Fortum reorganised its corporate structure as of 1 April 2016.
The target of the new organisation is to enable the implementation of the company’s new vision and strategy, which were announced on 3 February 2016. The new organisation consists of three business divisions: Generation, City Solutions and Russia. In addition, two development units focusing on growing new businesses are established: M&A and Solar & Wind Development as well as Technology and New Ventures.
Changes to Fortum's segment reporting are minor at this point and the company will keep four reporting segments. The reporting segments as of the second quarter 2016 are: Generation, City Solutions (mainly the former Heat, Electricity Sales and Solutions) and Russia. M&A and Solar & Wind Development as well as Technology and New Ventures will be reported under Other. Some businesses will be repositioned due to the reorganisation, but because of the minor financial impact at this point, the comparable segment information for 2015 will not be restated.
This division will be responsible for the large scale power production, physical optimisation and trading activities in the Nordic area. The division will comprise nuclear, hydro and thermal power production, portfolio management and trading, industrial intelligence and nuclear services.
This division is responsible for developing sustainable city solutions into a growing business for Fortum. The division will comprise heating and cooling, waste to energy, biomass and other circular economy solutions as well as electricity sales and services. It will include the service business currently organised in the Power Solutions unit with exception of nuclear services.
Russia division will comprise Fortum's power and heat generation and sales activities in Russia.
Technology and New Ventures
In order to speed up innovation and new business development, a new unit, Technology and New Ventures, is established. This unit will be responsible for Fortum's research and development activities and be the in-house incubator for startups. It will also be responsible for direct and indirect investments in external startups as well as cooperation with universities and research institutions. Furthermore, Fortum's Corporate IT will be part of this unit and its role will be developed to a strategic enabler of digitalisation and information technology solutions and applications for the businesses.
M&A and Solar & Wind Development
Fortum strives to create value by driving utility industry consolidation and restructuring through transformational mergers and acquisitions in its current home markets and in the integrating European market. The company also targets a gigawatt-scale solar and wind portfolio. These efforts are centralised under a new unit dedicated to leading group-wide mergers and acquisitions and the development of the solar and wind portfolio.