Case study: How CNH Industrial creates economic value for its stakeholders
CNH Industrial is a global leader in the capital goods sector with 70 manufacturing plants, 59 R&D centres, a workforce of 71,895 employees, and a commercial presence in approximately 180 countries. CNH Industrial seeks to create, through its global operations, sustainable, long-term value, and distribute it to its stakeholders. Tweet This!
This case study is based on the 2021 Sustainability Report by CNH Industrial, prepared in accordance with the GRI Standards, that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
In 2021, the value added generated by CNH Industrial’s activities and distributed to its various stakeholders totalled $7,139 million, equivalent to 21.4% of revenues. In order to create economic value for its stakeholders CNH Industrial took action to:
- create economic value for employees
- create economic value for shareholders
- create economic value for financial providers
- create economic value for the government and public institutions
- create economic value for local communities
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With this case study you will see:
- Which are the most important impacts (material issues) CNH Industrial has identified;
- How CNH Industrial proceeded with stakeholder engagement, and
- What actions were taken by CNH Industrial to create economic value for its stakeholders
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What are the material issues the company has identified?
In its 2021 Sustainability Report CNH Industrial identified a range of material issues, such as circular product life cycle, CO2 and other air emissions, occupational health and safety, employee engagement, renewable energy. Among these, creating economic value for its stakeholders stands out as a key material issue for CNH Industrial.
Stakeholder engagement in accordance with the GRI Standards
The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:
Stakeholders must be consulted in the process s of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.
Key stakeholder groups CNH Industrial engages with:
Stakeholder Group | Method of engagement |
Customers
| · Direct engagement in materiality analysis · Market research · Focus groups · Customer satisfaction surveys · Above-the-line and below-the-line communication channels · Two-way communication through: web, direct mailing, dealerships, toll-free numbers, etc. · Events (e.g. product launches) and participation in exhibitions, trade fairs, and conventions · Customer-Driven Product Development (CPD) · Compliance Helpline |
Dealer and service network
| · Direct engagement in materiality analysis · Daily contacts and periodic meetings with the network · Two-way communication through the web Dealer Portal and dedicated phone lines · Individuals responsible for monitoring the network and ensuring fulfillment of contractual standards · Dealer development programmes · Programmes to support dealers, including training, definition of standards, financing, and promotional campaigns · Compliance Helpline |
Employees | · Direct engagement in materiality analysis · Daily dialogue · Intranet portal · Meetings to discuss expected and actual performance levels and professional development paths · Compliance Helpline |
Professional organisations and associations | · Direct engagement in materiality analysis · Town hall meetings to share and align with corporate objectives and decisions |
Employees’ families
| · Participation initiatives (e.g., Children’s Christmas, Family Day) · Internal publications |
Financial community: Traditional and ESG investors
| · Direct engagement in materiality analysis · Annual General Meeting · Price-sensitive disclosures and information · Quarterly conference calls · Seminars, industry conferences, roadshows, and meetings · Daily dialogue (meetings, telephone, emails) · Investor Relations section of the Company website · EU Annual Report · Sustainability Report |
Journalists, media, and opinion leaders | · Direct engagement in materiality analysis · Daily dialogue · Presentations and press conferences · Meetings · Brand and Company websites |
Local communities: Religious, cultural, and socio-political associations, health systems, schools & universities, and non-governmental & non-profit organisations | · Direct engagement in materiality analysis · Meetings with representatives of associations, organisations or local communities · Actions or projects, managed directly or in partnership · Cultural exchange programmes · Employee volunteering activities · Compliance Helpline
|
Public institutions: Government, local authorities, public agencies, regulatory bodies, international institutions, trade associations, and non-governmental organisations | · Direct engagement in materiality analysis · Periodic ad hoc meetings on corporate objectives and position · Participation in working groups, development of joint projects and alliances · Collaboration on R&D projects · Initiatives to highlight regulatory issues · Dialogue with institutions and environmental associations |
Scientific and technological research centres and universities | · Direct engagement in materiality analysis · Open-source tools · Periodic meetings |
Suppliers and commercial partners | · Direct engagement in materiality analysis · Daily relationship through buyers · Web Supplier Portal · Come to our Plant initiative · WCM suppliers · Supplier Advisory Council (SAC) · Conventions · Technology Days · Suppliers’ Proposals Programme · Compliance Helpline · Dedicated email addresses |
Trade unions and employee representatives | · Direct engagement in materiality analysis · Institutional meetings and other exchanges pursuant to legal or contractual provisions at plant, legal entity, regional or national level · Trilateral meetings (Company, trade unions, and government bodies) on matters of particular importance · Ad hoc meetings at plant, legal entity, regional or national level |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics CNH Industrial received feedback from a sample of 2,068 stakeholders among employees, customers, dealers, opinion leaders, public institutions, NGOs, investors, and journalists through an online survey or direct interview.
What actions were taken by CNH Industrial to create economic value for its stakeholders?
In its 2021 Sustainability Report CNH Industrial reports that it took the following actions for creating economic value for its stakeholders:
- Creating economic value for employees
- In 2021, 65.8% of the value added generated by CNH Industrial ($7,139 million) went to employees.
- Creating economic value for shareholders
- In 2021, 2.6% of the value added generated by CNH Industrial ($7,139 million) went to shareholders.
- Creating economic value for financial providers
- In 2021, 8.1% of the value added generated by CNH Industrial ($7,139 million) went to financial providers.
- Creating economic value for the government and public institutions
- In 2021, 9.0% of the value added generated by CNH Industrial ($7,139 million) went to the government and public institutions.
- Creating economic value for local communities
- In 2021, 0.1% of the value added generated by CNH Industrial ($7,139 million) went to local communities.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standard addressed in this case is: Disclosure 201-1 Direct economic value generated and distributed
Disclosure 201-1 Direct economic value generated and distributed corresponds to:
- Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
- Targets: 8.1, 8.2
- Sustainable Development Goal (SDG) 9: Industry, Innovation and Infrastructure
- Targets: 9.1, 9.4, 9.5
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References:
This case study is based on published information by CNH Industrial, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original please revert to the following link:
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