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Sustainability at Cargotec

Sustainability is an enormous business prospect for Cargotec

Sustainability is an enormous business prospect for Cargotec. The future growth in our business comes from increasing demands for operational efficiency, the proliferation of lifetime solutions and from increasing cargo volumes.

We serve industries that cover the majority of the world's gross domestic product (GDP). This gives us potential to enable increased welfare globally.

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Offering for eco-efficiency
We can promote global eco-efficiency with our offering, as our customers - producing a large share of global GDP and welfare but also global emissions - can limit their emissions with the use of our products.

We have introduced an offering for eco-efficiency. Products within the portfolio can benefit customers’ operational, emissions or resource efficiency. In environmental industries, our products and solutions can enhance the industry efficiency.

Our strategy guides our sustainability work
Services development and digitalisation are at the core of our strategy. As a global forerunner, we can shape the industry by driving higher sustainability standards and promoting the circular economy.

Digitalisation presents optimisation opportunities, which we believe will be vital in increasing eco-efficiency. In our expanding service business, the new business models have been built according to the principles of the circular economy.

Corporate sustainability governance
Sustainability is on the Board of Director’s agenda at Cargotec, and the Board reviews sustainability on an annual basis. The Extended Executive Board conducts bi-annual sustainability reviews and approves corporate level sustainability targets. Cargotec’s Senior Vice President, Communications is responsible for sustainability issues within the Extended Executive Board.

Business area sustainability governance
To ensure that targets match business area operations, the management teams of Kalmar, Hiab and MacGregor hold a sustainability review at least bi-annually for their respective business areas, reviewing and approving possible adjustment needs of the corporate level sustainability targets.

Operational sustainability management
Operationally, sustainability is managed both at a corporate and a business area level over organisational boundaries. Key responsible organisations are units working with strategy, quality, R&D, sourcing, EHS (environment, health and safety), corporate audit, HR and legal issues.The corporate level sustainability targets are proposed, reported on and monitored by Cargotec’s Corporate Sustainability function, and each business area has its own function responsible for coordinating its sustainability work.

In 2017, Cargotec mandates Cargotec Sustainability Council to align and agree actions taken on corporate and business area level related to development, implementation and follow-up of sustainability targets and policies. The Sustainability Council consists of Corporate Sustainability function (SVP Communications and Director CR), as well as corporate strategy and business area management team members responsible on sustainability issues.

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Port 2060

The new Port 2060 vision is a result of open collaboration and creativity.

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Our sustainability work and targets support our strategy. They are set to ensure the standard sustainability management level of our operations, but also to keep us as a leading provider of sustainable cargo handling solutions.

Cargotec’s 2019 sustainability targets consist of long-term targets and annual targets. Long-term targets were agreed as part of Strategy Round 2018 and cover the strategy period of 20192021. Short-term targets are set annually to support the achievement of long-term targets and manage risks.

Safety continues to be our key focus area in 2019, along with the increased usage of renewable energy and development of supply chain sustainability program.

 

Annual targets 2019

Long-term targets until 2021

  • IIFR: 5.0 in assembly sites
  • 40 percent of electricity will be renewable
  • Global chemical risk management project launched (ready by 2021)
  • Re-audit 50 percent of suppliers that failed in the 2018 sustainability self-assessment questionnaire
  • Renewed human rights risk assessment implemented in M&A case
  • IIFR: 4.0 in all operations
  • 50 percent of electricity will be renewable
  • Offering for eco-efficiency sales: 2x sales growth compared to sales growth of other offering
  • 85 percent of sites are covered with centrally followed EHS targets
  • Supplier sustainability programme implementation is proceeding as per milestones


 

Our sustainability work

Sustainability work

Our focus is to ensure a sustainable and high supplier base performance on the basis of QDCI (Quality, Delivery, Cost Competitiveness, Innovation). With that, we want to contribute in meeting customer expectations.

We select our suppliers with care and on the basis of objective factors, such as quality, reliability, delivery and price. Each supplier is required to comply with laws and regulations and respect the international human rights.

We have established clear sustainability criteria for our suppliers. Criteria, which include environmental, health, safety and labour practices as well as compliance aspects, are being reviewed continuously. Of the topics in our supplier assessment checklist, about 20% are related to sustainability criteria.

We have clear processes and audit programmes for supplier management and collaboration development. Auditing and managing of sustainability-related issues are currently being integrated to the standard supplier management and audit progress.

Supplier Code of Conduct

Cargotec is a leading provider of cargo and load handling solutions with the goal of becoming the leader in intelligent cargo handling. As a technological leader, we can shape the way goods and materials are transported globally, bringing in various sustainability standards for the whole industry.

To support an economically, environmentally and socially sustainable development, companies need to renew their operations, innovate new business models and collaborate more with each other. The needed changes will be challenging; however, we see great opportunities to help companies move towards greater sustainability, and adapt our own operations to meet the United Nations sustainable development goals (SDGs).

UN sustainable development goals are globally agreed targets that are aimed towards ending poverty, protecting the planet and ensuring prosperity for all as part of a new UN sustainable development agenda. 

Although no company alone can ensure that the world will achieve the goals, they can show their support by taking small steps towards the targets with developing their operations in line with the UN goals. We firmly believe that with our ambition of being the leader in intelligent cargo handling, we are particularly impacting the five goals marked below.

SDGs

The latest Intergovernmental Panel on Climate Change (IPCC) report highlighted the need to decrease CO2 emissions at an unforeseen pace. The IPCC report is deeply linked to the UN SDGs through climate action, industry growth and innovation. We at Cargotec have developed our strategy to support both of these actions by focusing on digitalisation and productivity, and by advocating for a more-with-less approach both internally and in our customers’ operations.

Digitalisation plays a key role in decreasing emissions in the maritime and transportation industries. It will also be a major enabler for a wider social change towards a more circular economy. In the future, data sharing, common platforms and collaboration will act as key drivers in achieving these targets and connecting industries.

Digitalisation, added with electrification of traditional diesel-driven equipment, are ways with which we help support a more sustainable logistics industry. Cargotec’s offering for eco-efficiency portfolio supports our economic growth and sets an industry example on sustainability standards.

 

We are making a great effort to be more transparent, and are improving our communication with our stakeholders to increase environmental awareness and management. We proactively contact our partners to discuss the most relevant sustainability topics and during the year, we took part in several sustainable investment conferences.

Annual reporting

The annual report 2018 consists of the Annual review and the Financial review. The financial review includes the Board of Directors' report, the financial statements and the auditors' report.

Together with the annual report, Cargotec also publishes the corporate governance statement, the remuneration statement, and the GRI index for the year 2018. The annual review and the GRI index aim to describe Cargotec's strategy and its realisation in 2018, the company value creation process, as well as portray the significance Cargotec gives to sustainability issues as part of its business.

Cargotec’s sustainability reporting has been prepared in accordance with the GRI standards: Core option, defined by the global reporting initiative GRI. The GRI index has been assured by an independent third party.

Investor indices

We report to several third parties, which award us sustainability ratings that help our stakeholders to evaluate our sustainability performance. At the beginning of 2018, MSCI and Ecovadis both rated us among the most sustainable companies in our industry (class AA and gold respectively).  

We have been disclosing to CDP since 2010 and in 2018, Cargotec achieved a C ranking in the climate program. Noteworthy is however, that the biggest emission savings supported by Cargotec are achieved when using our products, not by cutting emissions from our own operations, as the environmental impacts of Cargotec’s own operations are small in comparison to the complete value chain. To give an example, around 2.5 mil barrels (1.8 mil tCO2e) of fuel savings were enabled by Cargotec port equipment solutions during past 6 to 10 years, whereas the emission from our own operations are on the level of 48,700 tCO2e annually. Cargotec enables the fuel savings by providing hybrid and electric solutions, which replace diesel-driven solutions. An aspect the CDP does not take into consideration in their ranking process.

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