Electrolux 2007 Annual Report Download - page 47

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Products with superior environmental performance also have a
higher profi t margin, accounting for approximately 17% of total
units sold and generating approximately 22% of gross profi t.
These products are playing an increasingly important role in the
Electrolux offering.
Improving energy-effi ciency in the Group’s operations
Electrolux is committed to reducing energy consumption across
all operations, which simultaneously lowers CO2 emissions and
cuts costs. Electrolux has set a 15% reduction target for Group
energy consumption by year-end 2009 (in relation to energy use in
2005). Achieving this goal is expected to enable a CO2 reduction
of 100,000 tons and generate an estimated saving in operational
costs of approximately SEK 100m annually.
Communicating the role of energy-effi cient appliances
Through media, Electrolux is active in communicating to consum-
ers as well as to policy makers, the role of energy-effi cient
ap pliances in tackling climate change. One in three appliances in
operation in Europe — or an estimated 188 million products — are
over ten years old. Replacing these energy-thirsty products with
the highest effi ciency models has the potential to reduce CO2
emissions by approximately 18 million tons a year.
United Nations Global Compact
Electrolux supports the United
Nations Global Compact and its ten
principles, which cover human rights,
labor standards, business ethics and
the environment.
Ethical employer and business partner
A proactive approach to sustainability lends trust and credibility to
the Electrolux brand. The Group’s corporate governance struc-
ture therefore emphasizes ethical and environmental priorities, as
well as the health and safety of its employees. The Electrolux
Code of Ethics, Code of Conduct and Environmental Policy per-
meate operations on all levels, from Group management to the
practices of individual employees. Electrolux conducts training
and continuous monitoring of compliance to the codes. Employ-
ees, customers, investors and other stakeholders are also
engaged in dialogue to help Electrolux in measuring its perfor-
mance and identifying areas of improvement.
Responsible sourcing
All suppliers must comply with the Electrolux Code of Conduct
and Environmental Policy. Supplier transparency also helps assure
that the Group’s products are manufactured with respect for
human rights, health and safety, and the environment. These cri-
teria are integrated in Electrolux purchasing policies and are
among the key factors that determine choice of suppliers. The
Group has a global, risk-based approach to monitoring the supply
chain.
Restructuring
In order to maintain competitiveness and ensure access to new
markets, Electrolux is relocating some production from countries
with a higher cost base to those offering lower costs. A decision
to close factories or downsize production affects both individuals
and communities. Responsible management of such changes
can minimize negative impact through transparent procedures
that are adapted to local needs. This also involves consulting a
wide range of stakeholders, including labor representatives, politi-
cians at local, regional and national levels, as well as public
authorities.
Setting up operations in emerging economies also generates
positive changes to local communities. It creates indirect impacts
by prioritizing local suppliers and transferring cutting-edge tech-
nologies to these markets.
As of summer 2009, consumers will fi nd IKEA-
designed appliances manufactured by Electrolux in
IKEA stores Europe-wide.
IKEA has far-reaching demands and expectations
on their suppliers and social and environmental crite-
ria are among the most rigorous. Inclusion in their
product portfolio is not only a litmus test of the
Group’s practices; it is testimony to the fact that a
sustainable approach creates greater business
value.
Success story: IKEA — a relationship built
on sustainable values
Electrolux shares IKEA’s commitment to promoting
good business practices. The Group endorses the
IKEA Code of Conduct, and will work with IKEA to
monitor that Electrolux facilities and suppliers meet
their high standards. Both IKEA and Electrolux
Codes of Conduct are grounded on the same univer-
sal values regarding human rights, the environment
and workplace practices.
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