Case study: How Nokian Tyres creates economic value for its stakeholders
Nokian Tyres develops and manufactures premium tires for people who value safety, sustainability, and innovative products. In 2019, Nokian Tyres’ products were sold in 61 countries. Nokian Tyres’ objective is to create value for its various stakeholders Tweet This!, such as shareholders, customers, consumers, and its personnel, meeting stakeholder expectations.
This case study is based on the 2019 Corporate Sustainability Report by Nokian Tyres, 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.
Abstract
Nokian Tyres brings value to its stakeholders not only as an employer and tax-payers, but also as a valued business partner, member of the community, and provider of safety. In order to create economic value for its stakeholders Nokian Tyres took action to:
- create economic value for employees
- create economic value for suppliers
- create economic value for shareholders
- create economic value for financial institutions
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With this case study you will see:
- Which are the most important impacts (material issues) Nokian Tyres has identified;
- How Nokian Tyres proceeded with stakeholder engagement, and
- What actions were taken by Nokian Tyres to create economic value for its stakeholders
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What are the material issues the company has identified?
In its 2019 Corporate Sustainability Report Nokian Tyres identified a range of material issues, such as risk management and good governance, human rights in the supply chain, responsible and ethical purchasing policies, high level of safety and health at work. Among these, creating economic value for its stakeholders stands out as a key material issue for Nokian Tyres.
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 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 Nokian Tyres engages with:
| Stakeholder Group |
| Employees and other workers |
| Consumers and other end-users |
| B2B customers (business partners) |
| Suppliers and subcontractors |
| Governments |
| Shareholders |
| Local communities, especially in factory locations in Finland, Russia, and the US |
| Media |
| Non-governmental organisations |
| Vulnerable groups |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics, Nokian Tyres conducted a sustainability survey where the most important stakeholder groups defined their individual material topics and risks and opportunities in terms of Nokian Tyres’ sustainability. The survey was conducted in eight countries, online and as personal interviews.
What actions were taken by Nokian Tyres to create economic value for its stakeholders?
In its 2019 Corporate Sustainability Report Nokian Tyres reports that it took the following actions for creating economic value for its stakeholders:
- Creating economic value for employees
- In 2019, Nokian Tyres paid MEUR 232.2 for employee wages and salaries.
- Creating economic value for suppliers
- In 2019, the cost of goods, materials, and services purchased by Nokian Tyres reached MEUR 691.6.
- Creating economic value for shareholders
- In 2019, Nokian Tyres paid MEUR 218.1 in dividends.
- Creating economic value for financial institutions
- In 2019, Nokian Tyres’ net financing payments reached MEUR 4.9.
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 Nokian Tyres, 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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