Case study: How SKF creates economic value for its stakeholders
The SKF Group is a leading global supplier of products, solutions and services within bearings, seals, services and lubrication systems. The services provided by SKF include technical support, maintenance services, condition monitoring, asset efficiency optimisation, engineering consultancy and training. SKF seeks to align its business practices with the needs and expectations of its stakeholders, generating sustainable value for all. Tweet This!
This case study is based on the 2021 Sustainability Report by SKF, 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
In 2021, the economic value distributed by SKF reached MSEK 77,868. In order to create economic value for its stakeholders SKF took action to:
- create economic value for employees
- create economic value for providers of capital
- create economic value for the government
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With this case study you will see:
- Which are the most important impacts (material issues) SKF has identified;
- How SKF proceeded with stakeholder engagement, and
- What actions were taken by SKF 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 SKF identified a range of material issues, such as anti-corruption and anti-competitive behaviour, energy and emissions, occupational health and safety, diversity and equal opportunity. Among these, creating economic value for its stakeholders stands out as a key material issue for SKF.
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 SKF engages with:
To identify and prioritise material topics SKF engaged with its stakeholders through the following channels:
| Stakeholder Group | Method of engagement |
| Customers
| · Sales and marketing operations and activities carried out by the Group, which range from global discussions with key account managers to daily conversations between customer representatives and SKF’s local account managers · Customer surveys and assessments |
| Investors and analysts
| · Quarterly reports · Meetings with investors · Telephone conferences · SKF website · Press releases · Capital market days |
| Employees and union organisations | · Annual World Union Council meeting · Periodic employee feedback surveys |
| Civil society | · Local SKF organisations interact with their surrounding communities through various activities and initiatives, ranging from business related matters to volunteer work, charity work, sponsoring and local network collaboration |
| Suppliers | · SKF’s responsible sourcing programme · Local sourcing offices · On-site audits and training |
What actions were taken by SKF to create economic value for its stakeholders?
In its 2021 Sustainability Report SKF reports that it took the following actions for creating economic value for its stakeholders:
- Creating economic value for employees
- In 2021, SKF paid MSEK 24,270 for employee wages and benefits.
- Creating economic value for providers of capital
- In 2021, SKF paid MSEK 3,496 to providers of capital, including suggested dividends to SKF’s shareholders and interest expenses.
- Creating economic value for the government
- In 2021, SKF paid MSEK 2,484 in income taxes.
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 SKF, 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:
https://investors.skf.com/sites/default/files/library/Sustainability report 2021_0.pdf
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