Atlas Copco 2008 â tough ending to a record year Annual Report ...

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SUSTAINABILITY REPORTSustainability and Reporting DefinitionsCarbon dioxide (CO 2)The most common greenhouse gas found in theatmosphere. It is generated in various processesin nature as well as in the combustion of mostfuels.Carbon Disclosure Project (CDP)Independent organization that encouragescorporations to disclose their greenhouse gasemissions.Cooling agentsDifferent cooling agents added to on-site equipment(including refrigerators and air conditioners)and/or finished products leaving the site duringthe year is reported.Core indicatorKey Performance Indicators defined in the GlobalReporting Initiative guidelines to be of interestto most stakeholders and deemed to be materialto the organization.Corporate Responsibility (CR)Concept whereby organizations consider the interestsof society by taking responsibility for theimpact of their activities on customers, suppliers,employees, shareholders, communities andother stakeholders, as well as the environment.CorruptionOECD’s guidelines define corruption as when acivil servant or other person with influenceunfairly or illegally takes advantage of his positionto achieve benefits for himself or anotherperson.Cost of salesCosts incurred to manufacture goods(and provide services) to be sold, includingcosts for material, salaries, and depreciation ofequipment, but excluding costs for marketing,administration, and product development.Employee turnover salariedCalculated as external resignations of salariedemployees/average salaried employees.Energy consumptionEnergy consumed for production includes production,heating, cooling, ventilation, as wellas fuel delivered with rental products. Energyconsumed during transport is measured fromall inbound and outbound transports in cubicmeters of fuel.Environmental Management System (EMS)The part of the overall management system thatincludes organizational structure, planning activities,responsibilities, practices, procedures,processes, and resources for developing, implementing,achieving, reviewing, and maintainingthe organization’s environmental policy. An EMSinvolves a systematic and documented approachto environmental management.Fossil fuelsFuels originating from organisms of an earliergeological age, including coal, oil, natural gas,and peat.Global CompactUN initiative with ten principles on corporations’activities focusing on human rights, labor practices,environmental, and corruption considerations.Global Reporting Initiative (GRI)Independent international organization workingto develop guidelines for sustainability reporting.Read more at www.globalreporting.org.GHG ProtocolGHG Protocol Corporate Standard providesstandards and guidance for companies andother organizations preparing a GHG (greenhouse gas) emissions inventory. Through theuse of the standardized approaches and principles,it provides a clear and transparent reportingmechanism.Governmental Organization (GO)Legally constituted organization created bygovernment, such as the OECD.InfluencerIndividual or group who is expected to have anindirect impact on an organization, company orits stakeholders through influence.ISO 9001International standard developed by the InternationalOrganisation for Standardization (ISO), forsetting up and certifying quality managementsystems.ISO 14001International standard developed by the InternationalOrganisation for Standardization (ISO), forsetting up and certifying environmental managementsystems.ISO 26000International standard providing guidelines forsocial responsibility (SR).The guidance standardwill be published in 2010 as ISO 26000 and compliancewill be voluntary. It will not include requirementsand will thus not be a certificationstandard.Life Cycle Assessment (LCA)Method for assessing the total environmentalimpact of a product or service “from cradle tograve”, including all phases of production, use,and final disposal.Megawatt hour (MWh)Measure of electrical energy consumption equalto the energy provided by a one megawatt powersource in one hour. Mega is the metric prefix forone million. In the report, gigawatt hour (GWh) isalso used as a measurement unit. Giga is theprefix for one billion.Non Governmental Organization (NGO)Legally constituted organization created byprivate persons or organizations with no participationor representation of any government,e.g. Amnesty International and Greenpeace.OHSAS 18001International standard, developed by the InternationalOrganisation for Standardization (ISO), forsetting up and certifying occupational health andsafety management systems.Ozone Depleting Potential (ODP)ODP indicates the ozone-depleting potential ofa chemical substance i.e. a substance that has anegative impact on the earth’s protective ozonelayer.Packaging materialMeasured as the consumption of outboundpackaging materials, i.e. materials used for packingAtlas Copco original products and parts suchas paper/cardboard, plastic, wood, packing chips(foam) and iron/steel.Rating institutesProvide indices based on companies’ financialperformance as well as their sustainability performance(ethical indexes), e.g. Dow Jones.REACHEuropean Community regulation on chemicals,deals with the Registration, Evaluation, Authorizationand Restriction of Chemical substances.Sick leaveCalculated as absence from work due to theemployee’s own illness, and does not includeabsence due to childcare or care of relatives andnext-of-kin. The sick leave indicator used in theAtlas Copco Group is measured as the numberof sick-leave days in relation to total number ofworking days.StakeholderIndividual or group that is expected to significantlyaffect or to be significantly affected by acompany’s activities, products, and solutions.SustainabilityMeeting the needs of the present without compromisingthe ability of future generations tomeet their own needs. It is also improving qualityof life for everyone, now and for generationsto come and it has three dimensions: economic,environmental, and social sustainability.WasteReported in tons and in the following categories:metal scrap from production, plastic, paper, oilsand solvents, paint, rocks and concrete, contaminatedsoil and mixed waste. The waste is classifiedas: reusable, recyclable, recoverable, landfill,and regulated waste. Regulated waste requiresspecial treatment and disposal methods.WaterWater consumption in m 3 , own and purchased,is measured at internal water meters or bywater utility companies.WEEEEU Waste Electrical and Electronic EquipmentDirective imposes responsibility for the disposalof waste electrical and electronic equipment onthe manufacturers.Work-related accidentIncludes illness or injury resulting in loss of consciousness,restriction of work or motion, ortransfer to another job, and requiring medicaltreatment beyond first aid, not including accidentsoccurring when traveling to or from work.116 Atlas Copco 2008
Corporate Governance ReportAtlas Copco AB is incorporated under the laws of Swedenwith a public listing at NASDAQ OMX Stockholm AB (OMXStockholm). Reflecting this, the corporate governance of AtlasCopco is based on Swedish legislation and regulations: primarilythe Swedish Companies Act, but also rules of OMXStockholm, the new version of the Swedish Code of CorporateGovernance, the Articles of Association and other relevantrules. This Corporate Governance Report has not beenreviewed by the company’s auditor.Atlas Copco’s Articles of Association, as well as an item-by-itemreport on Atlas Copco´s compliance with the Swedish Code ofCorporate Governance, are available on the Group’s websitewww.atlascopco.com/ir.The Swedish Code of Corporate Governance is available inEnglish on www.bolagsstyrning.se/en.ShareholdersIn the Atlas Copco Share section, pages 130–133, the shareholderstructure, share capital, voting rights, and dividend policy aredescribed as well as the trading and market capitalization.Annual General MeetingThe Annual General Meeting shall be held within six months ofthe close of the financial year. All shareholders registered in theshareholders’ register who have given due notification to the companyof their intention to attend may attend the meeting and votefor their total share holdings. Shareholders who cannot participatepersonally may be represented by proxy and a proxy form ismade available for the shareholders. A shareholder or a proxyholder may be accompanied by two assistants.Shareholders representing 50.0% of the total number of votesin the company and 47.5% of the shares attended the AnnualGeneral Meeting held in April 2008 in Stockholm, Sweden.Among other matters, all specified in the Notice, the AnnualGeneral Meeting elects Board members for a period of one year.A Board member can be nominated for re-election up to andincluding the year the member reaches the age of 70. Board membersare nominated in accordance with the process proposed bythe Nomination Committee and adopted by the Annual GeneralMeeting.Nomination ProcessBoard membersThe process for nomination and presentation of Board Membersfor (re-)election at the 2009 Annual General Meeting has beenperformed in accordance with the nomination process and thecriteria adopted at the 2008 Annual General Meeting.As prescribed by this process and criteria, during October 2008the Chair of the Board of Directors, Sune Carlsson, contacted thefour largest shareholders listed in the shareholders´ register as ofSeptember 30 to establish the Nomination Committee. In additionto Sune Carlsson, the committee representatives were PetraHedengran, Investor AB, Chair, Ramsay Brufer, Alecta PensionInsurance, Mutual, KG Lindvall, Swedbank Robur fonder, andHåkan Sandberg, Handelsbanken Fonder. The names of theCommittee members were made public on October 17, 2008.A way to contact the Nomination Committee directly was alsoprovided. The Committee members represented some 28% of allvotes in the company. Late 2008 the Committee began preparing aproposal to be submitted to the 2009 Annual General Meetingcovering the issues specified at the 2008 Annual General Meetingand the Code of Corporate Governance.In line with the formal evaluation process adopted by theCommittee, Sune Carlsson made an evaluation of the workperformed and the processes employed by the Board and itsmembers. This evaluation was presented to the NominationCommittee. He also presented his assessment of the need for specialcompetence considering the current phase of the company’sdevelopment and, together with the Nomination Committee,compared these needs with the resources presently availablewithin the Board. Members of the Nomination Committee alsomet with Board members for discussions.When the notice of the Annual General Meeting 2009 isissued, the Nomination Committee will issue a statement on AtlasCopco´s website explaining its proposal regarding the Boardmembers as stated in the Code of Corporate Governance.In the notice to the 2009 Annual General Meeting, the Committeewill present its proposal regarding Chair of the AnnualGeneral Meeting, number of Board members, names of theproposed Board members, as well as Chair and Vice Chair of theBoard. It also submits its proposal for remuneration to the Chair,Vice Chair and other Board members not employed by the company,as well as a proposal for remuneration for committee work.In addition, the Committee will present a proposal for the processand criteria that shall govern the appointment of the members ofthe Nomination Committee until the Annual General Meeting2010 as well as a list of decision points for this Annual GeneralMeeting, including election of auditor.Neither Sune Carlsson nor the other members of the NominationCommittee received any compensation for their work inthe committee.AuditorAt the 2006 Annual General Meeting the audit firm KPMG AB(KPMG), Sweden, was re-elected until the 2010 Annual GeneralMeeting in compliance with a proposal from the NominationCommittee.Board of DirectorsAt the 2008 Annual General Meeting, nine Board members wereelected, one of which is the President and Chief Executive Officer(CEO). The Board also has two members, with personal deputies,that are appointed by the labor unions.Atlas Copco 2008 117
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Atlas Copco2008 - tough ending to a
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• Strong order growth in most are
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Revenues by business areaRevenues b
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educing Atlas Copco’s main enviro
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Many new products were introduced d
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TargetsFinancial targetsAtlas Copco
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StructureThe Group is organized in
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New divisionEffective January 1, 20
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80 000Revenues and marginsMSEK %286
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administration reportconcentrated t
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administration reportEnvironmental
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ADMINISTRATION REPORTCompressor Tec
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