Fortum strives for balanced management of
economic, social and environmental responsibility in the company’s operations. Fortum's
sustainability targets consist both of Group-level key indicators and
The Group-level sustainability targets
emphasise Fortum's role in society and measure not only environmental and
safety targets, but also Fortum's reputation, customer satisfaction, employee
wellbeing, and the security of production of power and heat. At the beginning
of 2016, the Group-level target-setting was changed by taking work well-being,
measured as a percentage of sickness-related absences, as a new Group target.
In terms of specific carbon dioxide emissions (gCO2/kWh), Fortum
focuses on measuring Group-level specific emissions from total energy
production. 62% of the
total electricity Fortum produced in 2016 was carbon dioxide-free.
The achievement of the sustainability targets
is monitored in monthly, quarterly and annual reporting. Sustainability
target-setting and follow-up, as well as the approval of Fortum's
Sustainability Policy, and the review of Fortum's Sustainability Reporting, are
included in the working order of the Board of Directors. Complete data on
Fortum's sustainability performance is published in Fortum's Sustainability
The company is listed on the Nasdaq Helsinki exchange and is included in the STOXX Global ESG Leaders, OMX GES Sustainability Finland, and ECPI® indices. Fortum is also ranked in category A- and as the top Nordic company in the utilities sector in the annual CDP (formerly the Carbon Disclosure Project) rating 2016, and it has received a Prime Status (B-) rating by the German oekom research AG.
For Fortum, economic responsibility means
competitiveness, performance excellence and market-driven production, which
create long-term value for our stakeholders and enable profitable growth.
Satisfied customers are key to Fortum's success. Fortum aims to manage its supply chain in a responsible manner.
Fortum's goal is to achieve excellent financial
performance in strategically selected core areas through strong competence and
responsible ways of operating. Fortum measures financial performance with
return on capital employed (target: 10%) and capital structure (target:
comparable net debt/EBITDA around 2.5). In addition, Fortum has used the
applicable Global Reporting Initiative (GRI) G4 indicators for reporting
economic responsibility as of 1 January 2014.
Fortum’s aim is to provide its
customers with environmentally benign products and services. Circular economy,
resource and energy efficiency, and maximising the added value of waste and
biomass are key priorities in Fortum's environmental approach. In addition, climate change mitigation, and the reduction of
environmental impacts are emphasised in Fortum's environmental responsibility.
The company's know-how in CO2-free hydro and nuclear power
production and in energy-efficient combined heat and power production,
investments in solar and wind power, as well as solutions for sustainable
cities play a key role in this.
environmental targets are related to CO2 emissions, energy
efficiency, and major environmental, health and safety (EHS) incidents. At the
end of 2016, 99.9% of Fortum's power and heat production worldwide had ISO
target over the next five years is for total specific CO2 emissions
from both electricity and heat production in all countries to be below 200
g/kWh. The target is calculated as a five-year average. At the end of 2016, the
total specific CO2 emissions from energy production were at 188
(191) g/kWh, which is better than the target level.
CO2 emissions in 2016 amounted to 18.6 (19.2) million tonnes (Mt),
of which 2.7 (2.1) Mt were within the EU's emissions trading scheme (ETS). The
estimate for Fortum's free emissions allowances in 2016 is 1.0 Mt.
Fortum's target is to achieve an energy savings of more than 1,400 GWh
annually, compared to 2012. At the end of 2016, about 1,372 GWh had been achieved.
Among the projects executed in 2016 were nuclear plant refurbishments in
Finland, hydropower plant refurbishments in Finland and Sweden, and gas turbine
plant refurbishments in Russia.
was fewer than 23 major EHS incidents annually. In 2016, 22 (18) major EHS
incidents took place in Fortum's operations: the incidents included 11
non-compliances with environmental permits, seven fires, one leak and three
explosions. These incidents did not have significant environmental or financial
responsibility emphasises the secure supply of electricity and heat, creating
solutions for sustainable cities, operational and occupational safety, employee
wellbeing, as well as ethical business operations and compliance with
regulations. At the end of 2016, OHSAS 18001 certification covered 99.9% of
Fortum's power and heat production worldwide.
The average energy
availability of Fortum's CHP plants in 2016 was 97.4% (96.4%), clearly above
the annual target level of 95%.
Sustainability targets affect every Fortum employee
Sustainability targets affect every Fortum employee and are part of
Fortum’s short-term incentive scheme. In addition to the Grouplevel
targets, divisions have their own targets. Fortum’s Board
of Directors annually decides on the sustainability targets to be
included in the incentive scheme. In 2016, the incentive scheme
included the injury frequency for Fortum employees and for
contractors and the number of serious occupational accidents.
The injury frequency for Fortum employees and for contractors
will be included in the 2017 incentive scheme. The weight of the
sustainability target in the incentive scheme is 10% (2016: 10%).
recordable injury frequency (TRIF) for Fortum employees in 2016 was 1.9 (1.6)
per one million working hours, which is better than the Group-level frequency
target (≤ 2.5). Fortum’s target for the lost-workday injury frequency (LWIF)
for own personnel was 1.0 and it was achieved (1.1). The lost-workday injury
frequency for contractors was 3.0 (2.7), which is at the set target level. The
number of serious occupational accidents was 13 (14).
of the agreed actions to improve contractor safety will continue with a
specific focus on contractor safety and the integration of the Ekokem and Duon
operations. As of 1 January 2017, Fortum has changed the definition of the
severity of work-related accidents and is now focusing on the consequences or
potential consequences of an accident rather than the length of the sick-leave.
The Group target for 2017 is ≤ 5 severe accidents. By 2020, our target is to
reduce severe accidents to zero. The percentage of
sickness-related absences in 2016 was 2.3 (2.4), which is below the target level.
Our targets for 2017
Our sustainability targets are based on continuous operational
improvement. In our target-setting for 2017 we have taken into
consideration the potential occupational safety impacts of Fortum’s
growth strategy and business acquisitions. It is likely that, until
Fortum’s occupational safety practices have been integrated in the
new functions, the acquisitions will temporarily weaken Fortum’s
current good level of occupational safety.
There are still too many serious injuries occurring in our
operations. Starting in 2017 the focus of our monitoring is on
accidents that have serious consequences, rather than on the length
of the sick-leave. These include accidents leading to a fatality or
permanent disability and accidents that could have caused serious
A new indicator we will track in 2017 is the quality of the
investigations of occupational accidents, serious EHS incidents,
and near misses. The goal is that the investigation of each incident
is done in accordance with guidelines, and more than 90% of
the corrective actions are implemented on schedule (target level
1.0). By 2020, the goal is for 100% of the corrective actions to be
implemented on schedule, the investigations to use experts from
across division boundaries and the lessons learned from the
incidents to be actively shared (target level 1.5).