Community builder with clear priorities
Peab works daily to improve everyday life for people where they live it in the Nordic region. We do this by building everything from homes, schools, retirement homes and hospitals to bridges, roads and other infrastructure in our communities.
For Peab sustainability means running a business that takes responsibility for both its own impact and the impact of the entire value chain upstream and downstream, as well as working for the good community. Working sustainably is a strategic matter for us, completely integrated into our business model and operations. We make it clear that every employee should promote sustainable development in their role based on Peab’s core values, business concept, mission, strategic targets and Code of Conduct.
We operate over a broad spectrum of community building which naturally has both positive and negative effects on the world around us. We provide our employees with secure employment and meaningful careers with development opportunities but at the same time the frequency of injuries in the construction and civil engineering industry is high and our employees are exposed to risks on construction sites that can lead to accidents. The industry is traditionally male dominated, which entails a lack of gender equality and diversity. Furthermore, there are risks for ethical transgressions in the complex value chains common for the community building sector. Therefore we have a responsibility to ensure that our suppliers follow good ethics and care about the environment and human rights.
Our operations impact the environment and climate in various ways. For example, materials we use, like concrete and steel, generate carbon emissions and other components are environmentally and health hazardous. We use the earth’s finite resources and have to become better at working circularly and resource efficiently as well as caring about the impact we have on nature and fostering biodiversity. We put the same demands on our suppliers and their suppliers and have an ongoing dialogue with our customers to help them achieve their environmental and climate goals. Collaboration is a prerequisite for positive change and transition.
As a major local player and Nordic employer it is important that through cooperation and dialogue we understand the needs and challenges society is facing, in particular those in our local communities. By comprehending this we can contribute to local development while reducing the negative impact of our business.
We want to take responsibility, either by contributing to a more climate-adapted use of material, healthy competition or safe and inclusive workplaces. As one of the largest Nordic community builders our target is to be the Best workplace and Leader in social responsibility in our industry. This is a commitment that comes with obligations, which is why we have set up and monitor targets for these areas, along with the Group’s financial targets.
Our material sustainability aspects are processed within the framework of our four strategic targets, and in particular the two mentioned above: Best workplace and Leader in social responsibility. The targets also comprise our external and internal targets.
Locally produced community building
Our four business areas that collaborate locally are the basis for how we work with our material sustainability aspects, which gives us good control over the value chain. Our employees should as far as possible use local resources in the form of our own employees, our own input goods and subcontractors. This, together with our integrated climate and environmental work and engagement in people and the community, forms the foundation of what we call locally produced community building.
Eight material sustainability aspects
Peab’s material sustainability aspects form a unit in which the various parts affect each other. During the year in preparation for the new business plan for 2024-2026 and the EU Corporate Sustainability Reporting Directive (CSRD) we have worked to produce a double materiality assessment to update Peab’s material sustainability aspects. We have analyzed the various sustainability aspects that make up the European Sustainability Reporting Standards (ESRS) and the effect they have – or can have – as well as the actual or potential financial consequences. We have evaluated the sustainability aspects from a risks and opportunities perspective, severity level and probability as well as impact – short, medium and long term. The material sustainability aspects emanate from both the areas where our business has a negative effect on people and the environment and where our business makes or can make a positive difference. In the analysis we have also considered the actual or potential impact on Peab’s main value chains. Ongoing dialogues with representatives from our stakeholders contribute as well to the double materiality analysis. These stakeholder dialogues are held with customers, suppliers, shareholders/investors, non-governmental organizations and employees in various parts of our own organization. The stakeholder process has comprised meetings, interviews and different kinds of issues communicated to Peab by our stakeholders. Our assessment has also been based on studies, reports and relevant guidelines. We have determined threshold values based on all the contributions we have compiled and consider sustainability aspects higher than these threshold values to be material. We will continue to develop this materiality process and report the double materiality assessment in the Board of Directors’ Report, including reporting according to CSRD as soon as the law enters into force. Until then we will continue to have eight material sustainability aspects which will be reported within the GRI framework.
Our material sustainability aspects are categorized under the two strategic targets Best workplace and Leader in social responsibility and targets are set for them to ensure that they are integrated into our operations and governance.
Stakeholders guide us
Peab’s material sustainability aspects and actions are based on the actual and potential impact of our business on people and the environment by both our own operations and throughout our value chains. We have ongoing stakeholder dialogues with representatives from our stakeholder groups. This keeps us aware of the expectations and demands of our stakeholder groups and what issues are most important to them. These dialogues take place in both informal meetings with customers, suppliers, employees and other stakeholders and in more structured contexts such as supplier audits, meetings with politicians and other decision-makers, owner and investor dialogues and seminars at colleges. The outcome from these dialogues partly forms our materiality analysis and sustainability work priorities. In the dialogues – independent of which stakeholder group – we inform about the progress being made in our operations, provide good examples and initiatives but also point out the challenges. In this way we can create and maintain constructive and transparent conversations and promote collaboration that leads to actual development.
| Stakeholder | Expectations of Peab | Dialogue examples | Value creating |
| Shareholders/Investors | Responsible ethical entrepreneurship, long-term financial value development that creates annual dividends, ongoing risk mapping and risk management, awareness and measures to reduce climate and environmental impact, responsibility throughout the value chain and community involvement, for example in the form of local development. | AGM, analyst meetings, surveys from investors and owners, investor meetings and conversations, national and international evaluations. |
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| Employees; existing and potential | Responsible ethical entrepreneurship, good work environment and high degree of safety, skills development, good leadership, equal treatment, gender equality and diversity, good work and employment conditions, awareness and measures to reduce climate and environmental impact, community involvement, for example in the form of local development and responsibility throughout the value chain. | Daily dialogue, employee surveys, work environment evaluations, work environment dialogues, student surveys, workplace meetings, union collaboration, internal training, incident follow-ups, management meetings, goal and developmental discussions, external surveys concerning employer brand, collaboration with students and the education system. |
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| Customers | Responsible ethical entrepreneurship, professional businessmanship, competence, resource capacity, quality, availability, experience and expertise exchanges, good work and employment conditions, certifications, ongoing risk mapping and risk management, awareness and measures to reduce climate and environmental impact, community involvement, for example in the form of local development and responsibility throughout the value chain. | Meetings in person, daily contacts, networks, partnership projects, dialogue meetings, customer meetings, fairs, customer surveys, questionnaires from customers, procurements and audits. |
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| Suppliers | Responsible ethical entrepreneurship, professional businessmanship, ongoing risk mapping and risk management, awareness and measures to reduce climate and environmental impact (preferably with the supplier), responsibility throughout the value chain. | Procurements, supplier evaluations, meetings in person, daily contacts, supplier meetings, supplier audits, sustainability dialogues and partnership projects. |
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| Local community | Contributions to local community development, cost-efficient construction and housing in different price categories, ongoing risk mapping and risk management, awareness and measures to reduce climate and environmental impact, care for the local environment, community involvement through, for example, integration programs and contributions to job experience for youths, sponsoring local youth activities, responsibility throughout the value chain. | Receiving visits, partnership projects, information meetings, networks, contacts with county boards/municipalities, consultation, environmental reports, vision work, mentoring, sponsored projects, citizen and resident dialogues. |
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Steering Peab’s sustainability work
Peab steers sustainability work through identifying, assessing and managing risks and opportunities, working systematically with continual improvements and identified key activities and projects, and measuring progress through targets for the Group and targets specific for the business areas and subsidiaries within our material sustainability aspects. In 2023 we introduced an overriding Sustainability Council to further supplement existing governance and promote target steering. Among other things, the Sustainability Council coordinates sustainability matters and ensures that Peab’s executive management is informed regarding important consequences, risks and opportunities linked to sustainability work. The Sustainability Council is led by the CSO and COO. In addition, in the business plan period 2024 to 2026 we have created two Group-wide development programs that work on our climate transition and responsibility in the value chain to further empower these important sustainability factors. As far as possible central regulations and management systems are steered on a local level, close to operations.
Peab’s Board has given executive management the overriding responsibility for governing and monitoring of sustainable work in operations. Peab’s four business area managers, who all report to the CEO, are responsible together with the COO, CSO and CCO for ensuring sustainability work is an integrated part of business. They have sustainability specialists on Group level and in the business areas as well the Sustainability Council to aid them. Executive management monitors sustainability work at every executive management meeting, reviews special events with a bearing on these issues and delves into a sustainability theme every meeting. Governance is based on the four strategic target areas with associated external and internal targets. Some of the targets are monitored quarterly by both the Board and executive management, while others are monitored every half-year or annually. Monitoring targets and their outcome enables executive management to steer operations and implement measures if necessary.
Central regulations and management systems for governing
Central regulations and management systems for governing in Peab comply with international conventions and national laws. Peab’s fundamental, internal governing document, the Peab’s Code of Conduct, is based on the UN Global Compact principles including the precautionary principle, UN’s human rights and ILO’s core conventions. It is reviewed and updated as needed annually. Peab signed Global Compact 2012 and the Annual and Sustainability Report is the Group’s Communication on Progress, which is the annual report to Global Compact. As decided by Peab’s President and CEO, the company will continue to follow UN Global Compact.
Peab follows UN’s Guiding Principles on Business and Human Rights (UNGP) and OECD’s Guidelines for Multinational Enterprises, including the methods prescribed by the OECD guidelines.
The Board of Directors has ultimate responsibility for ensuring that our Code of Conduct is followed and communicated. This responsibility is delegated to the CEO and then down the chain of command through management which is responsible for ensuring that the Code of Conduct along with associated guidelines and rules are complied with by the various functions and departments. In the end every employee is responsible for taking in the information and following the Code of Conduct. The Group’s purchasing function is responsible for monitoring that suppliers follow the as of 2023 special Suppliers Code of Conduct.
The Code of Conduct is complemented by four overriding policies; the Environmental Policy, Quality Policy, Information Security Policy and Work Environment Policy. These are then supplemented by a number of guidelines and supportive documents such as Guidelines Regarding whistleblowing, Sanctions, Corruption and Competition Law. All the policies compliance specific guidelines are taught in web-based courses that employees take at regular intervals. They are also communicated to customers and suppliers and are available on Peab’s intranet and external websites. Last year all our employees took a required updated course in Peab’s Code of Conduct.
Parameters and guidelines
Respect for human rights is a given at Peab throughout the entire value chain and is clearly expressed in our Code of Conduct and the Supplier Code of Conduct. However, the risk that human rights might be violated exists in all areas of our operations, internally and externally, particularly in the supply chain. This is therefore a key issue for us and embraces several of our material sustainable aspects. Read more in the section on Risks and risk management on pages 82-85.
Peab has a whistleblower function for anyone, employees or external stakeholders, wishing to draw attention to serious deviations from the Code of Conduct or the Supplier Code of Conduct or other irregularities in the business. The function, which is available on our website and intranet, is handled by Peab’s Ethical Council, which works in systematically according to specific procedures. Whistleblowers can always be anonymous. The Ethical Council reports the number of established and significant cases of breaches in compliance with the Code of Conduct or Suppliers Code of Conduct, laws and regulations to executive management semi-annually and to Peab’s Board in conjuncture with the half-year report in the third quarter. The Ethical Council also reports on the consequences meted out. Read more about the whistleblower function in the GRI appendix.
Working with the global goals in mind
Peab’s management regularly reviews the business based on the UN’s 17 global goals and 169 targets for sustainable development. The most recent review was in 2023. For the period 2024-2026 eight of the goals were deemed extra prioritized since they are either areas that hold significant potential risk or areas where Peab has the best chance of promoting sustainable development.
Goal 5 which concerns gender equality, is important to Peab since we, like the rest of the construction and civil engineering industry, still have a long way to go to achieve equal gender distribution. Since 2021 we have quantitative targets for equality. In 2023 we launched the trainee program for women The Construction Year in order to attract more female skilled workers to Peab.
Goal 7 regarding sustainable energy is important because Peab, along with the rest of the construction and civil engineering industry, has to transition to renewable energy and increase its energy efficiency. We work with a number of measures to increase energy efficiency in both production processes and the finished products. For example, during the year we implemented an energy efficiency campaign.
Goal 8 includes work conditions and comprises several of Peab’s material sustainability aspects such as a safe work environment, good conditions in our supply chain and the path for youths into the labor force. There is also a great deal of risk associated with this area. One measure we took during the year was to further develop supply chain controls to ensure ethical and sustainable production conditions and we also produced a special Suppliers Code of Conduct. We also began working on the Group-wide development initiative quality ensured and traceable value chain.
Goal 9 that concerns sustainable industry, innovations and infrastructure is relevant in part because of its connection to our industrial and civil engineering operations and our investments in sustainable innovation. During the year we continued to, for example, develop our ECO-products and have now launched ECO-Asphalt throughout the Nordic region. We have also several research partnerships with universities and colleges.
Goal 11 which concerns building sustainable cities and communities that are safe and accessible to all in many ways sums up Peab’s core operations. During the year, among other things, we continued to develop the sustainable housing concept NärBo and built roads, ports and other infrastructure such as hospitals, retirement homes and schools that contributes to sustainable cities and communities.
Goal 12 concerning sustainable consumption and production has a clear connection to our environmental target for resource efficiency. In 2023 we continued to promote reuse and circular processes through projects and collaborations.
Goal 13 about combatting climate change, is a crucial global issue and Peab, as a major Nordic community builder, has a big responsibility in this. During the year we took several important steps towards climate neutrality through innovation and investments as well as a new collaborations to reduce greenhouse gases. One such collaboration is with SSAB on fossil free steel, where we presented the world’s first building constructed partially with fossil free steel. We also solidified our work on net zero emissions through a transition plan we call the Climate Road Map.
Goal 14 about conserving and sustainably using the oceans, seas and marine resources is relevant for Peab considering the water we use in construction and our port and by-the-sea projects. During the year we have worked to develop our processes in monitoring water consumption at our production sites and started a research project concerning water conservation in buildings.
Goal 15 concerning ecosystems and biodiversity is reflected in our environmental target for resource efficiency. We will protect, maintain and strengthen ecosystems and biodiversity when exploiting land and natural resources. Peab’s operations intrude on nature risking the displacement of species. In 2023 we produced three biodiversity plans in our mineral aggregates operations because quarries in part intrude on nature and in part can offer unique environments for endangered species.
Climate risks and opportunities according to TCFD
Peab works long lastingly and systematically to reduce our climate impact and to accelerate climate transition to a fossil free society. Climate neutrality is a highly prioritized issue for our stakeholders and Peab’s primary environmental target is to be climate neutral in 2045.
We have begun to implement Task Force on Climate-Related Financial Disclosures (TCFD’s ) recommendations. We consider them a good tool for structurally reporting how we work with our climate-related risks and opportunities as well as in identifying improvement areas. Many of these are reported in more detail in our annual CDP Climate Report available on our website.
Governance
Peab’s Board and executive management regularly work with issues associated with climate-related risks and opportunities. The Group’s environmental targets are adopted by executive management and approved of by the Board. The Board has given executive management the overriding responsibility for governing and monitoring climate work. The Group’s Head of Environment is responsible for strategically driving and coordinating Group climate work together with business area managers and specialists. Climate-related risks and opportunities are part of the strategic dialogue and the so-called Climate Road Map is one of two Group-wide development programs in the business plan period 2024 to 2026. Climate targets are two of our nine external targets and are monitored as a part of other results.
Strategy
Peab has identified climate-related risks and opportunities. A scenario analysis is the basis for identification of these. Examples of transition risks are more stringent legal requirements and higher costs for emissions. Examples of physical risks are extreme weather and floods that affect Peab’s production and solution choices.
Risk management
Peab works continuously to identify, assess and manage climate-related risks and opportunities – both physical and transition-related. We have begun the work to assess the financial effect these risks can have and to assess the company’s resilience in relationship to them. The result from the consolidated risk analysis is processed by both the Board and executive management. More about risk management in Peab can be found on pages 79-82 and in the CDP Report.
Targets and measurements
Peab has three long-term environmental targets, of which one is climate neutrality 2045. Peab uses a number of measurements to monitor target achievement and climate impact, including Scope 1-2 and parts of Scope 3. These are presented in the Annual and Sustainability Report and in the CDP Report.