Materiality analysis

Through our materiality process and stakeholder engagement, we have pinpointed the most relevant topics to Electrolux.

Our sustainability approach is designed to address the topics of greatest importance to Electrolux and our stakeholders. The most important topics have been expressed as nine promises, supported by 2020 goals and key performance indicators (KPIs).

The relevance of an issue is determined by three criteria:

The degree of impact caused by our activities along the value chain.
How much the issue impacts our business strategy.
How the issue might affect stakeholder relationships with Electrolux.

For Electrolux, the most important stakeholders are customers, consumers, shareholders and employees. Their priorities and how they reflect our sustainability approach are outlined in Stakeholders inform our approach section of the report.

2017 and beyond

New and updated legislation is due to be introduced in several key areas over the next few years.

Human trafficking, addressed by the UK Modern Slavery Act, will come into effect in 2017.

The new EU energy label directive is expected to be adopted in 2017/2018. Future energy classes will be from A to G, with no products initially in the A class. All products should be relabeled within 5 years after adaptation of the directive.
EU legislation towards a circular economy is under development.
China, Japan, Australia and New Zeeland will apply new performance standards for refrigerators that will change their national energy efficiency ratings (2017/2018).
New regulation on high-impact greenhouse gases will be introduced in Europe, the US and in Asia/Pacific.
Legislation on sustainability reporting will come into effect in Sweden in 2017.

The Sustainable Development Goals (SDGs) have an impact on the response to global challenges, broadening the discussion among and between businesses, governments and civil society. They help us align our work in accordance with the priorities of society at large.

An evolving agenda

Although many of the sustainability issues facing Electrolux remain the same over a long period, their importance changes over time. Below are the areas where our internal analysis points to an emerging area, or shows increased importance for business and our stakeholders. These topics appear in no particular order and their importance is not inter-related.

Topic	Description	Our response
Climate change	The COP 21 Paris agreement on the reduction of greenhouse gas emissions in order to limit global warming to well below 2^oC.	Continued focus on key areas in our sustainability agenda and the 50% carbon reduction target. Electrolux CEO signed a commitment to adopt Science Based Climate Target. See Our climate targets.
Renewable energy	Relevance increased during 2016, as leading sustainable businesses demonstrated the feasibility of a strong renewable energy strategy.	Setting a target to increase renewables for our operations to 50% by 2020, beginning with manufacturing sites in Europe.
Food waste	Increasing in importance over several years, driven by growing concerns, and public and media interest. Roughly 1/3 of the world’s food for human consumption is wasted every year – approximately 1.3 billion tonnes.	Developing technologies for keeping food fresher, longer. Community engagement, e.g. raising awareness of food waste (see food-waste awareness), and crowdsourcing initiatives to promote sustainable and healthy food (see iJam and Electrolux Ideas Lab) and Global Gastronomy Day.
Circular economy	Emerging concept on a global scale. Relevance is increasing rapidly as businesses include circular principles in their products and the EU prepares legislation under the overarching themes of the circular economy.	Establishing strategic partnerships with suppliers to access high-quality recycled plastics. Increasing dialogue with EU legislators on product durability-related issues. Participating in OECD environmental meeting at ministerial level in 2016, to discuss climate change and circular economy.
Human rights	Increasing in importance over the long-term, as indicated by investors. New international standards and legislation are emerging, including the UN Guiding Principles on Business and Human Rights as well as conflict mineral legislation in the US and EU.	We are committed to respecting human rights in our own operations as well as along our supply chain and have specified objectives and KPIs in our promises ‘Always act ethically & respect human rights’ and ‘Improve sustainability in the supply chain’ to fulfill this commitment. In 2016, we conducted a corporate human rights risk assessment and established a governance structure.
Responsible taxation	Sustained interest in this topic, with socially responsible investors requesting increased transparency on tax payment approaches and emerging legislation worldwide.	We are transparent on taxation in the Annual Report and by making our tax policy publicly available.