Long-term plan

We are convinced that our long-term success as a company is connected to our part in improving environmental and social conditions in the world. This requires a business model that takes into account aspects of corporate responsibility, covering our own operations and suppliers as well as our services. Therefore, sustainability is a natural part of our daily business operations and integrated into our value chain.

Our Corporate Responsibility (CR) focus covers all of our operations, services and IT solutions. We recognize that our sustainability impacts occur throughout our value chain. Our CR long-term plan is based on our commitment to the United Nations Global Compact and the OECD Guidelines for Multinational Enterprises.  We view the opportunities and challenges of our high impact aspects via three CR objectives:

  • Minimize environmental impact
  • Be an ethical forerunner in global society
  • Create value for stakeholders

CR objectives - background

Globally, greenhouse gases have continued to rise despite efforts to mitigate climate change. Many reports and subsequent analysis have shown this, e.g. Intergovernmental Panel on Climate Change (IPCC) Fifth Assessment report. A significant change in behaviour is needed in both the short term and long term. 

Our footprint is mainly caused by energy consumption in offices and data centres. In addition, business travel accounts for about one third of our footprint. Hence, to us, minimizing our environmental impact means reducing energy consumption, increasing energy efficiency and replacing travel with online conferencing options. The bigger opportunity, however, lies in reducing emissions in other industries through our innovative IT solutions and services. According to the Global eSustainability Initiative Smarter 2020 report, ICT can cut global emissions by 16.5%, which is more than seven times the sector’s own footprint. We are committed to increasing the environmental friendliness of our data centres and implement solutions that improve our customers’ sustainability as well as our own.

Being an ethical forerunner in global society means that we want to show a good example across our countries of operation. The European Union’s first Anti-Corruption Report, published in early 2014, concludes that corruption continues to be a challenge in Europe, and that the situation varies from one member state to another. In recent years, some Nordic companies have suffered from corruption cases, too. In 2013, the European Union launched an ICT-sector guide on implementing the UN Guiding Principles on Business and Human Rights. To us, it means focusing on human rights, especially in our supply chain. Our approach is not only compliance-based, but is intended to create a culture based on transparency and openness. We call it open source culture.

Creating value for stakeholders touches upon our customers, employees and investors - our main three stakeholder groups - as well as society as a whole. When we deliver sustainable IT services and solutions to enterprises and society, we help to improve environmental, societal and economic conditions in the world.  Furthermore, we help to increase our own profitability. When we are profitable, we have a significant positive impact on the society as an employer, taxpayer and innovator. Thus, high customer satisfaction, being the employer of choice and ensuring long-term financial soundness go hand in hand.

The following table summarizes our long-term targets for prioritized CR aspects. 

 

Create value for stakeholders
CR Aspect Long-term target Result 2014 (2013)
Customer Experience Customer Experience Index 8.2 by 2016 (scale 1–10) 7.51 (7.53)
Quality of Products and Services ISO 9001 certification based on business needs (percentage of employees) 65% (55%)
  ISO 27001 certification based on business needs (percentage of employees) 35% (33%)
  All sites above 50 employees to be certified with ISO 14001 by 2015 (percentage of employees) 62% (21%)
  ISO non-conformities to be closed according to the requirements Goal met (Goal met)
Financial Performance Achieving 10% EBIT margin by 2016 4.0% (5.3%)
  Dividend increasing annually in absolute terms (minimum 50% of net results)1 EUR 1.00, and an additional dividend of EUR 0.30. 11% increase in dividend, 208% of net results, incl the ordinary dividend only (7% increase in dividend, 104% of net results)
  Net debt/EBITDA 1.5 as an upper limit in the long-run -0.4 (0.0)
     
Be an ethical forerunner in global society
CR Aspect Long-term target Result 2014 (2013)
Business Ethics No breaches of CoC 0 (2)
  All employees trained on CoC and Anti-corruption annually 74% (New target)
Procurement and Supply Chain 100% of suppliers serving Tieto on regular basis to adhere to Supplier Code of Conduct Rule 30% (New target)
  Zero violations of Supplier Code of Conduct Rule of contracts 0 (0)
Employee Health and Wellbeing 100% of employees (minimum 95%) to have energy above work related demand 94% (94%)
Corporate Governance CR on the LT and BoD agenda Goal met (Goal met)
Transparency and Openness No infringements and deviations from Securities markets act 0 (0)
  CR reports published (GRI, UNGC, CDP) Goal met (Goal met)
     
Minimize environmental impact
Aspect Long-term target Result 2014 (2013)
Energy Consumption Reduce total indirect energy consumption by 3.5% annually (kWh) 120 689 MWh, -5% (127 483 MWh, -7%)
Environmental Management System All sites above 50 employees to be certified with ISO 14001 by 2015 (=96% of employees2) 62% (21%)
  ISO non-conformities to be closed according to the requirements Goal met (Goal met)
     

CR risks and opportunities

To address CR related risks and opportunities, we strive to integrate the CR impacts at the core of our business, and to include more CR elements in our business processes and systems. We have identified four main risks related to CR. All four risks are connected to some of our highest priority aspects identified in our latest materiality analysis (autumn 2013). 

We recognize that our supply chain poses potential risks in terms of human rights and labour rights. We strive to mitigate these risks via our Supplier Code of Conduct Rule, supplier management and assessments. In addition, by increasing our understanding of supply chain related impacts we will be able to improve human rights as well as labour rights conditions together with our suppliers. In this context, it is imperative that we understand and recognize the differences between the cultures in the Nordics and in other Tieto countries.

Corruption is another potential CR risk, not only for Tieto but also for enterprises and society at large. Our corruption risks relate to both procurement and sales, especially in Eastern Europe and Asia. We involve Tieto and mitigate via our Code of Conduct and Anti-Corruption Rule implementation, communication with suppliers, and training of sales personnel and partners. 

Climate change is a risk from our operations perspective, and by that being a part of the global problem. We mitigate this risk via environmental management, green IT and lowering customers’ emissions with sustainable IT. 

Employee health is a risk that is related to knowledge-intensive work and the transformation of the IT sector. We mitigate this via communication, line manager attention and follow-up, and by offering our employees a safe and healthy work environment.

As an IT services provider, our biggest CR opportunities relate to the sustainability of our IT services and solutions, and our role in creating a society where responsible and sustainable business is the norm. We have measured the sustainability impacts of IT by calculating the emission reductions from our own digital transaction services and other digital services replacing paper since 2010, and are committed to continuing the study of sustainability effects of IT, as well as to continuing the development of sustainable IT solutions.

Our proactive approach is embedded in our monitoring and follow-up processes. Our whistle-blowing process allows anonymous and confidential reporting on policy and rule violations, or any unethical behaviour, to the General Counsel of the company. The process is designed to ensure that persons reporting violations will not be subject to any retaliation. 

Management of our CR aspects has an impact on the surrounding society, the environment as well as on our long-term financial soundness. The CR demands from our customers have intensified during the past years. For many of our customers, a CR requirement such as compliance with the United Nations Global Compact is a minimum-level requirement.