Sustainable Development Risk

Sustainable Development Risk Management
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Risk - Contaminated soil

Most of the Group’s facilities are built on land not previously used by polluting operations. No emissions or accidents of significance for the soil or groundwater were registered in 2022. There is limited soil pollution at three facilities. The pollution is of a historical nature, and remediation measures are ongoing at one facility. At one facility in Sweden, the environmental authority has requested an in-depth investigation of possible soil pollution. In 2021, demands were made on one of the Swedish units regarding possible partial responsibility for investigations and action at a former landfill site. In 2022, the regulatory authority concluded that HEXPOL cannot be considered to be involved in or responsible for the pollution.

Risk management

Regular assessments of the risk for soil pollution and other environmental damage are made in conjunction with acquisitions. Where it is considered necessary, sampling of soil and groundwater is conducted. Through risk analysis and preventative actions the probability and consequences of uncontrolled emissions are minimized.

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Risk - Hazardous substances in buildings

The roofs of certain buildings comprise Eternit tiles containing asbestos. The risks are considered minor and do not require actions to be taken until the roofs are to be replaced. According to legislation in Sweden, the Group performed an inventory of the properties with respect to PCB (polychlorinated biphenyls). Some small amounts of PCB were found in window seams in a number of buildings and the caulking compound will be removed as the windows are gradually replaced. The risks to humans and the environment are very low.

Risk management

Regular assessments of the presence of asbestos and PCB are made in conjunction with acquisitions. In accordance with the legislation in different countries inventories has been carried out and relevant precautions have been taken. Further actions is currently not applicable.

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Risk - Climate-related risks

Two of the facilities have identified floodage as a climate-related risk and certain precautions have been taken. Four facilities are located in areas that could be exposed to extreme weather.

Risk management

The Group keeps itself informed of risk analyses on climate changes that are performed in countries in which it has operations. Climate-related risks are taken into account in conjunction with acquisitions and supplier assessments.

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Risk - Environmental adaption of products

The interest for environmentally adapted products is increasing in many industries and many of the customers sets requirements regarding phase-out of hazardous substances and other properties that have importance to health and environment. If the requirements are not met, there is a risk that the deal will be lost.

Risk management

The Group is taken an active role within the area and is offering knowledge that contributes to environmental friendly product development. Many of the Group’s “green products” show favourable business performance, for example Dryflex Green which contains bio-based raw materials, and Dryflex Circular which contains recycled polymers.

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Risk - Human rights

The risk for any violation of the human rights at HEXPOL’s production facilities are considered low. The main part of the Group’s suppliers of raw material is global chemical companies and the risks around human rights are considered as low. HEXPOL has identified suppliers of natural rubber as a potential risk area. Formal sustainability audits have therefore been performed at natural rubber plantations in Sri Lanka. The situation around human rights was assessed as good.

Risk management

HEXPOL’s Code of Conduct (Materializing Our Values) specifics the view of human rights. The Code of Conduct is supplemented by the commitments under the UN Global Compact. The whistleblowing system gives employees the opportunity to sound the alarm and draw attention to possible irregularities. In the collected data for the annual Sustainability report, all companies must take a stand on questions regarding human rights in their own operation and among the suppliers. No significant deviations have ever been registered.

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Risk - Anti-corruption

The Group has operations in both industrialized and developing countries. No matter where the operations are, there is a risk that sound valuation principles are not applied. In the materiality analysis, good business ethics are therefore afforded a very high priority. The message from the Group management is that zero tolerance is applied for anti-corruption and lack of business ethics.

Risk management

The Global Compact and the Business Ethics Guidelines guide employees in questions regarding what is and is not allowed in contacts with business partners. In the Compliance Program the managers confirm, through their signature, that the rules are followed. Managers and employees within sales and marketing are part of the mandatory educations within the area. In the collected data for the annual Sustainability report, all companies must take a stand on how they have worked against corruption during the year. The questions originate from the Global Compact. No significant deviations have ever been registered.

Risk - Occupational health and safety risks

Poor work environment in production facilities can cause ill health and accidents at work, with significant consequences for individual employees.

Risk management

The Group has a zero vision for work-related accidents and pursues an active and systematic work environment policy to reduce the risk of work-related illnesses and accidents. Prevention is particularly important and is described in the annual report.

Market Risk
Market Risk

Strategic And Operational Risk
Strategic And Operational Risk

Legal Risk
Legal Risk

Financial Risk
Financial Risk

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