Targets and target fulfillment
Sandvik has long-term financial targets focusing on growth, profitability, dividend and a strong financial position. The 2030 sustainability targets focus on the areas of circularity, climate, people and ethics.
Target: A growth of ≥5 percent through a business cycle, organically and through acquisitions.
The revenue growth 2016–2020 was 0 percent. In 2020 the organic growth was –11 percent, due to a slow-down related to the Covid-19 pandemic.
Trough EBIT margin
Target: A trough EBIT margin of ≥16 percent rolling 12 months, adjusted for items affecting comparability and metal prices.
The EBIT margin, adjusted for items affecting comparability and metal prices, amounted to 17 percent in 2020. The EBIT margin was 13, 16, 18 and 18 percent in 2016, 2017, 2018 and 2019, respectively.
1) The growth and dividend targets refer to average through a business cycle, which is here defined as 2016–2020.
We have 2030 Sustainability Goals in four areas and we report on KPIs for our own operations to track progress towards targets. In addition to our own operations, we also work with customers and suppliers to achieve the goals.
We build circularity
Target: Our target is to reduce our waste to 38.81) ktons by 2030, a 50 percent reduction. To be in line with this target we should reduce waste to 71 ktons by 2020.
We reduced our waste by 18 percent to 71 ktons, mainly due to reduced production volumes. We have excluded tailings from our mine operations and slag from our steel manufacturing, amounting to more than 80 percent of the total waste, since our ability to impact these volumes is limited.
We shift climate
Target: Our target is to reduce our CO2 emissions to 1661) ktons by 2030, a 50 percent reduction. To be in line with this target we should reduce CO2 emissions to 304 ktons by 2020.
CO2 emissions fell by 17 percent, mainly due to low activity levels caused by the Covid-19 pandemic. Production was shut down in India in the second quarter and traveling was reduced to a minimum.
We champion people
Target: Our target is to reduce our Total Recordable Injury Frequency Rate (TRIFR) to 2.31) by 2030, a 50 percent reduction. To be in line with this target we should reduce the TRIFR to 4.2 by 2020.
The number of injuries recorded during the year (133) and the Total Recordable Injury Frequency Rate (3.2) marked the lowest outcome ever for Sandvik. Regrettably, two fatalities were reported, the first since 2015.
We play fair
Target: Our target is to increase the share of women in managerial positions to one third by 2030. Our target was to have 18.6 percent female managers by 2020.
The share of female managers increased to a new top level by the end of the year, 18.5 percent. We have a plan in place to accelerate the increase of female managers in the years to come, which is necessary to achieve the 2030 goal.
The baseline for our Sustainability Goals is the average outcome 2016–2018. The dotted line is an indication of how well we are in line with the 2030 targets. TRIFR and CO2 emissions are exceeding the required results, waste is on par and female managers below.
1) The targets are adjusted for structural changes.