Neste creates value for society by helping its customers reduce climate emissions through developing sustainably produced lower-emissoin solutions for transportation, aviation, and marine uses, as well as renewable and circular solutions for the chemical and plastics industries.
Neste’s value creation is based on its high-quality products, global business model for raw material sourcing and product sales, in-depth knowledge of regulations and global customer requirements for both fossil and renewable products, as well as continuous innovation and development of products and solutions. Non-financial assets, e.g. production, sales, and sourcing expertise are also an essential part of Neste’s value creation.
Neste’s value creation map
Value creation assessment
The company’s impacts related to environmental, social, and governance (ESG) matters can be both positive and negative, and their magnitude varies across business areas, countries, and based on the products in question. It is crucial for Neste to understand how it creates value in society regarding these aspects. The importance of evaluating the company’s value chain is increasingly emphasized and called for by stakeholders, especially investors.
Understanding how we create value for shareholders and the society at large enables us to evaluate our role in the society, identify and manage risks, as well as help us recognize long-term business opportunities. In addition, understanding the views and expectations of our stakeholders plays a crucial role in the success of our company and the acceptability of our operations. This is why we engaged in a project to update our materiality assessment and incorporate the identified material topics into value creation assessment in early 2018.
Through evaluating how Neste creates value, we are able to embed sustainability even further in our everyday business and create tools for decision-making and sustainability management. By developing a value creation framework we are able to better understand and visualize how sustainability is incorporated into value creation and which capitals are needed for successful business. In addition, concretizing value creation helps Neste assess the relevance of different impacts in the short and longer term and integrate them into business decisions. Due to the advantages listed above, the value creation map will be utilized in Neste’s strategy work and sustainability management, e.g. in target setting.
Results of the materiality assessment (consisting of sustainability context analysis, interviews, stakeholder survey) was utilized in the development of a refined value creation map (see above) to visualize Neste’s relevant and material ESG value creation aspects. The value creation map was further developed in an internal workshop and during data collection. Internal experts from different segments were engaged in evaluating how Neste creates value with regards to different ESG aspects. Value creation map was validated by relevant internal experts in a workshop in January 2018, and approved by Neste Executive Board in May 2018. The value creation map follows the integrated reporting guidelines.