Sustainability risk management

Gränges works actively with risk management to monitor and minimize risks in a structured and proactive manner. Sustainability risks are included in the Group risk assessment, which is owned and validated by Group Management.

Supply chain risks

- Social risks and human rights violations are mainly related to indigenous rights in the extraction, mining and smelting activities. Extractive activities also carry a risk of forced and child labour, although there are few reports of this in aluminium mining. Environmental risks mainly occur in mining activities where there are risks related to e.g. biodiversity loss, leakage and air emissions. Further, refining and smelting activities are energy- and water intensive processes. Corruption risks are mainly linked to mining approvals, regardless of the country’s level of economic development or political system.

Workplace safety

- Health and safety risks mainly relate to incidents or accidents in the cast house or rolling mills, which can cause damage on fingers, hands, feet and legs. Other risks are exposure to chemicals and risk of fire, which can be hazardous to employees’ health. Also, employees and other individuals may be injured if the implementation of safety procedures is unsuccessful or inefficient.

Employee

- Employee risks are mainly related to lack of access to and difficulty to attract and retain qualified and skilled employees, due to high competition on the labour market. Gränges operates in a traditional industry where competition for qualified employees is high. Job opportunities are located outside metropolitan areas which tends to reduce the number of available qualified candidates. There are also risks relating to not having a diverse workforce as this is a prerequisite for a productive and innovative organization.

Environmental

- Environmental risks are mainly related to emissions to water, soil and air or releases of environmentally hazardous substances resulting from incidents and accidents in Gränges’ production facilities, such as fire, oil spill, or leakages. Other environmental risks are related to natural resource scarcity.

Climate

- Climate transition risks include emerging regulation to incentivize reduced carbon emissions as well as carbon pricing mechanisms which could lead to higher costs for Gränges, e.g. increased costs in carbon taxes. Other transition risks include shifting customer and consumer preferences towards products carrying a lower climate impact, which could reduce the demand for Gränges’ products. Climate physical risks are mainly related to acute physical risks with increased severity and frequency of extreme weather events. This could disturb not only direct operations but also the infrastructure supporting the production, including electricity supply and transportation.

Ethical and compliance

- Gränges operates in many different markets, with local laws and rules. It can sometimes be challenging as complex market conditions can lead to situations where employees are uncertain how to act. Misconduct, fraud, violation of laws and regulations and internal policies, or other improper acts carried out by Gränges’ employees, representatives or partners could have an adverse effect on Gränges’ business, reputation, profit and financial position.