Volvo 2014 Annual Report Download - page 32

The Group is dependent on stakeholders to develop its
competitiveness, in the same manner as its stakeholders are
dependent on the Group in many respects. Accordingly, the
Volvo Group strives, jointly with stakeholders, to create common
values in a manner that is sustainable in the long term.
1 PRODUCT DEVELOPMENT
VALUE CREATION
The Volvo Group’s oper-
ation comprises several
activities and products
that create value for our
stakeholders.
2 PURCHASING 3 PRODUCTION
• Costs for research and development
amounted to SEK 16.7 billion for 2014,
corresponding to 5.9% of net sales.
• Product development is focused on the
needs of customers, legislation, changes
in society and new technology.
• Safety and environmental issues are inte-
grated in product development.
• More than 90% of the environmental
impact from a truck occurs during use.
Consequently, product development
focuses on sustainable transport
solutions.
We work on developing energy-effi cient
solutions for our customers and on reducing
the environmental impact of our products.
Each new product shall have less environ-
mental impact than the product it replaces.
The Group works continuously to improve
the performance of products and our long-
term research and development focuses on
sustainable transport solutions, with a focus
on transport effi ciency, lower fuel consump-
tion and thus lower emissions, as well as on
alternative fuels, hybrid solutions, fully elec-
tric vehicles and transport solutions. This is
profi table for the customer, good for the
environment and a competitive advantage
for the Volvo Group. Safety, which has been
our guiding star since 1927, is another
important aspect. Our long-term vision is
zero accidents with Volvo Group products.
Our security program is focused on avoiding
accidents and preventing injury to the driver
and other parties involved but also on the
development of reliable products and
increased safety for people and goods.
For more information on product develop-
ment, please see page 36.
• The Volvo Group has approximately
36,000 subcontractors in the fi rst tier, of
which about 6,000 supply components
for the Group’s products.
• In 2014, the Group made purchases
of goods and services in an amount of
SEK 199.5 billion.
• The Volvo Group applies the principles in
its Code of Conduct in the purchasing
process.
• One job within the Volvo Group gener-
ates a number of other job opportunities
directly at subcontractors and indirectly
in the rest of society.
Responsible purchasing involves encouraging
correct behavior, managing risks and building
long-term relations with our suppliers to
improve social, environmental and business
ethics in the supply chain. The Volvo Group
strives to ensure that unethical values are
not incorporated into our products and
services, and we base our work on a mini-
mum standard in our Code of Conduct. We
believe that a high standard in our program
for responsible sourcing will result in high
productivity and stable long-term relations,
which will benefi t all parties.
For more information on purchasing,
please see page 49.
• At year-end 2014, the Volvo Group had
92,822 employees and 11,749 temporary
employees and consultants, of whom
45,337 employees and 4,801 temporary
employees and consultants were blue collar.
• The Volvo Group has 66 factories in 19
countries around the world.
• In 2014, the Volvo Group's wholly-owned
truck operations delivered 203,100 trucks.
Furthermore, the Group delivered 8,800
buses, 61,300 units of construction equip-
ment, 17,400 marine engines and 15,300
industrial engines.
Environmental work is governed by a com-
mon environmental policy, which mandates
that the Volvo Group shall comply with legal
and other applicable requirements as a mini-
mum standard and make pollution preven-
tion a prerequisite for all operations.
Another important tool is Volvo Produc-
tion System, with methods for streamlining
the operation and minimizing productivity
losses and also tools for documenting
work-related risks, indicators for measuring
health and safety performance and methods
for creating ergonomic workplaces.
At the end of 2014, 98% of employees in
production worked in units that are certifi ed
according to environmental and quality man-
agement systems, primarily ISO 14001 and
ISO 9001.
For more information on production,
please see page 48.
SUSTAINABILITY
PERSPECTIVE
The sustainability per-
spective is an inte-
grated part of the
Group’s operation.
Creating value in every
stage of the value chain
A GLOBAL GROUP 2014
STRATEGY
28