistency of products as well as delivery reliability.
- Our research and development functions comply with the legislation that guides our industry, regulations and instructions by the authorities and the principles described in our ethical guidelines. Our activities are supervised by the authorities in various countries. Everything that we do is guided by the legal and regulatory requirements whose primary purpose is to ensure the safety and environmental aspects from production to the use of final products.
- Our activities are directed by work instructions and operating models, which apply to processes and work stages as well as individual tasks. Individual employees, supervisors, unit managers and top management are all responsible for our activities.
- Product responsibility is connected to unit-specific and personal performance targets. Unit-specific targets are tracked in real time, whereas personal targets are discussed annually during People Reviews.
PROCEDURE IN CASE OF A FAULT
We employ a quality management system for tracking our products over their entire life cycle and ensuring that all of the tire lots that are cleared for sale comply with the applicable decrees and regulations. We systematically track product quality and our quality assurance results and swiftly take the necessary measures for ensuring safety.
Our Group has not had any major product recalls in more than 20 years. Furthermore, Nokian Tyres has not been involved in any legal proceedings regarding product liability.
The essential instructions apply to handling customer complaints, limitation of sale, and recalling a sales batch. We have the capability to recall the products from the wholesale and retail level or, in addition, from end consumers and to immediately report all such events to the authorities in the countries where the affected tires are being sold. Our instructions also cover country-specific guidelines, such as the reporting required by the NHTSA in the United States.
All Group personnel are instructed to report any quality deviations that they become aware of. We follow the EU product safety database that records all of the recall events in the industry. The data helps us anticipate the likelihood of similar risks in our own processes.