Vapo Group s Sustainability Report 2020 - Sustainable Everyday Living
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Vapo Group´s Sustainability Report 2020 Sustainable Everyday Living S USTAINABILIT Y RE P O RT 2020 1
Sustainability highlights 2020
Nevel´s share of renewable
energy increased In Ostrobothnia
from 54% (2019) According to the lifecycle assessment,
Finland, at the Teuva
composting plant
to 67% (2020) the carbon footprint of Novactor’s
activated carbon from Ilomantsi plant is Kekkilä-BVB started to offer
Kekkilä-BVB invested
in own coir production
line in the Netherlands
one-third
greenhouse growers and we save between
of the carbon footprint of activated
circular economy
solutions.
10–30%
on water consumption
carbon produced from coal. compared to suppliers.
In occupational safety, a significant The State of Finland
Air emissions for our
improvement took place in the
Netherlands, where the accident 97% own operations in Fin- bought from Vapo Oy
frequency rate dropped by of all employees
land were 832 kilo-
tonnes CO2-eq, and
over 1,000
40%
completed our hectares of mire
internal Safety First! reduced areas of high nature
e-learning course, by 18% value for enhancing
The most advanced Vapo and in addition, biodiversity.
from 2018 level.
Refinery project boosting
circular economy was 87%
Biostimulants, of all operations
which proceeded as planned employees received
together with the customers external safety
and ecosystems. training.
In the Netherlands we Great Place to Work In 2021 sustainability Vapo Oy donated
already produce survey, our employee is part of the short- and sold almost
25%
of our electricity
experience Trust Index
was 68% ,
term incentive target
in all countries, and
400 hectares
cutaway areas in Finland
consumption through solar up 5 percentage in all levels of the to be planted as carbons
panels on our own roofs. points from 2019. organization. sinks by 4 H foundation.
S USTAINABILIT Y RE P O RT 2020 2 S U S TA INA B IL IT Y H IGH L IGH T S 2 0 2 0
Content
2 Sustainability highlights 2020 18 Kekkilä-BVB – Growing together for a better future
20 Our sustainability focus areas
4 Vapo Group and business locations
20 Achievements in 2020
5 CEO’s review 20 Focus area: Flourishing people
20 Focus area: Sustainable food and living
7 Sustainability at Vapo Group
21 Focus area: Green growth and recycling
8 Focus areas are in line with our stakeholder expectations
22 Focus area: Biodiversity and restoration
9 Sustainability tightly governed within Vapo Group
9 Stakeholder engagement is vital 23 Nevel – Taking utility infrastructure to the next level by optimising
9 Key updates to our management approach during 2020 energy production and investing in renewable energy
23 Achievements in 2020
10 We take care of the environment
10 Aiming towards a carbon neutral society 25 Fuels – Ensuring fuels availability and security
11 Minimizing impacts on water sources of supply for customers
12 Supporting biodiversity 25 Achievements in 2020
13 Boosting circular economy 25 Supporting customers in transformation from fossil fuels
to biofuels with a controlled change
14 We take care of the wellbeing of our employees
14 Safety First! 27 New Businesses – High value-added products
14 Engagement and wellbeing of our employees for sustainable everyday living
15 Competence development 27 Achievements in 2020
27 Boost to the circular economy through R&D program
16 We contribute to the benefit of the society
16 Financial implications and climate risks related to peat 30 GRI Index
17 Sustainability with our suppliers and contractors
38 Appendices
S USTAINABILIT Y RE P O RT 2020 3 C ONT ENT
Vapo Group and business locations
Vapo Group
ENERGY GROW&CARE NEW BUSINESSES
Nevel* Kekkilä-BVB Vapo Ventures
Vapo Fuels G&C Materials Oy Novactor
Supply Chain Management
Group Services
*Vapo Group has sold Nevel Oy
to Ardian.The transaction was
completed on January 28, 2021.
Business locations
Head office
Australia China USA Mexico
S USTAINABILIT Y RE P O RT 2020 4 VA PO GR OU P A ND B U S INES S L OC AT IONS
CEO’s review
Challenging operating In-house product development of Satisfactory result in a difficult During 2019 and 2020 we have suc-
environment in 2020 new, innovative products has pro- operating environment cessfully executed a cost efficiency
gressed according to plan. At pre- program by improving the efficiency
Year 2020 was very unpredictable to sent, Vapo Group’s first activated Vapo Group turnover grew slightly of our operations over EUR 30 mil-
everyone. The most significant hap- carbon production facility in Ilo- year-on-year, totalling EUR 544.9 lion. Because of the fast-declining
pening in 2020 was by far the onset mantsi, Finland is starting commer- (533.7) million. The very positive energy peat demand, we launched a
of the deadly pandemic COVID-19. It cial production in 2021, under our business development of the new cost saving program with target
influenced everyone, including us. Novactor brand. It is capable of pro- Grow&Care division enabled the to reduce our fixed cost by appx EUR
ducing activated carbon from peat growth in turnover. In particular, 25 million in the next 2–3 years. This
Vapo Group immediately imple- and other biomasses to be used for Kekkilä-BVB’s Retail business unfortunately also led to the need to
mented the processes and controls to example in water and air purifica- focusing on hobby gardeners saw reduce our personnel cost with maxi-
minimize the risks to our employees tion. It is the most modern in its intense growth. Early spring and mum 25 persons. However, owing to
while maintaining security of supply field in Europe. the COVID-19 pandemic, boosted relocation, voluntary financial sup-
to our customers. Since March 2020 the growth of the gardening sector port packages and attrition, the final
our special focus has been on the Change in the operating considerably. number of dismissals was five.
health and safety of our employees. environment required
a revision of strategy Vapo Group’s comparable EBITDA Making progress in our
Strategy execution was almost equal to that of the pre- sustainability focus areas
progressing and under The fivefold increase in the price of vious year, despite the energy peat’s at Vapo Group
continuous development emission rights in three years, and the over 25% decline in both turnover
political decision to double the tax on and EBITDA. Sustainability is at the heart of Vapo
Vapo Group has successfully imple- energy peat in Finland resulted in an Group’s strategy. We have shared val-
mented its strategy in the global unparalleled decline in energy peat Profitability enables us to be ues and a shared purpose, crystal-
growing media market. Following an demand in 2020. Due to this rapid a responsible company lised as Sustainable Everyday Living.
acquisition carried out in early 2019, change in the operating environment, The long-term sustainability target
Kekkilä-BVB is now the largest player we decided to review our strategy, The primary responsibility of compa- for Vapo Group is to be net positive
in Europe in the substrates market tar- and as the result Nevel Oy was sold nies is to ensure profitability in the in its operations and in the use of
geted at professional growers. Kekkilä- to Ardian. The arrangement strength- long-term. This was the reason for our product and services. This means
BVB’s turnover in 2020 was approxi- ened our balance sheet and freed up our strategic arrangement regarding that we evaluate our overall impact
mately EUR 300 million and we con- resources for profitable growth in our Nevel. It enables us to make responsi- on environment, health, society and
tinue to have ambition for growth. other business areas. ble investments in the future. knowledge and, in this assessment,
S USTAINABILIT Y RE P O RT 2020 5 C EO’S R EVIEW
the positive impacts must exceed the The most significant goals related to Kekkilä-BVB’s operations and product
negative impacts. employee well-being are the zero acci- development are guided by the prin-
dents target and the policy of zero tol- ciple of minimising environmental
Vapo Group currently has two main erance for all discrimination and inap- impacts and maximising the positive
focus areas for sustainability: to take propriate conduct. During the year, we impacts from the use of its end prod-
care of the environment and to take succeeded particularly well in improv- ucts, whether this involves food pro-
care of the well-being of its employees. ing our placement in the international duction, creating more pleasant envi-
Great Place to Work listing. Employees’ ronments or conserving water.
Our environmental sustainability trust index in the company improved
related targets are measured in terms from 63% in the previous year to 68%. In the New Business division, sustain-
of our progress towards carbon neu- This provides an excellent basis on our ability is also an essential element of
trality (CO2 emissions), the way our journey towards being one of the best all innovation activities. No idea or
operations support biodiversity and places to work in Europe. initiative can proceed to the project
sustainable use of natural resources. stage unless it meets strict responsi-
Also, we continue to mitigate our Sustainability guides bility and sustainability criteria. The
impact on waterways and to pro- investments aim is always to produce new higher
mote water-conserving solutions in value-added products as sustaina-
products and services. Our ability to Sustainable business is a competi- bly and energy-efficiently as possible,
impact on circular economy is moni- tive asset for companies. With this with low emissions, and for the prod-
tored through increasing material effi- in mind, Vapo Group is focused on ucts to make daily life easier for peo-
ciency, recycling and the use of recy- shifting also the emphasis of product ple. Vapo Group aims to continue
cled materials. development towards that goal. The investments in the development and
aim is to make new use of our land production of activated carbon as well
In spring 2020, Vapo Group set an assets by investigating opportuni- as other value-added products.
ambitious target of halving the carbon ties for obtaining permits that would
dioxide emissions of its Finnish opera- allow areas released from peat pro- In this report we want to show that
tions by the year 2025. Our total emis- duction to be used for zero-emission Sustainability is and will be at the
sions in 2018 were approximately 1.2 energy production or carbon seques- heart of Vapo Group’s strategy. Enjoy
million tonnes, of which the Finnish tration. In 2020 we made excellent reading the progress in executing our
operations produced approximately progress in charting the opportunities sustainability strategy together with
one million tonnes. In 2020 our CO2 for obtaining permits for wind farms some exciting sustainability cases!
emissions in Finland reduced by 18% on our real estate land in Finland. We
(vs. 2018) and we believe we can have half a dozen projects that we
reach the CO2 emissions reduction tar- now move forward with both on our Vesa Tempakka
get before the year 2025. own as well as with chosen partners. CEO, Vapo Group
S USTAINABILIT Y RE P O RT 2020 6 C EO’S R EVIEW
Sustainability at Vapo Group
Sustainability aim, SUSTAINABILITY AIM: TO MAKE VAPO GROUP A NET POSITIVE COMPANY
objectives and long-term
goals guiding the work
in Vapo Group. Objectives – now! Long-term goals
Sustainability is in the core of Vapo
Group’s strategy and purpose - Sus-
tainable Everyday living. Work on
the environment
We take care of
sustainability has been under con-
tinuous development through- Aiming Supporting Boosting circular Minimizing 50 % reduction Zero waste
out 2020 and is integral part of the towards biodiversity economy by harmful impacts in CO2 emissions by 2030
a carbon and using increased material to water sources in our own
development of Vapo Group’s busi- neutral natural efficiency, efficient and enhancing operations
society resources recycling and water-use by 2025
nesses. sustainably utilizing recycled efficiency
materials
Vapo Group sustainability objectives
and long-term goals focus on two
0
areas: we take care of the environ-
the wellbeing of
We take care of
our employees
ment and we take care of the wellbe-
ing of our employees. Sustainability
strategies and roadmaps are in place
Zero accidents Zero tolerance against Most inspiring/attractive workplace
and systematically executed for each (health and safety first!) discrimination and (Great Place To Work top quartile
inappropriate behavior in Europe) by 2030
business in line with customer needs
and guided also by the UN Sustaina-
ble Development Goals.
Our sustainability aim is to make us
a net positive company by consid- Kekkilä-BVB Nevel Vapo Fuels New Businesses
ering the impact of our operations,
products and services on environ-
ment, health, society, and knowl-
edge.
S USTAINABILIT Y RE P O RT 2020 7 S U S TA INA B IL IT Y AT VA PO GR OU P
Focus areas are in line with ence our approach to managing our est of all our key stakeholders cover- In Finland an intensive discussion
our stakeholder expectations impacts, our target setting and the ing Group stakeholders (owners, par- and debate on the future of energy
content and structure of our report- liamentarians, cities, NGOs, media, peat has taken place throughout the
Our sustainability objectives and ing. authorities and contractors) and busi- year. In this discussion the impor-
focus areas are aligned with the mate- ness specific customers (Vapo Ener- tance of security of supply and finan-
riality assessment that was conducted The environmental topics (especially gy’s clients, Kekkilä-BVB retail and cial and social impact on the peat
at the end of 2019. The insights from low carbon transition and biodiver- professional customers and Novactor industry have been emphasized.
the materiality analysis strongly influ- sity) continue to be the main inter- stakeholders).
MATERIALITY MATRIX
Top material topics
Content of other topics
Development of sustainable 2. 50% reduction in CO2 emissions
HIgh
Supporting transition towards harvesting methods and returning in own energy use
a carbon neutral society peat bogs into natural state
3. Net positive impact of new and
growing media products
15
Importance to external stakeholders
6. Boosting circular economy by increased
1 5 material efficiency, efficient recycling
16 4 and utilizing recycled materials
9 3 7. Zero waste (long-term)
13 Minimizing harmful impacts
Supporting biodiversity to water sources and enhancing 8. Zero accidents
8 water-use efficiency
6 and using natural 9. Zero tolerance against discrimination
resources sustainably and inapproriate behavior
2 10 10. Most inspiring /attractive workplace
11. Smart service concepts for living
12 14 and food production
12. Optimisation of water use
13. Decreasing use and recycling of plastics
11
Medium*
7 14. Improving wellbeing of employees,
clients and partners
16. Transparency and understanding
Low Significance of impacts on environment, economy and society High of sustainability impacts
*Note the scale on the vertical axis, importance for all presented topics is between medium to high.
S USTAINABILIT Y RE P O RT 2020 8 S U S TA INA B IL IT Y AT VA PO GR OU P
Sustainability tightly ness specific sustainability roadmaps. mentation is regularly followed-up by Continuous dialogue, feedback and
governed within Vapo Group The Group Chief Financial Officer the Audit Committee. Sustainability on-going cooperation are the key
is responsible for reporting on eco- report is reviewed and approved by methods for promoting mutual
Sustainability at Vapo Group and nomic responsibility. Vapo Group’s Board of Directors and understanding between stakehold-
the sustainability strategy are led at the Audit Committee. ers and Vapo Group. We aim to
the Group Management Team level The Director, Group Operational build networks with important par-
by the Chief Supply Chain and Sus- Excellence and Sustainability is Stakeholder engagement ties as well as regularly collect and
tainability Officer, with the Direc- responsible for areas related to envi- is vital share information that is relevant to
tor, Group Operational Excellence ronmental sustainability and occupa- the Group’s business and customers.
and Sustainability in charge of coor- tional safety and the Group Chief HR Vapo Group’s stakeholder engage- Feedback from stakeholders is one of
dinating the implementation.Busi- Officer is responsible for areas related ment starts at the local level and the inputs considered in the develop-
ness management is in charge of to employee wellbeing and occupa- extends all the way to international ment of products and services, and
the implementation of the busi- tional health. Sustainability imple- activities across national boundaries. it also influences how the company
operates. We also monitor and evalu-
ate public discussion.
Key updates to our management approach during 2020 The significance of international
cooperation is constantly growing
The foundation for our renewed sustainability work 200 sustainability posts in our social media channels
in response to the internationalisa-
to fulfil our company purpose (Sustainable Everyday as well as over 100 articles in our Vapo Group in-
tion of markets, research, and regula-
Living) was laid during 2019 by creating the new tranet site, and conducted several internal sustaina-
sustainability strategy with clear objectives and long bility information sessions for our employees. tion. Vapo Group companies in var-
term goals, updating our corporate responsibility ious countries are active members of
policy (describes our operating principles in occupa- In the Great Place to Work survey conducted in local and international associations
tional health & safety, environment and quality October 2020 we got an excellent score of 4 (scale (e.g. International Peatland Society
matters) and creating new mandatory e-learnings for 1–5) on our sustainability work to the statement and Growing Media Europe). Interna-
all employees for Code of Conduct, Information “Sustainability (corporate responsibility) is on good tional advocacy work related to the
Security Awareness and Safety First! level in our company’s operations.” This is a recogni- energy and growing media businesses
tion that our employees are engaged in sustainability is focused on EU bodies in Brussels.
2020 has been a year of execution of our sustainabili- work and that they are proud of the direction we
ty plans and communicating the progress in our have set for our sustainability work.
During 2020 stakeholder engagement
sustainability activities extensively both internally and
work has especially focused on the
externally. Last year, we paid special focus in sustaina- To further engage our personnel we decided to
future of energy peat and alternative
bility communication: over 100 external articles were include sustainability in the short-term incentive
uses of peat.
published about us and we ourselves created over target for all employees in 2021.
S USTAINABILIT Y RE P O RT 2020 9 S U S TA INA B IL IT Y AT VA PO GR OU P
We take care of the environment
We are committed to the most significant annual improve-
minimize the harmful ment targets for our operations.
environmental impacts of Our aim is to halve our air emissions
our operations. Overall, management system certifi- for our own operations in Finland
cation, covering both ISO 9001 qual- by end of 2025 from 2018. So far
In 2019 we updated a common Vapo ity and ISO 14001 environment, we have reduced them by18%
Group environment strategy and helps coordinate and direct our activ-
long-term sustainability goals: we will ities to meet customer and regulatory
reduce our emissions to waterways as requirements and focus on continu-
well as our climate emissions, support ously improving our operations, effec- Our long-term target is to be net developing our high value-added
biodiversity and use natural resources tiveness, and efficiency. In addition, positive in our operations. We con- products further.
sustainably, and boost circular econ- we have carefully documented our ducted a net impact assessment
omy through improving material effi- sustainability concept for peat in Fin- using Upright Project model for the During 2020, the number of environ-
ciency and reducing waste. Each of land, Sweden, and Estonia, especially Group’s businesses and will use the mental observations decreased (year-
our businesses has an environmental aimed for our customers and stake- model in the sustainability work car- on-year) due to COVID-19 travel
sustainability program which specifies holders relating to new businesses. ried out at Kekkilä-BVB, and when restrictions, totalling to 753 (cor-
responding figure in 2019: 870) on
Vapo Group level. In 2020, 408 peo-
Key indicator 2020 Target by 2025 ple (38% of all employees) completed
CO2 emissions from our Finland: reduction of 18% (from 2018) Finland: reduction of 50% (from 2018) our internal, new online course on
own operations • 2018: 1.02 Million tonnes CO2-eq. environmental sustainability.
• 2020: 0.83 Million tonnes CO2-eq.
Circularity of plastic Kekkilä-BVB: Kekkilä-BVB: Aiming towards a carbon
packaging materials • Use of recycled plastic in packaging: 17% • Use of recycled packaging materials 80%
• Recyclability of plastic packaging: 100% • 100% of our packaging can be recycled neutral society
Impact on watercourses Finland: amount of water effluents Finland: amount of water effluents Our ambitious target is to halve the
from peat production from 2008 to 2020 from 2008 to 2025
• Solid matter reduction by 68% • Solid matter reduction by 75% carbon dioxide emissions of our oper-
• Nitrogen reduction by 53% • Nitrogen reduction by 75% ations in Finland by the year 2025,
• Phosphorus reduction by 63% • Phosphorus reduction by 75%
without compensation. We are focus-
Zero waste from our Vapo Group waste from our own operations: Vapo Group waste from our own operations: ing on our Finnish operations as in
own operations recovery rate 92%, recycling rate 77% recovery rate 95%, recycling rate 90%
2018 they accounted to over 80% of
S USTAINABILIT Y RE P O RT 2020 10 WE TA KE C A R E OF T H E ENVIR ONM ENTVapo Group’s total emissions. Our • Pilot for an alternative horticultural WATER EFFLUENT IN PEAT HARVESTING (FINLAND):
emissions reduction efforts will focus peat harvesting technique using NITROGEN (TONNES)
700
on: peat mass transfer method, target to
reduce CO2 emissions by 33% per m3 600
638
638
1) Increasing the use of renewable of produced peat. 500
fuels in Nevel energy production: In • Seeking for emission reductions in
459
450
400
428
443
401
2020 67% of the fuels used by Nevel logistics.
375
367
361
300
303
were renewable and by end of 2021,
255
200
228
the corresponding figure will be up Minimizing impacts
100
to 75%. on water sources
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
2) Implementing effective next land Our main target is to reduce solid mat-
use for closed peat production areas: ter, nitrogen and phosphorous effluents WATER EFFLUENT IN PEAT HARVESTING (FINLAND):
Approximately 64% (2019: 57%) of in peat harvesting by 75% in Finland PHOSPORUS (TONNES)
25
Vapo Group’s emissions in Finland are by 2025 (from 2008 levels). We have
23
soil emissions. Although it is expected already made significant progress in the
22
20
20
that the demand in other sectors last ten years. The water treatment sys-
18
than energy peat will increase, we can tems in our peat production in all coun- 15
15
reduce the area used for peat produc- tries are well managed and based on
13
13
10
12
11
11
tion so that our soil emissions will best available techniques (BAT), which
9
account for less than 50% of our total will help us to continuously improve
7
7
5
emissions in five years. Reduction of our performance to protect the water
0
peat soil emissions from 2018 to 2020 sources we and the society rely on. 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
is 51 kilotonnes, i.e. 9% less in years.
Other key actions: WATER EFFLUENT IN PEAT HARVESTING (FINLAND):
SUSPENDED SOLIDS (TONNES)
Other key actions: • Improving water efficiency in all our
4 000
• Conducting life cycle assessment production, with special focus in
3 500
3 656
(LCA) for growing media products reducing water and chemical con-
3 320
3 000
as well as our new peat based acti- sumption in our coir production in
3 002
2 500
2 693
vated carbons product. the Netherlands.
2 344
2 000
2 193
2 117
• Increasing energy efficiency in our • Improving water efficiency and water
1 949
1 923
1 500
1 637
factories and production sites. retention in our growing media
1 340
1 000
1 186
1 175
• Regular evaluation of options to products.
500
increase carbons sinks utilizing our • Developing activated carbon from
0
land assets. peat to purify air and water. 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
0
5
10
15
20
25
S USTAINABILIT Y RE P O RT 2020 11 WE TA KE C A R E OF T H E ENVIR ONM ENTSupporting cial provision for environmental work
biodiversity is made during production.
Natural Resources Institute Finland (Luke)
is carrying out a five-year survey (2020–2024) We aim for responsible peat produc- Regarding sustainability certifications
of the re-growth of Sphagnum moss and tion. Since 2012 Vapo Group has for our peat production areas, the RPP
the re-colonization of other mire vegetation released 5,140 hectares of mires with (responsibly produced peat) certifi-
significant nature value to be man- cations coverage by end of 2020 has
In the survey requested by Vapo Group, the vegetation cover and com- aged by Metsähallitus, a Finnish state- reached 548 hectares. The target cov-
position were measured before Sphagnum moss biomass collecting.
owned enterprise (corresponding fig- erage by end of 2021 in total 3,319
Vegetation succession and the height growth of Sphagnum moss is
ure from 2019: 4,364). Regarding hectares: Finland 677 ha, Estonia
monitored after the collection.
closed peat production land areas, the 2,207 ha, and Sweden 475 ha. Cer-
Due to its characteristics, Sphagnum moss is an excellent renewable topography, hydrology, and rocks/ tification applications for these peat
raw material for substrates. Sphagnum moss biomass is collected into stones influence what the best next areas have already been submitted to
the depth of 30 cm from the mire surface, at maximum. According to land use option is. RPP during 2020.
Luke’s preliminary studies, the rotation period of Sphagnum moss bio-
mass is predicted to be about 30 years, approximately a half of the rota- During 2020, from the peat produc- Other key actions:
tion period of conventional silviculture in Finland. tion areas owned by Vapo Group in • Extending the RPP (Responsibly
Finland, we moved 1,153 hectares Produced Peat) certification for
According to the surveys done in 2020, sites where moss was collected to next land use (corresponding fig- growing media: Kekkilä-BVB target
14 and 11 years ago were completely re-vegetated, thus there are no ure in 2019: 453 hectares): 754 hec- is to achieve 80% RPP certified peat
visible areas without vegetation. Also, the projection cover of Sphagnum tares to afforestation (2019: 356) and volume by 2024.
moss generally was at the same level as before collection. On the nutri-
402 hectares to wetlands (2019: 97). • Enabling growing of food and
ent-poorer site, also the species composition between the Sphagnum
We returned 3,836 hectares of old peat plants in urban environments
moss of drier (hummock species) and wetter growth optimum (lawn
production areas to landowners (2019: through Kekkilä-BVB products.
species) was almost similar to the situation before collecting. On the
slightly nutrient-richer site, lawn species were still more abundant than 1,449), in addition to selling signifi- • Increasing biodiversity in our peat
before collecting. cant areas for which the next land use production areas to reduce the
is determined by the new landowner. impact of our operations to the
According to the results of the survey, Sphagnum moss biomass is prob- To cover the costs of post-production nature by creating small wetlands,
ably possible to re-collect after 30 years rotation period. The mean obligations in old peat areas, a finan- and building nesting or shelter areas.
growth of Sphagnum moss has been clearly more than one cm per
year, at least during the first 11–14 years after collecting. However, it is
uncertain whether the growth of Sphagnum moss continues as fast as In 2020, Vapo sold 1,063 hectares of bogs
in the first years, and how does the humification of the deepest layers of of significant nature value to the government of
the re-grown Sphagnum moss affect. Finland for conservation purposes.
S USTAINABILIT Y RE P O RT 2020 12 WE TA KE C A R E OF T H E ENVIR ONM ENTBoosting circular economy
RPP responsibly produced peat certification almost completed
Our target is to progress towards our for two peat production areas in Estonia
zero-waste by 2030 goal by increas- More and more horticultural peat is constantly needed to The monitoring plan for Lavassaare and Elbu area has
ing material efficiency, utilizing recy- satisfy the demand for food produced nearby. That is why been sent to RPP organization for final approval. Pööravere
cled materials in our operations, and we in Vapo Group want to support the use of RPP respon- production area certification approval is postponed due to
implementing efficient recycling of sibly produced peat raw material as a growing media. changes in area boundaries during a minor environmen-
our waste streams. We are currently tal permit change in 2020 summer. Boundaries have to
focusing on our main waste streams In Estonia we submitted RPP applications for peat produc- be checked again when snow melts. We expect to get the
from our own operations including tion areas Lavassaare and Elbu, total area 2,290 hectares RPP certification completed for these areas in 2021.
recycling ash from our pellet, power and Pööravere, 445 hectares, in the end of 2019. RPP or-
& heating plants as fertilizer or land- ganization carried out the production area assessment in The national legislation of Estonia already requires all the
scaping material as well as increasing summer 2020, site inspection in autumn 2020 and the fi- same criteria as RPP, which made the process smoother.
nal revision round in December 2020. The COVID-19 trav-
the use of recycled packaging mate-
el restrictions raised doubts to whether and in what way Next two RPP areas in Estonia will be Leva and Sooniste
rials in Kekkilä-BVB to 80% by 2025.
we could complete the process, but the RPP management production areas in Harju county, total area 481 hectares.
In peat operations, we continue to
found a good solution in the form of a ”remote audit”. Applications will be submitted during 2021.
focus in recycling the plastics used
to cover the peat stockpiles. During
2020 we disposed for reuse a total of
8,844 tons of old stockpile plastic in Already two or three correctly timed samples yearly
Finland, Sweden, and Estonia: 63% as can give a reliable estimate of the total water load
recycled material and 37% as energy. The Vapo Group has collected comprehensive temporal production water effluents are generated in an average of
and regional data on the use of continuous measuring for 40 days.
Other key actions: water quality and load in peat production in Finland. Data
• Making growing media of com- was utilized in a collaborative study between the Univer- Another significant improvement in the study was the de-
posted waste streams (e.g. grass, sity of Tampere and Vapo to investigate the reliability of velopment of a method utilizing a genetic algorithm to
leaves, vegetable stems). the current manual monitoring method and to develop a optimally determine sampling times so that the estima-
• Piloting new ways to reduce plastic new method for estimating the concentration of suspend- tion of annual emissions is as accurate as possible for a
ed solids for peat areas. The study showed a strong corre- certain annual number of samples. The optimal meas-
waste in peat production as well as
lation between manual and continuous measurement. urement times determined based on the study focus on
packing materials.
spring and autumn when the flows are at their highest.
• The Vapo Refinery R&D program
Therefore, the existing emission monitoring based on
(2020–2022) to speed up the devel- manual sampling is a very reliable way to determine the When site-specific flow measurement is continuous, in most
opment of high value-added prod- annual emissions from peat production. The results of production areas, already 2–3 correctly timed samples can
ucts from organic wetland biomass continuous measurement show that 50% of annual peat give a reliable estimate of the total water load.
and other bio-based raw-materials.
S USTAINABILIT Y RE P O RT 2020 13 WE TA KE C A R E OF T H E ENVIR ONM ENTWe take care of the wellbeing of our employees
We are committed to dents over million working hours)
zero accidents and we have was 7.2, with 7% increase from last
Trust Index, which measures
zero tolerance to inappro- year (2019: 6.7).
our employee experience, is
priate behaviour and
discrimination. A significant improvement took place
in the Netherlands, where the acci-
68%,
and up 5 percentage points
dent frequency rate dropped by 40%.
from 2019 – excellent result!
Our goal is to offer our employ- Most of our accidents, and especially
ees, partners, and visitors a safe, serious accidents, occur in production
healthy working environment by us- operations. Looking at the past three
ing methods that prevent injuries years, 23% of the cases are defined as
and accidents and promote well-be- serious accident or serious near miss
ing at work. accident (19 out of 81). nal safety training. We are also track- Engagement and wellbeing
ing our contractors’ accidents in our of our employees
We aim to influence people’s mind- To improve and harmonize our safety operations, conducting an accident
set so that they consider health and culture, we focused in safety train- investigation together with them. Vapo Group participated in the Great
safety first in everything they do. We ing in 2020. On Group level, 97% of Due to traveling restrictions caused Place to Work personnel survey for the
utilize our working instructions and all operations employees completed by COVID-19, the number of safety second time in 2020. This made the
the competence of our personnel to our internal Safety First! e-learn- observations decreased by 15% (year- comparison possible with the previous
identify and mitigate risks and haz- ing module, and 87% operations on-year), totalling to 3,986 (corre- year’s results. Our Trust index being
ards. employees received additional exter- sponding figure in 2019: 4,709). 68%, went up 5 percentage points
Safety First!
Key indicator 2020 Target by 2025
Group Safety team leads and develops Accident frequency (LTA1) Group: 7.2 -> 7% increase (2019: 6.7) Group: year-on-year reduction by 25%
Safety First! culture to prevent safety
Accident frequency (MTR) Group: 16.1 -> 11% reduction (2019: 18) Group: year-on-year reduction by 25%
incidents and accidents through
effective risk mitigation, training and Reported inappropriate behaviour cases Group: 9 reported cases; all reported cases Group: zero tolerance; all reported cases
investigated and followed up investigated and followed up
supporting business divisions and
functions. In 2020 Vapo Group acci- Great Place to Work Trust Index Group: 68% -> 5 percentage points Group: year-on-year increase
increase (2019: 63%) by 3 percentage points
dent frequency rate (lost time acci-
S USTAINABILIT Y RE P O RT 2020 14 WE TA KE C A R E OF T H E WEL L B EING OF OU R EM PL OY EESfrom 2019 which is major leap for- basis. COVID-19 most likely impacted
ward on our journey to become one of the amount reported cases as they
Europe’s best workplaces by 2030. The went down after moving to remote Our wellbeing actions and COVID-19
response rate remained at high level work. coordination have been appreciated
in 79%, showing strong personnel
commitment to develop the company The global pandemic prevention COVID-19 task force representing all countries and businesses worked
culture. The single statement ‘Taking was the main common wellbeing on regular basis during the year sharing best preventive practices on
everything into account, I would say action in 2020. Other country-specific sites. Local coordinators were named to support personnel with lo-
this is a great place to work’ was posi- actions focused in early phase support cal COVID-19 related practical challenges. In 2020, the actual COV-
ID-19 cases in the Vapo Group companies was very low, total of 20 in
tively rated by 75% of personnel com- for wellbeing at work, e.g. shorten-
all countries.
pared to 69% previous year. ing long sick leaves through increased
individual support activities and in
In both April and September 2020 Pulse Surveys 73% of the respond-
Survey has brought new perspectives Finland also introducing availability ents indicated that their wellbeing at work is good and the COVID-19
and clear benchmarks for the devel- of online services to the occupational related communication has been good. COVID-19 has challenged
opment of our working culture, lead- health care. everyone working in production with extra precautions or in the office
ership, and shared ways of work- meaning working mostly remotely. COVID-19 related restrictions have
ing. Results were based on previous Competence challenged also those working in operations
planned actions to improve clarity of development
shared goals, two-way communica- Wellbeing activities have been offered as online self-services available
tion, and wellbeing, made on Vapo License to Lead program providing for everyone in the intranet to support both physical and psychosocial
Group level, but also on team level a full view for people processes and health in remote work. Lack of social network and work community
and followed up during the year. principles was introduced in 2020 as is a challenge for line managers based on both Pulse Surveys and the
Great Place to Work Survey 2020. Balancing work and private time
a common basic leadership training
with workload seemed to be the greatest challenge for our personnel
We continued to measure discrimina- program. Part of the content was tai-
who are working from the home office, and especially for line manag-
tion and inappropriate behaviour to lored based on the interest of the par-
ers. Online wellbeing webinars have been offered for home office er-
pay attention to one of our core val- ticipants. As part of continuing the gonomics and for keeping the spirit up.
ues, “Trust through respect”. Line harmonization of ways of working
manager training was started in the across countries, the program was, in Our value, “Trust through respect” has been put in practice; open
Netherlands for how to recognize and addition to new line managers, also comments in all surveys have shown that our personnel respects the
handle possible situations. We will provided to all Dutch and German trust and the flexibility that the employer has shown in different in-
continue to strengthen the aware- line managers. Establishing the prac- dividual situations and the same can be said vice versa in this very
ness of the Zero Tolerance principle in tice of all teams defining their compe- unique and continuing period of work life.
all countries during 2021. The Group tence development plans was one of
Management Team follows up the the shared actions based on the per-
number of reported cases on monthly sonnel survey for 2020.
S USTAINABILIT Y RE P O RT 2020 15 WE TA KE C A R E OF T H E WEL L B EING OF OU R EM PL OY EESWe contribute to the benefit of the society
Vapo Group has locally a particularly in Vapo Group’s main in the heat and power business as energy tax of EUR 3/MWh applied
significant economic and operating countries of Finland, Swe- well as environmental protection and to peat (in heating), due to climate
employment impact. den, Estonia, and the Netherlands. field maintenance in the peat produc- change risks. Considering this assess-
Vapo Group’s total gross investments tion business. Net investments (gross ment, we decided in November 2020
Vapo Group companies pay all statu- in 2020 were EUR 82.8 million (cor- investments – asset sales) totalled EUR to discontinue energy peat produc-
tory taxes, based on their own busi- responding figure in 2019: EUR 79.8 66.9 million in 2020 (corresponding tion at 123 production sites (40% out
ness operations, to the country in million), or 175% of the amount of figure in 2019: EUR 58.9 million). of total 307 sites in Finland). This also
which they operate. None of Vapo depreciation (corresponding figure in meant a write-down of approximately
Group companies have unpaid taxes. 2019: 156%). Financial implications and EUR 100 million on our peat assets.
Vapo Group administration is respon- climate risks related to peat
sible for the implementation of the Investments in the activated carbon Although the need for peat will
tax strategy and compliance with production facility in Ilomantsi, Fin- According to the consumption fore- increase for other businesses than in
country-specific tax regulations. land began to a significant degree casts of Vapo Group’s fuel customers, energy use, we believe we can reduce
during the financial year. Investments the demand for energy peat will fall significantly the land reserved for
Vapo Group’s local impact as an were also allocated to capacity expan- to half of the current level by 2025. peat production over the next years.
employer, taxpayer and buyer of sion, energy efficiency investments The reasons for this are the price of This will directly reduce our emis-
products and services is significant, and reducing the use of fossil fuels emissions allowances and the current sions to air.
Paid taxes 2020 Investments in 2020
Finland 25.1 M€
Sweden 9.2 M€ Gross 76.6 M€
Estonia 2.5 M€
Spain 0.2 M€
The Netherlands 6.6 M€ Net 59.1 M€
Germany 0.3 M€
S USTAINABILIT Y RE P O RT 2020 16 WE C ONT R IB U T E T O T H E B ENEF IT OF T H E S OC IET YSustainability with our also to our contractors. We will con-
suppliers and contractors tinue to learn from contractor acci-
dents and are committed to conduct- Securing supply of fuel to our Finnish customers
Supplier Code of Conduct (CoC) is ing an accident investigation of each during COVID-19 restrictions and lock-down
an important part of our sustainabil- reported accident. Overall, in peat
ity and we need to ensure that our production peak season 2021 in Fin- Even before the formal COVID-19 restrictions in Finland, Vapo Group
suppliers share and respect our val- land alone we have 100 main con- started planning and instructing our staff and contractors to secure
ues. During 2020 we updated the tractors with roughly 750 people the fuel deliveries to customers. A small task group was established to
Supplier CoC signature with 119 sup- including their employees or sub-con- gather information from authorities and from customers and to create
pliers. Our target for CoC coverage tractors, and approximately 80 peat instructions and procedures for the supply chain members to prevent
includes those 137 suppliers with transportation contractors plus 150 COVID-19 infections and to ensure smooth customer deliveries.
whom the annual business value contractors in other operations.
exceeds EUR 300,000 and their CoC The actions included purchasing of protective materials for the sup-
ply chain and e.g. creating procedures where one vehicle or a load-
signature was from before 1.1.2018. In 2020, all of our main peat produc-
er is driven by only one or few pre-defined persons. Many customers
During 2021 Supplier CoC is imple- tion contractors in Estonia partici-
issued their own restrictions that were immediately distributed to the
mented to all new purchasing con- pated in half day standardized occu-
relevant delivery organization. During the Uusimaa region lockdown
tracts. pational safety training, and safety Vapo issued permissions to all customer delivery critical parties.
topics were included in peat contrac-
In 2020, we extended the monitor- tor season kick-off meetings in Fin- In the fall when the COVID-19 situation again got worse all the re-
ing accidents and safety observations land, Sweden and Estonia. strictions and preventive actions were already the new normal, so it
didn’t cause any additional actions. Naturally even in the fall the situ-
ation was carefully monitored to secure that the instructions were fol-
lowed.
Despite the COVID-19 restrictions from both the authorities and the
customers, the customer deliveries run smoothly and without any ma-
New Supplier Code of jor issues. Also, the personnel involved in the supply chain was suc-
Conduct implemented in cessfully kept safe.
87%
of the contacted
suppliers during 2020.
S USTAINABILIT Y RE P O RT 2020 17 WE C ONT R IB U T E T O T H E B ENEF IT OF T H E S OC IET YKekkilä-BVB – Growing together for a better future
Our strategy has been to KEY PERFORMANCE OVERVIEW
grow extensively outside
Focus area KPI 2020 Target
of Europe and in our home (2019) 2030
markets through excellent
Flourishing people Great Place to Work 68% (63%) 80%
leadership and best in busi- • We enhance the health, safety and wellbeing of our Trust Index
ness operational efficiency. employees, customers and partners in the value chain
• Kekkilä-BVB is an inclusive and inspiring workplace Lost time accidents 6.7 (11.5) 0
frequency (≥ 1 day)
Kekkilä-BVB has a turnover of EUR % signed Supplier Code of 81% >99%
300 million, employing over 550 peo- Conducts and/or suppliers
audited*
ple in Finland, Sweden, the Nether-
lands, Germany, Estonia, and Spain. Sustainable food & living C2G CO2 footprint** Baseline t.b.d. -30%
• Through collaboration with suppliers and customers we aim
Our main markets today are in the for a carbon neutral society # of new innovations 3 30
Nordic countries and the Netherlands • Our innovations contribute to sustainable solutions for supporting sustainability
and our products are available glob- growing, gardening and the built environment
ally in more than 100 countries. Our Green growth & recycling % of recycled plastic 17% 80%
main customer segments are profes- • Through collaboration we aim to create a more circular in packaging
value chain and optimally use locally available raw materials.
sional growers, retail and consumers, • Our own operations create zero waste
landscapers, and raw material custom-
Biodiversity & restoration % of certified responsibly 25% (22%) 95%
ers. • We will enhance biodiversity in urban areas in a proven way produced peat
• We ensure that sourcing and processing of raw materials is
done in an environmentally sustainable way
We have an important role to play
in mitigating the current food cri- *Our target for Code of Conduct coverage includes those suppliers with whom the annual business value exceeds EUR 300,000 and their CoC
signature was from before 1.1.2018.
sis caused by growing populations,
**C2G stands for Cradle-to-Gate, meaning from sourcing of raw materials to the finalized product at our factory gate. In 2021 the C2G footprint
degrading agricultural land, water is determined and the baseline set based on 2020 data. Targets are relative to the 2020 baseline and relative to production volume.
scarcity and extreme weather patterns
caused by climate change. We also
play a significant role in bringing the
joy of gardening to people to increase our expertise to ensure that urbaniza- We have focused on being the most vative, helpful, and easy digital solu-
health, wellbeing, and the commu- tion leads to healthy, biodiverse and transparent and collaborative com- tions to our customers. We are eager
nity feeling. On a larger scale we use climate proof neighbourhoods. pany in the industry providing inno- to invest in new opportunities to
S USTAINABILIT Y RE P O RT 2020 18 KEKKIL Ä - B VBGrowing together for a better future
Flourishing people Sustainable food & living
• We enhance the health, safety and wellbe- • Through collaboration with suppliers and
ing of our employees, customers and customers we aim for a carbon neutral society.
partners in the value chain.
• Our innovations contribute to sustainable solutions
• Kekkilä-BVB is an inclusive and inspiring for growing, gardening and the built environment.
workplace.
Biodiversity & restoration
Green growth & recycling
• We will enhance biodiversity in urban
areas in a proven way. • Through collaboration we aim to create a more
circular value chain and optimally use locally
• We ensure that sourcing and processing available raw materials.
of raw materials is done in an environmentally
sustainable way. • Our own operations create zero waste.
S USTAINABILIT Y RE P O RT 2020 19 KEKKIL Ä - B VBgrow and support our customers with part in the cultivation of healthy foods, This year has proved to be a good year ter and wellbeing. Through collab-
the best knowledge of sustainable and thus they positively impact both regarding safety and wellbeing of our oration with suppliers and custom-
growing practices. Our aim is to have healthy diets as well as the prevention own employees despite the COVID- ers we can reduce the amount of car-
the most satisfied and loyal customers of diseases. In addition, green roof sub- 19. We were already used to distance bon emissions in the value chain and
and employees in the industry. strates, lawn soil and horticultural sub- working and were able to quickly aim for a carbon neutral society by
strates contribute positively to biodiver- take all the needed safety meas- 2050. Also, our efforts in innovations
Our sustainability focus areas sity.” ures to prevent the spread of virus and partnerships aim to improve the
also at the factories. The increase in sustainability of our solutions. Inter-
We have four sustainability focus areas Another great achievement in 2020 employee satisfaction from 63% to esting developments from that per-
and have set concrete and measurable was the development of a sustaina- 68%, as measured by the Great Place spective have for instance been the
KPI´s to steer our progress in improv- bility checklist for investments in our to Work Trust Index, in this challeng- increased use of Sphagnum moss
ing our positive sustainability impact. site operations. The checklist takes ing year shows that we are focusing (also known as Accretio), a renew-
all of our sustainability focus areas on the right issues. Our safety perfor- able growing media constituent, as
Achievements in 2020 into account whenever an upgrade mance showed improvement as well, well as further experimentation with
is made to the production processes. across all Kekkilä-BVB countries. The smart growing to optimize irrigation
Our overall sustainability target is to This means decisions take into con- lost time accident frequency reduced effectiveness. The coir case shows
improve our net positive impact every sideration the impact on health and by 41%, while the medical treat- that we are also active in improving
year. Being net positive means that we wellbeing, energy efficiency, waste ment accident frequency reduced by the water consumption in the value
contribute more to the world than we prevention and other aspects of our 34%. Getting to zero accidents will chain.
take from it. We currently evaluate net sustainability focus areas. still require a lot of effort, but it will
positivity through the Upright Project remain our ultimate goal. We are working to understand the
net impact model. This tool uses over Focus area: Flourishing people lifecycle CO2 footprint of our port-
200 million scientific publications We’ve also continued our collabo- folio. Together with Growing Media
to determine the positive and nega- As Kekkilä-BVB we want to take care ration with our suppliers to become Europe, which presents the growing
tive impact for 19 focus areas cover- of the wellbeing of our employees more sustainable together. Over media producers at European level
ing society, knowledge, health, and and our partners. We ensure equal 80% of the contacted suppliers have we are currently updating the cal-
environmental topics. The final result opportunities, good working condi- already signed. culation methodology and emission
showed that we are overall a net posi- tions, safe working environments and factors to be used. We expect to be
tive company, with a score of +4.4. engaged employees that are happy Focus area: Sustainable able to communicate about our full
to work for and with us. We play a food and living carbon footprint during 2021.
The main reasons for the positive significant role in bringing the joy
impact of Kekkilä-BVB are explained of gardening to people to increase One of the biggest challenges of our Taking only our operations into
by the Upright Project net impact health, wellbeing, and the commu- time is climate destabilization that account, on average 1.5 kg of CO2
model as follows: “Soils as well as veg- nity feeling. In whatever we do we impacts the way we can fulfil our is emitted per cubic meter of pro-
etable, fruit and herb substrates play a aim for flourishing people. basic needs like food, water shel- duced growing media. We are work-
S USTAINABILIT Y RE P O RT 2020 20 KEKKIL Ä - B VBing hard to reduce our carbon foot- average 7.4 kg CO2 per cubic meter. tations on the future of horticulture, enables reuse or recycling. Choosing
print further. In the Netherlands, for We aim to reduce this by optimizing smart growing and climate change. local raw materials will help reduce
instance, we are already producing routes, modal shifts and local sourc- logistical emissions as well, but first
25% of our electricity consumption ing where possible. Focus area: Green growth and foremost our products should ful-
through solar panels on our own and recycling fil the needs of our customers as well
roofs. For transporting raw materials In our Grow21 video lounge you can as possible. By sharing knowledge
to our production sites, we emit on find quite a few interesting presen- There are several ways we can contrib- and experience in the value chain we
ute to a more circular economy. First hope to contribute to a more circular
of all, in the choices we make regard- economy.
ing which raw materials we use and
Saving water in our coir production process
how we use them. And secondly by This year we’ve focused to further
A lot of water is used within the coir production process to ensure safe use and designing our packaging in a way that improve the circularity of our packag-
top quality. Water is needed for both washing and buffering coir. When we re-
ceive the coir from producers in Asia (mostly India and Sri Lanka) it has been
washed, dried, and compressed on site. In order to optimally prepare it for use Teuva composting plant closing the loop
in growing media we take it to our factory in the Netherlands for expanding,
buffering and washing. In Finland, Kekkilä-BVB has four composting plants that process organic
wastes from municipalities and industry including greenhouse wastes, like
In the past our suppliers used to do all the buffering as well. We noticed plant materials and our own used substrates. Thanks to these composting
that more water was used than necessary in these processes and decided plants approximately 90,000 tonnes waste obtains a new purpose. The re-
to act on this. By moving part of the buffering to our own production sites, cycled fertilizers and compost generated as the end product get utilized in
we increased water use efficiency. In general, we save about 10% on water landscaping and local agriculture. At our Teuva composting plant, we have
consumption, but for some types of coir even up to 30%. almost completely closed the substrate loop together with our customers:
Another environmental benefit is that the water used for washing and buff- 1. First, we provide our customers with substrate material that best fit the
ering goes to water treatment facilities in the Netherlands. At the harvesting selected crop and intended growing conditions.
locations the wastewater from buffering would end up on the plantations. 2. After the growing cycle has completed, we will pick up the used substrate
And although water is beneficial for the trees, the salts in the wastewater materials and bring them to our composting plant.
are not. These salts will negatively affect groundwater and plant growth and 3. After processing the resulting compost will be used for substrates for land-
in the end will require even more water to be used for washing the next scaping, the consumer market and as soil improvers for local agriculture.
batch of coir. In addition, the fine coir particles left in that water form a sol-
id top layer on the soil. This causes a lack of oxygen in the soil. We are especially proud that the quality of compost from our own used sub-
strate materials is at such a level that it’s suitable for the organic horticultur-
It is safe to say that moving part of this water-using process to the Nether- al production and nutrients can produce new growth again. This way we
lands lowers the environmental impact in India and Sri Lanka. can contribute to the circular ambitions of our growers as well.
S USTAINABILIT Y RE P O RT 2020 21 KEKKIL Ä - B VBYou can also read
