Wienerberger Sustainability Update 2017 Wienerberger Sustainability Update 2017

Building the Future

Building the Future

Cities are the future.
Innovative building material and infrastructure solutions that are efficient, durable and affordable make cities worth living in and go easy on the environment. These solutions are designed and produced by people with visions, passion and a sense of responsibility in a company that is committed to the goals of sustainability and inspired by its values in all its operations. This is the key to Wienerberger‘s success.

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Essentials 2017

Indicators from the Wienerberger Group 2017 compared to the previous year:

Quantitative targets and our performance 2017

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Introduction by the Chief Executive Officer

Heimo Scheuch
Heimo Scheuch Chief Executive Officer Wienerberger AG

Ladies and Gentlemen,

2017 was a successful year for the Wienerberger Group: We generated record revenues of over € 3.1 billion and a net profit of € 123 million, while our net debt was reduced by 10%. At the same time, we achieved substantial progress in the implementation of our Sustainability Roadmap 2020. This goes to show that a company committed to the principles of sustainability is able to improve its performance and enhance its enterprise value, not despite this commitment but because of it.

We are in the midst of implementing the Wienerberger Sustainability Roadmap 2020 in order to continuously improve our ecological, social and societal performance.

Wienerberger’s 2017 Annual Report takes stock of our achievements in financial terms and offers an outlook on upcoming developments, always with a special focus on our shareholders’ interests. Non-financial aspects and indicators are presented in aggregated form. The Wienerberger Sustainability Report, published for 2017 as a Sustainability Update, is targeted at our many other stakeholders, above all our employees, customers and suppliers, and presents our financial and, in particular, our non-financial achievements as well as the impact of the Wienerberger Group’s activities on society, as required by the Global Reporting Initiative (GRI). It is our intention to present a transparent and coherent view of how we pursue our mission, which is to improve people’s quality of life by supplying sustainable building material and infrastructure solutions of outstanding quality. In order to come increasingly closer to our vision of being the most highly regarded producer of building material and infrastructure solutions and the preferred employer in our markets, we are striving for continuous self-improvement. By presenting our management approach, we provide clear insights into our high-quality corporate governance, our strategy and the future orientation of our company.

As the technology and innovation leader of our sector, the Wienerberger Group is aware of its heavy responsibility for the improvement of living conditions on Planet Earth. The Sustainable Development Goals of the United Nations (17 SDGs) are the yardstick against which policy-makers as well as global players like ourselves have to measure their performance. Wienerberger is directly concerned with several of these goals, be it promoting decent work (SDG 8), building resilient infrastructure and fostering innovation (SDG 9), making cities inclusive, safe, resilient and sustainable (SDG 11), ensuring sustainable consumption and production patterns (SDG 12) or taking action to combat climate change and its impacts (SDG 13).

In our two main product groups, we are aiming at a 20% reduction in specific energy consumption by 2020 compared to 2010.

We are well on track, as shown by our contributions to ensuring sustainable consumption and production patterns (SDG 12) and to combating climate change (SDG 13). In absolute terms, our consumption of energy increased in 2017 over the value reported in 2016, partly as a result of higher production volumes, but energy consumption by ton of products produced (specific energy consumption) decreased by another 0.8% Group-wide and by 1.7% in ceramic production. For our two main product groups (bricks and tiles, plastic pipes) we are aiming at a 20% reduction in specific energy consumption by 2020 compared to 2010. At the same time, we are accelerating our conversion to climate-friendlier energy sources. In 2017, for instance, our specific CO2 emissions from ceramic production were reduced by a satisfactory 2.3% from the previous year’s level. Our North America Division fully met its target of completely converting all main production sites from coal to natural gas.

With digitally assisted design processes and construction methods, including products with high thermal insulation properties, we make it easier for our customers to meet the requirements of energy efficiency in building construction (SDG 13). Another objective is to make cities safer, more resilient and more sustainable (SDG 11). Our second-generation Raineo Stormbox is ideally suited to solve the problems caused by heavy rainfall; it collects, cleans and stores rainwater for later reuse, which is an extremely efficient way of preventing flash flooding in urban areas.

Research and development (R&D) are among the priorities of Wienerberger’s strategic planning. The most essential tasks of R&D include the optimization of production processes (SDG 12) and the development of innovative products and system solutions for a resilient infrastructure (SGD 9). In 2017, our R&D expenditure came to approx. € 11 million. At Group level, innovative products accounted for almost 30% of total revenues. We will continue working on future-oriented solutions by placing a special focus on the digitalization of processes in all business areas and the step-by-step introduction of Industry 4.0 in production. Our aim is to optimize all processes, ranging from production planning to sales and administration. With this in mind, we have set up an innovation lab within the company, which enables us to establish structured contacts with start-ups. At the end of 2017, we organized an open call for innovation, followed by an Innovation Day in January 2018, which provided a platform for lively exchanges with numerous representatives of start-ups.

Innovative solutions are also required in the context of continuing urbanization. According to a UN study, two thirds of the world population will be living in cities by 2050, but hardly any of these cities will have been designed on a drawing board or computer. A major effort will therefore be to redesign the inhumane suburbs of many European metropolises – not to mention cities outside Europe – to make these places attractive again for people to live in. In our role as technology and innovation leader, we will do our utmost to develop innovative solutions, always bearing in mind that we have to cover the “luxury” segment and, at the same time, provide acceptable and affordable social housing.

This takes me to another issue of special importance to me: I cannot overemphasize the key role our employees play in the successful further development of our company. Therefore, it is important to us that our employees worldwide live our corporate values regardless of nation, gender, age, etc. It is our vision to be the preferred employer in every region in which we operate.

Compared to the previous year, the frequency of accidents within the Wienerberger Group was significantly reduced by another 16.8% in 2017.

In 2017, the Wienerberger Group employed a work-force of more than 16,000 people. By ensuring that our employees are fairly remunerated at all our production sites, we contribute to their social security. As an industrial producer, the occupational safety and health of all our employees is an absolute priority for us. It is our goal to reduce the number of occupational accidents throughout the Group to zero every year. We are happy to report that the frequency of accidents within the Wienerberger Group was reduced by another 16.8% in 2017, while the severity of accidents went down by 2.1% compared to 2016. To our deepest regret and despite all our efforts, two fatal occupational accidents occurred in 2017. We studied the circumstances of the accidents in great depth in order to derive targeted measures aimed at further improving occupational safety in our plants. We continue to pursue our “zero accident” target.

We regard our corporate values – expertise, passion, integrity and respect, customer orientation, entrepreneurship, quality and responsibility – as the driving forces that encourage our employees to develop their potential to the full. The fundamental prerequisites are employee motivation and satisfaction, as well as a culture of trust within the company. In the course of 2018, we will roll out the employee survey to all country organizations of the Wienerberger Group and subsequently take the necessary measures to further improve the level of employee satisfaction.

In the near future, we will apply a Group-wide “Supplier Code of Conduct”.

Another challenge faced by Wienerberger is the growing globalization of supply chains. We are expected not only to guarantee the quality of our finished products, but also to guarantee compliance with social and ecological minimum standards of the raw materials, products and services we need to produce and market our products.

By signing the UN Global Compact in 2003, we committed ourselves to ensuring that its ten principles regarding human rights, occupational health and safety, environmental protection and the fight against corruption are observed not only within our own sphere of control, but also along our supply chains. We actively promote an ethical approach in all our entrepreneurial actions and therefore are increasingly adopting supplier guidelines that oblige our suppliers to comply with social and ethical minimum standards. In the near future, we will apply a Group-wide “Supplier Code of Conduct”. Please refer to PDF pages 90 to 94 for our 2017 Communication on Progress on the UN Global Compact.

We intend to consistently pursue our course in the years to come and take all the measures necessary to attain our goals. I am confident that you, our esteemed readers, will accompany us on our way.

Heimo Scheuch

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Management Approach

Management Approach

Wienerberger is determined to provide an appropriate and well-balanced insight into the essential issues addressed by our group of companies and the related effects. We also want to disclose information about how we manage these effects at Group level and in our Business Units.

We therefore decided to focus our report above all on those issues that are of material importance not only for Wienerberger, but also for our stakeholders. This approach meets the requirements of the GRI G4 Reporting Guidelines which we follow in our reporting. For a comprehensive presentation of our management approach, please refer to page 16 of our 2016 Sustainability Report. This chapter comprises three parts:

  • Our Management approach: Presentation of our management approach for the individual topics and the way we pursue our economic, ecological, social and societal targets

  • Our 2014 materiality analysis: Presentation of the issues and aspects classified as material by our stakeholders

  • Our Sustainability Roadmap 2020: A self-imposed commitment to continuously improve Wienerberger’s ecological, social, societal and economic performance

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Employees

Employees

Principles, Processes and Instruments

Our employees are the basis of our success and a key factor for the successful development of our company.

It is our task to create the necessary basis and the best possible conditions for the safety, health and satisfaction of our employees. To this end, we are making every effort to achieve continuous improvements in the fields of occupational health and safety, diversity and equal opportunities, and initial and further training.

A culture of open communication in our company, the consistent involvement of our employees, and a motivating working environment are essential in this context. Our values provide the basis for our entrepreneurial actions. In particular, responsibility, integrity and respect govern Wienerberger’s relationship with its employees.

Results of our 2014 Materiality Analysis

The results of our materiality analysis on social aspects relating to our employees are described on page 40 of our 2016 Sustainability Report.

The results of our materiality analyses provide the basis for our five-year plan of action, the Wienerberger Sustainability Roadmap 2020. The employee-related targets and measures within the framework of the Wienerberger Sustainability Roadmap 2020 are summarized at the end of this chapter under “Targets and Measures Relating to Employees”.

Further Contents of Chapter

  • Collection of Indicators
  • Employment Trends
  • Occupational Safety and Health
  • Communication and Employee Involvement
  • Initial and Further Training and Human Resources Development
  • Diversity and Equal Opportunities
  • Targets and Measures Relating to our Employees

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Production

Production

Principles, Processes and Instruments

Production in harmony with the environment is a matter of great importance for Wienerberger. For us, the conservation of resources is a key aspect in production. In particular, we focus on the responsible use of raw materials, energy and water.

We constantly work on contributing to the fight against climate change through greater energy efficiency and the reduction of our CO2 emissions. At the same time, we strive to increase the amount of recycled material used in all business units, provided this is technically and economically feasible.

Research and development (R&D) are among the priorities of Wienerberger’s strategic planning. One of the core activities of R&D is to optimize production processes and to develop innovative products and services (see chapter “Products” from PDF page 74). R&D expenditure in 2017 amounted to € 11 million, which corresponds to 0.4% of the Group’s revenues.

Environmentally relevant aspects have also been integrated into the company’s quality management systems (QMS), which are certified according to ISO 9001 at almost all our production sites. Where appropriate, some production sites have also been certified according to ISO 14001 (Environmental Management Systems). Moreover, all Steinzeug-Keramo production sites and the Pipelife site in Germany have already been certified according to DIN EN ISO 50001:2011 (Energy Management Systems).

Technical controlling systems have been installed in all production areas of the Wienerberger Group. These systems record all production-related data required for the management of the company and permit the internal benchmarking of production sites against one another.

Results of our 2014 Materiality Analysis

The results of our materiality analysis on environmental aspects in production and on our supply chains are outlined on page 58 of our 2016 Sustainability Report.

The results of our materiality analysis provide the basis for our five-year plan of action, the Wienerberger Sustainability Roadmap 2020. The production-related targets and measures of the Wienerberger Sustainability Roadmap 2020 are summarized at the end of this chapter under “Targets and Measures Relating to Production”.

Further Contents of Chapter

  • Principles, Processes and Instruments
  • Results of our 2014 Materiality Analysis
  • Collection of Indicators, Restatements
  • Volumes Sold by Product Group
  • Environmental Aspects in Production: Energy Efficiency
  • Environmental Aspects in Production: Climate Protection
    and CO2 Emissions
  • Environmental Aspects in Production: Resource Efficiency
    and Waste Management
  • Environmental Aspects in Production: Sparing Use of Water
  • Targets and Measures Relating to Production

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Products

Products

Principles, Processes and Instruments

A central principle of product development at Wienerberger is the creation of lasting value for our customers by supplying them with durable and innovative building material and infrastructure solutions.

Wienerberger brick products are an integral part of sustainable building concepts. They guarantee a high quality of life and make an active contribution to the fight against climate change, not least on account of their heat storage capacity.

In the field of pipes and pavers, we offer system solutions for all present-day challenges, including the demands on water management resulting from climate change and increasing urbanization. Durability and innovative strength are quality criteria which we regard as particularly important across all product groups.

In view of what users and developers expect of a modern building, and considering the numerous regulatory requirements to be met, such as the Energy Performance of Buildings Directive (EPBD), a system based approach to building construction is getting more and more important. Integrated system solutions enable us to combine the outstanding properties of individual products of the Wienerberger product portfolio with products supplied by our partners in the field of building services and facilities in order to obtain the best possible results.

Wienerberger aims to secure and further strengthen its market positions through cost and technology leadership and product innovations. Therefore, research and development (R&D) are among the priorities of Wienerberger’s strategic planning.

For many years, Wienerberger has been working intensively on the voluntary preparation of eco-balances and environmental product declarations (EPDs) for its entire product range. For several years, all ceramic pipes and fittings produced by Steinzeug-Keramo as well as selected Semmelrock product lines have been certified according to the Cradle to Cradle® concept.

Results of our 2014 Materiality Analysis

The results of our materiality analysis in respect of our products, from raw material procurement to their useful life and their end-of-life disposal, are outlined on page 80 of our 2016 Sustainability Report.

The results of our materiality analysis provide the basis for our five-year plan of action, the Wienerberger Sustainability Roadmap 2020. The product-related targets and measures provided for within the framework of the Wienerberger Sustainability Roadmap 2020 are outlined at the end of this chapter under “Targets and Measures relating to Products”.

Further Contents of Chapter

  • Innovative Products
  • Targets and Measures Relating to Products

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Social and
Societal Commitment

Social and
Societal Commitment

Principles

Wienerberger views the economy as an integral part of society that has the obligation to serve people and create value for all. Wienerberger takes its role as a responsible member of society very seriously. For us, this responsibility encompasses the observance of ethical principles in all our actions, honest communication, active involvement in the creation of a transparent economic environment, personal accountability for what we do, and acting as a reliable and useful member of society.

Results of our 2014 Materiality Analysis

In the course of a differentiated analysis of the impact of our various fields of production on society, business ethics and compliance were identified as aspects of material importance that are equally relevant to all operating segments. Details relating to these issues are contained in the chapter “Management Approach”, which also outlines our quantitative targets and the corresponding measures.

Further Contents of Chapter

  • Social Commitment and Donation Activities

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About this Report

Reporting Profile

Wienerberger reports once a year on the Group’s sustainable development indicators. In accordance with past practice, a full Sustainability Report is published every two years, which alternates with a concise update presenting the most essential facts and figures for the year between. The last full Sustainability Report for 2016 was published in June 2017. The 2018 Sustainability Report will be published according to schedule in June 2019.

This Sustainability Update covers Wienerberger’s activities in 2017. The indicators shown also refer to the years 2015 and 2016 and thus reflect a three-year trend. The report focuses on the ecological, social and societal aspects of Wienerberger’s activities and their impact on society. For more detailed information on Wienerberger’s economic performance, its organizational profile and its corporate governance structure, please refer to the 2017 Annual Report, which is available online at

annualreportwb.com/de/ | annualreportwb.com/en/

This report covers the fully consolidated subsidiaries of the Group with operations in the wall, roof, facade, ceramic pipe, plastic pipe and concrete paver product groups. A list of all companies covered by the consolidated financial statements is contained in the 2017 Annual Report of Wienerberger. Sustainability reporting follows the scope of consolidation of the Wienerberger Group. For details on the scope of consolidation and the segmentation of the Wienerberger Group, please refer to Wienerberger’s 2017 Annual Report.

The data presented in the chapter “Production” only refer to our production sites, whereas all other data include all sites of the Wienerberger Group. Deviations from the reporting scope are indicated in the respective sections.

The topics and key indicators presented in the report are based on the materiality analysis performed in 2014 and were elaborated by subject-specific working groups in cooperation with the Corporate Sustainability Officer. The decision on the selection of topics was taken by the Wienerberger Sustainability Steering Committee (SSC).

The 2017 Sustainability Update was prepared in accordance with the G4 guidelines of the Global Reporting Initiative (GRI), “core” option.

The data presented in this Sustainability Update are based primarily on internal statistics. Important topics were validated by an independent external auditor. In the year under review, the audit focused on facts and figures regarding occupational safety, health, employee turnover, energy consumption and emissions. The audit also covered the underlying sustainability management system and the processes employed to collect data and to implement the sustainability strategy.

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UN Global Compact:
Communication on Progress 2017

The activities of big industrial companies, such as Wienerberger AG, have a strong impact on society and the environment. Such companies therefore bear a special responsibility and should act in an exemplary manner. The minimum standards to be complied with include, above all, the principles of the UN Global Compact regarding human rights, labor standards, environmental protection and the fight against corruption. Through its accession to the UN Global Compact in 2003, Wienerberger officially committed to the ten principles and undertook to foster their implementation within the framework of the company’s possibilities. Once a year, we report on progress achieved in this respect.

The 2017 Communication on Progress in respect of the Global Compact forms part of our 2017 Sustainability Update. In order to ensure maximum transparency and to make it easier for our readers to find the individual examples, we have aggregated the most important statements on the ten principles and, in addition, marked the corresponding indicators in the GRI Index and added references to the pages concerned.

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Mission Statement

Mission Statement

Our Vision

We want to be the most highly regarded producer of building materials and infrastructure solutions and the preferred employer in our markets. We share our values, our knowledge, our experience and our success.

Our Mission

We improve people’s quality of life by providing outstanding, sustainable building material and infrastructure solutions.

Our Goal

The primary goal of our entrepreneurial activities is to achieve a sustainable increase in the value of the company in accordance with ecological, social and economic principles.

Our Values

Expertise – Passion – Integrity and Respect – Customer Orientation – Entrepreneurship – Quality – Responsibility

Our values form the basis of our entrepreneurial activities. We live by our values and share them in our day-to-day cooperation.

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Building the Future

Annual Report 2017

If you want to know more about the indicators of Wienerberger please click here:

annualreportwb.com

Download 2017 Sustainability Update