Electrolux 2013 Annual Report Download - page 157

Company
Management of
Electrolux
Company Management of Electrolux
Electrolux – a global leader with
a customer focus
Electrolux vision is to be the best appli-
ance company in the world as measured by its customers,
employees and shareholders.
Through profitable growth, innovative products under strong
brands, operational excellence, and dedicated employees
Electrolux creates the conditions to reach its vision.
Electrolux objective is to grow with consistent profitability,
see the financial goals below.
Dedicated employees who work together play a crucial role
in terms of creating the corporate culture necessary for
Electrolux to achieve the vision. Leadership at Electrolux in all
markets is distinguished by Passion for Innovation, Customer
Obsession and Drive for Results, see Electrolux core values
below.
A sustainable business
The company takes a consistent approach to sustainability in
the more than 150 countries where Electrolux operates. Under-
standing and engaging in challenges such as climate change,
creating ethical and safe workplaces, and adopting a responsi-
ble approach to sourcing and restructuring are important for
realizing the business strategy. Values such as respect, diver-
sity, integrity, ethics, safety and sustainability are at the core of
all employee actions when they interact with customers and col-
leagues around the globe. Key policies in this context include
the Electrolux Code of Ethics, the Electrolux Workplace Code of
Conduct and the Electrolux Policy on Corruption and Bribery.
In the Dow Jones Sustainability World Index (DJSI World) for
2013, Electrolux maintained industry leader in the Durable
Household Products category. The Dow Jones Sustainability
Indexes evaluate the performance of the world’s leading com-
panies in sustainability – from each industry on a global and
regional level, respectively. The evaluation is based on criteria
such as corporate governance, risk management, branding, cli-
mate change mitigation, supply chain standards and labor
practices.
In 2011, Electrolux initiated the roll-out of a global Ethics Pro-
gram, encompassing both training and a whistleblowing system
– the Electrolux Ethics Helpline. Roll-out continued in 2013 and
completion is planned for 2014. Read more about Electrolux
sustainability work on www.electrolux.com/sustainability.
Risk assessment
Risks in connection with the Group’s operations can, in general,
be divided into operational risks related to business operations
and those related to financial operations. Business risks are
normally managed by the operative units within the Group, and
financial risks by the Group’s treasury department.
Electrolux operates in competitive markets, most of which
are relatively mature. Demand for appliances varies with general
business conditions, and price competition is strong in a num-
ber of product categories. The Group’s ability to improve profit-
ability and increase shareholder return is based on three ele-
ments: innovative products, strong brands and cost-efficient
operations. Realizing this potential requires effective and con-
trolled risk management.
The Group’s development is strongly affected by external
factors, of which the most important in terms of managing risks
currently include: fluctuations in demand, price competition,
exposure to customers and suppliers, changes in prices for raw
materials and components as well as adapting production
capacity. In addition, the Group is exposed to risks related to
financial operations, e.g., interest risks, financing risks, currency
risks and credit risks.
The Group has established internal boards to manage these
risk exposures, see page 156.
The purpose of the internal audit function, Management
Assurance & Special Assignments, is to provide reasonable
assurance that the Group’s goals are met in terms of efficient
operations, compliance with relevant laws and regulations and
reliable financial reporting, see page 162.
Financial goals over a business cycle
The financial goals set by Electrolux aim to
strengthen the Group’s leading, global posi-
tion in the industry and assist in generating a
healthy total yield for Electrolux shareholders.
The objective is growth with consistent profit-
ability.
• Growth of at least 4% annually.
• Operating margin of at least 6%.
• Capital turnover-rate of at least 4.
• Return on net assets of at least 20%.
Key ratios are excluding items affecting
comparability.
Electrolux core values
Passion for Innovation Innovation is key to our success. We are constantly looking for new opportunities
and new ways to go forward. We are always open to better ways of doing things. Weare not afraid of taking
risks. An innovation may be anything new and different that improves the customer experience or otherwise
benefits the customer.
Customer Obsession The wants, wishes and views of our customers guide our every action. Weare curi-
ous about our customers and continuously aim to learn more about them and their needs. We keep our
promises to our customers and we capture insights about and anticipate our customers’ future needs. We
strive to create added value for customers in all aspects of our work, ultimately aiming to deliver the best
customer experience.
Drive for Results We strive for a visible, measurable benefit from everything we do. We do not confuse
effort with results, and value matters more to us than mere volume. We focus on the essential and aim at
simple, informal, lean and direct ways of doing things.
155ANNUAL REPORT 2013