With COP25 due to take place in Madrid in early December 2019, the eyes of the world are on sustainability. Companies and consumers are increasingly aware of sustainability, including the environmental footprint of the products and materials in their supply chains.
Sustainability has often been seen as being a purely ethical consideration for consumers. Governments have taken the lead in creating legislation for saving energy, reducing waste and improving efficiency. However, today’s consumers are increasingly willing to pay a premium for sustainable products – a 2018 report from Nielsen indicates that consumers are willing to part with 66 percent more for products made by sustainable companies.
Therefore, today’s Original Equipment Manufacturers (OEMs) are looking at sustainable performance as an important competitive advantage. This is manifesting itself in demand for accurate and transparent data on carbon emissions that consumers will use when choosing products.
The trend shows that sustainability isn’t just the right thing to do. It’s also good for business and for us at Outokumpu, it builds on the important steps we’ve been taking for decades to reduce the environmental impact of our products and processes.
Environmental Product Declarations
Our latest achievement is to publish Environmental Product Declarations (EPDs) that cover our entire stainless steel production. These EPDs are independently verified and registered by a German association of building product manufacturers, the Institut Bauen und Umwell (IBU).
The intention of EPDs is to provide transparent documents to enable OEMs to compare the environmental impacts of products. They can then use the data to calculate the environmental footprint of their own products so that end users can make an informed decision on their own environmental footprint.
Our EPDs cover our entire crude steel production and focus on:
- Cold-rolled stainless steels
- Hot-rolled stainless steels
- Long products
While the EPDs were originally developed to meet demand from the building industry, they can be applied easily to other sectors.
Focusing on reducing emissions
Establishing the set of EPDs is the latest step in a long journey of sustainability for Outokumpu that started in 1975. We recognized then that sustainability made sense for the bottom line and we have developed our own sustainability strategies to align closely with the United Nations sustainable development goals. According to the World Steel Association, energy can account for 20-40 percent of the cost of steel. However, it need not be that high and we’ve found that the greater the energy efficiency, the lower the operating costs. Today, our energy bills have dropped to around 10 percent of our costs. However, with growing pressure to protect the environment, we need to continue building on this success.
We are currently on track to meet our goal to reduce CO2 emissions by a fifth by 2023.
Four principles guide our approach to sustainability
1. Recycling maximised.
Stainless steel is 100% recyclable, the process of recycling preserves its unique qualities – and the industry can do more to take advantage of these facts. Manufacturers should therefore endeavour to reuse material wherever they can – and conserve raw materials in order to minimise their ecological impact.
2. Nothing to hide.
Making sure that responsibility and transparency are embedded into our manufacturing processes is critical to us, and we make sure we have nothing to hide. It’s also important that the suppliers and contractors we work with have nothing to hide. By holding them to high standards of visible sustainability, businesses can extend the benefits of their approach far beyond their own organisations.
3. Pays for itself.
The best commercial argument for stainless steel is that, over time, it pays for itself: it’s highly strong and durable, it’s resistant to corrosion, and it’s not especially heavy. Manufacturers should therefore make sure that their steel is as long-lasting, cost-efficient, and sustainable as possible.
Wherever viable, manufacturers should become an indispensable contributor to industries that make a positive ecological impact. At Outokumpu, we do this by providing steel to biofuel, wind energy, green construction, and low-carbon transportation companies – among others.
By adopting eco-friendly principles and eco-friendly measures, steel manufacturers won’t just foster sustainability across their companies: they’ll create positive effects that ripple out across other businesses and other industries.
Here’s how Outokumpu is doing just that.
Sustainability in action
Establishing the set of EPDs is the latest step in a long journey of sustainability for Outokumpu that started in 1975. We recognized then that sustainability made sense for the bottom line and we have developed our own sustainability strategies to align closely with the United Nations sustainable development goals.
According to the World Steel Association, energy can account for 20-40 percent of the cost of steel. However, it need not be that high and we’ve found that the greater the energy efficiency, the lower the operating costs. Today, our energy bills have dropped to around 10 percent of our costs.
However, with growing pressure to protect the environment, we need to continue building on this success. We are currently on track to meet our goal to reduce CO2 emissions by a fifth by 2023.
Outokumpu orients our entire business around the circular economy: our 2018 sustainability report revealed that according to ISO 14021, our recycled content accounts for more than 85% of our production compared to 35% for steel makers globally and 78% for stainless steel in the western world. It’s the highest proportion of recycled material on the market. We go as far as to recover metals from dust created in the production process – and to recycle other key materials such as water, acids, gases, and slag formers.
The latter can be particularly environmentally damaging, and as significant amounts of slag is produced annually it is particularly important to reuse wherever possible. In 2018, we were able to reuse 88.1% of all slag produced: a figure which helped us lower our carbon emissions and minimise our contribution to landfills.
Outokumpu makes energy efficiency an ethical, operational, and commercial priority – targeting a company-wide improvement of 1% every year. We’ve worked hard to organise our production sites in a way that maximises international capacity utilisation and heat recovery across the entire supply chain. Steel production is an inherently energy-intensive process – so we focus on where we can make significant efficiency gains. The integrated ferrochromium and steelmaking site which is unique to Outokumpu offers substantial improvements: our Kemi-Tornio site, which has an overall goal of reducing its energy consumption by 2%, has found some success with recovering and reusing carbon monoxide gas from ferrochrome production. Some process gases are even used to heat buildings on-site.
Nothing is more important to us than the safety and wellbeing of employees, contractors, and visitors: they have the right to a healthy, happy environment, and we’re working towards an ultimate goal of zero annual accidents. In 2017, we established ten group-wide Cardinal Safety Rules to protect everyone who might set foot on one of our sites. As part of building a positive and preventive safety culture, Outokumpu launched a global Safety Awards program at the end of 2018. We also hold a yearly Safety Week, and our CEO hosts monthly safety calls to share best practices and discuss any incidents that have occurred over the past four weeks.
But wellbeing is about so much more than just avoiding incidents and accidents. Examinations and preventive checks are available to employees every three years, and in Sweden, we offer voluntary blood pressure, blood sugar and fitness checks. Our US team recently arranged free cancer screenings for employees – and conducts audiometric testing and hearing conservation training for all employees who work in areas that exceed certain decibel thresholds as a matter of course. Outokumpu also provided flu immunisation across multiple sites and mental health awareness was promoted as part of a first-line manager training program, which covered topics such as how to approach and support mental health concerns.
Creating sustainable success stories
Crucially, Outokumpu’s efforts are already bearing fruit and mitigating the most significant environmental consequences of steel production – for example, in 2017, our dust filtering systems caught 99% of all particles. Though none of our sites have been found to negatively local wildlife, we’ve also identified several sites with high biodiversity value, and are actively monitoring them to make sure they remain as undisturbed as possible.
These company-wide efforts have also been augmented by several smaller initiatives. The International Stainless Steel Forum (ISSF) recognized Outokumpu with the 2018 gold-level Sustainability Award for applying a pelletizing method in our Sheffield melt shop in the UK to increase material efficiency and reduce environmental impact in the stainless steel melting process. Outokumpu was also awarded in the categories of New Technolo¬gies and Safety. We also received a silver medal in the New Technology category for the weldable sandwich with a 3D profiled core and a bronze medal in the Safety category for its 24/7 safety awareness training efforts. In Sweden, Outokumpu is participating in an electric road project designed to reduce transport emission.