Annual Report 2024
Contents
Annual review
This is Outokumpu
4
Year 2024 in review
5
Performance in 2024 and over the years
6
Our impact
7
CEO’s review
8
Sustainability highlights
10
Stainless steel market
21
Financial year 2024
Review by the Board of Directors
28
Sustainability Statement
40
Financial Statements
161
Auditor’s Report and Assurance Report
243
Governance and remuneration
Corporate Governance Statement 2024
253
Risk management
274
Remuneration Report
286
Information for investors
291
Outokumpu Annual Report 2024
2
In 2023, Outokumpu successfully exited the Long Products business as it was considered non-core. Majority of the Long Products business was
divested in the beginning of the year on January 3, 2023. The exit was completed on August 1, 2023 when the remaining Long Products units
were divested. In 2022, Outokumpu classified the divested Long Products businesses as assets held for sale, reported as discontinued
operations. Therefore, all figures and comments in this report refer to continuing operations, unless otherwise stated.
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About this report Our Annual Report
combines Outokumpu’s sustainability
and financial reporting. The
Sustainability Statement has been
assured, and the Financial Statements
have been audited. The Review by
the Board of Directors includes the
Sustainability Statement, which is
prepared according to the European
Sustainability Reporting Standards
(ESRS) and the Finnish Accounting Act’s
Chapter 7 on sustainability reporting.
Our official financial statements in
Finnish and unofficial translation in
English are published according to the
ESEF regulation and they are available
at www.outokumpu.com/reports.
The Vessel in New York is one of
the Outokumpu’s references and icons
in Outokumpu’s “World As Our Showroom”
campaign. Its bronzed steel and stainless steel
framework supports 154 intricately interlinked
flights of stairs, creating an interactive artwork
that invites visitors to climb 46 meters
through its geometric matrix. It is a modern
interpretation of M.C. Escher's impossible
staircases made real through advanced
materials and engineering.
Annual review
Outokumpu’s profitability in 2024 reflected
a weaker part of the global stainless steel
cycle. Despite the challenging financial year,
we progressed well in our smart
decarbonization strategy. Together with our
stakeholders across the value chain we
accelerated the green transition in the
industry through innovation and collaboration.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
This is Outokumpu
The steel industry is a major contributor
to climate change – it accounts for 10%
of global greenhouse gas emissions1.
Outokumpu is accelerating the green
transition as the global leader in
sustainable stainless steel.
Our business is based on the circular economy: our
products are made from 95% recycled materials, which we
then turn into fully recyclable stainless steel. This steel is
utilized in various applications across society, including
infrastructure, mobility, and household appliances.
Outokumpu is committed to the science-based target of
keeping global warming below 1.5°C and works toward this
goal. With up to 75%2 lower carbon footprint than the
industry average, we support our customers to reduce their
emissions. In 2024, we supported customers to reduce
their emissions by 10 million tonnes with our stainless
steel.
Our spearhead climate solution, Outokumpu Circle Green®,
is the world’s first towards-zero stainless steel with up to
93%3 lower carbon footprint compared to the global
industry average. If all the stainless steel in the world was
produced using the same methods, it would reduce global
carbon emissions by 364 million tonnes each year.
In 2024, Outokumpu employed 8,736 professionals in
close to 30 countries, with headquarters in Helsinki,
Finland and shares listed in Nasdaq Helsinki.
Outokumpu Annual Report 2024
4
Sales, EUR
5.9
billion
People
8,736
Carbon footprint up to
75%
lower than
the industry average2
1) ResponsibleSteel, Charting Progress to 1.5°C through Certification (2024).
2) Outokumpu’s average product carbon footprint (2024): 1.6 CO₂e per kg of stainless steel based on lifecycle assessment. Global average
carbon footprint of stainless steel (2024): 7 kg CO₂e per kg of stainless steel. (Outokumpu’s calculation based on data provided by CRU,
worldstainless, and Kobolde & Partners AB).
3) Circle Green CO₂ emissions: down to 0.5 kg CO₂e per kg of stainless steel. Global average carbon footprint of stainless steel (2024: 7 kg
CO₂e per kg of stainless steel.
Our vision is to be
customer’s first choice
in sustainable
stainless steel.
Our purpose is
working towards
a world that lasts
forever.
Operations in close to
~30
countries
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Year 2024 in review
Finance
Adjusted EBITDA
amounted to
Lower profitability was mainly driven by the challenging
market environment in both Europe and North America.
Sales
5.9
billion euros globally
Net debt
Outokumpu kept its balance
sheet strongest in the industry
in a challenging market.
Environment
Reduction of
emission intensity
including direct, indirect and supply chain emissions
at the end of 2024 from the baseline of 2016
95%
including recycled steel
and other recycled metals
Outokumpu has an ambitious target
to improve energy efficiency by
600 GWh. At the end of 2024,
we had improved it by
People
World-class safety
1.5
total recordable injury frequency rate (TRIFR) stayed at
the same record low level of 1.5 as in 2023.
Women’s euro of
men’s euro at
Outokumpu
We received the Fair Pay Workplace
certification in 2024.
Diversity result
+55
against the target of +100 diverse leaders to leadership
teams by end of 2025 from the 2022 baseline
Outokumpu Annual Report 2024
5
177
million euros
189
million euros
We kept our
recycled material
content on its
record-high level
0.996
32%
391
GWh
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Performance in 2024 and over the years
We are making strong progress with emission reductions and are on track to reach our adjusted EBITDA run-rate improvement
target. Nevertheless, our results in 2024 reflect the challenging market environment. We also remained the stainless steel producer
with the strongest balance sheet in the industry, maintained world-class safety performance and achieved again a record-high
recycled material content.
Adjusted EBITDA, € million
Net debt, € million
2020*
2021
2022
2023
2024
0
300
600
900
1,200
1,500
2020*
2021*
2022*
2023
2024
0
300
600
900
1,200
1,500
CO2 emission intensity,
Total recordable injury
tonnes of CO2 eq. per tonne steel
frequency rate**
2020*
2021
2022
2023
2024
0
1
2
3
2020
2021
2022
2023
2024
0
1
2
3
Key figures
2024
2023
2022
2021
2020*
Financial key figures
Net sales, € million
5,942
6,961
9,494
7,243
5,639
Stainless steel deliveries, 1,000 tonnes
1,793
1,906
2,106
2,254
2,121
Adjusted EBITDA, € million
177
517
1,256
980
250
Net result for the period, € million
-40
-111
1,086
526
-116
Free cash flow, € million*
-71
290
619
448
147
Net debt, € million*
189
-60
-10
408
1,028
Debt-to-equity at the year-end, %*
5.0
-1.6
-0.3
13.1
43.6
Environmental key figures
Recycled content, %
95.3
94.6
93.9
89.6
92.5
CO2 emission intensity, tonnes of CO2 eq. per
tonne steel
1.42
1.52
1.70
1.76
1.55
Energy intensity, use in GJ per tonne crude steel
10.9
10.4
10.5
10.2
11.0
Slag utilization rate, %
88.6
87.8
86.5
78.1
77.1
Social key figures
Total recordable injury frequency rate**
1.5
1.5
1.8
2.1
2.4
Personnel
8,736
8,750
8,591
8,727
9,915
Personnel, full-time equivalent
8,424
8,453
8,357
8,439
9,602
Outokumpu Annual Report 2024
6
* Discontinued operations are impacting the comparative years’ numbers 2020–2022. Free cash flow for year 2023 includes discontinued operations i.e. proceeds from the sale of Long product business.
** Total recordable injury frequency includes fatalities, lost-time injuries, restricted work injuries and medically treated injuries, per million working hours.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Our impact
Outokumpu Annual Report 2024
7
Retained in company,
EUR
16
million
by using our stainless
steel, equivalent of
51 million train trips
around the world.
Taxes, sponsoring
and dividends, EUR
108
million
Avoided emissions
10 Mt
10–120+
Appliances and kitchenware 10+,
tanks and tubes 20–40,
transportation 40–60,
buildings 50+,
bridges 120+.
Innovations for
decarbonization,
such as biocoke
and low-emission
products
Low-emission
electricity
90%
Ferrochrome’s carbon
footprint
67%
smaller than the industry average
In 2024, we
processed over
2 Mt
of recycled metals,
equivalent to the
weight of 321 Eiffel
towers.
Products made of our
stainless steel – life span
in years
Operating costs, EUR
5,123
million
Employees
benefits, EUR
714
million
Revenues, EUR
6,015
million
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
CEO’s review
Ready for
the next
upturn after
a challenging
year
The year 2024 was challenging for
Outokumpu in the weak economic
environment and uncertain geopolitical
situation. However, with our strong
financial position and a positive long-
term outlook for the global stainless
steel industry, we look confidently
towards the future.
Outokumpu Annual Report 2024
8
“In the current weak cycle of
stainless steel, we focus on
the factors we can control to
improve profitability and
maintain a healthy financial
condition.”
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Outokumpu’s profitability in 2024 reflected a weaker part
of the global stainless steel cycle. The adjusted EBITDA
decreased to EUR 177 million (EUR 517 million), mainly
driven by the challenging market environment, including a
high import pressure, in both Europe and North America
but also the negative EUR 60 million impact of the four-
week political strike impacting our operations in Finland in
the first half of the year.
Despite the changing conditions, we maintained our strong
market positions in both of our main markets, Europe and
North America. The year 2024 ended with Outokumpu
remaining the stainless steel producer with the strongest
balance sheet in the industry. Together with good liquidity,
this provides us with a good starting point for the new year.
It has also been a year of change with a new CEO and new
CFO. Transition has been smooth, as we both have a long
history with Outokumpu. Before starting as President and
CEO, I was a member of the Outokumpu Board of Directors
for eight years, and our new CFO Marc-Simon Schaar has
worked for Outokumpu in various roles since 2011.
Taking care of tomorrow
I am proud that we kept our leadership position in
sustainability, and we made good progress with our smart
decarbonization strategy, focusing on high use of scrap,
usage of low-emission and renewable energy and targeted
investments in biocoke. Since 2016, we have now
successfully reduced our emissions by 32%, in line with our
climate target. A critical enabler, the share of recycled
material content, remained at a high level of 95%, the
highest in the industry.
As a result, our carbon footprint is up to 75% lower than
the industry average. In 2024 alone, we supported our
customers in reducing their emissions by 10 million
tonnes. Demand for our low-emission European
ferrochrome has remained favorable, even in a challenging
market environment, and with a green premium.
Circle Green, one of Outokumpu’s innovations, can support
our customers to reduce their emissions even further. The
carbon footprint of Outokumpu Circle Green® is up to 93%
lower than the global industry average. This means that it
represents the lowest carbon footprint achieved in
commercial stainless steel production, with current
production technology. We believe that accelerating the
green transition through supporting our customers to
reduce their emissions with low-emission stainless steel is
a competitive advantage for us. Moreover, stainless steel
plays itself an important role in the green transition – in
electrification, transport and infrastructure, for example.
Focus on competitiveness
In Europe, it is critical to protect our own, already very
sustainable industries. Outokumpu is a front-runner in low-
emission stainless steel production, and there is a clear
demand for it in the market. Regulation, for example the
EU’s Carbon Border Adjustment Mechanism (CBAM), aims
to limit carbon leakage in Europe and could enforce the
competitive advantage of those producers who already
have a low carbon footprint. As a result, we have a strong
position compared to imports from many countries – but it
is up to Europe to ensure that CBAM will be effective and
works as intended.
At the same time, further trade defense measures are
likely and as they might possibly influence the global trade
flows, we need to take care of the competitiveness of
Europe in the global economy. Europe must be fast to
react and protect its critical steel industry from unfair
competition – current trade measures are not enough. The
same goes also for the North American market, where the
import pressure significantly increased during last year.
In a highly competitive industry such as stainless steel,
where conditions change, it is important for us to
continuously improve profitability. We are the market
leader in Europe and a strong number two in North
America and want to secure those positions.
Securing financial strength
In the current weak cycle of stainless steel, we focus on
the factors we can control to improve profitability and
maintain a healthy financial condition. This is the way to
handle this low point of the demand cycle and secure the
financial strength of Outokumpu. I am pleased that our
EUR 350 million EBITDA run-rate improvement actions are
progressing. In 2024, we achieved EUR 101 million
enhancement, which translates into a cumulative
improvement of EUR 287 million. We also proceeded with
our plans to reduce our direct emissions and replace fossil
coke with bio-based solution and decided to invest in a
biocarbon plant in Germany.
We look further and are working on the next strategy
phase, for which we will get back in our next Capital
Markets Day in June 2025. Whilst we prepare for that, it is
important to ensure our competitiveness also in the short-
term. For the year 2025, we have initiated decisive short-
term cost-saving measures of EUR 50 million to be
delivered and cut our planned capital expenditure to EUR
160 million. Additionally, we have already announced
some strategic decisions. While our long-term view on the
U.S. market remains positive, in this market environment
Outokumpu is not proceeding with an investment for cold
rolling capacity expansion. Nor are we are planning to
move forward with the SMR development in Tornio, Finland.
Energy is not Outokumpu’s core business, but we are
looking for a partner that is interested in investing in
energy production.
Last but not least, we would not be where we are today
without our stakeholders. I want to thank our employees
for their efforts and commitment, our customers for their
business and trust, our suppliers for their co-operation, and
our shareholders for their continued support.
Kati ter Horst
President and CEO
Outokumpu Annual Report 2024
9
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Progress in strategy
According to our vision to be the
customer’s first choice in sustainable
stainless steel, we look to retain and
further strengthen our market-leading
position. We want to meet our
customers’ increasingly critical needs.
Outokumpu’s three-year strategy is now in the
second phase, where the focus is on
strengthening the core of the company. We
aim to make the most of our current asset
base and have three key priorities:
sustainability, growth from productivity, and
customer-focused steering. We are making
targeted investments in sustainability and
productivity to improve our margins. We also
intend to create a defendable competitive
advantage through sustainability.
Read more about our strategy execution.
Outokumpu Annual Report 2024
10
Net debt to EBITDA
<1.0
in normal market
conditions
Targets
Progress
Actions
Net debt ratio at
1.1
in challenging
market environment
•
The Europe business area maintained its focus on improving
profitability through own actions, including restructuring in
Germany, furnace optimization and raw material efficiency,
streamlining the commodity stainless steel melting process
as well as commercialization of nickel alloy 825.
•
The Americas business area increased its cold-rolling
capacity and shift toward more sustainable logistics
solutions.
•
The Ferrochrome business area launched several innovative
projects, continued transition to the sub-level caving mining
method and secured green premiums.
EBITDA run-rate
improvement of EUR
350
million
EBITDA run-rate up
by EUR
287
million
(2023–2024)
EUR
600
million of capital
expenditure for
2023–2025
Stable and growing
dividend
EUR
386
million capital
expenditure
(2023–2024)
Dividend proposal of
EUR 0.26 per share
Outokumpu is on track to
reach its EUR 350 million
EBITDA run-rate improvement
by the end of 2025.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Innovation for decarbonization
Our commitment to innovation,
research and development are driving
the creation of new business models,
investments in cutting-edge
technologies, and the invention of
revolutionary products. They all
contribute to Outokumpu’s work on
decarbonization, benefiting both the
customers and the environment.
As an example, Outokumpu EvoCarbon unit is
responsible for investigating new technologies
and investment opportunities in carbon
capture and new energy projects at
Outokumpu.
Revolutionary products and new innovations
include groundbreaking metal powder
portfolio for additive manufacturing and 3D
printing and especially the world’s first
towards-zero stainless steel, expanding
Outokumpu Circle Green® product family.
Read more about our research and development
and decarbonization.
Outokumpu Annual Report 2024
11
Actions
•
Outokumpu continued to partner up with top-class
universities and institutes, technology suppliers and
customers, as well as national and international
collaborative R&D projects, like the Finnish Towards Carbon
Neutral Metals (TOCANEM) has resulted in Outokumpu
investing in biocoke.
•
Outokumpu continued to build its own biocoke
agglomeration plant in Tornio, Finland and decided to
invest EUR 40 million in building a high quality biocarbon
production plant in Germany. Currently, biocoke represents
the best available technology to decrease our direct
emissions.
•
Outokumpu announced further expansion of its Circle
Green portfolio at the end of 2024. Currently Outokumpu
offers Circle Green in six different stainless steel grades for
various environments and special surfaces.
Progress
In the end of 2024, our Circle Green
had helped our customers to reduce
50,000
tonnes of CO2 emissions
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Accelerating the green and just transition
Outokumpu’s business is based on circular economy – with up to 75% lower carbon footprint than the industry average, Outokumpu creates value to its customers
supporting them to reduce their emissions. The company has set an ambitious science-based climate target to reduce its carbon emission intensity by 42% by 2030 from the 2016
baseline. In addition, the company is committed to working towards zero safety incidents, enhancing diversity, equity and inclusion and developing a sustainable supply chain.
Furthermore, Outokumpu is committed to conducting business with high integrity. This means conducting business in an ethical and responsible way.
Environment
Social
Governance
Climate change, pollution, water,
biodiversity and circularity
Own workforce, workers in the value chain,
and affected communities
Business conduct policies and corporate
culture
Outokumpu mitigates climate change by reducing
emissions, improving energy efficiency, and by
containing a high recycled material content in its
products. In addition, the company is committed to
mitigating its impacts on water resources,
biodiversity and addressing pollution.
Respecting human rights – of our employees, workers
in the value chain, customers to local communities,
and all our stakeholders – is at the core of
Outokumpu’s strategy. We aim for zero safety
incidents, increasing diversity, equity and inclusion,
and improve pay equity.
Outokumpu is committed to conducting business
with high integrity. This means conducting business
in an ethical and responsible way. Outokumpu also
expects its business partners to follow similar ethical
standards as Outokumpu.
Key actions in 2024
Key actions in 2024
Key actions in 2024
•
A 32% reduction in the science-based target to
reduce emission intensity by 42% by 2030
•
95% of recycled materials used in production
•
Energy efficiency and use of low-carbon energy
•
Keeping the total recordable incident frequency
rate at all-time low level of 1.5
•
Improve pay equity and diversity
•
Development of due diligence and sustainable
sourcing practices
•
97% of all Outokumpu employees completed the
new Code of Conduct e-learning
•
Renewal and launch of other ethics and
compliance e-learnings
•
Other risk mitigation measures
Value creation
Value creation
Value creation
Through our low-emission stainless steel, we enabled
customers to reduce their supply chain emissions by
10 million tonnes in 2024. By having already today
up to 75% lower carbon footprint than industry
average and by innovating new low-emission
solutions with our customers, we lead the industry in
the green transition.
By providing jobs to over 8,000 people directly and
even more indirectly through its supply chain,
Outokumpu contributes to the economic and social
well-being of communities around the world.
Diversity, equity and inclusion accelerate our
innovations. We advance human rights and customer
value in our own operations and through sustainable
sourcing.
Fostering a corporate culture that is anchored in
transparency and ethical, responsible and
sustainable business practices offers employees a
safe and welcoming place to work and also enables
them to raise concerns. Outokumpu’s commitment
to conduct business with high integrity has a positive
impact also on other stakeholders of the company.
Contribution to SDGs
Outokumpu Annual Report 2024
12
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Climate action
This decade is critical in terms of
climate actions. Steel has a pivotal
role in decarbonization: while the steel
industry is a major contributor to
climate change, accounting for 10%
of global greenhouse gas emissions,
Outokumpu’s low-emission stainless
steel offers already today a solution to
reduce carbon emissions across
industries.
From commitment towards ambitious science-
based climate target aligned with the 1.5°C
degrees, to innovating and investing in low-
emission production and products,
Outokumpu offers stainless steel with up to
75% lower carbon footprint than the industry
average which helps our customer to reduce
their overall emissions.
Together with its customers and suppliers,
Outokumpu accelerates the green transition
across various hard-to-abate industries.
Read more about our decarbonization (E1).
Outokumpu Annual Report 2024
13
Reduce emission
intensity across
direct, indirect and
supply chain by
42%
by 2030 from the
2016 baseline
Targets
Progress
Actions and recognitions
Emission
intensity
reduced by
32%
by the end of 2024
from the 2016
baseline
•
Outokumpu was recognized as a Climate Leader by Financial
Times as the only stainless steel producer and by Ecovadis
among top 1% of companies and assessed with Platinum
rating. We also received the Highly Commended recognition in
the carbon reduction category at The World Sustainability
Awards 2024, a Leading Company Award at the ESG
Transparency Awards 2024, and the ICDA Sustainability Award.
•
Outokumpu participated in the UN General Assembly and
Climate Week in New York in September and took forward the
message of the pivotal role of stainless steel in accelerating
the green transition.
•
Kemi mine is targeting to become world's first carbon-neutral
mine by end of 2025. During 2024 Outokumpu worked to
replace shotcrete with a low-carbon alternative, to replace
propane heating with electric heaters in the ventilation of the
underground mine. The work continues to replace natural gas
with biogas, identify more sustainable alternatives for rock
support material and utilize Outokumpu's own slag in mine
filling emphasizing circular economy.
In 2024, our customers
avoided CO2 emissions were
10
million tonnes corresponding to 51
million train trips around the world.
600
GWh’s improvement
in energy efficiency
by the end of 2024
from Jan–Sept 2022
391
GWh’s improvement
in energy efficiency
by the end of 2024
from 2022
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Circular economy
Outokumpu’s business is based on
the circular economy: our stainless
steel products are made of over 95%
recycled material content.
In the production of Outokumpu stainless
steel, besides clean energy, the high amount
of use of recycled raw materials enables our
up to 75% smaller carbon footprint, compared
to the industry average.
Our mills can be considered as significant
recycling centers: in 2024, we recycled a total
of over 2 million tonnes of recycled metals.
The Inner Circle initiative was launched in
2023, in collaboration with customers and
suppliers alike. Through the initiative,
customers are connected to scrap suppliers
to demonstrate a closed loop for low-emission
stainless steel.
Read more about Outokumpu’s resource use and
circular economy (E5).
Outokumpu Annual Report 2024
14
Recycled material
content over
90%
each year
Recycled material
content in 2024
95%
Slag utilization rate
88.6%
in 2024
Every year,
Outokumpu processes over
2 million tonnes
of recycled metals, equivalent to
the weight of 321 Eiffel towers.
Targets
Progress
Actions
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Protecting the environment
Outokumpu is committed to protecting
the environment. Besides mitigating
emissions and accelerating circularity,
the company focuses on reducing its
impacts on biodiversity, water
resources and addressing pollution.
As stainless steel production may have
impacts on nature, Outokumpu prevents,
controls and mitigates pollution to protect
people and the environment. Producing
stainless steel also has an impact on water
resources. Outokumpu uses water for cooling
and other operational activities – mainly
surface water from rivers and the sea,
including rainwater. The company measures
the withdrawal of water, recycles it as much
as possible, and appropriate treatments are
applied before discharges.
In addition, we contribute to mitigating
biodiversity loss through the reduction of
carbon emissions and we reduce virgin
resource material dependency, by using over
90% recycled raw materials in our production.
Read more about our pollution (E2), water (E3) and
biodiversity (E4).
Outokumpu Annual Report 2024
15
Pollution: Outokumpu carried out investigations to
improve wastewater treatment.
Water resources: Outokumpu prioritized water efficiency,
recycling water and treating wastewater, and monitored
water use consistently and comprehensively.
Biodiversity and ecosystems: Outokumpu developed
biodiversity management plans.
Waste: extracting valuable metals from slag and dust,
safe and responsible disposal of waste, regular audits.
Actions
Closed mines
•
Before focusing on production of stainless steel,
Outokumpu operated several mines across Finland and
elsewhere. Outokumpu still operates the only chrome
mine in the European Union in Kemi, but Outokumpu puts
significant efforts in assessing and taking after-care
measures at the old mines annually.
•
In 2024 the company continued to monitor the safety and
the environmental situation, and executing maintenance
work at the closed mines. Comprehensive environmental
studies were done at Enonkoski and Vihanti in Finland and
smaller studies at several other sites. The work will
continue ensuring safety, monitoring of environmental
impacts, execution of complementary restoration
measures and engagement with the local stakeholders.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Safety first
Safety of our people is our first priority.
Safety comes first in our operations,
and in 2024 we kept our safety
performance at the same record low
level as last year, positioning the
company as the leader of its industry.
Our long-term vision is zero accidents,
as every incident is too much.
Strong safety performance correlates with
improved operational efficiency and quality,
while good health and well-being of the
personnel are essential values at Outokumpu
on their own.
Our safety principles are: safety before
volumes, safety starts with me, no shortcuts
and no repeats.
Read more about our safety and well-being (S1).
Outokumpu Annual Report 2024
16
Targets
Progress
Actions
3rd
safety robot utilizing
AI, called Jokkeri,
joined our
employees in Tornio
From 2016 to 2024,
recordable incidents have
fallen by
83%
Group TRIFR target
for 2024
<1.6
total recordable
incidents per million
working hours
Group TRIFR result
for 2024
1.5
total recordable
incidents per million
working hours
Long-term safety progress
255,162
preventive safety
actions (safety
behavior
observations, hazards
and other actions), up
by 5% since 2023
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Our people
At Outokumpu, people and their
expertise are at the core of the
business to produce stainless steel in
a safe and sustainable way. They
contribute to our success by operating
the machinery, systems and
processes, and also by striving for
continuous improvements and
innovation.
We believe that diversity of employees from
different backgrounds and cultures are drivers
for innovation and attracting talent.
For Outokumpu, diversity is about valuing
differences. Equity ensures employees’ equal
access to opportunities, and inclusion fosters
employees’ feeling of being welcome.
Focusing on diversity, equity and inclusion
benefits employees and the business alike.
Read more about our own workforce (S1).
Outokumpu Annual Report 2024
17
Diversity
+100
diverse leaders by
the end of 2025
Minimum
30%
diverse leaders in all
management teams
by the end of 2025
Targets
Progress
Actions
+55
diverse leaders by
the end of 2024
30%
diversity in 10/12
management teams
by the end of 2024
Women’s euro
0.996
of the men’s euro
with certification
Equity
Externally
certified
equality on
compensation
Inclusion
60%
agreement score on
inclusion in surveys
78%
agreement score
•
Outokumpu continued systematic efforts to include diverse
candidates in the last stage of our recruitment interviews.
We ranked in the top-10 companies in the Nordic Business
Diversity Index's Finland large-cap category.
•
Outokumpu actively monitored pay equity with an external
partner and ensured fairness in pay decisions. We enhanced
transparency by giving employees access to their own job
grade and pay level compared to the pay scale for their
position. We received the Fair Pay Workplace certification in
early 2024.
•
To strengthen an inclusive working culture, we launched a
team dialogue training which was rolled out to all employees
in operations.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Sustainable supply chain
In addition to our own experts, we
recognize the importance of the
workers in the value chain, from
production and delivery of raw
materials to services supporting our
operations.
Besides strengthening human rights in our
value chain through for example social audits,
socially just supply chain benefits our
customers alike. Sustainable sourcing is a
key, as we produce stainless steel for leading
brands in demanding industries around the
globe.
At the moment, we have two operational
targets: increase the suppliers who have a
sustainability rating and have a signed
commitment to Outokumpu Supplier Code of
Conduct from targeted suppliers.
Read more about our workers in the value chain (S2).
Outokumpu Annual Report 2024
18
Actions
Share of spend of
sustainability-assessed
suppliers
70%
Suppliers are assessed with
the help of EcoVadis
sustainability rating.
New
Supplier Code of
Conduct launched,
including various
language versions
4
audits or
assessments,
including three
social audits and
one human rights
impact assessment
Operational targets
100%
of targeted suppliers
have signed
commitment to our
Supplier Code of
Conduct
69%
of targeted suppliers
had signed
commitment by end
of 2024
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Collaboration with communities
As a global company with several
production sites and suppliers around
the world, we have direct and indirect
impacts on local, national and global
communities. We are committed to
respecting the human rights of
everyone who may be affected by our
activities or business relationships.
Our production sites are typically situated in
relatively small towns where we are a
significant member of the local community.
We often are among the few major private-
sector employers in the region.
We enhance the economic and social well-
being of these local communities by
employing people directly and indirectly. We
also contribute through taxes, donations and
other financial contributions as well as local
initiatives.
Read more about the affected communities (S3).
Outokumpu Annual Report 2024
19
Actions
In 2024, there were
0
cases of identified severe human
rights issues or incidents
connected to the affected
communities.
•
Further development of sustainability due diligence
process based on the identified impacts on human
rights and environment, including affected
communities related to our own operations and value
chain.
•
Outokumpu was chosen as the only steel company to
UN Global Compact Think Lab on Human Rights. The
Think Lab is a multi-stakeholder platform that shapes
thought leadership on critical sustainability issues,
such as human rights. Being part of the Think Lab on
Human Rights inspires us to contribute to this topic
and drive positive change alongside other global
leaders.
•
The Finnish NGO Finnwatch published a follow-up
status report on one of Outokumpu’s suppliers back in
2021, Vale’s Onça Puma mine in Brazil. While some of
the issues remain unsolved, Finnwatch thanked
Outokumpu for the support in solving the issue by
ordering an expert analysis of the river nearby the
mine area. Since the original report, we have made
significant steps in developing our human rights due
diligence based on the UN Guiding Principles on
Business and Human Rights. As part of this work, we
have established active and valuable engagement
with external stakeholders and are thankful for the
feedback received through this dialogue. We continue
to develop our due diligence on human rights and
environment.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Ethical and responsible business
Outokumpu is committed to
conducting business with high
integrity. This means conducting
business in an ethical and responsible
manner. We believe that every
employee at Outokumpu has a role in
making ethical choices that help to
build a world that lasts forever.
Outokumpu Code of Conduct is the core
element of Outokumpu’s group-wide Ethics
and Compliance (E&C) program. The Code of
Conduct provides the principles and rules that
all employees need to comply with and
commit to in their daily work. It is up to all of
us to do the right thing!
Read more about our governance (G1-1).
Outokumpu Annual Report 2024
20
Completion rate of
the new Code of
Conduct e-learning
by all employees
100%
Targets
Progress
Actions
Completion rate of
the new Code of
Conduct e-learning
by all employees
97%
In May 2024, our Group Ethics and
Compliance team launched the new
Code of Conduct training in a unique
way – below the surface, from the
heart of our Kemi mine.
•
The Code of Conduct e-learning was fully renewed and
launched to all employees in May 2024 making it topical and
engaging for everyone. The new training was launched in a
unique way – below the surface, at the heart of Outokumpu’s
Kemi mine. The launch was a success and 97% of the
employees completed the training in 2024.
•
All other ethics and compliance e-learning modules in the key
focus areas of anti-corruption, competition law compliance,
data protection and know your business partner were also fully
renewed and launched in 2024. These trainings are targeted at
the administrative employees and partly also to managers of
operators to further support their knowledge on ethical and
responsible business practices.
•
The Group E&C team actively continued the E&C Visibility Tour
also during 2024 and provided engaging training and shared
communications about the key focus area topics. As part of
these activities, a mandatory competition law compliance
training was organized together with the CEO for the
commercial organization globally. In addition, the Group E&C
team continued to implement various risk mitigation measures
in the key focus areas, for example through improved
processes and documentation.
•
Outokumpu is committed to foster a culture of transparency
where everyone is encouraged to speak up. Information about
the importance of raising concerns was shared through e-
learning and it was a regular topic in other training sessions as
well during 2024, also to external audiences. In addition,
speak up-related questions were asked from the employees as
part of the employee engagement surveys together with other
ethics related questions with the purpose of obtaining further
insight from the employees about the culture of integrity at
Outokumpu.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Stainless
steel market
The long-term outlook for stainless steel
consumption remains positive: there is
an increasing need for long-lasting and
sustainable solutions to the world’s most
critical challenges. Outokumpu has a
strong market position in its key
markets, Europe and the Americas.
Sustainability is the key
The main growth drivers for the stainless steel industry are
global megatrends such as urbanization, mobility,
economic and population growth as well as climate
change. These megatrends drive the demand for economic,
social, and environmental sustainability as well as the
need to develop sustainable solutions that are durable and
can be reused at the end of their lifecycle.
Outokumpu Annual Report 2024
21
The iconic Oculus, both
transportation hub and memorial
for the 9/11 in New York, is one
of Outokumpu’s references, and
is also portrayed in the new the
World As Our Showroom
campaign. It is made of carefully
selected steel alloy, known for its
strength and high recycled
content, that enables the
building's dramatic curves while
significantly reducing its carbon
footprint. The steel's durability
ensures the Oculus will stand for
generations.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Our commitment and contribution to sustainability is
embedded throughout our value chain from procurement
and production to customer deliveries. Mitigating climate
change by reducing our carbon footprint is a clear focus
area, and we aim to reduce our environmental impact
through the circular economy. This covers an energy
efficient production by using low-carbon electricity,
minimizing waste, and the use of as much recycled
resources as possible in our production.
Moving forward with Circle Green®
After the introduction of Outokumpu Circle Green® in
2022, the first of its kind globally, we constantly enlarged
the product offerings in 2024. We became the first steel
company in the Nordics with a ResponsibleSteel Certificate
for all manufacturing sites in Finland, Sweden and
Germany. Moreover, first Circle Green deliveries into the
Asian Pacific were realized.
We sell our stainless steel either directly to end-users or to
stainless steel distributors, tube makers, and processors,
such as steel service centers, who resell the products to
end-users. In 2024, around 60% of our business area
Europe’s stainless steel flat products were sold directly to
end-user customers, with the share of end-users rising from
the previous year. The remaining 40% were delivered to
distributors that stock and process stainless steel to serve
end-users. In the Americas business area, distributors have
a higher share than in Europe, 73% and 27% for end-users,
respectively.
Global market with
a few big players
Outokumpu operates in the global stainless steel market.
We are known in the market for our world-class assets,
comprehensive product portfolio and proven expertise,
which form a sound foundation for our strategy execution
and future success. In 2024, the market for cold-rolled flat
products totaled approximately 33.3 million tonnes.
Outokumpu’s global market share was approximately 3.0%.
Outokumpu is the market leader in Europe, given our cold-
rolled market share of 31%. Our market share decreased
slightly versus 2023 (33%), whereas import penetration
increased from 19% to 21%. Despite this increase, import
penetration is still below previous years’ levels.
In the USMCA region, our market share stands at 23%,
making Outokumpu the clear number two in the Americas.
In the U.S. market, Outokumpu’s share amounts to
approximately 23%. (Sources: CRU Stainless Steel Flat
Products Market Outlook November 2024, EUROFER,
Foreign Trade Statistics, American Iron & Steel Institute,
StatsCan, Canacero)
Especially in Asia, stainless steel producers were growing.
In addition to Outokumpu, the largest stainless steel
producers worldwide include Asian companies Tsingshan,
Delong, Baosteel, TISCO and POSCO, as well as European-
based Acerinox and Aperam. Global steel production
amounted to 1,839 million tonnes of which approximately
3.1% was stainless steel. (Source: CRU Nickel Monitor
January 2025, Worldsteel January 2025).
Outokumpu Annual Report 2024
22
Business area
Europe
Americas
Ferrochrome
Market share
#1, 31% (EU30) 1)
#2, 23% (USMCA) 2)
2% 3)
Production
Tornio, Finland
Avesta, Degerfors and Nyby,
Sweden
Dahlerbrück, Dillenburg and
Krefeld, Germany
Calvert, Alabama, the U.S.
San Luis Potosí, Mexico
Kemi and Tornio, Finland
Largest customer segments
Distributors
Metal processing and tubes
Automotive
Consumer Goods
Distributors
Appliances
Automotive
Pipes and tubes
Stainless steel producers
Main competitors
Aperam, Acerinox, Acciai
Special Terni
NAS; Cleveland Cliffs (AK),
ATI
Glencore, Samancor, ERG
1) EUROFER. 2) American Iron & Steel Institute, StatsCan, Canacero. 3) ICDA.
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Sales of customer segments
9%
15%
4%
18%
2%
8%
4%
40%
Appliances
Automotive
Architecture, building & construction
Metal processing & tubes
Chemical, petrochemical
Heavy industries
Other operations
Distributors
Stainless steel deliveries by business area, %
71%
29%
Europe
Americas
In 2024, the global stainless steel production capacity of
slabs remained stable on 2023-levels at 72.8 million
tonnes. The global utilization rate for cold rolled products
was calculated at around 75% in 2024, increasing from
71% in the previous year. Assumptions on global apparent
consumption of stainless steel were revised constantly
over the year to apply to slowing global stainless steel
demand and changing economic circumstances. (Source:
CRU Stainless Steel Flat Products Market Outlook
November 2024)
As the production of stainless steel is capital intensive,
producers generally aim for continuously high capacity
utilization in order to maintain and improve profitability.
Several Asian producers also manufacture carbon steel,
which can be a substitute product for stainless in some
cases, while European stainless steel manufacturers focus
on the production of sustainable material.
Major stainless steel producers
Million tonnes
2025
2024
Tsingshan
10.7
10.7
Delong
5.5
5.5
Baosteel
5.2
5.2
TISCO*
4.5
4.5
POSCO*
3.3
3.3
Acerinox
3.3
3.3
Outokumpu
3.0
3.0
Guangxi
3.0
3,0
Jindal
2.9
2.9
Aperam
2.8
2.8
Source: Stainless steel production capacity of slabs, CRU Stainless
Steel Flat Products Market Outlook Capacity Database October 2024.
* Subsidiaries of Baowu Steel
Navigating through
a year of challenges
In 2024, the stainless steel market had to navigate
through a series of significant events and trends that
shaped its trajectory across different regions. The year was
marked by a complex interplay of supply chain disruptions,
fluctuating demand, and strategic adjustments by key
players in the industry.
The European stainless steel market began the year with
significant challenges. Strikes at major mills, including
Outokumpu in Finland and Acerinox in Spain, led to severe
supply shortages. These disruptions, combined with high
raw material costs, initially drove prices up. The white
goods sector showed slight improvement, while demand in
the construction and automotive sectors remained flat.
In the U.S., the market experienced a stable start with
base prices holding steady. Demand was consistent across
key industries such as shipbuilding and chemical
processing. Meanwhile, in Asia, particularly China, prices
increased due to higher raw material costs and strong
futures contracts. However, demand remained subdued
ahead of the Chinese New Year.
As the second quarter unfolded, European stainless steel
prices continued to rise. The ongoing supply shortages
from the strikes at Outokumpu and Acerinox were the main
drivers of this increase. Despite high raw material costs,
the market saw a slight improvement in the white goods
sector. However, stock levels remained low as supply was
expected to recover with the resumption of operations at
the affected mills.
In the U.S., demand remained stable, particularly in
shipbuilding and chemical processing. As supply in China
was strong and demand remained stable, mills cut
production in response to negative margins, and exports
increased significantly.
Outokumpu Annual Report 2024
23
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Stainless steel and nickel prices in 2024
Stainless steel price*, EUR/t
14 15 16 17 18 19 20 21 22 23 24
0
2,000
4,000
6,000
Source: CRU Stainless Steel Flat Products Monitor, January 2025
* Stainless steel reference price for cold rolled 304 2mm sheet in
Europe.
The third quarter saw a shift in the European market as
stainless steel prices began to decline on weak demand,
increased domestic supply, and competitive imports.
Material entering the European market had been ordered
during the supply disruptions in the second quarter to
secure supply over summer and in the third quarter.
Despite low inventory levels, buying activity remained
subdued, particularly in the automotive and construction
sectors.
Demand in the U.S. softened, leading to increased
competition among service centers. Short lead times and
competitive import offers from Asia influenced market
dynamics. In China, weak demand and strong supply
continued to weigh on the market. The automotive and
construction sectors struggled, leading to production cuts
and negative margins for mills.
European demand remained weak over the fourth quarter,
partially impacted by the stagnant automotive industry and
home appliance sectors. Competition among sellers
intensified, and European producers intended to balance
the market with production adjustments.
Nickel price, USD/t
13 14 15 16 17 18 19 20 21 22 23 24
0
10,000
20,000
30,000
40,000
Source: LME settlement, monthly average prices.
In the U.S., manufacturing activity remained low despite a
seasonal uptick in demand, with strong demand in energy-
related activities and shipbuilding, but other sectors
showed pessimistic demand. Market sentiment in China
improved initially due to government stimulus, but weak
demand and oversupply led to a bearish outlook, with
buyers remaining cautious and low interest in restocking
before Chinese New Year.
Throughout 2024, stainless steel prices experienced
significant fluctuations. In Europe, prices for CR 304
stainless steel rose sharply in the first half of the year, due
to supply shortages. However, the second half saw a
steady decline, with prices dropping due to low demand
and fierce competition between European producers. In the
U.S., prices remained stable initially but declined in the
latter half of the year due to lower alloy surcharges. In the
same time, prices in Asia were volatile, with initial
increases followed by declines due to weak demand and
strong supply. Overall, 2024 was marked by a downward
trajectory in stainless steel prices across all major regions,
reflecting the broader market challenges and economic
conditions.
Regional distribution of stainless steel apparent
consumption in 2024
EMEA
APAC
Americas
Source: CRU Stainless Steel Flat Products Market Outlook
November 2024.
Global apparent consumption of stainless steel flat
products amounted to 43.0 million tonnes in 2024,
growing +4.1% vs. 41.3 million tonnes in 2023. Demand
in EMEA and APAC increased by 5.3% and 4.4%,
respectively, while in the Americas it decreased by 1.4%.
(Source: CRU Stainless Steel Flat Products Market Outlook
November 2024)
Outokumpu Annual Report 2024
24
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Outlook 2025: modest growth
amid persistent risks
In 2025, the global economy is expected to grow steadily
but slightly below trend. Europe faces economic struggles,
with weak consumer sentiment and a struggling
construction sector. The US is on track for a soft landing,
with steady growth in services and recovering
manufacturing. China is to maintain a steady GDP growth
at 4.5%, but structural issues are to persist. Industrial
production and construction are set to improve, but
geopolitical uncertainties, particularly trade tensions and
protectionism, pose significant risks to economic stability.
Europe’s economic outlook is modest, with GDP growth
expected at 1.4%, industrial production recovering at 1.6%,
and core inflation remaining above target. However,
significant risks include geopolitical uncertainties,
particularly trade tensions and protectionism, which could
disrupt economic stability. Additionally, structural
challenges in key sectors and potential political instability
within the region pose further threats to sustained growth.
The demand outlook for the U.S. in 2025 is optimistic,
driven by expected growth in industrial production and
fixed capital investments. In contrast, China’s demand
outlook remains cautious due to structural economic
challenges and potential trade tensions.
While stainless steel demand is expected to recover
gradually, prices are expected to see a moderate increase
in 2025, but not a significant surge.
(Source: CRU Stainless Steel Market Outlook November 2024, CRU
Global Economic Outlook December 2024)
Outokumpu Annual Report 2024
25
Annual review
This is Outokumpu
Year 2024 in review
Performance in 2024 and over the years
Our impact
CEO’s review
Sustainability highlights
Stainless steel market
Financial year 2024
Governance and remuneration
Financial year
2024
In the midst of challenging market
conditions, Outokumpu was able to
maintain a healthy balance sheet
and a strong market position.
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Review by the Board of Directors and
Financial Statements 2024
Following the Corporate Sustainability Disclosure Requirement, Outokumpu’s Review by the Board of Directors
also includes its Sustainability statement, followed by Financial Statements.
Outokumpu Annual Report 2024
27
Review by the Board of Directors
27
Review by the Board of Directors
28
Sustainability statement
40
Group key figures
152
Financial Statements
161
Consolidated statement of income
163
Consolidated statement of comprehensive income
164
Consolidated statement of financial position
165
Consolidated statement of cash flows
166
Consolidated statement of changes in equity
167
Notes to the consolidated Financial Statements
168
Parent company Financial Statements, FAS
229
Signatures of the Review by the Board of Directors and
Financial Statements
242
Auditor’s reports
243
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Review by the Board
of Directors
In 2024, Outokumpu’s adjusted EBITDA amounted to EUR 177 million (EUR 517 million),
reflecting a weaker part of the global stainless steel cycle. Lower profitability was mainly
driven by the challenging market environment, including a high import pressure, in both
Europe and North America but also the negative EUR 60 million impact of the four-week
political strike impacting our operations in Finland in the first half of the year.
Throughout the year we successfully continued our profit improvement actions and further
accelerated measures when the market environment started to turn even more difficult.
Despite the changing conditions, we maintained our strong market positions in both of our
main markets, Europe and North America.
In 2024, demand was weak and our stainless steel deliveries decreased significantly
reaching their lowest level in history. Deliveries were even lower than during the pandemic
and this was mainly driven by an adverse development in business area Europe. Even
though our deliveries in business area Americas increased, they still remained at a low
level. Throughout the year both of our stainless steel businesses were faced with a
significant pressure coming both from lower stainless steel prices as well as tighter scrap
market. We managed our net working capital efficiently and despite the challenges, kept
our net debt at a low level. At the end of the year, Outokumpu remained the stainless steel
producer with the strongest balance sheet in the industry. This, together with our good
liquidity, provides us with a solid starting point for the new year.
Our business area Europe’s adjusted EBITDA amounted to EUR 58 million (EUR 148
million), mainly due to weaker market conditions and the impacts of the political strike.
Business area Americas’ adjusted EBITDA decreased also to EUR 59 million (EUR 285
million) as the market was impacted by a significant increase in imports. On the positive
side, business area Ferrochrome’s adjusted EBITDA increased to EUR 106 million (EUR 96
million), reflecting a solid demand for our low-emission European ferrochrome.
ROCE stood at -1.2% (-2.1%) in 2024, mainly due to low profitability. Net result amounted
to EUR -40 million (EUR -111 million) and earnings per share EUR -0.09 (EUR -0.26).
In 2024, we also had management changes as both President and CEO Heikki Malinen and
CFO Pia Aaltonen-Forsell decided to pursue career opportunities outside Outokumpu. In
June, Marc-Simon Schaar started as the new CFO, and in October, Kati ter Horst started as
the new President and CEO. The transition of the top management has been smooth as
they both have a long history with Outokumpu. Kati ter Horst has been a member of the
Outokumpu Board of Directors for eight years and Marc-Simon Schaar has been working for
Outokumpu Annual Report 2024
28
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
the company in various roles since 2011. Additionally, in June, Juhani Ristaniemi was
appointed as Executive Vice President, General Counsel and a member of the Outokumpu
Leadership Team and in October, Rolf Schencking started as President of business line
Advanced Materials and a member of the Outokumpu Leadership team.
The second phase of our strategy progressed well during 2024, and we have been
strengthening the core of the company by making the most of our existing assets. As part
of the current strategy phase, we aim to improve our EBITDA run-rate by EUR 350 million by
the end of 2025. The target was increased during the year as further actions were
identified and at the end of 2024, we had achieved a EUR 287 million cumulative EBITDA
run-rate improvement to combat the challenging market conditions. We are the market
leader in Europe and a strong number two in North America. We want to secure those
positions. As part of our strategy, we also aim to keep our net debt to adjusted EBITDA
ratio below 1.0 in normal market conditions. At the end of 2024, our net debt to EBITDA
ratio was 1.1 even though market conditions were far from normal. In addition, we have an
increased focus on shareholder returns and an ambitious aim to reduce our emissions.
In 2024, we kept our leadership position in sustainability and maintained our world-class
safety performance. By the end of the year, we had successfully reduced our emissions by
32% compared to year 2016, ahead of our SBTi climate target. As a critical enabler, our
share of recycled material content remained at a high level of 95%. With these actions, we
supported our customers to reduce their emissions by 10 million tonnes with our low-
emission stainless steel. We also proceeded with our plans to reduce our direct emissions
and replace fossil coke with a bio-based solution and decided to invest in a biocarbon plant
in Germany. In 2024, Outokumpu was also recognized as a Climate Leader by the Financial
Times, and received an EcoVadis Platinum rating.
The year 2024 was challenging for Outokumpu in the weak economic environment and
uncertain geopolitical situation. However, with our strong financial position and a positive
long-term outlook for the global stainless steel industry, we look confidently towards the
future. We are already preparing for the next market upturn and Outokumpu is in an
excellent position to take full advantage of it.
Market development
According to CRU’s latest estimates, global apparent consumption of stainless steel flat
products is expected to increase by 5.8% in 2024 compared to 2023. EMEA is estimated
to grow only by 1.1%, while apparent consumption in the Americas and APAC is assumed to
increase by 11.3% and 6.1%, respectively.
(Source: CRU Stainless Steel Flat Products Market Outlook November 2024)
Adjusted EBITDA, € million
2020*
2021
2022
2023
2024
0
300
600
900
1,200
1,500
Stainless steel deliveries, 1,000 tonnes
2020*
2021
2022
2023
2024
0
500
1,000
1,500
2,000
2,500
Net debt, € million
2020*
2021*
2022*
2023
2024
0
200
400
600
800
1,000
1,200
*Including discontinued operations
Outokumpu Annual Report 2024
29
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Results
During 2024, Outokumpu’s sales decreased to EUR 5,942 million (EUR 6,961 million).
Total stainless steel deliveries were 6% lower compared to the previous year. Deliveries in
business area Europe decreased significantly due to weaker market environment and the
political strike in Finland. Deliveries increased in business area Americas but remained still
at a low level.
Results
€ million
2024
2023
Sales
5,942
6,961
Adjusted EBITDA
177
517
Items affecting comparability in EBITDA
Loss on disposal of shares in Group companies and
businesses
-3
-26
Restructuring costs
-7
-50
Inventory revaluations
2
-20
Onerous contracts provisions
—
-7
Litigation provisions
-2
—
Environmental
-5
—
EBITDA
162
416
Operating profit (EBIT)
-51
-100
Net result for the financial year
-40
-111
Earnings per share, €
-0.09
-0.26
Diluted earnings per share, €2)
-0.09
-0.26
Adjusted EBITDA margin, %
3.0
7.4
Return on capital employed, rolling 12 months (ROCE), %1)
-1.2
-2.1
1) The balance sheet component in 2022 includes the equity component of discontinued operations.
2) The comparative data has been revised
Adjusted EBITDA was EUR 177 million in 2024 (EUR 517 million). Profitability was
impacted by notably lower realized prices for stainless steel in both Europe and Americas
and the unfavorable effects resulting from a tighter scrap market. Costs remained stable
compared to the previous year as the positive impact from lower energy and consumable
prices in business area Europe was offset by higher fixed costs and tolling fee in business
area Americas. Profitability was, however, supported by an improved result for business
area Ferrochrome.
The impact of the political strike on adjusted EBITDA was approximately EUR -60 million in
the first half of the year. Due to the political strike, the majority of Outokumpu’s stainless
steel and ferrochrome operations in Finland as well as the Port of Tornio in Finland were
shut down for four weeks. The strike also indirectly impacted the company's operations in
other countries through the disruption to internal material flows in both, Europe and
Americas.
Raw material-related inventory and metal derivative gains were EUR 3 million in 2024
(losses of EUR 44 million).
EBIT was EUR -51 million (EUR -100 million) in 2024. EBIT in the comparison period was
impacted by items affecting comparability mainly related to impairments and German
restructuring. ROCE for the rolling 12 months was -1.2% (-2.1%), mainly due to weaker
profitability. ROCE in the previous year was affected by the significant impairment booking
related to the renegotiated hot rolling contract in business area Americas at the end of
2023.
Net result was EUR -40 million (EUR -111 million) in 2024 and earnings per share was EUR
-0.09 (EUR -0.26). Net financial expenses were EUR 41 million (EUR 37 million) and
interest expenses EUR 64 million (EUR 60 million).
Cost structure, %
53%
16%
12%
19%
Raw materials
Energy and other consumables
Personnel expenses
Others
Outokumpu Annual Report 2024
30
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Adjusted EBITDA by segment
€ million
2024
2023
Europe
58
148
Americas
59
285
Ferrochrome
106
96
Other operations and intra-group items
-46
-12
Total adjusted EBITDA
177
517
Items affecting comparability in EBITDA
€ million
2024
2023
Europe
-3
-52
Americas
-8
-16
Ferrochrome
—
-3
Other operations
-4
-31
Total items affecting comparability in EBITDA
-15
-102
Total EBITDA
162
416
Strategy execution
Outokumpu’s strategy
Outokumpu launched its three-phase strategy in November 2020 and in the first phase, the
aim was to de-risk the company. The second phase started in July 2022, and this phase will
run until the end of 2025.
The third phase of the strategy will commence in 2026 and is expected to require new
investments. The company’s focus in the third phase is to strengthen its market position
further and to develop more globally diversified operations including Americas expansion,
European competitiveness, value-chain integration, and sustainability leadership along with
targeted biocoke investments.
The second phase of the strategy
In the second phase of the strategy, the aim is to strengthen Outokumpu's core. The focus
is on three key priorities: sustainability, growth from productivity, and customer-focused
steering. Outokumpu remains committed to capital discipline, limiting its capital
expenditure to EUR 600 million for the years 2023–2025, while also increasing its focus on
shareholder returns. However, Outokumpu's planned capital expenditure for the year 2025
is decreased to EUR 160 million and therefore, the planned capital expenditure for years
2023-2025 is approximately EUR 550 million.
Outokumpu's financial targets for the second phase include EUR 350 million EBITDA run-
rate improvement by the end of 2025 and maintaining net debt to adjusted EBITDA ratio
below 1.0 in normal market conditions. In May 2024, Outokumpu increased its EBITDA run-
rate improvement target from EUR 200 million to EUR 350 million to emphasize the
company’s strong focus on continuous improvement. The additional improvement is
expected to be achieved through further improvements in operational performance and
efficiency as well as by focusing on strengthening the commercial aspects of the business.
For the second phase, Outokumpu launched two customer-differentiated strategies for
business area Europe. The company aims to strengthen cost leadership in high-volume
stainless steel products and global market leadership in advanced products. In business
area Americas, the initial aim is to improve cold rolling capacity by 80 kilotons with small
investments as announced in June 2022. In business area Ferrochrome, carbon neutrality
of the Kemi mine is a strategic priority.
Decarbonization is one of the key focus areas in the second phase of Outokumpu's
strategy. The company had a target of reducing its emission intensity by 14% by the end of
2025 from the 2020 baseline. At the end of 2023, Outokumpu already exceeded this
target thanks to its high recycled material content of 95%, low-emission electricity and
operational improvements. Outokumpu continues to progress well towards its mid-term
target to reduce emission intensity by 42% by 2030 compared to 2016.
Strategy progress in 2024
In 2024, Outokumpu improved its EBITDA run-rate by EUR 101 million, bringing the
cumulative improvement to EUR 287 million since the start of the second phase. This
progress keeps the company on track to achieve its EUR 350 million target by the end of
2025.
In 2024, business area Europe contributed EUR 64 million to the EBITDA run-rate
improvement, driven by restructuring and operational efficiency improvements. Business
area Americas added EUR 21 million, supported by increased use of railways, while
business area Ferrochrome delivered EUR 16 million, leveraging sustainability-focused
innovations and green premiums.
In 2024, in business area Europe, Outokumpu maintained its focus on improving
competitiveness through its own actions amidst challenging market conditions. The
company progressed with its restructuring plans for German operations, which included the
successful closure of the Hockenheim service center, with all volumes being transferred to
other sites. The closure and transfer of the precision strip operations from Dahlerbrück to
Dillenburg remain on schedule, with fully realized production volumes at Dillenburg
expected in the first half of 2025. This centralization is anticipated to consolidate
underutilized capacity and increase European cost competitiveness over time. To secure its
market leading position and further improve its cost competitiveness, Outokumpu is also
Outokumpu Annual Report 2024
31
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
assessing how it can best optimize its commodity stainless steel production in Tornio,
Finland and Krefeld, Germany.
In 2024, the Avesta meltshop further improved raw material efficiency and cost
management by introducing alternative sources for key ingredients such as molybdenum.
These advancements build on similar improvements implemented as part of the execution
of the second phase of the strategy in the Tornio and Calvert meltshops. Collectively, these
efforts not only strengthen Outokumpu’s competitive position but also support its
sustainability goals.
Throughout the year, the commercialization of nickel alloy 825 has been a key contributor,
enhancing the company's specialty grades offering and advancing its aim to become a
global market leader in advanced products.
In business area Americas, Outokumpu is targeting to increase its cold rolling capacity by
80 kilotonnes as part of the second phase of its strategy. The company remains on track to
meet this target, having achieved a total 65 kiloton increase in capacity by the end of the
year. During 2024, capacity was increased by 10 kilotons, mainly driven by yield
enhancements in San Luis Potosí, Mexico. The continued shift toward more sustainable
logistics solutions has been another key focus area. The share of non-truck shipments for
finished goods expanded steadily, with notable progress in both San Luis Potosí, Mexico
and Alabama, U.S. These efforts have further strengthened Outokumpu's cost position and
reinforced its commitment to sustainability.
After the reporting period, on February 13, 2025, Outokumpu announced, that based on an
extensive feasibility study, the company decided not to invest in the expansion of its cold
rolling capacity in the U.S. at this point of time. On August 3, 2023, Outokumpu had
announced that it is seeking to increase its existing cold rolling capacity as part of the third
strategy phase preparations.
In business area Ferrochrome, Outokumpu is advancing its commitment to achieve carbon-
neutrality at its Kemi mine by the end of 2025. Following the 2023 transition to renewable
fuels, several innovative projects were launched in 2024, including a partnership with
Betolar Oyj to develop a low-carbon shotcrete alternative, further cutting emissions across
the mine’s value chain. The ongoing transition to the sub-level caving mining method has
also delivered significant cost savings, enhancing operational efficiency. Additional green
premiums were secured, reinforcing Outokumpu’s strong position in producing sustainable
European ferrochrome.
Smart decarbonization is one of the strategic focus areas for Outokumpu and efforts to
replace fossil raw materials with economically viable alternatives is a key element on this
journey. On December 4, 2024, Outokumpu announced its decision to invest EUR 40
million for building up a high-quality biocarbon production plant in Germany to reduce its
direct emissions.
EBIT and return on capital employed
EBIT, € million
Return on capital employed, %
2020* 2021 2022 2023 2024
-200
0
200
400
600
800
1,000
-5
0
5
10
15
20
25
30
Outokumpu has redefined its capital employed
and ROCE definitions in 2022. Comparative
information for 2021 has been restated
accordingly.
Net result and earnings per share
Net result, € million
Earnings per share, €
2020* 2021 2022 2023 2024
-200
0
200
400
600
800
1,000
1,200
-0.5
0
0.5
1
1.5
2
2.5
3
*Including discontinued operations. In 2024 and
2023 no discontinued operations impact in the
balance sheet.
Equity-to-assets ratio and debt-to-
equity ratio*
Equity-to-asset ratio, %
Debt-to-equity ratio, %
2020
2021
2022
2023
2024
-10
0
10
20
30
40
50
60
70
Capital expenditure and depreciation
Capital expenditure, € million
Depreciation, € million
2020*
2021
2022
2023
2024
0
50
100
150
200
250
Outokumpu Annual Report 2024
32
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Financial position and cash flow
Cash flow and net working capital
€ million
2024
2023
Free cash flow1)
-71
290
Change in working capital
27
54
Capital expenditure
216
170
Inventories
1,764
1,581
1) Comparison period 2023 includes discontinued operations.
Free cash flow during 2024 was EUR -71 million (EUR 290 million, including discontinued
operations). The decrease in free cash flow compared to the previous year was mainly
driven by weaker profitability and higher capital expenditure. Also, the comparison period
was positively impacted by the cash proceeds from the Long Products divestment of EUR
96 million, partly offset by higher income taxes paid. The net working capital decrease was
EUR 27 million during 2024 (a decrease of EUR 54 million).
Capital expenditure was EUR 216 million in 2024 (EUR 170 million). It includes the
CRONIMET North-East GmbH acquisition and the comparison period includes the
investments in the Canadian junior mining and development company FPX Nickel and in the
European biocarbon producer Envigas.
Inventories on the balance sheet increased during 2024 and stood at EUR 1,764 million at
the end of December (December 31, 2023: EUR 1,581 million). The inventory increase of
EUR 184 million in 2024 was driven by higher inventory volumes due to preparation for a
potential strike, partly offset by lower prices.
Financial position
€ million
2024
2023
Net debt
Non-current debt
246
359
Current debt
256
82
Cash and cash equivalents
313
502
Net debt
189
-60
Net debt to adjusted EBITDA
1.1
-0.1
Gross debt
502
441
Debt-to-equity ratio (gearing), %
5.0
-1.6
Equity-to-assets, ratio, %
63.2
63.8
Liquidity reserves, € billion
1.1
1.3
Net debt was EUR 189 million at the end of December (December 31, 2023: EUR -60
million). Gross debt was EUR 502 million (December 31, 2023: EUR 441 million). In
2024, the net debt increase of EUR 249 million was impacted by weaker profitability and
higher capital expenditure, the EUR 110 million dividend payment as well as new leasing
liabilities for the new cargo vessels.
In 2021, Outokumpu signed a deal on three cargo vessels with Langh Ship to reduce its
CO2 emissions in transport. The cargo vessels became operational during the first half of
2024, and the net debt impact at the end of December 2024 was EUR 34 million. Gearing
was 5.0% at the end of December 2024 (December 31, 2023: -1.6%).
Cash and cash equivalents was EUR 313 million at the end of December 2024 (December
2023: EUR 502 million) and overall liquidity reserves were EUR 1.1 billion (December
2023: 1.3 billion). The liquidity reserves include cash and cash equivalents and EUR 800
million of outstanding committed credit facilities, which were fully unutilized. At the end of
2024, the outstanding amount of issued commercial papers was EUR 79 million.
Outokumpu Annual Report 2024
33
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Business areas
Outokumpu has three business areas, which are also Group’s operating segments. More
information about the business areas can be found in note 2.1 in the consolidated
Financial Statements.
External sales by business area, 5,942 € million
68%
29%
3% 0%
Europe
Americas
Ferrochrome
Other operations
Capital expenditure by business area, 216 € million
54%
14%
12%
20%
Europe
Americas
Ferrochrome
Other operations
Europe
EUR million, or as indicated
2024
2023
Stainless steel deliveries, 1,000 tonnes
1,222
1,367
Sales
4,102
4,818
Adjusted EBITDA
58
148
Items affecting comparability in EBITDA
-3
-52
EBITDA
55
96
Operating capital
1,959
1,850
Return on operating capital, rolling 12 months, %
-3.0
1.5
In 2024, business area Europe’s sales decreased to EUR 4,102 million (EUR 4,818 million)
and adjusted EBITDA was EUR 58 million (EUR 148 million). Stainless steel deliveries
decreased by 11% compared to the previous year due to weaker market environment and
the political strike in Finland. In addition, profitability was negatively impacted by lower
realized prices for stainless steel and tighter scrap market.
Variable costs decreased in 2024, mainly due to lower energy and consumable prices. The
impact of the political strike in Finland in the first half of 2024 was approximately EUR -40
million. Raw material-related inventory and metal derivative gains were EUR 3 million in
2024 (losses of EUR 27 million). Business area Europe’s return on operating capital was
-3.0% at the end of 2024 (1.5%) due to low profitability.
In 2024, apparent consumption in EMEA increased by 5.3% compared to 2023 (Source:
CRU Stainless Steel Flat Products Market Outlook November 2024). EU cold-rolled imports
increased to a level of 21% from the previous year's level of 19% (Source: EUROFER,
January 2025).
Americas
EUR million, or as indicated
2024
2023
Stainless steel deliveries, 1,000 tonnes
596
552
Sales
1,707
1,892
Adjusted EBITDA
59
285
Items affecting comparability in EBITDA
-8
-16
EBITDA
51
270
Operating capital
574
594
Return on operating capital, rolling 12 months, %
4.2
25.8
In 2024, business area Americas’ sales were EUR 1,707 million (EUR 1,892 million) and
adjusted EBITDA decreased to EUR 59 million (EUR 285 million). Stainless steel deliveries
increased by 8% compared to the previous year. Profitability was negatively impacted by
notably lower realized prices for stainless steel in the U.S. and Mexico and tighter scrap
market.
Outokumpu Annual Report 2024
34
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
In 2024, fixed costs increased, and were impacted by a higher tolling fee and maintenance
work. The higher tolling fee is due to the renegotiated hot rolling agreement with AM/NS
that came into effect on January 1, 2024. The impact of the political strike in Finland in the
first half of 2024 was approximately EUR -10 million. Raw-material related inventory and
metal derivative losses were EUR 3 million in 2024 (losses of EUR 1 million). Business area
Americas’ return on operating capital was 4.2% at the end of 2024 (25.8%).
In 2024, the apparent consumption increased by 11% compared to 2023. The share of
cold-rolled imports into the US increased to 25% compared to a level of 22% in 2023. The
share of cold-rolled imports into North America increased to 34% from a level of 31% in
2023. (Source: American Iron and Steel Institute, AISI).
Ferrochrome
EUR million, or as indicated
2024
2023
Ferrochrome deliveries, 1,000 tonnes
374
355
Sales
469
467
Adjusted EBITDA
106
96
Items affecting comparability in EBITDA
—
-3
EBITDA
106
93
Operating capital
863
894
Return on operating capital, rolling 12 months, %
5.5
5.0
In 2024, business area Ferrochrome’s sales were EUR 469 million (EUR 467 million), while
adjusted EBITDA increased to EUR 106 million (EUR 96 million). Ferrochrome deliveries
increased by 5% compared to the previous year. Lower ferrochrome price and the
approximately EUR 7 million mine tax had a negative impact on result, while profitability
was supported by significantly decreased variable costs, mainly due to lower electricity and
reductant prices.
The impact of the political strike in Finland in the first half of 2024 was approximately EUR
-10 million. Business area Ferrochrome’s return on operating capital was 5.5% at the end
of 2024 (5.0%)
Research and development
Outokumpu’s research and development (R&D) function provides leading technical
expertise and know-how and supports both external and internal stakeholders in value
creation by developing innovative products, technologies and solutions for a sustainable
future. Also, intellectual property, including patents, has a major role in creating value
through innovations. Continuous collaboration with customers fosters a deeper
understanding of their needs, enabling the R&D function to provide all the technical
information necessary to choose the most suitable stainless steel grade for their
requirements.
Outokumpu has three R&D centers located in Avesta, Sweden, in Krefeld, Germany and in
Tornio, Finland. Outokumpu’s total R&D expenses in 2024 were EUR 15 million,
representing 0.2% of the annual sales (2023: EUR 14 million and 0.2%). In addition to
direct R&D expenses, Outokumpu has also various strategic initiatives and development
projects.
In 2024, to strengthen Outokumpu’s product portfolio, an innovative method was created
to enable the extension of the dimensional range of the company’s quarto plate offering
especially for high-alloyed stainless steels and nickel-base alloys. This Wide & Thin
development was selected by the Outokumpu Leadership Team as the winner of the annual
Innovation Award. Outokumpu values a culture of continuous improvement, and in 2024,
Outokumpu Corrosion academy was launched, providing valuable insights and practical tips
regarding corrosion related challenges across various industries. In addition, a new
stainless steel technical training was introduced to improve the overall technical
competence of the organization.
Outokumpu entered the metal powder business in 2023 with a new metal powder plant in
Germany offering highly sustainable solutions by using recycled stainless steel as raw
material. In 2024, the company further developed its offering to capitalize the increasing
demand for metal powders used in Additive Manufacturing, with a focus on new, high-
quality powders.
As part of Outokumpu’s commitment to decarbonize its operations and supply chain, the
R&D work related to the biocoke investment and its implementation continued.
Furthermore, side streams like slags were investigated to be used for carbon capture and
storage (CCS) utilizing our internal off-gases. In addition, Outokumpu participates with other
Finnish industrial companies and universities in the Towards Carbon Neutral Metals 2
(TOCANEM2) joint research project. This project supports Outokumpu’s transition towards
carbon neutrality and is funded by the innovation funding center Business Finland.
Circular economy is another key focus area for the R&D function. In 2024, Outokumpu
maintained its competitive edge in the Circle Green product line with industry-leading scrap
ratios. Circle Green has up to 93% lower carbon footprint compared to the global industry
average and it was the first innovation of its kind on a global scale with such a low carbon
footprint and with a product-specific footprint calculation for every delivery. Today, more
than 30 leading companies from various industry sectors in Europe and Asia are using this
solution to reduce their carbon footprint. The Circle Green portfolio includes ten different
grades and Outokumpu will continue to extend the offering.
Risks and uncertainties
Outokumpu is exposed to various risks and uncertainties that may have an adverse impact
on its business and operations. However, the company has taken prompt measures to
manage and control these risks.
Outokumpu Annual Report 2024
35
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
The development of the global economy, geopolitical tensions, trade policies and the
continued war in Ukraine all expose Outokumpu to risks and uncertainties within its
operating environment. The main uncertainties in the global economy relate to the
development of the trade defense measures, slow global economic growth, inflation, high
interest rates, and continued uncertainties concerning China’s economy. Possible further
escalation of geopolitical tensions and conflicts, especially in the Middle East, could
increase disruptions in the global supply chains. The consequences of these disruptions
could impact Outokumpu's operating environment, business, and stainless steel demand.
Outokumpu is exposed to continued high energy price risk sensitivity owing to adverse
geopolitical events. Any severe disruption or events in the natural gas supply could affect
the price or availability of Outokumpu’s operations in Europe.
For the year 2025, Outokumpu’s energy portfolio has been hedged for two thirds of the
estimated consumption. Possible increases in the cost of electricity would mainly affect the
Ferrochrome business area due to the high electricity consumption in ferrochrome
production. The activities implemented in relation to electricity optimization enable the
mitigation of peaks in spot market electricity prices.
Cyber security threats, trade disruptions with raw materials and dependencies on critical
suppliers and machinery expose Outokumpu to the risk of operational disruption and
additional costs.
Outokumpu does not purchase any scrap or nickel of Russian origin for its operations. At
the end of 2024, the remaining indirect supply from Russia for a very limited amount of raw
material was terminated.
The company remains exposed to risks related to volatile metal prices, especially nickel.
Volatile metal prices may impact Outokumpu’s result, among other financial risks.
The outcome of the U.S. presidential elections has increased the likelihood of further trade
defense measures, influencing possibly the global trade flows. In June 2024, the EU
decided to extend the safeguard measures by two years until June 2026. The purpose of
these measures is to mitigate the surge of imports. In May 2024, as a result of the anti-
circumvention investigation on cold-rolled stainless steel from Indonesia, the EU imposed
duties on some producers in Taiwan, Turkey, and Vietnam. In December 2024, the EU
initiated a review of the safeguard measures, with the purpose of improving the functioning
of the measures with some adjustments. This review will be completed by the end of March
and possible changes imposed from April 1, 2025 onwards.
For more information on Outokumpu’s risks, please refer to the Annual Report for 2024 and
the Notes to the 2024 Financial Statements.
Significant legal proceedings
Dispute over payment of wages in the US
On July 16, 2018, a class of plaintiffs, eventually consisting of 278 former and current
Outokumpu Calvert mill employees, brought a suit against Outokumpu Stainless USA, LLC
in the U.S. federal district court. The plaintiffs alleged that Outokumpu failed to pay full
wages for regular work and overtime work they performed. The district court entered a
default judgment against Outokumpu in 2021 with respect to liability without Outokumpu
having the opportunity to argue the merits of the allegations and subsequently found
Outokumpu liable to the plaintiffs for approximately USD 13 million in the aggregate, plus
attorney’s fees. Outokumpu appealed these decisions at the time. The Court of Appeals
has on October 11, 2024 upheld the district court’s decisions. On November 1, 2024,
Outokumpu filed a petition for a rehearing before the court of appeals which the court of
appeals denied on December 6, 2024. The case has been returned to the district court for
a final determination of the amount of Outokumpu’s liability. Outokumpu has a USD 18.9
million provision in respect of this matter.
Claim in Germany related to expired lease agreement
On January 19, 2018, Outokumpu Nirosta GmbH was served with a claim in the district
court of Krefeld for declaratory judgement by the owner of a warehouse in Krefeld that
Outokumpu had leased until the end of 2016. The claim relates to a dispute over the
responsibility for the maintenance and repair of the warehouse. The claimant has later in
the process specified the claim and is seeking a payment of EUR 19 million. On May 4,
2022, the court issued a ruling covering only the merits of the claim. Said ruling was in
favor of the claimant and was appealed by Outokumpu in the court of appeal. On June 15,
2023, the court of appeal cancelled the said ruling, and referred the dispute back to the
lower court where the matter is still pending. Outokumpu is of the view that the claims
asserted against it are without merit and continues to defend against them. Appropriate
provisions are in place.
Outokumpu cleared out of arbitration proceedings regarding
Fennovoima
Outokumpu Corporation was joined in 2023 into arbitration proceedings over a dispute
between Fennovoima Oy and Rosatom entities related to the termination of an EPC
(Engineering, Procurement and Construction) contract for a nuclear power plant. On
February 14, 2025, Outokumpu received the Arbitral Tribunal’s confirmation that it does
not have jurisdiction to adjudicate claims brought by RAOS Project Oy and JSC Rusatom
Energy International (JSC REIN) against Outokumpu. The arbitration proceedings with
respect to Outokumpu therefore have ended. The arbitration between Fennovoima Oy and
Rosatom entities related to the termination of the EPC (Engineering, Procurement and
Construction) contract for a nuclear power plant continues. Outokumpu Corporation is not a
party in the said dispute.
Outokumpu Annual Report 2024
36
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Shares and share capital
On December 31, 2024, Outokumpu’s share capital was EUR 311 million and the total
number of shares was 456,874,448. At the end of December, Outokumpu held
33,188,820 treasury shares. The average number of shares outstanding was 424,237,776
in 2024 (435,090,240). The closing share price at the end of the period, on December 30,
was EUR 2.91.
Principal shareholders on December 31, 2024
Shares
%
Solidium Oy
70,793,208
15.50
Varma Mutual Pension Insurance Company
24,888,403
5.45
Ilmarinen Mutual Pension Insurance Company
15,360,000
3.36
The Social Insurance Institution of Finland
8,388,652
1.84
State Pension Fund
8,000,000
1.75
Elo Mutual Pension Insurance Company
6,739,000
1.48
Mandatum Life
6,125,327
1.34
OP Life Assurance Company Ltd.
5,856,308
1.28
Nordea Life Assurance Finland Ltd.
3,586,799
0.79
Oy Etra Invest Ab
2,500,000
0.55
Etola Erkki Olavi
2,000,000
0.44
Sinituote Oy
1,588,560
0.35
Laakkonen Mikko Kalervo
1,406,000
0.31
Säästöpankki Kotimaa - Equity Fund
1,291,975
0.28
Ojala Alpo Armas
1,285,860
0.28
Helander Hannu-Jukka
1,261,500
0.28
Brotherus Ilkka Johannes
1,200,000
0.26
Danske Invest Finnish Equity Fund
1,078,667
0.24
Seligson & Co Equity Fund
1,065,896
0.23
Insurance Company Fennia Life
1,013,464
0.22
Total
165,429,619
36.23
Nominee accounts held by custodian banks
87,286,559
19.11
Treasury Shares
33,188,820
7.26
Other Shareholders
170,969,450
37.42
Total
456,874,448
100.00
Share buyback program
On February 29, 2024, Outokumpu completed its most recent share buyback program of up
to EUR 50 million. In the first quarter of 2024, the company repurchased a total of
8,357,545 shares.
Through the share buyback program, Outokumpu seeks to mitigate and manage the dilutive
impact of the company’s outstanding convertible bonds. The repurchased shares will be
initially held by Outokumpu as treasury shares and may be used to meet its obligations
under the convertible bonds, maturing in July 2025. Alternatively, Outokumpu may decide
to cancel any or all of the repurchased shares and reduce its capital accordingly. The share
repurchases were funded by using funds from unrestricted equity.
Management shareholdings and
share-based incentive programs
On December 31, 2024, the members of the Board of Directors and Outokumpu Leadership
Team (OLT) altogether held 1,112,180 shares, corresponding to 0.2% of the total number
of shares.
Outokumpu has established share-based incentive programs for the OLT members, selected
managers and key employees, which include a Performance Share Plan and a Restricted
Share Pool for key employees.
In 2024, after deductions for applicable taxes, a total of 259,031 shares were delivered to
OLT members in the incentive programs based on the terms and conditions of the
programs. Outokumpu used its treasury shares for the reward payments.
The Performance Share Plan and the Restricted Share Pool Program are currently ongoing
for periods 2022–2024, 2023–2025, 2024–2026 and their continuation for the period
2025–2027 was approved by the Board of Directors in December 2024. For vesting
conditions see note 3.4 in the consolidated Financial Statements.
In 2022, Outokumpu introduced a new sustainability-focused performance criterion for the
Performance Share Plan, reflecting its commitment to continuous improvement in
sustainability. All plan periods now incorporate an earning criteria aligned with
Outokumpu’s Science Based Targets initiative (SBTi), specifically targeting CO₂ emission
reductions. For all plan periods, 80% of the remuneration is linked to return on capital
employed, with the remaining 20% tied to the CO₂ emission reduction goal.
More details on the share-based incentive programs can be found in the note 3.4 in the
consolidated Financial Statements.
Outokumpu Annual Report 2024
37
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
The members of the OLT and the Board of Directors are introduced in the Corporate
Governance Statement included in the Annual Report and at the Outokumpu website. Their
shareholdings are also presented in the Corporate Governance Statement and their
remuneration in note 3.2 in the consolidated Financial Statements. Corporate Governance
Statement and Remuneration Report are also included in the Annual Report.
Changes in management and Board of Directors
CEO Heikki Malinen decided in May 2024 to leave Outokumpu. Kati ter Horst became
President and CEO of Outokumpu on October 1, 2024. Kati ter Horst joined Outokumpu
from the Belgian company Aliaxis S.A., the world leader in fluid management systems. She
was also a member of the Outokumpu Board of Directors from 2016 to 2024.
In April 2024, CFO Pia Aaltonen-Forsell decided to pursue a career opportunity outside
Outokumpu. Marc-Simon Schaar, Chief Procurement Officer and member of the OLT since
2023, took over the role as CFO on June 1, 2024. Juhani Ristaniemi, General Counsel
since 2022, was appointed to the OLT on July 1, 2024.
Thomas Anstots, President of business line Advanced Materials, retired during the year. He
was replaced by Rolf Schencking on October 1, 2024. Rolf Schencking joined Outokumpu
from VDM, where he had held the position of Chief Technology Officer since 2018. In
November, Niklas Wass, President of business line Stainless Europe announced his
decision to leave the company.
The Annual General Meeting 2024 elected the same members of the Board of Directors as
in 2023. Kati ter Horst, however, resigned from the Board in September in order to take the
position as President and CEO on October 1.
Information presented in the notes to the Financial
Statements
Related party transactions are disclosed in the Group Consolidated Financial Statements
note 6.4 and in the Parent company’s Financial Statements notes 8, 11, 14 and 16.
Corporate governance
Outokumpu’s Corporate Governance Statement can be found at the Outokumpu website
and in the Governance and remuneration section in the Annual Report.
Annual General Meeting
Outokumpu’s Annual General Meeting 2024 was held on April 4, 2024, at the Clarion Hotel
Helsinki, Finland. The Annual General Meeting supported all the Board of Directors’ and the
Shareholders’ Nomination Board’s proposals and approved the company’s Remuneration
Report in an advisory vote. The Annual General Meeting approved the Financial Statements
and discharged the management of the company from liability for the financial year 2023.
The Annual General Meeting decided that a dividend of 0.26 euros per share be paid for
the financial year 2023. The Annual General Meeting also authorized the Board of Directors
to repurchase the company’s own shares and to decide on the issuance of shares as well
as special rights entitling to shares. In addition, the Meeting also approved the proposals
by the Shareholders’ Nomination Board regarding the members of the Board of Directors
and their remuneration.
The Annual General Meeting decided in accordance with the proposal by the Nomination
Board that the Board of Directors consists of eight (8) members. The Annual General
Meeting re-elected Heinz Jörg Fuhrmann, Kati ter Horst, Kari Jordan, Päivi Luostarinen, Jyrki
Mäki-Kala, Petter Söderström, Pierre Vareille and Julia Woodhouse as the members of the
Board of Directors. The Annual General Meeting also re-elected Kari Jordan as the
Chairman and Kati ter Horst as the Vice Chairman of the Board of Directors. Kati ter Horst,
however, resigned from the Board in September in order to take the position as President
and CEO on October 1.
Nomination Board
Outokumpu’s Shareholders’ Nomination Board consists of the representatives of the four
largest shareholders registered in the shareholder register of the company following Nasdaq
Helsinki’s first trading day in August.
The Nomination Board has been established to annually prepare proposals on the
composition of the Board of Directors and director remuneration for the Annual General
Meeting.
On August 1, 2024, the four largest shareholders of Outokumpu were Solidium Oy, Varma
Mutual Pension Insurance Company, Ilmarinen Mutual Pension Insurance Company and The
Social Insurance Institution of Finland. The Shareholders' Nomination Board comprised
Reima Rytsölä, CEO at Solidium Oy; Pekka Pajamo, CFO at Varma Mutual Pension
Insurance Company; Jouko Pölönen, President and CEO at Ilmarinen Mutual Pension
Insurance Company and Outi Antila, Director General at The Social Insurance Institution of
Finland, as well as Kari Jordan, Chairman of the Board of Directors of Outokumpu.
The Nomination Board submitted its proposals to Outokumpu’s Board of Directors on
December 18, 2024 and changes to the proposals were communicated after the reporting
period on January 7, 2025.
Outokumpu Annual Report 2024
38
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Board of Directors’ proposal for profit distribution
According to the parent company´s financial statements on December 31, 2024,
distributable funds totaled EUR 2,555 million, of which retained earnings were EUR 369
million.
The Board of Directors proposes to the Annual General Meeting to be held on April 3, 2025,
that a dividend of EUR 0.26 per share to be paid for year 2024 in two installments. This
represents a dividend of EUR 110 million.
Outlook for Q1 2025
Group stainless steel deliveries in the first quarter are expected to increase by 10–20%
compared to the fourth quarter (including the impact of a one week's strike), while pressure
on realized stainless steel prices is expected to continue during the first quarter.
Maintenance costs are forecasted to decrease by approximately EUR 10 million in the first
quarter compared to the fourth quarter.
The one-week strike in Finland in January is expected to have an approximately EUR -15
million impact on adjusted EBITDA in the first quarter.
The risk of further strikes causes uncertainty for Outokumpu's earnings development in the
first quarter. The impact of each additional week of strike is expected to be approximately
EUR -15 million on adjusted EBITDA.
With the current raw material prices, some raw material-related inventory and metal
derivative losses are forecasted to be realized in the first quarter.
Guidance for Q1 2025
Adjusted EBITDA in the first quarter of 2025 is expected to be higher compared to the
fourth quarter. This guidance includes the impact of the one-week strike.
Events after the balance sheet date
After the reporting period, on February 14, 2025, Outokumpu announced that on February
14, 2025, the Arbitral Tribunal confirmed that it does not have jurisdiction to adjudicate
claims brought by RAOS Project Oy and JSC Rusatom Energy International (JSC REIN)
against Outokumpu in arbitration proceedings over a dispute between Fennovoima Oy and
Rosatom entities related to the termination of the EPC (Engineering, Procurement and
Construction) contract between Fennovoima Oy and RAOS Project Oy in May 2022, into
which Outokumpu Corporation was joined in 2023. The arbitration proceedings with respect
to Outokumpu therefore have ended.
After the reporting period, on February 13, 2025, Outokumpu announced that it finalizes
study on emerging nuclear technology and seeks external investors to complete the project.
After the reporting period, on February 13, 2025, Outokumpu announced, that based on an
extensive feasibility study, the company decided not to invest in the expansion of its cold
rolling capacity in the U.S. at this point of time. On August 3, 2023, Outokumpu had
announced that it is seeking to increase its existing cold rolling capacity as part of the third
strategy phase preparations.
After the reporting period, on February 12, 2025, Outokumpu appointed Matthieu Jehl as
President, business line Stainless Europe and member of the Outokumpu Leadership team
as of May 26, 2025, at the latest.
After the reporting period, on January 22, 2025, Outokumpu updated its financial reporting
schedule for 2025. Outokumpu has previously announced that it will publish the January-
September 2025 interim report on October 30, 2025. The new publication date is October
29, 2025.
After the reporting period, on January 9, 2025, Outokumpu announced that the mineral
reserves in Kemi chrome mine were increased by 95%. The increase in the mineral reserves
is based on new underground drilling, proving that the ground at the mine area is rich in
chrome ore, which extends the life of the Kemi mine substantially.
After the reporting period, on January 7, 2025, Outokumpu announced a change to the
proposals of the Shareholders' Nomination Board to the Annual General Meeting 2025. As
a change to the earlier announcement, Pierre Vareille, a current member of the Board of
Directors, has subsequently notified the Shareholders' Nomination Board that he is no
longer available for re-election for personal reasons. Consequently, the Shareholders'
Nomination Board proposes that Board of Directors would consist of eight (8) members
instead of the earlier announced nine (9).
Outokumpu Annual Report 2024
39
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Sustainability statement
Outokumpu is accelerating the green transition as the global leader in low-emission stainless steel. The company’s business is based on a
circular economy: Outokumpu’s products are made from 95% of recycled materials, which it then turns into fully recyclable stainless steel. With
up to 75% lower carbon footprint than the industry average*, Outokumpu supports its customers in reducing their emissions. Outokumpu is
committed to an ambitious science-based climate target to further reduce its carbon emission intensity by 42% by 2030. In addition, the
company is committed to working toward zero safety incident; enhancing diversity, equity and inclusion and sustainable supply chain
development. Furthermore, Outokumpu is committed to doing the right thing and conducting business in an ethical and responsible way.
Outokumpu Annual Report 2024
40
General disclosures
42
Environmental information
67
Social information
110
Governance information
144
*Outokumpu’s average product carbon footprint (2024): 1.6 kg
CO₂e per kg of stainless steel based on lifecycle assessment.
Global average carbon footprint of stainless steel: (2024): 7 kg
CO₂e per kg of stainless steel. (Outokumpu’s calculation based on
data provided by CRU, worldstainless, and Kobolde & Partners AB)
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Content
General disclosures
42
Basis for preparation
43
Governance
44
Strategy
50
Impact, risk and opportunity management
55
Environmental information
67
EU Taxonomy
68
E1 – Climate change
74
Strategy
75
Impact, risk and opportunity management
77
Metrics and targets
79
E2 – Pollution
87
Impact, risk and opportunity management
88
Metrics and targets
90
E3 – Water resources
93
Impact, risk and opportunity management
93
Metrics and targets
95
E4 – Biodiversity and ecosystems
98
Strategy
98
Impact, risk and opportunity management
99
Metrics and targets
102
E5 – Resource use and the circular economy
103
Impact, risk and opportunity management
104
Metrics and targets
106
Social information
110
S1 – Own workforce
111
Strategy
112
Impact, risk and opportunity management
113
Metrics and targets
119
S2 – Workers in the value chain
128
Strategy
129
Impact, risk and opportunity management
130
Metrics and targets
137
S3 – Affected communities
138
Strategy
139
Impact, risk and opportunity management
140
Metrics and targets
143
Governance information
144
G1–1 Business conduct policies and corporate culture
145
Impact, risk and opportunity management
146
Metrics and targets
150
Outokumpu Annual Report 2024
41
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
General disclosures
Outokumpu Annual Report 2024
42
Outokumpu’s sustainability statement
has been prepared based on the results
of the double materiality assessment
considering environmental, social and
governance impacts, risks and
opportunities.
Basis for preparation
43
Governance
44
Strategy
50
Impact, risk and opportunity management
55
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Basis for preparation
General basis for preparation
of the sustainability statement
The sustainability statement was prepared on a consolidated basis. For the reporting year
2024, Outokumpu reports its sustainability information for the first time in accordance with
the requirements of the European Sustainability Reporting Standards (“ESRS”) and the
Finnish Accounting Act’s Chapter 7 on sustainability reporting.
For 2024, the first year reporting, Outokumpu makes use of the transitional provision in
accordance with ESRS 1 and comparative figures for the year 2023 are not presented.
Where information has been published in other parts of the report, Outokumpu has made
use of the incorporation by reference concept, cross references have been inserted where
relevant. (ESRS 2-BP-1-5-(a))
Scope of consolidation
The scope of consolidation of Outokumpu’s sustainability statement is the same as for the
Financial Statements. The consolidation principles primarily rely on operational control. See
also Note 6.5 Subsidiaries in Financial Statements for more information about the Group.
Associated companies, joint ventures or subcontractors are not included. (ESRS 2-BP-1-5-(b)-
(i))
Outokumpu’s subsidiaries listed in note 6.5 in the Financial Statements are exempted from
individual or consolidated sustainability reporting pursuant to Articles 19a(9) or 29a(8) of
Directive 2013/34/EU. (ESRS 2-BP-1-5-(b)-(ii))
Coverage of value chain
The sustainability statement contains relevant upstream and downstream value chain
information as required by ESRS 1. The disclosures cover Outokumpu’s upstream and
downstream value chain to varying degrees based on materiality; Outokumpu’s policies,
actions and targets; and value chain data when disclosing metrics.
When assessing impact, risks and opportunities as part of the double materiality
assessment, Outokumpu considered the entire value chain. More information on impacts,
risks and opportunities can be found below, in the section “Material impacts, risks and
opportunities and their interaction with strategy and business model” in this chapter.
Outokumpu continues to develop its policies, actions, targets and metrics covering the
value chain. (ESRS 2-BP-1-5-(c))
Omission of information and use of exemption for disclosure
Outokumpu has not used the option to omit a specific piece of information corresponding
to intellectual property, know-how or the results of innovation. (ESRS 2-BP-1-5-(d))
Outokumpu has not used the option to exempt the disclosure of impending developments
or matters in the course of negotiation, as provided for in articles 19a(3) and 29a(3) of
Directive 2013/34/EU. (ESRS 2-BP-1-5-(e))
Disclosures in relation to specific circumstances
Time horizons
As a general rule, Outokumpu applies the same definition of medium- and long-term as the
ESRS-standards: mid-term is up to five years, and long-term is more than five years. (ESRS 2-
BP-2-9-(a)) Outokumpu has not applied any additional time horizons in the reporting. (ESRS 2-
BP-2-9-(b))
Value chain estimation
Outokumpu uses both direct and indirect sources to calculate the value chain’s greenhouse
gas emissions, indirect emission factors in particular for raw materials, and other input
materials, as well as to calculate emissions from transport. Supplier-specific data is always
first priority, but if that is not available, the following estimates have been used. (ESRS 2-
BP-2-10-(a))
For metallic alloys and other input materials, Outokumpu has used a weighted average of
supplier-specific emissions and emission factors of life-cycle assessments from relevant
industry associations.
For transport, the company has used typical distances and types of transport with well-to-
wheel emissions according to the EEA report 2/2022 of the European Environmental
Agency for European transport and with the published e-factors of the US EPA for US
transport. For business travel, the company has used the greenhouse gas emissions reports
of the service provider.
Customers’ avoided carbon emissions are calculated using the difference between the
global average stainless steel carbon footprint of 7 tonnes of carbon dioxide equivalents
per tonne of stainless steel, and Outokumpu’s average product carbon footprint of 1.6
tonnes of carbon dioxide equivalents per tonne of stainless steel. Global average is
calculated as a weighted average of the regional averages for Asia, Europe, North America
and India. Outokumpu’s product carbon footprint is based on life cycle assessment and
includes both European and North American production. Avoided emissions are based on
steel amounts delivered. The calculations have been verified by a third party.
Outokumpu Annual Report 2024
43
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
In the absence of specific supplier data or industry association life-cycle-based emission
data, Outokumpu has used database data from, for example, EcoInvent, or data from
standards (ISO 14404). (ESRS 2-BP-2-10-(b))
Outokumpu has focused on strengthening collaboration with stakeholders in the value
chain to achieve the most accurate and updated data for emissions in the value chain.
When retrieving this information, Outokumpu has prioritized the data that has the most
impact on emissions. Industry associations are also seen as reliable sources, as they have
large coverage of direct information as the basis for their life-cycle assessments.
(ESRS 2-BP-2-10-(c))
Outokumpu is constantly reviewing its value chain data and updating it with new
information when available. The company’s aim is to increase the share of direct emission
data over time and thus increase accuracy. (ESRS 2-BP-2-10-(d))
Sources of estimation and outcome uncertainty
Due to the long time horizon, the investments related to the transition plan the company
has evaluated are subject to uncertainties. (ESRS 2-BP-2-11-(a)) Measurement uncertainty is
due to the viability of future techniques, as well as price development and availability of
bio-based solutions and low-emission raw materials and fuels. (ESRS 2-BP-2-11-(b)-(i)) The
assumptions are disclosed in more detail in the Climate change chapter.
(ESRS 2-BP-2-11-(b)-(ii))
Changes in preparation or presentation of sustainability information
and reporting errors in prior periods
As it is the first year of reporting based on the ESRS standards, Outokumpu does not report
any changes in preparation or presentation of the sustainability statement nor errors in
prior periods. (ESRS 2-BP-2-13-(a)) Comparative information in previous reports is based on
another standard. (ESRS 2-BP-2-13-(b)) Previous information was based on Global Reporting
Initiative (GRI). Adjustments in terms of scope, thresholds, definitions, and so on can cause
small differences in the data. (ESRS 2-BP-2-13-(c)) No material errors were identified in the
previous reporting period. (ESRS 2-BP-2-14-(a-c))
Disclosures stemming from other legislation or generally accepted
sustainability reporting pronouncements
Outokumpu’s Sustainability statement has been prepared in accordance with Corporate
Sustainability Reporting Directive (Directive (EU) 2022/2464), the European Sustainability
Reporting Standards (ESRS) as defined in the Commission Delegated Regulation (EU)
2023/2772, the Finnish Accounting Act’s Chapter 7 on sustainability reporting and EU
Taxonomy Regulation (2020/852). (ESRS 2-BP-2-15)
Related to the water analyses, Outokumpu uses the standard EN ISO 11885:2009/EPA
Method 1971, mod, EN 872:2005, accredited by Swedac ISO 17025, and in addition,
related to the circular economy ISO 14021, certified by TUV SUD 2023. (ESRS 2-BP-2-AR 2)
Incorporation by reference
Outokumpu refers to the Financial Statements for the following data:
•
net revenue in Energy consumption and mix in the Climate change chapter (ESRS
E1-5-43) and Greenhouse gas emissions in Scopes 1, 2 and 3 (ESRS 1-6-55 & AR 55),
•
list of subsidiaries in the consolidated statements in this section of Basis of preparation
(ESRS 2-BP-1-5), and
•
carbon allowances in Internal carbon pricing in the Climate change chapter (ESRS E-8 AR
65). (ESRS 2-BP-2-16)
Transitional provision
Outokumpu utilizes the transitional provision in accordance with ESRS 1: 10.2 related to
chapter 5 Value chain (E1-6-AR-45-(e ) and E1-6 AR 46-(i)), 10.3 related to presenting
comparative information and 10.4 as described in Appendix C, and do not disclose
information on Anticipated financial effects for standards E1-9, E2-6, E3-5, E4-6 and E5-6
and information on non-employee workers for standard S1-7.
Governance
The role of the administrative, management
and supervisory bodies
Composition and diversity of these bodies
At the end of 2024, the Board of Directors consisted of 7 non-executive members, while
the Outokumpu Leadership Team consisted of 9 executive members. (ESRS 2-GOV-1-21-(a))
There are no employee representatives on the Board of Directors or Outokumpu Leadership
Team. (ESRS 2-GOV-1-21-(b))
Experience of the Board of Directors and Leadership Team
The Board of Directors as a whole has broad experience of international business,
management and good governance in various sectors, including the steel, metal, chemical
and forest industries, as well as the technology, banking and automobile sectors. The
Outokumpu Leadership Team also possesses broad international competence and
experience concerning inter alia the steel, metal, forest, machinery engineering and
Outokumpu Annual Report 2024
44
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
chemical industries. The Board of Directors also has access to internal and external
stakeholders and experts with regard to sustainability-related topics. (ESRS 2-GOV-1-21-(c))
Gender and independence of the management body members
At the end of the reporting year, four out of 16 members, or 25%, of all the members in the
administrative, management and supervisory bodies were women. In more detail, two out of
seven members, or 29%, of the Board of Directors were women. In the Outokumpu
Leadership Team, two out of nine members, or 22%, were women. (ESRS 2-GOV-1-21-(d))
At the end of 2024, all (100%) members of the Board of Directors were independent of the
company and its significant shareholders, excluding one Board member, Petter Söderström,
who was independent of the company but not of one of its major shareholders. (ESRS 2-
GOV-1-21-(e))
Roles and responsibilities of the bodies
The Board of Directors and the President and Chief Executive Officer who is supported by
the Outokumpu Leadership Team, are the administrative, management and supervisory
bodies of Outokumpu responsible for the management and operations of the Outokumpu
Group with regard to sustainability matters.
The Board of Directors consisted of the following of members:
•
Kari Jordan (Chairman),
•
Heinz Jörg Fuhrmann,
•
Kati ter Horst (until September 30, 2024),
•
Päivi Luostarinen,
•
Jyrki Mäki-Kala,
•
Petter Söderström,
•
Pierre Vareille, and
•
Julia Woodhouse.
The Board of Directors has set up two permanent committees, the Audit Committee and
the Remuneration Committee, which consist of Board members and report to the Board of
Directors.
The Audit Committee was chaired by Jyrki Mäki-Kala, and the other members of the
committee were Päivi Luostarinen, Petter Söderström and Julia Woodhouse. The
Remuneration Committee was chaired by Kari Jordan, and the other members of the
committee were Heinz Jörg Fuhrmann, Kati ter Horst (until September 30, 2024) and Pierre
Vareille.
The Outokumpu Leadership Team, chaired by the President and CEO, is a reporting and
decision-making forum for steering and managing Outokumpu’s corporate agenda, including
its sustainability matters. The Leadership Team operates by virtue of the CEO’s mandate.
The Outokumpu Leadership Team consisted of
•
Kati ter Horst (President and CEO, as of October 1, 2024),
•
Heikki Malinen (President and CEO, until September 30, 2024),
•
Pia Aaltonen-Forsell (until May 31, 2024),
•
Thomas Anstots (until September 30, 2024),
•
Stefan Erdmann,
•
Juhani Ristaniemi (as of July 1, 2024),
•
Martti Sassi,
•
Marc-Simon Schaar,
•
Rolf Schencking (as of October 1, 2024),
•
Johann Steiner,
•
Niklas Wass, and
•
Tamara Weinert. (ESRS 2-GOV-1-22-(a))
The Board of Directors has responsibility for overseeing material impacts, risks and
opportunities by deciding upon the strategy and long-term targets of the Group and by
monitoring their implementation, as stated in the Board and Board Committee Charters.
Further, the Board of Directors decides on annual business plans and monitors their
implementation.
As stated in the Board and Board Committee Charters, it is also the duty of the Board of
Directors to nominate and dismiss the members of the Outokumpu Leadership Team and to
define their areas of responsibility, based on a proposal by the Board’s Remuneration
Committee.
Within the Outokumpu Leadership Team, the material impacts, risks and opportunities have
been allocated to its members to ensure further integration into the existing processes. As
set out in the Corporate Governance Policy, the decision-making authority of the
Outokumpu Leadership Team follow from the authority of the CEO, and it is the duty of this
body to run and develop the Group’s operations in line with the strategy and targets set by
the Board of Directors. (ESRS 2-GOV-1-22-(b))
In monitoring and managing impacts, risks and opportunities
As mentioned above, the Board of Directors decides on Outokumpu’s strategy and the long-
term targets of Outokumpu Group, such as its sustainability targets and strategy. The Board
of Directors also monitors their implementation and charges the President and CEO with
formulating and carrying out the necessary practices and procedures.
In addition to this, Outokumpu’s top management regularly reviews progress regarding
material impacts, risks and opportunities in various forums, as further described below.
(ESRS 2-GOV-1-22-(c))
To further ensure its continued progress within sustainability matters and to evaluate its
sustainability strategy, Outokumpu has created an internal Environment, Social, and
Outokumpu Annual Report 2024
45
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Governance (ESG) Steering Group in 2024. The ESG Steering Group also monitors,
manages and oversees impacts, risk and opportunities. The progress in set sustainability
targets is reported to the Outokumpu Leadership Team and the Board of Directors by the
Vice President – Sustainability.
In 2024, the ESG Steering Group consisted of:
•
Johann Steiner, Executive Vice President – Sustainability, Strategy and People
•
Marc-Simon Schaar, Chief Financial Officer
•
Stefan Erdmann, Chief Technology Officer, and
•
Juhani Ristaniemi, Executive Vice President – General Counsel.
Johann Steiner acts as the Chairman of the ESG Steering Group, and in addition, Heidi
Peltonen, Vice President – Sustainability, facilitates and participates in the meetings.
(ESRS 2-GOV-1-22-(c)-(i))
The Outokumpu Leadership Team acts as a reporting and decision-making forum for
steering and managing Outokumpu’s corporate agenda, including its sustainability matters,
while taking into account impacts, risks and opportunities. The Outokumpu Leadership
Team also approves transition and action plans related to sustainability.
Further, each Outokumpu business area is steered by a Business Area Board, chaired by
the CEO. The Business Area Boards consist of the CEO, the CFO, the Head of the respective
business area and selected other key members of senior management. Each individual
reports on their own responsibilities, as necessary.
The decision-making authorities of the Outokumpu Leadership Team and the Business Area
Boards follow from the authority of the CEO. It is the duty of these bodies to manage the
Group’s operations in line with the strategy and targets set by the Board of Directors.
(ESRS 2-GOV-1-22-(c)-(ii))
Outokumpu has taken into account the existing risk management processes when
conducting the double materiality assessment of assessing material impacts, risks and
opportunities. Furthermore, Outokumpu is currently developing controls to assess progress
in the targets related to material impacts, risks and opportunities. Outokumpu has
identified risks and controls related to sustainability reporting, and more information on
sustainability risks and controls can be found in the section Risk management and internal
controls over sustainability reporting, below in this chapter. (ESRS 2-GOV-1-22-(c)-(iii)
In setting targets and monitoring progress
Each business area and group function of Outokumpu is responsible for ensuring its own
operational compliance with the sustainability targets and action plans, which includes
implementing necessary measures and ensuring that monitoring, data collection and
reporting are carried out.
The President and CEO, being responsible for the company’s operational management,
regularly monitors the set targets related to the most material impacts, risk and
opportunities, together with the rest of the Outokumpu Leadership Team.
The Board of Directors approves the sustainability targets related to material impacts, risks
and opportunities and monitors how the Group is proceeding toward the targets, based on
status and action plans presented. (ESRS 2-GOV-1-22-(d))
Bodies’ access to expertise and skills with
regard to sustainability matters
Both the Board of Directors and the Outokumpu Leadership Team are regularly given
updates and presentations on sustainability-related topics from both internal and external
stakeholders and experts. In addition to this, the Board of Directors attends annual site
visits to part of Outokumpu’s operations, granting them first-hand insights and expertise of
sustainability matters.
During 2024, the Board of Directors approved updates to Outokumpu’s Corporate
Governance Policy and its Board and Board Committee Charter, by inter alia specifying the
roles of the Board of Directors and its committees in sustainability matters, including the
reporting and assurance of such matters.
In addition in 2024, the Board of Directors and the President and CEO, assessed their ways
of working and performance with support from an external service provider. One of the
objectives of the assessment was to identify strengths and potential development areas.
The assessment promotes and facilitates the Board of Directors’ and the CEO and
President’s general understanding and knowledge and ensures that relevant matters, such
as sustainability-related topics, are part of the Board of Directors’ agenda. (ESRS 2-GOV-1-23)
To gain an external stakeholder view of material impacts, risks and opportunities,
Outokumpu has created an external ESG Advisory Council to the CEO consisting of different
stakeholders to support Outokumpu in setting its ambition and roadmap in sustainability.
The ESG Advisory Council also shares insights on new sustainability topics, such as the
Corporate Sustainability Reporting Directive.
In addition to Outokumpu’s senior executives participating in the council, it consists of
three advisors:
•
Antoine Allanore, Professor of Metallurgy, Massachusetts Institute of Technology,
•
Sirpa Juutinen, Independent Sustainability Advisor, previously Partner, Sustainability and
Climate Change at PwC, and
•
Julia Woodhouse, Board member and member of the Audit Committee of Outokumpu
(ESRS 2-GOV-1-23-(a))
Outokumpu Annual Report 2024
46
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
As mentioned above, both the Board of Directors and the Outokumpu Leadership Team
receive regular updates and presentations on relevant sustainability matters, which also
relate to the material impacts, risks and opportunities. In addition to this, the Outokumpu
Leadership Team has regular strategy workshops, where sustainability topics are covered.
These updates, presentations and workshops all contribute to ensure that the Board of
Directors’ and Outokumpu Leadership Team’s skills and expertise are adequate with
respect to relevant impacts, risks and opportunities. (ESRS 2-GOV-1-23-(b))
Bodies’ roles and expertise related to business conduct
Roles
The Board of Directors and the President and Chief Executive Officer, who is supported by
the Outokumpu Leadership Team, are the administrative, management and supervisory
bodies of Outokumpu responsible for the management and operations of Outokumpu Group
related to business conduct matters.
Outokumpu has a group-wide Ethics and Compliance (E&C) Program in place. Outokumpu’s
Legal and Compliance function is responsible for managing the implementation and
continuously developing Outokumpu’s E&C Program. The Legal and Compliance function
reports to the CEO, as well as directly to the Board Audit Committee, on E&C-related
matters. E&C updates are made regularly to the Board Audit Committee. The E&C update is
made to the Board of Directors once a year.
E&C-related matters are also regularly handled by an internal Ethics and Compliance
Steering Group which consists of the Head of Controls and Internal Audit, Head of Ethics
and Compliance, and selected members of the Outokumpu Leadership Team. The E&C
Steering Group monitors the implementation and further development of the E&C Program
and gets regular updates on various ethics and compliance matters, such as Code of
Conduct, anti-corruption, competition law compliance, data privacy, know your business
partner and misconduct reporting. The E&C Steering Group also receives a regular update
on internal investigations. In addition, the Legal and Compliance function maintains a
global network of ethics and compliance contact persons and several data protection
governance bodies, which meet on a regular basis and support the implementation of the
E&C Program in the business areas, business lines and group functions.
(G1-ESRS 2 GOV-1-5-(a))
Expertise
The members of the Outokumpu Board of Directors complete the Outokumpu Code of
Conduct e-learning. In addition, the Board of Directors receives regular updates on ethics
and compliance topics.
The Outokumpu Code of Conduct e-learning is an annual mandatory e-learning course for
the members of the Outokumpu Leadership Team. There are also other mandatory, regular
E&C e-learnings courses in the fields of anti-corruption, data protection, competition law
and knowing our business partners, which are taken by the Outokumpu Leadership Team. In
addition, Outokumpu Leadership Team members receive updates and are regularly trained
on the various ethics and compliance topics by the Legal and Compliance function.
Furthermore, in addition to ethics and compliance training, there is other mandatory
training, such as health and safety training, to be taken by the members of the Outokumpu
Leadership Team. (G1-ESRS 2 GOV-1-5-(b))
Sustainability matters addressed by the
administrative, management and supervisory bodies
The ESG Steering Group follows up on the progress of material impacts, risks and
opportunities at least six times a year. Implementation of due diligence and effectiveness
of policies, actions, metrics and targets are also reviewed by the ESG Steering Group at
least six times a year.
Both the Board of Directors and the Outokumpu Leadership Team are informed about the
effectiveness of policies, actions, metrics and targets, including implementation of due
diligence, at least twice a year, starting from 2025. (ESRS 2-GOV-2-26-(a))
The Board of Directors considers impacts, risks, and opportunities as part of the company’s
strategy process. Additionally, these impacts, risks and opportunities are assessed and
discussed when reviewing and making decisions on major transactions, case by case.
Potential trade-offs associated with those impacts, risks and opportunities are considered
in the assessment, with the recognition that sustainability is a core value for Outokumpu.
The Outokumpu Leadership Team considers the impacts of the company’s actions within
the value chain, along with the risks and opportunities for its own operations, as part of
their role. They also cascade these considerations throughout their respective business
areas, functions, and operations. (ESRS 2-GOV-2-26-(b))
The Board of Directors has addressed the set targets related to the material impacts, risks
and opportunities of climate, energy, circularity, safety and diversity twice a year. The
Outokumpu Leadership Team monitors the progress for the mentioned targets regularly. In
2024, various experts presented topics related to the material impacts, risks and
opportunities during the Outokumpu Leadership Team meetings, such as:
•
updates to the Group policies,
•
decarbonization and progress on Outokumpu’s climate target,
•
health and safety,
•
development of diversity, equity and inclusion,
•
information security,
•
ethics and compliance,
•
sustainability reporting and recent regulatory requirements. (ESRS 2-GOV-2-26-(c))
Outokumpu Annual Report 2024
47
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Integration of sustainability-related performance
in incentive schemes
Outokumpu operates two incentive schemes applicable to the members of its leadership
team. The Short-Term Incentive plan (STI) supports the achievement of annual financial and
strategic targets. The Performance Share Plan (PSP) is designed to promote the
achievement of long-term strategic targets and align the management’s interests with the
those of the shareholders. (ESRS 2-GOV-3-29-(a))
In the Short-Term Incentive plan, there are two sustainability-related targets. Safety, in
terms of total recordable injury frequency rate (TRIFR) and with a target below 1.6 in 2024,
accounts for 10% of the short-term incentives for both the President and CEO and other
Leadership Team members. Diversity, in terms of the number of diverse leaders added to
the company, accounts for 10% of the short-term incentives of the leadership team
members, but not the President and CEO. The diversity target included in the Short-Term
Incentive plan is to add 100 diverse managers by the end of 2025. In the Performance
Share Plan, the sustainability-related target focuses on CO2 emission reduction in line with
Outokumpu’s SBTi commitment, for a 20% weight. (ESRS 2-GOV-3-29-(b))
Outokumpu’s remuneration policy considers sustainability-related metrics as potential
performance criteria but does not make them mandatory. (ESRS 2-GOV-3-29-(c)) The
sustainability-related variables comprises 20% of the total variable remuneration of the
management, except for the CEO for whom it is 15%. (ESRS 2-GOV-3-29-(d))
Incentive schemes for the President and CEO are approved by the Board of Directors, while
incentive schemes for other members of the leadership team are approved by the
Remuneration Committee of the Board of Directors. (ESRS 2-GOV-3-29-(e))
Climate-related considerations in remuneration
Outokumpu’s long-term incentive plan, the Performance Share Plan, includes sustainability-
related criteria for the ongoing plan periods 2022–2024, 2023–2025 and 2024–2026.
The performance share plan sets the compensation criteria for each period and is a part of
the regular compensation of top executives.
As of 2022, 20% of the Performance Share Plan for 2022-2024 awarded to the top
management is tied to a greenhouse gas emission reduction target, according to
Outokumpu’s Science Based Targets initiative (SBTi) commitment to keep global warming
below 1.5°C. Specifically, Outokumpu’s greenhouse gas emissions per tonne of crude steel
produced must reach a reduced level each year, as outlined under disclosure requirement
E1-4.
Performance assessment against climate targets
In 2024, the performance of Outokumpu’s leadership bodies has been comprehensively
assessed against the greenhouse gas emission reduction targets:
•
Achieved a 32%% reduction in greenhouse gas emissions compared to the 2016
baseline, over its target of 24% reduction for this period.
•
Against the SBTi target 2025 (1.52), the outcome of the greenhouse gas reduction was
1.42 in Performance Share Plan 2022–2024. (E1-ESRS 2 GOV-3-13)
Statement on due diligence
Outokumpu is currently developing a group-wide sustainability due diligence process
covering the company’s own operations and value chain with related adverse impacts on
people and the environment. This work builds on the previous actions that Outokumpu has
taken on mitigating its impacts on human rights and environment.
Outokumpu committed to United Nations Guiding Principles (UNGPs) on Business and
Human Rights in 2021. Since then, the company has developed its approach on human
rights due diligence accordingly. The main focus has been on the raw material supply
chains that have been identified with the most salient impacts on human rights. Further
implementation of the UNGP framework for raw material supply chains was continued in
2024 by updating the salient impacts related to the most critical supply chains. Also
environmental requirements were included in the supply chain due diligence process based
on existing and emerging legal requirements.
Regarding Outokumpu’s own operations, a thorough human rights impact assessment
together with introduction sessions for key internal stakeholders on the topic were
conducted in 2024. As part of this project, also environmental impacts related to own
operations were identified with limited scope based on the German Act on Supply Chain
Due Diligence (LkSG). The project covered Outokumpu’s all local manufacturing sites and
key supporting functions at group level.
A scheduled action plan to strengthen governance and provide support the implementation
of the next steps of the sustainability due diligence process has been defined based on the
development work done in 2024 with related findings. The sustainability due diligence
process at Outokumpu will be further elaborated for both own operations and supply chains
based on this action plan and reported accordingly in the 2025 Sustainability Statement.
(ESRS 2-GOV-4-30, 32)
Outokumpu Annual Report 2024
48
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Risk management and internal controls over
sustainability reporting
Scope, main features and components of risk management and
internal control processes
Outokumpu’s sustainability statement has been prepared in accordance with the Corporate
Sustainability Reporting Directive (Directive (EU) 2022/2464) and the European
Sustainability Reporting Standards (ESRS) as defined in the Commission Delegated
Regulation (EU) 2023/2772.
The objective of internal controls over sustainability reporting at Outokumpu is to provide
reasonable assurance that the sustainability reports are prepared in a timely manner and in
accordance with applicable laws, regulations and internal requirements.
The Risk Management Policy approved by the company’s Board of Directors defines the
objectives, approaches, and areas of responsibility in the Group’s risk management
activities. The risk management process consists of the following five core stages: risk
identification, risk evaluation, mitigation actions, control activities, and risk reporting.
Outokumpu’s internal control system is based on the Internal Control Policy and related
instructions, common ways of working with clearly defined roles and responsibilities, and
processes, which are run on a digital platform. This system of internal controls has five
components: control environment, risk assessment, control activities, information and
communication, as well as monitoring activities. Outokumpu’s system of internal controls is
based on the COSO Internal Control Framework (2013) and is in use across the Group.
The Board of Directors is responsible for ensuring that the company’s internal controls are
appropriately organized. The CEO, supported by executive management, is responsible for
implementing and maintaining an efficient system of internal controls. The ESG Steering
Group plays a significant role in managing sustainability in Outokumpu. Specifically for
sustainability reporting, the ESG Steering Group reviews the sustainability disclosure,
assesses reporting-related risks and monitors risk mitigation, including control activities.
The Group’s internal control function supports and develops effective internal control
management processes and is responsible for control testing.
The control activities target the prevention, discovery and correction of potential errors and
deviations in reporting. Control activities also aim to ensure that authorization structures
are designed and implemented in such a way that incompatible tasks are segregated.
Control activities are performed at different organizational levels and at various stages
within the reporting process.
Sustainability-related aspects, including reporting-related risks and controls, continued to
be merged with the existing procedures and practices. Management monitors related
achievements. Risks or threats are managed through regular assessments, reporting and
status reviews. (ESRS 2-GOV-5-36-(a))
Risk assessment approach
Risk assessment involves a dynamic and iterative process identifying and evaluating risks
to achieve predefined objectives, and it provides the foundation for determining how risks
will be managed. The risks related to sustainability reporting are managed according to
Outokumpu’s risk management policy and practices. The risks related to sustainability
reporting are identified and evaluated in risk workshops or similar, addressing risks for the
most relevant parts of the sustainability reporting process. (ESRS 2-GOV-5-36-(b))
Main risks identified in sustainability reporting and their mitigation
Outokumpu has identified and evaluated sustainability reporting-related risks. The risks
relate to the accuracy and timeliness of the reporting, as well as to the reporting process.
These risks are assessed and reviewed once a year at a minimum. In the risk assessment,
the impact of risk is evaluated using financial and non-financial impact areas, as well as
the likelihood of the risk occurring. The risks are mitigated by designing and implementing
the reporting process and working practices in a manner, which enable controlled
sustainability reporting, as well as regular execution of selected internal controls. Control
activities for sustainability reporting consist of measures to ensure that sustainability
information is accurate and reported in a timely manner. The main control activities consist
of reviewing sustainability information in the reporting process to ensure completeness and
correctness of the reported data. In addition, the monitoring of embedded system controls
and the effectiveness of related IT general controls are equally important, as well as regular
system access reviews. During 2024, Outokumpu implemented one new IT system for
environmental reporting and extended the use of another IT system to manage
sustainability reporting in an efficient manner. (ESRS 2-GOV-5-36-(c))
For both risk and internal control management, sustainability reporting related items are
incorporated into Outokumpu’s common processes and practices. Clear roles and
responsibilities are assigned to individuals according to the governance models, which also
defines who needs to react to risk assessment results and internal control execution
findings.
Group-wide policies, principles and instructions are available to all Outokumpu employees,
to provide guidance on correct ways of operating. Sustainability reporting-related matters
are communicated to the parties involved mainly through regular meetings, Outokumpu’s
intranet, emails as well as digital platforms. The ESG Steering Group convenes regularly to
address sustainability-related topics and to solve issues, including items relevant to
sustainability reporting. (ESRS 2-GOV-5-36-(d))
Outokumpu Annual Report 2024
49
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Reporting to administrative, management and supervisory bodies
The Audit Committee reviewed overview of the sustainability reporting -related risks during
2024. ESG Steering Group will continue to assess sustainability reporting -related risks
minimum once a year. Similarly, internal controls, which mitigate these risks in
sustainability reporting, and the effectiveness of them, are also reported to the ESG
Steering Group for information and for corrective actions, if any are needed.
The organization evaluates and communicates internal control deficiencies promptly to the
parties responsible for taking corrective action, including executive and senior
management, and the Board of Directors, as appropriate. Management both in
Outokumpu’s group companies and in functions, is responsible for the follow-up and
monitoring of internal controls.
The internal audit function monitors that an appropriate control environment exists across
the Group. Risk management, the compliance function, and the sustainability report
assurance provider are also engaged in the review of control activities. The findings of the
assurance procedures, as well as the maturity of the system of internal controls are
reported to the Audit Committee on a regular basis. (ESRS 2-GOV-5-36-(e))
Strategy
Strategy, business model and value chain
Key elements of strategy related to sustainability matters
Outokumpu’s offering consists of low-emission stainless steel. Stainless steel products can
further be divided into classic products that provide the most commonly used stainless
steel products, and the specialty products serving specific stainless steel applications or
demanding end use.
Most of the products are offered to customers as flat products, that is, as hot and cold
rolled coils, strip or sheet, but Outokumpu also offers a variety of options ranging from
heavy plates and hot rolled coil to specialized components and metal powders.
Outokumpu’s commitment to innovation will drive identifying new business opportunities,
investments in technologies, and the invention of new products. (ESRS 2-SBM-1-40-(a)-(i))
Outokumpu’s main markets are Europe (68% of the Group’s sales in 2024) and the
Americas (29%). The main customer segments are distributors (40% of sales), metal
processing and tubes (18%), automotive (15%), heavy industries (8%), and appliances (9%).
(ESRS 2-SBM-1-40-(a)-(ii)) No Outokumpu products are banned in any markets, (ESRS 2-SBM-1-40-
(a)-(iv) and the company does not operate in the fossil fuel sector. (ESRS 2-SBM-1-40-(d)-(i))
Outokumpu’s headcount of 8,736 (number of employees) by geographical area is disclosed
in chapter S1 (S1-6-52). (ESRS 2-SBM-1-40-(a)-(iii))
As ESRS sectors have not been defined or adopted yet, Outokumpu is not reporting
significant or additional ESRS sectors. (ESRS 2-SBM-1-40-(c), ESRS 2-SBM-1-41)
Outokumpu has set its sustainability targets based on material impacts, risks, and
opportunities, considering the magnitude of its entire business, and it does not have
separately defined goals for specific products or customer groups.
The company’s mid-term climate target is to reduce emission intensity by 42% by 2030,
from the 2016 baseline, in line with its science-based climate target. This target applies to
operations of both the company and its supply chain. Outokumpu’s long-term target is to be
carbon neutral by 2050. In line with its purpose, working towards a world that lasts forever,
the company’s ambition is to support its client industries in reducing their emissions in all
client groups in all geographies. One of the key enablers in achieving this is circularity, and
the company has set a target to use over 90% recycled raw materials. (ESRS 2-SBM-1-40-(e))
In line with the vision of being the customer’s first choice in sustainable stainless steel,
Outokumpu produces stainless steel with an up to 75% lower product carbon footprint than
the global industry average*. During 2024, the company supported customer industries in
reducing their carbon footprint by 10 million tonnes, and had a recycled material content of
95%***. To push the industry even further, the company innovated the Outokumpu Circle
Green© product line, with up an to 93% lower product carbon footprint compared to the
global average**. The environmental impact of product categories depends on the raw
materials and production processes used. (ESRS 2-SBM-1-40-(f))
Sustainability is at the core of Outokumpu’s three-phased strategy. In the first phase, the
aim was to de-risk the company by the end of 2022, including strengthening its position as
the sustainability leader. The second phase was started in 2022, targeting productivity
investments, customer-focused steering and additional investments in sustainability, such
as biocoke. The third phase of the strategy will commence in 2026, and it is expected to
require new investments. Outokumpu started preparations for the third phase already in
2023. The company’s focus in the third phase is to strengthen its market position further
and to develop more globally diversified operations including Americas expansion, European
competitiveness, value-chain integration, and sustainability leadership. In the third phase,
the company aims to also create competitive advantage through clean investments to
decarbonization and low-emission solutions. (ESRS 2-SBM-1-40-(g))
* Outokumpu’s average product carbon footprint (2024):1.6 kg CO₂e per kg of stainless steel based on
lifecycle assessment. Global average carbon footprint of stainless steel: (2024):7 kg CO₂e per kg of
stainless steel. (Outokumpu’s calculation based on data provided by CRU, worldstainless and Kobolde &
Partners AB).
** The recycled material content measures the amount of recycled and recovered metals in relation to
crude steel output. It is aligned with ISO 14021, and it excludes recovered metals generated in the same
Outokumpu Annual Report 2024
50
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
steel making process. The method is also aligned with the EU taxonomy criteria for use of recycled steel in
steel manufacturing.
*** Global average carbon footprint of stainless steel: (2024):7 kg CO₂e per kg of stainless steel
(Outokumpu’s calculation based on data provided by CRU, worldstainless and Kobolde & Partners AB).
Outokumpu Circle Green CO₂ emissions: down to 0.5 kilos of CO₂e per kg of stainless steel.
Business model and value chain
Outokumpu’s business model is based on circularity, and the majority of the company’s raw
materials comes from recycled steel. Stainless steel itself is infinitely recyclable.
Outokumpu’s value chain includes research and development, raw material sourcing and
extraction, inbound logistics, production, sales and marketing, outbound logistics,
processing and use, as well as scrapping and recycling back to the value chain. Structurally,
the business is divided into three business areas – Europe, the Americas, and Ferrochrome
– where each has responsibility for sales, supply chain management and operations. They
are also Outokumpu’s operating segments under International Financial Reporting
Standards (IFRS). The Ferrochrome business area operates in the upstream of Outokumpu’s
value chain, producing ferrochrome raw material for the other two business areas, which
focus on stainless steel manufacturing and sales. The business areas are supported by the
Group functions. (ESRS 2-SBM-1-42)
Outokumpu is part of a global supply chain, including raw material, services, and other
material suppliers worldwide. Sustainable sourcing, with the process of selecting and
managing suppliers, is critical across all purchases, especially in raw material sourcing. The
key inputs Outokumpu sources from its partners are scrap metal, metals required for
stainless steel production, such as nickel and molybdenum, and low-emission energy to run
its energy-intensive manufacturing operations. Responsible sourcing is a pivotal part of
Outokumpu’s sustainability roadmap, and the company is actively partnering with
companies in its upstream to secure access to low-emission raw materials. Examples of
this are the recent partnerships with CRONIMET to retain supply of high-quality scrap metal
and with a Canadian company, FPX Nickel, to secure long-term supply of low-emission
nickel metal. In addition to sourcing, Outokumpu has secured its access to low-emission
ferrochrome through its own mine in Kemi. Outokumpu’s Kemi mine is targeting to become
carbon neutral by 2025. (ESRS 2-SBM-1-42-(a))
Outokumpu's main outputs are stainless steel products that have an up to 75% lower
carbon footprint compared to the industry average. In 2024, Outokumpu delivered roughly
1.8 million tonnes of stainless steel, which supported their customers in reducing their
supply chain emissions by 10 million tonnes*. The annual production of ferrochrome, the
second key product of Outokumpu, is roughly 398,000 tonnes. For customers,
Outokumpu's products provide a solution to reduce their Scope 3 emissions. For investors,
Outokumpu aims to distribute a stable and growing dividend. In addition, interests and
financing expenses were EUR 59 million and employee benefits EUR 714 million to
employees in 2024. Outokumpu Group is contributing to society with operational taxes,
value-added taxes, employment taxes etc., while the corporate tax in 2024 was a refund of
EUR 2 million. Outokumpu contributes to the United Nations' Sustainable Development
Goals through both the way it operates and its products. (ESRS 2-SBM-1-42-(b))
Outokumpu’s role and presence varies between each part of its value chain. Outokumpu’s
core activities range from research and development to outbound logistics, while further
processing, use and recycling are not part of Outokumpu’s core activities. Research and
development focuses on the innovation of products and materials, including, high alloy
steels, other steels and side-stream products. In raw material sourcing and extraction
Outokumpu plays a double role: Outokumpu has its own mining operations in Kemi, Finland,
for the extraction of chromite ore, the required primary raw material for stainless steel, but
is also active in raw material sourcing, focusing on securing low-emission scrap, nickel and
other relevant raw materials from external sources. The production step covers refining,
smelting, and production of stainless steel, including casting, shaping, heat treatment, and
finishing. The sales and marketing step includes sales, customer relationships
management, and distribution and channels. In inbound and outbound logistics,
Outokumpu manages inventories of both raw materials and finished products, and utilizes
partners for the transportation of both. (ESRS 2-SBM-1-42-(c))
* Outokumpu’s average product carbon footprint (2024): 1.6 kg CO₂e per kg of stainless steel based on
lifecycle assessment. Global average carbon footprint of stainless steel: (2024): 7 kg CO₂e per kg of
stainless steel. Outokumpu’s calculation based on data provided by CRU, worldstainless and Kobolde &
Partners AB. The calculations are based on the following four studies (2024): 304 Stainless Steel Carbon
Footprint Comparison EU, Indonesia and China (2022), CRU Nickel Market Outlook Data (2022), “The
Global Life Cycle of Stainless Steels” (2019), and ISSF Stainless Steel and CO2 (2022).
Interests and views of stakeholders
Stakeholder engagement
With several manufacturing facilities, Outokumpu engages with a variety of stakeholders
around the world. Investors, customers, the company’s own workforce, value chain workers,
and the affected communities the company operates in are among the key stakeholder
groups for Outokumpu. (ESRS2-SBM-2-45-(a)-(i))
Engagement with stakeholders takes place both locally in the operations and centrally at
the group level. Currently, Outokumpu has certain structured frameworks in use locally to
engage with stakeholders, for example at Kemi mine, Finland, through the Towards
Sustainable Mining Finland standard. For European operations, the company is developing
a systematic engagement approach based on the ResponsibleSteel certification. The views,
interests and rights of its own workforce inform Outokumpu’s strategy and business model
via regular and structured forms of interaction, for example in the Outokumpu Personnel
Forum and its Group Working Committee. More information on how this interaction takes
place can be found in the Own workforce (S1) chapter, in the Processes section,
“Processes for engaging with own workforce and workers’ representatives about impacts”.
Similarly the views, interests and rights of value chain workers and affected communities
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are taken into account at the group level and locally at operations through various
practices. (ESRS 2-SBM-2-45-(a)-ii))
However, Outokumpu is developing further its stakeholder engagement globally on a Group-
level, to coordinate and understand the various stakeholder interests and views and how
they inform the company’s strategy and business model. During the development project
the purpose of stakeholder engagement, as well as its outcomes, implementing
amendments and monitoring-related progress, will be further defined. (ESRS 2-SBM-2-45-(iii),
(iv), (v), (b), (c), (c)-(i)
The project started in 2024 and will be completed during 2025 with defined further
actions. The project findings will also be linked to Outokumpu’s sustainability due diligence
process development regarding its own workforce, value chain workers, and the affected
communities. (ESRS 2-SBM-2-45-(c-ii)) The project findings are expected to lead to identifying
further actions to develop stakeholder engagement at Outokumpu. (ESRS 2-SBM-2-45-(c-iii))
Another objective is to develop a procedure for informing the company’s administrative,
management, and supervisory bodies about these views and interests. The reporting
requirements on stakeholder engagement will be considered in close connection with the
further development of Outokumpu’s sustainability due diligence process. (ESRS 2-SBM-2-45-
(d))
The table below includes a summary of Outokumpu’s key stakeholders, as well as the
topics and forms of the engagement. The impact of engaging with key stakeholders, such
as the company’s own workforce, value chain workers and affected communities, on
Outokumpu’s strategy and business model will be disclosed in 2025 Sustainability
statement based on the development actions described above. (ESRS 2-SBM-2-43)
Interests and views of various stakeholders
Stakeholder type
Examples of engagement topics
Examples of engagement forms
Shareholders,
investors and
other capital
market
stakeholders
•
Profitability and profit sharing
•
Long-term value creation
•
Societal value creation
•
Corporate governance
•
Environmental and social impact
in own operations and value chain
•
Constant dialogue and annual general
meeting
•
Quarterly and annual publications
•
Events and site visits
•
Double-materiality assessment
Own workforce
•
Strategy and organization
•
Well-being, health and safety
•
Learning and development
•
New initiatives and projects
•
Employment and labour rights
•
Employee representative cooperation
•
Constant dialogue
•
Personnel surveys and trainings
•
Townhalls and other meetings
•
SpeakUp and other reporting channels
Customers and
end-users
•
Quality and service
•
Product information and safety
•
Environmental and social impact
in own operations and value chain
•
Customer surveys and audits
•
Sustainability due diligence
•
Double-materiality assessment
Suppliers,
partners and
workers in the
value chain
•
Production input quality and
availability
•
Environmental and social impact
in own operations and value chain
•
Constant dialogue
•
Seminars, joint projects and trainings
•
Site visits
•
Sustainability due diligence
•
Double-materiality assessment
Affected
communities
related to own
operations and
value chain
•
Well-being and health & safety
•
Environmental and social impact
in own operations and value chain
•
Community impact
•
Rights of indigenous peoples
•
Constant dialogue
•
Site visits
•
Financial support to local projects
•
Sustainability due diligence
Policymakers
•
Political and regulatory landscape
•
Constant dialogue
•
Hearings and other consultation
processes
•
Events and visits to manufacturing sites
Authorities
•
Legal compliance
•
Environmental and social impact
in own operations and value chain
•
Constant dialogue
•
Inspections and other site visits
Business
organizations
•
Corporate approach on political
and regulatory developments
•
Constant dialogue
•
Representation and events
Civil society
representatives
•
Environmental and social impact
in own operations and value chain
•
Constant dialogue
Research and
educational
institutions
•
Product and process development
•
Future employment needs
•
Environmental and social impact
in own operations and value chain
•
Joint research and other cooperation
projects
•
Recruitment events and student fairs
•
Lectures, study visits, thesis
assignments and traineeships
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Governance and remuneration
Material impacts, risks and opportunities
and their interaction with the strategy and
business model
Material impacts, risks and opportunities resulting from
the materiality assessment
Outokumpu identified 15 topics material for the company in its double materiality
assessment. Stainless steel production and its supply chain require significant amounts of
energy and raw materials, contributing to greenhouse gas emissions and impacting
negatively on climate change. Energy and raw material price volatility and high renewable
fuel costs pose financial risks for the company’s operations. However, additional energy
efficiency initiatives create opportunities for reducing energy consumption and costs.
Outokumpu has mitigated its impacts by using recycled raw materials, low-emission energy,
and improving energy efficiency.
Producing stainless steel with over 90% recycled raw materials has a positive impact by
reducing reliance on primary raw materials, reducing carbon emissions and mitigating
biodiversity loss caused by mining. Rising carbon prices, availability of low-emission raw
materials and uncertain decarbonization technologies are seen as a financial risk. On the
other hand, the significantly lower carbon footprint of Outokumpu’s stainless steel
compared to the industry in general and vertically integrated ferrochrome production can
create competitive advantage and financial opportunities for the company, especially
considering EU’s Carbon Border Adjustment Mechanism.
Stainless steel production processes and mining operations in Outokumpu’s supply chain
can have a negative impact on the environment. These potential impacts are caused by
water usage, release of emissions to air and water and generation of waste and hazardous
substances, if not mitigated appropriately. Tighter regulation and rising cost of landfill
waste can potentially increase costs and compliance risks for the company. However, the
life cycle benefits of long-lasting stainless steel can have a positive impact by supporting
sustainability, safety and hygiene in applications within the downstream. Additional
financial opportunities exist in recycling raw materials and developing by-products from the
company’s waste streams.
Due to the nature of steel production processes, employees can face hazardous working
conditions. Outokumpu has invested in high safety standards and employee well-being
which represent financial opportunities in enhanced performance and talent attraction. By
promoting diversity, equity and inclusion, the company fosters innovation and attracts
talent. To prevent incidents of harassment, discrimination and unconscious biases that can
lead to financial risks, the company puts significant efforts in educating its employees on
appropriate work behavior.
All the material topics are presented in the matrix, according to the impact materiality and financial
materiality. The highest number given in the scoring defines the position of the sustainability topic in the
matrix, meaning that, between positive and negative impacts, the higher score was chosen for the matrix.
Similarly for the financial materiality, between scores given to risks and opportunities, the higher score is
chosen for the matrix.
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Stainless steel has a complex global value chain with suppliers in high-risk countries. Poor
working and living conditions in Outokumpu’s supply chain can lead to negative impacts
which pose a financial risk. Through risk-based assessment and strengthening human
rights, Outokumpu has a positive impact in its supply chain and creates financial
opportunities through increased transparency towards its stakeholders and better business
resilience. Communities in the value chain can also be affected by the production of
stainless steel. Impacts can be positive through supporting local communities,
collaborating with local authorities and by promoting human rights in the supply chain.
Establishing a robust human rights due diligence process has strengthened Outokumpu’s
supply chain resilience as well as enhanced sustainability leadership.
Non-compliance with laws and policies, or unethical behavior would result in legal, financial,
and reputational consequences for Outokumpu and its partners. Outokumpu fosters a
transparent and ethical culture and expects business partners to uphold similar standards
across the value chain.
More information on material impacts, risks and opportunities resulting from materiality
assessment (ESRS 2-SMB 3-48-(a)) are disclosed under every material topic, at the
beginning of each material topics’ chapters, for E1-E5, S1-S3 and G1-1.
(ESRS 2-SMB 3-48-(a))
Additional information: disclosures’ locations in the report related to
material impacts, risks and opportunities
Processes to identify and assess material impacts, risks and opportunities (IRO-1) are
disclosed in General disclosure (ESRS2), under Impact, risk and opportunity management
section, for environmental topics, E1- E5. Disclosure requirements in ESRS covered by the
undertaking’s sustainability statement (IRO-2) are presented after IRO-1.
Material impacts, risks and opportunities and their interaction with the strategy and
business model (ESRS2 SBM-3) are presented in each topic’s Strategy section in terms of
climate change (E1), biodiversity and ecosystems (E4), own workforce (S1), workers in the
value chain (S2), and affected communities (S3).
Effects of material impacts, risks and opportunities on the business
model, value chain, strategy and decision-making
Outokumpu has integrated sustainability into its strategy, vision and purpose. The
company's vision is to be the customer’s first choice in sustainable stainless steel.
Outokumpu’s vision directly aligns with its strategy to mitigate climate-related risks and
capture opportunities associated with the transition to a low-carbon economy.
The identified impacts, risks and opportunities, particularly those linked to climate change,
the circular economy, and biodiversity, influence Outokumpu’s business model by shaping
product innovation, operational processes, and the adoption of low-emission technologies.
For instance, commitments to reducing greenhouse gas emissions and improving energy
efficiency drive investments in low-emission production methods and renewable energy,
ensuring alignment with global warming targets below 1.5ºC.
In the value chain, sustainability considerations are central to fostering resilience and
enhancing supply chain practices. Efforts to promote circular economy principles, such as
increasing recycled content in stainless steel production, mitigate risks of resource scarcity
and strengthen relationships with environmentally conscious suppliers. Biodiversity
preservation further supports long-term operational continuity and resource security.
The company's targets also guide Outokumpu’s efforts to achieve zero safety incidents,
enhancing diversity, equity and inclusion, and fostering its supply chain sustainability.
Decision-making processes integrate IROs to maintain compliance with laws and
regulations. Pollution prevention and waste reduction efforts not only meet regulatory
standards but also reduce operational costs and enhance Outokumpu’s competitive
advantage. Similarly, fostering supply chain sustainability reduces risks associated with
unethical practices or non-compliance among suppliers.
Outokumpu is strongly committed to the highest ethical standards and complies with the
applicable laws and regulations of the countries in which it operates as well as with the
agreements and commitments it has made. (ESRS 2-SMB 3-48-(b)
Material impacts
On people and the environment
Stainless steel manufacturing is energy and resource intensive, which contributes to
greenhouse gas emissions, making climate change mitigation the most material topic for
Outokumpu. Waste management, including hazardous substances, has the potential to
cause environmental and health issues unless properly managed. Outokumpu has identified
people in the supply chain, especially in alloy production, at risk to be negatively affected
through working conditions or through affected communities. (ESRS 2-SBM-3-48-(c)-(i))
On the business model
The main impacts originate from Outokumpu’s business model, as manufacturing stainless
steel is energy-intensive and requires vast resources in the form of metal alloys. This
creates large amounts of greenhouse gases, which are released into the atmosphere. The
mining of primary metals for alloys is also energy intensive and contributes to resource
depletion. Outokumpu includes mitigating actions in its strategy and way of working. The
company has also established a transition plan which is integrated into the strategy. In
addition, Outokumpu is using a high amount of recycled metals in its production, in 2024
95.3%. (ESRS 2-SBM-3-48-(c)-(ii))
Time horizons of the impacts
The expected time horizon is short-term when considering the company’s own workforce
and value-chain workers, short-to mid term when considering pollution, water, the circular
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economy, and affected communities, and long-term for climate change and biodiversity.
(ESRS 2-SBM-3-48-(c)-(iii))
With business relationships
Material impacts mainly show in Outokumpu’s own business activities, as described above.
Business relationships extend them to value chain workers, in particular Outokumpu’s raw
material suppliers, since the mining of metals for alloying elements has the potential to
negatively affect local environment and communities where it is mined.
(ESRS 2-SBM-3-48-(c)-(iv))
Current and anticipated financial effects
Based on the double materiality assessment on risks and opportunities, Outokumpu has
not identified any current financial effects on its financial position, financial performance or
cash flow or any significant risk for a material adjustment of its carrying amounts of assets
and liabilities within the next annual reporting period. (ESRS 2-SBM-3-48-(d))
Outokumpu chooses to omit the information required by ESRS 2-SBM-3-48-(e), anticipated
financial effects according to ESRS1 Phased-in Disclosure Requirements (Appendix C).
(ESRS 2-SBM-3-48-(e))
Resilience
The company has evaluated initially the resilience of its business and strategy as part of
the double materiality assessment conducted in 2023, and it continues to develop the
resilience analysis, including quantitative assessment, in the following reporting years.
Based on the earlier assessment, due to its low-carbon footprint and high use of recycled
raw materials, the company has built resilience against climate-related transition risks.
Outokumpu is further committed to the science-based target of keeping global warming
below 1.5°C and reduce its transition risk by implementing low-carbon technologies, and
increasing the use of clean energy in its product portfolio. More information can be found
under Climate Change chapter (E1), in the section Resilience of strategy and business
model -section. (ESRS 2-SBM-3-48-(f)
Changes compared to the previous reporting period
Outokumpu conducted double materiality assessment for the first time during 2023. The
scope differs slightly from previous materiality assessment, resulting in a wider number of
material topics when considering the value chain impact. However, most relevant topics,
such as climate change, energy and waste, have been identified as such in previous
assessments. (ESRS 2-SBM-3-48-(g))
Additional disclosures
Outokumpu does not report entity-specific disclosure requirements that are not covered by
ESRS. (ESRS 2-SBM-3-48-(h))
Impact, risk and opportunity
management
Processes to identify and assess material impacts,
risks and opportunities
Methodologies and assumptions
Methodologies applied in the process included a desktop analysis using public reporting,
industry-specific publications, value chain mapping, Outokumpu’s existing studies, and
stakeholder and expert interviews in order to understand the context and scope of the
double materiality assessment, as well as quantitative and qualitative impact and risk
assessment.
The identification of impacts, risks and opportunities was guided by two key questions:
•
What impacts related to the ESG topic does the company have on people and the
environment along its entire value chain?
•
What financial risks and opportunities can arise for the company in relation to the ESG
topic? (ESRS 2-IRO-1-53-(a))
Process in identifying, assessing and monitoring impacts on
people and the environment
The double materiality assessment adhered to the general principles (ESRS 1, chapter 3)
and took existing practices, such as Outokumpu’s previous double materiality assessment
from 2021, and existing risk management practices into consideration. (ESRS 2-IRO-1-53-(b))
The analysis started with mapping out the main features of Outokumpu’s activities (it
included all current Outokumpu sites and locations, taking into consideration the activities
from local and group-level perspectives), business relationships and geographies, to map
where sustainability impacts are or would most likely occur. This mapping of impacts for
each ESG topic was conducted as a desktop analysis using existing internal and public
materials. As the assessment was done on a sub-topic level, a cross-check was carried out
to ensure that all sub-subtopics were considered. The remaining sub-subtopics were
discussed with Outokumpu experts to determine relevance and materiality for the
assessment. (ESRS 2-IRO-1-53-(b)-(i), (G1-ESRS 2-IRO-1-6)
Impacts were considered within the Outokumpu value chain. The value chain is defined as
the full range of activities, resources and relationships Outokumpu uses or relies on to
create its products from conception to end-of-life. Regarding affected communities the
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information was gathered from earlier discussions held focusing on the upstream in the
value chain. (ESRS 2-IRO-1-53-(b)-ii))
The listed impacts were refined and expanded based on internal and external expert
interviews. The relevant stakeholders were identified to represent different parts of the
value chain: NGOs, suppliers, customers, investors, and external industry specialists.
Internal stakeholder interviews were held to gain understanding of the impacts connected
to specific sustainability themes. Internal experts were interviewed to validate and
complement the impacts. (ESRS 2-IRO-1-53-(b-iii)
Once the impacts were identified, the next step was to assess them using a set of
predetermined evaluation criteria. The scales and methodology were determined based on
ESRS1. The severity of an impact has been evaluated as the sum of scale, scope and, in
the case of a negative impact, remediability. To ensure the comparability of positive and
negative impacts on a similar scale, the severity of positive impacts were multiplied by a
factor of 1.5. The likelihood of potential impacts has been rated using a 1 to 4 scale
representing probabilities of occurrence of <25%, >25%, >50% and >75% within 10 years
and each assigned a likelihood factor for calculation. Multiplying the severity and likelihood
factor of an impact results in the materiality level of the impact. Impacts above the
threshold of 50% of the maximum value are subject to disclosure, and the associated ESG
topic is material for reporting purposes. The threshold mirrors EFRAG’s Guidance and is
defined to fit the purpose of the assessment. (ESRS 2-IRO-1-53-(b)-iv))
Overview of process for identifying, assessing and
monitoring risks and opportunities related to financial effects
The process of identifying and evaluating sustainability-related risks and opportunities
utilized the same methodologies, assumptions, and input parameters as those used for the
identification and evaluation of related impacts. As the process was run by subtopic, the
identification of impacts included the identification of risks and opportunities caused by
each impact. (ESRS 2-IRO-1-53-(c), G1-ESRS 2-IRO-1-6)
Most risks and opportunities were evaluated as arising from various resource
dependencies, which have the potential to cause future financial impacts. The evaluation of
the financial impact explicitly takes into account the cost of preservation and remaining
useful life. (ESRS 2-IRO-1-53-(c)-(i))
The financial effects of risks and opportunities were assessed using a set of predefined
criteria for magnitude and the same likelihood rating as for impacts. The scales were
determined in alignment with Outokumpu’s risk management and based on ESRS1
requirements. The magnitude has been rated on a scale of 0–5, each implying a range of
financial effect, both positive and negative. The likelihood has been rated considering a 10-
year horizon and taking into account potential countermeasures. Multiplying the magnitude
and likelihood factor results in the materiality level of the financial impact from 0-5.
Impacts above the threshold of 3 are subject to disclosure and the associated ESG topic is
material for reporting purposes. The thresholds mirror EFRAG’s guidance and were defined
to fit the purpose of the assessment. (ESRS 2-IRO-1-53-(c)-(ii))
The enterprise risk management process evaluates sustainability-related risks in the same
way as other types of risks, using magnitude and likelihood. The methodology of the double
materiality assessment was aligned with the digital risk management process, and
Outokumpu further continues to integrate the identified risks, impact and opportunities in
its risk management process during the next reporting year. (ESRS 2-IRO-1-53-(c)-(iii))
Decision-making process and related internal controls
Validation workshops were held to evaluate the overall assessment between the topics and
within the same topic in Outokumpu’s enterprise risk management process. Topics near the
threshold of materiality were separately discussed during a workshop to re-evaluate the
scoring, and expert judgement was used to determine final materiality, according to the
EFRAG guidelines. As a control measure, management validation was done for the
assessment of impacts, risks and opportunities and the materiality matrix. (ESRS 2-IRO-1-53-
(d))
Integration into overall risk management and management processes
The initial identification and assessment of impact, risks, and opportunities was run in
alignment with Outokumpu’s risk management process using a simplified approach for the
evaluation by combining financial and non-financial impacts into one rating. Outokumpu
has already initiated the integration with its risk management process. (ESRS 2-IRO-1-53-(e))
The double materiality assessment process feeds into the existing risk management
process and takes into account the expert knowledge of previous assessments regarding
opportunities. Outokumpu also considers opportunity management in the integration into
its enterprise risk management process. (ESRS 2-IRO-1-53-(f))
Input parameters and changes in them
The main input parameters for Outokumpu’s double materiality assessment included
desktop analysis using Outokumpu’s existing materials, public reporting, industry-specific
publications, and perspectives and expertise of both internal and external stakeholders.
The process covered, on a general level, Outokumpu’s own activities, and the geographical
areas of its operations, as well as upstream and downstream value chain activities. (ESRS 2-
IRO-1-53-(g))
As it is the first time Outokumpu conducted a double materiality assessment based on the
ESRS, Outokumpu does not report any changes to prior reporting periods. The review of the
double materiality assessment is planned for 2025. (ESRS 2-IRO-1-53-(h))
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Processes to identify and assess material climate-related impacts,
risks and opportunities
Impacts on climate change
Outokumpu's operations impact climate change through greenhouse gas emissions. By
incorporating inputs such as evaluations of different mitigation techniques and calculated
transition scenarios that project future emissions, as well as value chain emissions
identified and assessed based on life-cycle studies and expert judgement, different
greenhouse gas emission sources were identified. The majority come from indirect
emissions connected to the sourcing of raw materials such as nickel, as well as energy
consumption. The actual and potential impacts of climate change were evaluated using the
same methodology and available data as for other identified impacts.
(E1-ESRS 2 IRO-1-20-(a)), AR-9)
Physical risks in own operations and the value chain
Outokumpu has identified climate-related hazards as part of physical climate risk analysis
for production sites, as required by the EU taxonomy’s do-no-significant-harm criteria for
climate change adaptation. The assessments have been based on the methodology
presented in Appendix A in Annex I of the Climate Delegated Act, focusing on short-, to
long-term effects by considering climate projections up to at least 10-30 years in the
future. The assessments have focused only on Outokumpu’s own operations and the
physical risks they face. (E1-ESRS 2 IRO-1-20-(b))
Transition risks and opportunities in own operations and the value chain
Outokumpu has identified climate-related hazards as part of its transition plan. In
Outokumpu’s scenarios, the company has taken into account hazards that have been
identified in its risk management: the stainless steel industry is energy-intensive, and
production processes have high greenhouse gas emissions. Raw materials and transport
also contribute to these emissions. The main risk is that decarbonization technologies and
investments would not be viable and effective enough to meet transition requirements. New
regulations and new technologies needed for transition could increase production costs.
Availability of low-emission raw materials, like steel scrap or alloys with reduced climate
impact, is also a risk. (E1-ESRS 2 IRO 1-20-(c))
Scenario analysis regarding physical and transition risks and opportunities
To identify and assess the physical and transition risks and opportunities, Outokumpu has
performed a variety of analyses. Regarding physical risks, Outokumpu has performed a risk
analysis for its own operations, according to the EU taxonomy’s do-no-significant-harm
criteria and evaluated the financial risks by site. The supply chain was evaluated in terms
of the risk of interruption in supply to its operations. According to the analysis, physical
climate risks do not pose a material financial risk for Outokumpu. (E1-ESRS 2 IRO-1-21)
Regarding transition risks and opportunities, Outokumpu has performed a stated policy
scenario and sustainable development scenario analysis in line with the International
Energy Agency Iron and Steel Technology Roadmap (2020). (E1-ESRS 2 IRO-1-21)
Identified climate-related hazards
Outokumpu has identified transition-related climate change risks based on its double
materiality assessment. In addition, climate-related hazards have been identified as part of
a physical climate risk analysis for production sites, according to the EU taxonomy’s do-no-
significant-harm criteria for climate change adaptation. These assessments follow the
methodology of Appendix A, Annex I of the Climate Delegated Act, focusing on short to long-
term effects, considering climate projections up to at least 10–30 years in the future.
These assessments focus only on Outokumpu’s own operations and the physical risks they
face. (E1-ESRS 2 IRO-1, AR 11-(a))
In these assessments, Outokumpu identified climate-related risks from short- to long-term
time horizons. However, the hazards were not linked to the expected lifetime of the assets,
strategic planning horizons or capital allocation plans. (E1-ESRS 2 IRO-1, AR 11-(b))
The site-specific assessment took into consideration the likelihood, magnitude, and
duration of the hazards at each location, whenever deemed necessary or plausible. Each
factor was assessed based on scientific research of potential changes under different
scenarios. The assessments took into consideration the different likelihood of extreme
weather conditions, such as cyclones, floods, and so on, in different geographical locations.
Duration was a key factor when looking at the effects of heat stress in Alabama, where the
number of hot-temperature days is expected to increase from 7 in 2022 to 47 in 2050,
under a high-temperature scenario. The magnitude of the hazards at Group level were
assessed as part of the double materiality assessment and overall business risk processes,
which determined the physical risks to be non-material. (E1-ESRS 2 IRO-1, AR-11-(c))
The assessments were largely based on shared socioeconomic pathways (SSPs) and
climate change scenarios by the UN’s Intergovernmental Panel on Climate Change (IPCC),
including SSP5 – 8.5, where physical risks are most prevalent. The scenarios were
considered through local or regional projections of climate-related hazards under the IPCC’s
climate change scenarios, such as those made by the Swedish Meteorological and
Hydrological Institute. These projections provided insights into local risks at each site in
different scenarios. Due to the limited data on scenarios from different local or regional
providers, the level of detail varied across the assessments. Some assessments were able
to identify risks based on geospatial coordinates, whereas others looked at changes on a
national level. Additionally, some projections relied on the IPCC’s Sixth Assessment Report
data, while others relied on the older Fifth Assessment Report data. (E1-ESRS 2 IRO-1,
AR 11-(d))
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
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Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Identified transition events
Outokumpu has identified transition events that may cause transition risks to Outokumpu
and have an adverse impact on Outokumpu’s operating environment and financial position
in the long, medium, and short term. (E1-ESRS 2 IRO-1, AR 12-(a))
Assessing the extent to which assets and business activities may be exposed to identified
transition events, Outokumpu has identified physical climate risks and mitigation measures
for all sites and included these in the general risk assessment system. The evaluation
shows that the physical risk does not materially impact the Group’s capital expenditure or
operative expenses. However, the financial impact of the climate transition risk is
significant and has been estimated for the target period until 2030. To be able to attain
the 1.5°C climate target, the company has created and committed to a transition plan, in
which many greenhouse gas emission reduction projects have been initiated already.
(E1-ESRS 2 IRO-1, AR 12-(a-b))
Identified transition events in Outokumpu’s climate-related scenarios include:
•
evolving climate change policies, increasing regulation and reporting requirements;
•
increased price of CO2 emissions and the related rising electricity price;
•
increased cost of raw materials and uncertainty about availability of energy and low-
emission raw materials at affordable prices;
•
viability and effectiveness of decarbonization technologies in the coming years;
•
risk of losing customers and market share; on the other hand, customers switching to
low-emission steel could have a positive impact. (E1-ESRS 2 IRO-1, AR-12-(c))
Outokumpu has also assessed assets and business activities that are incompatible with or
that need significant efforts to be compatible with the transition to a climate-neutral
economy. The production of ferrochrome requires coke as a reductant in the process, and
while coke is used in the ferrochrome production process, emissions could be seen as
partly locked in. Ferrochrome production is not included as eligible under the EU taxonomy.
In stainless steel production, the use of electrodes is considered locked-in emissions, but
does not pose a material risk to the greenhouse gas emission reduction targets.
Outokumpu has also assessed locked-in emissions from the upstream value chain with
lime-related emissions being the main source. However, the company has identified ways to
reduce greenhouse gas emissions from locked-in emissions, as well. (E1-ESRS 2 IRO-1,
AR 12-(d))
Compatibility of climate scenarios with financial assumptions
Outokumpu’s climate scenarios are aligned with the 1.5°C target of the Science Based
Targets initiative. (E1-ESRS 2 IRO-1, AR-15)
Processes to identify and assess material pollution-related impacts,
risks and opportunities
All Outokumpu production sites have valid environmental permits, and production-related
emissions from the company’s own operations have been assessed either in environmental
impact assessments or in discussion with local authorities to identify impacts and risks.
This is an ongoing process since the sites are in constant dialogue with local authorities
due to new investigations or renewal of permits. Value chain emissions have been screened
mainly by means of life cycle assessments, according to ISO 14040 methodology indicating
where in the value chain the highest risks are. (E2-ESRS 2 IRO-1-11(a)
Conducting of consultations
Local communities have the possibility to raise topics either in the permit processes or in
regular meetings where the sites explain their activities to local residents. This is part of
normal business and no additional measures were introduced in the context of the double
materiality assessment process. (E2-ESRS 2 IRO-1-11(b))
The outcome of the materiality assessment
Stainless steel and ferrochrome manufacturing have a negative impact on the environment
in the form of air and water emissions. The production processes generate pollutants such
as metals and nitrates that may enter water bodies and have negative impacts on water
quality and aquatic ecosystems if not properly managed. Thus, all operating sites are
subject to environmental permits and have pollution abatement techniques such as
wastewater treatment plants installed at sites. This applies to the company’s operations in
Kemi and Tornio in Finland; Avesta, Nyby and Degerfors in Sweden; Krefeld and Dillenburg
in Germany; Calvert, Alabama in the US; and San Luis Potosí in Mexico. (E2-ESRS 2 IRO-1-AR-9)
Processes to identify and assess material water-related impacts,
risks and opportunities
Actual and potential impacts, risks, and opportunities on water resources at own production
sites and in the value chain have been assessed in the double materiality assessment
process. More regarding the process can be found in the section ”Processes to identify and
assess material impacts, risks and opportunities”. Marine resources were analyzed as part of
the process; however, the results indicated that they are immaterial in terms of impacts, risks,
and opportunities for Outokumpu. A water risk mapping tool (Aqueduct WRI) was utilized to
assess water-related risks. (E3-ESRS 2 IRO-1-8-(a))
Conducting of consultations
Water-related topics were part of human rights impact assessments Outokumpu has
conducted in the upstream value chain. Assessments include gathering input from affected
communities. This information has been utilized as background information in the double
materiality assessment. Direct suppliers were consulted for the double materiality assessment,
as well as customers, representing the downstream value chain. (E3-ESRS 2 IRO-1-8-(b))
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Processes to identify and assess material biodiversity and
ecosystem-related impacts, risks and opportunities
Actual and potential impacts on biodiversity and ecosystems at our own site locations and
in the value chain have been assessed in the double materiality assessment process.
Outokumpu has also conducted a biodiversity screening focusing mainly on its own
operations. Outokumpu’s own operations were categorized according to the global industry
classification standard, and the risk profile was assessed using ENCORE and IBAT data.
After reassessment, based on the location-specific environmental factors, the final risk
level was determined. Biodiversity impacts are also covered in the supplier assessment
done using the EcoVadis tool based on industry risk. The negative impacts on biodiversity
are particularly caused by mining activities, which are only a small part of Outokumpu’s
operations in Finland. However, considering the supply chain, the scale is high. (ESRS E4-
ESRS 2 IRO-1-17-(a))
Dependencies on biodiversity and ecosystems and their services have been assessed in the
double materiality assessment. Outokumpu has also conducted a biodiversity screening
focusing on its own operations. The screening also identified several dependencies on
biodiversity and ecosystems.
Outokumpu is currently working to expand and deepen the biodiversity assessment, and to
widen the scope to cover the value chain. The company is also looking at the sector
variations, sector guidance and expanding the use of tools in the assessment. The process
will be documented 2025. This will also cover dependencies. (ESRS E4-ESRS 2 IRO-1-17-(b))
Transition and physical risks and opportunities related to biodiversity and ecosystems have
been assessed in the double materiality assessment. Outokumpu has also conducted a
biodiversity screening focusing on its own operations. The screening also identified several
transition and physical risks. Outokumpu is currently working to expand and deepen the
biodiversity assessment, and to widen the scope to cover the value chain. The company is
also looking at the sector variations, and sector guidances, and expanding the use of tools
in the assessment. The process will be documented in 2025. This will also cover transition
and physical risks. (E4-ESRS 2 IRO-1-17-(c))
Conducting of consultations
Outokumpu has consulted local communities as part of the environmental permit process.
Regarding suppliers, affected communities have been consulted as part of the human
rights impact assessment. Consultations have focused on water. A holistic approach to
consulting affected communities will be developed moving forward, and more information
about this is in the S3 chapter. (E4-ESRS 2 IRO-1-17-(e)) Currently, Outokumpu does not have a
corporate-wide approach or a documented process on how to engage affected communities
directly in setting targets to manage material negative impacts, advance positive impacts,
and manage material risks and opportunities. Hence, direct interaction with them on
setting targets during the double materiality assessment process did not take place.
However, Outokumpu is currently developing its sustainability due diligence process to
cover its own operations and value chain. Gap analysis and a related action plan to develop
further the due diligence process were defined in 2024. Actions to engage affected
communities directly in setting targets will be part of this action plan for 2025 and
onwards. (E4-ESRS 2 IRO-1-17-(e)-(i),-(ii), (iii))
Biodiversity-sensitive areas
While Outokumpu's sites are not located in sensitive areas, Outokumpu has identified
areas of high biodiversity value that are owned by the company or located near its sites.
Activities at these sites include stainless steel manufacturing and chrome mining. No direct
negative effects leading to deterioration or disturbance of species have been identified. All
operational sites are located within 10 kilometers of at least one protected area. (E4-ESRS 2
IRO-1-19-(a))
Implementation of biodiversity mitigation measures
Due to identified impacts on the nature in the value chain and own operations, Outokumpu
plans to implement biodiversity mitigation measures. Biodiversity management
requirements are also determined by the ResponsibleSteel standard, and the Towards
Sustainable Mining standards. In addition, Outokumpu has defined biodiversity
management plans for Stainless Europe and Advanced Materials.(E4-ESRS 2 IRO-1-19-(b))
Processes to identify and assess material resource use and circular
economy-related impacts, risks and opportunities
Actual and potential impacts, risks, and opportunities related to resource use and the
circular economy, particularly concerning resource inflows, resource outflows, and waste, at
own site locations and in the value chain, have been assessed in the double materiality
assessment process. More regarding the process can be found above in the section
”Processes to identify and assess material impacts, risks and opportunities”. (E5-ESRS 2
IRO-1-11-(a))
Conducting of consultations
Outokumpu’s human rights impact assessment gathers input from local communities in the
upstream value chain. This information feeds into the double materiality assessment.
Direct suppliers were consulted for the double materiality assessment, as well as
customers, representing the downstream value chain. (E5-ESRS 2 IRO-1-11-(b))
Outokumpu Annual Report 2024
59
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Disclosure requirements in ESRS covered by the undertaking’s sustainability statement
List of ESRS disclosure requirements
General information
BP-1
General basis for preparation of the sustainability statements
43
General information
BP-2
Disclosures in relation to specific circumstances
43
General information
GOV-1
The role of the administrative, management and supervisory bodies
44
General information
GOV-2
Information provided to and sustainability matters addressed by the undertaking’s administrative, management and
supervisory bodies
47
General information
GOV-3
Integration of sustainability-related performance in incentive schemes
48
General information
GOV-4
Statement on due diligence
48
General information
GOV-5
Risk management and internal controls over sustainability reporting
49
General information
SBM-1
Strategy, business model and value chain
50
General information
SBM-2
Interests and views of stakeholders
51
General information
SBM-3
Material impacts, risks and opportunities and their interaction with strategy and business model
53
General information
IRO-1
Description of the processes to identify and assess material impacts, risks and opportunities
55
General information
IRO-2
Disclosure requirements in ESRS covered by the undertaking’s sustainability statements
60
Environmental
Not Applicable
Disclosures pursuant to Article 8 of Regulation (EU) 2020/852 (Taxonomy Regulation)
68
Environmental
E1-1
Transition plan for climate change mitigation
75
Environmental
E1-2
Policies related to climate change mitigation and adaptation
77
Environmental
E1-3
Actions and resources in relation to climate change policies
78
Environmental
E1-4
Targets related to climate change mitigation and adaptation
79
Environmental
E1-5
Energy consumption and mix
82
Environmental
E1-6
Gross Scopes 1, 2, 3 and Total GHG emissions
83
Section
Disclosure requirement
Disclosure requirement name
Location (page #)
Outokumpu Annual Report 2024
60
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Environmental
E1-8
Internal carbon pricing
86
Environmental
E2-1
Policies related to pollution
88
Environmental
E2-2
Actions and resources related to pollution
88
Environmental
E2-3
Targets related to pollution
90
Environmental
E2-4
Pollution of air, water and soil
90
Environmental
E2-5
Substances of concern and substances of very high concern
91
Environmental
E3-1
Policies related to water and marine resources
93
Environmental
E3-2
Actions and resources related to water and marine resources
94
Environmental
E3-3
Targets related to water and marine resources
95
Environmental
E3-4
Water consumption
96
Environmental
E4-1
Transition plan and consideration of biodiversity and ecosystems in strategy and business model
98
Environmental
E4-2
Policies related to biodiversity and ecosystems
99
Environmental
E4-3
Actions and resources related to biodiversity and ecosystems
101
Environmental
E4-4
Targets related to biodiversity and ecosystems
102
Environmental
E4-5
Impact metrics related to biodiversity and ecosystems change
102
Environmental
E5-1
Policies related to resource use and circular economy
104
Environmental
E5-2
Actions and resources related to resource use and circular economy
105
Environmental
E5-3
Targets related to resource use and circular economy
106
Environmental
E5-4
Resource inflows
106
Environmental
E5-5
Resource outflows
107
Section
Disclosure requirement
Disclosure requirement name
Location (page #)
Outokumpu Annual Report 2024
61
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Social
S1-1
Policies related to own workforce
113
Social
S1-2
Processes for engaging with own workers and workers' representatives about impacts
115
Social
S1-3
Processes to remediate negative impacts and channels for own workers to raise concerns
116
Social
S1-4
Taking action on material impacts on own workforce and approaches to mitigating material risks and pursuing material
opportunities related to own workforce and effectiveness of those actions
117
Social
S1-5
Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and
opportunities
119
Social
S1-6
Characteristics of the undertakings employees
121
Social
S1-8
Collective bargaining coverage and social dialogue
123
Social
S1-9
Diversity metrics
123
Social
S1-10
Adequate wages
124
Social
S1-11
Social protection
124
Social
S1-13
Training and skills development metrics
125
Social
S1-14
Health and safety metrics
125
Social
S1-15
Work-life balance metrics
126
Social
S1-16
Compensation metrics (pay gap and total compensation)
126
Social
S1-17
Incidents, complaints and severe human rights impacts
127
Social
S2-1
Policies related to value chain workers
130
Social
S2-2
Processes for engaging with value chain workers about impacts
133
Social
S2-3
Processes to remediate negative impacts and channels for value chain workers to raise concerns
134
Social
S2-4
Taking action on material impacts on value chain workers, and approaches to managing material risks and pursuing
material opportunities related to value chain workers, and effectiveness of those actions
135
Social
S2-5
Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and
opportunities
137
Social
S3-1
Policies related to affected communities
140
Section
Disclosure requirement
Disclosure requirement name
Location (page #)
Outokumpu Annual Report 2024
62
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Social
S3-2
Processes for engaging with affected communities about impacts
142
Social
S3-3
Processes to remediate negative impacts and channels for affected communities to raise concerns
142
Social
S3-4
Taking action on material impacts on affected communities, and approaches to managing material risks and pursuing
material opportunities related to affected communities, and effectiveness of those actions
143
Social
S3-5
Targets related to managing material negative impacts, advancing positive impacts, and managing material risks and
opportunities
143
Governance
G1-1
Business conduct and corporate culture, including actions and targets
145
Section
Disclosure requirement
Disclosure requirement name
Location (page #)
(ESRS 2-IRO-2-56)
List of datapoints that derive from other EU legislation
General information
ESRS 2 GOV-1
Board's gender diversity paragraph 21 (d)
45
General information
ESRS 2 GOV-1
Percentage of board members who are independent paragraph 21 (e)
45
General information
ESRS 2 GOV-4
Statement on due diligence paragraph 30
48
General information
ESRS 2 SBM-1
Involvement in activities related to fossil fuel activities paragraph 40 (d) i
50
General information
ESRS 2 SBM-1
Involvement in activities related to chemical production paragraph 40 (d) ii
not material
General information
ESRS 2 SBM-1
Involvement in activities related to controversial weapons paragraph 40 (d) iii
not material
General information
ESRS 2 SBM-1
Involvement in activities related to cultivation and production of tobacco paragraph 40 (d) iv
not material
Environmental
ESRS E1-1
Transition plan to reach climate neutrality by 2050 paragraph 14
75
Environmental
ESRS E1-1
Undertakings excluded from Paris-aligned benchmarks paragraph 16 (g)
76
Environmental
ESRS E1-4
GHG emission reduction targets paragraph 34
80
Environmental
ESRS E1-5
Energy consumption from fossil sources disaggregated by sources (only high climate impact sectors) paragraph 38
82
Environmental
ESRS E1-5
Energy consumption and mix paragraph 37
82
Environmental
ESRS E1-5
Energy intensity associated with activities in high climate impact sectors paragraphs 40 to 43
82
Environmental
ESRS E1-6
Gross Scope 1, 2, 3 and Total GHG emissions paragraph 44
83
Section
Disclosure requirement
Data point name
Location (page #)
Outokumpu Annual Report 2024
63
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Environmental
ESRS E1-6
Gross GHG emissions intensity paragraphs 53 to 55
86
Environmental
ESRS E1-7
GHG removals and carbon credits paragraph 56
not material
Environmental
ESRS E1-9
Exposure of the benchmark portfolio to climate-related physical risks paragraph 66
not material
Environmental
ESRS E1-9
Disaggregation of monetary amounts by acute and chronic physical risk paragraph 66 (a)
not material
Environmental
ESRS E1-9
Location of significant assets at material physical risk paragraph 66 (c)
not material
Environmental
ESRS E1-9
Breakdown of the carrying value of its real estate assets by energy-efficiency classes paragraph 67 (c)
not material
Environmental
ESRS E1-9
Degree of exposure of the portfolio to climate- related opportunities paragraph 69
not material
Environmental
ESRS E2-4
Amount of each pollutant listed in Annex II of the E-PRTR Regulation (European Pollutant Release and Transfer Register)
emitted to air, water and soil paragraph 28
91
Environmental
ESRS E3-1
Water and marine resources paragraph 9
93
Environmental
ESRS E3-1
Dedicated policy paragraph 13
94
Environmental
ESRS E3-1
Sustainable oceans and seas paragraph 14
not material
Environmental
ESRS E3-4
Total water recycled and reused paragraph 28 (c)
96
Environmental
ESRS E3-4
Total water consumption in m3 per net revenue in own operations paragraph 29
97
General information
ESRS 2- IRO 1 - E4
paragraph 16 (a) i
99
General information
ESRS 2- IRO 1 - E4
paragraph 16 (b)
99
General information
ESRS 2- IRO 1 - E4
paragraph 16 (c)
99
Environmental
ESRS E4-2
Sustainable land / agriculture practices or policies paragraph 24 (b)
not material
Environmental
ESRS E4-2
Sustainable oceans / seas practices or policies paragraph 24 (c)
not material
Environmental
ESRS E4-2
Policies to address deforestation paragraph 24 (d)
not material
Environmental
ESRS E5-5
Non-recycled waste paragraph 37 (d)
108
Environmental
ESRS E5-5
Hazardous waste and radioactive waste paragraph 39
108
Section
Disclosure requirement
Data point name
Location (page #)
Outokumpu Annual Report 2024
64
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Social
ESRS 2- SBM3 - S1
Risk of incidents of forced labor paragraph 14 (f)
113
Social
ESRS 2- SBM3 - S1
Risk of incidents of child labor paragraph 14 (g)
113
Social
ESRS S1-1
Human rights policy commitments paragraph 20
114
Social
ESRS S1-1
Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8,
paragraph 21
114
Social
ESRS S1-1
Processes and measures for preventing trafficking in human beings paragraph 22
114
Social
ESRS S1-1
Workplace accident prevention policy or management system paragraph 23
114
Social
ESRS S1-3
Grievance/complaints handling mechanisms paragraph 32 (c)
116
Social
ESRS S1-14
Number of fatalities and number and rate of work-related accidents paragraph 88 (b) and (c)
126
Social
ESRS S1-14
Number of days lost to injuries, accidents, fatalities or illness paragraph 88 (e)
126
Social
ESRS S1-16
Unadjusted gender pay gap paragraph 97 (a)
126
Social
ESRS S1-16
Excessive CEO pay ratio paragraph 97 (b)
126
Social
ESRS S1-17
Incidents of discrimination paragraph 103 (a)
127
Social
ESRS S1-17
Non-respect of UNGPs on Business and Human Rights and OECD paragraph 104 (a)
127
Social
ESRS 2- SBM3 – S2
Significant risk of child labor or forced labor in the value chain paragraph 11 (b)
129
Social
ESRS S2-1
Human rights policy commitments paragraph 17
131
Social
ESRS S2-1
Policies related to value chain workers paragraph 18
132
Social
ESRS S2-1
Non-respect of UNGPs on Business and Human Rights principles and OECD guidelines paragraph 19
133
Social
ESRS S2-1
Due diligence policies on issues addressed by the fundamental International Labor Organisation Conventions 1 to 8,
paragraph 19
133
Social
ESRS S2-4
Human rights issues and incidents connected to its upstream and downstream value chain paragraph 36
137
Social
ESRS S3-1
Human rights policy commitments paragraph 16
141
Social
ESRS S3-1
Non-respect of UNGPs on Business and Human Rights, ILO principles or and OECD guidelines paragraph 17
142
Social
ESRS S3-4
Human rights issues and incidents paragraph 36
143
Section
Disclosure requirement
Data point name
Location (page #)
Outokumpu Annual Report 2024
65
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Social
ESRS S4-1
Policies related to consumers and end-users paragraph 16
not material
Social
ESRS S4-1
Non-respect of UNGPs on Business and Human Rights and OECD guidelines paragraph 17
not material
Social
ESRS S4-4
Human rights issues and incidents paragraph 35
not material
Governance
ESRS G1-1
United Nations Convention against Corruption paragraph 10 (b)
not material
Governance
ESRS G1-1
Protection of whistleblowers paragraph 10 (d)
not material
Governance
ESRS G1-4
Fines for violation of anti-corruption and anti-bribery laws paragraph 24 (a)
not material
Governance
ESRS G1-4
Standards of anti- corruption and anti- bribery paragraph 24 (b)
not material
Section
Disclosure requirement
Data point name
Location (page #)
(ESRS 2-IRO-2-56)
Based on the results of the double materiality assessment and identified impacts, risks,
and opportunities, Outokumpu conducted data point mapping in order to determine
material data points to be reported on. Disclosures under the material data points are
hence based on material impacts, risks and opportunities identified as part of the double
materiality assessment. In this evaluation the following perspectives were considered: the
significance of the information in relation to the matter it purports to depict or explain; and
the capacity of such information to meet the users’ decision-making needs. (ESRS 2-IRO-2-59)
Outokumpu Annual Report 2024
66
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Environmental information
Outokumpu Annual Report 2024
67
Outokumpu’s environmental strategy
focuses on climate change mitigation:
emissions reduction and energy efficiency,
resource use and the circular economy,
protecting biodiversity and ecosystems,
water resources and pollution prevention.
The EU taxonomy
68
E1 – Climate change
74
E2 – Pollution
87
E3 – Water resources
93
E4 – Biodiversity and ecosystems
98
E5 – Resource use and circular economy
103
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
EU Taxonomy
EU taxonomy reporting
Non-financial companies are required to disclose the share of their sales, and both the
capital and restricted operational expenditure associated with environmentally sustainable
economic activities, as defined in the EU Taxonomy Regulation (2020/852). Eligible
activities are those that are in the scope of the regulation, while an aligned activity is
defined as an eligible economic activity that is making a substantial contribution to at least
one of the climate and environmental objectives, while also doing no significant harm to
the remaining objectives and meeting minimum standards on human rights and labor
standards.
In 2023, the Commission published additional technical screening criteria related to water,
the circular economy, pollution prevention and biodiversity (EU 2023/2486), and
amendments to the previously published Climate Change Mitigation and Adaptation Acts
(EU 2023/2485).
Outokumpu representatives from finance and sustainability have evaluated Outokumpu
activities in relation to the EU taxonomy, resulting in the identification of aligned, eligible
and non-eligible activities. Outokumpu has identified it's steel making activities to be
eligible, in line with economic activity 3.9 “Manufacture of iron and steel” as outlined in
Commission Delegated Regulation (EU) 2021/2139. The key performance indicators were
calculated using the consolidated financial information and further accounting policies are
disclosed after the key performance indicator table below. Full tables are available at the
end of the EU Taxonomy section.
Taxonomy key performance indicators
2024
Total
€ million
Eligible and
aligned, %
Eligible and
non-aligned, %
Non-eligible,
%
Sales (Turnover)
5,942
93
0
7
Capital expenditure
201
78
0
22
Restricted operating expenditure
657
81
0
19
2023
Sales (Turnover)1)
6,961
93
0
7
Capital expenditure
146
75
0
25
Restricted operating expenditure1)
652
81
0
19
1) Percent related data has been revised.
Outokumpu Annual Report 2024
68
Outokumpu’s turnover is 93%
eligible and aligned to the EU
taxonomy. The facade on Neuer
Zollhof, designed by Frank Gehry
and located in Düsseldorf,
Germany, is made of stainless
steel from Outokumpu.
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The preparation of the key performance indicators requires management to make
judgements, estimates and assumptions on eligible and aligned economic activities, capital
expenditure allocated to those activities and related restricted operating expenditure.
Taxonomy sales (turnover) is presented in accordance with IFRS, in line with the sales in
the Group’s consolidated Financial Statements. Outokumpu’s principles for defining sales
(turnover) can be found in note 2.2 in the Group’s consolidated Financial Statements. The
manufacturing of iron and steel is listed as an eligible economic activity.
The company reports its taxonomy eligibility and alignment only for operations; sales from
service centers are excluded from eligibility. The impact of service centers is, however,
insignificant as Group internal sales from mills to service centers are still eligible. Since the
service centers are excluded from eligibility, restricted operating expenditure and capital
expenditure associated with service centers is also excluded from eligibility. The main
items of sales that are considered non-eligible include sales of ferrochrome, raw materials,
other services, and energy. Only eligible activities have been assessed for alignment.
Outokumpu has invested in and holds stakes in energy companies in order to secure low
emission electricity. However, Outokumpu does not hold a direct nuclear ownership; its
ownership is considered immaterial and is not included in the group taxonomy key
performance indicators.
All steelmaking sites have been assessed, and they meet the technical screening criteria
for substantial contribution to climate change mitigation, which requires that the steel
scrap input relative to product output is not lower than 70% in the production of high alloy
steel. In 2022, a first assessment was carried out to ensure that the activities also meet
the criteria set to determine that they do no significant harm (DNSH) to the remaining
objectives. This assessment was reviewed again in 2024, and no changes that affect the
outcome of the evaluation were identified.
•
Criteria for DNSH to climate change adaptation: physical risks material to Outokumpu’s
production units have been screened and assessed and are part of the company’s
overall risk management strategy.
•
Criteria for DNSH sustainable use and protection of water and marine resources and
criteria for DNSH for protection and restoration of biodiversity and ecosystems:
assessment, permits and plans are in place for all production sites, and all sites meet
current legislation.
Outokumpu’s production sites do not use any prohibited substances. In a few activities
where substances of concern are being used, Outokumpu has either considered them
essential since the use is defined as best available technology in the Bref documents, or
nonmaterial as the activity is insignificant compared to total eligible sale, thus meeting the
DNSH criteria for pollution prevention and control.
Outokumpu's human rights due diligence process has been reviewed and is considered
adequate with regards to EU taxonomy minimum safeguards on human rights and labor
standards.
Taxonomy capital expenditure is presented and measured as cash-based. Taxonomy capital
expenditure consists of purchases of property, plant and equipment and purchases of
intangible assets. Taxonomy capital expenditure is presented in accordance with IFRS and
in line with Outokumpu’s consolidated statement of cash flows. Equity investments at fair
value through other comprehensive income and investments in associated companies have
been excluded from the amount. Capital expenditure associated with taxonomy-eligible
economic activities has been considered eligible, while capital expenditure related to the
Ferrochrome business area, service centers, and directly to corporate functions has been
considered non-eligible.
As all steelmaking activities were considered aligned, related capital expenditure was also
considered aligned, since it is necessary to uphold the substantial contribution of the
activities. Currently, plans to expand taxonomy-aligned economic activities, plans to allow
the activities to become taxonomy-aligned, and individual measures enabling the target
activities to become low-carbon have not been separately taken into consideration.
Taxonomy-restricted operating expenditure consists of expenses related directly to
maintenance and servicing of assets, as well as research and development expenses. Of
the total taxonomy-restricted operating expenditure, the portion supporting taxonomy-
eligible economic activities has been considered eligible. Expenses related to the
Ferrochrome business area, service centers, and corporate functions have been considered
non-eligible. Research and development expenses have been included in full and
considered eligible except for the part related to the manufacturing of ferrochrome, service
centers and corporate.
Only one taxonomy-eligible economic activity has been identified as relevant and taken into
account in the calculations, together with one environmental objective. While recycling of
metallic scrap is at the core of Outokumpu’s business, the collection and sorting of scrap
as outlined in the circular economy criteria document is not considered an economic
activity in itself for Outokumpu. Outokumpu continues to develop its calculations and
definitions as new information becomes available.
Outokumpu Annual Report 2024
69
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Taxonomy turnover, capital expenditure and operational expenditure
Taxonomy key performance indicators – Turnover 1)
Financial year 2024
2024
Substantial Contribution criteria
DNSH criteria
(“Does Not Significantly Harm”)
Economic activities
Code
Turnover
Proportion
of
Turnover,
2024
Climate Change
Mitigation
Climate Change
Adaptation
Water
Pollution
Circular Economy
Biodiversity
Climate Change
Mitigation
Climate Change
Adaptation
Water
Pollution
Circular Economy
Biodiversity
Minimum
safeguards
Proportion
of Taxonomy-
aligned (A.1)
or
- eligible (A.2)
turnover,
2023
Category
enabling
activity
Category
transitional
activity
EUR
(millions)
%
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A . TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
Manufacturing of iron and steel
3.9
5,534
93 %
Y
N/EL
N/EL
N/EL
N/EL
N/EL
Y
Y
Y
Y
Y
Y
93 %
T
Turnover of environmentally sustainable
activities (Taxonomy-aligned) (A.1.)
5,534
93 %
93 %
0 %
0 %
0 %
0 %
0 %
Y
Y
Y
Y
Y
Y
93 %
Of which enabling
0
0 %
0 %
0 %
0 %
0 %
0 %
0 %
Y
Y
Y
Y
Y
Y
0 %
E
Of which transitional
5,534
93 %
93 %
Y
Y
Y
Y
Y
Y
93 %
T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
Manufacturing of iron and steel
3.9
0
0 %
EL
N/EL
N/EL
N/EL
N/EL
N/EL
0 %
Turnover of Taxonomy-eligible but not
environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2)
0
0 %
0 %
0 %
0 %
0 %
0 %
0 %
0 %
A. Turnover of Taxonomy-eligible
activities (A.1+A.2)
5,534
93 %
93 %
0 %
0 %
0 %
0 %
0 %
93 %
B. TAXONOMY-NON-ELIGIBLE
ACTIVITIES
Turnover of Taxonomy-non-eligible
activities
408
7 %
TOTAL
5,942
100 %
Taxonomy turnover total is presented in accordance with IFRS, in line with the sales in the Group’s consolidated statement of income in the Financial Statements. Outokumpu’s principles for defining turnover (sales) can be
found in note 2.2 in the Group’s Financial Statements. The manufacturing of iron and steel is listed as an eligible economic activity.
1) Comparative data has been revised.
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Taxonomy key performance indicators – Capital expenditure (CapEx)
Financial year 2024
2024
Substantial Contribution criteria
DNSH criteria
(“Does Not Significantly Harm”)
Economic activities
Code
CapEx
Proportion
of CapEx,
2024
Climate Change
Mitigation
Climate Change
Adaptation
Water
Pollution
Circular Economy
Biodiversity
Climate Change
Mitigation
Climate Change
Adaptation
Water
Pollution
Circular Economy
Biodiversity
Minimum
safeguards
Proportion
of Taxonomy-
aligned (A.1)
or
- eligible (A.2)
CapEx, 2023
Category
enabling
activity
Category
transitional
activity
EUR
(millions)
%
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A . TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
Manufacturing of iron and steel
3.9
157
78 %
Y
N/EL
N/EL
N/EL
N/EL
N/EL
Y
Y
Y
Y
Y
Y
75 %
T
CapEx of environmentally sustainable activities
(Taxonomy-aligned) (A.1.)
157
78 %
78 %
0 %
0 %
0 %
0 %
0 %
Y
Y
Y
Y
Y
Y
75 %
Of which enabling
0
0 %
0 %
0 %
0 %
0 %
0 %
0 %
Y
Y
Y
Y
Y
Y
0 %
E
Of which transitional
157
78 %
78 %
Y
Y
Y
Y
Y
Y
75 %
T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
Manufacturing of iron and steel
3.9
0
0 %
EL
N/EL
N/EL
N/EL
N/EL
N/EL
0 %
CapEx of Taxonomy-eligible but not
environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2)
0
0 %
0 %
0 %
0 %
0 %
0 %
0 %
0 %
A. CapEx of Taxonomy-eligible
activities (A.1+A.2)
157
78 %
78 %
0 %
0 %
0 %
0 %
0 %
75 %
B. TAXONOMY-NON-ELIGIBLE
ACTIVITIES
CapEx of Taxonomy-non-eligible
activities
44
22 %
TOTAL
201
100 %
Taxonomy capital expenditure is presented and measured as cash-based. Taxonomy capital expenditure consists of purchases of property, plant and equipment and purchases of intangible assets. Taxonomy capital
expenditure is presented in accordance with IFRS and in line with Outokumpu’s statement of cash flows. Equity investments at fair value through other comprehensive income and investments in associated companies have
been excluded from the amount. Capital expenditure associated with taxonomy-eligible economic activities has been considered eligible while capital expenditure related to the Ferrochrome business area, service centers
and directly to corporate functions has been considered non-eligible.
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Taxonomy key performance indicators – Restricted operating expenditure (OpEx)1)
Financial year 2024
2024
Substantial Contribution criteria
DNSH criteria
(“Does Not Significantly Harm”)
Economic activities
Code
OpEx
Proportion
of CapEx,
2024
Climate Change
Mitigation
Climate Change
Adaptation
Water
Pollution
Circular Economy
Biodiversity
Climate Change
Mitigation
Climate Change
Adaptation
Water
Pollution
Circular Economy
Biodiversity
Minimum
safeguards
Proportion
of Taxonomy-
aligned (A.1)
or
- eligible (A.2)
OpEx, 2023
Category
enabling
activity
Category
transitional
activity
EUR
(millions)
%
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y;N;
N/EL
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
Y/N
%
E
T
A . TAXONOMY-ELIGIBLE ACTIVITIES
A.1. Environmentally sustainable activities (Taxonomy-aligned)
Manufacturing of iron and steel
3.9
531
81 %
Y
N/EL
N/EL
N/EL
N/EL
N/EL
Y
Y
Y
Y
Y
Y
81 %
T
OpEx of environmentally sustainable activities
(Taxonomy-aligned) (A.1.)
531
81 %
81 %
0 %
0 %
0 %
0 %
0 %
Y
Y
Y
Y
Y
Y
81 %
Of which enabling
0
0 %
0 %
0 %
0 %
0 %
0 %
0 %
Y
Y
Y
Y
Y
Y
0 %
E
Of which transitional
531
81 %
81 %
Y
Y
Y
Y
Y
Y
81 %
T
A.2 Taxonomy-eligible but not environmentally sustainable activities (not Taxonomy-aligned activities)
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
EL;
N/EL
Manufacturing of iron and steel
3.9
0
0 %
EL
N/EL
N/EL
N/EL
N/EL
N/EL
0 %
OpEx of Taxonomy-eligible but not
environmentally sustainable activities (not
Taxonomy-aligned activities) (A.2)
0
0 %
0 %
0 %
0 %
0 %
0 %
0 %
0 %
A. OpEx of Taxonomy-eligible
activities (A.1+A.2)
531
81 %
81 %
0 %
0 %
0 %
0 %
0 %
81 %
B. TAXONOMY-NON-ELIGIBLE
ACTIVITIES
OpEx of Taxonomy-non-eligible activities
126
19 %
TOTAL
657
100 %
Taxonomy-restricted operating expenditure consists of expenses related directly to maintenance and servicing of assets, as well as research and development expenses. Of the total taxonomy-restricted operating
expenditure, the portion supporting taxonomy-eligible economic activities has been considered eligible. Expenses related to the Ferrochrome business area, service centers, and corporate functions have been considered
non-eligible. Research and development expenses have been included in full and considered eligible except for the part related to the manufacturing of ferrochrome, service centers and corporate.
1) Comparative data has been revised.
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Nuclear and fossil gas related templates
Row
Nuclear energy related activities
1
The undertaking carries out, funds or has exposures to research, development,
demonstration and deployment of innovative electricity generation facilities
that produce energy from nuclear processes with minimal waste from the fuel
cycle.
No
2
The undertaking carries out, funds or has exposures to construction and safe
operation of new nuclear installations to produce electricity or process heat,
including for the purposes of district heating or industrial processes such as
hydrogen production, as well as their safety upgrades, using best available
technologies.
No
3
The undertaking carries out, funds or has exposures to safe operation of
existing nuclear installations that produce electricity or process heat, including
for the purposes of district heating or industrial processes such as hydrogen
production from nuclear energy, as well as their safety upgrades.
No
Fossil gas related activities
4
The undertaking carries out, funds or has exposures to construction or
operation of electricity generation facilities that produce electricity using fossil
gaseous fuels.
No
5
The undertaking carries out, funds or has exposures to construction,
refurbishment, and operation of combined heat/cool and power generation
facilities using fossil gaseous fuels.
No
6
The undertaking carries out, funds or has exposures to construction,
refurbishment and operation of heat generation facilities that produce heat/
cool using fossil gaseous fuels
No
Due to insignificant ownership in nuclear and fossil related activities, Outokumpu does not do further
analysis on related activities.
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E1 – Climate change
Climate change, including energy and climate change mitigation, was identified as material
for Outokumpu in its double materiality assessment.
Material impacts, risks and opportunities resulting from
the materiality assessment
E 1.1 Energy
Impacts
Negative
Outokumpu’s stainless steel production consumes significant amounts of energy. In
addition, raw material extraction in upstream and transportation increase energy
demand and its associated impact. These are actual negative impacts valid in direct
operations and in the upstream value chain.
Risks and
opportunities
Opportunity
Outokumpu has initiated an energy efficiency program to reduce its energy
consumption. The increased utilization of waste heat also contributes to better energy
efficiency and related cost reductions. This opportunity is valid in direct operations.
Risk
Due to the energy-intensive production process of stainless steel, the volatility of
energy prices presents a financial risk. The company also sees the availability and
price of renewable fuels as a material risk for the transition. This risk is valid in direct
operations.
E 1.2 Climate change mitigation
Impacts
Positive
Outokumpu has achieved a significant reduction in its upstream value chain emission
intensity by using recycled raw materials and low-emission energy in its production. The
company aims to further reduce its emission intensity by energy efficiency, switching
fossil coke to biocoke, increasing renewable energy use and investigating carbon
capture. This is an actual positive impact valid in direct operations.
Negative
Outokumpu’s stainless steel production, including mining in the upstream, consumes
significant amounts of energy, which also contributes to greenhouse gas emissions.
This is actual negative impact valid in direct operations and in upstream value chain.
Risks and
opportunities
Opportunity
Outokumpu is a front-runner in low-emission stainless steel production, which has a
clear demand in the market. Regulation, through the EU’s Carbon Border Adjustment
Mechanism, aims to limit carbon leakage in Europe, which could be a competitive
advantage for producers with a low carbon footprint. This opportunity is valid in direct
operations.
Risk
The estimated increase in carbon pricing presents a financial cost to the company
from its direct emissions through the European Emission Trading System and the
viability of decarbonization technologies. This risk is valid in direct operations.
(ESRS 2-SMB 3-48-(a))
Outokumpu Annual Report 2024
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Climate change is the biggest challenge of our
time. Outokumpu has committed to the science-
based climate target of limiting global warming
below 1.5°C. The company accelerates the green
transition through its products’ low carbon
footprint and by supporting customers in reducing
their emissions.
TARGETS
Reduce direct, indirect and
supply chain emission
intensity by
42%
by 2030 from a 2016
baseline
Energy efficiency run-rate
target to improve
600 GWh
by end of 2024 from
January–September 2022
baseline
PROGRESS
Reduced emission intensity
across direct, indirect and
supply chain altogether
32%
by end of 2024 from a
2016 baseline
Energy efficiency run-rate
improved
391 GWh
by end of 2024 from
January–September 2022
baseline
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Strategy
Transition plan for climate change mitigation
Outokumpu is committed to climate targets targeting to keep global warming below 1.5°C
in line with the Paris Agreement and aims to achieve carbon neutrality by 2050.
Outokumpu prepared its decarbonization roadmap towards this target in 2021. Since then,
the company has continuously assessed the decarbonization roadmap, and during 2024,
Outokumpu developed an updated roadmap and the transition plan to mitigate climate
change as an integral part of its strategy and business plan. (E1-1-14) Detailed below are
the various elements constituting Outokumpu’s transition plan.
Greenhouse gas emission reduction targets
Sustainability, including decarbonization, is at the core of Outokumpu’s strategy. As
mentioned earlier in the Strategy section of the report, in the second phase of the strategy,
Outokumpu conducts targeted decarbonization investment while preparing to evaluate new
opportunities for sustainable growth through innovation and clean business models in the
coming years.
Outokumpu targets reducing carbon emission intensity across Scope 1, Scope 2 and Scope
3 by 42% by 2030 from a 2016 baseline. The target has been set according to the cross-
sectoral pathway. Outokumpu’s stainless steel has an up to 75% lower carbon footprint
than the industry average, and recent innovations like Circle Green, with an up to 93%
lower carbon footprint in the industry*, help customers reduce their emissions.
Outokumpu is exposed to coal and gas-related activities mainly through the use of coke as a
reductant in the ferrochrome process and through the use of natural gas as fuel in the
stainless steel process. The exposure to fossil coke, as well as fossil gas, is expected to
decrease, as Outokumpu’s transition plan includes a gradual switch to bio-based coke, as well
as biofuels. Exposure to oil-related activities is not material and is expected to decrease
further, as exemplified by the fuel switches started from light fuel oil to natural gas. (E1-1-16-(a))
Decarbonization levers
Outokumpu’s key decarbonization levers in the transition plan are:
•
increasing use of scrap,
•
improved energy efficiency and yield,
•
increasing low-carbon energy,
•
increasing use of alternative fuels and electrification,
•
use of biocoke,
•
increasing low-emission primary raw materials, and
•
carbon capture and storage/utilization.
Ongoing and planned actions that align with these listed decarbonization levers can be
found under E1-3 in the action and resources section below. E1-1-16-(b))
* Global average carbon footprint of stainless steel: (2024):7 kg CO₂e per kg of stainless steel
(Outokumpu’s calculation based on data provided by CRU, worldstainless and Kobolde & Partners AB).
Outokumpu Circle Green product carbon footprint: down to 0.5 kg of CO₂e per kg of stainless steel.
Investments and funding
To be able to attain the 1.5°C aligned climate target, the company has created and
committed to a transition plan. Outokumpu has already invested in energy efficiency, low-
carbon energy and biocoke EUR 48.5 million since revising its climate target in 2021. The
company has decided to further invest EUR 78 million in the following years on operational
decarbonization initiatives, energy efficiency and biocoke. The company continues to
evaluate the transition investments required by 2030 as well as evaluating the operational
expenditure related to the transition plan. Read more about key actions in 2024 under
Actions and resources section, “Key Actions”, in this chapter.
In 2024, about EUR 5 million of the EUR 78 million reported as EU taxonomy eligible
capital expenditure, were related to projects in the transition plan. The investments related
to biocoke support reducing significant amount of Outokumpu’s direct emissions, but the
capital expenditure is not included in the EU eligible taxonomy KPI since the ferrochrome
manufacturing process is not taxonomy-eligible. (E1-1-16-(c)
Assessment of locked-in greenhouse gas emissions
Outokumpu has conducted a qualitative assessment of potential locked-in fossil
greenhouse gas emissions from its key assets and products, as well as from the company’s
value chain, in 2024. The findings indicate that part of the coke- and lime-related
emissions are seen as locked-in. These locked-in emissions are not foreseen to constitute
any material risk for Outokumpu’s transition journey, as they do not jeopardize
Outokumpu’s science based target. (E1-1-16-(d))
Alignment with Commission’s delegated regulation 2021/2139
In terms of any objective or plans for aligning further economic activities with criteria
established in Commission-delegated regulation 2021/2139, there are no current plans,
since all Outokumpu’s economic eligible activities are expected to stay aligned with the
regulation. (E1-1-16-(e))
Capital expenditure in coal, oil and gas-related economic activities
In 2024, Outokumpu’s capital expenditure in oil-related economic activities was EUR 0
million, in gas-related activities EUR 0 million, and in coal-related activities EUR 0 million.
Total capital expenditures including decarbonization and EU Taxonomy related investments
are presented in earlier sections. (E1-1-16-(f))
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EU Paris-aligned benchmarks
Outokumpu derives its revenue mainly from steel manufacturing and is thus not excluded
from the EU Paris-aligned benchmarks. (E1-1-16-(g))
Alignment with strategy and financial planning
Decarbonization is an integral part of Outokumpu’s strategy, in line with the company’s
overall vision of being the customer’s first choice in sustainable stainless steel.
Sustainability, including decarbonization, is at the core of Outokumpu’s three-phased
strategy. During the first phase, starting in 2021, the company made the commitment to
keep global warming below 1.5°C and created the decarbonization roadmap. The second
phase of the strategy continues until 2025 focusing on strengthening the core through
sustainability, growth from productivity and customer-focused steering. The third phase of
the strategy is planned to commence from 2026 and the focus in the third phase is to
strengthen Outokumpu’s market position further and to develop more globally diversified
operations including Americas expansion, European competitiveness, value-chain
integration, and sustainability leadership. In the third phase, the company aims to create
competitive advantage through clean investments to decarbonization aligned with its
transition plans and through offering low-emission solutions. More information can be found
in the Strategy section in the General information chapter.
As part of its financial planning, carbon price has been embedded in all investment
decisions at Outokumpu, and the company has continued targeted investments to
decarbonize its value chain. The company has committed to a transition plan and has
already invested EUR 48.5 million to decarbonization and decided on investments
amounting to EUR 78 million in the coming years. As part of its strategy preparation,
Outokumpu continues to evaluate the future investments to decarbonization. (E1-1-16-(h))
Approval by administrative and management bodies
Outokumpu’s science-based climate target was set in 2021, and proposed by the CEO and
approved by the Board of Directors. The transition plan was approved by the ESG Steering
Group in 2024. It has not been separately approved by the management and supervisory
bodies, but CEO and Board of Directors approve the action plans related to the transition
plan as part of the company’s strategy process and the transition plan is reviewed as part
of preparing the Sustainability statement. The role of the administrative and management
bodies is disclosed in more detail in the General information chapter. Outokumpu also has
an external ESG Advisory Council supporting the company in all sustainability areas
including assessing the company’s pathway to decarbonization. (E1-1-16-(i))
Progress in implementing the transition plan
By end of 2024, Outokumpu achieved 32% greenhouse gas emission intensity reduction
from the 2016 baseline, demonstrating that the company is ahead of its SBTi target, which
is aligned with the implementation of Outokumpu’s transition plan. This was achieved
through high use of recycled steel as raw material, low-carbon energy, and incremental
improvements in operations, reaching lower emission intensity than set in the transition
plan. Read more about the progress in Metrics and targets, below in this chapter.
(E1-1-16-(j))
Material climate change-related impacts,
risks and opportunities, and their interaction with
the strategy and business model
Climate-related risks
Outokumpu has assessed the actual or potential impact of climate in its double materiality
assessment, in connection with the company’s strategy and business model. Most of the
potential impact arises from the nature of its key activity, stainless steel production, which
is energy-intensive. The company has, however, reduced that impact significantly over the
years, which presents a competitive advantage in low-carbon stainless steel.
Outokumpu identified the following climate transition risks, related to Outokumpu’s
business model and strategy:
•
decarbonization technologies and investments not being viable and effective enough to
meet emission reduction targets,
•
new regulations and technologies needed for transition could increase production costs,
•
availability and price of low-emission raw materials and energy,
•
energy cost constituting a substantial part of the total steel manufacturing costs, and
the vulnerability of energy-intensive operations to fluctuations in energy prices.
Outokumpu considers the climate-related risks it has identified to be climate-related
transition risks. Climate-related physical risks were not considered material for Outokumpu.
(E1-ESRS 2 SBM-3-18)
Resilience of its strategy and business model
Climate resilience is at the core of Outokumpu’s strategy and operations. While the
resilience analysis fulfilling the requirements from CSRD has not been conducted yet,
Outokumpu initially analyzed the resilience of its strategy and business model during the
double materiality assessment. The company continues to further assess the climate
resilience of its strategy and operations in the future. (E1-ESRS 2 SBM-3-19-(a)) Outokumpu
has analyzed its transition risks based on Task Force on Climate-related Financial
Disclosures (TCFD) when committing to science-based targets in 2021. (E1-ESRS 2 SBM-3-19-
(b)), (E1-ESRS 2 SBM-3-AR 7-(a)
On short-term, Outokumpu has adjusted its business model to offer low-emission stainless
steel as a solution to reduce other industries’ climate impact. On medium-term the
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company has the ability to build more resilience through its decarbonization commitment,
and innovate new solutions to tackle climate change. On long-term, the company aims to
gain leadership in sustainability and value chain integration alongside strengthening its
market position, which includes investments to green transition and adjusting the business
model. E1-ESRS 2 SBM-3-AR 8-(b))
Based on the earlier assessment, due to its low-carbon footprint and high use of recycled
raw materials, the company has built resilience against climate-related transition risks.
Outokumpu is further committed to the science-based target by 2030 and reduce its
transition risk by implementing low-carbon technologies, and increasing the use of clean
energy in its product portfolio. There are uncertainties related to new technologies,
regulation on climate change such as carbon pricing as well as the demand for low-
emission products. (E1-ESRS 2 SBM-3-19-(c), E1-ESRS 2 SBM-3-AR 7-(b), (E1-ESRS 2 SBM-3-AR 8-(a))
Impact, risk and opportunity
management
Policies
Policies related to climate change mitigation
and adaptation
Outokumpu’s Sustainability Policy outlines the company’s sustainability principles and
goals, in relation to the sustainability of the economic, environmental, and social aspects.
The main principles of the policy outline that sustainability has a central role in
Outokumpu’s vision, strategy and planning. The principles include acting safely for the
employees and the company’s stakeholders, respecting human rights, and committing to
increasing diversity, equity and inclusion. The company is committed to keeping global
warming below 1.5°C and provides low-emission solutions to customers. Outokumpu
manages material sustainability matters by embedding the circular economy to the core of
its business by utilizing over 90% recycled steel to reduce dependence on primary raw
materials. This also reduces greenhouse gas emissions and mitigates biodiversity loss,
which Outokumpu is also considering in its decision-making. The company employs risk-
based environmental management to actively minimize waste, pollution, and water use,
with reuse practices and targeted conservation in high-risk regions. Outokumpu also
supports safe product use through transparent handling information and phases out
harmful substances wherever feasible. The company is committed to conducting business
with high integrity, by making responsible, sustainable, and ethical decisions. The company
operates based on its key ethical principles, the Outokumpu Code of Conduct, and other
company policies and instructions, as well as Ways of Working, which form the basis of
Outokumpu’s actions, operations, and corporate culture. (E1-2-25), (E1-MDR-P-62)
Key contents of the policy
The Sustainability Policy includes topics on climate change mitigation, adaptation, energy
efficiency, and renewable energy deployment, and outlines steps to reach carbon neutrality.
Outokumpu’s Sustainability Policy states that Outokumpu helps its customer to tackle
climate change through lower-emission solutions, creating value for the company, society,
and the environment. Through the policy, Outokumpu commits to take climate change
seriously, acknowledges the need for a just transition, and operates according to long-term
climate targets based on science. Outokumpu’s transition plan states targets and steps to
reach the long-term target of carbon neutrality by 2050. (E1-MDR-P-65-(a))
Scope, accountability, stakeholders, and availability
The Sustainability Policy must be followed globally by all Outokumpu businesses,
companies, directors, officers and employees. In addition, Outokumpu also expects its
business partners across the value chain to follow similar standards to those outlined in
the Sustainability Policy. (E1-MDR-P-65-(b)) The CEO and the Executive Vice President,
Strategy, Sustainability and People is accountable for the implementation of the policy. (E1-
MDR-P-65-(c)) Outokumpu includes the views of stakeholders such as shareholders,
employees, customers, suppliers, investors and authorities, as well as public and non-
governmental organizations, as part of its policy management. The public policies are also
available for external stakeholders on Outokumpu’s website. (E1-MDR-P-65-(e)) The policy
requires Outokumpu to strive for a continuous, systematic, and open dialogue through
engaging with stakeholders. (E1-MDR-P-65-(f))
Third-party standards
Outokumpu is committed to the UN Sustainable Development Goals and is also a signatory
member of the UN Global Compact. The company is committed to the Business Ambition of
1.5°C Objective by 2050 and is a member of the Science Based Targets initiative.
Outokumpu is also a member of the ResponsibleSteel initiative and committed to
supporting its vision and mission. Outokumpu also has ResponsibleSteel certification for all
its manufacturing sites in Europe, and all Outokumpu production sites are ISO 14001-
certified. As a chromium mining operator, Outokumpu is a member of the Finnish Network
for Sustainable Mining. (E1-MDR-P-65-(d))
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Addressing material areas
Climate change mitigation
The Sustainability Policy includes climate change mitigation and outlines steps to reach
carbon neutrality. The policy includes actions to reduce greenhouse gas emissions both in
our own operations and in the supply chain, as well as improving energy efficiency and the
use of renewable energy. The policy also guides minimizing the use of primary raw materials
by replacing them with circular materials as one of the key actions to mitigating climate
impact.
In addition, Outokumpu’s Supplier Code of Conduct also addresses climate change by
expecting suppliers to reduce the negative impacts of their operations on the environment,
and especially on climate. More information about Outokumpu’s Supplier Code of Conduct
and it’s scope, the approval process, disclosure of third-party standards, consideration
given to key stakeholders, and the availability of the policy, can be found in the Workers in
the value chain (S2) chapter in the Policies section. (E1-2-25-(a))
Energy efficiency
As stated in Outokumpu's Sustainability Policy, Outokumpu aims to minimize the use of
resources and the negative impact of its operations on the surrounding environment by
proactively developing its production processes and its energy and material efficiency. This
means that Outokumpu continuously optimizes energy use and proactively develops and
improves energy efficiency to help reduce its impact on the environment. (E1-2-25-(c))
Renewable energy deployment
As part of its Sustainability Policy, Outokumpu minimizes the negative impacts of its
operation on the environment by increasing the share of low-carbon electricity, which is one
of the key elements in Outokumpu’s transition plan. The low carbon electricity includes
both renewable and nuclear energy. Outokumpu is also taking steps to replace its fossil
fuels with alternative solutions such as biofuels and electrification. (E1-2-25-(d))
Other
The Sustainability Policy also addresses biodiversity and its dependence on climate
change. By reducing greenhouse gas emissions and virgin resource material dependency,
Outokumpu contributes to maintaining biodiversity globally. In addition, the policy outlines
Outokumpu’s aim of reducing pollution, waste, and emissions to air, and reducing
environmental impacts through risk-based environmental management. (E1-2-25-(e))
Actions and resources
Actions and resources related to
climate change policies
Key actions
Outokumpu has identified and implemented key actions to mitigate climate change, and
both operational and financial resources have been reserved for them. During 2024,
Outokumpu continued to execute its decarbonization roadmap.
Decarbonization levers, key actions and expected outcomes during the reporting year were:
•
continue high use of scrap with the outcome to reduce emissions from raw materials
and reduce virgin raw material dependency,
•
execute energy efficiency initiatives to reduce emissions related to energy use and
financial costs,
•
securing availability of low-emission electricity through PPA’s and certificates to reduce
emissions from energy use,
•
switching from fossil fuels to alternative fuels to reduce emissions from energy, and
•
investment decisions on a biocarbon plant in Germany to reduce emissions from coke
Decarbonization levers, key actions and expected outcomes in the following reporting years
are:
•
securing low-emission raw materials through partnerships to further reduce emissions
from virgin raw materials,
•
additional investments in biocoke to reduce emissions from coke,
•
additional operational changes from fossil fuels to alternative fuels and electrification to
reduce emissions from energy, and
•
carbon capture and utilization to reduce emissions from CO₂ and CO gas and potentially
support other industries to reduce emissions through utilization of waste streams.
Execution of these actions are also outlined in Outokumpu’s transition plan and are crucial
to meet Outokumpu’s science-based emission reduction target as outlined in its
Sustainability Policy objectives and targets. Outokumpu also participated in a three-year
program towards carbon neutral metals TOCANEM2, which supports the metal industry’s
transition towards carbon neutrality. (E1-MDR-A-68-(a)), (E1-3-29-(a))
Scope and time horizon
Actions to reduce greenhouse gas emissions cover Outokumpu’s value chain, focusing
especially on the direct operations and supply chain where majority of the company’s
emissions are generated and in all geographical areas the company either operations in or
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are part of its upstream supply chain. If an action applies specifically to a particular
location, this is explicitly stated. For example, the biocoke agglomeration plant in Tornio is
specific to that site. Additionally, actions such as building partnerships with suppliers
extend to the upstream value chain of Outokumpu, demonstrating coverage beyond the
company’s direct operations. (E1-MDR-A-68-(b)) As the decarbonization technologies develop,
the company assesses the expected time horizons for each key action continuously. The
high use of scrap, low-emission raw materials and low-emission energy are a continuous
effort especially on the short-term, whereas the current biocoke investments reported are
for mid-term. Carbon capture and storage/utilization is in research phase and to be
evaluated further. As a general rule, Outokumpu applies the same definition of short-,
medium- and long-term as in the Corporate Sustainability Reporting Directive (“CSRD”):
short-term is one year, mid-term is up to five years, and long-term is more than five years.
(E1-MDR-A-68-(c)) None of the actions were related to any provision of remedy since there
was no harm to society from actual material impacts (E1-MDR-A-68-(d))
Prior progress
By the end of 2023, Outokumpu had improved its emissions intensity by 27% from the
2016 baseline. (E1-MDR-A-68-(e))
Financial resources
Since revising its climate target in 2021, Outokumpu has invested capital expenditures of
EUR 48.5 million in decarbonization and has decided to invest a further EUR 78 million in
the following years. The company continues to evaluate investments required by 2030, as
well as possible subsidies and other financing instruments to execute its decarbonization
targets. (E1-MDR-A-69-(a)) Outokumpu’s mid-term targets are based on existing, cost-efficient
decarbonization technologies, and the company has taken resource allocation into account
as part of its strategy process. In the long-term, Outokumpu sees decarbonization as
generating value in its business and enabling the achievement of the transition plan. (E1-3
AR 29)
Outokumpu’s current operating expenses to implement actions taken are included in the
expenses disclosed in the consolidated statement of income and in Note 2.3. Any related
current capital expenditures is part of the line item Additions in Note 4.1 Intangible assets
and property, plant and equipment. (E1-MDR-A-69-(b)) The company has not yet made any
future allocation of financial resources. (E1-MDR-A-69-(c))
Achieved and expected GHG emission reductions
By the end of the reporting year, Outokumpu achieved a 32% reduction in CO₂ emissions
intensity against the 2016 baseline. The expected CO₂ emission intensity reduction
according to target was 24% in 2024. Expected emission intensity reduction until 2030 is
42%, which corresponds additionally to approximately 1 Mt CO₂ in absolute emissions.
(E1-3-29-(b))
Resource dependence in action implementation
According to its strategy disclosed earlier, Outokumpu has gained a strong financial
position with a strong balance sheet to prepare the company for future investments.
Decarbonization is an integral part of the company’s value creation, and so the investments
to mitigate climate change are also seen as a significant opportunity for the company
success in the future. For example, within the biocoke investment, Outokumpu also sees
the financial profitability as well as potential new value creation. In addition to its own
capital expenditure investments, the company also considers national and EU funds to
decarbonize the industry. (E1-3-AR 21)
Capital expenditure and operational expenditure relationships
In 2024, Outokumpu invested EUR 21.5 million of capital expenditures in its transition
plan, consisting of energy efficiency and biocoke investments. In addition, the company
made additional operational investments, following changes in operating methods. These
are not disclosed as separate line items in the Financial Statements. The investments
made and planned for the transition plan are disclosed under Financial resources. (E1-3-29
(c-i))
In terms of capital and operational expenditure required to implement the actions taken or
planned, the majority of Outokumpu's operative and capital spend is eligible (in the sense
of EU 2021/2178), and it mainly excludes spend in the Ferrochrome business area, as the
relevant scope is manufacturing of iron and steel (E1-3-29 (c-ii))
Metrics and targets
Targets related to climate change mitigation and
adaptation
Relationship with policy objectives
As outlined in Outokumpu’s Sustainability Policy, Outokumpu acknowledges the need for a
just transition and operates according to long-term targets based on science. The transition
plan shows initiatives and steps to both mid-term target by 2030 and towards carbon
neutrality by 2050. While the science-based targets address mitigating climate change,
Outokumpu has also established a target for energy efficiency in direct operations. (E1-MDR-
T-80-(a))
Measurable targets
Outokumpu has set measurable targets for greenhouse gas emissions reduction and energy
efficiency improvement. The greenhouse gas emissions reduction target is a relative target
of a 42% reduction per tonne of crude steel (measured in CO₂/tonne crude steel) by 2030,
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based on the 2016 baseline. The energy efficiency target is 8% improved energy efficiency
expressed as run-rate improvement from baseline in 2022, measured in GWh. Outokumpu’s
climate target of reducing greenhouse gas emissions is relative, measuring the intensity per
tonne of crude steel. The energy efficiency target is an absolute reduction from the
baseline. (E1-MDR-T-80-(b))
Scope and baseline year
The target of reducing emission intensity includes emissions in all three scopes: direct
emissions (Scope 1) and indirect and value chain emissions (Scopes 2 and 3). The energy
efficiency target covers Outokumpu’s own operations. (E1-MDR-T-80-(c))
To be as representative as possible, the current baseline for the emission intensity
reduction target is set as an average of three consecutive years, which are 2014, 2015
and 2016. Based on this, the baseline emission intensity value is 2.1 tCO2/tonne of crude
steel. The base year for the energy efficiency target is January-September 2022, and the
baseline value is 5,404 GWh. (E1-4-MDR-T-80-(d))
Milestones
Outokumpu’s climate targets span until 2050. Outokumpu’s mid-term greenhouse gas
emissions intensity target is set by 2030, which is then broken down into short-term,
annual targets that are executed by the business areas and functions. The company also
has a short-term target for energy-efficiency which is set for 2025. The Kemi mine’s carbon
neutrality target is also set for 2025. (E1-MDR-T-80-(e))
Methodologies and assumptions
To set the greenhouse gas emissions reduction target, Outokumpu has performed a climate
scenario analysis according to the stated policies scenario, and a sustainable development
scenario analysis in line with the 1.5°C ambition of the Science Based Targets initiative.
The energy efficiency target is measured in cumulative run-rate improvement from the
baseline, measured in GWh. (E1-MDR-T-80-(f))
Target’s scientific evidence and target setting
The greenhouse gas emissions intensity reduction mid-term target is science-based, and
the energy efficiency target is relative to past performance. (E1-MDR-T-80-g)) The GHG
emissions target has been reviewed and approved externally by the Science Based Targets
initiative, while the energy efficiency target has not been assessed by external
stakeholders. (E1-MDR-T-80-(h))
Changes in targets and metrics
Greenhouse gas emission calculation is based on emission factors that are reviewed
annually. In the reporting period, its scope was enlarged beyond Outokumpu’s production
units to include service centers, warehouses and offices. For the science-based emission
intensity target set in 2021, Outokumpu has not made any changes during the reporting
year, since other emissions were considered insignificant in the steel production process.
(E1-MDR-T-80-(i))
Performance against disclosed targets
By the end of 2024, Outokumpu reduced its emission intensity by 32% from the 2016
baseline. This was enabled through high recycled material content, low-carbon energy and
operational improvements. In energy efficiency, the company achieved a run-rate
improvement of 391 GWh during the year, out of a total target of 600 GWh. (E1-MDR-T-80-(j))
Management of material climate-related impacts,
risks and opportunities through targets
Outokumpu’s climate targets are science-based, aligned with the aim of limiting the
increase in the global average temperature to 1.5°C above pre-industrial levels in line with
the Paris Agreement. To reach this target, Outokumpu aims to decrease direct (Scope 1)
and indirect emissions (Scope 2) as well as emissions from the supply chain (Scope 3) by
42% per tonne of stainless steel by 2030 compared to the 2016 baseline. Outokumpu’s
energy efficiency target was set based on identifying potential measures to improve energy
efficiency across the company’s operations targeting an ambitious energy efficiency
improvement. (E1-4-33)
Greenhouse gas emissions target and inventory boundaries
Expected emission reductions from 2016 to 2030 (tCO2/tCS)
(E1-4-34-(a)
Outokumpu Annual Report 2024
80
2.08
-0.12
-0.33
-0.21
1.42
-0.07
-0.05
-0.06
-0.03
1.21
2016
Emission
Intensity
Achieved
production
changes
Achieved
electricity
Achieved
raw
material
FY2024
Emission
Intensity
Taget
coke
related
Target
electricity
Target
fuels incl
CCS
Target
raw
materials
Target
year
2030
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
1.80
2.00
2.20
Annual review
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Review by the Board of Directors
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Social information
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Outokumpu’s climate target is a combined emission intensity target, including Scope 1,
Scope 2 and Scope 3. The company has not disclosed specific targets for each scope. The
target differs from total reported GHG emission as it is set based on CO2 emissions only,
since other emissions were considered insignificant in the steel production process. The
target is based on market-based Scope 2. The target boundary differs also from gross
greenhouse gas emissions as it addresses the steelmaking process (excluding sold
ferrochrome) and does not include downstream processing and distribution. The baseline
emission intensity in 2016 for Scope 1 emissions was 0.45 tCO2/tonne of crude steel,
Scope 2 was 0.45 tCO2/tonne of crude steel and Scope 3 was 1.18 tCO2/tonne of crude
steel.
In 2024 the emission intensity was 0.4 tCO2/tonne of crude steel in Scope 1, 0.1 tCO2/
tonne of crude steel in Scope 2 and 0.9 tCO2/tonne of crude steel in Scope 3.
Outokumpu’s target is set for the emission intensity and the company currently does not
have absolute science-based emission targets.
As explained above, the emission intensity target differs slightly from the gross greenhouse
gas reporting. Compared to the gross greenhouse gas emissions, the science-based target
covers 99.9 % of the emissions in Scope 1, 78.7 % in Scope 2 and 84.5 % in Scope 3.
(E1-4-34-(b))
Outokumpu’s CO2 emission intensity progress, tonnes of CO2 per tonne of steel
2.1
2.0
1.9
1.8
1.7
1.8
1.7
1.5
1.4
1.2
Direct
Indirect
Upstream CO2 emission intensity
All scopes
Total emission target line
16*
17*
18*
19*
20*
21
22
23
24
25
26
27
28
29
30
0.0
0.5
1.0
1.5
2.0
2.5
3.0
The restructuring resulted in a recalculation of the baseline and in 2% higher emission intensity figures.
* Including discontinued operations
Ensuring baseline value representativeness
As reported earlier, the current baseline for the emission intensity reduction target is set as
an average of three consecutive years, which are 2014, 2015 and 2016. Based on this,
the baseline emission intensity value is 2.1 tCO2/tonne of crude steel. (E1-4-AR-25-(a-b))
Target’s compatibility with global warming limit of 1.5°C
The climate target is science-based and is compatible with limiting global warming to
1.5°C, and it has been approved and published by the Science Based Targets initiative in
2021. (E1-4-34-(e)), (E1-4-16-(a))
Decarbonization levers and their contributions to the emissions
reduction target
Currently expected emissions reductions by source of emissions until the target year 2030
from the baseline in 2016 is outlined in the graph earlier in the report. They address all
three scopes: fuel and coke-related activities impact Scope 1, electricity impacts Scope 2,
and raw materials impact Scope 3. In 2016, the company’s emission intensity was 2.1
tCO2/tCS and by 2030, the company aims to reduce its emission intensity to 1.2 tCO2/tCS.
In this timeframe, Outokumpu aims to reduce the emission intensity by 0.06 tCO2/tCS
from coke related emissions by switching to biocoke and 0.45 tCO2/tCS by increasing low-
carbon energy use globally as well as by replacing fossil fuels with renewable alternatives.
By integrating with to the supply chain, Outokumpu aims to reduce its raw material
emission intensity by 0.24 tCO2/tCS. The company also sees that in the long-term, beyond
the 2030 target carbon capture will be key in reducing emissions that are hard to abate.
(E1-4-34-(f), (E1-4-16-(b))
Use of scenario analysis in metrics and targets
Outokumpu has performed a policy scenario and sustainable development scenario
analysis in line with the International Energy Agency Iron and Steel Technology Roadmap
(2020). The company’s scenario analysis is according to a scenario well below 2°C and the
1.5°C ambition of the Science-Based Targets initiative. Available scenarios take into
account countries’ energy and climate-related policy commitments, and they provide a
baseline scenario against which Outokumpu assesses the additional policy actions and
measures needed to achieve the sustainable development scenario (SDS). The trajectory
for emissions in the sustainable development scenario of the IEA is consistent with
reaching global “net-zero” greenhouse gas emissions for the energy system as a whole by
around 2070. (Source: International Energy Agency or IEA Iron and Steel Technology
Roadmap, 2020.) Existing scenarios do not take into account the special features of
stainless steel production. Stainless steel is produced mainly from scrap but requires the
input of ferroalloys to achieve the right composition. To translate the steel industry
scenarios to stainless steel production, it is assumed that the emission intensity of the
steel sector is the same as the intensity of stainless steel production, including Scope 3
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emissions. The target year for the scenarios is set to 2050 in line with the company’s
carbon neutrality target. (E1-4-AR-30-(c))
Energy consumption and mix
Tracking performance and effectiveness
Outokumpu monitors energy consumption both related to total energy used and as a key
performance indicator (KPI) tailored to stainless steel process. The latter is an intensity KPI
that covers all Outokumpu’s production processes from ferrochrome production) to melting,
hot-rolling and cold-rolling processes. The KPI is expressed as MWh/produced steel and it is
followed up on monthly basis. (E1-5-MDR-M-75))
Methodologies and assumptions
Energy efficiency is defined as the sum of specific fuel and electricity energy of all
processes calculated as energy consumption against the product output of those
processes. Used heat values and the consumption of energy are based on documentation
from suppliers. (E1-5-MDR-M-77-(a))
Energy use is part of the verification process by which the sites subject to the EU emissions
trading scheme report their emissions and energy use to local authorities. Outokumpu’s
production units included in the emissions trading scheme are Tornio, Finland; Avesta, Nyby
and Degerfors, Sweden; and Krefeld and Dillenburg; Germany. (E1-5-MDR-M-77-(b))
Total energy consumption
MWh or %
2024
(1) Fuel consumption from coal and coal products (MWh)
0
(2) Fuel consumption from crude oil and petroleum products (MWh)
92,143
(3) Fuel consumption from natural gas (MWh)
1,689,701
(4) Fuel consumption from other fossil sources (MWh)
975,166
(5) Consumption of purchased or acquired electricity, heat, steam, and cooling from
fossil sources (MWh)
714,565
(6) Total fossil energy consumption (MWh)
(calculated as the sum of lines 1 to 5)
3,471,574
Share of fossil sources
in total energy consumption (%)
50.7 %
(7) Consumption from nuclear sources (MWh)
2,714,398
Share of consumption from nuclear sources
in total energy consumption (%)
39.6 %
(8) Fuel consumption for renewable sources, including biomass (also comprising
industrial and municipal waste of biologic origin, biogas, renewable hydrogen, etc.)
(MWh)
30,044
(9) Consumption of purchased or acquired electricity, heat, steam, and cooling from
renewable sources (MWh)
632,120
(10) The consumption of self-generated non-fuel renewable energy (MWh)
(11) Total renewable energy consumption (MWh)
(calculated as the sum of lines 8 to 10)
662,164
Share of renewable sources in total energy consumption (%)
9.7 %
Total energy consumption (MWh)
(calculated as the sum of lines 6, 7 and 11)
6,848,136
(E1-5-37, 37-(a-b), (c)-(i-(ii)), (E1-5-38-(a-e), (E1-5-39), (E1-5-AR 34)
In 2024, the share of low-carbon electricity was 90% in Outokumpu’s operations through
power purchase agreements and certificates. Energy intensity was 10.9 GJ/produced tonne
of stainless steel.
Energy intensity
MWh/monetary unit
2024
Total energy consumption from activities in high climate impact
sectors per net revenue from activities in high climate impact sectors
(MWh/Monetary unit)
0.0012
(E1-5-40)
Energy intensity per net revenue associated with activities in high climate impact sectors
was 0.12% megawatt hours per EUR million.
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High climate impact sectors
As Outokumpu produces stainless steel and ferrochrome, which are energy-intensive
processes, the company’s entire operations are defined as a high climate impact sector
according to the EU regulation. The company’s operations are covered by NACE code 24.1,
which matches economic activity 3.9 of Annex I to the Climate Delegated Act: manufacture
of iron and steel. (E1-5-42)
Financial reconciliation
Outokumpu’s net revenue is EUR 5,942 million in note 2.2 in the Financial Statements.
According to the EU regulation, Outokumpu’s entire operations are defined as a high
climate impact sector. (E1-5-43)
Net revenue
€ million
2024
Net revenue from activities in high climate impact sectors used to calculate
energy intensity
5,942
Net revenue (other)
—
Total net revenue (Financial Statements)
5,942
(E1-5-AR-38-(b))
Gross Scopes 1, 2, 3 and
total greenhouse gas emissions
Tracking performance and effectiveness
Outokumpu’s key performance indicator in following its emissions is intensity-based
greenhouse gas emissions (GHG) per tonne of crude steel. This metric includes all three
scopes, and it is Outokumpu’s target in the Science Based Targets initiative.
(E1-6-MDR-M-75-(a))
Methodologies and assumptions
The greenhouse gas measuring and reporting follows the GHG Protocol Corporate Standard
and steel industry standards. CO2 emissions of electricity are calculated and monitored by
the emissions factor of Outokumpu’s electricity mix of 73 kg CO2/MWh, given by the
electricity supplier for the used electricity and calculated as a weighted average. CO2
emissions outside the company (Scope 3) are included. The main impact comes from
purchased goods, mainly alloys. Emissions from business travel and waste generated are
also reported, at least partly, as well as downstream transportation of products.
(E1-6 MDR-M-77-(a))
External validation
Outokumpu’s sites that are subject to EU Emissions Trading have to verify their CO2
emissions annually; energy use is part of this verification process. The sites are Tornio,
Avesta, Nyby, Degerfors, Krefeld, and Dillenburg. Emissions are verified by accredited
verification bodies for the EU ETS scheme. The verifier depends on the country in which
the site is operating. (E1-6 MDR-M 77-(b))
Total greenhouse gas emissions
Scope 1 emissions are 990,643 tCO2eq (27%), Scope 2 emissions are 364,704 tCO2eq
(10%) and Scope 3 emissions are 2,347,109 tCO2eq (63%) of Outokumpu’s total emissions
in 2024. In total, Outokumpu’s greenhouse gas emissions were 3,702,456 tCO2eq.
(E1-6-44-(a-d)
Outokumpu has no associate or joint ventures that Outokumpu has control over and needs
to report, however, if an associate is part of the value chain, the related value chain
emissions are accounted for. Therefore, the gross emissions reported are the emissions for
the consolidated group. (E1-6 50)
Disaggregation of greenhouse gas emissions
To provide information for ResponsibleSteel certification, Outokumpu also reports
greenhouse gas emissions for the Europe business area separated by business line, as
shown in the table below.
Business line
Scope 1, tCO2eq
Scope 2, tCO2eq
Scope 3, tCO2eq
Advanced Material
187,521
11,510
688,997
Stainless Europe
448,272
64,662
1,061,874
(E1-6-AR-41)
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Auditor's Report and Assurance Report
Governance and remuneration
Greenhouse gas emissions and targets
Retrospective
Milestones and target years
Base year2)
Comparative
N
%N/N-1
2016
2023
2024
Change, %
20303)
Annual % Target /
base year
Scope 1 GHG Emissions
Gross Scope 1 GHG emissions (tCO2eq)1)
1,213,634
n/a
990,643
n/a
689,400
3 %
Percentage of Scope 1 GHG emissions from regulated emissions trading schemes (%)
84 %
Scope 2 GHG Emissions
Gross location-based Scope 2 GHG emissions (tCO2eq)
n/a
n/a
540,274
n/a
n/a
n/a
Gross market-based Scope 2 GHG emissions (tCO2eq)
1,210,872
n/a
364,704
n/a
28,200
7 %
Significant scope 3 GHG emissions
Total gross indirect (Scope 3) GHG emissions (tCO2eq)
3,163,556
n/a
2,347,109
n/a
2,211,400
2 %
1 Purchased goods and services
n/a
n/a
1,843,340
n/a
n/a
n/a
3 Fuel and energy-related activities (not included in Scope1 or Scope 2)
n/a
n/a
111,493
n/a
n/a
n/a
4 Upstream transportation and distribution
n/a
n/a
n/a
n/a
n/a
5 Waste generated in operations
n/a
n/a
21,957
n/a
n/a
n/a
6 Business traveling
n/a
n/a
4,469
n/a
n/a
n/a
9 Downstream transportation
n/a
n/a
218,934
n/a
n/a
n/a
11 Use of sold products
n/a
n/a
146,917
n/a
n/a
n/a
Total GHG emissions
Total GHG emissions (location-based) (tCO2eq)
n/a
n/a
3,878,026
n/a
n/a
n/a
Total GHG emissions (market-based) (tCO2eq)
5,588,062
n/a
3,702,456
n/a
2,929,000
3 %
(E1-6 AR-48, E1-6-44 (a-d); 52-(b), E1-6-AR-46-(d), E1-6-48 (a-b), E1-6-49, 52 (a,a), E1-6-49, 52 (b,b), E1-6-51)
1) Tonnes of CO2 equivalent.
2) Base year emissions are only reported as CO2.
3) The company has set its science-based target only on emission intensity, however reported in the table as illustrative absolute emission target for 2030.
Methodologies and assumptions in calculating GHG emissions
Outokumpu’s measuring and reporting of greenhouse gas emissions follows the GHG
Protocol Corporate Standard and also utilizes steel industry standards such as ISO 14404.
Outokumpu production sites falling under the European emission trading system (EU ETS)
report the direct emissions according to the verified EU ETS requirements.
Scope 1 emissions were calculated based on fuel and material consumption, including the
following greenhouse gases: CO2, N2O, and CH4. The rest of the GHG were not relevant for
the fuels used. National emission factors from authorities were used for fuels, as these are
also used for ETS reporting. For materials, emissions were calculated based on carbon
content, in line with ETS methodology.
Greenhouse gas emissions of Scope 2 electricity are calculated and monitored by the
emissions factor of Outokumpu’s market-based electricity mix of 73 kg CO2eq/MWh, given
by the electricity supplier for the used electricity, and calculated as weighted average. This
includes 100% of electricity use in the EU market, which comes with guarantees of origin
and from ownership in power production. In addition, location-based electricity emissions are
disclosed. They are calculated by the published country-specific emissions factors of the
electricity generation of 2023. Electricity consumption in operations is calculated based on
measured consumption, electricity consumption of offices is based on full-time employees
multiplied by a factor for electricity use.
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Purchased heat Scope 2 emissions are calculated based on supplier-specific information
(E1-6 AR 39-(b))
Effects of significant events and changes in circumstances
Outokumpu has not identified any effects of significant events and changes in
circumstances (relevant to its GHG emissions) that occur between the reporting dates of
the entities in its value chain and the date of the undertaking’s general purpose Financial
Statements. (E1-6 AR-42-(c))
Scope 1
Biogenic emissions
Outokumpu is also using biomaterials in production. The biogenic emissions from biofuels
and biocoke amounted to 8,256 tCO2 in 2024. (E1-6-AR 43-(c))
Scope 2
Contractual instruments
Outokumpu reports both location-based and market-based GHG emissions. The science-
based target is calculated and reported using market-based Scope 2 emissions. During the
reporting year, Outokumpu bought guarantees of origin from energy producers covering 85%
of its electricity need. Outokumpu has access to certificates through ownership, power
purchase agreements (PPA) and electricity suppliers. The market-based emissions do not
include other GHG than CO2. (E1-6 AR 45-(d))
Biogenic emissions
Outokumpu uses electricity emission factors from suppliers or country-specific emissions
factors that do not separate the percentage of biomass or biogenic CO2 . Referring to
transitional provision related to value chain, Outokumpu is not reporting on Scope 2
biogenic emissions in this report. Outokumpu is assessing how to retrieve this information
in future disclosures, for example by directly engaging with suppliers. (E1-6-AR 45-(e))
Scope 3
Primary data
The percentage of GHG Scope 3 calculated using primary data is 66%. (E1-6-AR-46-(g))
Category
Scope 3 emissions are reported from the following categories: purchased goods and
services (3.1), fuel and energy related activities (not included in Scope 1 or Scope 2) (3.3)
waste generated in operations (3.5), business travel (3.6.), downstream transportation and
distribution (3.9) and use of sold products (3.11). Categories that are not reported include
leased assets (3.8, 3.13) and franchises (3.14) as not applicable. The processing and use
of sold steel (3.10 and 3.11) are not included for the material steel due to the wide and
dispersed use of the material. However, the use of the sold waste gas is included under
3.11 The end-of-life treatment(3.12) is not disclosed in the table, but it is included in the
purchased goods as the upstream emissions of collecting, sorting and treating secondary
steel is included. For capital goods and investments (3.2 and 3.15), for employee
commuting (3.7) and upstream transport (3.4) Outokumpu is not reporting on these
emissions since they have been assessed as not material for Outokumpu. (E1-6 AR 46-(i))
Biogenic emissions
Outokumpu uses both specific data and data base emission factors to calculate value
chain emissions; no biogenic emissions have been reported for the value chain.
(E1-6-AR-46-(j))
Reporting boundaries and methods
The reporting boundary for Scope 3 data covers all Outokumpu production processes, from
mining to cold rolled steel products. The main Scope 3 impact comes from purchased
goods, mainly alloys. Emissions from business travel and waste generated are also
reported, and sold products to the extent feasible,as well as downstream transportation of
products. Outokumpu follows a tiered approach for Scope 3 emission factors for both
carbon footprint calculations and greenhouse gas reporting. Outokumpu uses specific
emission factors when available, secondly industry-average collected data, and thirdly data
from databases or standards, such as ISO 14404 or the Ecoinvent database.
•
Category 1 (purchased goods and services): Outokumpu calculates annual weighted
average emission factors for its raw materials. For each material raw material supplier
Outokumpu requests first-hand specific data. Where specific emission factors are
missing, Outokumpu uses emissions factors of the life-cycle assessments of relevant
industry associations such as the Nickel Institute and International Molybdenum
Association when available. In case neither specific supplier data nor industry average
data is available, data from ISO 14404 or Ecoinvent is used. Emissions of externally
sold ferrochrome are not allocated to the science-based target as that relates to
stainless steel production, but they are included in the Gross greenhouse gas reporting
of the company. Emissions related to other purchased goods are also calculated based
on supplier-specific emission factors when available, which is the case for lime and
dolomite.
•
For consumables like electrodes and coke, emission factors from ISO 14404 are used.
•
Category 3 (fuel and energy-related activities not included in Scopes 1 and 2): Upstream
emissions of fuels are calculated using relevant emission factors from literature like the
Well-to-Tank report from JRC. In some cases also emission factors from the steel
industry association are used.
•
Category 5 (waste generated in operations): Outokumpu uses specific data from waste
treatment facilities
•
Category 6 (business travel): Outokumpu uses for cars, trains and flights the emission
reports from the service provider. The reports contain information on travelled distances
and related CO2 emissions, calculated using emission factors from relevant databases.
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•
Category 9 (downstream transportation): Outokumpu calculates the emissions for intra-
company transport and deliveries based on mode of transport and typical distances.
Emission factors used are according to according to EEA report 2/2022 of the European
Environmental Agency for European transport, and with the published e-factors of US
EPA for US transport.
•
Category 11 (use of sold products): since there is a large range of uses and it is not
feasible to calculate emissions for use for steel. Outokumpu also sells waste gas from
ferrochrome production, and that use is included in the calculations. The emissions are
calculated based on the carbon content of the waste gas. (E1-6 AR 46-(h)
Greenhouse gas emission intensity
Outokumpu reports actual greenhouse gas emissions in the table below. However, as the
2030 target is intensity-based, we cannot disclose absolute numbers for the target year.
Greenhouse gas emission intensity
GHG intensity per net revenue
2024
Total GHG emissions (location-based) per net revenue (tCO2eq/Monetary unit)
0.0007
Total GHG emissions (market-based) per net revenue (tCO2eq/Monetary unit)
0.0006
(E1-6-53, AR-54)
Quantitative reconciliation and GHG intensity per net revenue
Outokumpu’s total amount of net revenue in the reporting year, as used to calculate the
greenhouse gas emission intensity, was EUR 5,942 million. More information can be found
in Note 2.2 in the Financial Statements. (E1-6-55, AR 55)
Net revenue
Net revenue, € million
2024
Net revenue used to calculate GHG intensity
5,942
Net revenue (other)
—
Total net revenue (in Financial Statements)
5,942
(E1-6-AR-55)
Internal carbon pricing
Internal carbon pricing is used in the evaluation of projects as a basis for investment
decisions, and it is applied to greenhouse gas emissions of all scopes. (E1-8-MDR-M-75)
Outokumpu uses the Bloomberg NEF case as a basis for the internal carbon price, which is
100 EUR/tCO2. (E1-8-MDR-M-77-(a)) There is no external verification for the internal carbon
price. (E1-8-MDR-M-77-(b))
Outokumpu has already in previous years, integrated a price for carbon dioxide into the
business case calculations for decisions on capital expenditure, as well as research and
development. (E1-8-63-(a)) The carbon price is part of Outokumpu’s guidelines on capital
expenditure. In particular, it is applied to the Group-wide energy efficiency program when
allocating the annual budget to the projects submitted by each facility. Additionally, R&D
projects work with the shadow price for real, worst, and best case scenarios. (E1-8-63-(b))
The carbon price is reviewed annually, and it is based on the EU emissions trading
scheme’s price development assumptions of Bloomberg NEF and management judgement.
Outokumpu uses a fixed carbon price over time to reduce fluctuations caused by uncertain
price variations. (E1-8-63-(c)) For the reporting year, the pricing scheme is used for
investment decisions and thus not covering the actual emissions during 2024. The shadow
price cannot be related directly to actual emissions since it is applied to investments.
(E1-8-63-(d))
Outokumpu’s internal carbon pricing is not used for fixed asset assessment. The Financial
Statements include the allowances of the EU emissions trading scheme which are
assessed according to the company’s financial accounting principles and differ from the
internal shadow price. Internal carbon pricing is not reflected in the Financial Statements.
(E1-8-AR-65)
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E2 – Pollution
Pollution – including air, water and soil pollution – and hazardous substances were
identified as material for Outokumpu in its double materiality assessment.
Material impacts, risks and opportunities resulting from
the materiality assessment
E 2.1 Air, water and soil pollution
Impacts
Negative
Outokumpu’s own production processes generate emissions to air and water as well
as waste with a potential negative impact unless managed properly. There is also a
potential negative impact in the upstream value chain from the alloying metals that
are mined in regions that do not have as stringent environmental legislation as the
EU. These are actual negative impacts valid in direct operations and in the upstream
value chain.
E 2.2 Hazardous substances
Impacts
Positive
Stainless steel is inherently inert and does not exhibit toxic properties. Outokumpu’s
stainless steel contributes to good hygiene and is widely used in downstream
applications such as food manufacturing and health care applications. This is an
actual positive impact valid in the downstream value chain.
Negative
Outokumpu’s production processes generate waste that contains hazardous
substances with a potential negative impact on Outokumpu’s operations if not
managed properly. This is a potential negative impact valid in direct operations.
Risks and
opportunities
Risk
Improper handling of waste could result in remediation. While the stainless steel does
not exhibit toxic properties, it contains substances that on their own could be
hazardous, This could have a negative effect on the perception of stainless steel and
its applications, thus posing a financial risk. This risk is valid in direct operations.
(ESRS 2-SMB 3-48-(a))
Outokumpu Annual Report 2024
87
Humanity is facing environmental issues with
climate, nature – and pollution. As stainless
steel production may have impacts on nature,
Outokumpu prevents, controls and mitigates
pollution to protect people and the
environment.
KEY ACTIONS in 2024
Investigations to improve
wastewater treatment in
Tornio, Finland.
Training of employees in
awareness and pollution
control in Kemi, Finland and
San Luis Potosí, Mexico.
PLAN 2025–2029
Continuous monitoring of
performance in water
discharges and air
emissions.
Implementing best available
techniques in all operations
to reduce the emission of
pollutants.
Minimizing the use of
substances of concern
whenever viable.
Apply precautionary risk-
based environmental
management to prevent
incidents.
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Impact, risk and opportunity
management
Policies
Policies related to pollution
Key contents of policy
Management of pollution is part of Outokumpu’s Sustainability Policy. As mentioned in the
policy, Outokumpu is committed to minimizing the negative impact of its operations on the
surrounding environment and communities by proactively developing its production
processes and its energy and material efficiency. Continuous monitoring of performance on
water consumption and discharges, input material and recycling, waste and environmental
incidences are followed by immediate action if needed.
To mitigate environmental impacts, Outokumpu implements precautionary risk-based
environmental management to prevent incidents and reduce emissions to air and
discharges to water, and aims to minimize the use of substances of concern.
(E2-MDR-P-65-(a))
Scope, accountability, stakeholders, availability,
and third-party standards
More information about Outokumpu’s Sustainability Policy and its scope, the approval
process for the policy, and disclosure of third-party standards, consideration given to key
stakeholders, and the availability of the policy, can be found in the Climate change (E1)
chapter, in the Policies section (E1-2). (E2-MDR-P-65-(b-f))
Addressing material areas in policy
Mitigating negative impacts
According to its Sustainability Policy, Outokumpu reduces its impact on the environment by
reducing pollution and emissions to air and water. Outokumpu also aims to minimize the
use of substances of concern and phase out the use of substances of very high concern
whenever viable. Outokumpu aims to minimize all negative impacts of its present and
discontinued operations on the environment and local communities, including related
health impacts, and aims to remediate any material negative impacts that have occurred,
where viable. This is achieved by continuous monitoring of performance on energy,
greenhouse gas emissions, and water and related emissions. The measures cover regulated
pollutants and pollutants that have been identified as relevant for Outokumpu’s activities in
impact assessments. For more details on which pollutants, please see the table “Emissions
to air and water” below in this chapter. (E2-1-15-(a)), (E2-1, AR 11)
Substituting and minimizing use of substances of concern
Outokumpu aims to minimize the use of substances of concern and phase out the use of
substances of very high concern whenever viable, both in its own operations through
evaluation and assessment of chemicals that are used, and in the upstream supply chain
by requiring suppliers to comply with REACH restrictions on hazardous substances when
supplying materials. (E2-1-15-(b)), (E2-1, AR-11)
Avoiding incidents and emergency situations
According to policy Outokumpu strives to prevent incidents by implements precautionary
risk-based environmental management. Any environmental incidences that occur are
followed by immediate action if needed in order to reduce the environmental impact In the
event of unforeseen water or soil contamination, Outokumpu seeks to remediate, whenever
viable, negative impacts and restore the environment as close to the state prior to the
event. (E2-1-15-(c))
Actions and resources
Actions and resources related to pollution
Key actions
Key actions in 2024 included:
•
In Kemi, Outokumpu continued the survey of cost-effective emission reduction methods,
as well as improvement actions for water balance management.
•
Employees were trained about emissions to air and dust emissions: how to detect, react
to and prevent them, and in Mexico, employees were trained on emission-generating
equipment. Proper training and knowledge about equipment reduces the risk of incidents
and release of pollutants.
•
In Tornio, the work continued on investment projects and planning due to new
environmental permit limits, as well as more efficient air purification systems, in order to
reduce pollutants in the long-term.
•
In Tornio, the hot-rolling mill worked on a project to reduce oil consumption, and the
cold-rolling mill on projects to reduce metals in process wastewater and to improve the
use of material in the neutralization process.
Outokumpu’s ongoing and future actions are:
•
continuous monitoring of performance in water discharges and air emissions,
•
implementing best available techniques (BAT) or equivalent standards in all operations,
to reduce the emission of pollutants,
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Governance and remuneration
•
preventing and reducing impacts by implementing precautionary risk based
environmental management to prevent incidents and reduce emissions to air and
discharges to water,
•
following up on environmental incidents by immediate action if needed to prevent
negative impact on the environment,
•
engaging stakeholders: where relevant, each site engages with local stakeholders,
including other businesses, government departments, and local communities, and
•
aiming to minimize the use of substances of concern and phase out the use of
substances of very high concern whenever viable.
The pollution action plan supports the policy objectives and contributes to the company’s
sustainability goals. In addition, the action plans contribute to achieving policy objectives
related to stakeholders, such as fostering continuous engagement, ensuring transparent
communication on sustainability performance, and meeting the expectations and
requirements of shareholders, employees, customers, suppliers, investors, and authorities,
as well as the public and non-governmental organizations. (E2-MDR-A-68-(a))
Outokumpu continuously measures relevant pollutants and takes action when needed, for
example if emissions exceed target values. In such a case, the company takes immediate
action to prevent damage to the environment. All Outokumpu’s production sites have limit
values for emissions that are set together with relevant authorities, based on the legislation
and environmental impact assessment.
Actions related to substances of concern are managed at each production site where the
new chemicals are assessed before use and decisions on substitution take place after
assessment. (E2-2-18)
Closed mines
Before focusing on production of stainless steel, Outokumpu operated several mines across
Finland and elsewhere. Outokumpu still operates the only chromium mine within European
Union, in Kemi. Closed mines were not assessed to be part of Outokumpu's current value
chain, neither further analyzed as part of the double materiality assessment. However, the
company puts significant efforts in assessing and taking after care measures at the old
mines annually.
In some of the closed mines, Outokumpu still has an environmental permit or other
environmental and safety responsibilities and obligations, and the company continues to
work accordingly. For example, Outokumpu regularly carries out studies and analyses, does
onsite visits, environmental monitoring and maintenance, as well as cooperates with
competent authorities and local stakeholders. The activities are evaluated based on these
on-site visits, studies and analyses and risk-assessment of each closed mine.
In 2024 the company continued to monitor the safety and the environmental situation, and
executing maintenance work at the closed mines. Comprehensive environmental studies
were done at Enonkoski and Vihanti in Finland, and smaller studies at several other sites.
The work will continue ensuring safety, monitoring of environmental impacts, execution of
complementary restoration measures and engagement with the local stakeholders.
Scope and time horizon
Outokumpu’s actions related to pollution focus on its own operations, in all business areas.
(E2-MDR-A-68-(b))
The time horizon for the actions is from short to medium term, with short-term actions
including monitoring of emissions, training of employees in Mexico, and taking actions on
incidents. Medium-term actions are implementing risk-based environmental management to
prevent incidents and reduce emissions, planning for the new environmental permit in
Tornio, and minimizing substances of concern. (E2-MDR-A-68-(c))
Remedies and provisions
Outokumpu has not had any environmental incidents that would have caused material
harm. In the reporting year, there were 8 environmental permit breaches at operational
sites, of which 2 were related to water emissions. In total, there were 15 environmental
incidents. In all of these, Outokumpu reported the incident to the environmental
authorities, carried out corrective actions immediately, or resolved the incidents together
with the authorities. No environmental damage was detected, nor was there any need for
provision or remedy. (E2-MDR-A-68-(d))
Mitigation hierarchy
To avoid and reduce pollution, Outokumpu follows local permit levels as the key driver for
reducing impact, as many of Outokumpu’s sites are subject to the Industrial Emission
Directive and Best Available Techniques (BAT) criteria. (E2-2-19)
Action related to pollution extends to upstream/downstream
value chain engagements
Outokumpu has identified positive impacts from its products with regard to pollution in the
downstream value chain. Outokumpu’s technical experts work together with selected
customers to design end-products that contribute to these positive impacts. (E2-2-AR-13)
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Metrics and targets
Targets related to pollution
Outokumpu has not yet set specific pollution targets, since Outokumpu has been ensuring
progress on pollution through actions and policies. (E2-MDR-T-81-(a)) However, Outokumpu’s
production sites are monitoring and tracking emissions of relevant pollutants. The sites
have also implemented techniques to treat both water and air emissions before release
into the environment. (ES E2-MDR-T-81-(b)) The range of pollutants that are monitored
depends on the size and activities of the production sites. However, all sites are monitoring
particulate matter and nitrogen oxides into air. Water emissions are monitored mainly for
nitrates and suspended solids, but also for metals such as nickel and chromium. The
results are analyzed and followed up over time to ensure that emissions do not exceed
environmental permit or target limits, as well as to identify trends. (E2-MDR-T-81-(b)-(i)) The
company has committed to reducing the environmental impact and keeping the limits
defined in the environmental permits and not to increase the impact on the surrounding
environment. (E2-MDR-T-81-(b)-(ii))
Pollution of air, water and soil
Outokumpu monitors its emissions into air and water. The pollutants that sites monitor and
report on depend on their activities, size and permit conditions.
Outokumpu’s most significant material emissions into air include particulate matter,
nitrogen oxides and sulfur oxides. While, in general, steel production generates a lot of
particulate matter, Outokumpu’s dust filtering system effectively removes 99% of the
particulate matter. The level of particulate matter from the melt shops is within the limits
of environmental permits and in line with the levels of best available techniques.
The main discharges into water are metals and nitrates, which are continuously monitored.
Outokumpu follows up on incidents when target values for emissions are exceeded, even if
it does not amount to a permit breach. All wastewater is treated in Outokumpu’s own
treatment plants or in municipal water treatment systems before it is discharged.
Emissions to soil are not monitored regularly as soil pollution is mainly in the form of
environmental incidents like for example oil spills. No material incidents to soil was
reported for 2024. (E2-4-MDR-M-75)
Changes over time
Due to changes in reporting scope, more pollutants in scope of reporting, it is difficult to
compare for example metal discharge with previous years information. Emissions into air
have varied from year to year, partly based on production volumes, and in 2024 emissions
of particulate matter were 125,860 kg, nitrogen oxides emissions 1,626,233 kg, and sulfur
oxides emissions 214,632 kg. It means that nitrogen oxide emissions have increased
slightly in 2024 while emissions of sulfur oxide and particulate matter have decreased.
More information is available in the table on emissions on next page. (E2-4-30-(a))
Data collection, methodologies and assumptions
Outokumpu performs measurements and analyses of pollutants in accordance with the
monitoring program specified in each environmental permit. Usually the measurements are
carried out by a third party except where Outokumpu has its own laboratory that is
accredited for the specific analysis. Outokumpu’s measurements are mainly direct
measurements. Measurements are in many cases continuous, which is the case with dust
and nitrogen oxides, or periodic, as with metals into air. The measurements are done in
accordance with recognized standards, such as EN 14792 for NOx and EN 13284 for
particles to air, and ISO 11885 or ISO 15587 for metals and minerals to water. For Nitrate-
N to water ISO 13395 is used. (E2-4-30-(b)) While emissions are mainly measured directly, in
some cases calculations also are applied; for example, NOx is calculated based on NO2
measurements. (E2-4-MDR-M-77-(a))
Outokumpu’s production processes are all subject to environmental permits that dictate
how the emissions should be measured and what the frequency is for reporting. The
emissions are either monitored in-house, which is the case for some water emissions, as
well as particles and nitrogen oxides into air. Emissions can also be monitored by external
companies, who provide reports to Outokumpu, which is the case for example for metals
into air. Each production facility is responsible for monitoring and reporting their emissions.
The emission data is reported both to relevant authorities and to Outokumpu Group. Data
on pollutants listed in Annex II of Regulation (EC) No 166/2006 (European Pollutant
Release and Transfer Register “E-PRTR Regulation”) are monitored and reported for each
production facility in accordance with the Directive, taking into account relevant thresholds.
This data is then consolidated and reported in the emissions table. (E2-4-30-((c)) There is no
other external validation for the measurements. (E2-4-MDR-M-77-(b))
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Emissions into air and water 2024
Pollutant type
Emission into air
(kg)
Emission into
water (kg)
Emission into
soil (kg)
Ammonia (NH3)
61,168
5,369
—
Anthracene
—
—
—
Arsenic and compounds (as As)
35
9
—
Asbestos
—
—
—
Benzene
—
—
—
Cadmium and compounds (as Cd)
—
116
—
Chlorides (as total Cl)
—
—
—
Chromium and compounds (as Cr)
2,665
1,369
—
Copper and compounds (as Cu)
162
67
—
Cyanides (as total CN)
—
149
—
Fluorides (as total F)
—
23,555
—
Fluorine and inorganic compounds (as HF)
—
—
—
Hexachlorobenzene (HCB)
—
—
—
Hydrogen cyanide (HCN)
426
—
—
Lead and compounds (as Pb)
206
71
—
Mercury and compounds (as Hg)
54
33
—
Naphthalene
—
—
—
Nickel and compounds (as Ni)
763
1,096
—
Nitrogen oxides (NOx/NO2)
1,626,233
—
—
Non-methane volatile organic compounds
(NMVOC)
—
—
—
Particulate matter (PM10)
125,860
—
—
PCDD + PCDF (dioxins + furans) (as Teq)
—
—
—
Pentachlorobenzene
—
—
—
Polycyclic aromatic hydrocarbons (PAHs)
—
—
—
Sulfur oxides (SOx/SO2)
214,632
—
—
Total nitrogen
—
1,303,394
—
Total organic carbon (TOC) (as total C or COD/3)
36,480
—
—
Total phosphorus
—
—
—
Trichlorobenzenes (TCBs) (all isomers)
—
—
—
Zinc and compounds (as Zn)
1,983
1,940
—
(E2-4-28-(a))
Outokumpu does not have anything to report on soil for the reporting year within its value
chain. (E2-4-28-(a))
Justification for methodology choices
The choice of methodology is taken in discussion with local environmental authorities.
(E2-4-31)
Substances of concern and very high concern
Stainless steel, a widely used alloy, typically contains nickel, which is classified as a
substance of concern. Nevertheless, stainless steel itself is generally considered safe, for
example according to the Review on toxicity of stainless steel (2020 update) by the Finnish
Institute of Occupational Health.
REACH regulation considers stainless steel as an alloy and not a chemical substance. The
REACH regulation typically applies to the substances used in or released by stainless steel
and therefore, for example, nickel is subject to regulation, but stainless steel itself is
usually not classified as hazardous. Stainless steel’s safety, stability, and versatility
present numerous opportunities across a range of industries. Its non-reactive nature, and
resistance to corrosion, combined with increasing demands for sustainable and long-lasting
materials, make stainless steel a valuable choice in many sectors. (E2-5-MDR-M-75)
The methodologies used to regulate substances of concern and substances of very high
concern are based on the European Union’s REACH regulation. The chemicals included in
the substance of concern are classified under REACH and CLP (Classification, Labelling and
Packaging, EU Regulation 1272/2008) in specified hazard classes, and they are commonly
described as chemicals that may pose a risk and are often identified for potential future
regulation based on their toxicity, environmental persistence, or other properties of
concern. By “amount used/generated,” Outokumpu considers raw materials and other
consumables used in its production and, for the amount generated, emissions of
substances of concern and substances of very high concern are included. “As parts of
products and service,” stainless steel as a product is safe but nickel, which is a substance
of concern, exists in the product (alloy), leaving Outokumpu facilities as a part of stainless
steel products. The reporting threshold for REACH has been applied when reporting
substances of concern, while the lower concentration limit has been applied for substances
of very high concern. Outokumpu monitors inventories through chemical management
systems, but there can be uncertainties in the data for the reporting period, especially
regarding amounts used. The reporting will be improved for the next reporting years. These
substances are regulated based on restriction limits mentioned in REACH's Annex XVII list
of substances. (E2-5-MDR-M-77-(a)) No external body other than the assurance provider has
provided validation for these. (E2-5-MDR-M-77-(b))
The table below outlines substances of concern or very high concern used in the processes.
Since substances can have several hazard classifications, the same amounts can be
repeated in several hazard classes. The largest amount is due to the use of nickel in
stainless steel. It should be noted that while nickel is part of stainless steel, it is
embedded in a metallic matrix, which means that the properties of the steel are not the
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same as those of the constituent nickel. For example, the most common stainless steel
grade contains 7% nickel, and while nickel is classified as a skin sensitizer cat 1, this
stainless steel is not classified as a skin sensitizer. Similarly, the stainless steel does not
show any of the other hazards of nickel when tested against the classification criteria.
For substances of very high concern the major use is of disodiumtetraborate, which is used
to stabilize stainless slag so that it does not cause diffuse dusting and particle emissions
in the environment. The substance reacts with the slag and is not present in the slag
product.
Substances of concern 2024
Substance of concern, kg
Amount
generated/used
Leaving
Outokumpu as
emissions
Leaving
Outokumpu as
products
Leaving Outokumpu
as parts of products
and services
Carcinogenicity categories 1
and 2;
132,328,753
2,712
—
125,510,000
Germ cell mutagenicity
categories 1 and 2;
2,000
—
—
—
Reproductive toxicity categories
1 and 2;
4,101
—
—
—
Endocrine disruption for human
health;
—
—
—
—
Endocrine disruption for the
environment;
—
—
—
—
Persistent, mobile and toxic or
very persistent, very mobile
properties;
—
—
—
—
Persistent, bioaccumulative
and toxic or very persistent,
very bioaccumulative
properties;
—
—
—
—
Respiratory sensitization
category 1;
2,000
—
—
—
Skin sensitization category 1;
127,222,546
2,689
—
125,510,000
Chronic hazard to the aquatic
environment categories 1 to 4;
5,185,867
1,045
—
—
Hazardous to the ozone layer;
—
—
—
—
Specific target organ toxicity,
repeated exposure categories 1
and 2;
132,314,236
2,689
—
125,510,000
Specific target organ toxicity,
single exposure categories 1
and 2;
23,073
—
—
—
Total
397,082,576
9,136
—
376,530,000
(E2-5-34)
Substances of very high concern 2024
Substance of very high concern,
kg
Amount
generated/used
Leaving
Outokumpu as
emissions
Leaving
Outokumpu as
products
Leaving Outokumpu
as parts of products
and services
Carcinogenicity categories 1
and 2;
206,768
683
—
—
Germ cell mutagenicity
categories 1 and 2;
216
610
—
—
Reproductive toxicity categories
1 and 2;
374,475
610
—
—
Endocrine disruption for human
health;
—
—
—
—
Endocrine disruption for the
environment;
—
—
—
—
Persistent, mobile and toxic or
very persistent, very mobile
properties;
—
—
—
—
Persistent, bioaccumulative
and toxic or very persistent,
very bioaccumulative
properties;
—
—
—
—
Respiratory sensitization
category 1;
7
—
—
—
Skin sensitization category 1;
56
—
—
—
Chronic hazard to the aquatic
environment categories 1 to 4;
1,366
73
—
—
Hazardous to the ozone layer;
—
—
—
—
Specific target organ toxicity,
repeated exposure categories 1
and 2;
231
—
—
—
Specific target organ toxicity,
single exposure categories 1
and 2;
—
—
—
—
Total
583,118
1,976
—
—
(E2-5-35)
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E3 – Water resources
Water resources were identified as material for Outokumpu in its double materiality
assessment.
Material impacts, risks and opportunities resulting from
the materiality assessment
E 3.1 Water resources
Impacts
Negative
High water consumption for cooling and other operational activities can negatively
affect local areas and surrounding biodiversity systems, especially in water-stressed
regions. This is an actual negative impact valid in direct operations.
(ESRS 2-SMB 3-48-(a))
Impact, risk and opportunity
management
Policies
Policies related to water
Key contents of policy
Outokumpu’s Sustainability Policy includes sustainable sourcing of water, optimizing water
use, reducing environmental impacts, and ensuring compliance with regulations.
Regarding negative impacts, Outokumpu recognizes that high water consumption can have
detrimental effects on local areas and surrounding ecosystems, especially in water-stressed
regions. According to the Sustainability Policy, Outokumpu aims to mitigate this by
optimizing water use in production facilities (more information under “Product and service
design” section). The commitment to reduce water consumption in high water risk regions
is reflected in the company's Sustainability Policy as well (more information under “High-
water stress areas” section). Additionally, the Sustainability Policy addresses the negative
impact of high water consumption by water reuse (more information under “Water
management” section).
The process for monitoring water usage and discharges at Outokumpu involves continuous
performance tracking. Outokumpu's Sustainability Policy highlights the continuous
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93
People, nature and the economy all need water.
Outokumpu uses mainly surface water from
rivers and the sea, including rainwater.
The company measures the withdrawal of water,
recycles it as much as possible, and treats all
water before any discharges.
KEY ACTIONS in 2024
Prioritizing water efficiency,
recycling water and treating
wastewater.
Consistent and
comprehensive monitoring of
water use.
Engaging different
stakeholders for improved
knowledge on water
management.
PLAN 2025–2027
Assessment of the impact of
water use on the environment
and more systematic analysis
of water resources.
Development of improvement
plan for water management
on each site.
Annual review
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monitoring of water consumption and discharges, with immediate actions taken when
necessary. Through regular data collection and analysis from the production sites,
Outokumpu ensures ongoing improvement and effective management of its water
resources. (E3-MDR-P-65-(a))
Scope, accountability, stakeholders, availability,
and third-party standards
More information about Outokumpu’s Sustainability Policy and its scope, the approval
process for the policy, and disclosure of third-party standards, consideration given to key
stakeholders, and the availability of the policy, can be found in the Climate change (E1)
chapter, in Policies section (E1-2). (E3-MDR-P-65-(b-f))
Addressing material areas in policy
Water management
Outokumpu’s Sustainability Policy covers the following matters: use and sourcing of water
resources in its own operations, water treatment, prevention and abatement of water
pollution. In detail: (E3-1-12-(a))
•
Outokumpu considers sustainable sourcing of water in operations whenever
commercially viable. Since the topic of marine resources is not material for Outokumpu,
Outokumpu does not cover it in its Sustainability Policy. (E3-1-12-(a)-(i))
•
Outokumpu aims to reduce environmental impact through reusing water and wastewater
treatment, and it frequently assesses impact on water. (E3-1-12-(a)-(ii))
•
Outokumpu prevents and reduces its impacts by implementing precautionary risk-based
environmental management to prevent incidents and reduce waste, pollution and
emissions into air and discharges into water. Waste and production residues are dealt
with accordingly, and no related discharges into water bodies are allowed. In the event of
unforeseen water or soil contamination, Outokumpu seeks to remediate, whenever
viable, negative impacts and restore the environment to as close possible to the state
prior to the event. (E3-1-12-a-(iii))
Product and service design
According to Outokumpu’s Sustainability Policy:
•
Outokumpu optimizes material, energy, and water use to continuously improve
efficiency.
•
Outokumpu proactively develops its products and processes to help reduce impact on
the environment.
The preservation of marine resources is not covered by Outokumpu’s Sustainability Policy
since the topic of marine resources is not material for Outokumpu. (E3-1-12-(b))
High water stress areas
According to Outokumpu’s Sustainability Policy, Outokumpu is committed to reducing and
monitoring material water consumption in production plants in geographic areas
experiencing high water risk. The company operates a cold rolling mill in San Luis Potosí,
Mexico, in a dry, extremely high water stress area according to Aqueduct assessment. The
aforementioned policy covers only the company’s own operations. (E3-1-12-(c)), (E3-1-13)
Actions and resources
Actions and resources related to water
Key actions
Stainless steel operating sites
Key actions taken in the reporting year for all production sites:
•
Outokumpu has recycled and reused water, treated wastewater before releasing it into
the environment, and monitored water resources, and it continues to uphold these
practices to ensure sustainable water management.
•
Internal and external audits were conducted to help drive the company’s efforts to
improve its practices. The yearly ISO 14001 surveillance audits were conducted during
the reporting year at the sites and covered water-related matters. Additionally, internal
environmental audits were performed throughout the reporting year, addressing water-
related topics.
•
The company worked closely with different communities, organizations and authorities,
to improve its sustainable water use, while sharing data and resources with stakeholders
to enhance common water management efforts. This action taken is aligned with one of
Outokumpu’s Sustainability Policy main principles, which states that the company
"strives for a continuous, systematic, and open dialogue through engaging with our
stakeholders such as shareholders, employees, customers, suppliers, investors, and
authorities, as well as the public and non-governmental organizations."
Key actions planned for the future are based on the Water Stewardship plan developed by
Outokumpu. The Water Stewardship plan focuses on sustainable water management by
minimizing impacts on water resources, prioritizing water efficiency, regular assessments,
stakeholder engagement, and continuous improvement to manage and protect water
resources responsibly while minimizing environmental impacts. Key actions planned are:
•
Analyze water usage from each source on each site. The expected outcome would be a
better understanding of water usage from different sources, revealing opportunities for
reducing usage and improving water management practices.
•
Assess the impacts of water use on the environment at each site, to gain insight into the
impact caused by sites. The expected outcome would be enabling the implementation of
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proactive measures to be taken in the future to minimize environmental damage. The
implementation of the action contributes to the achievement of Outokumpu’s
Sustainability Policy, and the “frequently assesses impact on water” part in particular.
•
Develop continuous improvement plans for water management at each site. The
expected outcome would be improved water management and resource efficiency. The
implementation of the action contributes to the achievement of Outokumpu’s
Sustainability Policy, in which it is stated that Outokumpu proactively develops its
processes to help reduce impact on the environment.
Mine operations
Key actions taken in the reporting year:
•
Continuous measuring devices were installed at both groundwater level monitoring
points and fixed survey points, to monitor surface subsidence.
•
Regular weekly collection sampling of discharged water was started.
•
To improve dam safety monitoring and water balance calculations, continuous measuring
devices were installed at leachate water measurement points.
Key action planned for the future is based on Kemi mine’s water management plan. The
Kemi mine has a comprehensive water management plan based on water balance
calculations and long-term monitoring. The plan, systematically implemented and regularly
updated, addresses water entering the mining area, its treatment, and potential risks such
as water contamination.
Key actions planned:
•
Efforts are focused on preventing the drying out of surface layers and reducing the risk
of groundwater-level depletion. The plan is to develop a system for monitoring
groundwater levels and ground surface movements, involving continuous measurement
processes. The expected outcome is having a robust system for tracking groundwater
and surface conditions. The implementation of the action contributes to the
achievement of Outokumpu’s Sustainability Policy, and particularly the monitoring
aspect.
The Water Stewardship plan was developed in alignment with the guidance provided by the
Alliance for Water Stewardship standard. Kemi mine’s water management plan was
developed to meet the requirements of the Towards Sustainable Mining standard. The
Water Stewardship and Water Management plans support the water management policy
objectives. (E3-MDR-A-68-(a))
Scope and time horizon
The Water Stewardship plan and key actions include only the company’s own operations.
The future key actions from the Water Stewardship plan mentioned previously include only
Business Line Stainless Europe sites (Krefeld, Tornio), and Business Line Advanced
Materials sites (Avesta, Nyby, Degerfors, Dillenburg). The business area Americas including
the production sites in the US and Mexico currently do not have specific action plans on
water resources, but they measure water usage and are evaluating potential projects to
improve water management. Outokumpu plans to develop group-wide plans in the near
future. (E3-MDR-A-68-(b))
Each key action, namely analyzing water usage, assessing the impacts of water use on the
environment, developing improvement plans on water management, and developing a
system for monitoring groundwater levels, is planned to be completed within a medium-
term time horizon. The assessment of the impact of water use on the environment and the
development of the improvement plans on water management key actions are planned to
be fully completed by the end of 2027. (E3-MDR-A-68-(c))
Remedy
In 2024, Outokumpu did not have cases of harm by actual material impacts that would
require actions to provide remedy. (E3-MDR-A-68-(d))
Prior progress
In the Annual Report 2023 and the Sustainability Report 2023, published by Outokumpu, it
was stated that the company "started to define a water stewardship program.” The Water
Stewardship plan, which was finalized in March 2024, established water management
principles and outlined future actions for European sites. These actions are described in
the "Key actions" above. (E3-MDR-A-68-(e))
Actions and resources in areas of water risk
Currently, there are no specific actions established or resources allocated to reduce water
consumption, but Outokumpu plans to evaluate actions in the near future. In terms of
monitoring, Outokumpu has a monitoring action through the use of local key performance
indicators (KPIs) on water usage: well-water usage per packed tonne, treated water usage
per pickled tonne, and total water usage per packed tonne. Water usage is monitored daily.
(E3-2-19)
Metrics and targets
Targets related to water
Outokumpu has not yet set specific water targets, since Outokumpu has been ensuring
progress on water resources through actions, policies, monitoring, and key performance
indicators (KPIs). However, the company plans to assess potential water targets by the end
of 2025. (E3-MDR-T-81-(a))
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Outokumpu tracks the effectiveness of its policies and actions related to water resources
impacts, risks, and opportunities through several processes. (E3-MDR-T-81-(b)) Outokumpu's
Sustainability Policy emphasizes the importance of continuous monitoring of performance
on water resources, meaning that Outokumpu tracks the effectiveness of water resource
management through monitoring processes. The tracked metrics are outlined in more detail
in the section "Tracking performance and effectiveness". In addition to metrics and KPIs,
Outokumpu tracks the effectiveness of its policies and actions through other processes,
including regular audits and engagement with stakeholders. (E3-MDR-T-81-(b)-(i)) For water-
related matters, Outokumpu’s Sustainability Policy defines the ambition level and
expectations. For the San Luis Potosí site, KPIs are reviewed annually, and the level of
ambition is set for the upcoming year. The established KPIs are based on historical data.
The review process involves participation from various stakeholders, including people from
production, maintenance, and upper management. The volumes of water monitored are
based on direct measurements. The well water usage per packed tonne in 2024 was 1.04
m³, well below a reference-level set by San Luis Potosí site of 1.45 m³. For treated water
usage per pickled tonne, the site exceeded a reference-level set by San Luis Potosí site of
250 liters per tonne by using 330 liters per tonne. The total water usage per packed tonne
was 1.75 m³, below a reference-level of 1.85 m³ set by San Luis Potosí site.
(E3-MDR-T-81-(b)-(ii))
Targets related to areas of water risk and reduction
of water consumption
Outokumpu has not yet set specific water-related targets, including those for areas at water
risk. The KPIs mentioned earlier for the San Luis Potosí site are not currently linked to
specific long-term targets. However, as previously mentioned, the company plans to
evaluate potential targets by the end of 2025. (E3-3-23-(a),(c))
Water consumption
Tracking performance and effectiveness
Outokumpu tracks its performance and effectiveness related to material impacts, risks, and
opportunities through several key metrics: water withdrawal, water discharge, water
consumption, recycled and reused water, and total water stored. Water withdrawal per
source and water discharges per source are important metrics: tracking these metrics
demonstrates the company’s commitment to aligning operations with its policy objectives,
and these metrics are critical in assessing water consumption as well, which is identified as
a negative impact.
Water consumption is a critical metric for evaluating water resource management. On-site
consumption primarily occurs through processes such as evaporation, which is commonly
observed in cooling systems, along with various other processes. Additionally, water is
consumed through wet waste materials such as neutralization sludge. This water, unlike
that returned to water bodies, evaporates into the air as the waste dries. Since water
consumption is recognized as a negative environmental impact, tracking this metric is
essential for identifying opportunities to mitigate its effects.(E3-4-MDR-M-75)
Water consumption data for own operations
Volume (m³)
2024
(a) Total water consumption
6,289,440
(b) Consumption in areas at water risk
88,894
(c) Total water recycled and reused
13,070,955
(d) Total water stored
7,900
(d) Changes in water storage
—
(E3-4-28(a), (b), (c), (d))
Water withdrawal and discharges
Volume (m³)
2024
Surface water
24,294,029
Seawater
13,735,214
Municipal water
923,235
Groundwater
2,713,863
Rainwater
2,315,454
Water withdrawal by source
43,981,794
Water discharges
37,692,355
Wastewater to municipal treatment
1,086,228
Discharge to surface water
30,173,613
Discharge to sea water
6,412,481
Discharge to groundwater
20,033
Contextual information regarding water resources
Total water consumption
The provided data on water withdrawal and water discharges has been compiled following
recognized environmental management and sustainability standards. All Outokumpu sites
are ISO 14001 certified, which provides guidelines for monitoring and measuring
environmental performance, including water usage. Additionally, Outokumpu follows the GRI
303: Water and Effluents 2018 standard, which provides a framework for managing water use.
Total water withdrawal is the sum of all measured withdrawn water volumes, or calculated
water volumes based on pumps readings. The sources of water withdrawal include surface
water, seawater, municipal water, groundwater, and rainwater. Rainwater is estimated by
multiplying the annual rainfall precipitation by the area from which rainwater is collected. If
evaporation data is available, as in the case of the Kemi mine, where it is calculated using
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a simulation program, this data is also incorporated to refine the estimation, leading to
more accurate results. In addition to evaporation, runoff coefficients are applied, which can
vary based on surfaces such as roofs, asphalt, or soil.
Total water discharged is the sum of all discharged measured water volumes, or calculated
water volumes. The calculated water volumes can be based on pump readings, or can be
based on the system design. In some cases, estimations may be necessary, if complete
data for calculations is not available, with assumptions based on past practices and
historical data. The discharged volumes can be directed to municipal treatment facilities,
surface water bodies, groundwater or seawater.
Outokumpu’s total water consumption is calculated as the difference between total water
withdrawal and total water discharged. For offices and service centers, total water
consumption is based on the full-time equivalent (FTE).
In 2024, 93.7% of total water withdrawal volumes were based on measurements, 0.06%
were based on sampling and extrapolation, and 6.24% were based on estimations. For total
water discharged volumes, 87.16% were based on measurements, 0.06% were based on
sampling and extrapolation, and 12.78% were based on estimations. Thus, the total water
consumption for the reporting period is broken down as follows: 89.53% of water volumes
were based on measurements, 0.06% were based on sampling and extrapolation, and
10.41% were based on estimations.
Consumption in areas at water risk
At the San Luis Potosí site, total water consumption is calculated as the difference
between the total water withdrawn and the total water discharged. Withdrawal volumes are
directly measured, while discharged volumes are partially measured and partially
estimated. The water withdrawn is municipal water and groundwater, and it is discharged
back to the same sources. Unlike other sites, the San Luis Potosí site does not collect and
include rainwater in its water balance calculations due to the absence or negligible amount
of rainwater volumes. To enhance water use efficiency, the site not only uses treated water,
but also purchases additional treated water externally.
Total water recycled and reused
At Outokumpu, the volumes of recycled water are counted only once, regardless of how
many times the water is recycled within the system. For instance, if 10 m³ of water is
recycled 10 times, it is considered as 10 m³ of recycled water. If 10 m³ of water recycled
10 times would be considered as 100 m³, this would represent the theoretical volume that
could have been withdrawn but was not. According to the ESRS definition, recycled water
refers to water or wastewater that is used more than once before being discharged.
Considering theoretically saved water as recycled water would not comply with the ESRS
definition, as these volumes were never discharged and present in the system. Additionally,
these volumes would vastly exceed withdrawn water amounts. To provide an accurate
representation, the approach of counting recycled water volumes only once is applied.
Water recycling in operations takes place within cooling systems, and through the recycling
of treated water back to the processes. In cooling systems, make-up water volumes serve
as the foundation for calculating recycled water volumes. Treated water is also recycled at
the sites, reducing the need to withdraw water from natural sources. Water recycling occurs
not only at stainless steel sites but also at the mine. In Kemi mine, around 99% of
withdrawn water was recycled during 2024.
At Outokumpu, apart from recycled water, there is also reused water, which, according to
the ESRS definition, refers to water that has been used in one process and then
repurposed for another. There are different ways of reusing water, depending on the site
and its specific processes. Reused water volumes are reported together with recycled
volumes in the table "Water consumption data for own operations”.
Recycled and reused water volumes can be either directly measured if make-up or treated
water volumes returned to the process are metered, calculated if data on make-up water
flow and production time is available, or estimated if data is based on historical data and
specific assumptions.
Total water stored
For total water stored, Outokumpu applies the GRI definition of water held in water storage
facilities or reservoirs. Water ponds are not considered as water storage. The water storage
volumes are measured. The changes in water storage during the reporting period are 0, as
water is continuously retrieved and supplied to the storage.
Water quality and quantity at water basins
Authorities or local water associations measure their respective water basins’ water quality.
Water basins’ water quantity is usually measured in flow rate. (E3-4-28-(e)), (E3-4-MDR-M-77-(a))
External validation
The data related to water resources is not validated by any external body other than the
assurance provider. (E3-4-MDR-M-77-(b))
Water intensity
Metrics
Volume (m³)
Net Revenue
(Million EUR)
Water Intensity
(m³/Million EUR)
Water consumption and intensity
6,289,440
5,942
1,058.52
(E3-4-29)
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E4 – Biodiversity and
ecosystems
Biodiversity and ecosystems were identified as material for Outokumpu in its double
materiality assessment.
Material impacts, risks and opportunities resulting
from the materiality assessment
E 4.1 Biodiversity and ecosystems
Impacts
Negative
The operations of production sites can potentially impact on local biodiversity. In the
upstream value chain, especially mining can potentially cause a substantial impact on
biodiversity and ecosystems.
Risks and
opportunities
Risk
Increased regulation may lead to increased operational costs and reporting, and risks
arising from failure to comply to Outokumpu and its operations. Not addressing
biodiversity concerns can cause pressure from the financial sector, business
environment and society on Outokumpu and its operations.
(ESRS 2-SMB 3-48-(a))
Strategy
Transition plan and consideration of biodiversity
and ecosystems in strategy and business model
Outokumpu has considered the resilience of its current business models and strategy to
biodiversity and ecosystems-related physical, transition and systemic risks and
opportunities during its double materiality assessment process. In addition, resilience was
also assessed in biodiversity screening. (E4-1-13-(a), (c))
Outokumpu’s double materiality assessment covered its operations and downstream value
chain, while the biodiversity screening performed in 2023 focused on Outokumpu’s own
operations. (E4-1-13-(b)) In the biodiversity screening, the company used location-based
screening with a ten-kilometer threshold from its sites when assessing biodiversity
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Biodiversity loss is one of the triple planetary
crises humanity faces, along with climate change
and pollution. As businesses rely on natural
resources, they must also protect them.
Outokumpu contributes to mitigating biodiversity
loss through the reduction of greenhouse gas
emissions and virgin resource material
dependency by using over 90% recycled raw
materials in its production.
KEY ACTIONS in 2024
Included biodiversity loss
mitigation in the
Sustainability Policy.
Development of biodiversity
management plans for
business lines.
Established site-spesific
biodiversity plans.
Joined UN Global Compact
Finland’s training program for
science-based targets for
nature.
PLAN 2025
Assess biodiversity impacts,
action plan and strategy, in a
global scope over a time
horizon until 2030.
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
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Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
sensitivity. (E4-1-13-(c)) The analysis considered a long-term time horizon of ten years.
(E4-1-13-(d))
The conclusion of the biodiversity screening on direct operations was that there are no
systemic risks for Outokumpu. Local physical risks related to biodiversity are currently most
relevant to Outokumpu, but transitional risks will increase over the years. (E4-1-13-(c), (e))
Outokumpu assessed its stakeholders views by interviewing customers, suppliers, investors,
non-governmental organizations, and external industry specialists when conducting the
double materiality assessment. (E4-1-13-(f))
Material biodiversity-related impacts, risks and
opportunities and their interaction with the strategy
and business model
List of material sites
Outokumpu has conducted a study to screen its direct biodiversity risks and impacts.
Outokumpu’s production processes were categorized according to the Global Industry
Classification Standard and its risk profile was assessed using ENCORE and IBAT rating
data. After assessing the results of the screening, based on the local environmental
factors, five production sites were categorized as material.
The business activities in service centers and offices are likely to be very limited in terms of
impacts and dependencies on nature, as Outokumpu’s sites are mostly located in urban
commercial or industrial areas, and there is little connection with the natural world
surrounding the areas. (E4-ESRS 2 SBM-3-16-(a))
Areas of high biodiversity value
Even though Outokumpu’s sites are not located in sensitive areas, Outokumpu has
identified areas of high biodiversity value that are owned by the company or located nearby
its sites. Activities on these sites include both stainless steel manufacturing and chrome
mining. (E4-ESRS 2 SBM-3-16-(a)-(i)) The sites in Calvert, Alabama in the US, Dahlerbrück and
Dillenburg in Germany, and Kemi and Tornio in Finland have been assessed to have high
biodiversity value and categorized as material. (E4-ESRS 2 SBM-3-16-(a)-(ii))
Dahlerbrück is the only Outokumpu site, in which a 0.042 km² protected area, based on
the EU’s Natura legislation, is partly located on the company’s property. The site has not
identified impacts on the protected area.
At the Kemi mine, there is a Natura 2000 area located next to the property border in the
northwest and in the east. However, there is no indication of a negative impact caused by
the mining activities on biodiversity.
Tornio’s integrated ferrochrome and stainless steel plant is located near the Tornionjoki
river and on the northern coast of the Gulf of Bothnia. The river is protected according to
EU Natura legislation. The impacts on the Gulf of Bothnia have been analyzed since 1975
and based on the results they are not significant. The river is located upstream from the
Tornio site, and the site is thus assessed not to have significant impacts on the river.
In Outokumpu’s site in Calvert, Alabama, in the US, there are some 80 hectares of property
in the plant defined as wetland, including some restrictions on land use. The site
management has identified, as a biodiversity aspect, that part of the wetland area is home
to quite a wide array of wildlife, such as wild turkeys, wild bears and gopher tortoises,
among other species. The company has not identified negative impacts on the wildlife.
(E4-ESRS 2 SBM-3-16-(a)-(iii))
Land degradation, desertification or soil sealing,
and threatened species
As to the impacts, Outokumpu has not identified negative impacts regarding land
degradation, desertification, or soil sealing. (E4-ESRS 2 SBM-3-16-(b)) Overall, Outokumpu has
not identified threatened species affected by its operations. (E4-ESRS 2 SBM-3-16-(c))
Impact, risk and opportunity
management
Policies
Policies related to biodiversity and ecosystems
Key contents of policies
According to Outokumpu’s Sustainability Policy, Supplier Code of Conduct and Raw
Materials Supplier Requirements, biodiversity aspects, such as land-use change, direct
exploitation, pollution, and state of species, are considered in decision-making and
management of change and assessed in the environmental impact assessments and
permit processes of operations.
Outokumpu demonstrates its commitment to biodiversity by safeguarding ecosystems and
maintaining favorable conditions. The company manages negative impacts on biodiversity,
and if necessary, undertakes remediation efforts, all in accordance with the mitigation
hierarchy principles.
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Outokumpu supports protecting biodiversity at its production sites near high-risk
biodiversity areas as well as within its value chain and engages with local communities on
nature-related matters including social impacts, whenever deemed material.
(E4-MDR-P-65-(a))
Scope, accountability, stakeholders, availability,
and third-party standards
More information about Outokumpu’s Sustainability Policy and its scope, the approval
process for the policy, disclosure of third-party standards, consideration given to key
stakeholders, and the availability of the policy, can be found in the Climate change (E1)
chapter, in the Policies section.
More information about Outokumpu’s Supplier Code of Conduct and Raw Materials Supplier
Requirements and their scope, the approval process for the policies, disclosure of third-
party standards, consideration given to key stakeholders, and the availability of the policy,
can be found in the Workers in the value chain (S2) chapter in the Policies section. (E4-MDR-
P-65-(b-f))
Addressing material areas in policies
Outokumpu’s Sustainability Policy, Supplier Code of Conduct and Raw Materials Supplier
Requirements cover contributions to impact drivers of biodiversity loss and impacts on
ecosystems. (E4-2-23-(a))
While Outokumpu contributes to maintaining biodiversity globally especially through the
reduction of greenhouse gas emissions and virgin resource material dependency, through
the above-mentioned policies Outokumpu also prevents and reduces its impacts on
biodiversity and ecosystems. Outokumpu has risk-based environmental management to
prevent incidents and reduce waste, pollution and emissions into air and discharges into
water as well as harmful impacts related to noise and vibration. In the event of unforeseen
water or soil contamination, Outokumpu seeks to remediate, whenever viable, negative
impacts and restore the environment as close as possible to the state prior to the event.
In addition, Outokumpu expects its raw material suppliers to ensure that the materials and
services are produced in a sustainable and energy-efficient way that minimizes negative
impacts on the environment. This includes minimizing greenhouse gas emissions,
sustainable sourcing of renewable raw materials, conserving resources, and protecting
biodiversity. (E4-2-23-(b))
Material dependencies, risks and opportunities
Outokumpu’s Sustainability Policy covers material dependencies as well as material
physical and transition risks and opportunities that relate to biodiversity and ecosystems.
As mentioned earlier, one of Outokumpu’s most significant contributions to mitigating
biodiversity loss is to minimize the use of virgin resources. The company utilizes the
identified opportunities in resource inflows, outflows, and waste management, as well as in
by-products and recovery of waste.
Furthermore, Outokumpu is committed to minimizing material water consumption in
production plants in those geographic areas that experience high water risk. Outokumpu
also considers sustainable sourcing of water in operations whenever viable and aims to
reduce environmental impact through water reuse and wastewater treatment and frequently
assesses impact on water. (E4-2-23-(c))
Traceability
Outokumpu's Supplier Code of Conduct and Raw Materials Supplier Requirements cover
supplier requirements on transparency in biodiversity. According to these policies, suppliers
and subcontractors shall ensure that all environmental risks are identified and assessed,
mitigated by setting environmental improvement targets, and monitored, evaluated and
reported.
Suppliers are expected to co-operate in a transparent manner with Outokumpu:
documenting compliance, providing information to Outokumpu on request, and, if
considered necessary by Outokumpu, granting Outokumpu or a third party authorized by
Outokumpu, the possibility to conduct audits in their facilities. The supplier must also
evaluate and monitor their own supply chain and provide proof of their practices if
requested by Outokumpu.
Raw material suppliers shall have a system for identifying their products by type and lot or
serial number, and their status during all stages of production and testing. Suppliers shall
maintain a method of traceability that ensures tracking of the supply chain back to the
manufacturer of all items included in the product being supplied. (E4-2-23-(d))
Sourcing and social consequences
Outokumpu’s Sustainability Policy states that Outokumpu supports protecting biodiversity
at its production sites near high-risk biodiversity areas as well as within its value chain. The
policy also addresses consumption from ecosystems, such as water. The Raw Materials
Supplier Requirements state that suppliers shall be able to provide a plan to manage risks
and impacts on environment, covering also biodiversity, including a plan to remediate
potential negative impacts. (E4-2-23-(e))
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Outokumpu engages with local communities on nature-related matters, including social
impacts, whenever deemed material. The company also engages with representatives of
affected communities close to its own operations and along the supply chain, including on
environmental topics. (E4-2-23-(f))
Sustainability Policy coverage
Outokumpu’s Sustainability Policy covers operational sites owned, leased, or managed in or
near protected areas or biodiversity-sensitive areas outside protected areas. (E4-2-24-(a))
Actions and resources
Actions and resources related to
biodiversity and ecosystems
Key actions
Key actions related to biodiversity and ecosystems at Outokumpu in 2024 were:
•
biodiversity identified in material topics in sustainability strategy and embedded into the
sustainability policy of the company,
•
new biodiversity management plans for Business Area Europe based on direct
biodiversity impacts,
•
established local biodiversity plans, and
•
started a process to address potential biodiversity impacts in the value chain.
In addition, Outokumpu also participates in the UN Global Compact Finland's training
program, which focused on science-based targets for nature, with 14 other companies.
Moving forward, Outokumpu will assess the biodiversity impacts, action plan and strategy,
and continue the work based on the outcome. The work on addressing the value chain
impacts, and developing the site-level biodiversity action plans will also continue.
(E4-MDR-A-68-(a))
Scope and time horizon
The assessment of the biodiversity impacts, action plan and strategy will be done on a
global scope with a time horizon until 2030 (E4-MDR-A-68-(b)), and will be completed by the
end of 2025. (E4-MDR-A-68-(c)) Outokumpu has not provided a remedy for biodiversity and
ecosystem-related impacts in 2024. (E4-MDR-A-68-(d))
Prior progress
Outokumpu contributes to maintaining biodiversity globally especially by reducing
greenhouse gas emissions and virgin resource material dependency. Progress on these
topics is explained in the chapters on Climate change and Resource use and the circular
economy. Additionally it was disclosed in the previous annual report that Outokumpu will
start implementing local biodiversity action plans. The work has been started, and it will
continue moving forward. (E4-MDR-A-68-(e))
Biodiversity offsets
Offsetting has not been used during the reporting year for Outokumpu’s biodiversity work.
However, Outokumpu has been, for example, planting fish near its sites in Kemi and Tornio,
Finland. In Kemi, Outokumpu is planting 10,000 pike-perch yearly, while the environmental
permit requires the company to plant 6,000 pike-perch yearly to compensate for water
discharges. In Tornio, Outokumpu is paying the environmental authority a fee yearly, with
which fish stocking of migratory white wish and sea trout is organized twice a year.
Outokumpu’s site in Tornio is also paying a water protection fee annually to the Finnish-
Swedish border river commission, which enables the commission to support studies and
projects related to water management. The company will assess the role of offsetting as
part of developing its biodiversity action plan during 2025. (E4-3-28-(b), (b)-(i), (b)-(ii))
Incorporation of local and indigenous knowledge
Outokumpu is developing a group-wide approach to engaging affected communities in its
action plans. Therefore, direct interaction with the affected communities on biodiversity
was not included in the double materiality assessment process. Outokumpu is currently
developing sustainability due diligence process to cover both its own operations and the
value chain. Gap analysis and a related action plan to further develop the due diligence
process steps were completed in 2024. Outokumpu will continue planning how to engage
with affected communities directly.
Locally, Outokumpu has been consulting the affected communities regarding nature-based
solutions for example during the environmental permit process and environmental impact
assessments. In Kemi, the company also has continuous dialogue with a local bird
association to ensure for example that Outokumpu is taking bird-life into account in its
operations. (ESRS E4-3-28-(c))
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Environmental information
Social information
Governance information
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Auditor's Report and Assurance Report
Governance and remuneration
Metrics and targets
Targets related to biodiversity and ecosystems
Outokumpu contributes to maintaining biodiversity globally especially by reducing
greenhouse gas emissions and dependency on virgin resources, and it has set targets for
these. The company has not set specific, group-wide biodiversity targets. The progress in
reducing greenhouse gas emissions and using recycled raw materials is described in the
chapters on Climate change (E1) and Resource use and the circular economy (E5). (E4-MDR-
T-81-(b); E4-4-32-(a), (a)-(i), (ii), (iii)); E4-4-32-(b-c))
Outokumpu is tracking the development of biodiversity drivers in its own operations, such
as emissions, water consumption, waste and pollution. The company is also reviewing
biodiversity plans and actions with own sites. Biodiversity is also part of the supplier
assessment processes for risk categories, such as mining. (E4-MDR-T-81-(b)-(i))
Outokumpu's Sustainability Policy, Supplier Code of Conduct and Raw Materials Supplier
Requirements define the ambition level and expectations. In addition biodiversity
management plans for business lines Stainless Europe and Advanced Materials define the
expectations for the company’s own operations. The company is also guided by the
requirements of the ResponsibleSteel and Toward Sustainable Mining standards. (E4-MDR-
T-81-(b)-(ii))
Outokumpu’s targets for greenhouse gas emissions and use of recycled raw materials are
global (E4-4-32-(d)), and in the mitigation hierarchy, these targets strive to avoid and reduce
impacts. (E4-4-32-(f)) Outokumpu does not use offsets in target setting. (E4-4-32-(e))
Impact metrics related to biodiversity
and ecosystems change
As Outokumpu does not have a separate global metric for biodiversity, there is also not a
metric to evaluate its effectiveness. Outokumpu follows its contribution through the
reduction of greenhouse gas emissions and virgin resource material dependency, and more
information on the impact of reducing greenhouse gas emissions and using recycled raw
materials is given in the chapters on Climate change (E1) and Resource use and the circular
economy (E5). (E4-5-MDR-M-75, E4-5-MDR-M-77-(a-b))
Sites located near biodiversity-sensitive areas 2024
Description
Number of sites
Area (hectares)
Owned
5
2,121
Leased
1
238
Managed
—
—
(ESRS E4-5-35)
Change of land, freshwater and sea use
Outokumpu is not currently measuring changes in land, freshwater and sea usage. (E4-5-38)
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General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
E5 – Resource use and
the circular economy
Use of resources, the circular economy and waste management were identified as material
for Outokumpu in its double materiality assessment.
Material impacts, risks and opportunities resulting from
the materiality assessment
E 5.1 Resource inflows/use of resources
Impacts
Positive
Outokumpu’s stainless steel is produced over 90% from recycled raw materials which
reduces dependency on virgin raw materials. Reducing the need for primary material
also reduces overall greenhouse gas emissions and mitigates biodiversity loss in the
upstream value chain. This is an actual positive impact valid in the upstream value
chain.
Negative
Mineral extraction often has substantial environmental and social impacts adversely
affecting local communities, workers and ecosystems. Main part of primary ferroalloys
(except ferrochrome) come from countries with higher risk than Europe. This is an
actual negative impact valid in the upstream value chain.
Risks and
opportunities
Opportunity
The increased demand for low-emission stainless steel presents an opportunity for
using recycled steel in production. This opportunity is valid in direct operations.
Outokumpu gains a competitive advantage by sourcing ferrochrome with a low-carbon
footprint from its mine in Kemi. This opportunity is valid in direct operations.
The company has identified further potential to achieve increased efficiency by
enhancing metal recycling, optimizing resources and using significant amounts of
scrap metal instead of primary raw materials. This opportunity is valid in direct
operations.
Risk
Outokumpu has identified that the availability of low-emission raw materials and price
changes especially in alloy metals such as nickel and chrome may have a significant
financial impact. This risk is valid in direct operations.
Reliance on ferroalloys from countries with geopolitical tensions pose supply chain
and regulatory risks. This risk is valid in direct operations.
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A circular economy is vital for tackling climate
change. Outokumpu’s business is based on the
circular economy: its stainless steel products are
made of over 95% recycled material content which
reduces the use of virgin resources and results in
mitigating biodiversity loss and reducing
greenhouse gas emissions.
KEY ACTIONS in 2024
Optimizing scrap sourcing
(over 90% scrap input in steel
production)
Recovering valuable metals
from slag and dust.
Managing waste from
operations to minimize the
risk of improper disposal.
Ensuring safe and responsible
waste disposal.
Conducting regular audits and
monitoring at all sites.
PLAN 2025–2027
Developing strategies to
minimize waste generation.
Creating site-specific plans
for waste efficiency
improvement.
Integrating emergency
preparedness for waste
contamination into site-
specific emergency plans.
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
E 5.2 Resource outflows/circular economy
Impacts
Positive
Outokumpu recycles, reuses and utilizes materials such as metals from dust and
scales, recovered lime, bricks, and recycled sludge, thus reducing the need for virgin
materials and associated impacts on the environment. By developing by-products from
slag, Outokumpu reduces waste generation and minimizes primary raw materials. This
is an actual positive impact valid in direct operations, and the upstream and
downstream value chains.
Negative
The use of industrial by-products and waste such as slags can lead to potential
environmental issues, if not handled properly. This is potential negative impact valid in
direct operations and downstream value chain.
Risks and
opportunities
Opportunity
Utilization of by-products presents new market opportunities. In addition, stainless
steel is a durable, long-lasting material that can be recycled and reused from scrap to
produce a new product. These opportunities are valid in direct operations.
E 5.3 Waste management
Impacts
Positive
Outokumpu reduces landfill waste through recycling metals and acids, repurposing
recovered materials in production, and developing slag by-products to reduce waste.
This is an actual positive impact valid in direct operations, and the upstream and
downstream value chains.
Negative
Landfill waste from production processes, including slag, tailing sand, sludges, dust,
and scales, poses environmental risks. This is an actual negative impact valid in direct
operations. Hazardous waste from steel recycling, such as electric arc furnace dust,
can contaminate the environment and pose health risks if not properly managed,
leading to regulatory and cost challenges. This is a potential negative impact valid in
direct operations and the downstream value chain.
Risks and
opportunities
Opportunity
Outokumpu's development of slag-based by-products for applications such as
refractory and concrete production creates opportunities for new revenue streams.
This opportunity is valid in direct operations. Reducing waste streams, especially
hazardous ones, and recycling or selling non-hazardous by-products, can lower
regulatory risks and costs while boosting revenues. This opportunity is valid in direct
operations.
Risk
Increased prices for land filling and waste treatment pose a financial risk for
Outokumpu by raising operational costs, while the long-term impacts of waste disposal
may result in significant financial impacts including liability for the remediation of
contaminated sites. These risks are valid in direct operations.
(ESRS 2-SMB 3-48-(a))
Impact, risk and opportunity
management
Policies
Policies related to resource use
and the circular economy
Key contents of policy
Outokumpu is committed to sustainable production and aims to minimize the use of
resources by the means of the circular economy, as stated in the company’s Sustainability
Policy. The company is committed to minimizing the use of primary raw materials by using
recycled or renewable materials, and it utilizes the identified opportunities in resource
inflows, outflows, and waste management.
Outokumpu’s Supplier Code of Conduct expects all suppliers to be committed to
responsible production, aim to minimize the use of resources, and use recycled materials
where possible. (E5-MDR-P-65-(a))
Scope, accountability, stakeholders, availability,
and third-party standards
More information about Outokumpu’s Sustainability Policy and its scope, the approval
process for the policy, disclosure of third-party standards, consideration given to key
stakeholders, and the availability of the policy, can be found in the Climate change (E1)
chapter, in the Policies section.
More information about Outokumpu’s Supplier Code of Conduct and Raw Materials Supplier
Requirements and their scope, the approval process for the policies, disclosure of third-
party standards, consideration given to key stakeholders, and the availability of the policy,
can be found in the Workers in the value chain (S2) chapter in the Policies section. (E5-MDR-
P-65-(b-f))
Addressing material areas in policy
Outokumpu’s Sustainability Policy addresses transitioning away from virgin resources by
committing to minimizing the use of primary raw materials and using recycled or renewable
materials and by prioritizing renewable raw material sources over non-renewable options
whenever viable. (E5-1-15-(a)) The Sustainability Policy further addresses sourcing of
sustainable and renewable resources by stating that Outokumpu ensures a stable and
secure supply chain for recycled materials. This is further elaborated in Outokumpu’s
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Supplier Code of Conduct, in which it is stated that Outokumpu expects its suppliers to be
committed to responsible production, to aim to minimize the use of resources, and to use
recycled materials where possible. (E5-1-15-(b))
Actions and resources
Actions and resources related to resource use
and circular economy
Key actions
Stainless steel operating sites
Key actions taken in the reporting year:
•
identifying and matching scrap supply with planned product mix in order to achieve
>90% scrap input in steel,
•
continuously screening incoming raw materials to identify and remove any radioactive
sources to ensure that the steel does not become contaminated with radioactivity,
•
extracting valuable metals from slag and dust to recycle them as raw materials and thus
reduce the need for virgin metals,
•
identifying and categorizing waste generated by its operations, to minimize risk of
disposing of the waste in an inappropriate way which could cause contamination,
•
safe and responsible disposal of waste by collaborating with licensed waste
management providers,
•
regular audits and monitoring at all sites to ensure compliance with standards – the
yearly ISO 14001 surveillance audits were conducted during the reporting year at the
sites and covered resource use and waste-related matters, and additionally, internal
environmental audits were performed throughout the reporting year, addressing resource
use and waste-related topics,
•
training to employees on waste management, and
•
regularly reviewing applicable local and national regulation to meet requirements.
Key actions planned for the future are based on the waste management plan developed by
Outokumpu. The waste management plan outlines Outokumpu's commitment to minimizing
environmental impacts through effective waste management. Key actions planned are:
•
Implementation of a review of the types of waste whenever there is a significant change
to the company’s processes, or at least every 5 years: the expected outcome is a better
understanding of the company’s waste streams, enabling improved waste management,
•
Development of strategies to minimize waste generation from its operations. The
expected outcome is a reduction in overall waste generation, improved resource
efficiency, and cost savings. The implementation of the action contributes to the
achievement of Outokumpu’s Sustainability Policy, aligning with Outokumpu's
commitment to reduce environmental impact.
•
Development of a continuous improvement plan for each site that outlines its strategy
for enhancing waste management and resource efficiency. The expected outcome will be
the establishment of better monitoring systems and processes, along with improved
data collection and reporting methods. The implementation of this action supports
Outokumpu’s Sustainability Policy by proactively monitoring input materials and waste-
related matters.
•
Integration of emergency preparedness at each site for spills and other types of waste
contamination into their specific emergency plans. The expected outcome is improved
readiness to respond effectively to spills and waste contamination, minimizing
environmental impact. The implementation of the action supports Outokumpu's
Sustainability Policy by reinforcing its commitment to minimizing environmental impact
and proactively adopting precautionary measures to prevent incidents and reduce waste.
Mine operations
Key action taken in the reporting year in Kemi mine is based on its waste management
plan. The mine has a thorough waste management plan that includes details about
extractive waste, the utilization of such waste, designated waste areas, the environmental
impacts, measures to prevent pollution, and operational monitoring.
Key action taken was to enhance characterization information, Kemi mine started more
detailed drill core sample analysis from the gangue in 2024. The formed gangue is utilized
in the mine directly. Currently, there are no specific key actions regarding waste
management planned in Kemi, but Outokumpu is actively working on developing them.
Kemi mine’s waste management plan was developed to meet the requirements of the
Towards Sustainable Mining standard. The waste management plans support waste
management policy objectives. (E5-MDR-A-68-(a))
Scope and time horizon
The waste management plan and future key actions include the company’s own operations,
and also cover, to some extent, downstream waste recovery operations. The future key
actions from the waste management plan mentioned previously include business line
Stainless Europe’s sites (Krefeld and Tornio), and business line Advanced Materials’ sites
(Avesta, Nyby, Degerfors and Dillenburg). Production sites in Calvert in the US and San Luis
Potosí in Mexico are developing actions related to waste management. Outokumpu intends
to develop comprehensive waste management action plans for all its sites in the future.
(E5-MDR-A-68-(b))
Each key action, namely the implementation of the review of waste types, the development
of strategies to minimize waste generation, the development of an improvement plan for
waste management, and the integration of emergency preparedness for waste
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contamination in the emergency preparedness plan, is planned to be completed within a
medium-term time horizon. The development of strategies and an improvement plan, as
well as the integration of emergency preparedness plan key actions are planned to be fully
completed by the end of 2027. (E5-MDR-A-68-(c)) In 2024, Outokumpu has not had cases of
harm by actual material impacts that would require actions. (E5-MDR-A-68-(d))
Prior progress
Outokumpu has previously disclosed an ambition to have a minimum of 90% recycled
material content in its steel. This target has already been reached several years in the row
and the company continues to work towards the target in the following years.
(E5-MDR-A-68-(e))
Metrics and targets
Targets related to resource use
and the circular economy
Outokumpu has not yet set specific waste- or resource-related targets, since Outokumpu
has been ensuring progress through actions, policies, monitoring, and key performance
indicators (KPIs). However, the company plans to assess potential waste targets by the end
of 2025. (E5-MDR-T-81-(a))
Outokumpu tracks the effectiveness of its policies and actions related to resource use and
the circular economy as well as waste impacts, risks, and opportunities through different
processes. (E5-3-24-(e), E5-MDR-T-81-(b)) The effectiveness is tracked through monitoring
processes. The tracked metrics are outlined in more detail below in the “Tracking
performance and effectiveness” section. In addition to metrics and KPIs, Outokumpu tracks
the effectiveness of its policies and actions through other processes, including regular
audits and engagement with stakeholders. (E5-MDR-T-81-(b)-(i))
For resource use, circular economy and waste-related topics, Outokumpu's Sustainability
Policy as well as the Supplier Code of Conduct define the ambition level and expectations.
According to the Sustainability Policy, Outokumpu is committed to minimizing the use of
primary raw materials by using recycled and recovered metals as far as possible as raw
material for its steel. By setting a KPI for recycled material content in steel, Outokumpu
ensures a continuous high rate of circular material use as well as minimizes the use of
primary raw materials in steel. Outokumpu’s current KPI address recovered and recycled
metals. Outokumpu maintains a group-level internal recycled material content KPI for it’s
steel products. The ambition is to annually reach over 90% recycled material content and in
2024 the company reached 95.3%. (E5-MDR-T-81-(b)-(ii))
These targets do not address other matters related to resources or the circular economy.
(E5-3-24-(f))
Resource inflows
Tracking performance and effectiveness
In terms of metrics used to evaluate performance and effectiveness, in relation to material
impact, risk or opportunity, for resource inflow, the material opportunity is to use as much
recycled metals as viable in the steel making process. For the ferrochrome process,
Outokumpu has identified the use of biomass as the best option to mitigate risks identified
in the double materiality assessment. (E5-4-MDR-M-75)
Data collection, methodologies and assumptions
The recycled material content KPI gives the share of recycled and recovered metals used to
manufacture the steel products in relation to total steel produced. The calculations are
aligned with ISO 14021 and exclude recovered metals generated in the same steel making
process. The method is also aligned with the EU taxonomy criteria for use of recycled steel
in steel manufacturing. Packaging and consumables like pickling acids that are not part of
the product are not included in this KPI calculations.
For calculation of total material use, raw materials and utilities for production of all
products, including packaging, are considered. More information can be found in the table
“Materials used in the process” below.
Calculation is based on measured consumption where data is available. Otherwise
purchased amounts are used. (E5-4-MDR-M-77-(a)) The KPI for recycled content of
Outokumpu’s steel products has been verified against ISO 14021 by TÜV SÜD. (E5-4-MDR-
M-77-(b))
Outokumpu’s most important raw material is recycled steel, from both stainless and carbon
steel. All of Outokumpu’s stainless steel mills can be considered as significant recycling
facilities, and the company recycles over two million tonnes of metals per year. In addition
to recycled steel, Outokumpu uses primary alloys to get the right alloying composition in
the steel. The most important alloys are nickel and chrome, which are added in the
production mainly as ferrochrome and ferronickel. Outokumpu also uses small amounts of
other metal alloys, including rare earth metals. Slag formers, such lime and ferrosilica, are
also used in the process, resulting in slag by-products.
The company makes its own ferrochrome, and in that process the main inputs are chromite
from the company’s Kemi mine and coke.
In addition to the above-mentioned technical materials, pickling acids that are used in the
process are also material and are thus included in the table of materials used below.
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A significant amount of water is used in Outokumpu’s production processes, for example for
cooling. The company uses mainly surface water for these purposes. Water is not included
in the resource use table in this chapter. More information about water management is
available in the chapter on Water resources (E3).
Metal alloys are the most material upstream resources. The inflows to produce these
upstream resources are mainly metal ore, energy and water. (E5-4-30)
Materials used in the process
Product and material category, Weight (tonnes) or %
2024
Total weight of products and materials
4,564,152
Weight of biological materials
19,542
% of biological materials of total weight
0.4
Weight of secondary or recycled materials
2,275,966
% of secondary or recycled materials of total weight
49.9
(E5-4-31-(a-c))
Outokumpu weighs all raw materials entering its processes when the materials arrive at the
company’s sites. The data reported for the year is based on direct measurement. (E5-4-32)
No double counting can occur, as Outokumpu does not declare reused inflows. (E5-4-AR-25)
Resource outflows
Tracking performance and effectiveness
Outokumpu tracks its performance and effectiveness related to material impacts, risks, and
opportunities for resource outflow through several key metrics. These include the total
waste generated; the total waste diverted from disposal (preparation for reuse, recycling,
and other recovery operations) broken down into hazardous and non-hazardous waste
categories; and the total waste sent for disposal (incineration, landfill, and other disposal
operations) broken down into hazardous and non-hazardous waste categories. Metrics also
cover non-recycled waste, the percentage of non-recycled waste, and the total hazardous
and radioactive waste produced. All the metrics can be found in the tables in the "Waste”
section. (E5-5-MDR-M-75)
Further information on the methodologies for the metrics mentioned above can be found in
the “Methodologies for data collection” section. (E5-5-MDR-M-77-(a)) No external body other
than the assurance provider has provided validation. (E5-5-MDR-M-77-(b))
Products and materials
Outokumpu’s main products are semi-finished products of stainless steel from the Europe
and Americas business areas. In addition, the Ferrochrome business area produces
ferrochrome, which is used as a raw material in the making of steel, both in Outokumpu’s
own steel making operations and when sold to other steel producers. The stainless steel
semi-finished products (mainly coils and plates) are used by Outokumpu’s customers
further down the value chain to manufacture stainless steel products that are used for
appliances, automotive, architecture, building and construction, metal processing and
tubes, chemical and petrochemical, and heavy industries. (E5-5-35)
Expected durability and recyclable content
Outokumpu main product, stainless steel, had during 2024 a recycled content of 95%
(calculated according to ISO 14021). Outokumpu's ferrochrome products and slag products
do not contain any recycled materials so the weight of secondary materials of total input
materials is lower when taking all produced materials into account. The share of recycled
material of all input materials and products is 49.9 % as outlined in the “Materials used”
table on this page. Stainless steel is often used for its corrosion resistance, which is
attributed to the passive film that forms on the surface spontaneously in contact with air,
protecting the material from corrosion. The life-time of the application depends on the
application rather than the stainless steel. It can vary from about six months when used in
for example mobile phones to 60 years in buildings or 120 years in constructions such as
bridges. As a steel supplier it is not possible to relate the durability of Outokumpu material
in relation to industry average since the products are semi finished steel products which
are manufactured into new products within weeks of delivery. However, Outokumpu helps
its customer to increase the durability of their products by supplying information and advice
on which steel grades are suitable for different applications, thus prolonging the life time of
the customers’ products. The recyclable content of stainless steel is 100%. The packaging
consist of different plastics that are recyclable, if sorted, and wooden pallets that can be
reused. The share of packaging is between 0.3% and 0,4% of the product and will not
impact the overall recyclability.
Ferrochrome is mainly used as a raw material in steel manufacturing, which is why it is
impossible to estimate durability. Slag products are minerals that are mainly used to
replace primary raw materials such as sand and gravel in for example road construction as
a base layer, with an expected durability the same as for the road. Ferrochrome and slag
are not recyclable as such since they are intended to be included in other products.
However, the metallic constituents of ferrochrome; iron and chromium, are recycled as part
of the steel when the end-product is discarded.
The main packaging used for stainless steel semi-finished products are plastic covers and
wooden pallets. The plastics contain 70% recycled content on average. The pallets are
sometimes re-used but new pallets are made out of virgin wood. (E5-5-36-(a), (c))
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Waste
Total amount of waste generated
Particulars of waste generated, Quantity (tonnes)
Type
2024
Total amount of waste generated
2,787,009
Total amount of waste diverted from disposal
1,292,626
Total amount of hazardous waste diverted from
disposal
57,896
Hazardous waste diverted from disposal
Preparation for
reuse
0
Hazardous waste diverted from disposal
Recycling
57,541
Hazardous waste diverted from disposal
Other recovery
operations
355
Total amount of non-hazardous waste diverted from
disposal
1,234,730
Non-hazardous waste diverted from disposal
Preparation for
reuse
15,846
Non-hazardous waste diverted from disposal
Recycling/Stored1)
1,214,603
Non-hazardous waste diverted from disposal
Other recovery
operations
4,281
Total amount of waste directed to disposal
1,494,384
Total amount of hazardous waste directed to disposal
59,371
Hazardous waste directed to disposal
Incineration
0
Hazardous waste directed to disposal
Landfill
59,299
Hazardous waste directed to disposal
Other disposal
operations
72
Total amount of non-hazardous waste directed to
disposal
1,435,013
Non-hazardous waste directed to disposal
Incineration
0
Non-hazardous waste directed to disposal
Landfill
1,435,013
Non-hazardous waste directed to disposal
Other disposal
operations
0
Non-recycled waste
1,514,865
Percentage of non-recycled waste
54.35
(E5-5-37-(a-d))
1) The amount of stored slag from Calvert site is included in Recycling/Stored* row. The amount of slag
stored in 2024 was 962,000 tons.
Composition of waste and waste streams
The main waste streams come from Outokumpu’s ferrochrome business, in terms of mining
waste and waste from ferrochrome production, and from its stainless steel production sites.
(E5-5-38)
The main waste streams at Outokumpu are:
•
tailing sand from chromite mining,
•
steelmaking dust from stainless steel operations,
•
slag, of which only part is classified as waste, as some is classified as by-product,
•
sludge from regeneration or neutralization,
•
oily waste, and
•
scales. (E5-5-38-(a))
Outokumpu’s main waste flows consist of metals and minerals, either as such or as
compounds in sludges. There is also sludge that is contaminated with oil. By weight, the
tailings sand from mining and slag from steelmaking are the main waste category, and in
2024, tailing sand alone was 1,250,608 tonnes. Steel slag is partly categorized as waste
and partly as by-product. The slag categorized as waste can also be utilized. In 2024, our
slag utilization rate was 88.6% – this figure includes slag as waste and slag as a by-
product, and excludes stored slag. (E5-5-38-(b))
Hazardous and radioactive waste
Waste type, tonnes
2024
Hazardous waste
117,266
Radioactive waste
179
(E5-5-39)
Methodologies for data collection
Since Outokumpu’s products are semi-finished and go for further processing, the
information about expected use and durability is based on industry estimations, combined
with factual information about material properties.
The handling and disposal of Outokumpu’s main waste streams is highly dependent on
local regulations. For example, slag classification and use is different in the different
regions in which the company operates. Similarly, the possibility to recycle waste streams is
dependent on availability of further processing. For example, reprocessing and metal
recovery from stainless steel dust is restricted to only a few locations in Europe.
The provided data on waste categories has been compiled following recognized
environmental management and sustainability standards. All Outokumpu sites are ISO
14001 certified, which provides guidelines for monitoring and measuring environmental
performance, including sustainable waste management practices. Additionally, Outokumpu
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follows the GRI 306: Waste 2020 standard, which provides a structured framework for
effective waste management.
Outokumpu follows the Waste Hierarchy for categorizing waste, using the definitions for
“preparing for reuse”, “recycling”, “other recovery operations”, and “disposal” as outlined
in the Waste Hierarchy. Under "non-recycled" waste in the table above, the value is
calculated by taking the total generated waste and excluding only the recycled waste.
Additionally, “prevention”, the first step in the waste hierarchy, is a critical focus for
Outokumpu. The company emphasizes the importance of waste reduction in its
Sustainability Policy.
Waste is weighed, with wet waste like sludges being reported based on its dry weight. In
cases where the waste was not weighed, estimates are made using reasonable
assumptions and historical data. Non-hazardous wastes include tailing sand, scales, and
slag. Tailing sand is sent to landfill, while scales are diverted from landfill, that is to be
recycled with metals being retrieved. Slag can either be recycled, where metals are
retrieved, or partially land filled. While some slag at Calvert site is recycled, part of it is
stored. Since there is no specific category for “stored waste”, the stored slag at Calvert site
is included in “Recycling/Stored1)” row in the “non-hazardous” waste category, as it will
eventually be recycled. For the Tornio site, the slag is categorized as a by-product.
Hazardous waste includes steelmaking dust, oily sludge, regeneration sludge and
neutralization sludge. Steelmaking dust is mainly diverted from landfill, meaning that it is
recycled, but a portion of steelmaking dust is also sent to landfill. Oily sludge is partially
diverted from landfill and recovered for energy purposes, and partially landfilled.
Regeneration sludge is landfilled. Neutralization sludge is mainly land filled, and a small
amount is diverted from landfill, to be recycled. For offices and service centers, the waste
generated is based on the full-time-equivalent (FTE). (E5-5-40)
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Outokumpu’s work on social responsibility
focuses on its own workforce, workers in
the value chain, and affected communities.
Outokumpu contributes to economic and
social well-being by providing jobs directly
to over 8,000 people and additionally
indirectly through its value chain around
the world, and to the local communities,
through financial contributions.
S1 – Own workforce
111
S2 – Workers in the value chain
128
S3 – Affected communities
138
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S1 – Own workforce
Working conditions and equality as well as non-discrimination related to its own workforce
were identified as material for Outokumpu in its double materiality assessment.
Material impacts, risks and opportunities resulting from
the materiality assessment
S 1.1 Working conditions
Impacts
Positive
Safety practices are of a very high standard. Outokumpu encourages its employees to
take care of their health and supports them with well-being benefits and initiatives.
Flexible working conditions are provided whenever possible. The majority of
Outokumpu's employees are covered by collective bargaining agreements. There are
many ways for employees to make their voices heard and raise possible concerns.
These are actual impacts valid in direct operations.
Negative
A large part of Outokumpu’s workforce is exposed to hazards such as heat, noise,
chemicals, and heavy machinery. Many Outokumpu employees work in shifts. Some
employees may also be exposed to a high workload. These are actual impacts valid in
direct operations.
Risks and
opportunities
Opportunity
Outokumpu’s extensive health and safety measures, stable employment, strong
employee dialogue practices, and investments in training and development are likely
to improve employee satisfaction and performance, enhance loyalty and help attract
talent. These opportunities are valid in direct operations.
Risk
Potential controversies regarding the protection of employee rights could lead to
sanctions, remediation costs, labor unrest, reputational damage, and revenue loss.
Unsafe or otherwise poor working conditions may also lower productivity, decrease
engagement, increase employee turnover and impair Outokumpu’s ability to attract
talent. These risks are valid in direct operations.
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TARGETS
Safety target (annual)
<1.6
Total recordable incident
frequency rate (TRIFR) by the
end of 2024
Diversity target
+100
diverse leaders in leadership
teams by the end of 2025
from the 2022 baseline
Outokumpu employs around 8,500 people
in almost 30 countries. In 2024, focus
areas related to its own workforce were
health and safety as well as diversity,
equity and inclusion.
PROGRESS
Safety performance
1.5
Total recordable incident
frequency rate (TRIFR)
remained at the same record
low level as last year,
positioning the company as
the leader of its industry
+55
diverse leaders in leadership
teams at the end of 2024
Women’s euro
0.996
Pay equity
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S 1.2 Equality and Non-discrimination
Impacts
Positive
Outokumpu has set clear targets and action plans to promote diversity, equity and
inclusion. The company is Fair Pay Workplace certified and its recruitment process is
designed to mitigate potential bias. These are potential impacts valid in direct
operations.
Negative
Outokumpu has a male dominated workforce, which is typical of heavy industry, and
as always with one dominant genre in the workforce, topics such as diversity, equity,
and inclusion need special attention. Significantly different working conditions in
Outokumpu’s production facilities versus its offices might endanger equal access to
tools and communication. These are potential impacts valid in direct operations.
Risks and
opportunities
Opportunity
Outokumpu’s commitment to diversity, equity and inclusion may increase its
reputation among clients, investors and future talents. By creating opportunities for
all, Outokumpu can access a wider range of talents and create a more diverse and
inclusive workforce, which may increase productivity and foster innovation. These
opportunities are valid in direct operations.
Risk
Constant vigilance is required to ensure a work environment entirely free of
harassment and discrimination. Outokumpu may also be subject to the same
unconscious biases and inequalities as society at large. Potential discrimination or
harassment cases can lead to lower performance, fines, reputational damage, and
challenges in attracting talent. These risks are valid in direct operations.
(ESRS 2-SMB 3-48-(a))
Strategy
Material impacts, risks and opportunities related to
own workforce and their interaction with the
strategy and business model
Interaction with the strategy and business model
Most of the impacts related to Outokumpu’s own workforce arise from the nature of
Outokumpu’s key activity, stainless steel production. Outokumpu runs industrial operations
in which a significant part of its workforce is exposed to hazards such as heat, noise,
chemicals, and heavy machinery. The workforce in this type of industry is traditionally male
dominated, which may constitute a challenge for diversity, equity and inclusion. (S1-ESRS 2
SBM-3-13-(a)-(i))
In turn, the identified impacts contribute to shaping Outokumpu’s strategy and business
model. For example, safety is a number one strategic priority, a license for the company to
operate, and it is ensured with clear targets and actions. (S1-ESRS 2 SBM-3-13-(a)-(ii)))
Risks and opportunities related to own workforce are intrinsically linked to impacts as well
as connected to Outokumpu’s business model. Mitigating the potential and actual adverse
effects on the workforce of a heavy industry context can also help the company to avoid
financial risks arising for example from hazards or productivity loss, and pursue financial
opportunities linked to competitive advantage and an engaged and innovative workforce.
(S1-ESRS 2 SBM-3-13-(b))
Types of employees and non-employees
The company’s own workforce considered here includes both Outokumpu’s own employees
and non-employees directly working in Outokumpu’s operations, such as sub-contractors for
security, maintenance, or facility services, as well as agency workers replacing personnel in
production on a temporary basis, and self-employed workers. (S1-ESRS 2 SBM-3-14-(a))
Material negative impacts
In the double materiality assessment, actual and potential impacts have been identified
regarding, for example, health and safety, high workload, harassment or discrimination.
Such impacts can have serious consequences that, in many cases, are very severe or long-
term. Actual negative impacts are mostly concentrated on a few people, and not
systematic. The scale of negative impact is medium and can be remediated, in most cases,
with effort, such as time and cost. (S1-ESRS 2 SBM-3-14-(b))
Material positive impacts
Outokumpu has also identified potential positive impacts related to encouraging well-being,
strong collective bargaining and employee listening practices, promoting equal
opportunities and providing training and skills development. The fulfillment of the diversity,
equity and inclusion targets towards 2025 will have a positive impact on a concentrated
group of stakeholders. Positive impacts that Outokumpu can have on its own workforce,
which go above the effort of adhering to laws and regulations, are limited in their scale.
(S1-ESRS 2 SBM-3-14-(c))
Risks and opportunities
Identified risks include reputational damage, litigation costs, low attractiveness as an
employer, and decreased productivity. These may result from poor working conditions,
health and safety issues, discrimination and harassment, lack of training and development,
or data privacy breaches, to name a few. While the risks are high, they are also assessed to
be rather unlikely.
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Opportunities relate to increased productivity, attractiveness as an employer, employee
engagement and loyalty. Good working conditions, health and safety prevention, active
promotion of diversity, equity and inclusion, and investment in training and skills
development, all contribute to seizing these opportunities. (S1-ESRS 2 SBM-3-14-(d))
Material impacts related to the transition plan
Outokumpu has in place its transition plan for climate change mitigation. Climate change is
both an opportunity and a transition risk for Outokumpu. Outokumpu does not consider its
transition plan to have material impacts on its workers, provided that the company reaches
its climate targets. (S1-ESRS 2 SBM-3-14-(e))
Risks related to forced labor and child labor
Risks related to forced labor and compulsory labor were not identified as material in the
double materiality assessment. Outokumpu’s own operations are not considered at
significant risk of incidents of forced or compulsory labor, nor does Outokumpu operate in
countries or geographical areas at such significant risk. (S1-ESRS 2 SBM-3-14-(f))
Neither were risks related to child labor considered material in the analysis. Outokumpu
operates mainly in Europe and the Americas. Europe and the US are free from child labor.
In Mexico, where the risk of child labor is higher, Outokumpu operates under strict ways of
working when recruiting employees and non-employees to its workforce and can thereby
ensure an environment free of child labor. (S1-ESRS 2 SBM-3-14-(g))
Understanding potential greater risks
To understand how some groups of workers may be at greater risk of harm, Outokumpu
conducted a thorough survey in 2022 on diversity, equity and inclusion, which among other
things provided insights into the perception of employees with disabilities or those
belonging to a minority. ResponsibleSteel audits that covered Outokumpu’s European
operations in 2023 also helped form a solid view of the risks posed to people with
particular characteristics or working in special context. Outokumpu’s human rights risk and
impact assessment for its own operations was conducted for the first time in 2021 followed
by a more thorough update in 2024. The findings of this updated assessment support the
other mappings of potential greater risks and defining further actions to prevent and
mitigate these identified risks. (S1-ESRS 2 SBM-3-15)
Risks and opportunities related to specific groups
Through these surveys, audits and assessments, Outokumpu has not identified significant
risks or opportunities related to specific groups of people. The most salient difference
within the workforce is between people working in an office environment and those working
in production facilities, who are more exposed to safety-related risks. Safety practices and
culture are however so strong in Outokumpu that these risks have been reduced to a
minimum. (S1-ESRS 2 SBM-3-16)
Impact, risk and opportunity
management
Policies
Policies related to own workforce
The key policies related to Outokumpu’s own workforce are the Sustainability Policy, Code
of Conduct, Human Rights Policy, Health and Safety Policy and Recruitment Policy. These
policies cover all of Outokumpu’s workforce. In addition, Outokumpu has many policies and
regulations on a local level, on topics such as working time, remote working, leaves of
absence, work environment and safety, equal treatment, and training and development.
(S1-1-19, S1-MDR-P-65-(b))
Key contents of the policies
The Outokumpu Sustainability Policy states the company’s commitment to diversity, equity
and inclusion, a work environment that allows all team members to contribute and to
develop, human rights and dignity, a safe and healthy workplace, and employee
development.
The Outokumpu Code of Conduct provides the principles and rules that all employees at
Outokumpu need to follow in their daily work, and it ensures that all Outokumpu employees
live up to the Ethical Principles, Ways of Working and highest standards of integrity by
setting examples and giving practical advice.
The Human Rights Policy describes the main principles and rules followed by Outokumpu
Group in relation to respecting and protecting human rights.
The Health and Safety Policy describes the main principles and rules followed by
Outokumpu in relation to occupational health and safety management. Health and safety
are integral parts of Outokumpu operations and decision-making, with a central role in
Outokumpu’s vision, strategies, and planning.
The Recruitment Policy outlines key principles that apply to recruitment at Outokumpu,
such as transparency, equitable opportunity, and one-over-one approval. It mandates the
usage of interview panels aligned with the demographics of the organization, and states the
goal of 50% diversity on all candidate short-lists. (S1-MDR-P-65-(a))
Scope, accountability, stakeholders, availability,
and third-party standards
More information about the approval process, stakeholders and availability, and coverage
of the policies as well as third-party standards is available in the following sections:
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regarding the Sustainability Policy in the Climate change chapter (E1), Code of Conduct in
the Governance chapter (G1) and the Human Rights Policy in Affected communities (S3).
The Recruitment Policy applies to all of Outokumpu’s workforce. The Executive Vice
President, Strategy, Sustainability and People is accountable for the implementation of the
policy. While it does not directly reflect any specific third-party standard, it is set to
safeguard the interests of Outokumpu’s workforce, notably in terms of equality and non-
discrimination. The policy is available to all Outokumpu employees on the company’s
intranet. (S1-MDR-P-65-(b)-(f))
Human Rights Policy commitments relevant for own workforce
Outokumpu has a Human Rights Policy that describes the main principles and rules
followed by Outokumpu in relation to respecting and protecting human rights. The policy
must be followed globally by all Outokumpu businesses, companies, directors, officers, and
employees. The company is also a member of ResponsibleSteel.
More information about the Human Rights Policy commitments relevant to the company’s
own workforce is available in the Affected communities (S3) chapter, in the Policy section,
under "Key contents of the policy”. (S1-1-20)
Human Rights Policy commitments related to own workforce
The Human Rights Policy states that the company:
•
respects and promotes human rights,
•
expects all its business partners to respect and promote human rights,
•
has specific human rights principles addressing its most salient human rights issues;
•
conducts human rights due diligence as part of its decision-making processes by
identifying, preventing, mitigating, and accounting for potential and actual adverse
human rights impacts,
•
maintains a grievance mechanism for employees and external stakeholders, and
•
is committed to the UNGPs and its human rights due diligence and grievance
mechanism is in line with the expectations of the UNGPs. (S1-1-20-(a))
Outokumpu also cooperates with, informs and consults its employees and their
representatives. The Outokumpu Personnel Forum is an important information channel
between its personnel and management in European operations, based on the European
Works Council Directive. More information is available below in this chapter in “Engaging
with own workforce” (S1-2). (S1-1-20-(b))
Remedy for human rights impact
Measures to provide or enable remedy for human rights impacts are being developed as
part of Outokumpu’s sustainability due diligence process as defined in the action plan for
2025. The scope covers both Outokumpu’s own operations and value chain, including own
workforce, value chain workers and affected communities that might be in the need of
remedial actions. (S1-1-20-(c))
Alignment with internationally recognized instruments
In accordance with the United Nations Guiding Principles on Business and Human Rights
(UNGPs), Outokumpu commits to respecting human rights and undertaking human rights
due diligence as part of its corporate decision-making process.
According to Outokumpu’s Human Rights Policy, the company complies with all national
laws and respects international human rights principles, including the United Nations
Universal Declaration of Human Rights, the International Covenant on Civil and Political
Rights, the International Covenant on Economic, Social and Cultural Rights, the European
Convention on Human Rights, and the International Labor Organization’s Declaration on
Fundamental Principles and Rights at Work. In addition to the UNGPs, Outokumpu is
committed to the OECD Guidelines for Multinational Enterprises and to the UN Global
Compact as a signatory. The company also refers to the Indigenous and Tribal Peoples
Convention, 1989 (No. 169) and the UN’s Declaration on the Rights of Indigenous Peoples
regarding its approach to indigenous people’s rights.
Besides the Human Rights Policy, aspects related to human rights are covered in the Code
of Conduct, Sustainability Policy and Supplier Code of Conduct. (S1-1-21)
As stated in the Human Rights Policy, Outokumpu does not accept the use of forced labor,
bonded labor, slavery, nor any form of modern slavery within Outokumpu or in its supply
chain, nor does the company tolerate or accept any form of human trafficking. (S1-1-22)
Workplace accident prevention policy
The Health and Safety Policy describes the main principles and rules followed by
Outokumpu Group in relation to occupational health and safety management. Outokumpu is
aiming for health and safety excellence with implemented, standardized and disciplined
health and safety management practices and ambitious objectives. Outokumpu’s goal is to
prevent all workplace injuries and occupational ill health by eliminating and minimizing
health and safety risks, raising awareness and developing a positive culture. (S1-1-23)
Policies eliminating discrimination
Outokumpu’s Code of Conduct, Human Rights Policy and Recruitment Policy all play a part
in eliminating discrimination and advancing diversity, equity and inclusion. (S1-1-24-(a))
Outokumpu's Code of Conduct specifically mentions various grounds for discrimination,
including racial and ethnic origin, color, sex, sexual orientation, gender identity, disability,
age, religion, political opinion, and more, adhering to both European Union regulations and
national laws. (S1-1-24-(b)) Outokumpu does not tolerate discrimination, intimidation nor
verbal, psychological, physical, or sexual harassment, nor abuse at work, such as
humiliating or physical punishment. (S1-1-24-(c))
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Outokumpu’s policies against discrimination and for diversity and inclusion are
implemented via a combination of well-functioning ways to gain insights into the
perspectives of its people, such as formal and informal engagement practices, people pulse
surveys and a SpeakUp channel, for which more information in the Processes section below
in this chapter (S1-2), as well as targeted diversity, equity and inclusion related actions,
including regular pay equity monitoring and team dialogue trainings in its operations. More
information is available in the Actions and resources section below in this chapter (S1-4).
(S1-1-24-(d))
Processes
Processes for engaging with own workforce and
workers’ representatives about impacts
Outokumpu engages with its workforce both directly and through workers’ representatives,
to gain perspectives and inform its decisions and activities aimed at managing actual and
potential impacts. Outokumpu’s own workforce is involved in determining which targets to
sets and which actions to drive, as well as in evaluating the progress against the targets
and the outcomes of actions. (S1-2-27)
As workers’ representation largely depends on the location, the table provides an overview
of the type of representation in place in Outokumpu’s main countries of operation.
Type of representation in main countries of operation
Country
Coverage
Workers’ representation and collective bargaining
Finland
U
All employees are covered by employee representatives and collective
agreements: Teollisuusliitto (blue-collar employees), Pro (salaried employees),
YTN (senior salaried employees).
Sweden
U
All employees are covered by employee representatives and collective
agreements: “Tjänstemannaavtalet” (white-collar employees) and “Röda
Avtalet” (blue-collars)
Germany
U
Tariff and non-tariff employees are represented by a works council and covered
by collective agreements. Executives are represented by a speakers’
committee and covered by company specific agreements.
UK
R
Employees are represented by the Employee Forum.
Netherlands
U
All employees are represented by a works council and included in collective
agreements: CAO Metalelektro and CAO Metalelektro hoger personeel.
Lithuania
R
Employees are represented by a works council with an advisory function.
Italy
U
All employees are covered by employee representatives and collective
agreements: “Metal Industry” (CCNL Aziende Industria metalmeccanica e della
installazione di impianti) and “Dirigenti Industry”.
Poland
R
Employees are represented by a works council, which must be consulted about
certain topics and informed about the economic situation of the employer.
USA
N
No unions nor formal employee representation are in place but employees can
join regional Team Member Networking Groups (TNG) and reach out directly to
any of the executive management via a link on the intranet, to ask a question
or make a suggestion. All employee relations matters are handled through
direct communication and collaboration between management and
employees.
Mexico
U / N
All blue-collar workers are unionized. Every department in the plant has a union
representative to support employees’ needs. White collar employees are not
part of a union or subject to a collective bargaining agreement. Employees
can reach out to any of the executive management directly, as in the US.
Women may also join the Female TNG group. All employee relations matters
for white-collar employees are handled through direct communication and
collaboration between management and employees.
U = Collective agreement(s) and union(s) in place.
R = Organized employee representation in place.
N = No union nor organized employee representation in place.
Besides local representation, Outokumpu also operates a European Works Council which is
kept informed and consulted on group-wide and cross-border topics. (S1-2-27-(a))
Direct engagement includes regular, structured communication with employees at all levels.
For example, employees are encouraged to give their views in direct discussions with their
manager, but also by contacting HR or management when needed. Regular people pulse
surveys provide another opportunity for feedback as do town hall meetings at many levels
of the organization, from the quarterly result reviews with the CEO to all-hands meetings in
different sites.
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More formal engagement with workers’ representatives takes place locally from every week
to every quarter, depending on the site and the employee group concerned, but also
whenever there is a need to inform, consult or co-determine on specific topics. The topics
that call for some type of engagement depend on local agreements and regulations, but
typical subjects relate to workplace organization, safety and working conditions,
remuneration, employment protection and social plans. In some countries, there are
separate representatives for health and safety matters.
On the European level, the Group Working Committee (GWC) meets on a quarterly basis
and the Outokumpu Personnel Forum (OPF) once a year. (S1-2-27-(b))
The person responsible for human resources (HR) in the context where the engagement
takes place normally bears the operational responsibility for facilitating that engagement.
For example, in Germany the labor director accounts for the engagement in Germany, and
in Sweden it is the Head of HR who has this responsibility. The Executive Vice President –
Sustainability, Strategy and People heads the European Works Council. On some sites, the
managing director takes the lead in ensuring that the engagement happens, usually
together with the HR Business Partner. (S1-2-27-(c))
Although labor rights are considered in the different collective bargaining agreements and
emphasized in Outokumpu’s Code of Conduct and policies, there is no global agreement
with workers’ representatives specifically related to the respect of human rights of the
workforce. (S1-2-27-(d))
The effectiveness of the engagement is regularly assessed as part of the discussions
between the company and employee representatives, according to procedures described in
the different local agreements in place. (S1-2-27-(e))
To gain insights into the perspectives of people who may be particularly vulnerable or
marginalized, Outokumpu regularly inquires about inclusion and equity via group-wide pulse
surveys. The results of the surveys are analyzed and discussed at many levels, from group
to departments to teams, whenever confidentiality allows, and actions are taken.
Employees are encouraged to raise any issue by contacting their manager, manager’s
manager, company management, HR, compliance, internal audit, via physical mailboxes or
the SpeakUp channel. HR also closely follows absences and other signs of potential ill-
being to offer prompt support when needed. More information on these processes is in the
next section below, in this chapter.
In the Americas, Team Member Networking groups offer a safe place and a representation
opportunity for certain minority groups. (S1-2-28)
Processes to remediate negative impacts and
channels for own workforce to raise concerns
Remedy
Outokumpu is currently further developing a sustainability due diligence process to cover
both own operations and value chain, including Outokumpu’s own workforce, value chain
workers and affected communities. A gap-analysis and a related action plan to develop the
due diligence process further were completed in 2024. Outokumpu does not currently have
a general group-level approach to providing or contributing to remedy. Developing a general
approach and establishing a related process for providing, enabling, and also assessing the
effectiveness of remedy, will be part of this action plan for 2025. Currently, these
situations are managed on a case-level based on the UNGPs and OECD guidelines and
consulting external experts, when needed. (S1-3-32-(a))
Grievance mechanisms
Outokumpu has a whistleblowing channel called SpeakUp in place, hosted by a third party,
through which concerns can be raised in a confidential manner. It allows the company’s
own workforce, workers in the value chain, affected communities, and other external
stakeholders, to report their concerns confidentially and also anonymously, if allowed by
the local laws and regulations. SpeakUp channel is available in several languages and a
link to the channel can be found on intranet and on Outokumpu's external website. More
information about reporting misconduct can be found in the Governance section. S1-3-32-(b))
Outokumpu has, based on the ResponsibleSteel audits for Outokumpu’s European
operations and the sustainability due diligence process for its own operations and value
chain, identified the need to develop its approach to providing various types of grievance
mechanisms to its own workforce, value chain workers and affected communities which will
be developed as part of the sustainability due diligence action plan for 2025.(S1-3-32-(c))
Outokumpu actively promotes awareness of the SpeakUp channel among its own workforce
through regular internal communications, training sessions, and introduction programs for
new employees. (S1-3-32-(d))
The issues that are raised via the company’s whistleblowing channel SpeakUp are handled
according to Outokumpu’s internal procedure, to ensure proper and independent
investigation. Monitoring possible remedial actions are included in this procedure. The
effectiveness of the SpeakUp channel is not being evaluated based on the criteria set for
grievance mechanisms by UNGPs or OECD guidelines at the moment. However, this is also
under work as part of the sustainability due diligence action plan. (S1-3-32-(e))
Outokumpu has a strict non-retaliation policy for reports made in good faith. This means
that the person who reports an issue shall not face negative consequences if the reporter
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has reported their concerns in good faith. Furthermore, if the misconduct report is within
the scope of the EU Whistleblower Protection Directive (EU) 2019/1937 and the
consequent local laws and regulations, they also receive protection based on these laws
and regulations. Outokumpu’s policies and practices are regularly reviewed and updated to
ensure that they also account for more recent developments. Business conduct topics and
how employees perceive the various elements of the company’s actions, operations and
corporate culture are also regularly evaluated and measured through various means, such
as through employee engagement surveys targeted at all employees. During 2024, there
were two (2) employee engagement surveys conducted. These surveys included questions
around the key themes of the corporate culture – ethical behavior, health and safety,
diversity, equity, and inclusion as well as reporting concerns. On the latter it was asked if
Outokumpu’s own workforce is aware of the ways and channels of how to report possible
concerns at Outokumpu and if they fear possible negative consequences of doing so.
(S1-3-33)
Evaluating the need to develop procedures to assess that Outokumpu’s own workforce is
aware of and trusts structures and processes as way to raise their concerns or needs, and
to have them addressed, will also be part of the action plan to develop further the
sustainability due diligence process in 2025 and onwards. (S1-3-34)
Actions and resources
Actions on material impacts on own workforce
Key actions
The work with Outokumpu’s own workforce focuses on the following topics: work on safety,
health and well-being, learning and development, and diversity, equity and inclusion. Key
actions include the actions taken in 2024 as well as other ongoing and future actions.
Safety
Outokumpu takes proactive actions regarding its safety management system, including
hazard recognition, safety behavior observations and preventive safety actions, to flag
potential risks and unsafe acts and behaviors before they lead to an accident. Outokumpu
also continuously trains its employees to behave safely, for example through customized
trainings.
In 2024, Outokumpu continued to test state-of-the-art technology for safety and utilized AI-
driven robots in Finland to automate some parts of the safety inspection work and reduce
the exposure of employees to hazardous areas. The work on utilizing AI will continue in
2025.
Health and well-being
During 2024, Outokumpu worked on enhancing its strategy regarding mental health. An
expected outcome by prioritizing the well-being of its employees, is that Outokumpu gains a
competitive advantage by creating a more resilient, healthier, and more productive
workforce. The work will continue in 2025. Outokumpu encourages its employees to take
care of their physical health by offering various exercise benefits and discounts to sports
and well-being services, and health support programs on-site.
Learning and development
During the reporting year, the focus was on leaders as leadership forms the firm foundation
for a high-performing organization. Firstly, 360° assessments for Outokumpu leaders were
started during 2024, to support their self-awareness and development. Secondly, emphasis
was also put on leadership pipeline training for all leaders to develop their leadership skills.
During 2024, 3,400 hours of leadership training was delivered across the company. In
addition, HR-facilitated “Team Excellence” training was offered for leaders and their teams
who want to learn to function as a cohesive unit. During 2024, 52 Team Excellence
sessions were delivered. The work on leader training and capacity building continues in
2025.
Outokumpu supports professional development and growth by building capabilities across
the company, which is expected to meet the business needs and requirements for the
future. A total of 70,913 training hours were delivered during 2024, across all of
Outokumpu’s locations. The average employee spent 8.1 hours in training during the year.
The top learning categories involving the majority of Outokumpu’s employees included
safety, compliance, leadership, and inclusion. The work is ongoing.
Diversity, equity and inclusion
Outokumpu continuously promotes diversity and equity by standardized recruitment and
promotion practices to mitigate potential biases. To strengthen an inclusive working
culture, Outokumpu created a team dialogue training, which was launched in 2023 and
rolled out to all employees in local operations also in 2024. By the end of the year, 86% of
all blue collar employees had gone through the team dialogue training – which was
delivered as a discussion based game in small groups, all facilitated by their manager and/
or HR. In 2024, pay transparency was improved for all employees by sharing access on
their job grade and comparative ratio. The comparative ratio shows where an employee’s
salary stands in comparison to the pay scale for the position and location. Increasing
transparency supports the pay equity agenda. In early 2024, Outokumpu received the Fair
Pay Workplace certification, which is maintained through regular monitoring and action plan
follow up with an external partner. With these key actions, Outokumpu expects to avoid the
potential negative impacts of operating in a traditionally male dominated industry, mitigate
the related risks, and promote the positive impact and seize the opportunities linked to
providing a diverse, fair and inclusive environment to its own workforce. (S1-MDR-A-68-(a))
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Scope
Safety
Safety actions take place globally throughout Outokumpu, with extra emphasize in
production sites and service centers. They include both employees and non-employees in
the workforce.
Health and well-being, learning and development, diversity, equity and inclusion
While the actions described above take place throughout Outokumpu, some of them are
targeted at a specific part of the workforce, such as leaders when it comes to leadership
training or operators and technicians when it comes to team dialogue training. They
normally do not include non-employees in the workforce. (S1-MDR-A-68-(b))
Time horizon
Safety
The actions are part of a comprehensive safety management system which is not limited in
time but is operated on a continuous basis and enhanced year after year.
Health and well-being. learning and development, diversity, equity and inclusion
The actions are part of a comprehensive human resources management framework which is
not limited in time but is operated on a continuous basis and enhanced year after year.
(S1-MDR-A-68-(c))
Prior progress
Safety
From 2022 to 2023, the total recordable incident frequency rate (TRIFR) fell by 17%. This
was achieved with strong safety management, strengthened safety culture, and the usage
of state-of-the art technology such as robots, among other things.
Health and well-being. learning and development, diversity, equity and inclusion
In 2023, Outokumpu’s engagement index was 77, being +3 points against the external
benchmark provided by the survey provider. Over 300 leaders participated in Outokumpu’s
leadership programs. The number of diverse leaders increased by 57, against a target of
+40. A 60% agreement score was reached in all areas of inclusion. In adjusted terms,
women earned EUR 0.986 for every EUR 1 earned by men. (S1-MDR-A-68-(e))
Preventing, mitigating or remediating material negative impacts
Outokumpu is taking action to prevent negative outcomes related to the safety hazards its
workforce is exposed to. During 2024, the company for example analyzed every incident’s
root cause and when relevant, shared the results group-wide to ensure that preventive
actions across the company were taken. Analysis was also done at group level and
embedded in the company’s annual planning, for example, regarding hand safety. Already
before 2024, it was ensured that all sites have first aiders in place and the company has
escalated routines to ensure that employees and contractors have the chance to get to
hospital by ambulance as quickly as possible in the case of a safety hazard. These
preventative actions will continue to be taken in 2025 and onwards. In 2025, the company
is also planning to focus on learning from near-misses. (S1-4-38-(a))
In 2024, there were 181 work related incidents reported leading to injuries. Out of the 181
incidents, there were 31 recordables reported including the classification as fatality, lost
time injury, restricted work injury or medical treated injury. In each case, Outokumpu has
supported with the provision of a remedy in the form of first aid, medical treatment,
rehabilitation and time off work. (S1-4-38-(b), S1-MDR-A-68-(d))
Outokumpu makes thousands of safety behavior observations (SBOs) each year, carefully
reports all hazards, and thoroughly investigates every safety incident. These observations,
reports and investigations inform action-taking, from very local and specific levels (for
example, changing one specific procedure on one production line) to group level (for
example, theme discussions and communication campaigns on a specific type of hazard).
(S1-4-39)
In 2024, Outokumpu has not taken any measure to mitigate impacts on workers that arise
from the transition to a greener economy, since the impact from this transition is positive
for Outokumpu’s workforce. The company continuously trains and develops its workforce on
green technologies when moving forward in its climate strategy. (S1-4-AR-43)
Delivering positive impacts
Outokumpu is taking action to deliver positive impacts to its workforce in terms of health
and well-being, learning and development, and diversity, equity and inclusion, as described
above in the paragraph on key actions. (S1-4-38-(c))
Tracking actions’ effectiveness
The effectiveness of actions and initiatives is continuously tracked and assessed through a
variety of metrics, such as people pulse surveys and health and safety records. Outokumpu
also holds regular review meetings and solicits feedback from its workforce, including
discussions with workers’ representatives, to ensure that its actions are yielding the
desired outcomes.
A good example of this tracking is the feedback Outokumpu receives from its employees
through regular people pulse surveys. The surveys are conducted with an external partner,
Viva Glint, to ensure confidentiality. In 2024, the Outokumpu engagement index remained
at an excellent level compared to the external benchmarks being at 76 on a scale of 1–
100. The response rates are at a good level and provide us with representative and reliable
results. The engagement index consists of two questions that are the main drivers for
engagement: “How happy are you at Outokumpu?” and “Would you recommend Outokumpu
as a great place to work?”.
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In 2024, people pulses have included topics such as safety behavior, mental health,
rewards, fair and respectful treatment, career and development opportunities,
empowerment, and manager satisfaction. After each pulse survey is completed all
managers are responsible for making the results transparent to their employees and
implementing appropriate improvement initiatives.
More information is available in the Metrics and targets section below in this chapter.
(S1-4-38-(d))
Actions related to risks and opportunities
Actions to mitigate material risks related to own workforce are the same as the actions
aiming at preventing, mitigating or remediating material negative impacts, as described
earlier in this section. (S1-4-40-(a))
Actions to pursue material opportunities related to own workforce are the same as the
actions aiming at delivering positive impacts, as described earlier in this section. (S1-4-40-(b))
Avoiding negative impacts
Outokumpu ensures through its policies and targets that the company’s own practices do
not cause or contribute to material negative impacts on its own workforce.
To begin with, Outokumpu has a safety-first approach to all its activities. The company
believes that strong safety performance correlates with improved quality and operational
efficiency. Good health and well-being of the personnel are essential values on their own. In
addition, a healthy and thriving team of professionals is an asset to the company’s
success, and all employees should return home healthy, safe and sound every day.
Outokumpu strives consciously toward a company culture where all decisions and activities
result from the following safety principles:
•
Safety before volume: safety takes priority over all other activities, including production.
•
Safety starts with me: everyone is responsible for their own safety and for caring for the
safety of their colleagues.
•
No shortcuts: procedures are followed and risks evaluated before acting.
•
No repeats: all incidents are investigated and actions taken to prevent re-occurrence,
anywhere. (S1-4-41)
In addition, Outokumpu’s commitment to data security is guided by the company’s security
policy and information and cyber security principles based on industry-accepted standards
and frameworks. To protect the data on its own workforce, Outokumpu requires suppliers to
align with the company’s data protection guidelines. This includes mandatory GDPR training
for their staff, secure data handling practices, robust backup and recovery procedures, and
encryption to protect data at rest and in transit. Suppliers must also implement strict
access controls, secure their networks with measures such as firewalls and intrusion
prevention systems, and have incident response plans to manage security breaches
effectively. These requirements ensure Outokumpu’s data on its own workforce is handled
and stored in a secure manner. (S1-4-41)
Resource allocation to manage material impacts
Outokumpu allocates significant resources, both financial and non-financial, to managing
material impacts on its workforce. Financial resources include investments in safety
equipment, health and safety initiatives, and training programs, as well as the technology
and people to manage these. Non-financial resources include for example allocating time
and expertise for developing policies and processes, employee engagement and leadership
development. (S1-4-43, S1-MDR-A-69-(a))
In 2024, about 100 experts worked in health and safety teams, and over 130 in HR. There
were also more than 20 people working on compliance, internal audit, and employee
representation activities. Additionally, Outokumpu invested EUR 14 million related to health
and safety OPEX and CAPEX projects. Besides project related investments, Outokumpu also
spent EUR 0.5 million in licenses for learning and development tools supporting both health
and safety as well as diversity, equity and inclusion. (S1-MDR-A-69-(b))
Outokumpu regularly reviews its resource allocation and adjusts it when needed to meet
business needs and the expectations of its own workforce, so that the company is
effectively managing its material impacts at all times. In 2025, the financial resources
allocated to managing material impacts related to the company’s own workforce is
expected to remain at a similar level as in 2024. (S1-MDR-A-69-(c))
Metrics and targets
Targets related to own workforce
Outokumpu uses outcome-oriented targets in two focus areas to drive and measure
progress in addressing material impacts, risks and opportunities related to its own
workforce: safety as well as diversity, equity and inclusion (DEI). Each individual target
described below serves multiple purposes related to the workforce: reducing negative
impacts (S1-5-44-(a)), advancing positive impacts (S1-5-44-(b)) and managing material risks
and opportunities (S1-5-44-(c)).
Relationship with policy objectives
Safety
The ultimate goal for Outokumpu is to have zero accidents, with an underlying management
philosophy to continuously improve our safety practices. To strive towards that, Outokumpu
sets total recordable incident frequency rate (TRIFR) targets yearly.
Outokumpu Annual Report 2024
119
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Diversity, equity and inclusion
In 2022, Outokumpu’s Board of Directors defined a set of diversity, equity and inclusion
targets for 2025. These targets support the implementation of the company’s
Sustainability Policy, Code of Conduct, Human Rights Policy, and Recruitment Policy when it
comes to building a work environment where everyone, regardless of their particularities
and differences, is treated fairly and has the opportunity to contribute and to develop. (S1-
MDR-T-80-(a))
Measurable target
Safety
In 2024, the target was to keep a world-class TRIFR level of 1.6, while evening out the solid
performance throughout its operations. This target is included for 10% weight in the short-
term incentive plan applicable to the management, including the CEO.
Diversity, equity and inclusion
Diversity targets are to increase diversity in leadership by adding 100 diverse leaders
compared to the baseline of July 2022 and to ensure that all international management
teams include a minimum of 30% of diverse leaders, by the end of 2025.
For equity, the target was to obtain external certification on compensation fairness, and for
inclusion, to reach a 60% agreement score in the people pulse survey, on all questions
related to inclusion and across all diverse employee groups. (S1-MDR-T-80-(b))
Scope
Safety
While this target is set at a group level, it is turned into to site level targets, which are
included in local incentive plans.
Diversity, equity and inclusion
These targets are defined at group level. (S1-MDR-T-80-(c))
Baseline year
Safety
Outokumpu aims to be the industry leader in safety, with a vision of zero accidents. Since
2016, it has reduced the total recordable incident frequency rates (TRIFR) in relation to
one million working hours, meaning work-related incidents, by 83%, from 8.7 to 1.5 in
2024.
Diversity, equity and inclusion
In diversity targets, the baseline for adding 100 diverse leaders is July 2022. In the target
of a minimum of 30% diverse leaders in the international management teams, there is no
baseline set.
In equity, the target to reach equal pay was set in 2022, and in inclusion the target is to
maintain the baseline set by the diversity, equity and inclusion survey conducted in 2022.
(S1-MDR-T-80-(d))
Milestones
Safety
These targets are set yearly, but closely followed on a monthly basis.
Diversity, equity and inclusion
For the target of adding 100 diverse leaders by 2025, interim targets are defined for the
end of each calendar year and included in the short-term incentive plan applicable to the
management for 10% weight. Other target levels are intended to be maintained each year.
(S1-MDR-T-80-(e))
Methodologies and assumptions
Safety
To define appropriate target levels, the health and safety department analyzes the trends in
safety data across sites in the light of industry benchmarks, and it makes a proposal to the
management. At group and business area levels, the targets are approved by the Board of
Directors.
Diversity, equity and inclusion
At Outokumpu, a diverse leader is defined as a manager, meaning an employee with a
minimum of one direct report, who is female and/or belongs to an ethnic minority and/or
whose nationality differs from their working country. (S1-MDR-T-80-(f))
Process for target setting
Safety
Outokumpu’s employees are involved in this target setting process via the voice of their
health and safety representatives as well as their workers’ representatives.
Diversity, equity and inclusion
While employee representatives were not directly involved in setting these targets, the
perspectives of employees obtained in the diversity, equity and inclusion survey conducted
in 2022 was a key input. (S1-MDR-T-80-(h), S1-5-47-(a))
Changes in metrics and targets
In 2024, there was no change in the target principle, metrics and underlying methodology
that would impact comparability. (S1-MDR-T-80-(i))
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Performance against disclosed target
Safety
In 2024, Outokumpu achieved a TRIFR of 1.5. Performance has confirmed the record low
level from previous year, positioning Outokumpu as a leader in the industry sector.
Diversity, equity and inclusion
By the end of 2024, altogether 55 diverse leaders had been added to the group and 10
management teams out of 12 included 30% or more diverse leaders. The Fair Pay
workplace certification was achieved in March 2024, and Outokumpu started to publicly
disclose both its unadjusted pay gap and adjusted pay gap. At the end of 2024, women in
Outokumpu earned EUR 0.996 for every EUR 1 earned by men (a gap of 0.4%), up from
EUR 0.986 in 2023. These numbers consider the compensation from similar job positions,
qualifications, and experience. Without taking these explanatory factors into account,
women earned EUR 1.09 for EUR 1 earned by men on average. This reflects the structural
differences in gender by type of job: men dominate the workforce at the mills while the
proportion of women is higher in office jobs.
In the company-wide People Pulses 2024, an agreement score of 78 was reached on all
eight (8) questions related to inclusion. The agreement score increased +1 since the
previous year. The most significant increases were experiences in manager-related
questions, such as how the manager cares about the team members as persons and values
their perspectives. This is reflected in the question “I feel like I belong in our team”, where
the agreement score increased +2 since the previous pulse, reaching a result of 82 which
is 3 points higher than the average of all companies surveyed using the tool Viva Glint. (S1-
MDR-T-80-(j))
Process for tracking performance
Safety
A dashboard and a presentation with more underlying data are made available to all
employees on the intranet, and the CEO hosts a monthly call to review the situation and
learn from incidents that may have happened. The progress is also closely followed and
discussed with all employees at site level.
Diversity, equity and inclusion
To track performance against the DEI targets and identify improvement opportunities,
Outokumpu has several tools and practices. Diversity in leadership is monitored via a
dashboard in PowerBI, which is updated quarterly and discussed in management team
meetings. Pay equity is regularly checked by HR thanks to Syndio, a specialized pay equity
platform, and remediation is proposed when necessary as part of the annual salary review
process. Inclusion is followed up through regular pulse surveys in Viva Glint, and discussed
along with possible actions to take at team, department and company levels. All these
systems operate under strict permission authorization and governance, to ensure data
reliability and protection. (S1-5-47-(b))
Process for identifying improvements
Safety
Every incident or near-miss is analyzed and every hazard is reported. Outokumpu has two
safety reporting systems in place, MIA in Europe and Intellex in USA. These systems use
workflows to generate actions to mitigate the reported items. More complex cases are
analyzed using root cause analysis methods and mitigation actions are also tracked in the
reporting system. Learning points and further actions are regularly discussed with employee
representatives, for example in the Group Working Committee.
Diversity, equity and inclusion
Overall progress against the targets, learning points and further action points are regularly
discussed with employee representatives, for example in the Group Working Committee.
(S1-5-47-(c))
Employee characteristics
Employee headcount
As of December 31, 2024, the company had 8,736 employees. The four biggest countries
represent 81% of the entire Outokumpu Group. At year-end 2024, those four countries with
the most employees were, in descending order, Finland, Germany, Sweden and the US.
The tables below present the breakdown of all of Outokumpu’s employees by gender, region
and type of employment contract.
Employee headcount by gender
Gender
Number of employees (headcount)
Female
1,648
Male
7,088
Other
0
Not reported
0
Total employees
8,736
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Employee headcount in countries with at least 50 employees,
representing more than 10% of the total headcount
Country
Number of employees (headcount)
Finland
2,589
Sweden
1,566
Germany
1,926
USA
978
(S1-6-50-(a))
Employees by contract type, broken down by gender (headcount)
2024
FEMALE
MALE
OTHER
NOT DISCLOSED
TOTAL
Number of employees (headcount)
1,648
7,088
8,736
Number of permanent employees (headcount)
1,526
6,801
8,327
Number of temporary employees (headcount)
122
287
409
Number of non-guaranteed hours employees (headcount)
Number of full-time employees (headcount)
1,534
6,137
7,671
Number of part-time employees (headcount)
114
951
1,065
*Gender as specified by the employees themselves. (S1-6-50-(b))
Employees by contract type, broken down by region (headcount)
2024
Europe
America
Asia
Australia
Africa
Total
Number of employees (headcount)
6,899
1,786
45
3
3
8,736
Number of permanent employees (headcount)
6,509
1,769
43
3
3
8,327
Number of temporary employees (headcount)
390
17
2
409
Number of non-guaranteed hours employees (headcount)
Number of full-time employees (headcount)
5,835
1,785
45
3
3
7,671
Number of part-time employees (headcount)
1,064
1
1,065
(S1-6-52)
The information on gender is based on self-reporting. The current split in gender is between
male and female, where the female rate is 19%. During the last three years, there has been
a 3% increase in the female-to-male ratio.
Outokumpu has 1,065 part-time employees and 7,671 full-time employees, bringing the
share of part-time employees to 12.2%. A key explanation is the collectively reduced
working time in operations areas in Germany from contractually 35 hours per week to 33
hours per week, due to difficult market conditions.
Outokumpu had 8,327 permanent employees and 409 temporary employees, 95.3% and
4.7%, respectively. Temporary workers enable the company to react to volatile market
conditions. They are also a valuable talent pool from which to hire full-time employees when
needed. (S1-6-50-(e))
In 2024, a total of 537 employees left Outokumpu, which is a turnover rate of 6.4% based
on 8,327 permanent employees. (S1-6-50-(c))
Outokumpu’s total headcount can be found in the Group key figures in the Financial
Statements. (S1-6-50-(f))
Outokumpu also follows upon its workforce via other metrics, such as absences and
sickness rates. (S1-6-MDR-M-75)
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Methodologies and assumptions
The headcount figures are taken from Outokumpu’s global personnel information system.
All relevant information is stored for each person, and this can be reported in different
ways, for instance by full-time equivalent, employee group, employment status, absence
status, all organizational department levels, legal entity, location, and cost center, to name
just a few.
Outokumpu distinguishes between headcount and full-time equivalent with the following
definitions:
•
Headcount is the number of individuals employed by the company. Every such individual,
even working part-time, counts as 1.
•
A full-time equivalent (FTE) is a unit of measurement used to calculate the number of
full-time hours worked by all employees in a business. If your business considers 40
hours to be a full-time work week, then an employee working 40 hours per week would
have an FTE of 1.0. In contrast, a part-time employee working only 20 hours per week
would have an FTE of 0.5, which shows that their hours worked are equivalent to half of
a full-time employee. Additionally, FTE will be 0 for employees who are on sick leave or
parental leave for more than six months or who are on a notice period without a
requirement to work. (S1-6-50-(d), S1-6-MDR-M-77-(a))
In this report, Outokumpu reports its employees by headcount and as of December 31,
2024. (S1-6-50-(d)-(i), S1-6-50-(d)-(ii))
The key figures related to own workforce are not validated by any external body other than
the assurance provider. (S1-6-MDR-M-77-(b))
Collective bargaining coverage and social dialogue
Outokumpu maintains a consistent policy of freedom of association. All Outokumpu’s
employees are free to join trade unions according to the local rules and regulations. In
2024, 78.8% of the Group’s employees were covered by collective agreements (2023:
78.5%). (S1-8-60-(a))
Collective bargaining and social dialogue coverage
Collective bargaining coverage
Social dialogue
Coverage rate
Employees – EEA
(for countries with >50 empl.
representing >10% total
employees)
Employees – non-EEA
(estimate for regions with
>50 empl. representing
>10% total empl.)
Workplace representation (EEA
only)
(for countries with >50 empl.
representing >10% total empl.)
0–19%
USA
20–39%
40–59%
60–79%
80–100%
Finland, Sweden, Germany
Finland, Sweden, Germany
(S1-8-60-(b-c), S1-8-63-(a), S1-8-AR 70)
The Outokumpu Personnel Forum is an important information channel between its
personnel and management in the company’s European operations. The forum is based on
the European Works Council Directive. The Personnel Forum appoints the Group Working
Committee, which is responsible for the operative cooperation between the management
and employees. During the year, the committee convened five times. (S1-8-63-(b))
Outokumpu does not use metrics other than those stated above, to evaluate performance
and effectiveness in relation to collective bargaining coverage. (S1-8-MDR-M-75)
Similar to all headcount figures, data from employees who are covered by collective
agreement or individual contract are taken from Outokumpu’s global personnel information
system. The numbers concerning social dialogue are nearly the same. When there are
differences, data is collected individually from the countries concerned. (S1-8-MDR-M-77-(a))
The key figures related to own workforce are not validated by any external body other than
the assurance provider. (S1-8-MDR-M-77-(b))
Diversity metrics
Outokumpu has established targets and a comprehensive roadmap to strengthen diversity,
equity, and inclusion (DEI) throughout the company.
Gender diversity at top management level
2024
Gender
Male
Female
Other
Not
disclosed
Total
Number of top management employees
54
33
0
0
87
Percentage of top management
employees
62.1 %
37.9 %
— %
— %
100.0 %
(S1-9-66-(a))
Outokumpu Annual Report 2024
123
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Outokumpu defines top management in its diversity target as all leaders belonging to a key
management team, at business area, business line or group function level. Besides the
Outokumpu Leadership Team including the CEO, the leadership teams from the Americas
and Ferrochrome business areas, the Stainless Europe and Advanced Materials business
lines, as well as from the Group functions Finance, HR, Procurement, Legal, Technology and
IT are part of Outokumpu’s top management. The majority of the leaders of these
leadership teams report to the CEO. (S1-9-66-(a), S1-9-MDR-M-77-(a), S1-9-AR-71)
Outokumpu also follows the development of diversity in leadership on a quarterly basis
through two other metrics: the share of diversity in each key management team (related to
its 30% target) and the number of diverse leaders added to the organization overall (related
to its +100 target). More information is available in the Targets related to own workforce
section (S1-5) below in this chapter. (S1-9-MDR-M-75)
Age distribution across own workforce
Age groups
Under 30
years
30-50 years
Over 50 years
Total
Number of employees
1,310
4,400
3,026
8,736
Percentage of employees
15.0 %
50.4 %
34.6 %
100.0 %
(S1-9-66-(b))
The key figures related to own workforce are not validated by any other external body than
the assurance provider. (S1-9-MDR-M-77-(b))
Adequate wages
Outokumpu is committed to providing its team members with a comprehensive total
rewards package, encompassing base salary, short-term incentives and benefits aligned
with market practices and local pay structures, and equity-based long-term incentives for
eligible individuals.
According to its thorough analysis, all employees at Outokumpu are paid wages that meet
or exceed the established adequacy benchmarks within their respective countries.
(S1-10-69, S1-10-70)
To check whether all its employees are paid adequate wages, Outokumpu compared the
lowest salary paid in 2024 in each country with the minimum wage standards in the
respective country. For countries where minimum wage information is not available, data on
adequate wages is obtained by researching sector-specific wage agreements and/or
collective agreements. (S1-10-MDR-M-77-(a))
The key figures related to adequate wages are not validated by any external body other
than the assurance provider. (S1-10-MDR-M-77-(b))
Outokumpu does not use metrics other than those stated above to evaluate performance
and effectiveness in relation to adequate wages. (S1-10-MDR-M-75)
Social protection
All Outokumpu employees are covered by social protection against loss of income due to
major life events. In many of Outokumpu’s operating countries, this coverage is mandated
by law or collective agreements. In some cases, Outokumpu provides benefits beyond what
public and collective programs mandate. These additional benefits are highlighted in the
table.
Social protection by country
Country
Sickness
Unemployment
Injury &
disability
Parental leave
Retirement
Finland
X
X
X
X
X
Sweden
X Outokumpu
X Outokumpu
X
X Outokumpu
X
Germany
X
X
X Outokumpu
X
X
UK
X Outokumpu
X
X
X Outokumpu
X Outokumpu
Netherlands
X Outokumpu
X
X Outokumpu
X
X Outokumpu
Lithuania
X
X
X
X
X
Italy
X
X
X
X
X
Poland
X
X
X
X
X
USA
X Outokumpu
X
X Outokumpu
X Outokumpu
X Outokumpu
Mexico
X
X
X
X
X Outokumpu
X = covered by public program or collective agreement.
X Outokumpu = Outokumpu-specific coverage instead or on top of public program.
Only countries where Outokumpu has at least 50 employees are listed in the table.
In countries where Outokumpu has fewer than 50 employees, all employees are also
covered by social protection against loss of income due to sickness, unemployment,
occupational injury or disability, parental leave and retirement. (S1-11-74-(a-e), S1-11-75)
Persons with disabilities
In most of Outokumpu’s main countries of operation, data collection regarding disabilities
is legally restricted. Asking employees for this type of personal information is usually
considered an unlawful invasion of privacy.
The only notable exception is Germany, where according to the German Social Code,
Outokumpu reports on the number of positions filled by individuals with severe disabilities.
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
In 2024, altogether 9.6% of Outokumpu’s workforce in Germany were people with
disabilities. (S1-12-79)
The data about people with disabilities in Germany is gathered in and reported from the
German payroll system. (S1-12-MDR-M-77-(a))
The percentage of people with disabilities in Outokumpu Germany is reviewed both by the
assurance provider and by the German authorities. (S1-12-MDR-M-77-(b))
Outokumpu does not use metrics other than those stated above to evaluate performance
and effectiveness in relation to people with disabilities. (S1-10-MDR-M-75)
Training and skills development metrics
Outokumpu invests in the growth and advancement of its workforce. To support the
employees’ professional development, leadership skills, and succession planning,
Outokumpu implements various employee programs.
Overall, the number of training courses increased again in 2024. The focus remained on
management development, with its Leadership Pipeline training program, and its License to
Lead training especially designed for shift supervisors. In operations, safety was as usual a
key training topic and “Team Dialogue” trainings were rolled out to increase awareness on
diversity, equity and inclusion through discussion. Function-specific qualifications were also
in focus, with programs such as Sales Academy and Finance Academy.
The majority of the training is organized in e-learning courses, although the number of face-
to-face events has increased significantly since the Covid years. The e-learning courses
focused on training in the areas of security, ethics and compliance and cyber and data
security, while leadership topics were mainly covered in face-to-face events.
Employees are encouraged and supported to set and achieve goals, ensuring they get
personal and professional benefits from the company’s development opportunities.
Training hours by gender
2024
Gender
Male
Female
Other
Not
Disclosed
Total
Training hours
55,479
15,434
0
0
70,913
Average training hours per employee
7.8
9.4
0
0
8.1
(S1-13-83-(b))
Performance discussions by gender
2024
Gender
Male
Female
Other
Not
Disclosed
Total
Percentage of agreed performance
discussions
92.0 %
88.8 %
— %
— %
91.4 %
(S1-13-83-(a))
Outokumpu’s performance management happens in an annual and continuous process,
which ensures that managers and employees understand their main tasks, as well as how
they contribute to Outokumpu’s strategy implementation and business targets. Managers
need to follow up and support their direct reports in achieving their targets, which is seen
as an excellent opportunity to give regular feedback and leverage high performance. All
employees in Outokumpu are included in the performance management process.
Outokumpu also uses other metrics to evaluate performance and effectiveness in relation
to learning and development, such as training feedback scores, or average performance
rating in different areas. (S1-13-MDR-M-75)
Learning information such as training hours as well as performance management-related
data is available in Outokumpu’s global personnel information system. Information from
external trainings is also maintained in the system. (S1-13-MDR-M-77-(a))
The key figures related to own workforce are not validated by any external body other than
the assurance provider. (S1-13-MDR-M-77-(b))
Health and safety metrics
Outokumpu monitors, measures, analyzes and evaluates health and safety performance
regularly. The company uses both leading, or preventive, and lagging, or reactive, indicators
for health and safety. The company has in place a yearly development plan for health and
safety, and internal audits and regular reviews are made with the long-term objectives and
vision in the background. (S1-14-MDR-M-75)
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Outokumpu has in place a corporate instruction that describes and defines every indicator
alongside the method for calculating incident frequencies for those indicators. (S1-14-MDR-
M-77-(a))
Outokumpu regularly audits the following sites for its stainless steel operations: sites in
Tornio, Finland; Dahlerbrück, Dillenburg and Krefeld, Germany, as well as Avesta, Degerfors
and Nyby in Sweden are certified according to the ResponsibleSteel certification. In
addition, its operations in Avesta and Nyby in Sweden, Calvert in Alabama, the US, and
Castelleone in Italy are certified according to ISO 45001. The desired certification and
verifier depend on the country in which site is operating. (S1-14-MDR-M-77-(b))
Work-related injuries
2024
Own
Workforce
Employees
Non-
employees
Value chain
workers on
employer's sites
% of workforce covered under health & safety
management system
100 %
100 %
100 %
N/A
Number of fatalities as a result of work-related
injuries & ill health
1
—
1
—
Rate of recordable work-related accidents in own
workforce (TRIFR), %
1.5
1.4
2.0
N/A
Number of recordable work-related accidents
31
21
10
N/A
Number of cases of recordable work related ill
health
N/A
3
N/A
N/A
Number of days lost to work-related injuries and
fatalities
636
598
38
N/A
(ESRS S1-14-88-(a-e))
Work-life balance metrics
Outokumpu is committed to promoting the work–life balance of its team members. The
company offers various benefits such as paid leaves, occupational health care and support
programs, depending on the location. The company tries for and accommodates flexible
arrangements wherever the nature of work allows. It also supports part-time work and
encourages all of its employees to take the family-related leaves to which they are entitled
to.
100% of 8,736 employees are entitled to take family-related leave. (S1-15-93-(a), S1-15-94)
38 (2.3%) of 1,648 women and 91 (1.3%) of 7,088 men have taken family-related leave
during the year.
Work–life balance – family-related leave by gender
Male
Female
Other
Not
disclosed
Total
Personnel utilized family-related leave by
gender
1.3 %
2.3 %
— %
— %
1.5 %
(S1-15-93-(b))
Outokumpu does not use metrics other than those stated above to evaluate performance
and effectiveness in relation to work–life balance, although employees’ insights on that
topic are regularly checked in people pulse surveys. (S1-15-MDR-M-75)
Absence information from employees, such as maternity and paternity leave, are taken
from the global personnel information system. Both short-term and long-term absences (6
months or more) are tracked in the system. (S1-15-MDR-M-77-(a))
The key figures related to own workforce are not validated by any external body other than
the assurance provider. (S1-15-MDR-M-77-(b))
Remuneration metrics
To ensure fairness and non-discrimination, Outokumpu runs regular statistical analyses of
compensation, considering internal job factors, individual factors, and external market
conditions. This enables the company to identify and address any pay discrepancies, which
are systematically corrected as part of its annual salary review process. It also works
closely with collective bargaining agents and employee representatives to ensure alignment
with both ethical and legal standards.
Gender pay gap
The company’s unadjusted gender pay gap is currently 8.76%%, meaning female employees
earn EUR 4,804 more annually on average than male employees. This unadjusted gap is
largely due to the distribution of roles, with women more represented in senior
administrative and executive positions, which offer higher pay, while men are more
concentrated in operational roles, which tend to pay less. These structural differences
significantly influence the overall pay gap. (S1-16-97-(a))
Remuneration ratio
The remuneration ratio between the highest-paid individual and the median-paid employee
is 32.59 to 1, meaning that the highest pay is 32.59 times more than the median. This
ratio is largely influenced by the number of operational roles, which typically offer lower
pay. Additionally, the company’s salaries align with local market practices, with many roles
located in regions with high inflation, lower living costs, and fluctuating exchange rates.
While these salaries are lower, they remain competitive within their local markets.
(S1-16-97-(b))
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Methodologies to calculate remuneration metrics
To calculate the gender pay gap, Outokumpu compares the average actual pay of women
with that of men, regardless of possible explanatory factors such as job level,
qualifications, and experience. Currently only base pay and short-term incentives are
included in the calculation, but the company intends to include other compensation
elements in the calculation in the future.
To calculate the remuneration ratio, in 2024, Outokumpu considers base salaries and
short-term incentives on target level, and compares the remuneration of the highest-paid
individual to the median remuneration of all other employees within the organization. As of
2025, the data set will be enhanced to include other compensation elements, such as
benefits and long-term incentives. (S1-16-97-(c), S1-16-MDR-M-77-(a))
The remuneration ratio is not validated by any external body other than the assurance
provider. The gender pay gap, however, is also validated by Fair Pay Workplace, the
independent organization Outokumpu works with to ensure pay equity. (S1-16-MDR-M-77-(b))
To evaluate performance and effectiveness in relation to remuneration, Outokumpu also
calculates its adjusted gender pay gap, and in the USA, pay gaps linked to ethnicity. (S1-16-
MDR-M-75)
Incidents, complaints and severe
human rights impacts
Outokumpu is currently developing a group-wide process to track and report the data
required by S1-17 on the number of work-related incidents, complaints and severe human
rights impacts within its own workforce, and any related material fines, sanctions or
compensation. More information about the processes for remedy at Outokumpu is under
Own workforce (S1) chapter in Processes section under “Remedy”. (S1-17-MDR-M-75)
As part of this development work, Outokumpu will also decide on the methodologies and
assumptions behind the metrics, (S1-17-MDR-M-77-(a)) as well as estimate if any other
external bodies besides the assurance provider are required or included in providing the
valuation. (S1-17-MDR-M-77-(b))
Incidents and complaints of discrimination and harassment
Outokumpu is developing further its approach to systematic identification and reporting of
incidents and complaints of discrimination or harassment, covering both local operations
and group functions. The process will be finalized in 2025 as part of the sustainability due
diligence development. (S1-17-103-(c))
The process development is coordinated by Group Sustainability together with key internal
stakeholders. These include, among others, Human Resources and Occupational Health
and Safety teams at manufacturing sites, which work with alleged local cases at operations
as well as group functions such as Legal, Ethics & Compliance and Internal Audit, which
maintain Outokumpu’s group-wide whistleblowing channel SpeakUp. This is a global form of
grievance mechanisms at Outokumpu and includes also reported cases related to social
sustainability and human rights matters. (S1-17-103-(d))
Currently, work-related incidents and complaints of discrimination are investigated case-by-
case at local operations or centrally by Internal Audit. Outokumpu will continue developing
data gathering process on these cases to ensure reliable and consistent information from
local operations and group functions. Consequently, Outokumpu will disclose the more
detailed data for work-related incidents and complaints for 2025. (S1-17-103-(a)), (S1-17-103-
(b)).
Severe human rights incidents
Outokumpu is also developing a general group-level approach to systematic identification of
severe human rights issues and incidents concerning its own workforce, value chain workers
and affected communities. The process for gathering this data is under development and
will be ready during 2025 as part of the sustainability due diligence development. If such
cases have emerged, they have been assessed case by case. (S1-17-104-(a))
In 2024, there was one reported case of severe human rights issues or incidents connected
to Outokumpu’s own operations. A contractor fatality took place at Outokumpu’s
manufacturing site in San Luis Potosí, Mexico, while a contractor was working at height. Full
measures were taken to investigate the incident jointly with the authorities and
improvements were taken across sites. Outokumpu had not reported any fatalities since
May 2017. (S1-17-104-(a))
In 2024, no paid fines, penalties or compensation (EUR 0) for damages as a result of the
work-related incidents, complaints or severe human rights incidents were reported. As yet,
there is no structured group-wide process to track the amount of material fines, penalties,
and compensation for damages as a result of the incidents, complaints and reconciliation
of such monetary amounts. This process, covering both local operations and group
functions, will be finalized during 2025. (S1-17-103-(c)), (S1-17-104-(b))
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
audi
S2 – Workers in
the value chain
Workers in the value chain, their working conditions and other work-related rights were
identified as material for Outokumpu in its double materiality assessment.
Material impacts, risks and opportunities resulting from
the materiality assessment
S 2.1 Working conditions
Impacts
Positive
Outokumpu strives to use its influence effectively, both alone and in collaboration with
others, to improve the working conditions in the upstream value chain and to have an
actual positive impact. Outokumpu has a potential positive impact on the upstream
value chain workers by actively strengthening human rights in the supply chain. The
social audits and human rights assessments identify shortcomings and drive supplier
improvements.
Negative
Poor working conditions in the form of inadequate wage, excessive overtime, health
and safety issues and restricted freedom of association have an actual negative
impact on workers in the upstream value chain, especially in high risk countries,
where labor regulations are inadequate or poorly enforced. Poor access to
whistleblower channels may prevent reporting of violations, which has an actual
negative impact, too.
Risks and
opportunities
Risk
Human rights violations against upstream value chain workers and a lack of
transparency regarding human rights issues can harm Outokumpu's reputation,
leading to decreased sales and public scrutiny. Legal proceedings against the
company or its partners could result in fines, penalties, and loss of business licenses,
negatively impacting financial performance. Additionally, social unrest from labor
issues can disrupt supply chains and increase operational costs, which can negatively
impact the financial performance.
Outokumpu Annual Report 2024
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Outokumpu is part of the global value chain by
producing stainless steel. From production and
delivery of raw materials to services supporting
its operations, the company recognizes the
importance of the workers in the value chain, and
it is committed to respecting their human rights.
KEY ACTIONS in 2024
Supplier Code of Conduct
renewed and introduced to
additional upstream value
chain categories.
Upstream value chain
mapping completed to
identify high risk value
chains.
Criteria for human rights
and environmental impact
assessment refined.
PLAN 2025
Analyze the upstream value
chain beyond direct suppliers
in selected additional
categories, to increase
knowledge about impacts in
these value chains.
Heightened focus on
addressing identified impacts
and development of grievance
mechanisms and remedy
process.
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
S 2.3 Other work-related rights (value chain)
Impacts
Positive
Outokumpu has a potential positive impact on the upstream value chain workers by
actively strengthening human rights in the supply chain. The social audits and human
rights assessments identify shortcomings and drive supplier improvements. By
providing training and support on human rights to its suppliers Outokumpu can
enhance positive impacts on the human rights and sustainability practices across its
value chain.
Negative
Without regular reviews of labor conditions, severe human rights issues such as
modern slavery and forced labor can arise in Outokumpu’s upstream value chain. Poor
housing, limited water access, and sanitation issues among value chain workers can
lead to health and safety violations. In the mining industry, child labor may occur,
particularly in less developed countries, leading to significant harm to children's rights
and well-being. These are potential negative impacts on the upstream value chain
workers.
Risks and
opportunities
Opportunity
A resilient supply chain, supported by human rights-focused guidelines, can prevent
disruptions, reduce operational costs, and create new revenue opportunities. Effective
due diligence and strategic upstream value chain management can further reduce
costs and differentiate Outokumpu from competitors, enhancing market access.
Strong ESG performance may also boost access to capital and attract investors,
resulting in favorable financing conditions and improved business opportunities.
Risks related to value chain workers remained below the reporting threshold.
(ESRS 2-SMB 3-48-(a))
Strategy
Material value chain workers-related impacts,
risks and opportunities and their interaction with
strategy and business model
Interaction with the strategy and business model
Actual and potential impacts on value chain workers, as identified in ESRS 2 IRO-1 are
connected to the Outokumpu's strategy and business models as raw materials availability
is tied to geographical occurrence and sourcing has to be done also from countries with
identified human rights risks. To decrease the negative impacts, Outokumpu has been
adapting it's strategy and business model e.g. through building partnerships with suppliers
showing commitment in sustainability and human rights and putting strong focus on
supplier due diligence process to identify, prevent and mitigate any negative impacts. (ESRS
2-S2-SBM-3-10-(a)-(i) (ESRS 2-S2-SBM-3-10-(a)-(ii), (ESRS 2-S2-SBM-3-10-(b)
Types of value chain workers
According to Outokumpu’s double materiality assessment, value chain workers subjected to
material impacts include: (S2-ESRS 2 SBM-3-11-(a), S2-ESRS 2 SBM-3-11)
•
workers working for entities in Outokumpu's upstream value chain involved in the
extraction of metals or minerals, in refining and processing of metals and minerals, and
in the activities of logistics, and
•
workers within the prior categories who are particularly vulnerable to negative impacts
include young workers and migrant workers. (S2-ESRS 2 SBM-3-11-(a-v)
Geographies with risk of child labor or of forced labor
As part of its supply chain due diligence, Outokumpu identifies the risk of human rights
violations in the countries from where it might source metals and minerals. Based on the
TDi AIRS human rights risk score, sourcing countries with high risk for human rights
violations are Zimbabwe, Swaziland, Turkey, Saudi Arabia, Vietnam, China, Gabon and
Madagascar. In Brazil, Colombia, Mexico, India, Indonesia, Peru, United Arab Emirates,
South Africa and Mongolia the risk for human rights violations is medium.
According to VeriskMaplecroft’s Child Labor Index, Zimbabwe, Eswatini, Vietnam, China,
Madagascar, Brazil, Colombia, Mexico and India are sourcing countries with an extreme risk
of child labor in Outokumpu’s supply chain of metals and minerals. Taking into account the
global slavery index of WalkFree, Saudi Arabia, Turkey, and the United Arab Emirates are
considered to have an extreme risk for forced labor, and India, Colombia, Gabon, Peru,
Indonesia, and Mexico are considered to have a high risk of forced labor.
(S2-ESRS 2 SBM-3-11-(b))
Material negative impacts
In the metals and mining industry, poor working conditions can have a systemic negative
impact on value chain workers in high risk countries. A potential systematic negative
impact also lies in child labor and forced labor in metals and minerals mining and
processing in the high-risk countries in the upstream value chain. Hazardous substances in
scrap have a negative impact in scrap recycling and processing. (S2-ESRS 2 SBM-3-11-(c))
Material positive impacts
Outokumpu is driving a positive impact on value chain workers by supporting human rights
initiatives, as well as education of suppliers and enforcing its Supplier Code of Conduct and
Raw Materials Supplier Requirements. The aim is to increase the commitment to protect
and respect human rights in the upstream value chain, which will potentially improve the
working conditions and other work-related rights of value chain workers.
(S2-ESRS 2 SBM-3-11-(d))
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Risks and opportunities
There are financial risks relating to poor working conditions in the upstream value chain,
proceedings against Outokumpu and its partners and third-party intermediaries can lead to
fines, penalties and sanctions. In addition, where Outokumpu would have contributed to the
negative impacts, the remediation of such impacts can cause financial effects on
Outokumpu. Failure in requiring business partners to follow ethical standards leading to
human and labor rights breaches can cause reputational damage and thus financial losses
to Outokumpu. A lack of transparency regarding human rights issues in the company's
value chain can also have a negative impact on brand image and sales figures. In addition,
social unrest (e.g., strikes, protests) due to labor or human rights violations could lead to
delays or interruptions in the supply chain.
Effective due diligence with Outokumpu’s partners and third-party intermediaries can
improve supply chain resilience and decrease operational costs. Outokumpu can
differentiate itself from competitors and gain access to regulated ethical markets, which
can open new revenue streams. (S2-ESRS 2 SBM-3-11-(e))
Understanding potential greater risks
Understanding of how workers with particular characteristics, those working in particular
contexts, or those undertaking particular activities may be at greater risk of harm is gained
through surveys and risk and impact assessments. These are carried out for specific high-
risk countries and specific industry sectors. All data gathered during the supplier due
diligence process (onboarding, self-assessments and on-site assessments) is utilized. (S2-
ESRS 2 SBM-3-12)
Risks and opportunities related to specific groups
The potential opportunity to strengthen business by committing to high integrity and
respecting human rights comes from addressing impacts on value chain workers in the
metals and mining industry in high-risk countries. This includes vulnerable groups like young
workers at risk of child labor and minorities and immigrant workers vulnerable to forced
labor. (S2-ESRS 2 SBM-3-13)
Impact, risk and opportunity
management
Policies
Policies related to value chain workers
The key policies related to the value chain workers are Outokumpu’s Supplier Code of
Conduct and Raw Materials Supplier Requirements. Other supporting policies are the
Human Rights Policy, Sustainability Policy and Code of Conduct. These policies relate to all
the impacts, risks and opportunities on environmental, social and governance topics with a
connection to the upstream value chain workers. (S2-1-16)
Key contents of policies
The Supplier Code of Conduct outlines the standards and expectations Outokumpu sets for
its suppliers to ensure ethical, sustainable and responsible practices throughout the value
chain. The policy covers safety and healthy workplace, sustainable future, human rights and
dignity, and good corporate citizenship, following the four key ethical principles in the
Outokumpu Code of Conduct. The policy expects suppliers to:
•
take all necessary actions to keep their workforce and surrounding communities safe
and healthy,
•
reduce negative impacts on the environment, especially on climate and biodiversity, and
reduce the use of energy and minimize waste and emission into air, water and soil,
•
respect and protect internationally recognized human rights and have a proper grievance
and remedy processes, and
•
comply with all applicable laws and regulations as well as adhere to similar ethical
standards as Outokumpu.
It is stated, that alongside any other actions Outokumpu may take, if a supplier causes or
contributes to human rights violations, they are expected to cease those violations
immediately, provide remedies to the affected individuals, and implement a corrective
action plan.
The Raw Materials Supplier Requirements describe the minimum requirements for suppliers
delivering raw materials. Expectations are set on responsible and ethical business
practices, human rights, health and safety, environment, quality management, supply and
production control, product liability, intellectual property rights, confidentiality and security,
corporate governance, financial statement, self-assessments and audits, and business
contacts. Outokumpu expects its suppliers to have or work toward systems that follow the
UN Guiding Principles on Business and Human Rights. Suppliers are expected to co-operate
in a transparent manner with Outokumpu, including granting Outokumpu or a third party
authorized by Outokumpu the possibility to conduct audits in their facilities.
Outokumpu monitors its suppliers’ compliance with the Supplier Code of Conduct and Raw
Materials Supplier Requirements through self-assessments, screenings and audits.
As stated in Outokumpu’s Human Rights Policy and Sustainability Policy, Outokumpu
expects its employees, business partners and other parties, whose own impacts may be
directly linked to our operations, products, or services, to respect and not infringe upon
human rights. More information on the Human Rights Policy can be found in the Affected
communities (S3) chapter in the Policies section and on the Sustainability Policy in Climate
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
change chapter (E1) in the Policies section under “Policies related to climate change
mitigation”.
In addition, responsible purchasing and knowing business partners is part of the
Outokumpu Code of Conduct. As stated in the Code of Conduct, suppliers are expected to
co-operate in a transparent manner with Outokumpu and must also evaluate and monitor
their own supply chain. Outokumpu wants to know who its business partners are to ensure
Outokumpu is not involved in any unethical, illegal or criminal activities. Outokumpu
employees must follow Outokumpu’s risk-based due diligence approach, which considers
and verifies the basic facts about our business partners. Outokumpu employees shall
regularly monitor the activities of their business partners to ensure Outokumpu can
continue business with them. More information on the Code of Conduct can be found in
the Governance (G1-1) chapter in the Policies section under “Policies related to business
conduct and corporate culture”.
More information specifically on commitments to address trafficking, forced and child labor
is provided below in this chapter under “Addressing trafficking, forced and child labor”. (S2-
MDR-P-65-(a))
Compliance with the Supplier Code of Conduct and Raw Materials Supplier Requirements is
formally integrated into agreements and general terms and conditions with suppliers. Since
the Supplier Code of Conduct and Raw Materials Supplier Requirements were launched,
signed confirmations have been obtained from targeted suppliers to ensure they commit to
and implement principles aligned with the Outokumpu’s policies in their operations. To
promote transparency and awareness, all relevant policies are publicly accessible on the
company’s website and regularly communicated to external stakeholders through various
engagement channels. (S2-MDR-P-65-(f))
Scope
The Outokumpu Supplier Code of Conduct is applicable to all suppliers and their workforce,
that deliver materials, products and/or services to any Outokumpu legal entity, regardless
of their position in the supply chain, meaning whether they are direct suppliers or are
further upstream. Outokumpu expects its direct suppliers to ensure that their suppliers
comply with the Outokumpu Supplier Code of Conduct as well.
The Raw Materials Supplier Requirements are applicable to the raw materials category with
a focus specifically on metals and mining industry-related sustainability. (S2-MDR-P-65-(b))
Accountability and stakeholders
As many of the identified salient human rights risks and impacts are connected to
Outokumpu’s sourcing activities, the related responsibility for ensuring the implementation
of policies and engagement in the upstream value chain cascades from the CEO to the CFO
and from there to the Head of Raw Materials and further to the Head of Supplier
Sustainability, who has operational responsibility. More information about accountability is
available in the Affected communities (S3) chapter in the Policies section. (S2-MDR-P-65-(c))
Outokumpu has collected views from stakeholders through various channels that have an
influence on how to set its policies. Outokumpu is in the process of developing a group-wide
approach and establishing a process for stakeholder engagement, including workers in the
value chain, as part of the company’s sustainability due diligence process development.
More information on the development of stakeholder engagement at Outokumpu can be
found in the General information chapter (ESRS 2 SBM-2). (S2-MDR-P-65-(e))
Third-party standards and alignment with internationally
recognized instruments
Through the Human Rights Policy, Outokumpu is committed to conducting its business with
high integrity and in compliance with all national laws and international human rights
principles including the United Nations Universal Declaration of Human Rights, the
International Covenant on Civil and Political Rights, the International Covenant on
Economic, Social and Cultural Rights, the European Convention on Human Rights, and the
International Labor Organization’s Declaration on Fundamental Principles and Rights at
Work. In addition to the United Nations Guiding Principles on Business and Human Rights,
Outokumpu is committed to the OECD Due Diligence for Responsible Supply Chains of
Minerals from Conflict-Affected and High-Risk Areas, the OECD Guidelines for Multinational
Enterprises, and the UN Sustainable Development Goals and is also a signatory member of
the UN Global Compact.
Outokumpu is also a member of the ResponsibleSteel initiative and committed to
supporting its vision and mission. Outokumpu also has ResponsibleSteel certification for all
its manufacturing sites in Europe. As a chromium mining operator, Outokumpu is a member
of the Finnish Network for Sustainable Mining (S2-MDR-P-65-(d)), (S2-1-19)
Human rights commitments relevant for value chain workers
Outokumpu’s human rights commitments relevant to value chain workers are stated in the
Human Rights Policy. Outokumpu expects all its suppliers to adhere similarly to
internationally recognized human rights standards, such as the Universal Declaration of
Human Rights, and the company actively works to ensure that workers within its supply
chain are treated with dignity and are free from forced labor, child labor, or any form of
exploitation. Regular assessments and audits are conducted to verify compliance with
these commitments.
More information about the coverage of the Human Rights Policy is available in the
Affected communities (S3) chapter, in the Policies section, under “Key contents of the
policy”. (S2-1-17)
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
General approach to respecting human rights of value chain workers
Outokumpu is dedicated to collaborating with partners, suppliers, sub-suppliers, and
customers to proactively address and mitigate potential and actual adverse impacts on
human rights, including environment and community rights. To follow up the commitments
stated in the policies related to value chain workers and monitor compliance with the UN
Guiding Principles on Business and Human Rights, ILO Declaration on Fundamental
Principles and Rights at Work or OECD Guidelines for Multinational Enterprises, Outokumpu
monitors its raw material suppliers through self-assessments, screenings and audits. Most
suppliers also go through monthly compliance screening for sanctions. Procurement uses
EcoVadis for self-assessments, with focus on environment, labor and human rights, ethics,
and sustainable procurement. As a result of the self-assessments, improvement
opportunities and non-conformities to requirements can be identified and corrective actions
agreed with the suppliers. The countries in which suppliers operate are mapped against the
countries listed in the Dodd Frank Act Section 1502, conflict-affected and high-risk areas
(CAHRAs) as published by the European Union, and TDi Sustainability’s Alert Index for
Responsible Sourcing (AIRS).
In addition to EcoVadis and the country risks, suppliers are also assessed based on, for
example, available certifications, spend, previous audit results, and overall performance
scorecard results. Based on these indicators, suppliers are annually selected for on-site
reviews. Those reviews vary from on-site visit to audit or human rights impact assessment,
depending on the identified risk level
This structured, impact and risk-focused supplier due diligence process identifies and
prioritizes areas with the highest potential for severe human rights impacts and aligns with
Outokumpu’s commitment to fostering responsible and ethical practices throughout its
value chain. (S2-1-17-(a))
Engagement with value chain workers
Upstream value chain workers are engaged during social audits and human rights
assessment via interviews before and during audits. Typical candidates for worker
interviews are:
•
directly employed male site worker,
•
directly employed female site worker,
•
site worker engaged in the workers’ council or union,
•
young worker or trainee,
•
sub-contracted site worker,
•
temporary site worker,
•
worker belonging to a minority,
•
security worker,
•
driver,
•
cleaning worker,
•
canteen worker and
•
union representative.
The human rights impact assessment includes, in addition, interviews with the community
and non-governmental organizations. (S2-1-17-(b))
Remedy
More information on remedy for human rights impacts can be found in Own workforce (S1)
chapter, in the Policies section, under “Remedy for human rights impact”. (S2-1-17-(c))
Addressing trafficking, forced and child labor
Trafficking, forced and child labor are addressed in several Outokumpu policies: the
Supplier Code of Conduct, Raw Materials Supplier Requirements, Human Rights Policy and
Sustainability Policy.
Outokumpu’s Supplier of Code of Conduct states that Outokumpu expects its suppliers,
regardless their place (direct suppliers or further upstream) in the supply chain, to respect
and protect internationally recognized human rights, respect and protect the rights of
children, comply with international labor treaties and condemn all forms of modern slavery,
forced labor, and the use of child labor. The Supplier Code of Conduct include provisions
addressing the safety of workers, equal opportunities and pay, freedom of association,
human trafficking, the use of forced labor or child labor. These provisions are fully in line
with the applicable ILO standards.
The Raw Materials Supplier Requirements state that Outokumpu expects its suppliers to
respect and protect all human rights, and pay specific attention for example to condemning
the use of child labor, forced labor, bonded labor, slavery, or any form of modern slavery,
and human trafficking. The Raw Materials Supplier Requirements also state that
Outokumpu does not tolerate restrictions of movement, excessive recruitment fees for
employees, confiscation of identity documents and/or passports or withholding of wages.
In Outokumpu’s Human Rights Policy, it is stated that Outokumpu does not accept the use
of forced labor, bonded labor, slavery, or any form of modern slavery within Outokumpu or
in its supply chain. The company does not tolerate or accept any form of human trafficking,
restrictions of movement, excessive recruitment fees for employees, confiscation of identity
documents and/or passports or withholding of wages, and it does not approve of child labor
with no exceptions.
In the Sustainability Policy, it is stated that at Outokumpu, the human rights and dignity
commitment mean that Outokumpu condemns the use of child labor, forced or bonded
labor or any kind of slavery. In addition, business conduct with high integrity means that
Outokumpu ensures that modern slavery and human trafficking play no part in the supply
chain or in any part of the business. (S2-1-18)
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Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Cases of non-respect and aligning with international instruments
Outokumpu does not currently have a corporate process in place to track and monitor
cases of non-respect of UNGPs, the ILO Declaration on Fundamental Principles and Rights
at Work or OECD Guidelines involving workers in the value chain. Such a process and
policies with relevant instruments will be defined when developing further sustainability due
diligence for Outokumpu’s own operations and value chain in 2025. During the reporting
period, there has been one reported case of non-respect of these guidelines in
Outokumpu’s own operations. Outokumpu understands the meaning of “a case of non-
respect” as a situation in which a severe human rights impact, such as a fatality, has
happened despite the due diligence process and/or other measures based on the
aforementioned frameworks. More information can be found in disclosures regarding the
company’s own workforce (S1) chapter, under “Incidents, complaints and severe human
rights impacts.
In addition, Procurement organization has a separate process to identify and manage ESG
incidents in the supply chain: ESG (environment, social and governance) incidents in the
supply chain are cases of non-compliance that are identified by or reported to the
Procurement organization. An investigation is coordinated and documented by the
Procurement organization. The main purpose of the ESG incident management process is
to fulfill obligations under the UNGPs. The process includes desktop research, potential
purchasing stops, decisions about on-site assessments, a human rights impact and risk
assessment, Outokumpu’s attribution to the identified impacts and risks, defining and
agreeing on improvement actions, internal and external stakeholder information, and
documentation of the case.(S2-1-19)
Processes
Processes for engaging with value chain workers
Upstream value chain workers perspectives are canvassed during supplier audit interviews.
Outokumpu’s social audits focus on worker interviews and human rights impact
assessments include interviews with the value chain workers, community and non-
governmental organizations (NGOs). In addition to the current management processes
focused on upstream value chain, Outokumpu is developing further a general process to
engage with various types of stakeholders affected by its operations during 2025. (S2-2-22)
Engagement strategy
Suppliers are selected for three different types of on-site assessments: sustainability visits,
on-site audits and human rights impact assessments. The assessment type is based on a
number of criteria related to human right and environmental risks. These include industry
and country specific risks, EcoVadis result, environmental and safety certifications and
possible results of previous on site assessments. The on-site visit type is defined based on
the risk level identified, human rights impact assessment being applied for suppliers with
highest risk score.
The purpose of the on-site assessments is to determine the maturity level of the supplier’s
human rights due diligence processes, assess how the supplier addresses selected specific
issues as well as identify and assess specific potential and actual human rights risks in the
supplier’s own operations or its value chain (e.g. working conditions. Furthermore, the
purpose of the on-site assessments is to define recommendations for improvement of the
supplier’s human rights due diligence processes and suggest mitigation actions for
potential and actual human rights impacts. Typical human right risks assessed during visits
include working conditions (wage, overtime, health and safety, freedom of association),
access to whistleblower channels, forced and child labor, housing and hygiene.
Outokumpu sustainability visit includes management interviews and a site tour but doesn’t
include direct involvement of the supplier’s workers.
Outokumpu social audit is executed by a trained Outokumpu employee, and it consists of
following phases: audit preparation, on-site visit with a focus on worker interviews and final
report. The final result is a written audit report including the maturity level of the supplier’s
human rights due diligence processes, a human rights risk assessment and
recommendations for improvement.
Human rights impact assessment is a third-party assessment for a high-risk supplier, with
Outokumpu participation. It is an enhanced assessment of one or multiple suppliers, their
site or sites, and the surroundings. The process includes interviews with the value chain
workers, union representatives, community, and non-governmental organizations. The final
result is an extensive assessment report, including the maturity level of the supplier’s
human rights due diligence processes and recommendations for improvement.
The information and perspectives of the interviewed value chain workers and their
representatives are taken into consideration when the final report and improvement
recommendations are prepared. The results are communicated to the supplier, and needed
improvement actions are agreed upon together. The results are also evaluated internally
and utilized in the supplier sustainability impact and risk assessment. (S2-2-22-(a))
Engagement stages and frequency
While Outokumpu’s social audit focuses on worker interviews, the human rights impact
assessment includes interviews with the value chain workers, community and non-
governmental organizations. An audit plan is created annually based on the supplier
sustainability impact and risk assessment. In 2024, Outokumpu conducted 3 social audits
and 1 human rights impact assessment. (S2-2-22-(b))
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Financial year 2024
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Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Responsibility and oversight
The information on accountability and responsibility for human rights in Outokumpu is
disclosed in this chapter in the Policies section under “Accountability, availability and
stakeholders.” Significant deviations or findings from these visits are reviewed with the
Head of Raw Materials and, if necessary, escalated to the CFO, the group Sustainability
team, and the CEO for decision-making. (S2-2-22-(c))
Global framework agreements
Outokumpu has not made a global framework agreement with any global union federation.
(S2-2-22-(d))
Assessment of engagement effectiveness
In terms of how effectiveness of engagement with chain workers is assessed, based on
findings during on-site audits and assessments, improvement actions are agreed together
with the supplier. Outokumpu then follows the progress of actions by keeping regular
contact with the supplier. In severe cases, re-audit can be executed to validate actions. In
2024, 26 actions were agreed. (S2-2-22-(e))
Interviewees for audits and assessment are selected based on the potential to encounter
negative impacts and to ensure inclusion of the perspectives of those who are particularly
vulnerable to such impacts or marginalized (for example, female workers, workers in menial
tasks, immigrant workers). (S2-2-23)
In addition to the current management processes focused on upstream value chain,
Outokumpu is developing a general process to ensure interaction with various types of
stakeholders affected by its operations during 2025. (S2-2-24)
Processes for remediating negative impacts on
value chain workers
Description of processes and channels
In terms of remedy, each incident is dealt with on a case-by-case basis, and as yet, there is
not a group-level remedy process. More information about Outokumpu’s remedy process
development can be found in the Own work force (S1) chapter, in the Processes section
under “Remedy”. (S2-3-27-(a)),
On specific channels to raise concerns for value chain workers, more information can be
found in the Own workforce (S1) chapter, in the Processes section. In addition, in relation to
workers in the value chain, Outokumpu’s website contains contact details of key persons
responsible for sustainability, and supplier sustainability. The company representatives also
provide their contact details to upstream value chain workers during onsite audits and
assessments, for further questions or reporting any concerns. (S2-3-27-(b))
With regard to value chain workers, the Outokumpu Supplier Code of Conduct states that
the supplier shall ensure that its employees and stakeholders have an opportunity to raise
concerns through appropriate channels. In the Raw Materials Supplier Requirements it is
further stipulated that Outokumpu expects its suppliers to have or work towards having a
grievance mechanism. Additional information on the processes by which Outokumpu
supports the availability of channels to raise concerns related to its own operations and
value chain can be found in the Own workforce (S1) chapter in the Processes section.
(S2-3-27-(c))
Outokumpu monitors and tracks its own channels, including SpeakUp and the ESG incident
management system, but for the time being does not collect data from upstream value
chain actors. Outokumpu has not yet comprehensively discussed with the value chain
workers about the effectiveness of the channels. (S2-3-27-(d))
Assurance of awareness and protection
As to how value chain workers are aware of and trust the structures and processes as a way
to raise their concerns or needs and have them addressed, Outokumpu does not currently
have an approach in place. It is stated in both the Supplier Code of Conduct and the Raw
Materials Supplier Requirements that Outokumpu does not tolerate retaliation against any
individual who reports a concern in good faith. The company also highlights to its suppliers
during assessments that no retaliation against interviewed workers or communities will be
tolerated. Outokumpu also has a Reporting Misconduct Instruction, which includes a
section on protection against retaliation. (S2-3-28)
Disclosure of adoption
Outokumpu has identified the need to develop its approach to providing various types of
grievance mechanisms, as the stakeholders’ circumstances and possibilities to use
Outokumpu’s existing whistleblowing channel SpeakUp might be limited. Outokumpu will
start to develop its grievance process further during 2025. (S2-3-29)
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Actions and resources
Action on material impacts on value chain workers
Key actions, scope, and time horizon
Key actions taken in the reporting year
Updated Supplier Code of Conduct: Outokumpu revised its Supplier Code of Conduct to
integrate clearer social and sustainability standards, with an emphasis on labor rights and
human rights. This update aims to encourage suppliers on all sourcing categories to embed
sustainability into their core operations. The expected outcome of these updates is an
improvement in working conditions and ethical practices throughout the value chain. The
long-term target is that 100% of the targeted suppliers will be committed to Outokumpu’s
Supplier Code of Conduct.
Value Chain Mapping and Risk Assessment: Outokumpu conducted upstream value chain
mapping along with impact and risk assessments to identify high-risk sourcing categories
and the most significant potential negative impacts on value chain workers. By leveraging
these assessment outcomes, Outokumpu aims to enhance preventive and mitigating
actions to better manage identified risks and impacts.
Refined Impact Assessment Criteria: Outokumpu refined the criteria used for human
rights and environmental impact assessments to support value chain impact and risk
assessments as well as supplier on-site assessments. The updated criteria aim to enable a
broader and more precise evaluation of worker-related impacts across the value chain.
Continued On-Site Assessments: On-site assessments remained a key action for managing
material human rights and other sustainability impacts. In 2024, Outokumpu conducted
three social audits and one human rights impact assessment. These assessments aim to
address human rights impacts at the site, within the supplier’s operations and across their
supply chains, resulting in agreed actions to mitigate identified risks.
Human Rights Impact Assessment: Based on Outokumpu’s supply chain due diligence
process, a human rights impact assessment was conducted for a supplier in Mexico. The
objective was to evaluate the maturity of their human rights management processes,
identify potential impacts and gain better understanding on the industry and country
context. In collaboration with a third-party expert, Outokumpu facilitated discussions with
various stakeholders. These included communities, NGOs, former workers, employees,
management, workers' councils and subcontractors. The third-party expert prepared an
assessment report, and Outokumpu provided recommendations to improve the supplier’s
human rights due diligence practices.
Social Audits in Brazil: Three social audits were conducted on suppliers in Brazil, one of
which was a re-audit to assess the progress of previously agreed actions. Topics assessed
included e.g. working conditions in mining operations and wages.
Key actions planned for coming years
Expanding Value Chain Analysis Beyond Direct Suppliers: Outokumpu plans to analyze
the upstream value chain in selected additional sourcing categories to deepen its
understanding of impacts beyond direct suppliers. This effort builds on previous value chain
mapping and aims to identify human rights risks and impacts in less visible parts of the
value chain. The expected outcome is to address, prevent, and mitigate these impacts
effectively, leading to improvements in working conditions and ethical practices within
these areas.
Heightened Focus on Grievance Mechanisms and Remedy: Outokumpu will develop its
grievance and remedy processes during 2025, covering its own workforce, value chain
workers and affected communities. Expected outcome is to get better visibility in potential
and actual human rights infringements and enable to address, prevent and mitigate the
negative impacts related to Outokumpu’s own workforce, value chain workers and affected
communities. (S2-MDR-A-68-(a)), (S2-MDR-A-68-(b)), (S2-MDR-A-68-(c))
In 2024, Outokumpu has not identified any incidents in the supply chain where it would
have caused or contributed to an actual impact. There has been no action to provide or
enable remedy in relation to impacts that were identified on a general level in the double
materiality assessment. (S2-MDR-A-68-(d),(e)), (S2-4-32-(b))
Preventing, mitigating or remediating material negative impacts
To prevent, mitigate and remedy material negative impacts on value chain workers,
Outokumpu applies a due diligence approach. The process covers analyzing both actual and
potential negative impacts across all stages of supplier management, from the onboarding
of new suppliers to regular evaluations and assessments throughout the partnership.
The country-level risk assessment is one key tool for supplier and supply chain impact and
risk mapping. The assessment is based on the supplier’s operating countries and country
risk indices for trade sanctions, conflicts, state of the law, human rights, and the
environment. Additionally, suppliers are assessed against, for example, available
certifications, previous audit results, self-assessments such as EcoVadis, and overall
performance scorecard results. Based on these indicators, suppliers are selected for on-site
reviews. Those reviews vary from on-site visit with a sustainability focus, to a social audit, or
to a human rights impact assessment, depending on the identified impacts and risks. If a
supplier fails to meet Outokumpu’s requirements at any stage, Outokumpu may terminate
the contract and/or exclude the supplier from future business opportunities. (S2-4-32-(a)
During 2024, Outokumpu continued capacity building on human rights related to value
chain workers, and the supplier sustainability team has attended advanced training
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Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
courses. The team has been engaged in supporting the human rights of value chain
workers, through sustainability-focused meetings and speaking at trade shows and
seminars. Internal training in various topical subjects has been given to category managers
and buyers, such as on sanctions, impact and risk assessment, supplier performance
evaluation, and the audit process. (S2-4-32-(c))
Cases in which Outokumpu has audited or assessed suppliers and aligned the next steps
with them, the company stays in close contact with them in order to follow-up on the status
of the improvement actions. (S2-4-32-(d))
Identification process
Outokumpu applies an impact and risk-based approach in its supplier management stages.
Country-level risk assessment is one key tool for supplier and supply chain risk mapping
and this process is described in more detail in Preventing, mitigating and remediating
negative material impacts. Risks and possible impacts are also identified and assessed
according to, for example, available certifications, previous audit results, self-assessments
such as EcoVadis, and overall performance scorecard results as well as previous on site
visits, social audits, and human rights impact assessments. Identified non-conformities and
improvement areas are discussed with the suppliers. Needed actions are agreed and
followed up.
In addition, ESG incident management process is used to identify needed actions. Any
incidents in the upstream value chain are defined, identified, managed, and documented by
the Procurement organization. The process includes desktop research, potential purchasing
stops and decisions about on-site assessments or a human rights risk assessment. The
process includes also defining Outokumpu’s attribution to the identified impacts and
improvement actions, internal and external stakeholder information, and documentation of
the case. More information on audits and assessments as well as incidents, can be found
previously in this chapter under “Key actions.” (S2-4-33-(a))
Approach to taking action
To address especially the material negative impacts on workers in its value chain,
Outokumpu requires its suppliers to adhere to international labor and human rights
standards through its Supplier Code of Conduct and Raw Materials Supplier Requirements.
To further evaluate, prevent and mitigate the impacts, these topics are also covered as part
of the social audits and human rights impact assessments Outokumpu conducts in its
supply chain. In case of observed deficiencies, improvement actions are required from the
supplier, respectively.
Based on the self-assessments, site visits and audits, the identified non-conformities and
improvement areas are discussed with the suppliers, and needed actions are agreed and
followed upon. (S2-4-33-(b))
In terms of enabling and providing remedy, each suspected incident is currently dealt with
on a case-by-case basis as the group-level process for remedy is currently under
development. More information about Outokumpu’s remedy process development can be
found in the Own workforce (s1) chapter, in the Processes section under “Remedy”
(S2-4-33-(c)
Addressing material risks and opportunities
Mitigating material risks
To mitigate material risks and negative impacts, Outokumpu continues to develop its
remedy process as well as unify supplier management and onboarding processes. In
addition, business risk and sustainability impact management including performance
evaluation in all supplier categories will be further developed. Training for all procurement
personnel will be provided on following the processes and other new ways of working to
ensure a harmonized approach in supplier management. The work on monitoring supply
chain sustainability and impacts on value chain workers continues, for example, through
regular desktop reviews and sustainability audits.
Outokumpu will release and implement the renewed Supplier Requirements in selected
upstream value chain sectors. The long-term goal is to have 100% of targeted suppliers
commit to Outokumpu’s Supplier Code of Conduct and Raw Materials Supplier
Requirements.
In addition to identified material risks, Outokumpu anticipates the continuous evolution of
regulations related to supply chain transparency, ethical sourcing, and environmental
impact. Outokumpu’s plan involves staying informed of these changes and proactively
adapting its practices to align with emerging legislation. (S2-4-34-(a))
Pursuing material opportunities
Outokumpu continues to foster material opportunities for value chain workers by promoting
high social standards across its supply chain. Outokumpu believes this approach
strengthens the company's reputation and ESG performance and, in addition, enhances its
attractiveness as an employer and business partner.
In 2024, Outokumpu updated its Supplier Code of Conduct to incorporate clearer social
and sustainability standards, with a particular focus on labor rights and human rights. By
encouraging suppliers to adopt these standards, Outokumpu aims to drive improvements in
working conditions and ethical practices across the value chain. This approach puts
positive pressure on suppliers to integrate sustainability into their core operations,
potentially opening new business opportunities and revenue streams for Outokumpu.
Additionally, by requiring suppliers to align with these elevated standards, Outokumpu
strengthens the resilience of its supply chain, enabling greater stability and long-term
success. These efforts can further enhance Outokumpu’s reputation as a socially
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Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
responsible company and can position Outokumpu as an attractive partner in the
marketplace, helping it pursue future growth opportunities. (S2-4-34-(b))
Avoiding negative impacts
As sustainability is a core value for Outokumpu, human rights are not compromised, and
the company strives to avoid any negative impacts concerning its own operations and value
chain. A potential raw material supplier is qualified before they can be approved and added
to the Outokumpu supplier portfolio. In the qualification process, the potential impacts,
risks and/or opportunities related to the supplier are identified and evaluated. The
identification of impacts and risks follows Outokumpu’s Know Your Business Partner
Instruction and utilizes country-level sustainability and compliance risks indices. The
onboarding process of suppliers with a high-risk profile ensures the supplier commits to
complying with the Outokumpu Supplier Code of Conduct and Raw Material Supplier
Requirements and can provide confirmed raw materials, products, or services on a
consistent basis. All new suppliers go through compliance screening for trade sanctions
before any business is initiated. (S2-4-35)
Reporting human rights issues
There were no severe cases reported for workers in the value chain in 2024. (S2-4-36)
Resource allocation to manage material impacts
In 2024 Outokumpu’s supplier sustainability management team consisted of four full-time
employees dedicated to upstream value chain sustainability impact and risk identification
and management. In addition, the company used external experts to support value chain
worker engagement, supplier audits and monitoring corrective actions. Outokumpu has
included financial planning for supplier sustainability as part of its procurement financial
planning. (S2-4-38)
Metrics and targets
Targets related to workers in the value chain
Outokumpu has no quantified targets in place for upstream value chain workers currently.
(S2-MDR-T-81-(a)), However, Outokumpu has set operational targets for measuring and
improving the sustainability performance of its suppliers. The target is to increase the
number of sustainability-rated suppliers and execute planned on-site assessments. Also the
progress on corrective action plans is monitored. (S2-MDR-T-81-(b)) There is also an
operational target to increase the share of suppliers that commit to respecting and
protecting the rights of value chain workers by signing the Outokumpu Supplier Code of
Conduct. Additionally, the share of suppliers that have signed the Raw Materials Supplier
Requirements was monitored. (S2-MDR-T-81-((b)-(i))
Material impacts and risks in the upstream value chain, identified in the double materiality
assessment in 2023, were addressed through various actions implemented in 2024. The
effectiveness of policies and actions in mitigating the negative impacts and risks will be
assessed when the double materiality assessment is updated in 2025. (S2-MDR-T-81-(b)) In
addition, Outokumpu is evaluating qualitative and quantitative indicators in the future for
tracking progress on impacts, risks and opportunities related to its value chain workers. (S2-
MDR-T-81-((b)-(ii)))
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
§
S3 – Affected communities
Affected communities were identified as material for Outokumpu in its double
materiality assessment.
Material impacts, risks and opportunities resulting from
the materiality assessment
S 3.1 Affected communities
Impacts
Positive
Outokumpu’s positive impacts are based on supporting the economic and social
development of local communities for example through financial contributions (e.g.
paying taxes, providing sponsorship and donations) and various forms of cooperation
with local actors (e.g. educational institutions and civil society organizations). These
are actual impacts valid in Outokumpu’s own operations.
In addition, Outokumpu’s positive impacts on affected communities are related to
promoting and ensuring respect for human rights and the environment. This includes
improving living and working conditions as well as supporting civil and political rights
of the local communities and their right to a clean and healthy environment. These
are actual impacts valid in the upstream value chain.
Negative
Outokumpu’s negative impacts relate to the local natural and living environment, for
example through production-related emissions and transportation logistics. Negative
impacts on local economic and social welfare may be caused through restructuring or
closure of operations. These are potential impacts valid in Outokumpu’s own operations.
In addition, Outokumpu’s negative impacts on affected communities are related to non-
respect of human rights especially with regard to indigenous peoples, such as loss or
degradation of traditional lifestyles and resettlement of communities. The negative
impacts can also be environmental such as loss of biodiversity and other damages
caused by mining activities. These are actual impacts valid in the upstream value chain.
Risks and
opportunities
Opportunity
The main opportunities are related to establishing a robust human rights due
diligence process. This may lead to more resilient supply chains, decreasing costs and
reputational benefits to Outokumpu. It may also improve the company’s ranking in
various ESG performance ratings, attracting increased attention from investors and
leading to more favorable financial terms. These opportunities are valid in both
Outokumpu’s own operations and the upstream value chain.
Risk
Main risks are related to delays in or stoppages of the company’s own or it’s suppliers
or other business partners’ projects and fines or other mitigation or remediation costs
in the case of environmental or human rights incidents related to affected
communities. These may also be a source of reputational risk that may affect
Outokumpu’s financial performance. These risks are valid in both Outokumpu’s own
operations and in the upstream value chain.
(ESRS 2-SMB 3-48-(a))
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138
As a company with a global value chain,
Outokumpu has direct and indirect impacts on
people locally, nationally and globally. The
company is committed to respecting the human
rights of all those communities that may be
affected by the company’s own operations or
through its business relationships.
PLAN 2025
In-depth identification of
affected communities and
related salient impacts, risks
and opportunities with special
focus on indigenous peoples.
Policy updates to manage
material impacts, risks and
opportunities related to
various types of affected
communities.
Development of engagement
methods, grievance
mechanisms and remedy
process.
Further elaboration of the
sustainability due diligence
process to define actions and
targets.
KEY ACTIONS in 2024
Establishing Outokumpu’s
sustainability due diligence
process for own operations
and value chain including
affected communities.
Completed gap analysis and
action plan for sustainability
due diligence process
development.
Continued commitment to and
implementation of
international frameworks
related to affected
communities such as UNGPs,
ResponsibleSteel and Towards
Sustainable Mining Finland.
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Strategy
Material impacts, risks and opportunities related to
affected communities and their interaction with
strategy and business model
Interaction with the strategy and business model
Most of the impacts related to Outokumpu’s affected communities are based on the
characteristics of Outokumpu’s main activities, stainless steel production and mining.
These operations require skillful workforce, are regulated and permit-based and require
production inputs from global supply chains. (ESRS 2-S3-SBM-3-8-(a)-(i))
Outokumpu’s own operations are location-based and have been established in existing
locations for a longer time. The company has positive impacts on the affected communities
by contributing to the local economic and social welfare (providing jobs, paying taxes, giving
sponsorships and donations). Outokumpu’s negative impacts are reflected in natural and
living environment of the affected communities through the manufacturing processes of
physical end-products, such as local emissions transportation logistics. Also the
restructuring of operations may have negative impacts on the local economic and social
welfare. (ESRS 2-S3-SBM-3-8-(a)-(i))
Outokumpu’s raw material availability is tied to their geographical occurrence.
Consequently, sourcing is done also from countries and regions with identified human rights
risks that concern not only value chain workers but also local communities. Outokumpu has
positive impacts by promoting and ensuring respect for human rights and the environment
in these communities. Respectively, negative impacts on affected communities are
manifested as non-respect of human rights and environmental damage with special focus
on indigenous peoples’ rights. (ESRS 2-S3-SBM-3-8-(a)-(i))
The affected communities related to both Outokumpu’s own operations and value chain
upstream contribute to ensuring business continuity. Steering own operations locally in
cooperation with respective communities is important in ensuring legal and social license
to operate and the availability of skillful workforce, among others. For affected communities
in the value chain upstream, developments related to human rights and the state of the
local ecological environment impact the stability of supply chains and reliability of raw
material availability. Securing the supply chain resilience especially for key raw materials in
high-risk societies and countries feeds into strategy and business model considerations.
((ESRS 2-S3-SBM-3-8-(a)-(ii))
Consequently, affected communities and respective local circumstances inform for their
part the strategy and business model development at Outokumpu in minimizing related
risks and identifying opportunities. However, this linkage is not currently based on any
general Group-wide approach. Therefore, the interaction between affected communities and
Outokumpu’s strategy and business model is one of the identified topics that will be further
evaluated as part of global stakeholder engagement process development in 2025. For
more information, see section Interest and views of stakeholders (ESRS 2 SBM-2) under
Strategy. (ESRS 2-S3-SBM-3-8-(b)
Outokumpu acknowledges the varying degrees of impacts on different community groups.
However, Outokumpu does not currently have a general corporate-level approach to
systematically identify all affected communities who can be materially impacted by its own
operations or in its value chain. The company is currently developing its sustainability due
diligence process to cover these aspects. Related gap analysis and action plan to define
further actions were completed in 2024. Developing a general approach to ensure
identification of all affected communities that can be materially impacted by Outokumpu’s
operations will be part of this action plan for 2025. This process is also linked to the
general development of stakeholder engagement at Outokumpu based on the requirements
in ESRS 2 SBM-2. (S3-ESRS 2 SBM-3-9)
Types of communities
As stated above, Outokumpu is in the process of developing a general approach and
establishing a related process to ensure all affected communities are identified and
described. On a general level, it can be stated that the communities affected by
Outokumpu’s operations are: (S3-ESRS 2 SBM-3-9-(a))
•
communities living or working around Outokumpu's own operating sites or more remote
communities affected by activities at those sites
•
communities along Outokumpu’s upstream value chain, where metals and minerals
mining and processing activities are conducted
•
communities at one or both endpoints of the value chain, for example, at the point of
extraction of metals or minerals
•
communities of indigenous peoples along Outokumpu’s upstream value chain where
metals and minerals mining and processing activities are conducted.
(S3-ESRS 2 SBM-3-9-(a)-(i-iv))
Material negative impacts
Outokumpu’s material negative impacts on the environment or human rights may affect
communities around its own operations or along the value chain. Outokumpu is currently
developing its sustainability due diligence process based on a gap analysis conducted in
2024 with a related action plan. A structured mapping of these impacts based on how
widespread or systemic they are, or if they are related to individual incidents is part of this
development process.
Following the development of the sustainability due diligence process covering its own
operations and value chain, Outokumpu will also evaluate the occurrence of the material
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negative impacts on various affected communities as a part of the impact assessment and
prioritization to identify and categorize the most salient impacts. (S3-ESRS 2 SBM-3-9-(b))
Material positive impacts
In Outokumpu’s own operations, the positive impacts on affected communities are based
on supporting the economic and social development of local communities, for example
through paying taxes or providing sponsorship for specific initiatives and purposes.
Outokumpu also supports local communities via cooperation with schools, among other
things. For the affected communities in Outokumpu’s upstream value chain, the positive
impacts may be focused on supporting human rights initiatives and promoting good human
rights practices, providing training, and increasing awareness as well as enhancing
inclusion. As yet, there is no systematic approach to initiate and evaluate these activities
that aim at resulting in positive impacts to cover all or specific affected communities.
There are two distinct approaches to the communities affected by Outokumpu:
1. communities close to and directly affected by Outokumpu’s own operations (sites)
located in economies and societies with widely established and robust legislation on the
environment and human rights in place, and
2. communities along the value chain indirectly affected by Outokumpu’s operations,
mainly upstream supply chains related to raw material procurement (especially in
countries of high risk and less-established legal requirements on the environment and
human rights).
The elements to cover from an impact, risk and opportunity perspective vary between these
two approaches mainly due to different type of societies. Accordingly, Outokumpu’s
possibilities and means to use leverage to have an impact varies as well, being bigger in
the local communities in which Outokumpu operates, compared to the more complex and
geographically more widely spread supply chains. (S3-ESRS 2 SBM-3-9-(c))
Risks and opportunities
Outokumpu is developing a more systematic approach to identify and evaluate the material
risks and opportunities that arise from the impacts and dependencies on its affected
communities. For the moment, there is not such an approach, but the development of
Outokumpu’s sustainability due diligence process will enable the company to have a more
structured view on managing these impacts and dependencies as well as to identify the
related risks and opportunities. Through this process, Outokumpu will also evaluate the
need to introduce and maintain social dialogue with its affected communities to support
these efforts. (S3-ESRS 2 SBM-3-9-(d))
Understanding potential greater risks
Outokumpu will develop procedures for defining and identifying affected communities with
particular characteristics, living in particular contexts or undertaking particular activities
with related greater risk of harm as part of its sustainability due diligence process
development in 2025 and onwards. As yet, there is no such structured approach covering
Outokumpu’s own operations and value chain that would allow the company to develop a
systematic understanding of the matter. (S3-ESRS 2 SBM-3-10)
Specific groups related risks and opportunities
Outokumpu will also develop a structured approach for systematic mapping and
understanding of specific groups among affected communities, as currently no such
procedure exists. This will be part of the further development the company’s sustainability
due diligence process in as defined in the related action plan for 2025 and onwards.
(S3-ESRS 2 SBM-3-11)
Impact, risk and opportunity
management
Policies
Policies related to affected communities
Outokumpu’s work on human rights due diligence, including engagement with affected
communities, is based on the company’s Human Rights Policy. Other supporting policies
include the Sustainability Policy, disclosed in the Climate change chapter (E1), the Code of
Conduct, disclosed in the Governance chapter (G1), and the Supplier Code of Conduct with
the related Raw Materials Supplier Requirements, disclosed in the Workers in the value
chain chapter (S2). Outokumpu started to develop its group-wide sustainability due
diligence process on human rights and environment in 2024. The scope covers both its own
operations and value chain and is based on Outokumpu’s previous work on human rights
due diligence according to UNGPs. During 2024, a human rights impact assessment for
own operations was conducted, and a gap analysis and action plan to develop the
sustainability due diligence process further were completed. Actions for 2025 include
reviewing and, if required, updating the policies to manage material impacts, risks and
opportunities related to affected communities, including specific affected communities.
(S3-1-14)
Key contents of policy
Outokumpu’s Human Rights Policy describes the main principles and rules followed by
Outokumpu Group in relation to respecting and protecting human rights. It covers
Outokumpu’s main principles on human rights, explaining the company’s general
commitment, as well as the most salient human rights and the related principles. These
include the UN Universal Declaration of Human Rights; the International Covenant on Civil
and Political Rights; the International Covenant on Economic, Social and Cultural Rights;
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the European Convention on Human Rights, the International Bill of Human Rights as well
as the United Nations Global Compact of which Outokumpu is a signatory member.
It also describes Outokumpu’s commitment to the UN Guiding Principles on Business and
Human Rights (UNGPs), and how it undertakes a human rights due diligence process based
on the UNGP framework. (S3-MDR-P-65-(a))
Scope and accountability
The Human Rights Policy must be followed globally by all Outokumpu businesses,
companies, directors, officers, and employees. (S3-MDR-P-65-(b)) The CEO has the most
senior level of oversight and accountability for human rights at Outokumpu. Responsibilities
cascade down via the Executive Vice President - Strategy, Sustainability and People, who
represents sustainability in Outokumpu’s Leadership Team, to the Vice President -
Sustainability, who is responsible for the overall sustainability agenda at Outokumpu, and
further to the Head of Human Rights in the Group sustainability team.The Human Rights
Policy is approved and signed by the Executive Vice President – Strategy, Sustainability and
People. (S3-MDR-P-65-(c))
Third-party standards
Through the Human Rights Policy, Outokumpu respects and takes into account the following
third-party standards and initiatives to evaluate and manage risks and impacts: the UN
Guiding Principles on Business and Human Rights (UNGPs), the International Labor
Organization’s Declaration on Fundamental Principles and Rights at Work, the Convention
on the Rights of the Child and the Declaration on the Rights of Indigenous Peoples.
Outokumpu's manufacturing operations in Europe are certified according to the
ResponsibleSteel standard and mining operations in Kemi, Finland, according to the
Towards Sustainable Mining Finland scheme. Both standards have requirements on
stakeholder engagement and local community engagement. ResponsibleSteel includes
additional requirements on human rights due diligence, covering also workers in the value
chain. (S3-MDR-P-65-(d))
Stakeholders and availability
Outokumpu collects views from stakeholders through various channels that have an
influence on how the company sets its policies. Outokumpu is in the process of developing
a group-wide approach on stakeholder engagement, including affected communities,
supporting company’s sustainability due diligence process development. More information
on the work on stakeholder engagement at Outokumpu can be found in the General
information chapter (ESRS 2 SBM-2). (S3-MDR-P-65-(e))
Outokumpu’s Human Rights Policy and supporting policy documentation, the Code of
Conduct, Sustainability Policy and Supplier Code of Conduct, are publicly available on the
company’s website and also communicated to the company’s external stakeholders on
different occasions. They are also available internally to all Outokumpu employees.
(S3-MDR-P-65-(f))
Policy provisions and indigenous peoples
Preventing and addressing impacts on indigenous peoples is based on Outokumpu’s Human
Rights Policy, Sustainability Policy, Code of Conduct and Supplier Code of Conduct, with
related Raw Materials Supplier Requirements. As stated in the Human Rights Policy,
Outokumpu is committed to and expects all its business partners, suppliers, sub-suppliers,
and customers to protect the rights of indigenous peoples as laid out in the Indigenous and
Tribal Peoples Convention, 1989 (No. 169) and the UN Declaration on the Rights of
Indigenous Peoples. These rights include, but are not limited to, their right to land and their
right to free, prior, and informed consent (FPIC) when exploration or exploitation of
resources of their lands is permitted or undertaken. Both provisions are also mentioned in
Outokumpu’s Sustainability Policy. Respecting and promoting indigenous people’s rights is
also mentioned in the company’s Supplier Code of Conduct. (S3-1-15)
Human rights policy commitments to affected communities
Outokumpu’s Human Rights Policy commitments relevant to affected communities are
listed in the Human Rights Policy earlier in this chapter, under “Key contents of
policy.” (S3-1-16)
General approach to respecting human rights of communities and
indigenous people specifically
Outokumpu’s general approach in relation to respect for human rights of communities, and
indigenous peoples specifically, are based on Outokumpu’s Human Rights Policy
commitments relevant to affected communities and international human rights
commitments listed above. Outokumpu is also committed to and also expects all its
business partners, suppliers, sub-suppliers, and customers to protect the rights of
indigenous peoples as laid out in the policy provisions listed above. (S3-1-16-(a))
General approach to engaging with affected communities
Outokumpu’s general approach in relation to engagement with affected communities is
based on its Human Rights Policy, Sustainability Policy, Code of Conduct and Supplier Code
of Conduct with related Raw Materials Supplier Requirements. Outokumpu does not
currently have a documented corporate-wide approach on engaging specifically with
affected communities. (S3-1-16-(b))
As to a general approach to providing and/or enabling a remedy for human rights impacts,
more information is in the Own workforce (S1) chapter, in the Policies section, under
“Remedy for human rights impact.”(S3-1-16-(c))
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Tracking and monitoring cases of non-respect
Outokumpu does not currently have a corporate-wide process in place to track and monitor
cases of non-respect of UNGPs, the ILO Declaration on Fundamental Principles and Rights
at Work or OECD Guidelines involving affected communities. Such a process together with
policies and relevant instruments, will be developed as part of Outokumpu’s sustainability
due diligence process development in 2025, covering its own operations and value chain.
For the reporting period, there has been one reported case of non-respect of these
guidelines in Outokumpu’s own operations. Outokumpu understands the meaning of “a
case of non-respect” as a situation in which a severe human rights impact, such as a
fatality, has happened despite the human rights due diligence process and/or other
measures based on the aforementioned frameworks. More information can be found in
disclosures regarding the company’s own workforce (S1) chapter, under “Incidents,
complaints and severe human rights impacts.” (S3-1-17)
Policy documentation, cross-reference and updates
During the reporting year, no significant changes were adopted to the policies related to
managing Outokumpu’s material impacts on affected communities or the associated
material risks and opportunities. The relevant policies for affected communities, namely the
Human Rights Policy, Sustainability Policy, Code of Conduct and Supplier Code of Conduct,
were reviewed during 2024 with only minor or no changes.
As Outokumpu is developing its sustainability due diligence process to cover its own
operations and value chain, updating the policies to the extent required will be part of
actions defined for 2025. (S3-1-AR-9)
Processes
Processes for engaging with affected communities
about impacts
On engagement with affected communities
Outokumpu is currently developing a sustainability due diligence process to cover its own
operations and value chain, also taking into account systematic engagement with affected
communities. Developing a group-wide approach to engage with the affected communities
will be part of this action plan for 2025. However, Outokumpu has local activities with
affected communities close to its production sites even now. More information on the
development of stakeholder engagement at Outokumpu can be found in General
information (ESRS 2 SBM-2). (S3-2-24)
Processes to remediate negative impacts
and channels for affected communities
to raise concerns
Remedy and channels for raising concerns
More information about Outokumpu’s general approach to and processes for providing or
contributing to a remedy when the company has identified that it is connected with a
material negative impact on affected communities is in the Own work force (S1) chapter, in
the Processes section, under “Remedy”. (S3-3-27-(a))
More information about specific channels to raise concerns is the Own workforce (S1)
chapter, in the Processes section, under “Grievance mechanisms.” In addition, in relation
to affected communities, Outokumpu’s local operations and Group functions can be
contacted via email or phone. (S3-3-27-(b))
More information on the processes by which Outokumpu supports the availability of
channels to raise concerns related to its own operations and value chain, can be found in
the Own workforce (S1) chapter, in the Processes section. In addition, Outokumpu will
evaluate the need to define means to support such channel availability by its business
relationships as part of the sustainability due diligence process development.(S3-3-AR-19),
(S3-3-27-(c))
Tracking and monitoring of concerns
More information on how issues raised and addressed are tracked and monitored and how
effectiveness of these channels is ensured is in the Own workforce (S1) chapter, in the
Processes section, under “Grievance mechanisms.”(S3-3-27-(d), S3-3-29)
Awareness and trust in the remedy structures
Outokumpu has a policy to protect against retaliation for individuals that use channels to
raise concerns. More information can be found in the Governance section under “Protecting
whistleblowers.” Regarding how the affected communities are aware of and trust the
existing structures and processes as a way to raise their concerns or needs and have them
addressed, Outokumpu is developing its processes to address these aspects.
Outokumpu has evaluated the awareness of it’s whistleblowing channel SpeakUp during the
ResponsibleSteel audits for its European operations by means of sample interviews with
the local community representatives. The conclusion was that the channel is not known
well enough among these stakeholders. Outokumpu will continue to define procedures to
increase affected communities’ awareness of and trust in structures and processes as a
way to raise their concerns or needs. This will be done as part of the sustainability due
diligence process development. (S3-3-28)
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Third-party mechanisms
Outokumpu will also evaluate the need to introduce third-party grievance mechanisms to
ensure proper access globally to affected communities related to its own operations and
value chain. This evaluation will be conducted as part of Outokumpu’s sustainability due
diligence process development in 2025. (S3-3-AR-20)
Actions and resources
Action on material impacts on
affected communities
Outokumpu is currently developing a group-wide approach to define actions to address
material impacts on affected communities, including providing or enabling remedy. This
work is done as part of the sustainability due diligence process development at
Outokumpu, covering its own operations and value chain. S3-MDR-A-(62))
Incidents and issues
In 2024, there have been no reports of severe human rights issues or incidents connected
to the affected communities related to Outokumpu’s own operations or value chain.
Outokumpu is developing a group-level approach to identify systematically severe human
rights issues and incidents connected to the aforementioned communities during 2025.
Currently, if such cases emerge, they would be investigated case by case. Outokumpu
defines a severe human rights issue to mean, for example, loss of life, detention, adverse
health effects, malnutrition, loss of livelihood, human trafficking, forced labor, and/or child
labor. (S3-4-36)
Resource allocation
Outokumpu appointed a Head of Human Rights at Group Sustainability function during
2023 to establish a group-level framework for human rights. During 2024, the Head of
Human Rights in the Group Sustainability team and the Supplier Sustainability and Quality
team continued implementing Outokumpu’s work on human rights according to the UNGP
framework and started developing a sustainability due diligence process for Outokumpu’s
own operations and value chain. Besides using its own resources, the company also uses
external experts to assess and support the due diligence process development. No specific
allocated financial resources for mitigating material impacts exist, but this is included in
the Group functions financial planning as part of the company’s sustainability due diligence
implementation. The resource allocation for managing Outokumpu’s material impacts will
be further defined in 2025. (S3-4-38)
Metrics and targets
Targets related to affected communities
Outokumpu is currently developing further its sustainability due diligence process covering
its own operations and value chain. One of the focus areas of this work are Outokumpu’s
impacts on various affected communities as well as related actions to prevent, mitigate
and bring these impacts to an end. Consequently, no group-wide targets have been defined
for this purpose yet but setting such targets will be evaluated as part of the due diligence
process development during 2025. (S3-ESRS-2-72) (S3-MDR-T-81-(a))
Elaborating on practices and processes on how to track the effectiveness of policies and
actions related to the identified impacts will also be part of this ongoing development work.
For evaluation of the actions and policies regarding risks and opportunities, a similar
approach will be defined in unison, even if these aspects are not directly included in the
sustainability due diligence process. During 2025, Outokumpu will also assess the need to
establish selected qualitative and/or quantitative indicators when developing further the
sustainability due diligence process. (S3-MDR-T-81-(b), (b)-(i), (b)-(ii))
Nevertheless, Outokumpu has already now certain practices in place to track the
effectiveness of its policies and actions related to the impacts, risks and opportunities
concerning affected communities. For example, Outokumpu is committed to global
initiatives such as UN Global Compact and the UN Guiding Principles on Business and
Human Rights. Together with the UN Sustainable Development Goals, they provide a
general framework for setting targets and defining the company’s actions towards the
various affected communities. Outokumpu’s European operations are ResponsibleSteel-
certified, and its mining operations in Finland follow the Towards Sustainable Mining
Finland standard. In addition, environmental and social aspects related to affected
communities are included in various internal audit and evaluation schemes as well as in
the supply chain due diligence process. The need to elaborate these aspects further in the
existing internal management tools will also be considered in 2025. (S3-MDR-T-81-(b)-(i))
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Outokumpu’s governance work enhances
business conduct and corporate culture.
Outokumpu is committed to conducting
business with high integrity. This means
conducting business in an ethical and
responsible way. Outokumpu believes that
every employee has a role in making
ethical choices that help to build a world
that lasts forever.
G1-1 - Business conduct and corporate culture
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G1–1 Business conduct
policies and corporate
culture
Business conduct policies and corporate culture was identified as material for Outokumpu
in its double materiality assessment.
Material impacts, risks and opportunities resulting from
the materiality assessment
G1-1 Business conduct policies and corporate culture
Impacts
Positive
Fostering a corporate culture that is anchored in transparency and ethical, responsible
and sustainable business practices offers employees a safe and welcoming place to
work and also enables them to raise concerns. Outokumpu’s commitment to conduct
business with high integrity also has a positive impact on other stakeholders of the
company. Furthermore, Outokumpu expects that its business partners follow similar
ethical standards as Outokumpu. These actual positive impacts concern the whole
value chain.
Negative
If Outokumpu fails to conduct business in an ethical and responsible manner and
maintain a corporate culture where every employee has a role in doing the right thing,
it can lead to non-compliant and unethical business practices. Non-compliant and
unethical business practices of Outokumpu’s business partners can also have
negative impacts on Outokumpu and its stakeholders. These potential negative
impacts concern the whole value chain.
Risks and
opportunities
Risk
Non-compliance with laws and regulations and the company’s business conduct
policies as well as other unethical behavior, can weaken the operations and result in
adverse legal, financial and reputational consequences for Outokumpu and its
stakeholders, impacting the whole value chain.
(ESRS 2-SMB 3-8-(a))
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Outokumpu is committed to conducting
business with high integrity. The company’s
Code of Conduct provides the principles and
rules that all employees need to follow and
commit to in their daily work. It guides the
employees by setting examples and giving
practical advice so that everyone is able to
make the right choices and conduct business in
an ethical and responsible manner.
TARGETS
Targeted completion rate of
the new Code of Conduct e-
learning
100%
including all employees,
administrative and operational
PROGRESS
Achieved completion rate of
the new Code of Conduct e-
learning by all employees
97%
Annual review
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Review by the Board of Directors
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General disclosures
Environmental information
Social information
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Auditor's Report and Assurance Report
Governance and remuneration
Impact, risk and opportunity
management
Policies
Policies related to business conduct
and corporate culture
Outokumpu has formulated policies that address the identification and management of the
company’s material impacts, risks, and opportunities related to business conduct matters.
At Outokumpu, the most important business conduct policy is the group-wide Code of
Conduct which is the core element of Outokumpu’s group-wide Ethics and Compliance
(E&C) program. The aim of the Code of Conduct is to ensure that all Outokumpu employees
live up to Outokumpu’s Ethical Principles, Ways of Working and act with high integrity.
Key contents of the policies
The Outokumpu Ethical Principles are part of the Code of Conduct and they are issued by
the Outokumpu Board of Directors. As per these principles, Outokumpu respects and
promotes human rights and conducts business in a safe, sustainable and ethical and
compliant manner. These key Ethical Principles guide how to act towards employees,
customers, other business partners and society at Outokumpu.
The Outokumpu Code of Conduct is structured based on the company’s Ways of Working.
These form the foundation for daily work at Outokumpu: we operate safely, always; we
leverage the power of One Outokumpu; we deliver; we value and grow people and diversity;
we act sustainably; and we are a trusted partner. These Ways of Working unite the company
and create a common understanding on how Outokumpu does business, treats people and
works towards a world that lasts forever.
The Code of Conduct provides the principles and rules that all employees need to follow
and commit to in their daily work. It guides the employees by setting examples and giving
practical advice so that everyone is able to make the right choices in their everyday work.
The Code of Conduct contains information about the following key areas: health and safety,
working together as one Outokumpu, responsible purchasing, protecting assets, information
and personal data, safeguarding insider information, communicating with external
audiences, corporate governance, avoiding conflicts of interest, financial integrity,
preventing money laundering, respectful employment practices, working conditions and
rights of employees, sustainable operations and co-operation with communities, anti-
corruption including using agents, consultants and distributors as well as reasonable gifts,
hospitality and travel expenses, knowing our business partners, competition law
compliance, responsibility to comply with the Code of Conduct, co-operation in audits and
investigations and raising concerns including information about Outokumpu’s SpeakUp
channel.
In addition to the Code of Conduct, there are other business conduct related policies and
instructions in place as part of Outokumpu’s operating principles framework, including
policies around the areas of health and safety, anti-corruption, know your business partner,
and data protection as well as competition law compliance. Furthermore, there is a Supplier
Code of Conduct and supplier requirements available for Outokumpu’s suppliers. Policies
and instructions, including the Code of Conduct, are implemented through training,
communications, and internal control activities. (G1-MDR-P-65-(a))
Scope and approval process
The Outokumpu Code of Conduct is applicable to all Outokumpu employees globally.
Outokumpu also expects that all its business partners follow similar ethical standards as
Outokumpu.
Outokumpu’s suppliers globally are expected to comply with the Outokumpu Supplier Code
of Conduct and supplier requirements. More information about the management of
suppliers can be found in the Workers in the value chain (S2) chapter. (G1-MDR-P-65-(b))
The Outokumpu Board of Directors determines Outokumpu’s Ethical Principles, which are
part of the Outokumpu Code of Conduct. The Outokumpu Ways of Working are determined
by the CEO and the Outokumpu Leadership Team, and the Outokumpu Human Resources
function facilitates their implementation. The CEO of Outokumpu approves and monitors
the implementation of the Code of Conduct. (G1-MDR-P-65-(c))
Third-party standards
As stated in the Code of Conduct, Outokumpu honors and is committed to the International
Bill of Human Rights, United Nations Global Compact, UN Guiding Principles on Business
and Human Rights and ILO Declaration on Fundamental Principles and Rights at Work.
(G1-MDR-P-65-(d))
Availability and implementation
Outokumpu’s Legal and Compliance function drives the implementation and further
development of the group-wide E&C program. Implementing the Outokumpu Code of
Conduct is facilitated by the Group Ethics and Compliance team and the Code of Conduct
and the related e-learning has been drafted in co-operation with internal stakeholders.
(G1-MDR-P-65-(e))
The Code of Conduct is available internally in eleven (11) languages. There is a dedicated
Code of Conduct page on the company’s intranet where the Code of Conduct and its
language versions can be found. There are also communication materials available related
to the Code of Conduct, such as posters that can be posted on the walls of Outokumpu’s
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sites globally. The English version of the Code of Conduct can also be found on
Outokumpu’s external website.
Outokumpu expects that its business partners follow similar ethical standards as
Outokumpu. In addition, Outokumpu expects that its suppliers globally comply with the
Supplier Code of Conduct and supplier requirements. Furthermore, training can be
organized for business partners on key ethics and compliance topics, as needed.
(G1-MDR-P-65-(f))
Establishing, developing, promoting and
evaluating the corporate culture
Outokumpu is committed to fostering a corporate culture that is anchored in transparency,
integrity and ethical, responsible and sustainable business practices. Outokumpu wants to
act as a reliable and trusted partner towards all its stakeholders, including customers,
employees, investors and the communities Outokumpu is operating in. Outokumpu’s
corporate culture is established and developed through the vision, the Outokumpu Code of
Conduct and other policies and commitments that are implemented through training,
communications and internal control activities. Outokumpu’s corporate culture is evaluated
regularly to ensure it aligns with the company’s commitment to conduct business with high
integrity, and fosters a safe and welcoming work culture.
Outokumpu’s vision is to be customer’s first choice in sustainable stainless steel.
Sustainability is an integral part of Outokumpu’s strategy making it an important element of
Outokumpu’s corporate culture. At Outokumpu ethical and compliant business practices
are at the heart of conducting a sustainable business where everyone can contribute by
making ethical and responsible choices as part of the daily activities at work.
Outokumpu has instituted robust business conduct policies that serve to guide the behavior
and operations of the company in an ethical and responsible manner. These policies are
embedded in the corporate culture, promoting responsible behavior at every level of the
organization.
Outokumpu is committed to complying with applicable laws and regulations, Ethical
Principles, the Outokumpu Code of Conduct and other company policies and instructions,
as well as Ways of Working, which form the basis of Outokumpu’s actions, operations and
corporate culture. Outokumpu’s Ways of Working unite the company and create a common
understanding and corporate culture on how the company does business and treat its
people.
At Outokumpu, safety takes priority over all other activities. This affects Outokumpu’s
corporate culture and emphasizes the importance of health and safety. Everyday actions at
work are based on Outokumpu’s safety principles. Outokumpu’s Cardinal Safety rules,
which are the fundament for instructions and standard operational procedures, ensure
strict compliance with the safety principles. Furthermore, Outokumpu is committed creating
a work environment where everyone feels safe and welcomed, regardless of their
background. Additionally, the company fosters a collaborative working culture, embracing
diversity, equity, and inclusion.
The business conduct policies are implemented through training, communications and
internal control activities. For Code of Conduct and related ethics and compliance matters
the Group Ethics and Compliance team conducts e-learning modules and other engaging
training and communications to help employees do the right thing. The senior management
of Outokumpu also has an important role in setting the tone from the top and
communicating the importance of ethical and compliant business practices. One example
of such communications is the monthly safety calls led by the CEO. These calls regularly
promote one of the key elements of Outokumpu’s corporate culture: health and safety.
Outokumpu’s policies and practices are regularly reviewed and updated to ensure that they
also account for more recent developments in the business environment. Business conduct
topics and how employees perceive the various elements of the company’s actions,
operations and corporate culture are also regularly evaluated and measured through
various means, such as through employee engagement surveys targeted at all employees.
There were two employee engagement surveys conducted in 2024. These surveys included
questions around the key themes of corporate culture – ethical behavior, health and safety,
diversity, equity, and inclusion as well as raising concerns.
At Outokumpu, integrity is part of the annual performance management process as part of
the evaluation of the core behaviors, highlighting the importance of complying with the
Outokumpu Code of Conduct and other policies, including Outokumpu’s health and safety
standards. For the administrative employees there is a reminder and consequence
management process in place for the mandatory ethics and compliance e-learning
modules. The process underlines the importance of completing the trainings on time –
everyone needs to do their own part in knowing the rules and doing the right thing.
Finally, Outokumpu is committed to fostering a corporate culture of speaking up. This
means that Outokumpu encourages all employees, business partners and other
stakeholders to raise concerns, if they suspect a violation of the Outokumpu Code of
Conduct or other misconduct. (G1-1-9)
Mechanism for reporting misconduct
Outokumpu aims to foster a transparent and open culture. The company encourages all
employees, business partners and other stakeholders to raise concerns, if they suspect a
violation of its Code of Conduct or other misconduct. Any activity that is against applicable
laws, regulations or Outokumpu’s policies, or any activity that can cause direct or indirect
financial or other damage to Outokumpu, its employees or other stakeholders, is
considered misconduct. Outokumpu employees are expected to protect Outokumpu’s
reputation, take action to prevent harm from occurring, and raise concerns if they suspect
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
misconduct. Furthermore, internal audits and assessments conducted by external,
independent parties aim and help to identify possible inappropriate conduct.
All available reporting channels are detailed in the Outokumpu Code of Conduct. Employees
shall report suspected misconduct to their immediate manager, manager’s manager or
other members of the company management. If this is not possible due to the
confidentiality or the nature of the matter, suspected misconduct shall be reported to
Outokumpu Internal Audit, Compliance or Human Resources. When other channels do not
feel comfortable, concerns shall be reported via the Outokumpu SpeakUp channel.
SpeakUp is a confidential communication channel hosted by a third-party service provider,
which enables employees and also external stakeholders to report alleged misconduct
confidentially and anonymously, if allowed by the local laws and regulations. The SpeakUp
channel is available in different languages.
When concerns are reported, they will be treated with strict confidence and assessed and
reviewed in accordance with the internal investigations procedure typically led by Group
Internal Audit. (G1-1-10-(a))
Protecting whistleblowers
Outokumpu aims to foster a corporate culture that upholds the highest standards of ethics,
encourages the culture of speaking up and protects the whistleblowers.
Outokumpu has an internal Group-level reporting channel called SpeakUp in place, where
concerns can be raised confidentially and anonymously, if allowed by the local laws and
regulations. SpeakUp is hosted by a third-party service provider. The channel can be used
internally, and it is also available for external parties. In certain countries within the
European Union (EU), Outokumpu has established a possibility to use a local SpeakUp
channel as required by the EU Whistleblower Protection Directive (EU) 2019/1937 and the
consequent local laws and regulations.
Outokumpu has a strict non-retaliation policy for reports made in good faith. This means
that the reporter shall not face negative consequences if they have reported the suspected
misconduct in good faith. Furthermore, if the misconduct report is within the scope of the
EU Whistleblower Protection Directive (EU) 2019/1937 and the consequent local laws and
regulations, the reporter receives protection based on these laws and regulations.
The Outokumpu Code of Conduct contains information about how to raise concerns at
Outokumpu. In addition, the internal Misconduct Reporting Instruction contains more
information about misconduct reporting and Outokumpu’s internal investigations procedure,
including information about the designated functions who receive the reports and
investigate the alleged misconduct, as needed. Furthermore, due to the EU Whistleblower
Protection Directive (EU) 2019/1937 and the consequent local laws and regulations, the
Misconduct Reporting Instruction can be supplemented with country-specific guidelines for
Outokumpu entities operating in certain EU countries.
Employees are informed and trained on the topic of misconduct reporting through e-
learning modules, such as through the Code of Conduct e-learning applicable for all
employees, as well as through other trainings. There is also specific training organized to
the persons who receive and handle misconduct reports, to ensure professional handling of
the reported concerns.
In addition to the trainings, employees are informed about misconduct reporting through
communications, such as through SpeakUp posters. There is also a separate misconduct
reporting page available on Outokumpu’s intranet. A link to the SpeakUp channel can be
found on the intranet as well as on Outokumpu’s external website. A link to the SpeakUp
channel is also included in the Outokumpu Supplier Code of Conduct, encouraging suppliers
to report suspected misconduct or unethical behavior related to their business relationship
with Outokumpu. (G1-1-10-(c))
Investigating incidents
Outokumpu has an internal investigations procedure in place to investigate business
conduct incidents, including incidents of corruption and bribery. The company is committed
to handling misconduct reports independently, objectively and as promptly as reasonably
possible.
Reports are assessed and reviewed in accordance with Outokumpu’s internal investigations
procedure typically led by Group Internal Audit. In those countries where locally managed
misconduct reporting procedures have been implemented due to the EU Whistleblower
Protection Directive (EU) 2019/1937 and the consequent local laws and regulations, there
are local employees appointed to manage the assessment and review of the reported
concerns locally in co-operation with Group Internal Audit, if permitted by the local laws and
regulations. As a consequence of internal investigations, the management can be given
recommendations on remedial actions, including corrective, preventative and disciplinary
actions. The Outokumpu Ethics and Compliance Steering Group and Board Audit Committee
regularly receive updates on the reported concerns. (G1-1-10-(e))
Training on business conduct
The Group Ethics and Compliance team at Outokumpu conducts trainings and shares
information on a regular basis on various ethics and compliance topics, including the Code
of Conduct, to help ensure that Outokumpu’s employees globally know how to apply the
policies and principles on business conduct in their daily decision-making. At Outokumpu,
training is given both through mandatory e-learning modules as well as through face-to-face
training, webinars and discussions. A reminder and consequence management process are
applied for the mandatory ethics and compliance e-learnings, as applicable, making sure
that employees complete the trainings on time.
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
In addition to the ethics and compliance training, there are other e-learning modules and
training courses available for employees such as in the areas of health and safety as well
as safe and welcoming culture. (G1-1-10-(g))
Functions most at risk of corruption and bribery
Outokumpu has a strict zero tolerance policy for any form of corruption or bribery as stated
in the Outokumpu Code of Conduct. For this purpose, Outokumpu has a global anti-
corruption compliance program in place as part of the group-wide Ethics and Compliance
program. The purpose of the anti-corruption compliance program is to help to identify,
assess and mitigate risks related to corruption and bribery in the global environment where
Outokumpu operates. The program contains various elements to mitigate corruption and
bribery risks, such as a detailed internal guidance document, the Anti-Corruption
Instruction, which supplements the anti-corruption requirements as stated in Outokumpu’s
Code of Conduct. There are also other internal policies in place to mitigate corruption and
bribery risks. Furthermore, the Outokumpu Supplier Code of Conduct contains requirements
for suppliers to comply with applicable anti-corruption rules.
Outokumpu employees are being trained on the anti-corruption topic through various
training courses, such as through Outokumpu Code of Conduct e-learning, which is
applicable to all Outokumpu employees. In addition, there is an anti-corruption e-learning in
place for administrative employees. In addition, there are other forms of anti-corruption-
related trainings and communications to the employees.
At Outokumpu, certain functions are subject to elevated corruption and bribery risks as a
result of their tasks and responsibilities. Due to their role in financial transactions and
interactions with external stakeholders the company has identified the sales and
procurement functions to be most at risk in respect of corruption and bribery. Outokumpu
will continue to implement and improve, where necessary, applicable anti-corruption
measures to mitigate any possible risks related to corruption and bribery. (G1-1-10-(h))
Actions and resources
Actions and resources related to
business conduct and corporate culture
Key actions
The effective implementation and further development of Outokumpu’s group-wide E&C
program continued in 2024.
The Outokumpu Code of Conduct is applicable for all Outokumpu employees globally. For
these purposes there is a Code of Conduct e-learning available for all Outokumpu
employees in order to educate them about the key contents of the Code of Conduct and
help them to make ethical and responsible decisions as part of their responsibilities at
work. As a key action in 2024, the Code of Conduct e-learning was fully renewed and
launched, making it engaging and topical for all Outokumpu employees, for both the
administrative employees and operators.
In addition to the renewal and launch of the new Code of Conduct e-learning, other ethics
and compliance e-learning modules in the areas of anti-corruption, competition law
compliance, data protection and know your business partner were renewed and launched in
2024. The Group Ethics and Compliance team also actively conducted face-to-face and
webinar training sessions on these topics and on the importance of reporting concerns so
that employees at Outokumpu would know how to do the right thing. Risk mitigation
measures also continued in these areas, such as through the improvement of processes
and documentation. (G1-MDR-A-68-(a))
Scope and time horizon
New Code of Conduct e-learning
The Code of Conduct e-learning is an annual mandatory training for all administrative
employees and managers of operators. Based on the decision made in 2024, the objective
is that the operators take the training every other year or more often if there are material
changes to the Code of Conduct or the e-learning. The training is available in several
languages so that everyone can complete the training in their own language.
The new Code of Conduct e-learning, launched in May 2024, is a mandatory training for all
Outokumpu employees globally as per the set training schedule. The Outokumpu Board of
Directors also completes the training. The goal was 100% completion by all employees in
2024.
Other E&C training
In addition to the Code of Conduct e-learning, there are other mandatory ethics and
compliance e-learning modules in place in the areas of anti-corruption, competition law
compliance, data protection and know your business partner. These training modules are
targeted at the administrative employees globally. Managers of operators globally also
complete the data protection training. The training modules are available in several
languages. All of these modules were renewed and launched in 2024 with the purpose that
they will be completed by the said employees during 2025.
In addition to e-learning, the Group Ethics and Compliance team actively conducted face-to-
face and webinar training sessions on ethics and compliance topics during 2024. These
training sessions were mainly targeted at the administrative employees and, on some
occasions, also at external parties, such as sales agents.
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Other measures
The Group Ethics and Compliance team continued to implement various measures in the
areas of anti-corruption, competition law compliance, data protection, know your business
partner and misconduct reporting, for example through improved internal processes and
documentation. The purpose of these measures was to further mitigate risks and improve
the various elements of Outokumpu’s group-wide E&C program. (G1-MDR-A-68-(b-c))
Prior progress
The Code of Conduct e-learning has been a mandatory training for Outokumpu employees
also earlier. In 2023, 98% of administrative employees and managers of operators
completed the training.
Other ethics and compliance e-learning modules in the areas of anti-corruption, competition
law compliance, data protection and know your business partner have been mandatory for
administrative employees and managers of operators also in the previous years as per the
determined training schedule. The Group Ethics and Compliance team has also consistently
conducted other ethics and compliance training as well as gradually implemented various
risk mitigation measures and developed Outokumpu’s group-wide E&C program (G1-MDR-
A-68-(e))
Metrics and targets
Metrics and targets related to
business conduct and corporate culture
Tracking performance and effectiveness
Outokumpu uses the training completion status of the Code of Conduct e-learning as a
metric to evaluate the effectiveness of the implementation of the training. (G1-MDR-M-75)
Methodologies and assumptions
It is the assumption that all Outokumpu employees complete the Code of Conduct
e-learning as per the determined training schedule.
The training is available for employees through the central HR system and each employee
must log in to complete it. HR Learning Services supports with the technical
implementation of the training and regularly monitors the training statistics together with
other internal stakeholders. (G1-MDR-M-77-(a))
External validation
The measurement of the metrics (i.e. the training completion % of the Code of Conduct e-
learning) is validated by the assurance provider, and no other external body.
(G1-MDR-M-77-(b))
Relationship with policy objectives
The Outokumpu Code of Conduct is the core element of Outokumpu’s group-wide E&C
program, setting the ethical standards for Outokumpu’s operations globally. The Code of
Conduct e-learning supports the target that all employees would know and understand the
key content of the Code of Conduct and would be able to conduct business in an ethical
and responsible manner. At Outokumpu, every employee has a role in making ethical
decisions that help to build a world that lasts forever. (G1-MDR-T-80-(a))
Measurable target
The target was that all Outokumpu employees globally complete the new Code of Conduct
e-learning in 2024. The target was measured through the training statistics (training
completion %) of the Code of Conduct e-learning. (G1-MDR-T-80-(b))
Scope
Since the actions were aimed at Outokumpu's internal stakeholders, the target was aligned
with this scope. (G1-MDR-T-80-(c))
Milestones
The renewed Code of Conduct training was launched in May 2024. There was a separate
deadline for administrative employees and managers of operators to complete the training
in June 2024. The operators were expected to complete the training as per the planned
training schedule for each Outokumpu site. (G1-MDR-T-80-(e))
Methodologies and assumptions
Outokumpu is committed to conducting business with high integrity and wants to make
sure that all employees globally know the company’s key rules on how to do the right thing.
In addition to the company’s own expectations, there are expectations set by external
parties to conduct training for the employees on the ethical and compliant behavior.
The completion of the new Code of Conduct e-learning by all employees was a key target in
2024 in respect of the implementation of the key content of the group-wide Code of
Conduct in all Outokumpu sites. (G1-MDR-T-80-(f))
Target setting
Outokumpu’s Group Ethics and Compliance team facilitates the implementation of the
Outokumpu Code of Conduct and related e-learning. The content of the new Code of
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Conduct e-learning was renewed in co-operation with other functions, including
Sustainability, Human Resources, Health and Safety, Cyber Security and business areas
and business lines. The target that all employees should complete the training in 2024 was
supported by the E&C Steering Group. (G1-MDR-T-80-(h))
Performance against disclosed target
97% of Outokumpu employees completed the new Code of Conduct e-learning in 2024. The
completion of the Code of Conduct e-learning took efforts and discipline from the whole
organization, especially from the operator side. Since the completion of the training by all
employees was recognized as important for the company, necessary efforts were made to
achieve the target.
The training completion rates were monitored by the HR Learning Services and the Group
Ethics and Compliance team following the launch of the renewed training. The training
statistics were also regularly shared with the HR colleagues who helped to organize the
trainings for operators based on the planned site training schedules.
Outokumpu has a reminder and consequence management process in place for the
mandatory ethics and compliance e-learning modules, including the Code of Conduct e-
learning. This process applies to the administrative employees globally. As per the process,
the administrative employees are expected to complete the training within the set timeline.
In case of non-completions there is a reminder and escalation process, and as a final stage
of the process, the Outokumpu user account of the administrative employee who has not
taken the training on time, will be temporarily disabled (this process step applies to the
administrative employees globally, except in Germany). The completion of the new Code of
Conduct e-learning was monitored as per this process in 2024. (G1-MDR-T-80-(j))
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
General disclosures
Environmental information
Social information
Governance information
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Group key figures
Key figures
€ million, or as indicated
2024
2023
2022
2021
20201)
Scope of activity
Sales
5,942
6,961
9,494
7,243
5,639
change in sales, %
-14.6
-26.7
31.1
28.4
-11.9
exports from and sales outside Finland, of
total sales, %*
96.3
96.5
95.9
96.4
96.3
Capital employed on Dec 31 2) 3) *
4,250
4,204
4,751
3,828
3,543
Capital expenditure *
216
170
158
171
180
in relation to sales, %
3.6
2.4
1.7
2.4
3.2
Depreciation and amortization
220
242
245
249
243
Impairments
-7
274
11
45
3
Research and development costs
15
14
15
14
21
in relation to sales, %
0.2
0.2
0.2
0.2
0.4
Personnel on Dec 31, FTE 4)
8,424
8,453
8,357
8,439
9,602
average for the year, FTE 4)
8,443
8,412
8,683
8,714
10,000
Personnel on Dec 31, headcount
8,736
8,750
8,591
8,727
9,915
Alternative performance measures are marked with *. For more information, please see Reconciliation of
alternative performance measures section.
In year 2022, Outokumpu announced to divest majority of the Long Products business operations and
classified these businesses as assets held for sale and reported as discontinued operations. The
divestment was completed on January 3, 2023.
1) Including discontinued operations.
2) In 2022, including discontinued operations’ equity. In 2021, including discontinued operations.
3) Outokumpu has redefined its capital employed and ROCE definitions in 2022. Information for year 2020
has not been restated.
4) In 2024, Outokumpu has redefined personnel, full time equivalent (FTE) measure, FTE is excluding interim
workforce. Comparison year 2023 has been revised accordingly.
5) Until the year-end 2022, the balance sheet component is including discontinued operations except for
Sept 30 and Dec 31, 2022, where only the equity component of discontinued operations is included.
6) Discontinued operations are impacting the comparative years’ numbers 2020–2022.
€ million, or as indicated
2024
2023
2022
2021
20201)
Profitability
EBITDA*
162
416
1,248
968
191
Adjusted EBITDA*
177
517
1,256
980
250
in relation to sales, %
3.0
7.4
13.2
13.5
4.4
Adjusted EBITDA, including discontinued
operations*
177
517
1,387
1,021
250
Operating profit (EBIT)*
-51
-100
992
674
-55
in relation to sales, %
-0.9
-1.4
10.5
9.3
-1.0
Adjusted EBIT*
-43
274
1,010
728
4
Result before taxes
-89
-133
933
610
-151
in relation to sales, %
-1.5
-1.9
9.8
8.4
-2.7
Net result for the financial year
-40
-111
1,086
526
-116
in relation to sales, %
-0.7
-1.6
11.4
7.3
-2.1
Net result for the financial year, including
discontinued operations
-40
-106
1,140
553
-116
Return on equity (ROE), % * 6)
-1.1
-2.6
30.6
20.1
-4.7
Return on capital employed (ROCE), % 3) 5) *
-1.2
-2.1
22.6
17.6
-1.4
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
€ million, or as indicated
2024
2023
2022
2021
20201)
Financing and financial position
Net financial expenses*
41
37
71
79
98
in relation to sales, %
0.7
0.5
0.7
1.1
1.7
Interest expenses*
64
60
44
64
78
in relation to sales, %
1.1
0.9
0.5
0.9
1.4
Gross debt* 2)
502
441
633
709
1,404
Net debt* 2)
189
-60
-10
408
1,028
Net debt adjusted EBITDA* 2)
1.1
-0.1
0.0
0.4
4.1
Share capital
311
311
311
311
311
Total equity
3,748
3,762
4,119
3,120
2,360
Equity-to-assets ratio, % * 2)
63.2
63.8
59.2
48.3
40.8
Debt-to-equity ratio (gearing), % * 2)
5.0
-1.6
-0.3
13.1
43.6
Net cash generated from operating activities 2)
147
325
778
597
322
Free cash flow * 2)
-71
290
619
448
147
Alternative performance measures are marked with *. For more information, please see Reconciliation of
alternative performance measures section.
In year 2022, Outokumpu announced to divest majority of the Long Products business operations and
classified these businesses as assets held for sale and reported as discontinued operations.
The divestment was completed on January 3, 2023.
1) Including discontinued operations.
2) Discontinued operations are impacting the comparative years’ numbers 2020–2022. Free cash flow
for year 2023 include discontinued operations i.e. proceeds from the sale of Long product business.
Outokumpu Annual Report 2024
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Reconciliation of alternative performance measures
Certain financial key figures and ratios presented in Outokumpu’s Annual Report are not measures of financial performance, financial position or cash flows under IFRS and are therefore considered
as alternative performance measures. These measures are not defined by IFRS and therefore may not be directly comparable with financial measures and ratios used by other companies, including
those in the same industry. The reason for presenting these measures is that either they are statutory requirements applicable to the financial statements of the Group or the management believes
that these measures provide meaningful supplemental information on the underlying business performance or financial position of the Group. These financial measures should not be considered in
isolation from, or as a substitute for, financial information presented in compliance with IFRS. Alternative performance measures are marked with * in the Key figures table.
Key figure
EUR million, or as indicated
Definition of the key figure or source in the
consolidated Financial Statements
2024
2023
Exports from and sales outside Finland
Exports from and sales outside Finland is an indicator of the international nature of the Group’s
business.
Sales
Consolidated statement of income
5,942
6,961
Sales by destination to Finland
Note 2.2
222
243
Exports from and sales outside
Finland
Sales - Sales by destination to Finland
5,719
6,717
in relation to total sales, %
Comparison to sales
96.3
96.5
Capital expenditure
Capital expenditure indicates the investment in assets to generate future cash flows for the Group.
Capital expenditure
Purchases of property, plant and equipment
and intangible assets, other than emission
allowances; and investments in equity at fair
value through other comprehensive income
and associated companies, and acquisitions
of businesses.
216
170
in relation to sales, %
Comparison to sales
3.6
2.4
Key figure
EUR million, or as indicated
Definition of the key figure or source in the
consolidated Financial Statements
2024
2023
Operating capital (segment reporting)
Operating capital is a measure for the amount of capital invested in Group’s operations. It is used as a
measure for the business areas’ net assets.
Capital employed on Dec 31
Defined later in this section
4,250
4,204
Cash and cash equivalents
Consolidated statement of financial position
313
502
Lease receivables
Note 4.2
7
—
Investments in associated
companies
Consolidated statement of financial position
77
62
Investments in equity at fair
value through other
comprehensive income
Consolidated statement of financial position
28
12
Investments at fair value
through profit or loss
Note 5.5
28
27
Net deferred tax assets
Note 2.6
498
423
Net employee benefit
obligations
Note 3.3
196
212
Operating capital on Dec 31
Capital employed – cash and cash
equivalents – lease receivables–
investments in associated companies –
investments in equity at fair value through
other comprehensive income – investments
at fair value through profit or loss – net
deferred tax asset – net asset held for sale
+ net employee benefit obligations
3,495
3,390
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Operating profit (EBIT) and adjusted EBIT
Operating profit (EBIT) and adjusted EBIT are measures of financial performance of the Group. The
items affecting comparability in EBIT relate to material income and expense items of unusual nature,
and their purpose is to improve comparability of financial performance between reporting periods.
Net result for the financial year Consolidated statement of income
-40
-111
Income taxes
Consolidated statement of income
49
22
Total financial income and
expenses
Consolidated statement of income
-41
-37
Share of results in associated
companies
Consolidated statement of income
3
4
Operating profit (EBIT)
Consolidated statement of income
-51
-100
in relation to sales, %
Comparison to sales
-0.9
-1.4
Items affecting comparability
in EBIT
Note 2.1
-8
-374
Adjusted EBIT
Operating profit (EBIT) - Items affecting
comparability in EBIT
-43
274
EBITDA and adjusted EBITDA
EBITDA and adjusted EBITDA are measures of the financial performance of the Group. Adjusted
EBITDA is Outokumpu’s main performance indicator in financial reporting. The items affecting
comparability in EBITDA relate to material income and expense items of unusual nature, and their
purpose is to improve comparability of financial performance between reporting periods.
Operating profit (EBIT)
Consolidated statement of income
-51
-100
Depreciation and amortization
Note 2.3
220
242
Impairments
Note 2.4
-7
274
EBITDA
EBIT before depreciation, amortization and
impairments
162
416
Items affecting comparability
in EBITDA
Note 2.1
-15
-102
Adjusted EBITDA
EBITDA - Items affecting comparability in
EBITDA
177
517
in relation to sales, %
Comparison to sales
3.0
7.4
Key figure
EUR million, or as indicated
Definition of the key figure or source in the
consolidated Financial Statements
2024
2023
Net financial expenses and interest expenses
Net financial expenses and interest expenses are measures for the cost of Group’s financing.
Net financial expenses
Total financial income and expenses in the
Consolidated statement of income
41
37
in relation to sales, %
Comparison to sales
0.7
0.5
Interest expenses
Consolidated statement of income
64
60
in relation to sales, %
Comparison to sales
1.1
0.9
Key figure
EUR million, or as indicated
Definition of the key figure or source in the
consolidated Financial Statements
2024
2023
Capital employed
Capital employed is a measure for the amount of capital invested in Group’s operations.
Capital employed is the sum of:
Total equity:
Consolidated statement of financial position
3,748
3,762
Gross debt
Defined later in this section
502
441
Capital employed on Dec 31
Total equity + gross debt
4,250
4,204
Operating profit (EBIT), EBITDA and adjusted EBITDA, including
discontinued operations
Net result for the financial
year, including discontinued
operations
Consolidated statement of income
-40
-106
Income taxes
Consolidated statement of income
49
22
Total financial income and
expenses
Consolidated statement of income
-41
-37
Share of results in associated
companies
Consolidated statement of income
3
4
Operating profit (EBIT)
Consolidated statement of income + Note
6.1
-51
-95
Depreciation and amortization
Note 2.3
220
242
Impairments
Note 2.4
-7
274
EBITDA
EBIT before depreciation, amortization and
impairments
162
421
Items affecting comparability
in EBITDA
Note 2.1 + discontinued operations
-15
-97
Adjusted EBITDA
EBITDA - Items affecting comparability in
EBITDA
177
517
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Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Key figure
EUR million, or as indicated
Definition of the key figure or source in the
consolidated Financial Statements
2024
2023
Return on equity (ROE)
Return on equity is an indicator of the value the Group generates to the capital the shareholders have
invested in the Group.
Total equity on Dec 31 of
previous year
Consolidated statement of financial position
3,762
4,119
Total equity on March 31
3,761
4,064
Total equity on June 30
3,697
4,141
Total equity on Sept 30
3,626
4,135
Total equity on Dec 31
Consolidated statement of financial position
3,748
3,762
Total equity (4-quarter average) Average of the opening and 4 quarter-end
values
3,719
4,044
Net result for the financial
year, incl. discontinued
operations
Consolidated statement of income
-40
-106
Return on equity (ROE), %
Net result for the financial year / Total
equity (4-quarter average)
-1.1
-2.6
Return on capital employed (ROCE)
Return on capital employed is a measure for the value the Group generates to the capital invested in
its operations.
Capital employed on Dec 31 of
previous year 1)
Defined earlier in this section
4,204
4,751
Capital employed on March 31
4,175
4,612
Capital employed on June 30
4,134
4,541
Capital employed on Sept 30
4,079
4,531
Capital employed on Dec 31
Defined earlier in this section
4,250
4,204
Capital employed (4-quarter
average)
Average of the opening and 4-quarter-end
values
4,168
4,528
Operating profit (EBIT)
Consolidated statement of income
-51
-100
Share of results in associated
companies
Consolidated statement of income
3
4
Return on capital employed
(ROCE), %
(Operating profit (EBIT) + Share of results in
associated companies) / Capital employed
(4-quarter average)
-1.2
-2.1
1) Dec 31 2022, the equity component of discontinued operations is included.
Key figure
EUR million, or as indicated
Definition of the key figure or source in the
consolidated Financial Statements
2024
2023
Gross debt
Gross debt is a measure for the level of debt financing in the Group.
Non-current debt
Consolidated statement of financial position
246
359
Current debt
Consolidated statement of financial position
256
82
Gross debt
Non-current + current debt
502
441
Net debt
Net debt is a measure for the level of debt financing in the Group.
Gross debt
Defined earlier in this section
502
441
Cash and cash equivalents
Consolidated statement of financial position
313
502
Net debt
Gross debt – cash and cash equivalents
189
-60
in relation to sales, %
Comparison to sales
3.2
-0.9
Net debt to adjusted EBITDA
Net debt to Adjusted EBITDA is an indicator of the Group’s indebtedness.
Net debt
Defined earlier in this section
189
-60
Adjusted EBITDA
Defined earlier in this section
177
517
Net debt to Adjusted EBITDA
Net debt / Adjusted EBITDA
1.1
-0.1
Equity-to-assets ratio
Equity-to-assets ratio shows the proportion the Group’s assets financed with equity. The equity-to-
assets ratio indicates the financial risk level of the Group.
Total equity
Consolidated statement of financial position
3,748
3,762
Total assets
Consolidated statement of financial position
5,965
5,927
Advances received
Note 4.5
32
31
Equity-to-assets ratio, %
Total equity/(Total assets - advances received)
63.2
63.8
Debt-to-equity ratio (gearing)
Debt-to-equity ratio or gearing is an indicator of the financial risk level and the indebtedness of the Group.
Net debt
Defined earlier in this section
189
-60
Total equity
Consolidated statement of financial position
3,748
3,762
Debt-to-equity ratio (gearing), %
Net debt / Total equity
5.0
-1.6
Free cash flow
Free cash flow is an indicator of the cash flow that remains for e.g. payment of dividends and
liabilities.
Free cash flow
Consolidated statement of cash flows, cash
flow before financing activities
-71
290
Outokumpu Annual Report 2024
156
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Definitions of financial key figures
Operating profit (EBIT)
Operating profit (EBIT) is a measure of financial performance of the Group.
Net result for the period excluding income taxes, financial income and
expenses and share of results in associated companies
EBITDA
EBITDA is a measure of financial performance of the Group.
EBIT before depreciation, amortization and impairments
Items affecting comparability (IAC)
in EBITDA or in EBIT
Items affecting comparability in EBITDA or EBIT improves comparability of
financial performance between reporting periods.
Material income and expense items which affect the comparability
between periods because of their unusual nature, size or incidence
resulting for example from group-wide restructuring programs or disposals
of assets or businesses.
Adjusted EBITDA or EBIT
Adjusted EBITDA is Outokumpu’s main performance indicator in financial
reporting.
EBITDA or EBIT +/- items affecting comparability
Capital employed
Capital employed is a measure for the amount of capital invested in the Group’s
operations.
Total equity + gross debt
Operating capital (segment reporting)
Operating capital is a measure for the amount of capital invested in the Group’s
operations. It is used as a measure for the business areas’ net assets.
Capital employed – cash and cash equivalents - lease receivables–
investments in associated companies – investments in equity at fair value
through other comprehensive income – investments at fair value through
profit or loss – net deferred tax asset – net asset held for sale + net
employee benefit obligations
Capital expenditure
Capital expenditure indicates the investment in assets to generate future cash
flows for the Group.
Purchases of property, plant and equipment and intangible assets, other
than emission allowances; and investments in equity at fair value through
other comprehensive income and in associated companies and
acquisitions of businesses
Free cash flow
Free cash flow is an indicator of the cash flow that remains for e.g. payment of
dividends and liabilities.
Cash flow before financing activities
Return on capital employed (ROCE)
Return on capital employed is a measure for the value the Group generates to
the capital invested in its operations.
Operating profit (EBIT) + Share of results in associated companies
× 100
Capital employed (4-quarter rolling average)
Return on operating capital (ROOC)
(segment reporting)
Return on operating capital is an internal measure for the value the business
areas generate to the capital invested in their operations.
Adjusted EBIT
× 100
Operating capital (4-quarter rolling average)
Key figure
Purpose
Definition
Outokumpu Annual Report 2024
157
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Return on equity (ROE)
Return on equity is an indicator of the value the Group generates to the capital
the shareholders have invested in the Group.
Net result for the financial period
× 100
Total equity (4-quarter rolling average)
Gross debt
Gross debt is a measure for the level of debt financing in the Group.
Non-current debt + current debt
Net debt
Net debt is a measure for the level of debt financing in the Group.
Gross debt – cash and cash equivalents
Equity-to-assets ratio
Equity-to-assets ratio shows the proportion of the Group’s assets financed with
equity. It indicates the financial risk level of the Group.
Total equity
× 100
Total assets – advances received
Debt-to-equity ratio (gearing)
Debt-to-equity ratio or gearing is an indicator of the financial risk level and the
indebtedness of the Group.
Net debt
× 100
Total equity
Net debt to adjusted EBITDA
Net debt to adjusted EBITDA is an indicator of the Group’s indebtedness.
Net debt
Adjusted EBITDA
Personnel, full-time equivalent
Headcount adjusted to full-time equivalent number of personnel, excluding
personnel on sick leave or parental leave of more than 6 months and
excluding personnel whose employment has been terminated and who are
on notice period without requirement to work and excluding interim
workforce.
Key figure
Purpose
Definition
Outokumpu Annual Report 2024
158
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Share-related key figures1)
2024
2023
2022
2021
2020
Earnings per share
€
-0.09
-0.24
2.52
1.26
-0.28
Earnings per share continuing operations
€
-0.09
-0.26
2.40
1.21
—
Diluted earnings per share 2)
€
-0.09
-0.24
2.33
1.17
-0.28
Diluted earnings per share continuing operations 2)
€
-0.09
-0.26
2.22
1.13
—
Cash flow per share
€
0.35
0.75
1.72
1.36
0.78
Equity per share
€
8.85
8.73
9.27
6.89
5.70
Dividend per share
€
0.26
3)
0.26
0.35
0.15
—
Dividend payout ratio
%
-278.43
-105.97
13.64
12.30
—
Dividend yield
%
8.95
5.80
7.40
2.70
—
Price / earnings ratio
neg.
neg.
1.88
4.37
neg.
Development of share price
Average trading price
€
3.59
4.77
4.69
4.96
2.66
Lowest trading price
€
2.77
3.60
3.51
3.36
2.08
Highest trading price
€
4.48
5.90
6.48
6.01
4.44
Trading price at the end of the period
€
2.91
4.48
4.73
5.50
3.22
Change during the period
%
-35.2
-5.2
-14.0
70.8
14.8
Change in the OMX Helsinki index during the period
%
-6.2
-6.6
-13.4
18.3
10.1
Market capitalization at the end of the period 4)
€ million
1,231
1,933
2,101
2,489
1,327
Development in trading volume
Trading volume 5)
1,000 shares
385,456
386,008
720,801
880,092
1,100,628
In relation to adjusted weighted average number of shares
%
90.9
88.7
159.5
200.5
265.9
Adjusted weighted average number of shares 4)
424,237,776
435,090,240
451,932,876
438,871,175
413,907,618
Adjusted diluted weighted average number of shares 4) 6)
470,977,109
475,843,726
493,535,712
479,163,509
437,336,296
Number of shares at the end of the period 4)
423,685,628
431,190,703
444,134,611
452,571,977
412,002,212
1) Including discontinued operations if not otherwise stated. In 2023 only impact of discontinued operations is the transactions related to the sale of Long Products business operations.
2) The comparative information has been revised.
3) The Board of Directors’ proposal to the Annual General Meeting.
4) Excluding treasury shares.
5) Includes only Nasdaq Helsinki trading.
6) The convertible bonds maturing in July 2025 can be converted into maximum of 45,261,669 ordinary shares.
Outokumpu Annual Report 2024
159
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Definitions of share-related key figures
Key figure
Definition
Earnings per share
Net result for the financial year attributable to the equity holders
Adjusted weighted average number of shares during the period
Diluted earnings per share
Net result for the financial year attributable to the equity holders + interest expenses on convertible bonds, net of tax
Adjusted diluted weighted average number of shares during the period
Cash flow per share
Net cash generated from operating activities
Adjusted weighted average number of shares during the period
Equity per share
Equity attributable to the equity holders
Adjusted number of shares at the end of the period
Dividend per share
Dividend for the financial year
Adjusted number of shares at the end of the period
Dividend payout ratio
Dividend for the financial year
× 100
Net result for the financial year attributable to the equity holders
Dividend yield
Dividend per share
× 100
Adjusted trading price at the end of the period
Price/ earnings ratio (P/E)
Adjusted trading price at the end of the period
Earnings per share
Average trading price
EUR amount traded during the period
Adjusted number of shares traded during the period
Market capitalization at end of the period
Number of shares outstanding at the end of the period x Trading price at the end of the period
Trading volume
Number of shares traded during the period, and in relation to the adjusted weighted average number of shares during the period
Outokumpu Annual Report 2024
160
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Financial Statements
The year 2024 was challenging for Outokumpu in the weak economic environment and
uncertain geopolitical situation. However, Outokumpu’s financial position remained strong.
Outokumpu Annual Report 2024
161
“Throughout the year we successfully
continued our profit improvement actions,
and despite the challenges, we kept our
net debt at a low level.”
– Marc-Simon Schaar, CFOCFO
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Financial statements content
Consolidated financial statements, IFRS
Consolidated statement of income
163
Consolidated statement of comprehensive income
164
Consolidated statement of financial position
165
Consolidated statement of cash flows
166
Consolidated statement of changes in equity
167
Notes to the consolidated financial statements
1
Basis of reporting
169
1.1
Corporate information
169
1.2
Basis of preparation
169
2
Business result
172
2.1
Operating segments
172
2.2
Revenue
176
2.3
Cost of sales and selling, general and administrative expenses
177
2.4
Other operating income and expenses
178
2.5
Financial income and expenses
179
2.6
Income taxes
180
2.7
Earnings per share
183
3
Employee benefits
184
3.1
Employee benefit expenses
184
3.2
Employee benefits for key management
185
3.3
Employee benefit obligations
186
3.4
Share-based payments
190
4
Operating assets and liabilities
192
4.1
Intangible assets and property, plant and equipment
192
4.2
Leases
197
4.3
Goodwill impairment test
200
4.4
Inventories
201
4.5
Trade and other receivables and payables
202
4.6
Provisions
203
5
Capital structure and financial risk management
205
5.1
Net debt and capital management
206
5.2
Equity
210
5.3
Financial risk management and insurances
212
5.4
Derivative instruments
216
5.5
Financial assets and liabilities
218
5.6
Equity investments at fair value through other comprehensive income
221
5.7
Commitments and contingent liabilities
222
6
Group structure and other notes
223
6.1
Discontinued operations
223
6.2
Business acquisitions and disposals
224
6.3
Disputes and litigations
225
6.4
Related parties
225
6.5
Subsidiaries
226
6.6
Associated companies
227
6.7
New IFRS standards
228
6.8
Events after the balance sheet date
228
Parent company financial statements, FAS
Income statement of the parent company
229
Balance sheet of the parent company
230
Cash flow statement of the parent company
231
Notes to the parent company financial statements
232
Outokumpu Annual Report 2024
162
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Consolidated Financial Statements, IFRS
Consolidated statement of income
Continuing operations
Sales
2.2
5,942
6,961
Cost of sales
2.3
-5,710
-6,474
Gross margin
232
486
Other operating income
2.4
57
62
Selling and marketing expenses
2.3
-71
-73
Administrative expenses
2.3
-240
-260
Research and development expenses
2.3
-15
-14
Other operating expenses
2.4
-15
-302
Operating profit (EBIT)
-51
-100
Share of results in associated companies
6.6
3
4
Financial income and expenses
2.5
Interest income and other financial income
13
21
Interest expenses
-64
-60
Market price gains and losses
20
11
Other financial expenses
-10
-9
Total financial income and expenses
-41
-37
Result before taxes
-89
-133
Income taxes
2.6
49
22
Net result for the period from continuing operations
-40
-111
€ million
Note
2024
2023
Discontinued operations
Net result for the period from discontinued operations
6.1
—
5
Net result for the period
-40
-106
Earnings per share for result from continuing operations
attributable to the equity holders of the parent company
2.7
Earnings per share, EUR
-0.09
-0.26
Diluted earnings per share, EUR
-0.09
-0.26
Earnings per share for result attributable to the equity holders of
the parent company
2.7
Earnings per share, EUR
-0.09
-0.24
Diluted earnings per share, EUR
-0.09
-0.24
€ million
Note
2024
2023
Net result for the financial year is fully attributable to the equity holders of the parent company. The notes
are an integral part of the Financial Statements.
Diluted earnings per share has been revised for the comparative period, see more information in note 2.7.
Outokumpu Annual Report 2024
163
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Consolidated statement of comprehensive income
€ million
Note
2024
2023
Net result for the period
-40
-106
Other comprehensive income, continuing operations
Items that may be reclassified to profit or loss:
Exchange differences on translating foreign operations
Change in exchange differences
108
-58
Cash flow hedges
5.4
Fair value changes during the financial year
12
71
Reclassification to profit or loss
-13
-15
Income taxes
2.6
0
-6
Items that will not be reclassified to profit or loss:
Remeasurements on defined benefit plans
3.3
Changes during the financial year
12
-15
Income taxes
2.6
-4
5
Equity investments at fair value through other comprehensive income
5.6
Fair value changes during the financial year
13
-23
Share of other comprehensive income in associated companies
6.6
0
1
Other comprehensive income for the financial year, continuing
operations, net of tax
127
-41
Other comprehensive income for the financial year, discontinued
operations, net of tax
—
-12
Other comprehensive income for the financial year, net of tax
127
-53
Total comprehensive income for the financial year
88
-159
Total comprehensive income for the financial year is fully attributable to the equity holders of the parent
company. The notes are an integral part of the Financial Statements.
Outokumpu Annual Report 2024
164
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Consolidated statement of financial position
€ million
Note
2024
2023
ASSETS
Non-current assets
Intangible assets
4.1, 4.3
580
556
Property, plant and equipment
4.1
1,935
1,905
Right-of-use assets
4.2
179
147
Investments in associated companies
6.6
77
62
Equity investments at fair value through other comprehensive
income
5.6
28
12
Deferred tax assets
2.6
504
454
Trade and other receivables
4.5
10
12
3,313
3,148
Current assets
Inventories
4.4
1,764
1,581
Investments at fair value through profit or loss
5.5
28
27
Derivative financial instruments
5.4
39
34
Current tax receivables
2.6
16
27
Trade and other receivables
4.5
492
609
Cash and cash equivalents
5.1
313
502
2,652
2,779
TOTAL ASSETS
5,965
5,927
€ million
Note
2024
2023
EQUITY AND LIABILITIES
Equity attributable to the equity holders of the parent company
Share capital
311
311
Premium fund and other restricted reserves
714
714
Invested unrestricted equity reserve
2,307
2,307
Treasury share
-159
-169
Fair value reserves
21
6
Retained earnings
553
593
Total equity
5.2
3,748
3,762
Non-current liabilities
Non-current debt
5.1
246
359
Derivative financial instruments
5.4
0
8
Deferred tax liabilities
2.6
6
31
Employee benefit obligations
3.3
196
212
Provisions
4.6
52
73
Trade and other payables
4.5
13
16
513
700
Current liabilities
Current debt
5.1
256
82
Derivative financial instruments
5.4
17
40
Provisions
4.6
33
37
Current tax liabilities
2.6
8
8
Trade and other payables
4.5
1,390
1,299
1,704
1,465
TOTAL EQUITY AND LIABILITIES
5,965
5,927
The notes are an integral part of the Financial Statements.
Outokumpu Annual Report 2024
165
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Consolidated statement of cash flows
€ million
Note
2024
2023
Cash flow from operating activities
Net result for the financial year
-40
-106
Adjustments for
Depreciation, amortization and impairments
2.3, 2.4, 4.1,
4.2
213
516
Gains/ losses on sale of non-current assets, Group
companies and businesses
2.4
-1
-6
Financial income and expense
2.5
41
37
Income taxes
2.6
-49
-22
Other adjustments
2
-28
205
497
Change in net working capital
Change in trade and other receivables
139
101
Change in inventories
-165
165
Change in trade and other payables
53
-212
27
54
Interest and dividends received
13
19
Interest paid
-52
-47
Other financial items
-8
-9
Income taxes paid
2
-84
Net cash from operating activities
147
325
€ million
Note
2024
2023
Cash flow from investing activities
Equity investments at fair value through other comprehensive
income
5.6
-2
-14
Purchases of property, plant and equipment
4.1
-173
-129
Purchases of intangible assets
4.1
-38
-17
Investments in associated companies
6.6
-13
-10
Proceeds from sale of property, plant and equipment and
intangible assets
4.1
4
37
Proceeds from disposal of shares in Group companies and
businesses, net of cash
6.2
5
97
Other investing cash flow
-1
1
Net cash from investing activities
-218
-35
Cash flow before financing activities
-71
290
Cash flow from financing activities
Dividends paid
5.2
-110
-152
Repurchase of treasury shares
5.2
-34
-70
Repayments of non-current debt
5.1
-15
-169
Change in current debt
5.1
79
0
Repayments of lease liabilities
4.2
-38
-39
Net cash from financing activities
-118
-430
Net change in cash and cash equivalents
-189
-140
Cash and cash equivalents at the beginning of the financial
year 1)
502
644
Net change in cash and cash equivalents
-189
-140
Foreign exchange rate effect on cash and cash equivalents
1
-2
Cash and cash equivalents at the end of the financial year
5.1
313
502
The notes are an integral part of the Financial Statements.
1) Cash and cash equivalents at the beginning of the financial year 2023 includes cash and cash
equivalents of discontinued operations amounting to EUR 117 million.
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166
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Consolidated statement of changes in equity
€ million
Note
Share
capital
Premium
fund
Other
restricted
reserves
Invested
unrestricted
equity
reserve
Treasury
shares
Fair value
reserve from
equity
investments
Fair value
reserve from
derivatives
Cumulative
translation
differences
Remeasure-
ments of
defined
benefit
plans
Other
retained
earnings
Total equity
Equity on January 1, 2023
311
714
3
2,308
-129
-93
-48
3
-128
1,179
4,119
Net result for the period
—
—
—
—
—
—
—
—
—
-106
-106
Other comprehensive income
—
—
—
—
—
-23
49
-68
-11
1
-53
Total comprehensive income for the financial year
—
—
—
—
—
-23
49
-68
-11
-105
-159
Transactions with equity holders of the parent company
Contributions and distributions
Dividends
5.2
—
—
—
—
—
—
—
—
—
-152
-152
Convertible bonds
—
—
—
0
1
—
—
—
—
—
0
Share-based payments
3.4
—
—
—
—
9
—
—
—
—
-10
-2
Repurchase of treasury shares1)
5.2
—
—
—
—
-50
—
—
—
—
—
-50
Fair value transfer to inventory
5.4
—
—
—
—
—
—
5
—
—
—
5
Other 2)
—
—
-3
—
—
117
—
28
—
-142
—
Equity on December 31, 2023
311
714
0
2,307
-169
1
5
-38
-139
770
3,762
Net result for the period
—
—
—
—
—
—
—
—
—
-40
-40
Other comprehensive income
—
—
—
—
—
13
-1
108
8
0
127
Total comprehensive income for the financial year
—
—
—
—
—
13
-1
108
8
-40
88
Transactions with equity holders of the parent company
Contributions and distributions
Dividends
5.2
—
—
—
—
—
—
—
—
—
-110
-110
Share-based payments
3.4
—
—
—
—
6
—
—
—
—
-6
0
Repurchase of treasury shares 3)
5.2
—
—
—
—
4
—
—
—
—
—
4
Fair value transfer to inventory
5.4
—
—
—
—
—
—
4
—
—
—
4
Other
—
—
—
—
—
—
—
—
0
0
—
Equity on December 31, 2024
311
714
0
2,307
-159
14
8
70
-131
615
3,748
The notes are an integral part of the Financial Statements.
Equity is fully attributable to the equity holders of the parent company. See note 5.2 for more information on equity.
1) Treasury shares were acquired as part of the share buyback program announced on November 29, 2023. Because of the nature of the contract with the third party, Outokumpu has recognized EUR 38 million financial
liability related to the share buyback program and the maximum amount of EUR 50 million is impacting Group equity already in 2023.
2) Other is related to reclassification of cumulative translation differences amounting to EUR 28 million and reclassification of investment to Voimaosakeyhtiö SF from equity investments at fair value through other
comprehensive income to associated company amounting to EUR 117 million. These changes did not have an impact in total equity.
3) On February 29, 2024, Outokumpu completed its up to EUR 50 million share buyback program which was announced on November 29, 2023. Due to the nature of the contract with a third party, Outokumpu recognized a
EUR 38 million financial liability in December 2023 related to this share buyback program and the maximum amount of EUR 50 million impacted Group equity in 2023. During the program, Outokumpu repurchased a total
of 11,000,000 of its own shares and used a total of EUR 46 million for the repurchase of shares. As the original commitment was higher, a EUR 4 million impact was recognized in equity in relation to this program.
Outokumpu Annual Report 2024
167
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Notes to the consolidated Financial Statements
Outokumpu presents the notes to the consolidated Financial Statements as grouped in the
following six sections.
1. Basis of reporting
2. Business result
3. Employee benefits
4. Operating assets and liabilities
5. Capital structure and financial risk management
6. Group structure and other notes
Note
Accounting
principles
Management
judgements
Risk
information
1 Basis of reporting
1.1 Corporate information
1.2 Basis of preparation
2 Business result
2.1 Operating segments
2.2 Revenue
2.3 Cost of sales and selling, general and administrative
expenses
2.4 Other operating income and expenses
2.5 Financial income and expenses
2.6 Income taxes
2.7 Earnings per share
3 Employee benefits
3.1 Employee benefit expenses
3.2 Employee benefits for key management
3.3 Employee benefit obligations
3.4 Share-based payments
4 Operating assets and liabilities
4.1 Intangible assets and property, plant and equipment
4.2 Leases
4.3 Goodwill impairment test
4.4 Inventories
4.5 Trade and other receivables and payables
4.6 Provisions
The basis of preparation, accounting principles and management judgements applicable to the
entire consolidated Financial Statements are presented in the Basis of reporting section, but
the accounting principles, management judgements, and risks related to each disclosure item
are presented in the related note. The table outlines the notes structure and indicates which
notes include accounting principle, management judgement and risk information, and the
following icons are used to indicate these topics within the notes.
Note
Accounting
principles
Management
judgements
Risk
information
5 Capital structure and financial risk management
5.1 Net debt and capital management
5.2 Equity
5.3 Financial risk management and insurances
5.4 Derivative instruments
5.5 Financial assets and liabilities
5.6 Equity investments at fair value through other
comprehensive income
5.7 Commitments and contingent liabilities
6 Group structure and other notes
6.1 Discontinued operations
6.2 Business acquisitions and disposals
6.3 Disputes and litigations
6.4 Related parties
6.5 Subsidiaries
6.6 Associated companies
6.7 New IFRS standards
6.8 Events after the balance sheet date
Outokumpu Annual Report 2024
168
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
1. Basis of reporting
This notes section covers the company information, general basis of preparation as well as accounting
principles that are applicable to the entire consolidated Financial Statements.
1.1 Corporate information
Outokumpu Corporation is a Finnish public limited liability company organized under the laws of
Finland and domiciled in Helsinki, Finland. The company has been listed on the Nasdaq Helsinki
since 1988. Outokumpu Corporation is the parent company ("parent company", "Outokumpu
Corporation") of the Outokumpu Group (the "Group", "Outokumpu", the "company").
Outokumpu is the global leader in stainless steel. The foundation of Outokumpu’s business is
its ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is
sustainable, durable and designed to last forever. The Group’s customers use it to create
civilization’s basic structures and its most famous landmarks as well as products for
households and various industries. Outokumpu employs some 8,700 professionals in close to
30 countries.
Outokumpu’s consolidated Financial Statements according to ESEF regulations are published in
XHTML format at www.outokumpu.com/reports. Financial Statements presented in other
reports and formats, such as in the Annual report PDF or print, do not constitute as reports
according to the ESEF regulations.
On February 17, 2025, the Board of Directors of Outokumpu Corporation approved the
publishing of these consolidated Financial Statements. According to the Finnish Companies Act,
the General Meeting of Shareholders is entitled to decide on the adoption of the Financial
Statements.
1.2 Basis of preparation
These consolidated Financial Statements of Outokumpu have been prepared on a going concern
basis for the financial year 2024 covering the period from January 1 to December 31, 2024.
The consolidated Financial Statements have been prepared in accordance with IFRS Accounting
Standards as adopted by the European Union including SIC and IFRIC interpretations in force on
December 31, 2024. The consolidated Financial Statements also comply with the regulations of
Finnish accounting and company legislation complementing the IFRS.
The consolidated Financial Statements are presented in millions of euros and have been
prepared under the historical costs convention unless otherwise stated in the accounting
principles. All figures presented have been rounded, and consequently the sum of individual
figures may deviate from the presented aggregate figure. Key figures have been calculated
using exact figures.
Outokumpu completed the divestment of the Long Products business operations on January 3,
2023 and classified these businesses as assets held for sale and reported as discontinued
operations in 2022. See more information in note 6.1.
Corporate information
Company name
Outokumpu Corporation
Legal form
Public limited liability company
Country of incorporation
Finland
Domicile and principal place of business
Helsinki, Finland
Company address
P.O. Box 245, 00181 Helsinki, Finland
Ultimate parent company
Outokumpu Corporation
Outokumpu Annual Report 2024
169
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Risk information
Global economy and geopolitical conflicts
The development of the global economy, geopolitical tensions, trade policies and the continued
war in Ukraine all expose Outokumpu to risks and uncertainties within its operating
environment. The main uncertainties in the global economy relate to the development of the
trade defense measures, to slow global economic growth, inflation, high interest rates, and
continued uncertainties concerning China’s economy. Possible further escalation of geopolitical
tensions and conflicts, especially in the Middle East, could increase disruptions in the global
supply chains. The consequences of these disruptions could impact Outokumpu's operating
environment, business, and stainless steel demand.
However, the company has taken prompt measures to manage and control these risks.
These developments have not had material impact on the valuation of the consolidated
statement of financial position in 2024.
For more information on risks and uncertainties see Review of Board of Directors and notes
to Financial Statements.
Climate matters
Outokumpu aims to reduce its carbon emission intensity by 42% by the end of 2030 compared
to the 2016 level, in line with its Science-Based Target initiative (SBTi) 1.5 degree climate
target.
Outokumpu has assessed physical climate risks and mitigation measures for all sites and
included them in the general risk assessment system. The evaluation shows that the physical
risk does not materially impact the Group's capital expenditure or operative expenses. However,
the financial impact of the climate transition risk is significant and has been estimated for the
target period until 2030.
To be able to attain the 1.5 degree climate target, the company has created and committed
to a low carbon roadmap and many carbon emission reduction projects have been initiated
already. The avoided direct emissions from Outokumpu’s European sites in that period
correspond to European emission allowances of about EUR 591) million. See more information
about climate related risks and transition plan in the Sustainability Statement in the Review of
Board of Directors.
1) The financial impact is evaluated with Company's carbon price of 100 EUR per ton of CO2.
Management judgements
The preparation of the Financial Statements in accordance with IFRS requires management to
make judgments, estimates and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and contingent liabilities at the reporting
date, as well as the reported amounts of income and expenses during the reporting period.
The management estimates and judgments are continuously evaluated and they are based
on prior experience and other factors, such as future expectations assumed to be reasonable
considering the circumstances. Although these estimates are based on management’s best
knowledge of the circumstances at the end of the reporting period, actual results may differ
from the estimates and the assumptions.
The table in the beginning of the notes to the consolidated Financial Statements outlines
the notes that include material management judgments.
Outokumpu Annual Report 2024
170
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Accounting principles
Principles of consolidation
The consolidated Financial Statements include the parent company Outokumpu Corporation
and all subsidiaries controlled by Outokumpu Corporation either directly or indirectly. The Group
controls an entity when it is exposed to, or has rights to, variable returns from its involvement
with the entity and has the ability to affect those returns through its power over the entity.
The Financial Statements of subsidiaries are included in the consolidated Financial
Statements from the date on which control commences until the date on which control ceases.
Changes in the parent company’s ownership interest in a subsidiary are accounted for as equity
transactions if the parent company retains control of the subsidiary.
All intra-group transactions, receivables, liabilities and unrealized margins, as well as
distribution of profits within the Group, are eliminated in the preparation of consolidated
Financial Statements.
Foreign currency transactions
Transactions of each subsidiary included in the consolidated Financial Statements are
measured using the currency that best reflects the economic substance of the underlying
events and circumstances relevant to that subsidiary (“the functional currency”). The functional
currency is mainly the subsidiary’s local currency except for subsidiary in Mexico who uses the
US dollar as their functional currency.
The consolidated Financial Statements are presented in euros which is the functional and
presentation currency of the parent company. Group companies’ foreign currency transactions
are translated into local functional currencies using the exchange rates prevailing at the dates
of the transactions. Receivables and liabilities in foreign currencies are translated into
functional currencies at the exchange rates prevailing at the end of the reporting period.
Foreign exchange differences arising from interest-bearing assets and liabilities and related
derivatives are recognized in financial income and expenses in the consolidated statement of
income. Foreign exchange differences arising in respect of other financial instruments are
included in EBIT under sales, purchases or other operating income and expenses. The effective
portion of accumulated exchange differences arisen from hedges of net investments in foreign
operations are recognized in equity.
For those subsidiaries whose functional and presentation currency is not the euro, the items
in the statements of income and comprehensive income, and in the statement of cash flows
are translated into euro using monthly average exchange rates. The assets and liabilities in the
statement of financial position are translated using the exchange rates prevailing at the
reporting date. The translation differences arising from the use of different exchange rates
explained above are recognized in the Group’s equity through other comprehensive income.
Any goodwill arising on acquisitions of foreign operations and any fair value adjustments to
the carrying amounts of assets and liabilities arising on acquisitions of those foreign operations
are treated as assets and liabilities of those foreign operations. They are translated into euro
using the exchange rates prevailing at the reporting date. When a foreign operation is sold, or is
otherwise partially or completely disposed of, the translation differences accumulated in equity
are reclassified in profit or loss as part of the gain or loss on the sale.
Adoption of new and amended IFRS standards
As of January 1, 2024, Outokumpu has applied the following new and amended standards,
interpretations and decisions.
•
Amendments to IAS 7 and IFRS 7, Supplier Finance Arrangements. The amendments aim to
improve the disclosure of supplier finance arrangements (also known as reverse factoring or
supply chain financing). Entities must disclose the amount of cash flows associated with
these arrangements that were not included in the cash flow statement, any changes in the
outstanding balances related to supplier finance arrangements between the beginning and
end of the reporting period, and the nature and extent of the arrangements, including terms
and conditions. Outokumpu doesn’t have any Supplier Finance Arrangements according to
IFRS 7.
•
Amendments to IAS 1 Presentation of Financial Statements, Classification of Liabilities as
Current or Non-current, Non-current Liabilities with Covenants. The amendments aim to
provide clearer guidance and reduce the risk of liabilities being incorrectly classified due to
technical breaches of covenants. Entities must disclose information about the nature of the
covenants and any breaches that occurred, including details of any waivers or amendments
received after the reporting period but before the Financial Statements are authorized for
issue.
•
Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback. The amendments
specify that, in measuring the lease liability subsequent to the sale and leaseback, the
seller-lessee determines ‘lease payments’ and ‘revised lease payments’ in a way that does
not result in the seller-lessee recognizing any amount of the gain or loss that relates to the
right of use that it retains.
The new and amended standards, interpretations and decisions did not have material impact
on Outokumpu’s consolidated Financial Statements.
Outokumpu Annual Report 2024
171
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2. Business result
In 2024, Outokumpu’s sales and adjusted EBITDA decreased significantly compared to the previous year, reflecting a weaker part of
the stainless steel cycle. Profitability was negatively impacted by both lower stainless steel deliveries as well as weaker realized
prices for stainless steel. Despite challenging conditions, Outokumpu maintained its strong financial position.
2.1 Operating segments
Outokumpu’s business is divided into three business areas which are Europe, the Americas, and
Ferrochrome. The business areas have responsibility for commercial activities, supply chain
management and operations and they are Outokumpu’s operating segments under IFRS.
In addition to the business area structure, Group Functions cover Legal and compliance, Health
and safety, Procurement, Finance, Treasury and IR, Strategy, HR, Group communications, R&D,
Technology, Sustainability and Group IT.
Europe consists of both coil and plate operations in Europe. The high-volume and tailored
standard stainless steel grades are primarily used for example in architecture, building and
construction, transportation, catering and appliances, chemical, petrochemical and energy
sectors, as well as other process industries. The production facilities are located in Finland,
Germany and Sweden. The business area has an extensive service center and sales network
across Europe, Middle East, Africa and APAC region.
Americas produces standard austenitic and ferritic grades as well as tailored products. Its
largest customer segments are automotive and transport, consumer appliances, oil and gas,
chemical and petrochemical industries, food and beverage processing, as well as building and
construction industry. The business area has production units in the US and Mexico.
Ferrochrome produces charge grade of ferrochrome. The business area has a chrome mine in
Kemi, Finland and ferrochrome smelters in Tornio, Finland.
Other operations consist of activities outside the three operating segments, as well as
industrial holdings, non-core businesses and strategic group level investments. Such business
development expenses, Corporate Management expenses and other extraordinary costs that
are not part of business area performance assessment and not allocated to the business areas
are also reported under Other operations. Sales of Other operations consist of sales of
electricity to the Group’s production facilities in Finland and in Sweden, sales of non-core
businesses and internal services.
Sales, € million
2020*
2021
2022
2023
2024
0
2,500
5,000
7,500
10,000
Adjusted EBITDA, € million
2020*
2021
2022
2023
2024
0
300
600
900
1200
1500
Earnings per share, €
2020*
2021
2022
2023
2024
-0.50
0.00
0.50
1.00
1.50
2.00
2.50
* Including discontinued operations
Outokumpu Annual Report 2024
172
Adjusted EBITDA EUR
177
million
Net result EUR
-40
million
Earnings per
share EUR
-0.09
Sales EUR
5.9
billion
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Reconciliation
2024
€ million
Europe
Americas
Ferrochrome
Operating
segments total
Other operations
Eliminations
Group
External sales
4,044
1,707
180
5,930
11
—
5,942
Inter-segment sales
58
—
289
347
175
-522
—
Sales
4,102
1,707
469
6,277
186
-522
5,942
Adjusted EBITDA
58
59
106
223
-46
-1
177
Items affecting comparability in EBITDA
Loss on disposal of shares in Group companies and
businesses
—
—
—
—
-3
—
-3
Litigation provisions
—
-2
—
-2
—
—
-2
Restructuring costs
-5
—
—
-5
-2
—
-7
Inventory revaluations
2
—
—
2
—
—
2
Environmental
—
-5
—
-5
—
—
-5
EBITDA
55
51
106
212
-50
-1
162
Depreciation and amortization
-115
-33
-58
-206
-14
—
-220
Impairments
7
0
—
7
—
—
7
Operating profit (EBIT)
-52
18
48
14
-64
-1
-51
Assets in operating capital
2,948
944
986
4,879
297
-168
5,008
Other assets
453
Deferred tax assets
504
Total assets
5,965
Liabilities in operating capital
989
370
123
1,482
182
-152
1,513
Other liabilities
698
Deferred tax liabilities
6
Total liabilities
2,217
Operating capital
1,959
574
863
3,396
115
-16
3,495
Return on operating capital (ROOC), %
-3.0
4.2
5.5
Outokumpu Annual Report 2024
173
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Reconciliation
2023
€ million
Europe
Americas
Ferrochrome
Operating
segments total
Other operations
Eliminations
Group
External sales
4,749
1,883
207
6,840
121
—
6,961
Inter-segment sales
69
8
260
337
287
-624
—
Sales
4,818
1,892
467
7,177
408
-624
6,961
Adjusted EBITDA
148
285
96
529
-18
6
517
Items affecting comparability in EBITDA
Loss on disposal of shares in Group companies and
businesses
—
—
—
—
-26
—
-26
Onerous contracts provisions
-7
—
—
-7
—
—
-7
Restructuring costs
-26
-16
-3
-45
-5
—
-50
Inventory revaluations
-20
—
—
-20
—
—
-20
EBITDA
96
270
93
458
-49
6
416
Depreciation and amortization
-119
-60
-50
-228
-14
—
-242
Impairments
-8
-264
-2
-274
—
—
-274
Operating profit (EBIT)
-31
-54
41
-44
-107
51
-100
Assets in operating capital 1)
2,843
940
1,018
4,801
293
-222
4,871
Other assets
602
Deferred tax assets
454
Total assets
5,927
Liabilities in operating capital 1)
993
346
125
1,463
226
-208
1,480
Other liabilities
653
Deferred tax liabilities
31
Total liabilities
2,165
Operating capital 1)
1,850
594
894
3,338
67
-15
3,390
Return on operating capital (ROOC), %
1.5
25.8
5.0
1) The data for other operations and eliminations has been revised.
Outokumpu Annual Report 2024
174
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Items affecting comparability in EBITDA and EBIT
€ million
2024
2023
Restructuring costs
-7
-50
Environmental
-5
—
Loss on disposal of shares in Group companies and
businesses
-3
-26
Inventory revaluations
2
-20
Onerous contracts provisions
—
-7
Litigation provisions
-2
—
Items affecting comparability in EBITDA
-15
-102
Impairments on non-current assets
7
-272
Items affecting comparability in EBIT
-8
-374
In 2024, the German restructuring provisions of 2023 were revised which led to an increase of
EUR 5 million. At the same time, the impairment of EUR 5 million recognized in 2023 was
reversed. The environmental items of EUR 5 million are related to flooding that was caused by
torrential rains in San Luis Potosí, Mexico. The loss on the disposal of shares in Group
companies and businesses of EUR 3 million is due to a final escrow account agreement relating
to the sale of Long Products businesses in 2023.
In 2023, Outokumpu recognized items affecting comparability relating to the sale of the
remaining Long Products business in Degerfors and Storfors, Sweden, with a loss of EUR 26
million; an onerous contracts provision of EUR 7 million related to the metal powder plant in
Germany; and a propane-related inventory write-down of EUR 20 million. Outokumpu also
recognized restructuring costs totaling EUR 50 million, of which EUR 26 million is related to
restructuring in Germany and EUR 16 million to the renegotiated hot rolling agreement in
business area Americas; regarding these two items, impairments of EUR 5 million and EUR 264
million were also booked, respectively.
Accounting principles
Outokumpu’s CEO, supported by the Leadership Team, is the Group’s chief operating decision
maker. The segments are reviewed regularly for the purpose of assessing performance and
allocating resources to segments. The review is based on internal management reporting on
IFRS based financial information.
Adjusted EBITDA
Adjusted EBITDA is Outokumpu’s main performance indicator in financial reporting, and is also
used to assess the segments’ performance. Adjusted EBITDA is defined as EBIT before
depreciation, amortization and impairment charges, and excluding such material income and
expense items which affect the comparability between periods due to their unusual nature, size
or incidence resulting from, for example, Group-wide restructuring programs or disposals of
assets or businesses.
Adjusted EBITDA is an alternative performance measure, meaning that it is not an IFRS-
defined measure. It is defined also in the Reconciliation of alternative performance measures
section within the Review by the Board of Directors and reconciled to the consolidated
statement of income. Alternative performance measures are unaudited.
Operating capital and ROOC
Segment assets and liabilities resulting in the operating capital are allocated to the segments
based on the operations and the physical location of the assets and are measured the same
way as in the Financial Statements.
Return on operating capital (ROOC) is a key figure for the segment reporting and it is an
internal measure for the value the business areas generate to the capital invested in their
operations. The formula for calculating Return on operating capital (ROOC) is presented in the
Review by the Board of Directors section Definitions of financial key figures.
Outokumpu Annual Report 2024
175
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2.2 Revenue
External sales by geographical destination
€ million
Finland
Germany
Italy
The
UK
Poland
Other
Europe
North
America
APAC
region
Other
countries
Group
2024
Operating
segment
Europe
199
1,124
704
235
195
1,156
92
291
48 4,044
Americas
—
—
—
0
—
—
1,691
6
10 1,707
Ferrochrome
14
22
14
7
0
89
21
11
1
180
Other operations
9
3
—
0
—
0
—
—
—
11
222
1,148
718
243
195
1,244
1,805
307
59 5,942
2023
Operating
segment
Europe
222
1,360
977
252
202
1,243
105
318
70 4,749
Americas
—
—
—
0
—
—
1,856
5
22 1,883
Ferrochrome
13
26
13
3
0
87
21
44
0
207
Other operations
8
45
17
5
—
31
13
2
—
121
243
1,431
1,007
261
202
1,361
1,995
368
91 6,961
The presentation of the external sales by geographical destination has been revised compared to 2023.
Accounting principles
Outokumpu generates revenue mainly from sales of stainless steel and ferrochrome.
Outokumpu ships these goods to customers under a variety of Incoterms, and considers the
physical possession as well as risks and rewards related to the ownership of the goods
to be transferred accordingly. This also signifies the transfer of control of the goods to the
customer.
Outokumpu’s performance obligations related to sale of stainless steel and ferrochrome are
satisfied and revenue from contracts with customers recognized at a point of time. Only revenue
from the performance obligation related to transportation of the goods is recognized over a
period of time, and the period under which the revenue is recognized is relatively short.
Moreover, the timing of revenue recognition does not have an impact when assessing the
uncertainty associated with future cash flows, as the sales of goods and transportation service
are billed from the customer on the same invoice. Outokumpu acts as a principal with regards
to transportation of goods. The amount of the remaining performance obligations related to the
transportation service was immaterial at the end of 2024.
Outokumpu has bill-and-hold arrangements with selected European customers. Under these
arrangements, based on a customer request, Outokumpu holds the readily available material at
its own stock locations for the customer for up to a period of three months before the actual
delivery of the material. Outokumpu has transferred control of these materials to the customer
as Outokumpu is not able to direct the material to another customer, and consequently
recognizes the revenue for the material sales. The revenue related to Outokumpu’s
transportation service performance obligation to deliver the material is recognized over the time
when the delivery takes place. At the end of 2024, the amount of revenue recognized under the
bill-and-hold arrangements for products not yet delivered was immaterial.
Stainless steel and ferrochrome sales prices are mainly fixed before delivery, and volume
discounts estimated and accrued in the revenue recognition are the only variable component in
pricing. In individual cases, the sales price of ferrochrome is based on the period of time when
the customer uses the purchased ferrochrome. The payment terms vary from advance payment
to 90 days payment term, and do not include any significant financing component.
Outokumpu can sell nickel procured under Group’s nickel sourcing agreement. These sales
are recognized to revenue when the title to the material is transferred to the buyer.
Liabilities related to customer contracts are presented in note 4.5.
Outokumpu does not have individual significant customers as defined in IFRS 8.
Outokumpu Annual Report 2024
176
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2.3 Cost of sales and selling, general and administrative expenses
€ million
2024
2023
Cost of sales
-5,710
-6,474
Selling and marketing expenses
-71
-73
Administrative expenses
-240
-260
Research and development expenses
-15
-14
Total
-6,035
-6,821
Cost of sales and selling, general and administrative expenses by nature
€ million
2024
2023
Materials
-3,094
-3,671
Supplies
-619
-737
Energy
-360
-461
Maintenance
-239
-226
Freight
-250
-248
Employee benefits
-714
-712
Depreciation and amortization
-220
-242
Other
-539
-524
Total
-6,035
-6,821
Depreciation and amortization by function
€ million
2024
2023
Cost of sales
-211
-233
Selling and marketing expenses
0
0
Administrative expenses
-8
-7
Research and development expenses
-1
-1
Total
-220
-242
Auditor fees
€ million
2024
2023
Audit
-2.9
-2.9
Audit-related services
—
—
Tax advisory
-0.1
-0.1
Other services
-0.2
-0.2
Total
-3.2
-3.2
PricewaterhouseCoopers has provided non-audit services to Outokumpu in total of EUR 0.3 million during
2024 (2023: EUR 0.3 million). These services comprised of Sustainability Statement audit and other
agreed-upon procedures.
Accounting principles
Cost of sales
Cost of sales includes expenses related to materials and supplies, energy, maintenance and
freight. Employee benefit expenses, depreciation and amortization and other expenses are
included to the extent they relate to operational activities.
Research and development costs
As a main rule, research and development costs are expensed as incurred. If development is
expected to generate future economic benefits for the Group, related costs are capitalized as
intangible assets and amortized on a systematic basis over their useful lives.
Repairs and maintenance costs
Ordinary repairs and maintenance is carried out to maintain operating conditions of the mills
and the equipment, and the related costs are expensed as they are incurred.
The costs of major repairs and renovations are included in the asset’s carrying amount as
capital expenditure when these activities are expected to generate future economic benefits for
the Group, for example in form of a longer useful life, a wider product range, a higher output, or
an improved quality, in excess of the originally assessed standard performance level.
Depreciation and amortization methods and useful lives of non-current assets
Depreciation and amortization methods as well as estimates for useful lives of different types of
intangible asset and property, plant and equipment items are described in the note 4.1.
Outokumpu Annual Report 2024
177
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2.4 Other operating income and expenses
Other operating income
€ million
2024
2023
Exchange gains and losses from foreign exchange derivatives
12
-2
Market price gains and losses from commodity derivatives
11
10
Market price gains and losses from derivative financial
instruments
23
8
Sale of services and rental income
9
7
Gains on sale of non-current assets
5
33
Gains from disposal of subsidiaries and businesses
3
—
Insurance compensation
1
6
Other income items
16
8
Total
57
62
Other operating expenses
€ million
2024
2023
Exchange gains and losses from foreign exchange derivatives
-6
—
Market price gains and losses from commodity derivatives
-1
—
Market price gains and losses from derivative financial
instruments
-7
—
Impairments and impairment reversals in non-current assets
7
-274
Loss on disposal of shares in Group companies and
businesses
-3
-26
Loss on sale of non-current assets
-4
0
Other expense items
-9
-2
Total
-15
-302
In 2024, other operating income includes EUR 3 million of gains from disposal of subsidiaries
and businesses, which is related to the sale of Mexico branch distribution business in Mexico
City, Guadalajara and Monterrey. More information on the disposal in note 6.2.
In 2024, other operating expenses includes EUR 7 million of impairments and impairment
reversals in non-current assets, which is related to impairment reversals of right-of-use assets in
Germany.
In 2023, the gain on sale of non-current assets is mainly related to the sale of emission
allowances amounting to EUR 29 million. Impairments in non-current assets are mainly related
to impairment in business area Americas (EUR 264 million) and impairments in Germany (EUR
8 million) related to restructuring and the metal powder plant. Loss on disposal of shares in
Group companies and businesses is related to the sale of Degerfors.
Accounting principles
Other operating income and expenses include items such as gains or losses from disposals of
non-current assets or businesses and gains or losses from derivative financial instruments that
are not hedge accounted or do not relate to the Group’s financing activities. Other operating
income also includes rental and lease income, insurance compensations and government and
other grants and support.
Grants and other support are recognized as income over the same periods as the costs they
are intended to compensate. Investment grants related to purchases of non-current assets are
deducted from the cost of the asset and recognized as income on a systematic basis as a
reduction in depreciation or amortization over the useful life of the asset.
Other operating expenses include costs related to emission allowances and impairment
losses related to non-current assets.
Outokumpu Annual Report 2024
178
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2.5 Financial income and expenses
€ million
2024
2023
Interest income
11
16
Other financial income
2
5
Interest income and other financial income
13
21
Interest expenses
Debt at amortized cost
-17
-19
Factoring
-22
-19
Lease liabilities
-13
-10
Employee benefit obligations
-7
-7
Other interest expenses
-6
-5
Interest expenses
-64
-60
Capitalized interests
—
2
Fees related to committed credit facilities
-7
-6
Other fees
-3
-4
Other financial expenses
-10
-9
Exchange gains and losses
Derivatives
64
-5
Cash, loans and receivables
-50
16
Other market price gains and losses
Derivatives
5
5
Other
1
-4
Market price gains and losses
20
11
Total
-41
-37
Exchange gains and losses in the consolidated statement of income
€ million
2024
2023
In sales
-5
7
In purchases
-17
9
In other operating income and expenses
6
-2
In financial income and expenses
14
11
Total
-2
24
Exchange gains and losses include EUR 71 million of net exchange gain on derivative financial
instruments (2023: EUR 7 million net exchange loss) of which a gain of EUR 6 million (2023:
EUR 2 million loss) has been recognized in other operating income and expenses and a gain of
EUR 64 million (2023: EUR 5 million loss) in financial income and expenses.
Accounting principles
Financial income includes mainly interest income on cash and cash equivalents and defined
benefit plans.
Financial expenses include mainly interest expenses of borrowings, lease liabilities, factoring
and defined benefit plans.
Other income and expenses include fees related to commitment credit facilities, other
financial fees and capitalized interests.
Exchange gains and losses include exchange and other market price gains and losses on
cash, debt and receivables and derivatives related to Group’s financing activities.
Exchange and other market price gains and losses on operative items and related derivative
instruments are recognized in EBIT. Exchange and other market price gains and losses on
financing items and related derivative instruments are recognized in financial income and
expenses.
Outokumpu Annual Report 2024
179
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2.6 Income taxes
Income taxes in the consolidated statement of income
€ million
2024
2023
Current taxes
-10
-23
Deferred taxes
59
45
Total
49
22
Reconciliation of income taxes in the consolidated statement of income
€ million
2024
2023
Result before taxes
-89
-133
Income taxes at Finnish tax rate of 20%
18
27
Difference between Finnish and foreign tax rates
-1
-1
Non-deductible expenses and tax exempt income
-5
0
Current year result for which no deferred tax asset has been
recognized
0
—
Changes in deferred tax recognition
37
10
Group company disposals
-1
-5
Taxes for prior years
1
-6
Tax rate changes and other changes in tax laws
0
-3
Associated companies
1
1
Total
49
22
Accumulated deferred taxes recognized in equity
€ million
2024
2023
Deferred tax on convertible bonds equity component
0
-1
Net investment hedging
-4
-4
Remeasurements of the net defined benefit liability
65
69
Derivatives
-2
-2
Total
58
63
Outokumpu Annual Report 2024
180
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Deferred tax assets and liabilities
Jan 1, 2024
Movements
Dec 31, 2024
€ million
Net deferred tax assets
(+) and liabilities (-)
Reclassifications
Recognized in profit or
loss
Recognized in other
comprehensive income or
directly in equity
Translation differences
Net deferred tax assets
(+) and liabilities (-)
Intangible assets
8
—
-1
—
0
7
Property, plant and equipment
-97
-1
8
—
-1
-90
Right-of-use assets
-25
1
-10
—
0
-34
Inventories
-11
—
12
—
0
2
Net derivative financial assets
-3
—
2
0
0
-1
Other financial assets
6
—
3
—
0
9
Employee benefit obligations
26
—
-1
-4
0
21
Other financial liabilities
5
1
1
—
0
6
Lease liabilities
38
-1
7
—
0
44
Provisions
14
0
-1
—
0
13
Tax losses and tax credits
461
0
39
—
21
520
Net deferred tax assets
423
0
59
-5
21
498
Deferred tax assets
454
504
Deferred tax liabilities
-31
-6
Jan 1, 2023
Movements
Dec 31, 2023
€ million
Net deferred tax assets
(+) and liabilities (-)
Reclassifications
Recognized in profit or
loss
Recognized in other
comprehensive income or
directly in equity
Translation differences
Net deferred tax assets
(+) and liabilities (-)
Intangible assets
8
0
0
—
0
8
Property, plant and equipment
-189
9
83
—
0
-97
Right-of-use assets
-26
—
2
—
0
-25
Inventories
3
1
-14
—
0
-11
Net derivative financial assets
2
0
3
-8
0
-3
Other financial assets
31
-2
-24
—
0
6
Employee benefit obligations
16
-16
21
5
0
26
Other financial liabilities
5
0
0
—
0
5
Lease liabilities
39
—
0
—
0
38
Provisions
1
16
-3
—
0
14
Tax losses and tax credits
500
-9
-23
—
-8
461
Net deferred tax assets
390
0
45
-2
-9
423
Deferred tax assets
390
454
Deferred tax liabilities
0
-31
Right-of-use assets and lease liabilities have been presented separately compared to the 2023 Financial Statements.
Outokumpu Annual Report 2024
181
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Tax losses and related deferred tax assets
Tax losses carried
forward
Recognized deferred
tax assets
Unrecognized
deferred tax assets
€ million
2024
2023
2024
2023
2024
2023
Expire later than in 5 year
1,093
1,090
253
238
12
25
Never expire
1,056
967
267
222
—
—
Total
2,150
2,056
520
461
12
25
Tax losses by country
€ million
2024
2023
Finland
79
94
Germany
234
169
Sweden
197
198
The US
1,400
1,358
The UK
186
179
Other countries
54
58
Total
2,150
2,056
As of December 31, 2024, Outokumpu Group has recognized a deferred tax asset on all
material tax losses. The tax attributes of the Outokumpu Group for which no deferred tax asset
has been recognized relate to a portion of the US state tax losses which are estimated to expire
before utilization.
In 2024, the Group has released uncertain tax positions amounting to EUR 19 million.
No deferred tax liabilities were recorded on undistributed profits of foreign subsidiaries, as such
profits are not to be distributed in the foreseeable future.
Management judgements
Outokumpu operates and earns income in numerous countries and is subject to changes in tax
laws in multiple jurisdictions. When recognizing income tax liabilities, material judgments and
estimates need to be made on tax uncertainties.
In deferred tax asset recognition, the management assesses whether the realization of
future tax benefits is sufficiently probable to support the recognition. This assessment requires
judgment regarding, for example, realizable benefits from future taxable income, available tax
strategies, as well as other positive and negative factors. The recorded amount of deferred tax
assets could be reduced as a result of changes in these estimates or in tax regulations
imposing restrictions on the utilization of future tax benefits.
Accounting principles
Current and deferred income taxes are determined on entity level to the extent an entity is
subject to income taxation. The income taxes in the consolidated statement of income include
the Group companies’ current income taxes based on taxable profit for the period, tax
adjustments for previous periods, and the change in deferred income taxes. In several countries
(Finland, Germany, the Netherlands, Sweden, and the US) Outokumpu companies are included
in income tax consolidation groups or group taxation systems. The share of results in
associated companies is reported in the statement of income based on the net result and thus
including the income tax effect.
Deferred income taxes are stated using the balance sheet liability method to reflect the net
tax effects of temporary differences between the assets and liabilities’ carrying amounts in the
Financial Statements and the corresponding tax basis at the reporting date, as well as for
unused tax loss or credit carry forwards.
Deferred tax assets are recognized for all deductible temporary differences to the extent that
it is probable that future taxable profits will be available for utilization of these differences. A
valuation allowance is recognized if the realization of the tax benefits is not probable. The
ability to recognize deferred tax assets is reviewed at the end of each reporting period.
Deferred tax liabilities are usually recognized in the statement of financial position in full.
As an exception, deferred tax liabilities are not recognized if they arise from initial
recognition of an asset or a liability in a transaction that is not a business combination and that
does not affect the accounting nor taxable profit at the time of the transaction.
Deferred taxes are calculated at the enacted or substantially enacted tax rates that are
expected to apply by the end of the reporting period. Generally, deferred tax is recognized to
the statement of income. However, if the taxes are related to items of other comprehensive
income or to transactions or other events recognized directly in equity, the related income taxes
are also recognized either in other comprehensive income or directly in equity, respectively.
The Group is within the scope of the OECD Pillar Two model rules. Pillar Two legislation was
implemented in Finland, the jurisdiction in which Outokumpu Corporation is incorporated, based
on the EU Directive, and is effective from January 1, 2024. The Group has not recognized any
material tax expense related to the top-up tax in 2024. The Group has applied a temporary
mandatory relief from deferred tax accounting for the potential impacts of the top-up tax and
would account for it as a current tax if it would incur. Management assesses that the risk for
any exposure to top-up tax for the Group is limited.
Outokumpu Annual Report 2024
182
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2.7 Earnings per share
2024
2023
Net result attributable to the equity holders of the parent
company, € million
-40
-106
Interest expenses on convertible bonds, net of tax, € million
8
8
Adjusted net result attributable to the equity holders of the
parent company, € million
-31
-98
Net result attributable to the equity holders of the parent
company, continuing operations, € million
-40
-111
Interest expenses on convertible bonds, net tax, continuing
operations, € million
8
8
Adjusted net result attributable to the equity holders of the
parent company, continuing operations, € million
-31
-103
Adjusted weighted average number of shares, in thousands
424,238
435,090
Adjusted diluted weighted average number of shares, in
thousands
470,977
475,844
Earnings per share, €
-0.09
-0.24
Diluted earnings per share, €
-0.09
-0.24
Earnings per share, continuing operations, €
-0.09
-0.26
Diluted earnings per share, continuing operations, €
-0.09
-0.26
Diluted earnings per share has been revised for the comparative period.
Diluted earnings per share equals to earnings per share as potential ordinary shares have
antidilutive impact.
In 2024, Outokumpu repurchased 8,357,545 treasury shares as part of a share buyback
program started in 2023. More information on the programs are presented in note 5.2.
In 2023, Outokumpu repurchased 13,903,534 treasury shares as part of two different share
buyback programs of which one started in 2022 and the other in 2023. More information on
the programs are presented in note 5.2.
Accounting principles
Basic earnings per share is calculated by dividing the net result attributable to
the equity holders of the company by the adjusted weighted average number of shares
outstanding during the period, excluding shares held by Outokumpu as treasury shares.
In a share issue, when shares are offered at discount compared to market price, the pro-
portion of the issue representing the discount is retrospectively adjusted to the weighted
average number of shares.
Diluted earnings per share is calculated by adjusting the adjusted weighted average number
of ordinary shares outstanding with the assumption that convertible instruments are converted.
The profit or loss used in the calculation is adjusted for the interest expense related to the
instrument and recognized in the period, net of tax. In addition, the shares estimated to be
delivered based on the share-based incentive programs are taken into account. However,
potential ordinary shares are only dilutive if the adjustments decrease the earnings per share
ratio.
Outokumpu Annual Report 2024
183
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
3. Employee benefits
Outokumpu’s number of personnel decreased slightly during 2024, and at the end of December, full-time equivalent number of
personnel was 8,424. Employee benefit expenses remained stable in 2024, but with increased pressure from wages and salaries
due to tight labour markets and the past years’ inflationary environment.
3.1 Employee benefit expenses
€ million
2024
2023
Wages and salaries
-547
-531
Termination benefits
-4
-18
Social security costs
-97
-98
Post-employment and other long-term employee benefits
Defined benefit plans
-3
-3
Defined contribution plans
-50
-50
Other long-term employee benefits
-7
-7
Share-based payments
-2
-1
Other employee benefit expenses
-4
-4
Total
-714
-712
Total employee benefit
expenses EUR
-714 million
Number of personnel
at the end of period (FTE)
8,424
Employee benefit expenses, € million
2020*
2021
2022
2023
2024
0
200
400
600
800
Personnel on December 31, FTE
2020*
2021
2022
2023
2024
0
2,000
4,000
6,000
8,000
10,000
*Including discontinued operations
In 2024, Outokumpu has redefined personnel, full time equivalent (FTE) measure, FTE is excluding interim
workforce. Comparison year 2023 has been revised accordingly.
Outokumpu Annual Report 2024
184
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
3.2 Employee benefits for key management
€ thousands
2024
2023
Short-term employee benefits
4,677
6,438
Post-employment benefits 1)
614
240
Share-based payments
506
447
Remuneration to the Board of Directors
948
918
6,745
8,043
1) Contains only supplementary pensions.
The decrease in short-term employee benefits is due to short-term incentives. The increase in
post employment benefits is due to the new supplementary pension plan added to the CEO
remuneration in 2024 and reorganizing pensions in Germany.
Key management includes nine (nine) members of the Outokumpu Leadership Team and seven
(eight) members of the parent company Outokumpu Corporation’s Board of Directors. On
December 31, 2024, President and CEO, CFO, Presidents of the core business areas and
business lines, Chief Technology Officer, Executive Vice President, Sustainability, Strategy and
People, and Executive Vice President, General Counsel are part of the Outokumpu Leadership
Team. In July, the Executive Vice President, General Counsel was appointed to the Leadership
Team. The number of Leadership Team members, however, remained unchanged, since Marc-
Simon Schaar was not replaced in his Chief Procurement Officer role when he took over the CFO
role from Pia Aaltonen-Forsell in June 2024. In October 2024, Rolf Schencking started as
President, business line Advanced Materials, replacing Thomas Anstots, who retired. On October
1, 2024, Kati ter Horst started as President and CEO of Outokumpu. She resigned from the
Board on September 30, 2024, and was not replaced as a Board member.
Key management shareholdings can be found in the Corporate Governance statement.
Employee benefits for the CEO
Recognized in profit or loss
Remuneration paid
€ thousands
2024
2023
2024
2023
Salaries and short-term benefits
964
1,003
964
1,003
Short-term incentives
106
516
622
871
Post-employment benefits
330
259
330
259
Share-based payments
35
111
507
729
1,435
1,888
2,423
2,863
The CEO participates in the Finnish TyEL pensions system. The post-employment benefits are the sum of
the statutory pension, calculated based on the general TyEL contribution percentage of the employer, and
the supplementary pension was added to the CEO’s remuneration package in 2024.
Remuneration paid to Board of Directors
€ thousands
2024
2023
Chairman Kari Jordan
203
193
Vice Chairman Kati ter Horst, until September 30, 2024
121
120
Member Heinz Jörg Fuhrmann
104
94
Member Päivi Luostarinen
92
93
Member Jyrki Mäki-Kala, as of March 30, 2023
113
106
Member Karl-Petter Söderström
92
92
Member Vesa-Pekka Takala, until March 30, 2023
—
8
Member Pierre Vareille
107
98
Member Julia Woodhouse
117
113
Total
948
918
Remuneration of the CEO
CEO Heikki Malinen decided in May 2024 to leave Outokumpu. Kati ter Horst became President
and CEO of Outokumpu on October 1, 2024. Kati ter Horst joined Outokumpu from the Belgian
company Aliaxis S.A., the world leader in fluid management systems. She was also a member of
the Outokumpu Board of Directors from 2016 to 2024.
The remuneration of the CEO consists of a base salary, benefits and an annually determined
short-term incentive plan. In addition, the CEO participates in long-term incentives comprising
performance share plans launched on a yearly basis.
In 2024, the CEO’s short-term incentive earning opportunity stayed unchanged at 50% of the
annual gross base salary on a target level and 100% on a maximum level. Heikki Malinen
received a short-term incentive for 2023 results, and Kati ter Horst received a sign-on bonus.
No short-term incentive will be paid to the CEO for 2024 results.
In 2024, the long-term incentive target and maximum levels remained at 50% and respectively
75% of the annual base salary at time of grant. Heikki Malinen received a share reward based
on the performance from 2021 to 2023. No long-term incentive will be paid to the CEO for the
performance from 2022 to 2024, since Heikki Malinen resigned and Kati ter Horst was not
included in that plan.
The members of Outokumpu’s Leadership Team, including the CEO, are expected to own
Outokumpu shares they receive in the company’s share-based incentive programs
corresponding to at least the value of their annual gross base salary. Half of the net shares
received from the share-based incentive programs must be used to fulfil that ownership
recommendation.
The service contract of the CEO is valid until further notice. The notice period was 6 months for
Heikki Malinen, but is extended to 9 months for Kati ter Horst. For the company, the notice
period remains 6 months, and the severance payment in such a case also stays 12 months.
Kati ter Horst’s retirement age is 65 years, like it was for her predecessor. Besides the
Outokumpu Annual Report 2024
185
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
supplementary pension plan specified above, she participates in the Finnish statutory pension
system, like was Heikki Malinen’s case.
Remuneration of the Board of Directors
Outokumpu’s Annual General Meeting approved the annual remuneration to the members of the
Board of Directors. 40% of the annual fee was paid in the company’s own shares using treasury
shares, unless a Board member already owned shares for a value exceeding the annual
remuneration and choose to increase their cash portion. The annual fee is paid once a year,
and in addition to the annual remuneration, all the members of the Board of Directors are paid
a fee for each meeting they attend. The members of the Board are not entitled to any other
share-based rewards. The Board members are not eligible for any pension schemes.
Accounting principles
Employee benefits for the key management include the benefits to each Leadership Team or
Board of Directors member for the time they hold these positions.
Employee benefits are presented based on expenses recognized in profit or loss during the
year on accrual basis except for the CEO whose remuneration is presented also based on paid
benefits during the year. The remuneration to Board of Directors is also presented on paid
basis.
Short-term incentives are recognized to profit or loss during the period they relate to whereas
bonuses are typically paid out during the following financial year. Expenses on share-based
payments are recognized to profit or loss at the share price on the grant date of the benefit and
over the period when the benefit is earned. Share-based benefits are reported as paid when
delivered and at the share price on the delivery date.
3.3 Employee benefit obligations
Outokumpu has several defined benefit and defined contribution plans in various countries. The
most significant defined benefit plans are in Germany and the UK, representing 44% and 53%
of the Group’s total defined benefit obligation, respectively.
Funding requirements of the defined benefit plans are generally based on the pension fund’s
actuarial measurement framework set out in the funding policies and local regulation.
Germany
Outokumpu has several defined benefit plans in Germany, of which major plans include a
management plan, open pension plans for other staff, and other pension obligations, which are
nearly all closed for new entrants. Basis to all pension obligations in Germany are bargaining
agreements and/or individual contracts (management obligations). The management plan and
other pension obligations are based on annuity payments, whereas plans for other employees
are based on one lump sum payment after retirement.
In addition, all the obligations in Germany are embedded in the BetrAVG law. The law contains
rules for vested rights, pension protection scheme and regulations for the pension adjustments.
In Germany, no funding requirements exist, and the plans are funded only for a small part with a
CTA model (Contractual Trust Arrangement) that was introduced in 2019.
The UK
The AvestaPolarit Pension Scheme (the Scheme) is registered under UK legislation and is
contracted out of the State Second Pension. The Scheme is subject to the funding
requirements outlined in UK legislation. The Scheme’s trustee is responsible for the operation
and governance of the Scheme, including decisions regarding the Scheme’s funding and
investment strategy.
In December 2021, a GBP 390 million buy-in contract was implemented. This buy-in completed
the Scheme’s de-risking process which began with an initial buy-in in 2020, when a GBP 110
million buy-in insurance solution was implemented.
A buy-in removes risks of investment, longevity, interest rate changes and inflation for the
Scheme and is held as a Scheme asset. Until a buy-out is secured, the Scheme ultimately
remains the responsibility of Outokumpu Stainless Ltd.
However, as a result of the buy-in arrangement, the risks related to the Scheme’s obligation are
now significantly reduced and mostly covered by insurance. Outokumpu has agreed with the
trustees to hold cash in an escrow account to provide for small mismatches in the insurance
coverage and liquidity to the scheme.
At year-end 2024, the escrow balance was GBP 12 million (2023: GBP 13 million). The
actuarial gains in 2024 amounted to EUR 2.1 million (2023 EUR 0.5 million actuarial losses).
Due to the buy-in solutions, no further contributions are expected to be required as a result of
the triennial valuations. The latest valuation for this purpose was completed in 2024.
Outokumpu Annual Report 2024
186
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Defined benefit cost in profit or loss and other comprehensive income
€ million
2024
2023
In employee benefit expenses in operating profit (EBIT)
-3
-3
In financial income and expenses
-7
-7
Defined benefit cost in profit or loss
-9
-11
In other comprehensive income
12
-15
Total defined benefit cost
3
-25
Gross defined benefit obligations and plan assets
€ million
2024
2023
Present value of funded defined benefit obligations
506
522
Present value of unfunded defined benefit obligations
1
1
Fair value of plan assets
-333
-330
Net defined benefit liability
174
193
Amounts recognized in the consolidated statement of financial position
€ million
2024
2023
Net defined benefit liability
174
193
Other long-term employee benefit liabilities
22
19
Employee benefit obligations in statement of financial position
196
212
Gross defined benefit obligations and plan assets are presented in the statement of financial position
netted per plan either as a liability or an asset depending on nature of the netted item.
Movement in net defined benefit liability
2024
2023
€ million
Present
value of
obligation
Fair value
of plan
assets
Net
defined
benefit
liability
Present
value of
obligation
Fair value
of plan
assets
Net
defined
benefit
liability
Total on Jan 1
524
-330
193
504
-301
202
Current service cost
3
—
3
3
—
3
Past service cost
0
—
0
—
—
—
Interest expense/(income)
21
-15
7
21
-14
7
Remeasurements arising from
Return on plan assets
—
10
10
—
-9
-9
Demographic assumptions
-3
—
-3
-5
—
-5
Financial assumptions
-39
—
-39
20
—
20
Experience adjustment
20
—
20
9
—
9
Exchange differences
13
-13
0
6
-5
1
Employer contributions
0
-17
-17
0
-34
-34
Benefits paid
-31
31
—
-33
33
—
Settlements
0
—
0
0
—
0
Business combinations
—
—
—
-1
—
-1
Total on Dec 31
507
-333
174
524
-330
193
Germany on Dec 31
224
-67
157
233
-58
175
The UK on Dec 31
266
-262
4
273
-267
6
In this note net defined benefit liability on Jan 1, 2023 included EUR 1 million impact on
discontinued operations.
The weighted average duration of the overall defined benefit obligation is 12.4 years (2023:
13.2 years). In Germany and in the UK, the weighted average durations are 10.8 and 14.0
years (2023: 11.2 and 15.0 years) respectively.
Discount rates, rising inflation and increasing retirement age have material impact on financial
assumptions and remeasurement amounts.
The expected contributions to be paid to the defined benefit plans in 2025 are EUR 16 million
and relate mainly to the German plans.
Outokumpu Annual Report 2024
187
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Allocation of plan assets
€ million
2024
2023
Cash and cash equivalents
2
1
Insurance policies
264
271
Other assets
67
59
Total plan assets
333
330
On December 31, 2024, 0.7% of the plan assets were invested in quoted instruments (Dec 31, 2023:
0.2%).
Significant actuarial assumptions
Germany
The UK
Other countries
Discount rate, %
2024
3.36
5.50
8.09
2023
3.18
4.50
8.15
Future salary
increase, %
2024
—
—
4.50
2023
—
—
5.28
Inflation rate, %
2024
2.30
3.15
3.46
2023
2.30
3.10
3.48
Future benefit
increase, %
2024
2.30
2.65
2.05
2023
2.30
2.95
2.06
Medical cost trend
rate, %
2024
—
—
9.20
2023
—
—
4.70
Life expectancy
2024
RT 2018 G
mortality tables
96% SAPS All
Pensioner Amounts
tables with CMI Core
Projection Model -
2023
Standard mortality
tables
2023
RT 2018 G
mortality tables
96% SAPS All Pensioner
Amounts tables with
CMI Core Projection
Model - 2022
Standard mortality
tables
Sensitivity analysis of significant actuarial assumptions
Change in
assumption
Germany, %
The UK, %
Other
countries, %
2024
Discount rate
+/-0.5%
-5 / +5
-6 / +7
-3 / +3
Future benefit increase
+/-0.5%
+2 / -2
+5 / -5
+2 / -2
Medical cost trend rate
+/-0.5%
— / —
— / —
+9 / -8
Future salary increase
+/-0.5%
— / —
— / —
+3 / -3
Life expectancy
+ 1 year
— / +3
— / +3
— / +7
2023
Discount rate
+/-0.5%
-5 / +6
-7 / +7
-7 / +7
Future benefit increase
+/-0.5%
+3 / -2
+6 / -5
+2 / -2
Medical cost trend rate
+/-0.5%
— / —
— / —
+8 / -7
Future salary increase
+/-0.5%
— / —
— / —
+6 / -3
Life expectancy
+ 1 year
— / +3
— / +3
— / +7
Sensitivity is presented for reasonably possible change at the reporting date in one of the principal
assumptions, while holding all other assumptions constant.
Other long-term employee benefits
Other long-term employee benefits mainly relate to early retirement provisions in Germany and
long-service remunerations in Finland.
Under the German early retirement regulations, employees are able to retire a certain number
of years prior to their earliest pensionable age (passive phase). During a period equal in length
to the passive phase they will be working full-time with their net salary cut to 50% of their
former regular salary (active phase). During both phases the employer supplements the net
salary to match a defined percentage of the employee‘s former regular net salary. Under the
long-service remunerations in Finland, the employees are entitled to receive a one-time
indemnity every five years after 20 years of service.
Multi-employer defined benefit plans
ITP pension plans operated by Alecta in Sweden and plans operated by Stichting
Bedrijfspensioenfonds voor de metaalindustrie in the Netherlands are multi-employer defined
benefit pension plans. However, it has not been possible to get sufficient information for the
calculation of obligations and assets by employer from the plan operators, and therefore these
plans have been accounted for as defined contribution plans in the consolidated Financial
Statements.
Outokumpu Annual Report 2024
188
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Risk information
Through its defined benefit plans, Outokumpu is exposed to a number of risks, the most
significant of which are detailed below.
Asset volatility: The level of equity returns is a key factor in the overall investment return. If a
plan holds significant proportion of equities, which are expected to outperform corporate bonds
in the long-term, it might face higher volatility and risk in the short-term. The investment
portfolio might also be subject to a range of other risks typical of the assets held, in particular
credit risk on bonds and exposure to the property market.
Change in bond yields: A decrease in corporate bond yields will increase plan liabilities,
although this will be partially offset by an increase in the value of the plan’s bond holdings (if
any). In a situation where the return on plan assets is lower than the corporate bond yields, a
plan may face a shortfall which might lead to increased contributions.
Inflation risk: Inflation rate is linked to both future pension and salary increase, and higher
inflation will lead to higher liabilities.
Longevity: The majority of Outokumpu’s defined benefit obligations are to provide benefits
for the life of the member, so increases in life expectancy will result in an increase in the plans’
liabilities.
The buy-in solutions implemented in the UK in 2021 and 2020 significantly reduce the
earlier-mentioned risks for the Scheme, which is mostly covered by insurance.
Management judgements
The present value of pension obligations is subject to actuarial assumptions which are used in
calculating these obligations. These assumptions include, among others, discount rate, the
annual rate of increase in future compensation levels, inflation rate and employee turnover
rate. The assumptions are proposed by external independent actuaries separately for each
defined benefit plan or each country where Outokumpu has defined benefit plan and approved
by the management.
Accounting principles
The Group companies in different countries have various post-employment benefit plans in
accordance with local conditions and practices. The plans are classified as either defined
contribution plans or defined benefit plans.
The fixed contributions to defined contribution plans are recognized as expense in the period
to which they relate. The Group has no legal or constructive obligation to pay further
contributions if the receiving party is not able to pay the benefits in question. All such
arrangements that do not meet these requirements are defined benefit plans.
Defined benefit plans are funded with payments to the pension funds or insurance
companies. The present value of the defined benefit obligations is determined separately for
each plan by using the projected unit credit method. The liability recognized in the statement of
financial position is the defined benefit obligation less the fair value of plan assets at the
closing date. When the fair value of plan assets exceeds the value of the obligation, the net
amount is recognized as defined benefit plan assets.
Current service costs, past service costs and gains or losses on settlements are recognized
in functional costs above EBIT. Net interest expense or income is recognized in financial items
under interest expense or interest income. All remeasurements of the net defined benefit
liability (asset) are recognized directly in other comprehensive income.
Buy-in contract in the UK does not result in a settlement because Outokumpu remains
responsible for the benefit obligation. The buy-in contract is effectively an investment by which
the plan can receive payments from the insurer corresponding to the benefits due to the
participants, but ultimately the primary obligation to pay benefits has not been transferred.
For other long-term employee benefits, all service costs and remeasurements are recognized
immediately in the statement of income. Interest expenses are recognized in financial items
under interest expenses.
The significant actuarial assumptions are presented separately for the most significant
countries, and for other countries a weighted average of the assumptions is presented.
Outokumpu Annual Report 2024
189
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
3.4 Share-based payments
Share-based programs are part of the Group’s incentive and commitment-building system for
key employees. The objectives are to align the interests between key employees and
shareholders, promote shareholder value creation and the achievement of long-term strategic
targets.
Outokumpu operates two share-based programs. The Performance Share Plan (PSP) includes an
earning criterion and is part of the regular compensation of top executives, with a maximum
number of participants of 200. The Restricted Share Pool (RSP) does not have any specific
earning criterion and it is used for a limited number of employees, for key recruitments,
exceptional performance, high potential, retention needs and other individual specific
situations.
For the financial year 2024, the share-based payment expenses included in the employee
benefit expenses were EUR 2 million (2023: EUR 1 million). The total estimated value of the
share-based payment plans is EUR 7 million on December 31, 2024 (2023: EUR 13 million).
This value is recognized as an expense in the statement of income during the vesting periods.
Outstanding programs
During 2024, Outokumpu's share-based payment programs include Performance Share Plan
(periods 2022–2024, 2023–2025 and 2024–2026) and Restricted Share Pool (periods 2022–
2024, 2023–2025 and 2024–2026).
In December 2024, the Board of Directors has approved the commencement of Outokumpu’s
share-based programs, Performance Share Plan and Restricted Share Pool, for the period
2025–2027. The plans commence at the beginning of 2025.
Vested programs
In 2024, the Performance Share Plan 2021–2023 ended with the targets met in 73.3%, and
after deduction for the applicable taxes, a total of 740,681 shares were delivered to the 93
participants. From the Restricted Share Pool 2021–2023, after deductions for applicable taxes
as the last installment of three, in total 38,458 shares were delivered to the 52 participants.
From the Restricted Share Pool 2022–2024, after deductions for applicable taxes as the
second installment of three, in total 35,103 shares were delivered to the 57 participants. From
the Restricted Share Pool 2023–2025, after deductions for applicable taxes as the first
installment of three, in total 38,228 shares were delivered to the 57 participants. Shares were
delivered in February 2024, and Outokumpu used its treasury shares for the reward payments.
Share-based payment opportunity
Maximum number of shares Dec 31, 2024
2025
2026
2027
Total
PSP 2022-2024
1,066,853
—
—
1,066,853
RSP 2022-2024
195,532
—
—
195,532
1,262,385
—
—
1,262,385
PSP 2023-2025
—
2,176,950
—
2,176,950
RSP 2023-2025
56,931
56,938
—
113,869
56,931
2,233,888
—
2,290,819
PSP 2024-2026
—
—
2,665,050
2,665,050
RSP 2024-2026
122,083
122,083
122,084
366,250
122,083
122,083
2,787,134
3,031,300
Total
1,441,399
2,355,971
2,787,134
6,584,504
Outokumpu Annual Report 2024
190
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
The general terms and conditions of the outstanding share-based incentive programs
Performance Share plan
PSP 2022-2024
PSP 2023-2025
PSP 2024-2026
Grant date
March 15, 2022
March 10, 2023
March 11, 2024
Vesting period
Jan 1, 2022-Mar 31, 2025
Jan 1, 2023-Mar 31, 2026
Jan 1, 2024-Mar 31, 2027
Number of participants
91
173
191
Share price at grant date, €
4.50
5.68
3.83
Exercised
In shares and cash in 2025
In shares and cash in 2026
In shares and cash in 2027
Vesting conditions
Non-market
Return on capital employed (80%), CO2 emissions
per ton of crude steel produced (20%)
Return on capital employed (80%), CO2 emissions
per ton of crude steel produced (20%)
Return on capital employed (80%), CO2 emissions
per ton of crude steel produced (20%)
Other relevant conditions
Continuation of employment until the shares are delivered, a salary based limit for the maximum benefits
Restricted Share Pool Program
RSP 2022-2024
RSP 2023-2025
RSP 2024-2026
Grant date
March 15, 2022
March 10, 2023
March 11, 2024
Vesting period
Jan 1, 2022-Mar 31, 2025
Jan 1, 2023-Mar 31, 2026
Jan 1, 2024-Mar 31, 2027
Number of participants
57
54
57
Share price at grant date, €
4.50
5.68
3.83
Exercised
In shares and cash, either in full in 2025 or in 3
installments in 2023, 2024 and 2025
In shares and cash in 3 installments in 2024, 2025
and 2026
In shares and cash in 3 installments in 2025, 2026
and 2027
Vesting conditions
Continuation of employment until the shares are delivered, a salary-based limit for the maximum benefits
Detailed information of the share-based incentive programs can be found in Outokumpu’s home page www.outokumpu.com.
Management judgements
In valuing the share-based payment plans, the management estimates the likelihood of
achieving the non-market performance criteria and the number of participants remaining in the
plan when the vesting period ends.
The evaluation of the likelihood of achieving the non-market performance criteria uses
mainly external financial forecasts but also internal forecasts are used. The number of
participants remaining in plans at the end of the vesting period is estimated based on historical
forfeit ratios of similar plans. Also potential impacts from restructuring activities carried out in
the Group are considered in the estimate.
Accounting principles
The share-based payments are settled net of tax withholding, and they are accounted as fully
equity-settled. The expense of the programs recognized over vesting periods is based on the
grant date fair value and is reported as employee benefit expenses within the administrative
expenses in profit or loss.
Applicable statistical models are used in valuation, and the valuation is revised at the end of
each reporting period based on the likelihood of achieving the non-market performance criteria
and the estimated retention rate of the participants.
The salary-based maximum limits for the pay-outs have been taken into account in the
valuation of the benefits.
Outokumpu Annual Report 2024
191
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
4. Operating assets and liabilities
Outokumpu’s capital expenditure was EUR 216 million in 2024
and net working capital slightly decreased. Increase in
inventories was driven by higher inventory volumes partly offset
by lower metal prices. Return on capital employed was
impacted by lower profitability.
4.1 Intangible assets and property, plant and equipment
Intangible assets
2024
€ million
Goodwill
Other
intangible
assets
Total
Historical cost on Jan 1, 2024
472
332
804
Translation differences
1
0
1
Additions
—
39
39
Disposals
—
-3
-3
Reclassifications
—
2
2
Historical cost on Dec 31, 2024
473
370
843
Accumulated amortization and impairment on Jan 1, 2024
-15
-234
-249
Translation differences
-1
0
-1
Amortization
—
-14
-14
Disposals
—
1
1
Reclassifications
—
-1
-1
Accumulated amortization and impairment on Dec, 31, 2024
-16
-247
-263
Carrying value on Dec 31, 2024
457
123
580
Carrying value on Jan 1, 2024
457
98
556
In 2024, additions to the other intangible assets are mainly related to ERP implementation
project and purchases of emission allowances.
Capital expenditure, € million
2020*
2021
2022
2023
2024
0
50
100
150
200
250
Inventories, € million
2020*
2021
2022
2023
2024
0
500
1,000
1,500
2,000
Return on capital employed, %
2020
2021
2022
2023
2024
-5
0
5
10
15
20
25
*Including discontinued operations.
Outokumpu Annual Report 2024
192
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Emission allowances
Outokumpu had the following active sites operating under EU’s Emissions Trading Scheme (EU
ETS) in 2024: production plants in Tornio, Finland; Avesta, Degerfors and Nyby in Sweden; as
well as Krefeld together with Dillenburg in Germany. All Outokumpu sites met the compliance
requirements on time in 2024.
The pre-verified carbon dioxide emissions under EU ETS were approximately 0.8 million tonnes
in 2024 (2023: 0.9 million tonnes). For its 2024 emission allowance delivery, Outokumpu will
use allowances received for free, but also allowances acquired from the market in prior years.
The cost of usage has been recognized as other operating expenses. During 2024, Outokumpu
Corporation bought externally 173,861 tons of emission allowances with purchase value of EUR
10 million.
The Group’s emission position is composed of realized and forecasted carbon emissions netted
against confirmed and forecasted emission allowances granted by governments. All relevant
Outokumpu sites applied for free emission allowances for Phase IV trading period according to
the efficiency-based benchmarks and historical activity, and the allocations for the first half of
the period have been confirmed. These allocations combined with the allowances held from
prior period are adequate to cover the forecasted needs of EU emission allowances for the first
half of the trading phase (2021–2025).
The emission allowance price risk is presented in the note 5.3 under Energy price risk.
2023
€ million
Goodwill
Other
intangible
assets
Total
Historical cost on Jan 1, 2023
471
352
823
Translation differences
—
-3
-3
Additions
—
24
24
Disposals
—
-7
-7
Reclassifications
1
-35
-33
Other
—
0
0
Historical cost on Dec 31, 2023
472
332
804
Accumulated amortization and impairment on Jan 1, 2023
-15
-262
-276
Translation differences
—
3
3
Amortization
—
-13
-13
Reclassifications
0
38
37
Accumulated amortization and impairment on Dec, 31, 2023
-15
-234
-249
Carrying value on Dec 31, 2023
457
98
556
Carrying value on Jan 1, 2023
456
91
547
Reclassifications include transfers between historical cost and accumulated depreciation and impairment.
Outokumpu Annual Report 2024
193
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Property, plant and equipment
2024
€ million
Land
Mine properties
Buildings
Machinery and
equipment
Other tangible assets
Advances paid and
construction work in
progress
Group
Historical cost on Jan 1, 2024
70
307
1,228
4,240
131
174
6,150
Translation differences
1
—
10
37
0
3
51
Additions
—
0
1
9
1
172
184
Disposals
-1
—
-2
-39
-1
0
-43
Reclassifications
-1
19
23
48
7
-93
3
Other
—
—
0
0
0
0
0
Historical cost on Dec 31, 2024
70
326
1,261
4,296
137
256
6,345
Accumulated depreciation and impairment on Jan 1, 2024
-7
-56
-847
-3,246
-88
—
-4,244
Translation differences
0
—
-6
-25
0
—
-30
Disposals
—
—
1
35
1
—
37
Depreciation
—
-17
-40
-105
-6
—
-168
Impairments
—
—
0
0
—
—
0
Reclassifications
1
—
-16
17
-6
—
-4
Other
—
—
0
0
0
—
0
Accumulated depreciation and impairment on Dec 31, 2024
-6
-73
-908
-3,325
-98
—
-4,410
Carrying value on Dec 31, 2024
63
253
353
971
39
256
1,935
Carrying value on Jan 1, 2024
63
251
381
994
43
174
1,905
Reclassifications include transfers from advances paid and construction work in progress to other asset classes as well as transfers between historical cost and accumulated depreciation and impairment.
Outokumpu Annual Report 2024
194
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2023
€ million
Land
Mine properties
Buildings
Machinery and
equipment
Other tangible assets
Advances paid and
construction work in
progress
Group
Historical cost on Jan 1, 2023
76
131
1,174
4,161
132
443
6,116
Translation differences
0
—
-7
-31
0
-1
-40
Additions
—
1
3
9
1
129
143
Disposals
0
—
-1
-17
-1
-1
-19
Reclassifications
-6
175
59
119
-2
-396
-50
Other
—
—
-1
0
0
0
-1
Historical cost on Dec 31, 2023
70
307
1,228
4,240
131
174
6,150
Accumulated depreciation and impairment on Jan 1, 2023
-13
-81
-768
-2,916
-89
—
-3,866
Translation differences
0
—
3
19
0
—
22
Disposals
—
—
0
12
1
—
13
Depreciation
—
-15
-37
-135
-5
—
-192
Impairments
—
—
-58
-210
—
—
-269
Reclassifications
6
40
11
-15
6
—
48
Other
—
—
1
0
0
—
1
Accumulated depreciation and impairment on Dec 31, 2023
-7
-56
-847
-3,246
-88
—
-4,244
Carrying value on Dec 31, 2023
63
251
381
994
43
174
1,905
Carrying value on Jan 1, 2023
63
50
406
1,244
43
443
2,250
Reclassifications include transfers from advances paid and construction work in progress to other asset classes as well as transfers between historical cost and accumulated depreciation and impairment.
At the end of the year 2023, Outokumpu recognized an impairment loss of EUR 264 million related to property, plant and equipment of business area Americas.
Intangible assets and property, plant and equipment by geographical region
€ million
2024
2023
Finland
1,563
1,552
Other Europe
518
495
North America
426
406
APAC region
8
8
Other countries
0
0
2,515
2,461
Capitalized interest expenses
During 2024, no borrowing costs (2023: EUR 2 million) were capitalized on investment projects
under property, plant and equipment and intangible assets. Total capitalized interests on
December 31, 2024 were EUR 22 million (Dec 31, 2023: EUR 25 million). The average
capitalization rate used in 2023 was 1.0%.
Management judgements
Management estimates relating to useful lives and recoverable amounts affect significantly the
intangible asset and property, plant and equipment values in the consolidated statement of
financial position, and different assumptions and assigned lives could have a material impact
on the reported amounts.
Carrying amounts of intangible asset and property, plant and equipment items are regularly
reviewed for any evidence of impairment. If any such evidence emerges, the asset’s recoverable
amount is assessed, which requires estimation of future cash flows attributable to the asset
and related valuation parameters.
Indications for changes in useful lives are reviewed annually, and if changes to previous
estimates are identified, the useful lives are revised accordingly. If an impairment loss is
recognized, the estimated useful life of the asset is also reassessed.
Outokumpu Annual Report 2024
195
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Accounting principles
Intangible assets other than goodwill include capitalized development costs, patents, licenses
and software. These assets comprise mainly acquired assets that typically have definite useful
lives. An intangible asset is recognized if it is probable that the asset will generate future
economic benefits to the company and the cost of the asset can be measured reliably.
Property, plant and equipment consist mainly of facilities, machinery and equipment used in
stainless steel and ferrochrome production.
Intangible assets and property, plant and equipment are recognized initially at cost. Cost
comprises of the asset’s purchase price and all costs directly attributable to bringing the asset
ready for its intended use. Government grants received for investment purposes are deducted
from the asset’s cost. Intangible assets and property, plant and equipment acquired in a
business combination are measured at fair value at the acquisition date.
Borrowing costs (mainly interest costs) directly attributable to the acquisition of an asset are
capitalized in the statement of financial position as part of the asset’s carrying amount, when it
takes a substantial period of time to get the asset ready for its intended use.
After initial recognition, intangible assets and property, plant and equipment are measured
at cost less accumulated amortization, depreciation and impairment losses. Intangible assets
and property, plant and equipment, other than land and mine properties, are amortized or
depreciated on a straight-line basis over their expected useful lives. Assets tied to a certain
fixed period are amortized over the contract term.
Amortization of intangible assets is based on the following estimated useful lives:
Software
up to 10 years
Capitalized development costs
up to 10 years
Intangible rights
up to 20 years
Depreciation of property, plant and equipment items is based on the following estimated useful
lives:
Buildings
25–40 years
Heavy machinery
15–30 years
Light machinery and equipment
3–15 years
Self-owned land is not depreciated, as the useful life of land is assumed to be indefinite.
Mine properties include preparatory work to utilize an ore body or part of it, such as shafts,
ramps and ventilation and are depreciated using the units-of-production method based on the
depletion of ore reserves over their estimated useful lives. Other tangible assets include items
such as land improvements, asset retirement obligations related to landfill areas and
infrastructure within the facilities, such as roads and railroads.
Recognition of amortization or depreciation on an asset is ceased when the item is classified
as held for sale.
If evidence regarding an impairment of an asset is identified, the asset’s recoverable
amount is estimated as the higher of the fair value less costs to sell or the value in use. If the
carrying amount of an asset exceeds its recoverable amount, an impairment loss is recognized.
A previously recognized impairment loss is reversed if there is a change in the recoverable
amount. However, the reversal must not result in a higher carrying amount than what it would
have been if no prior impairment loss had been recognized. Impairment losses are presented as
other operating expenses in the consolidated statement of income.
Gains or losses on disposals of property, plant and equipment or intangible assets are
determined as the difference between the net proceeds received and the carrying amount of
the asset. These gains or losses are presented in other operating income or expenses.
Goodwill
Goodwill arises from business combinations and is recognized at the acquisition date
at the amount excess of the consideration transferred over the fair value of the identifiable
assets acquired, liabilities assumed and any non-controlling interest and any previously held
equity interests in the acquiree. Goodwill is not amortized but tested for impairment. Goodwill is
measured at cost less accumulated impairment losses. Impairment losses on goodwill cannot
be subsequently reversed.
See note 4.3 for goodwill impairment testing.
Emission allowances
Emission allowances are reported as other intangible assets. They are measured at cost and
initially recognized when control is obtained. Allowances received free of charge are recognized
at nominal value, i.e. at zero carrying amount. Emission allowances are derecognized against
the actual emissions, or when the emission allowances are sold.
Emission allowance expense is recognized when emission allowances received free of charge
do not cover the annual emissions for the difference based on the cost of the purchased
allowances. In case the Group does not hold sufficient allowances to cover the actual
emissions, a provision regarding the obligation to return the emission allowances is recognized
at fair value at the end of the reporting period. The expenses are presented as other operating
expenses. Gains from the sale of emission allowances are recognized as other operating
income.
Outokumpu Annual Report 2024
196
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
4.2 Leases
Outokumpu leases land, buildings, and machinery and equipment used in the Group’s
operations. Outokumpu has also entered into service and supply contracts that contain lease
elements. Approximately 75 percent of the Group’s right-of-use assets are linked to an index or
a rate, making the related lease payments variable. The terms of new vehicle leases are
typically 3 to 5 years, and lease terms for other machinery and equipment range up to 15
years. Lease terms for land and buildings can be significantly longer with the remaining terms
for individual contracts on land of approximately 45–95 years. Leases for machinery and
equipment include also contracts with variable lease payments based on usage of the
equipment. Machinery and equipment are also hired with daily rates for temporary use, in which
case they are reported as short-term leases. Most of the right-of-use assets are in Finland,
totaling EUR 131 million.
Right-of-use assets
2024
€ million
Land
Buildings
Machinery and
equipment
Advances paid and
other tangible assets
Total
Historical cost on Jan 1, 2024
36
41
179
1
257
Additions
—
5
51
0
56
Reclassifications
1
1
0
0
1
Other changes
0
-9
-7
-1
-16
Historical cost on Dec 31, 2024
36
39
223
1
299
Accumulated depreciation and impairment on Jan 1,2024
-5
-30
-75
-1
-110
Depreciation and impairments
-1
3
-33
0
-31
Reclassifications
-1
-1
0
0
-1
Other changes
—
4
19
1
23
Accumulated depreciation and impairment on Dec 31, 2024
-6
-24
-89
0
-119
Carrying value on Dec 31, 2024
30
15
134
1
179
Carrying value on Jan 1, 2024
30
11
104
1
147
In 2024, Outokumpu took into use three cargo vessels leased from Langh Ship. Additions include EUR 39 million related to these contracts.
Outokumpu Annual Report 2024
197
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
2023
€ million
Land
Buildings
Machinery and
equipment
Advances paid and
other tangible assets
Total
Historical cost on Jan 1, 2023
36
41
175
2
254
Additions
—
2
19
1
22
Reclassifications
—
1
0
0
1
Other changes
—
-3
-15
-1
-19
Historical cost on Dec 31, 2023
36
41
179
1
257
Accumulated depreciation and impairment on Jan 1, 2023
-5
-22
-71
-1
-97
Depreciation and impairments
-1
-10
-32
0
-42
Reclassifications
—
-1
0
0
-1
Other changes
—
3
27
1
30
Accumulated depreciation and impairment on Dec 31, 2023
-5
-30
-75
-1
-110
Carrying value on Dec 31, 2023
30
11
104
1
147
Carrying value on Jan 1, 2023
31
20
104
1
156
Lease receivables
€ million
2024
2023
Non-current
6
—
Current
1
—
Total
7
—
Lease liabilities
€ million
2024
2023
Non-current
167
146
Current
38
29
Total
206
175
Maturity analysis of lease liabilities is presented in note 5.1.
Lease expenses
€ million
2024
2023
Depreciation
-38
-37
Impairments and impairment reversals
7
-5
Interest expenses
-13
-10
Expenses on short-term and low-value leases
-25
-20
Total
-68
-72
In 2024, the impairment reversal of EUR 7 million is related to a lease contract in Germany.
Lease cash flows
€ million
2024
2023
Repayments
-38
-39
Interest paid
-13
-10
Total
-50
-49
Outokumpu Annual Report 2024
198
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Management judgements
Management judgment and estimates relate mainly to incremental borrowing rates of the Group
companies, the probabilities of utilizing extension options in lease contracts and lease terms
applied for contracts that are valid until further notice, which impact the reported amounts of
lease liabilities and right-of-use assets.
The incremental borrowing rates are defined as part of the process to determine interest
rates for intra-group lending, in which Outokumpu defines synthetic ratings for the subsidiaries.
The incremental borrowing rate takes into account the currency, the maturity of the lease
liability, the credit risk of the lessee based on the synthetic rating, and country risk.
The contracts with extension options are reviewed regularly to evaluate the probability of
utilization based on information available.
Contracts that are valid until further notice represent only a small amount of Group’s lease
contracts, as most contracts have a fixed term. The lease terms for the contracts that are valid
until further notice are either defined based on the Group’s mid-term planning cycle of 3 years
or treated as short-term depending of the type of the asset.
The Group applies materiality in defining low-value items for lease accounting purposes.
Accounting principles
Group as a lessee
Lease liabilities measured at the present value of future lease payments are recognized to the
statement of financial position. In determining the present value of the lease liabilities, the
fixed and index/rate-based lease payments are discounted with the interest rate implicit to the
lease when available, or with the incremental borrowing rate of the company.
Lease payments are divided into interest expense and repayment of the lease liability. Lease
contracts may include options to extend the contract term or purchase the leased asset at the
end of the lease term. Lease term is determined as the non-cancellable period of the lease
taking into consideration the options to extend and terminate if it is reasonably certain that the
Group will exercise the extension option or will not exercise the termination option.
Leased assets are presented in the balance sheet as a separate line item. Right-of-use
assets recognized to the statement of financial position are measured at the amount of lease
liability and lease payments made in advance, less accumulated depreciation and impairments.
Right-of-use assets are depreciated on a straight-line basis over the lease term, or over the
expected useful life of the asset in case the asset will transfer to Outokumpu at the end of the
lease term or it is highly probable that a purchase option will be used.
Lease liabilities are presented as part of non-current and current debt in the consolidated
statement of financial position. Lease liabilities are part of the net debt calculation.
Lease liabilities or right-of-use assets relating to short-term leases, leases of low value items,
or intangible assets are not recognized to the statement of financial position. Instead, related
payments are recognized as expense to the profit or loss.
Sale and lease-back
So-called sale and lease-back transactions by the Group in 2019 or later (i.e. in accordance
with IFRS 16) do not typically meet the IFRS 15 criteria of a sale, as Outokumpu typically
retains the control of the asset. Consequently, they do not meet the criteria of sale and lease-
back, either. The asset remains in Outokumpu’s property, plant and equipment at cost less
accumulated depreciation and impairments. The proceeds of the transaction are recognized as
other loans under non-current or current debt.
Sale and lease-back transactions carried out prior to 2019 have been treated according to
the accounting principles prevailing at the time.
Group as a lessor
At inception of a lease contract, an assessment is made whether the lease is a finance lease or
an operating lease. If the lease transfers substantially all of the risks and rewards incidental to
ownership of the asset, it is considered to be a finance lease, otherwise the lease is considered
to be an operating lease. The Group has no material finance lease contracts.
Rental income received from property, plant and equipment leased out by the Group under
operating leases is recognized on a straight-line basis over the lease term. Rental income is
presented as other operating income. The Group has no material income from operating lease
contracts.
Outokumpu Annual Report 2024
199
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
4.3 Goodwill impairment test
Goodwill and operating capital by operating segment
Goodwill
Operating capital
€ million
2024
2023
2024
2023
Europe
343
343
1,959
1,850
Americas
—
—
574
594
Ferrochrome
114
114
863
894
Other operations and intra-group items
—
—
99
52
Total
457
457
3,495
3,390
Assumptions by operating segment
Europe
Ferrochrome
2024
Weighted average cost of capital (WACC), pre-tax, %
9.1
9.1
Weighted average cost of capital (WACC), after-tax, %
7.1
7.4
Terminal growth rate, %
0.5
0.5
2023
Weighted average cost of capital (WACC), pre-tax, %
11.6
11.7
Weighted average cost of capital (WACC), after-tax, %
9.0
9.3
Terminal growth rate, %
0.5
0.5
Test results and sensitivities by operating segment
2024
Europe
Ferrochrome
Headroom, € million
1,452
282
After-tax WACC increase leading to impairment, %-points
5.5
2.5
EBITDA decrease leading to impairment, %
39
21
Terminal growth rate of zero leading to impairment
No
No
Headroom is the amount by which the recoverable amount determined based on the value-in-use analysis
exceeds the segment’s operating capital amount as at the impairment testing date.
Goodwill impairment testing
In 2024 and 2023, as a result of the impairment testing performed to Group’s cash-generating
units, no goodwill impairment losses were recognized. Goodwill impairment testing is carried out
on operating segment level, as they correspond to the Group’s cash-generating units (CGUs)
and the goodwill allocation level.
The recoverable amounts of the cash-generating units are based on value-in-use calculations
that are prepared using discounted cash flow projections. These projections are based on the
Group’s strategy approved by the key management, and include cash flow forecasts for 2024–
2029 after which the terminal value is calculated.
The carrying amount to which the recoverable amount is compared, is the operating capital of
the segment.
Management judgements
Key assumptions of the value-in-use calculations include the discount rate, the terminal value
growth rate, the average global growth in end-use consumption of stainless steel and price
development. Assumptions also include estimates on delivery volume and capital expenditure
development, and cost savings related to on-going strategy-implementation related initiatives.
Cash flow forecasts are discounted using the pre-tax weighted-average cost of capital
(WACC) as defined for Outokumpu. The components of WACC are the risk-free rate,
Outokumpu’s credit margin, the equity market risk premium, the equity beta, and the industry's
median capital structure.
In general, management believes that the assumptions used in the value-in-use calculations
are conservative based on the current economic circumstances. Growth rates assumed for
stainless steel deliveries are generally lower than independent analysts’ view on long-term
market development.
Accounting principles
Goodwill is allocated to and tested for impairment on operating segment level, which
correspond to the Group’s cash-generating units (CGUs), and the lowest level goodwill is
monitored. Impairment test is carried out on an annual basis, or more frequently when there is
evidence of potential goodwill impairment.
In goodwill impairment testing, the recoverable amounts are based on value in use
determined by discounted future net cash flows expected to be generated by the cash-
generating unit. The discount rate used is a pre-tax rate that reflects the current market view on
the time value of money and the CGU-specific risks.
An impairment loss is the amount by which the carrying amount of the segment’s assets
exceeds its recoverable amount. Impairment losses are recognized first on goodwill and after
that on other intangible and tangible assets on a pro-rata basis. In the consolidated statement
of income impairments are presented in other operating expenses. Impairment losses related to
goodwill cannot be subsequently reversed.
Outokumpu Annual Report 2024
200
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
4.4 Inventories
€ million
2024
2023
Raw materials and consumables
684
690
Work in progress
723
553
Finished goods and merchandise
333
321
Advanced payments
25
16
Total
1,764
1,581
Reversal of write-downs related to net realizable value of EUR 11 million were recognized in the
profit or loss during 2024 (2023: write-downs of EUR 19 million).
In 2024, Outokumpu applies cash flow hedge accounting for three selected nickel hedging
programs out of which one impacts also inventory values. More details on commodity price risk
and hedge accounting are presented in notes 5.3 and 5.4.
Management judgements
Management judgment and estimates are applied in net realizable value (NRV) and inventory
obsolescence analysis.
NRV calculation requires estimates on sales prices for products to be sold in the future to
the extent the prices are not known, which can be a significant part of the future prices. Due to
fluctuations in nickel and other alloy prices, which are the most important commodity price
risks for Outokumpu, the realized prices can deviate significantly from the estimates used in
NRV calculations.
The alloy surcharge clause as well as daily fixed pricing of stainless steel reduce the risk
arising from the time difference between raw material purchase and product delivery. However,
the risk is still significant because the delivery cycle in production is longer than the alloy
surcharge mechanism expects and the daily fixed pricing can also deviate from this cycle
depending on the timing of the delivery.
Inventory obsolescence for stainless steel products is estimated based on internal guidelines
on slow-moving inventory.
Accounting principles
Inventories are stated at the lower of cost and net realizable value. These are defined with
different methodologies depending on the type of inventory.
The cost of raw materials is determined as the monthly weighted average of the actual raw
material cost. The cost of self-produced finished goods and work in progress comprises of raw
materials, direct labor, other direct costs and related production and procurement overheads.
Cost of purchased products includes all purchasing costs including direct transportation,
handling and other costs.
NRV is calculated as the estimated selling price in the ordinary course of business, less the
estimated costs of completion and the estimated costs attributable to the sale.
Obsolete stainless steel products are valued at scrap value. Spare parts are carried as
inventory and their cost is recognized in profit or loss as consumed.
Major spare parts are recognized in property, plant and equipment when they are expected
to be used over more than one year.
Outokumpu Annual Report 2024
201
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
4.5 Trade and other receivables and payables
Trade and other receivables
€ million
2024
2023
Non-current
Non-current receivables and accruals
10
12
Current
Trade receivables
389
508
VAT receivables
53
51
Escrow deposits
14
18
Prepaid insurance expenses
3
7
Other accruals
21
21
Other receivables
12
4
Total
492
609
Loss allowance on trade receivables
On Jan 1
5
5
Additions in loss allowance
2
—
Reclassifications
—
0
Reduction in loss allowance
0
0
On Dec 31
6
5
Age analysis of trade receivables
Not overdue
349
474
Past due 1–30 days
25
28
Past due 31–60 days
6
2
More than 60 days
9
4
Total
389
508
Factored trade receivables
Outokumpu uses factoring to finance its working capital. Under these arrangements,
Outokumpu has on December 31, 2024 derecognized trade receivables totaling EUR 426
million (Dec 31, 2023: EUR 376 million), which represents fair value of the assets. Net
proceeds received amounted to EUR 426 million (2023: EUR 376 million). The underlying
assets have maturity of less than one year.
The maximum amount of loss related to derecognized assets is estimated to be EUR 17 million
(2023: EUR 14 million). This estimate is based on insurance policies and contractual
arrangements between factoring companies and Outokumpu. The analysis does not include
impact of any operational risk related to Outokumpu’s contractual responsibilities.
Trade and other payables
€ million
2024
2023
Non-current
Accruals
13
16
Current
Trade payables
1,129
1,067
Accrued employee-related expenses
74
72
Accrued interest expenses
7
7
VAT payable
50
23
Withholding tax and social security liabilities
20
18
Advance payments received
32
31
Accruals relating to customer rebates
32
42
Factoring arrangements related payables
4
6
Tax on mined minerals
7
—
Other accruals
31
30
Other payables
4
2
Total
1,390
1,299
Liabilities related to customer contracts and advance payments received
On December 31, 2024, accrued volume discounts related to customer contracts amounted to
EUR 32 million (Dec 31, 2023: EUR 42 million).
The liabilities related to the unperformed transportation services were not material on
December 31, 2024, and these liabilities are expected to be recognized as revenue over the
following three months.
Advance payments received are mainly related to subsidies received and will be recognized as
property, plant and equipment when related assets are capitalized. Part of the value is also
including advance payments received related to customer contracts which are expected to be
recognized as revenue over the following three months.
Outokumpu Annual Report 2024
202
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Risk information
Credit risk
Outokumpu’s sales are covered by approved credit limits or secured payment terms. Most of
the outstanding trade receivables have been secured by trade credit insurances, which typically
cover some 95% of the insured amount. Part of the credit risk related to trade receivables is
managed with letters of credit, advance payments and guarantees.
On December 31, 2024, the maximum exposure to credit risk of trade receivables was EUR
389 million (2023: EUR 508 million). The portion of unsecured receivables during 2024 has
been approximately 6–12% of all trade receivables. During 2024, credit limits have remained
available from the insurer and there is no significant change in the insurance cover. Outokumpu
has frequently monitored customer credit risk and the overdue situation and continued its close
co-operation with the insurers.
Outokumpu uses factoring, which transfers most risks and rewards to the buyer of the
receivables. At the end of the year 2024, most of the receivables were generated by a large
number of customers and there were only few risk concentrations.
Country risk
Exposure to country risk is monitored and mitigated by having a credit insurance that provides
cover against political risks on external account receivables. However, there is some exposure
on certain countries where insurance was unavailable.
Accounting principles
Trade and other receivables and payables include financial assets or liabilities measured at
amortized cost. After initial recognition, they are measured at amortized cost by using the
effective interest rate method. Trade and other receivables are valued net of accumulated
impairments.
Factored trade receivables
Factored trade receivables have been derecognized from the statement of financial position
when the related risks and rewards of ownership have materially been transferred to the
counterparty of the factoring transaction.
Expected credit losses
Outokumpu applies a simplified model in assessing and recognizing loss allowance for expected
credit losses on trade receivables. The calculation model is based on overdue statistics and
counterparty-specific credit ratings linked with loss probabilities for each rating. Loss
allowances are recognized in selling and marketing expenses in the consolidated statement of
income.
Liabilities related to customer contracts
Liabilities related to customer contracts include accrued volume rebates, advance payments
received and liabilities related to transportation service not yet performed. Accrued volume
discounts have been recognized as reductions in revenue during the financial year.
4.6 Provisions
2024
€ million
Environmental
provisions
Restructuring
provisions
Other
provisions
Total
Provisions on Jan 1, 2024
48
24
38
110
Translation differences
0
0
1
1
Increase in provisions
2
8
3
13
Utilized during the financial year
0
-27
-1
-28
Unused amounts reversed
-2
-6
-6
-14
Reclassifications
—
2
0
2
Provisions on Dec 31, 2024
48
1
35
84
2023
€ million
Environmental
provisions
Restructuring
provisions
Other
provisions
Total
Provisions on Jan 1, 2023
45
8
28
81
Translation differences
0
0
-1
-1
Increase in provisions
4
30
11
46
Utilized during the financial year
0
0
-1
-2
Unused amounts reserved
-1
-1
-1
-2
Reclassifications
—
-13
1
-12
Provisions on Dec 31, 2023
48
24
38
110
€ million
2024
2023
Non-current provisions
52
73
Current provisions
33
37
Total
84
110
Environmental provisions
The majority of the environmental provisions are for closing costs of production facilities and
landfill areas, removal of problem waste and landscaping in facilities in Finland and Germany,
and aftercare of closed mines in Finland. The outflow of economic benefits related to
environmental provisions is expected to take place mainly over a period of more than 10 years.
Due to the nature of these provisions, there are uncertainties regarding both the amount and
the timing of the outflow of economic benefits.
Restructuring provisions
In 2024, the utilization mainly relates to the restructuring measures in Germany that were
planned at the end of 2023. Outokumpu is transferring it’s precision strip operations from
Dahlerbrück to Dillenburg and closed its coil service center in Hockenheim. These restructuring
measures impacted close to 200 people in Germany.
Outokumpu Annual Report 2024
203
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
In 2023, the increases in restructuring provisions were mainly due to restructuring measures in
Germany. Reclassifications were mainly related to transfers from provisions to employee benefit
obligations in Germany.
Other provisions
Other provisions comprise for example provisions for litigations, product and other claims and
are mainly current in nature.
Management judgements
Provisions are based on management’s best estimates at the end of the reporting period.
Regarding environmental provisions, the management judgments and estimates relate
mainly to the timing and the scope of the activities to be carried out as well as the costs of
such activities in the future. Environmental expenditure related to dismantling an entire
production facility and restoring the area are generally estimated when decision on a site
closure is made.
As actual outflows can differ from estimates due to changes in law, regulations, public
expectations, technology, prices and conditions, and can take place in many years in the future,
the provisions are regularly reviewed to take such changes into account.
Regarding restructuring provisions, the judgements and estimates mainly relate to the
amounts of termination benefits to employees.
Accounting principles
A provision is recognized when Outokumpu has a present legal or constructive obligation as a
result of a past event, and it is probable that an outflow of economic benefits will be required to
settle the obligation and the amount can be reliably estimated. Provisions relate mainly to
environmental liabilities, restructuring plans, onerous contracts and litigations. Non-current
provisions are discounted to present value at the end of the reporting period using risk-free
discount rates.
Outokumpu aims at minimizing negative impacts of its present and discontinued operations
on the environment, and aims to remediate any material negative impacts that have occurred
where viable. Environmental expenditure arising from restoring the conditions caused by past
operations are recognized as expenses when they are incurred. Environmental provision is
recognized when the Group has a legal or constructive obligation to decommission or remove a
facility or equipment, rehabilitate environmental damage, or landscape and restore an area. The
recognition of environmental provisions is based on current interpretation of the effective
environmental laws and regulations together with Outokumpu’s Code of Conduct.
When environmental expenditure will arise from future asset retirement obligations, an item
of property, plant and equipment corresponding to the amount of the provision is recognized,
and it will be depreciated over the asset’s useful life. Subsequent adjustments to the provision
are deducted from or added to the cost of the corresponding asset in a symmetrical manner.
A restructuring provision is recognized when a detailed restructuring plan has been prepared
and its implementation has been started or the main parts of the plan have been
communicated to those, who are impacted by the plan. Restructuring provision mainly comprise
of employee termination benefits.
Any potential compensation from a third party is not included in the amount of the provision
but recognized as a separate asset when it is virtually certain that the compensation will be
received.
Outokumpu Annual Report 2024
204
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
5. Capital structure and financial risk management
Outokumpu maintained a strong financial position in 2024. Despite weaker profitability and dividend payment,
net debt increased only moderately. In 2024, credit rating agency Moody’s confirmed Outokumpu’s corporate
family rating at Ba2 with a stable outlook.
The capital structure is regularly monitored by management with focus on the company’s
leverage ratio (net debt to adjusted EBITDA) and liquidity. The target is to have a leverage ratio
less than 1.0 in normal market conditions.
The main objective of capital management is to secure the ability to operate on a going concern
basis to enhance value to shareholders and to optimize the cost of capital. Outokumpu seeks
to maintain access to loan and capital markets at all times and to preserve sufficient liquidity.
The Board of Directors reviews the Group’s capital structure on a regular basis. Capital
structure and debt capacity are taken into account e.g. in investment, dividend and debt
decisions.
Equity is managed through the dividend policy, share buybacks and issuances of equity or
equity-linked securities. In February 2024, Outokumpu completed its share buyback program for
a maximum amount of EUR 50 million.
Tools to manage debt in order to optimize the maturity structure of the debt portfolio and to
minimize finance costs include raising new debt in various forms, establishing financing
facilities, prepaying and cancelling loans, notes and other financing facilities.
Capital structure
€ million
2024
2023
Total equity
3,748
3,762
Gross debt
502
441
Total capitalization
4,250
4,204
Net debt
189
-60
Net debt, € million*
2020
2021
2022
2023
2024
-200
0
200
400
600
800
1,000
1,200
Net debt to adjusted EBITDA*
2020
2021
2022
2023
2024
-1.0
0.0
1.0
2.0
3.0
4.0
5.0
Debt-to-equity, %*
2020
2021
2022
2023
2024
-10.0
0.0
10.0
20.0
30.0
40.0
50.0
*Including discontinued operations until 2022. In 2023 and 2024 no
discontinued operations impact in the balance sheet.
Outokumpu Annual Report 2024
205
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
5.1 Net debt and capital management
The main focus in 2024 on debt management was to ensure sufficient liquidity and at the same
time monitor financing costs. Net debt increased to EUR 189 million at the year-end 2024. No
new loan arrangements were completed during 2024, however, the leasing liabilities of three
new liner vessels during 2024 had an increasing impact on net debt.
In order to mitigate and manage the dilutive impact of the conversion of its EUR 125 million
convertible bonds due in 2025, Outokumpu completed a share buyback program of EUR 50
million in February 2024. See more information on share buyback program in note 5.2.
Net debt
€ million
2024
2023
Non-current
Convertible bonds
—
119
Loans from financial institutions
71
85
Lease liabilities
167
146
Other loans
8
9
246
359
Current
Convertible bonds
123
—
Loans from financial institutions
14
14
Lease liabilities
38
29
Commercial papers
79
—
Other loans 1)
1
40
256
82
Cash and cash equivalents
Cash at bank and in hand
308
497
Short-term bank deposits and cash equivalents
5
5
313
502
Net debt
189
-60
1) Year 2023 other loans include share buyback program related financial liability: EUR 38 million.
Net debt development
€ million
2024
2023
Net cash flow from operating activities
147
325
Net cash flow from investing activities
-218
-35
Cash flow before financing activities
-71
290
Dividends paid
-110
-152
Treasury share purchase
-34
-70
Cash flow impact on net debt
-216
68
Net debt on Jan 1
-60
-10
Cash flow impact on net debt
216
-68
Share buyback financial liability
-38
38
Change in net debt, non-cash
72
-20
Net debt on Dec 31
189
-60
Average effective interest rate of cash and cash equivalents at the end of 2024 was 3.0% (Dec 31, 2023:
3.8%).
Outokumpu Annual Report 2024
206
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Changes in non-current and current debt
2024
€ million
Non-current debt
Current portion of non-
current debt
Non-current lease
liabilities
Current portion of
lease liabilities
Current debt
Total
On Jan 1
213
15
146
29
38
441
Financing cash flows
—
-15
—
-38
45
-8
Transfer to current debt
-136
136
-47
47
—
—
Other non-cash movements
2
2
68
—
-4
68
On Dec 31
79
138
167
38
79
502
2023
€ million
Non-current debt
Current portion of non-
current debt
Non-current lease
liabilities
Current portion of
lease liabilities
Current debt 1)
Total
On Jan 1
348
46
143
37
58
632
Financing cash flows
-123
-46
—
-39
-58
-266
Transfer to current debt
-15
15
-31
31
—
—
Other non-cash movements
4
—
34
—
38
76
On Dec 31
213
15
146
29
38
441
1) Including share buyback program related financial liability EUR 38 million.
Other non-cash movements in debt consist mainly of the share buyback program related impact in equity as the original commitment was higher than the realized one and effective interest including accrued arrangement
fees. Other non-cash movements in lease liabilities consist of new lease agreements and changes in terms of existing agreements.
Convertible bonds
Outstanding amount
€ million
Interest rate, %
2024
2023
2020 fixed rate bonds maturing on July 9,
2025
5.0
125
125
The convertible bonds maturing in July 2025 can be converted into a maximum of 45,261,669
ordinary shares in Outokumpu, representing 10.7% of the outstanding shares at year end. The
conversion period commenced on August 19, 2020 and will end on June 25, 2025. The current
conversion price is set at EUR 2.7573 per ordinary share. The conversion price is subject to
adjustments for any dividend in cash or in kind as well as customary anti-dilution adjustments,
pursuant to the terms and conditions of the bonds. On December 31, 2024, the remaining part
of the equity component of the convertible bonds amounted to EUR 2 million (Dec 31, 2023:
EUR 6 million). Outokumpu has taken appropriate measures to manage a possible conversion
and/or cash repayment of the convertible bonds.
Outokumpu Annual Report 2024
207
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Contractual cash flows
2024
2023
€ million
2025
2026
2027
2028
2029
2030—
2024
2025
2026
2027
2028
2029
—
Convertible bonds
125
—
—
—
—
—
—
125
—
—
—
—
Loans from financial institutions
14
14
14
14
14
14
14
14
14
14
14
28
Other loans 1)
1
1
1
0
0
5
40
1
1
1
0
5
Commercial papers
79
—
—
—
—
—
—
—
—
—
—
—
Interest payments on debt and facility charges
17
9
4
2
1
2
17
13
9
4
2
3
Lease liabilities 2)
38
31
30
29
22
56
29
25
18
17
16
70
Interest payments on lease liabilities2)
12
10
8
6
4
124
10
9
7
6
5
127
Trade and other payables3)
1,144
—
—
—
—
—
1,086
—
—
—
—
—
1,430
64
57
51
42
200
1,196
187
49
43
38
234
Contractual cash flows related to derivative instruments are presented in note 5.4.
1) Year 2023 including share buyback program related financial liability EUR 38 million at Dec 31, 2024.
2) Contractual cash flows are impacted by the index or rate changes related to lease contracts.
3) The comparison period data has been revised.
Credit facilities
2024
2023
€ million
Maturity
Total
Utilized
Available
Total
Utilized
Available
Committed revolving credit facility
Feb 2027
700
—
700
700
—
700
Committed Finnvera facility
Dec 2025
100
—
100
100
—
100
Committed facilities total
800
—
800
800
—
800
Uncommitted Finnish Commercial paper program
N/A
800
79
721
800
—
800
Overall liquidity reserves at Dec 31, 2024 were EUR 1.1 billion (Dec 31, 2023: EUR 1.3 billion). The liquidity reserves include cash and cash equivalents and EUR 800 million of outstanding
committed credit facilities, which were fully unutilized.
Outokumpu Annual Report 2024
208
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Risk information
Liquidity and refinancing risk
Outokumpu raises most of its funding centrally and in co-ordination by the Treasury function
(“Treasury”). The Group seeks to reduce its liquidity and refinancing risk by having sufficient
amount of cash and committed long-term credit lines available and by maintaining a balanced
debt maturity profile with diversified sources of funding. Efficient daily cash and liquidity
management and the use of instruments such as commercial papers and currency swaps, also
reduce the liquidity risk.
Finance and liquidity plans are prepared and reviewed regularly with a focus on forecasted
cash flows, projected funding requirements, planned funding transactions and financial
covenant headroom. The adequacy of liquidity reserves, the amounts of scheduled annual
repayments of non-current debt compared to EBITDA as well as forecasted gearing and leverage
ratios are key measures being considered.
Outokumpu is exposed to changes in credit margins as the development of the leverage ratio
has an impact on the interest rate margin definition in some of the Group’s loan agreements
and as such on its interest and other financial expenses. In addition, some of the Group´s loan
agreements include a financial covenant, but a breach is unlikely as there is ample headroom
in the financial covenant.
Accounting principles
Bonds, loans from financial institutions, pension and other loans are recognized at the
settlement date and measured initially at fair value net of direct transaction costs.
Subsequently they are carried at amortized cost using the effective interest rate method.
Transaction costs are amortized over the maturity of the borrowing using the effective
interest rate method. A financial liability (or part of the liability) is derecognized when the
liability ceases to exist, that is, when the obligation identified in a contract has been fulfilled or
cancelled or is no longer effective.
The fair value of non-current and current debt is determined based on quoted prices for
listed instruments. For loans the fair value is determined using the discounted cash flow
method based on yields at the reporting date. The fair values of non-current and current debt
are presented in note 5.5.
Fees related to revolving credit facilities are amortized over the expected facility term.
Convertible bonds
Convertible bonds are compound instruments with components of the bonds classified
separately as financial liabilities and equity in accordance with the substance of the
arrangement.
The liability component is recognized initially at fair value of a similar liability. The equity
component is recognized initially at the difference between the fair values of the full bond and
the liability component. Transaction costs are allocated to the components in proportion to
their initial carrying amounts. The fair value includes the value of conversion rights.
Subsequently the liability component is measured at amortized cost with the effective
interest method. At conversion or on expiry the equity component is reclassified within equity.
Lease liabilities
Accounting principles related to lease liabilities are presented in note 4.2.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand, deposits held at call with banks and other
highly liquid investments with original maturities of three months or less. These are readily
convertible to a known amount of cash with a low risk of any changes in the value.
Bank overdrafts are reported as current debt.
Outokumpu Annual Report 2024
209
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
5.2 Equity
Shares and related movements in equity
€ million
Number of shares, 1,000
Share capital
Premium fund
Invested unrestricted
equity reserve
Treasury shares
Total
On Jan 1, 2023
444,135
311
714
2,308
-129
3,204
Shares delivered from the share-based payment programs
892
—
—
—
9
9
Repurchase of treasury shares
-13,904
—
—
—
-50
-50
Surrendered shares related to convertible bonds
68
—
—
0
1
0
Shares outstanding on Dec 31, 2023
431,191
311
714
2,307
-169
3,163
Shares delivered from the share-based payment programs
852
—
—
—
6
6
Repurchase of treasury shares
-8,358
—
—
—
4
4
Shares outstanding on Dec 31, 2024
423,686
311
714
2,307
-159
3,173
Treasury shares
33,189
Total number of shares on Dec 31, 2024
456,874
Share buyback program
Through share buyback programs, Outokumpu seeks to mitigate and manage the dilutive impact
of the company’s outstanding convertible bonds. The repurchased shares will be initially held by
Outokumpu as treasury shares and may be used to meet its obligations under the convertible
bonds. Alternatively, Outokumpu may decide to cancel any or all of the repurchased shares and
reduce its capital accordingly.
2024
On February 29, 2024, Outokumpu completed its up to EUR 50 million share buyback program
which was announced on November 29, 2023 and commenced on December 1, 2023. During
the 2023 program, Outokumpu repurchased a total of 11,000,000 of its own shares and used
a total of EUR 46 million for the share repurchases. The average price per share was
approximately EUR 4.15.
During the year 2024, Outokumpu purchased a total of 8,357,545 of its own shares. As the
original commitment recognized in year 2023 was higher, a EUR 4 million impact was
recognized in equity during the year 2024 in relation to this program. After the completion of
the share buyback program and onward on December 31, 2024, Outokumpu held a total of
33,188,820 treasury shares, representing 7.3 % of the company’s total number of shares.
2023
During the year 2023, Outokumpu purchased a total of 13,903,534 of its own shares of which
2,642,455 shares were under the 2023 launched share buyback program and 11,261,079
were under the 2022 launched program.
On December 31, 2023, Outokumpu held 25,683,745 treasury shares, which represented 5.6%
of the company’s total number of shares.
On November 29, 2023, Outokumpu launched a share buyback program of up to EUR 50 million
under the authorization of the Annual General Meeting. The maximum number of shares to be
repurchased under the program was 11 million, representing approximately 2.4% of the
company’s total number of shares. The program commenced on December 1, 2023 and ended
on February 29, 2024. By the end of December 2023, Outokumpu had purchased 2,642,455
shares and used a total of EUR 12 million.
Outokumpu had appointed a third-party broker to execute the share buyback program that,
based on irrevocable instructions, decided on the repurchase of shares in full independence,
also in relation to the timing of the transactions, and in compliance with applicable price and
volume limits as well as applicable terms. The share buyback program was expected to be
carried out in full and have a maximum EUR 50 million impact on net debt during the duration
of the program. However, the company had the option to terminate the program during the
buyback period. Because of the nature of the contract with the third party, Outokumpu
recognized a EUR 38 million financial liability related to the share buyback program and the
maximum amount of EUR 50 million impacted the equity and net debt already in 2023.
Outokumpu Annual Report 2024
210
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Dividend policy and distributable funds
According to its dividend policy, Outokumpu aims to distribute a stable and growing dividend, to
be paid annually. On December 31, 2024, the distributable funds of the parent company
totaled EUR 2,555 million of which retained earnings were EUR 369 million.
The Board of Directors proposes to the Annual General Meeting to be held on April 3, 2025,
that a dividend of EUR 0.26 per share will be paid for the year 2024, corresponding to EUR 110
million based on the number of shares outstanding on December 31, 2024. The dividend will
be paid in two installments.
In 2024, Outokumpu paid for the financial year 2023 a dividend of EUR 0.26 per share, a total
of EUR 110 million.
Accounting principles
Shares and share capital
According to the Articles of Association, Outokumpu has one single class of shares and all
shares have equal voting rights at General meetings. The shares do not have a nominal value.
Premium fund
Premium fund includes proceeds from share subscriptions and other contributions based on the
old Finnish Limited Liability Companies Act for the part the contributions exceeded the account
equivalent value allocated to share capital.
Other restricted reserves
Other restricted reserves include amounts transferred from the distributable equity under the
Articles of Association or by a decision of the General Meeting of Shareholders, and other items
based on the local regulations of the Group companies.
Invested unrestricted equity reserve
Invested unrestricted equity reserve includes the net proceeds from the rights issues in
2012 and 2014 and the directed share issue in 2021.
Fair value reserves
Fair value reserves include movements in the fair values of equity securities and hedge
accounted derivative instruments.
Retained earnings
Retained earnings include remeasurements of defined benefit plans, cumulative translation
differences and other retained earnings and losses.
Treasury shares
When the parent company or its subsidiaries purchase the parent company’s own shares, the
consideration paid, including any attributable transaction costs, net of taxes, is deducted from
the parent company’s equity as treasury shares until the shares are cancelled. When such
shares are subsequently sold or reissued, any consideration received is recognized directly in
equity.
Dividends
The dividend proposed by the Board of Directors is not deducted from distributable equity until
approved by the Annual General Meeting of Shareholders. For the time period between the
approval and the payment, the dividend to be paid is presented in current trade and other
payables.
Outokumpu Annual Report 2024
211
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
5.3 Financial risk management and insurances
The main objectives of financial risk management are to reduce the volatility of the net result
and to secure sufficient liquidity to avoid financial distress. Other objectives include the
reduction of cash flow volatility and the maintenance of the debt-to-equity and leverage ratios
within set targets. The main objectives of insurance management are to provide mitigation
against catastrophe risks and to reduce variation of the net result.
The Board of Directors has approved the risk management policy, which defines responsibilities,
the process and other main principles of risk management. The Board of Directors oversees risk
management on a regular basis and the Chief Financial Officer (CFO) is responsible for the
implementation and development of financial risk management. The CFO leads relevant
steering groups, such as the Risk Management Steering Group for enterprise risk management
and the Financial Risk Steering Group for financial risk management. The Energy Steering Group
for energy risk management is led by SVP General Procurement.
Financial risks consist of market, country, credit, liquidity and refinancing risks. Outokumpu
subsidiaries hedge their currency and commodity price risk with the parent company
Outokumpu Corporation, which does most of the Group’s foreign exchange and commodity
derivative contracts with banks and other financial institutions. The Treasury function
(“Treasury”) is responsible for managing foreign exchange, metal, interest rate, liquidity and
refinancing as well as emission allowance price risk. Credit controlling has been mainly
centralized to Finance Services, and Treasury oversees credit risk management globally.
Customer credit risk is presented in note 4.5. The procurement function is responsible for
managing the electricity and fuel price risks.
Treasury sources all global insurances. The main insurance lines are related to property,
business interruption, liabilities and credit risk. The captive insurance company Visenta
Försäkringsaktiebolag contributes to the global insurance business by participating primarily in
the property damage and business interruption (PDBI) insurance line.
Exposure to financial risks is identified in connection with the Group’s risk management
process. This approach aims to ensure that any emerging risks are identified early and that
significant risks are described, quantified, managed and communicated appropriately.
Sensitivity of financial instruments to market risk
Dec 31, 2024
Dec 31, 2023
€ million
In profit or loss
In other comprehensive income
In profit or loss
In other comprehensive income
+/-10% change in EUR/USD exchange rate
+7/-9
—
+2/-3
—
+/-10% change in EUR/SEK exchange rate
-3/+4
—
-5/+6
—
+/-10% change in nickel price in USD
-1/+1
-4/+4
-2/+2
-6/+6
+/-1% parallel shift in interest rates
-1/+1
—
-1/+1
—
The sensitivity analyses apply to financial assets and liabilities only. Other assets and liabilities, including defined benefit pension plan assets and liabilities, as well as off balance sheet items such as sales and purchase
orders, are not in the scope of these analyses. The calculations are net of tax. During the year the volatility for nickel price has been in the range of 20-29%. With +/–30% change in dollar denominated price, the effect in
profit or loss is about EUR -2/+2 million and in other comprehensive income EUR -11/+11 million for nickel derivatives.
Outokumpu Annual Report 2024
212
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Risk information
Market risk
Outokumpu’s main market risks are foreign exchange risk, interest rate risk, security price risk
as well as commodity price risk, namely in metals, fuels, energy and emission allowances. The
price changes in the before mentioned risks may have a significant impact on the Group’s net
result, cash flow and capital structure. Due to the cyclicality of the stainless steel business,
Outokumpu’s exposure to market risks may change significantly from one period to another.
Consequently, derivative positions to mitigate market risks change due to the cyclical business
environment.
Note 5.4 details the fair values and nominal amounts of derivative instruments while the
sensitivity of financial instruments to market risks is described in the table of the previous
page.
The strategy for market risk management is based on identifying, evaluating and mitigating
relevant risks in committed business transactions, balance sheet items and selected forecasted
items for each of the market risk categories. The use of derivatives to mitigate market risks
may cause timing differences between derivative gains or losses and in the impact of the
underlying exposure on the net result. In order to reduce such timing differences in net result,
hedge accounting can be applied selectively as part of the commodity and foreign exchange
hedging activities. Most of the derivatives are short-term, however, interest rate hedges typically
have a maturity in excess of one year.
Foreign exchange rate risk
Outokumpu is exposed to foreign exchange rate risk as its business and operations are global.
The risk arises from changes in exchange rates and may have effects on net result, cash flow
and balance sheet. The foreign exchange exposure consists of risks associated with foreign
currency cash flows (transaction risk), translation risk and economic risk, such as the change in
competitiveness resulting from changes in foreign exchange rates.
The transaction risk arises from committed and forecasted transactions and payments in
currencies other than the functional currency of the entity and from changes in fair value of
foreign currency denominated items recognized on the balance sheet.
The fair value risk consists of foreign currency denominated accounts receivables, accounts
payables, debt, cash, loan receivables and the currency position from commodity derivatives.
The foreign exchange and fair value risks are, with a few exceptions, hedged in principle in full
in major currencies. Forecasted and probable cash flows are not typically hedged, but can be
hedged selectively.
In 2024, there was no hedge accounting applied in foreign exchange hedging activities.
Foreign exchange positions of EUR based companies
Dec 31, 2024
Dec 31, 2023
€ million
SEK
USD
GBP
Other
SEK
USD
GBP
Other
Trade receivables and payables
-8
-257
9
11
-25
-157
6
9
Loans and bank accounts 1)
156
-829
-59
7
90
-772
-43
4
Derivatives
-145
996
38
-30
-64
908
32
-22
Net position
3
-90
-13
-12
0
-21
-5
-8
Foreign exchange positions of SEK based companies
Dec 31, 2024
Dec 31, 2023
€ million
EUR
USD
GBP
Other
EUR
USD
GBP
Other
Trade receivables and payables
11
15
5
2
-6
7
2
3
Loans and bank accounts 1)
10
2
1
1
14
2
1
1
Derivatives
-58
-25
-19
-7
-81
-20
-19
-7
Net position
-36
-8
-13
-4
-72
-11
-17
-4
1) Includes cash and cash equivalents, loan receivables and debt.
Currency distribution and re-pricing of outstanding net debt
€ million
Dec 31, 2024
Currency
Net debt1) Derivatives2)
Rate sensitivity3) Gross debt Average rate, %4)
Duration, year5)
EUR
399
760
9.8
-502
6.2
2.0
SEK
-32
151
1.2
—
—
—
USD
-115
-865
-9.8
—
—
—
Others
-63
-58
-1.2
—
—
—
189
-12
0.0
€ million
Dec 31, 2023
Currency
Net debt1) Derivatives2)
Rate sensitivity3) Gross debt Average rate, %4)
Duration, year5)
EUR
117
771
7.4
-441
6.3
2.8
SEK
-61
84
0.2
—
—
—
USD
-75
-791
-8.7
—
—
—
Others
-41
-47
-0.9
—
—
—
-60
17
-1.9
1) Includes cash and cash equivalents, debt and financial liability related to share buyback program Dec 31,
2023.
2) Net derivative liabilities include nominal value of interest rate and currency forwards earmarked to debt.
3) The effect of one percentage point increase in interest rates to financial expenses over the following year
from net debt and derivatives.
4) Includes gross debt and financial liability related to share buyback program at Dec 31, 2023. The interest
rate of share buyback program financial liability is zero at Dec 31, 2023. Currency forwards are not included
in average rate calculation.
5) Duration calculation includes both debt and interest rate derivatives.
Outokumpu Annual Report 2024
213
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Outokumpu’s largest foreign exchange transaction risk exposures are in US dollars and
Swedish krona. A major part of the Group’s sales is in Euros and US dollars and thus the local
currency denominated production costs in Sweden cause foreign exchange risk. The main US
dollar cash flow risks origin from sales in the ferrochrome operations as chromium is priced in
US dollars and US dollar priced raw material purchases in the European stainless steel
business. Internal financing denominated in Swedish krona and US dollar cause significant fair
value foreign exchange rate risk, which is hedged with forward contracts and, if possible, with
matching of external debt or investment. The Group’s fair value foreign exchange position is
presented in more detail level in the table on the previous page.
Translation risk consists of current net investment in foreign entities and future foreign
currency denominated profits and losses, which eventually will have an impact on Group’s net
result and balance sheet through consolidation. Outokumpu’s net result and net investment
translation risk is mainly in US dollars and Swedish krona. The equity translation risk is not
typically hedged, although, according to the Treasury policy, this risk can be hedged selectively.
In 2024, there were no hedges of net result or net investment exposures. However, the
effective portion of gains (EUR 17 million, net of tax) on earlier financial years’ net investment
hedges is recognized in equity.
Economic risk relates to foreign exchange rates, commodity and energy prices, or any other
market price risks, which impact the long-term competitive position. Hedging of economic risk in
the Group is seen as a strategic decision approved by the CFO. In 2024, there were no hedges
related to economic risks.
Interest rate risk
Changes in interest rates expose Outokumpu to interest rate risk with effects on Group’s net
interest expense (i.e. cash flow risk) and value of assets and liabilities (i.e. fair value risk). The
objective of the Group’s interest rate risk management is to have a significant share of net debt
effectively with a short-term interest rate as a reference rate. This approach may help to reduce
the average interest rate of debt. Approximately 65% (2023: 38%) of the Group’s debt has an
interest period of less than one year and the average interest rate of non-current debt on
December 31, 2024 was 5.8% (Dec 31, 2023: 7.0%).
The interest rate risk exposure is composed of the Group’s net debt including all interest-
bearing assets and liabilities as well as derivatives that hedge these items. Interest rate
derivatives, such as interest rate swaps, are used to adjust the share of net debt effectively
repricing in different maturities according to limits defined in the Treasury policy.
Euro, Swedish krona and US dollar have a substantial contribution to the Group’s interest
rate risk exposure. The interest rate risk exposure in Swedish krona and US dollar primarily
originates from cash balances and foreign exchange derivatives. The interest rate position for
the Group is presented in more detail in the table on the previous page.
Metal price risk
The Metal price risk arises from changes in metal market prices and may have effects on net
result, cash flow and balance sheet.
The Group’s most significant exposures in metals price risk arise from chromium and nickel,
while other alloy metals with metal price risk include for example iron and molybdenum.
Outokumpu is exposed to metal price risk for example through purchase of raw materials as
well as sale of stainless steel products where the price of alloy metals is based on market
prices. The timing difference in such commercial purchases and sale transactions as well as its
inventory position expose the Group to metal price risk alongside the Group’s capability to pass
on price changes in raw materials to end-product prices.
Outokumpu’s underlying metal net position (in the following alloy metals: nickel, iron and
molybdenum) consists of fixed price purchase orders, inventories of alloy metal containing
materials and fixed price sales orders. The metal net positions (in tons of metal) are
continuously calculated in order to manage the underlying positions.
Metal market prices are based on prices determined in regulated markets, such as the
London Metal Exchange (LME). Also, derivatives contracts to mitigate metal price risk are based
on, for example, LME prices. Chromium does not have an established financial derivatives
market and, consequently, is not included in the scope of the Treasury policy. Financial
derivatives mainly in nickel are used to manage the impacts of metal price changes on the
Group’s net result, whereas efficient working capital management helps to reduce cash flow
variations caused by metal prices. Outokumpu has continued to apply cash flow hedge
accounting programs on nickel hedging in order to reduce the timing differences between
derivative gains or losses and the net result impact of the underlying exposure. The hedge
accounting covers a material part of the Group’s nickel derivatives hedges. The Group’s
financial derivatives fair values and nominal amounts are presented in more detail in the table
5.4 Derivative instruments.
In addition to hedging with financial derivatives, the metal price risk is also mitigated
through other measures such as pricing decisions. A part of the Group’s stainless steel sales
contracts include an alloy surcharge clause, with the aim of reducing the risk arising from the
timing difference between alloy metal purchase and stainless steel pricing and delivery. In
2024, the share of Group sales contracts including an alloy surcharge clause is on the same
level as compared to the previous year.
Energy and emission allowance price risk
Outokumpu manages energy price risk centrally and mitigates the risks by guidance from the
Energy Procurement policy. Energy price risk is hedged with long-term agreements, fixed price
supply contracts, partial ownerships in power utilities and derivatives. See more information in
note 5.4 Derivatives. The Energy Risk Steering Group monitors and decides upon proposed
hedging levels for each European business entity.
Overall, Outokumpu’s energy spend decreased around 20%–25% compared to last year. For
2025, Outokumpu’s energy portfolio has been hedged with roughly 65%–70% of the estimated
consumption.
Outokumpu has initiated and executed multiple actions to prevent risks from realizing. As
the volatility in the energy market continues, Outokumpu has increased its focus on daily
optimization to lower overall energy costs. Outokumpu has also started several initiatives to
accelerate the improvement in energy efficiency. See more information on energy in the Climate
change chapter in the Sustainability Statement (part of Review of Board of Directors), especially
under “Energy consumption and mix”.
Outokumpu is exposed to changes in emission allowance prices as the Group’s main
production sites are located in Europe and thus participating in the EU Emissions Trading
Scheme (EU ETS). All Outokumpu sites met the compliance requirements regarding returning of
Outokumpu Annual Report 2024
214
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
emissions to local authorities on time in 2024. The Group’s emission allowances positions are
composed of realized and forecasted emissions netted against confirmed and forecasted
emission allowances granted by the authorities. The general economic outlook, the prices of
fuels and power as well as decisions on the EU ETS have a significant impact on the price of
emission allowances. The current trading phase of the EU ETS refers to the period 2021–2030.
Outokumpu forecasts to have adequate amount of EU emission allowances until the end of this
decade. However, the future decisions on EU ETS may have a significant impact on this
forecast.
Security price risk
Outokumpu has equity investments and fixed income securities. On December 31, 2024, the
main investments were in OSTP Holding Oy (investment in associated company of EUR 33
million) and Voimaosakeyhtiö SF (investment in associated company of EUR 0 million). For more
information on the investments presented in notes 5.6 and 6.6.
The captive insurance company Visenta Försäkringsaktiebolag has investments totaling EUR
28 million in fixed income and equity funds in order to optimize return for assets and to
manage the risk prudently.
Country and counterparty credit risk
Treasury monitors credit risk related to financial institutions. Outokumpu seeks to reduce these
risks by limiting the counterparties to banks and other financial institutions with good credit
standing. For derivative transactions, Outokumpu prefers to have the ISDA framework
agreements in place.
Exposure to country risk is monitored and mitigated by having a credit insurance that
provides cover against political risks on external account receivables. However, there is some
exposure on certain countries where insurance was unavailable.
Insurances
As part of risk mitigation activities, Outokumpu aims to secure its assets and business
continuity by arranging insurances against financial losses arisen from unexpected risk events.
Risks related to property, business interruption, liabilities and credit risk are covered by
insurances as per policy terms and conditions. Outokumpu continued its systematic property
and marine cargo loss prevention programs, focusing on execution of the mitigating and
preventive actions.
Outokumpu has a captive insurance company, Visenta Försäkringsaktiebolag (Visenta), for
optimizing insurance arrangements as part of the Group’s risk management. The captive
insurance company is registered in Sweden and can operate as a direct insurer and reinsurer
for covering risk of Outokumpu Group entities only. Visenta has to comply with capital adequacy
requirements set by the financial supervisory authority in Sweden and European Insurance and
Occupational Pensions Authority (EIOPA). During the reporting period Visenta was well
capitalized to meet other externally imposed requirements, which are based on, e.g., the
Solvency II framework. There were no significant changes in Visenta’s assets during the year.
Outokumpu Annual Report 2024
215
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
5.4 Derivative instruments
2024
2023
2024
2023
€ million
Positive
fair value
Negative
fair value
Net fair
value
Net fair
value
Nominal
amounts
Nominal
amounts
Currency and interest rate
derivatives
Currency forwards
18
-4
14
-17
2,013
1,972
Interest rate swaps
—
-2
-2
-7
125
125
Tonnes
Tonnes
Metal derivatives
Forward nickel contracts,
hedge accounted
11
-7
5
7
16,984
22,823
Forward nickel contracts
5
-4
1
3
8,592
10,720
MWh
MWh
Gas derivatives
Forward gas contracts, hedge
accounted
4
0
4
—
917,408
—
Total derivatives
39
-17
22
-14
Less long-term derivatives
Forward nickel contracts,
hedge accounted
0
0
0
-1
Forward gas contracts, hedge
accounted
1
0
1
—
Interest rate swaps
—
—
—
-7
Short-term derivatives
39
-17
22
-6
Contractual cash flows
2024
€ million
2025
2026
Currency derivatives
Outflows
2,021
—
Inflows
-2,006
—
Interest derivatives
-5
—
10
—
2023
€ million
2024
2025
Currency derivatives
Outflows
1,964
—
Inflows
-1,980
—
Interest derivatives
-6
-6
-21
-6
Hedge accounted cash flow hedges (commodity derivatives)
2024
2023
Fair value of nickel derivatives, € million
5
7
Nominal amount of nickel derivatives, tonnes
16,984
22,823
Fair value of gas derivatives, € million
4
—
Nominal amount of gas derivatives, MWh
917,408
—
Hedge ratio
1:1
1:1
Fair value reserve in other comprehensive income, € million
10
7
Reclassified to sales in profit or loss, € million
13
16
Reclassified to cost of sales in profit or loss, € million
-6
2
Recognized in inventory, € million
2
4
The nickel hedge accounting programs implemented for business area Americas and business
area Europe cover a material part of the Group’s sales and purchase contracts. Forwards, which
correspond to the pricing model of the underlying items, are used as derivative instruments.
Only the spot component of nickel derivatives is under hedge accounting, the forward element
is recognized in profit or loss. The ineffectiveness is tested regularly. Management estimates
that the possible ineffectiveness that could arise relates to credit risk or timing of transactions,
but these are estimated to be immaterial.
In August 2024 a new LNG gas hedge accounting program was implemented for entity
Outokumpu Stainless Oy. The hedge accounting program covers a substantial part of the
purchases of LNG gas contracts. The derivative instrument used in hedging is a forward which
pricing corresponds to the pricing of the underlying item. The ineffectiveness is tested regularly.
Outokumpu Annual Report 2024
216
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Management estimates that the possible ineffectiveness that could arise relates to credit risk
or timing of transactions, but these are estimated to be immaterial.
Master netting agreements and similar arrangements
€ million
2024
2023
Derivative assets
Gross amounts of recognized financial assets in the
statement of financial position
39
34
Related financial instruments that are not offset
16
21
23
12
Derivative liabilities
Gross amounts of recognized financial liabilities in the
statement of financial position
17
47
Related financial instruments that are not offset
16
21
1
26
Outokumpu enters into derivative transactions with most counterparties under ISDA
agreements. In general, the amounts owed by each counterparty on a single day in respect of
all transactions outstanding in the same currency are aggregated into a single net amount that
is payable by one party to the other. In certain circumstances, e.g. when a credit event such as
a default occurs, all outstanding transactions under the agreement are terminated. The
termination value is assessed and only a single amount is payable in settlement of all
transactions. ISDA agreements do not meet the criteria for offsetting the balances in the
statement of financial position, but the right to offset is enforceable only on the occurrence of
future credit events. The table above sets out the carrying amounts of recognized financial
instruments that are subject to the agreements described above.
Accounting principles
Derivatives are initially recognized at fair value on the trade date, when the Group enters into a
derivative contract, and are subsequently measured at fair value.
The presentation of the gains or losses arising from the fair value measurement depends on
the purpose of the derivative. The gains or losses arising from fair value changes of effective
hedge-accounted derivative contracts are presented in profit or loss congruent with the hedged
item. Changes in fair value of derivative contracts, where hedge accounting is not applied, are
recognized in EBIT in other operating income and expenses. Changes in fair value of derivatives
designated for financing activities are presented within financial income and expenses.
The fair value measurement is based on quoted market prices and rates as well as on
discounted cash flows at the end of the reporting period. Fair values of derivatives can in
certain cases be based on valuations of external counterparties.
Hedge accounting
Outokumpu applies cash flow hedge accounting on certain commodity derivatives. For each
hedging arrangement the relationship between the hedging instrument and the hedged item,
the objectives of risk management and the strategy of the hedging arrangement are
documented.
The effectiveness of the hedge relationship is documented and assessed when hedging is
started and at least in the end of each reporting period. Hedge effectiveness is calculated and
assessed between the changes in the fair value or cash flows of the hedged item attributable to
the hedged risk and the changes in the fair value or cash flows of the hedging instrument to
ensure that these impacts offset one another. Hedge accounting is discontinued if the
requirements of hedge accounting are no longer met.
Fair value changes of derivatives designated to hedge forecasted cash flows are recognized
in other comprehensive income and presented within the fair value reserve in equity to the
extent that the hedge is effective. Such fair value changes accumulated in equity are
reclassified in profit or loss, and presented in sales or cost of sales in the period when the
hedge accounted cash flows affect the profit or loss. In the certain hedge accounted
transaction, the realized gains or losses of the nickel derivatives are first reclassified from fair
value reserves in equity to the inventory for a certain period and finally recognized in profit or
loss. The fair value changes related to the ineffective portion of the hedging instrument are
recognized immediately in profit or loss.
Outokumpu Annual Report 2024
217
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
5.5 Financial assets and liabilities
Carrying values and fair values of financial assets and liabilities by measurement category
Measured at
2024
€ million
Amortized cost
Fair value through other
comprehensive income
Fair value through profit
or loss
Carrying amount
Fair value
Fair value hierarchy level
Non-current financial assets
Equity investments
—
28
—
28
28
1,3
Trade and other receivables
10
—
0
10
0
3
Hedge accounted derivatives
—
—
1
1
1
2
Current financial assets
Other investments
—
—
28
28
28
1
Trade and other receivables
390
—
—
390
Hedge accounted derivatives
—
—
15
15
15
2
Derivatives held for trading
—
—
23
23
23
2
Cash and cash equivalents
313
—
—
313
714
28
67
809
Non-current financial liabilities
Non-current debt
246
—
—
246
247
2
Hedge accounted derivatives
—
—
0
0
0
2
Current financial liabilities
Current debt
256
—
—
256
273
2
Trade and other payables
1,144
—
—
1,144
Hedge accounted derivatives
—
—
7
7
7
2
Derivatives held for trading
—
—
10
10
10
2
1,646
—
17
1,663
There were no transfers between levels 1, 2 and 3 during the years. A major part of equity investments at fair value through other comprehensive income at hierarchy level 3 relates to investments in unlisted energy
producing companies.
Outokumpu Annual Report 2024
218
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Measured at
2023
€ million
Amortized cost
Fair value through other
comprehensive income
Fair value through profit
or loss
Carrying amount
Fair value
Fair value hierarchy level
Non-current financial assets
Equity investments
—
12
—
12
12
1,3
Trade and other receivables
12
—
0
12
0
3
Current financial assets
Other investments
—
—
27
27
27
1
Trade and other receivables1)
508
—
—
508
Hedge accounted derivatives
—
—
15
15
15
2
Derivatives held for trading
—
—
19
19
19
2
Cash and cash equivalents
502
—
—
502
1,022
12
60
1,094
Non-current financial liabilities
Non-current debt
359
—
—
359
443
2
Hedge accounted derivatives
—
—
1
1
1
2
Derivatives held for trading
—
—
7
7
7
2
Current financial liabilities
Current debt
82
—
—
82
82
2
Trade and other payables1)
1,086
—
—
1,086
Hedge accounted derivatives
—
—
7
7
7
2
Derivatives held for trading
—
—
32
32
32
2
1,528
—
47
1,575
Current debt includes EUR 38 million of share buyback program related financial liability.
1) The data has been revised.
Outokumpu Annual Report 2024
219
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Reconciliation of changes on level 3
€ million
Investments at fair value
through profit or loss
Equity investments at
fair value through other
comprehensive income
Carrying value on Jan 1, 2024
0
7
Additions
3
1
Disposals
—
—
Fair value changes
-3
15
Carrying value at the end of the period
0
23
€ million
Investments at fair value
through profit or loss
Equity investments at fair
value through other
comprehensive income
Carrying value on Jan 1, 2023
—
25
Additions
5
3
Disposals
—
0
Fair value changes
-5
-20
Carrying value at the end of the period
0
7
In 2023, Outokumpu Corporation agreed to participate in a convertible loan offered by
associated company Voimaosakeyhtiö SF to its shareholders. Outokumpu’s share of the
convertible loan is EUR 14 million. The first call of the loan was in August 2023 amounting to
EUR 5 million and the second one in October 2024, totaling to EUR 3 million. At the end of
December 2024, the loan is valued at EUR 0 million. The change in value is presented in the
other market price gains and losses in the consolidated statement of income, for more
information see note 2.5. For more information on Voimaosakeyhtiö SF, see note 5.7 and 6.6.
Accounting principles
The Group’s financial assets and liabilities are classified as items at fair value through profit or
loss, items at fair value through other comprehensive income and items at amortized cost.
The classification is based on Group’s business model for financial assets and liabilities, and
their contractual cash flow characteristics.
If a financial asset is not measured at fair value through profit or loss, significant transaction
costs are included in the initial carrying amount of the asset. Financial assets are derecognized
when the Group loses the rights to receive the contractual cash flows on the financial asset or it
transfers substantially all the risks and rewards of ownership outside the Group. Accounting
principles related to transaction costs and derecognition of borrowings are presented in note
5.1.
Financial assets and liabilities measured at amortized cost
Financial assets measured at amortized cost include trade and other receivables and
cash and cash equivalents. These assets are measured initially at fair value. After initial
recognition, they are measured at amortized cost by using the effective interest rate method
less accumulated impairments. The accounting principles related to factored receivables and
expected credit losses are presented in note 4.5.
Financial liabilities measured at amortized cost include the borrowing and trade and other
payables. See note 5.1 for further accounting and fair valuation principles for borrowings and
note 4.5 for accounting principles for trade and other payables.
Financial assets at fair value through other comprehensive income
Financial assets at fair value through other comprehensive income include equity investments
in listed and unlisted companies. Accounting principles are presented in note 5.6.
Financial assets and liabilities at fair value through profit or loss
Financial assets and liabilities at fair value through profit or loss include derivative instruments.
Financial assets at fair value through profit or loss include also investments in debt instrument
or money market funds held for trading purposes and intended to be sold within a short period
of time. In some cases, also equity investments can be classified in this category.
These financial assets and liabilities are recognized at the trade date at fair value and
subsequently remeasured at fair value at the end of each reporting period. The fair value
measurement is based on quoted rates and market prices as well as on appropriate valuation
methodologies and models.
Realized and unrealized gains and losses arising from changes in fair values of non-
derivative financial assets are recognized in market price gains and losses under financial
income and expenses in the reporting period in which they are incurred. Accounting principles
related to derivatives are described in more detail in note 5.4.
Measurement of fair values
Several accounting policies and disclosures require the measurement of fair values.
Financial assets and liabilities measured at fair value are classified to fair value hierarchy levels
based on the source information and inputs used in the fair valuation. In level one, fair values
are based on public quotations for identical instruments. In level two, fair values are based on
market rates and prices and discounted future cash flows. For assets and liabilities in level
three, there is no reliable market source available and thus the fair value measurement is not
based on observable market data. Therefore, the measurement methods are chosen taking into
account the information available for the measurement and the characteristics of the measured
item.
Outokumpu Annual Report 2024
220
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
5.6 Equity investments at fair value through other comprehensive income
€ million
2024
2023
Carrying value on Jan 1
12
25
Additions
2
11
Disposals
—
0
Fair value changes
13
-23
Carrying value on Dec 31
28
12
Fair value reserve in equity
€ million
2024
2023
Fair value on Dec 31
28
12
Reclassification
—
-117
Fair value at acquisition
14
129
Fair value reserve
14
1
Equity investments at fair value through other comprehensive income include unlisted and
listed strategic holdings mainly in energy companies in which Outokumpu does not have control,
joint control or significant influence.
These energy companies produce energy to their shareholders on a cost-price basis (Mankala
principle) which is a widely used business model among Finnish energy companies. Under the
Mankala principle, shareholders are entitled to receive energy in proportion to the ownership,
and each shareholder is severally responsible for its respective share of the costs of the energy
company as set out in the articles of association.
The additions of EUR 2 million in 2024 are related to the increase in investments in FPX Nickel
corp and in EPV Energia Oy.
Outokumpu is an owner in nuclear utility by provider Pohjolan Voima Oy (PVO), with an
ownership share of 0.1%. PVO is a shareholder in Teollisuuden Voima Oy (TVO). TVO, where
Outokumpu does not have a direct ownership, operates Olkiluoto 3 (OL3) a nuclear power plant
in Eurajoki, Finland. Outokumpu has indirect ownership in Tornion Voima Oy, a combined heat
and power plant in Tornio, Northern Finland. This indirect ownership is through EPV Energia Oy,
with an ownership share of 0.3%. In addition, Outokumpu has a direct ownership in Rajakiiri Oy
with a share of 19.9%. Rajakiiri Oy is a wind power mill in Tornio. The total estimated fair value
of the aforementioned three utility assets was EUR 22 million at the year end (Dec 31, 2023:
EUR 6 million). The remaining EUR 6 million (Dec 31, 2023: EUR 6 million) are other share
holdings.
During the year 2023 Outokumpu’s investment in Voimaosakeyhtiö SF, which is the majority
shareholder of Fennovoima, was reclassified from equity investments at fair value through other
comprehensive income to associated company. Consequently EUR 117 million was reclassified
from fair value reserve in equity to other retained earnings within equity.
Management judgements
Unlisted strategic energy companies
The valuation model of the other unlisted strategic energy companies include among others
discount rate derived from risk free rate (Germany 10 year bond yield), growth factor depending
the nature of the power plant or wearing out of the mill and contractual factors which may have
an impact on the valuation. Discounted cash flow models include also adjustments based on
the latest information regarding the power plants and potential energy production.
Accounting principles
Equity investments at fair value through other comprehensive income consists of investments
which are not held for trading, and which the Group has irrevocably elected at initial recognition
to recognize in this category. These are mainly strategic investments, so this classification is
considered relevant.
The investments and divestments are recognized at the trade date. They are included in non-
current assets unless there is an intention to dispose of the investment within 12 months from
the reporting date.
The investments are measured at fair value, and fair value changes are recognized through
other comprehensive income and presented net of tax in fair value reserve in equity. The
valuation is based on quoted rates and market prices at the end of the reporting period, as well
as on appropriate valuation techniques, such as cash flow discounting. Observable market data
is used in the valuation when available but also entity-specific management estimates are
applied.
Dividends are recognized in profit or loss. When equity investment is disposed, the
accumulated fair value changes are reclassified from fair value reserve to retained earnings.
The premium paid over the FPX Nickel Corp. share's market price at the acquisition date has
been treated as part of the inventory and will be released at the time of the nickel purchase.
Outokumpu Annual Report 2024
221
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
5.7 Commitments and contingent liabilities
€ million
2024
2023
Mortgages and pledges on Dec 31
Mortgages
156
156
Other pledges
13
13
Guarantees on Dec 31
On behalf of subsidiaries for commercial and other
commitments
34
51
Other commitments for financing on Dec 31
4
2
Outokumpu has issued business mortgages over movable assets in Kemi to secure an
outstanding project loan maturing in September 2030.
Outokumpu is liable for its associated company Manga LNG Oy’s certain liabilities amounting to
EUR 9 million at the end of the reporting period (December 31, 2023 EUR 12 million). In the
table above, this commitment is reported as other pledges (Outokumpu’s shares in Manga LNG
Oy).
Outokumpu Corporation is, in relation to its shareholding in EPV Energia Oy, liable for the costs,
commitments and liabilities relating to electricity provided by Tornion Voima Oy. These
commitments are reported under other commitments for financing.
The old long-term energy supply contract that included a minimum purchase quantity has been
terminated at the end of the year 2024 with no additional costs to the Group.
The Group's other off-balance sheet investment commitments totaled EUR 42 million on
December 31, 2024 (December 31, 2023: EUR 46 million).
Contingent liabilities
Outokumpu is a minority shareholder in its associated company Voimaosakeyhtiö SF, which is
the majority shareholder of Fennovoima Oy. There is a pending arbitration between Fennovoima
Oy and Rosatom entities related to the termination of the EPC (Engineering, Procurement and
Construction) contract for a nuclear power plant. Outokumpu Corporation is not a party in the
said dispute.
Originally, Outokumpu’s commitment to Voimaosakeyhtiö SF for participation in the planned
nuclear power plant project amounted to approximately EUR 250 million, of which EUR 117
million has been paid. Further payments related to the original commitment, if any, are not
expected to occur.
Accounting principles
Unrecognized commitments are disclosed when the Group has an obligation or a pledge to
assume a financial liability at a future date.
A contingent liability is a possible obligation that arises from past events and the existence
of which will be confirmed by uncertain future events that are not wholly within the control of
the entity. Obligations that are not considered probable or where the amounts cannot be
reliably measured are also considered as contingent liabilities. Contingent liabilities are not
recognized in the statement of financial position but disclosed as off-balance sheet
commitments.
Outokumpu Annual Report 2024
222
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
6. Group structure and other notes
This notes section covers the notes related to the Group structure,
as well as other notes that do not directly fall under any of the previous notes sections.
6.1 Discontinued operations
Long Products as discontinued operations in 2022
During the year 2022, Outokumpu signed an agreement to divest the majority of the Long
Products business operations to Marcegaglia Steel Group and reported it as assets held for sale
and discontinued operations. The divestment was completed on January 3, 2023. The
provisional gain on divestment reported in the net result from discontinued operations of the
year 2023 was EUR 5 million. During the first half of the year 2024, the agreement on the
release of the escrow account was finalized and had no significant impact on the financial
statements.
Gain on sale
€ million
Final outcome
Total net assets sold as of Jan 3, 2023
-215
Sale consideration
211
Other
-4
Gain on sale of discontinued operations before reclassification of accumulated
translation differences
-8
Reclassification of accumulated translation differences
10
Gain on sale 1)
2
1) The net result for the period from discontinued operations in 2023 EUR 5 million is related to the gain on
sale presented in line other operating income in the discontinued operations’ statement of income. The
impact from the release of the escrow account was booked to the net result in continuing operations in
2024.
€ million
Final outcome
Cash flow
Cash consideration
211
Cash and cash equivalents
-117
Escrow account receivable
—
Consideration received
94
Accounting principles
Non-current assets or a disposal group are classified as held for sale if their carrying amount
will be recovered principally through the disposal of the assets and the sale is highly probable.
If their carrying amount will be recovered principally through their disposal rather than through
their continuing use, they are measured at the lower of carrying amount and fair value less cost
to sell. Property, plant and equipment and intangible assets are not depreciated or amortized
once classified as held for sale.
Result from the discontinued operations is reported separately from income and expenses
from continuing operations in the consolidated statement of income and prior periods are
restated accordingly. Assets and liabilities related to the discontinued operations are presented
as separate line items in the statement of the financial position and the comparative period is
not restated. The statement of cash flows consists of total group figures including the dis-
continued operations.
Intra-group revenues and expenses between continuing and discontinued operations are
eliminated in continuing operations only when the revenues and expenses are not considered to
continue after the disposal of the discontinued operations.
Outokumpu Annual Report 2024
223
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
6.2 Business acquisitions and disposals
2024
Disposals
In 2024, Outokumpu divested its Mexico branch distribution business in Mexico
City, Guadalajara and Monterrey – formerly known as Outokumpu Mexinox Distribution. Prominox,
the largest stainless steel distributor in Mexico, acquired the ongoing business operations
and customer base from Outokumpu. They were reported under the operation of Outokumpu's
business area Americas. The net asset value was EUR 1 million and the gain on sale was EUR 3
million. The transaction had a positive cash impact for Outokumpu amounting to EUR 4 million.
See more information on divestment of Long Products in note 6.1.
2023
Disposals
During the year 2023 Outokumpu divested its remaining Long Products operations in Degerfors
and Storfors, Sweden to Cogne Acciai Speciali, a world leader in the production of long stainless
steels and nickel alloys based in Italy. The enterprise value of the transaction was EUR 12
million and it had a positive cash impact for Outokumpu amounting to EUR 2 million.
Outokumpu booked a loss of EUR 26 million on the disposal.
€ million
2023
Total net assets sold
-32
Sale consideration
5
Loss on sale
-26
Accounting principles
The disposed companies are included in the consolidated Financial Statements up to
the date when the control is lost. The gain or loss on disposal together with cumulative
translation adjustments related to disposed companies are recognized in the consolidated
statement of income at the date control is lost.
Outokumpu Annual Report 2024
224
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
6.3 Disputes and litigations
Dispute over payment of wages in the US
On July 16, 2018, a class of plaintiffs, eventually consisting of 278 former and current
Outokumpu Calvert mill employees, brought a suit against Outokumpu Stainless USA, LLC in the
U.S. federal district court. The plaintiffs alleged that Outokumpu failed to pay full wages for
regular work and overtime work they performed. The district court entered a default judgment
against Outokumpu in 2021 with respect to liability without Outokumpu having the opportunity
to argue the merits of the allegations and subsequently found Outokumpu liable to the plaintiffs
for approximately USD 13 million in the aggregate, plus attorney’s fees. Outokumpu appealed
these decisions at the time. The Court of Appeals has on October 11, 2024 upheld the district
court’s decisions. On November 1, 2024, Outokumpu filed a petition for a rehearing before the
court of appeals which the court of appeals denied on December 6, 2024. The case has been
returned to the district court for a final determination of the amount of Outokumpu’s liability.
Outokumpu has a USD 18.9 million provision in respect of this matter.
Claim in Germany related to expired lease agreement
On January 19, 2018, Outokumpu Nirosta GmbH was served with a claim in the district court of
Krefeld for declaratory judgement by the owner of a warehouse in Krefeld that Outokumpu had
leased until the end of 2016. The claim relates to a dispute over the responsibility for the
maintenance and repair of the warehouse. The claimant has later in the process specified the
claim and is seeking a payment of EUR 19 million. On May 4, 2022, the court issued a ruling
covering only the merits of the claim. Said ruling was in favor of the claimant and was appealed
by Outokumpu in the court of appeal. On June 15, 2023, the court of appeal cancelled the said
ruling, and referred the dispute back to the lower court where the matter is still pending.
Outokumpu is of the view that the claims asserted against it are without merit and continues to
defend against them. Appropriate provisions are in place.
6.4 Related parties
Balances and transactions within Group including parent company and its subsidiaries have
been eliminated on consolidation and are not disclosed in this note. Related party transactions
disclosed in this note include transactions with associated companies, Solidium Oy and the key
management of the company as well as their related persons and companies in which they
have control or joint control. Key management includes Leadership Team members and
members of the parent company’s Board of Directors, and their remuneration is presented in
the note 3.2. Commitments related to associated companies are presented in the note 5.7.
The principal subsidiaries and associated companies are listed in the notes 6.5 and 6.6.
Solidium Oy, a limited company fully owned by the State of Finland, owned 15.5% of Outokumpu
on December 31, 2024. Solidium’s mission is to strengthen and stabilize Finnish ownership in
nationally important companies and increase the value of its holdings in the long run.
Transactions with related parties are carried out at arms-length principles.
Transactions and balances with related companies
€ million
2024
2023
Sales and other operating income
87
99
Purchases
-93
-51
Dividend income
1
3
Trade and other receivables
25
35
Trade and other payables
11
5
All the transactions and balances with related companies are related to associated companies.
Increase in purchases and trade and other payables is mainly due to the acquisition of German
company CRONIMET North-East GmbH, more information in the note 6.6.
In 2023, Outokumpu Corporation agreed to participate in a convertible loan offered by
associated company Voimaosakeyhtiö SF to its shareholders. Outokumpu’s share of the
convertible loan is EUR 14 million. The first call of the loan was in August 2023 amounting to
EUR 5 million and the second one in October 2024, totaling to EUR 3 million. At the end of
December 2024, the loan is valued at EUR 0 million.
Outokumpu Annual Report 2024
225
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
6.5 Subsidiaries
December 31, 2024
Country
Group
holding, %
Europe
Outokumpu AS
Norway
100
Outokumpu Distribution France S.A.S.
France
100
Outokumpu Distribution Hungary Kft.
Hungary
100
Outokumpu Distribution Polska Sp. z o.o.
Poland
100
Outokumpu Europe Oy 1)
Finland
100
Outokumpu India Private Limited
India
100
Outokumpu Management (Shanghai) Co., Ltd 1)
China
100
Outokumpu Middle East FZCO
United Arab Emirates
100
Outokumpu Nirosta GmbH
Germany
100
Outokumpu N.V.
Belgium
100
Outokumpu Prefab AB
Sweden
100
Outokumpu Press Plate AB
Sweden
100
Outokumpu PSC Finland Oy
Finland
100
Outokumpu (Pty) Ltd
South Africa
100
Outokumpu S.A.
Spain
100
Outokumpu (S.E.A.) Pte. Ltd
Singapore
100
Outokumpu Shipping Oy
Finland
100
Outokumpu S.r.l.
Italy
100
Outokumpu Stainless AB
Sweden
100
Outokumpu Stainless B.V.
The Netherlands
100
Outokumpu Stainless Ltd
The United Kingdom
100
Outokumpu Stainless Oy
Finland
100
Outokumpu Stainless Pty Ltd
Australia
100
Outokumpu Stainless Steel (China) Co., Ltd
China
100
Outokumpu Tornio Infrastructure Oy
Finland
100
December 31, 2024
Country
Group
holding, %
Americas
Outokumpu Brasil Comércio de Metais Ltda
Brazil
100
Outokumpu Mexinox S.A. de C.V.
Mexico
100
Outokumpu Stainless USA, LLC
The United States
100
ThyssenKrupp Mexinox CreateIT, S.A. de C.V.
Mexico
100
Ferrochrome
Outokumpu Chrome Oy 1)
Finland
100
Other operations
Outokumpu Americas, Inc.
The United States
100
Outokumpu Distribution Benelux B.V.
The Netherlands
100
Outokumpu Holding Germany GmbH 1)
Germany
100
Outokumpu Holding Nederland B.V. 1)
The Netherlands
100
Outokumpu Mining Oy
Finland
100
Outokumpu Stainless Holding GmbH
Germany
100
Outokumpu Stainless UAB
Lithuania
100
Viscaria AB 1)
Sweden
100
Visenta Försäkrings AB
Sweden
100
This list does not include all dormant companies. In addition, Outokumpu has branch offices in Portugal,
South Korea, Taiwan, Thailand, the United Kingdom, Turkey and Vietnam.
1) Shares and stock fully held by the parent company
Outokumpu Annual Report 2024
226
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
6.6 Associated companies
Industry
Domicile
Ownership, %
CRONIMET North-East GmbH
Scrap metal trading
Germany
10
Envigas AB
Energy
Sweden
21
Manga LNG Oy
Energy
Finland
45
OSTP Holding Oy
Metals processing
Finland
49
Voimaosakeyhtiö SF
Energy
Finland
23
Summarized financial information on associated companies
€ million
2024
2023
Carrying value of investments in associated companies
77
62
Group’s share of total comprehensive income
3
5
The carrying amounts of individual associated companies are immaterial in the Group's
consolidated Financial Statements.
Outokumpu is a minority shareholder in its associated company Voimaosakeyhtiö SF, which is
the majority shareholder of Fennovoima Oy. The value of the investment in Voimaosakeyhtiö SF
is EUR 0 million at the end of December 2024 (Dec 31, 2023: EUR 0 million).
In November 2023, Outokumpu signed an agreement to become a minority shareholder in the
German company CRONIMET North-East GmbH, with an ownership share of 10%. The
transaction was finalized on January 24, 2024 and it was carried out as a share purchase.
CRONIMET is reported as an associated company using the equity accounting method.
See the commitments related to the associated companies in note 5.7.
Accounting principles
Companies where Outokumpu generally holds voting rights of 20–50% or in which Outokumpu
otherwise has significant influence, but not control, are included in the consolidated Financial
Statements as associated companies, and they are accounted for using the equity method from
the date significant influence was obtained until it ceases.
The Group’s share of the associated company’s net result for the period is separately
disclosed below Operating profit (EBIT) in the consolidated statement of income. Outokumpu’s
share of changes recognized in the associated company’s other comprehensive income is
recognized in the Group’s other comprehensive income.
If Outokumpu’s share of the associated company’s losses exceeds the carrying amount of
the investment, the investment is recognized at zero value in the statement of financial position
and recognition of further losses is discontinued, except to the extent that the Group has
incurred obligations in respect of the associated company. The interest in an associated
company comprises the carrying amount of the investment under the equity method together
with any long-term interest that, in substance, forms a part of the net investment in the
associated company.
Outokumpu Annual Report 2024
227
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
6.7 New IFRS standards
Adoption of new and amended IFRS standards
Certain new accounting standard amendments and interpretations have been published that
came into effect only after the reporting period started on January 1, 2024. These standards
and amendments have not been early adopted nor are expected to have a material impact on
Outokumpu’s current or future reporting periods nor foreseeable future transactions except for
the IFRS 18 Presentation and Disclosure of Financial Statements that will come into effect on
January 1, 2027. Outokumpu will evaluate in more detail the possible impacts of IFRS 18 but is
expecting it to have impacts on the presentation and the disclosures of the Financial
Statements of the Group.
6.8 Events after the balance sheet date
After the reporting period, on February 14, 2025, Outokumpu announced that on February
14, 2025, the Arbitral Tribunal confirmed that it does not have jurisdiction to adjudicate
claims brought by RAOS Project Oy and JSC Rusatom Energy International (JSC REIN)
against Outokumpu in arbitration proceedings over a dispute between Fennovoima Oy and
Rosatom entities related to the termination of the EPC (Engineering, Procurement and
Construction) contract between Fennovoima Oy and RAOS Project Oy in May 2022, into
which Outokumpu Corporation was joined in 2023. The arbitration proceedings with respect
to Outokumpu therefore have ended.
After the reporting period, on February 13, 2025, Outokumpu announced that it finalizes study
on emerging nuclear technology and seeks external investors to complete the project.
After the reporting period, on February 13, 2025, Outokumpu announced, that based on an
extensive feasibility study, the company decided not to invest in the expansion of its cold rolling
capacity in the U.S. at this point of time. On August 3, 2023, Outokumpu had announced that it
is seeking to increase its existing cold rolling capacity as part of the third strategy phase
preparations.
After the reporting period, on February 12, 2025, Outokumpu appointed Matthieu Jehl as
President, business line Stainless Europe and member of the Outokumpu Leadership team as
of May 26, 2025, at the latest.
After the reporting period, on January 22, 2025, Outokumpu updated its financial reporting
schedule for 2025. Outokumpu has previously announced that it will publish the January-
September 2025 interim report on October 30, 2025. The new publication date is October 29,
2025.
After the reporting period, on January 9, 2025, Outokumpu announced that the mineral
reserves in Kemi chrome mine were increased by 95%. The increase in the mineral reserves is
based on new underground drilling, proving that the ground at the mine area is rich in chrome
ore, which extends the life of the Kemi mine substantially.
After the reporting period, on January 7, 2025, Outokumpu announced a change to the
proposals of the Shareholders' Nomination Board to the Annual General Meeting 2025. As a
change to the earlier announcement, Pierre Vareille, a current member of the Board of
Directors, has subsequently notified the Shareholders' Nomination Board that he is no longer
available for re-election for personal reasons. Consequently, the Shareholders' Nomination
Board proposes that Board of Directors would consist of eight (8) members instead of the
earlier announced nine (9).
Outokumpu Annual Report 2024
228
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Parent company Financial Statements, FAS
Income statement of the parent company
€ million
2024
2023
Sales
303
423
Cost of sales
-209
-313
Gross margin
93
111
Other operating income
10
30
Administrative expenses
-146
-156
Other operating expenses
-5
-20
Operating profit (EBIT)
-48
-36
Financial income and expenses
112
96
Result before appropriations and taxes
64
60
Appropriations
Group contribution
46
17
Change in depreciation difference
0
1
Income taxes
0
-3
Net result for the financial year
110
75
The presentation of the Income statement has been changed in 2024 by reclassifying the subsidiary share
impairments and reversal of impairments from Other operating income to Financial income and expenses.
The comparative information has been changed accordingly.
Outokumpu Annual Report 2024
229
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Balance sheet of the parent company
€ million
2024
2023
ASSETS
Non-current assets
Intangible assets
115
91
Property, plant and equipment
2
3
Financial assets
Shares in Group companies
4,033
3,952
Loan receivables from Group companies
507
532
Shares in associated companies
13
13
Other shares and holdings
2
1
Other financial assets
1
3
4,556
4,500
Total non-current assets
4,673
4,594
Current assets
Current receivables
Loans receivable
230
80
Receivables from group companies
22
—
Trade receivables
60
80
Prepaid expenses and accrued income
15
25
Other receivables
102
75
428
260
Cash and cash equivalents
267
470
Total current assets
695
730
TOTAL ASSETS
5,368
5,324
€ million
2024
2023
EQUITY AND LIABILITIES
Shareholders’ equity
Share capital
311
311
Premium fund
720
720
Invested unrestricted equity reserve
2,186
2,220
Retained earnings
259
294
Result for the financial year
110
75
3,587
3,621
Untaxed reserves
Accumulated depreciation difference
0
0
Liabilities
Non-current liabilities
Convertible bonds
—
125
Other non-current loans
1
8
1
133
Current liabilities
Group bank account liabilities
861
978
Other current loans
565
398
Commercial papers
79
—
Convertible bonds
125
—
Trade payables
86
88
Accrued expenses and prepaid income
13
17
Other current liabilities
51
89
1,780
1,570
Total liabilities
1,781
1,703
TOTAL EQUITY AND LIABILITIES
5,368
5,324
Outokumpu Annual Report 2024
230
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Cash flow statement of the parent company
€ million
2024
2023
Cash flow from operating activities
Net result for the financial year
110
75
Adjustments
Depreciation and amortization
13
11
Gain/loss on sale of intangible assets, and property, plant
and equipment
-6
-30
Unrealized exchange gains/losses
-3
-2
Financial income and expenses
-112
-96
Group contribution
-46
-17
Change in depreciation difference
0
-1
Taxes
0
3
Other adjustments
—
24
-155
-108
Change in working capital
Trade and other receivables increase (-)/decrease (+)
31
-6
Trade and other payables increase (+)/decrease (-)
-24
-77
7
-83
Dividends received
0
—
Interest received and other financial income
54
66
Interest paid and other financial expenses
-89
-73
Income taxes paid
0
-5
-36
-13
Net cash from operating activities
-74
-128
The presentation of the Cash flow statement has been changed in 2024. The comparative information has
been changed accordingly.
€ million
2024
2023
Cash flow from investing activities
Investments in subsidiaries and other shares and holdings
-1
—
Purchases of intangible assets
-27
-17
Purchases of intangible rights
-10
—
Proceeds from disposal of subsidiaries and returns
49
28
Proceeds from disposal of other shares and holdings
—
0
Purchases of property, plant and equipment
0
-1
Proceeds from sale of intangible assets
8
37
Increase in Group loans receivables (-)
—
-193
Decrease in Group loans receivables (+)
—
421
Net cash from investing activities
19
276
Cash flow before financing activities
-55
148
Cash flow from financing activities
Dividends paid
-110
-152
Treasury shares purchase
-34
-70
Repayments of non-current debt (-)
—
-154
Change in current debt, net increase (+)/decrease (-)
247
86
Group contributions received (+)/paid (-)
17
117
Change in In-house cash account
-267
-7
Net cash from financing activities
-148
-179
Net change in cash and cash equivalents
-203
-31
Net change in cash and cash equivalents in the balance
sheet
-203
-31
Outokumpu Annual Report 2024
231
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Notes to the parent company Financial Statements
1. Accounting principles
Outokumpu Corporation’s Financial Statements have been prepared in accordance with the
Finnish accounting standards, and related laws and regulations that are effective for the
financial year ending on December 31, 2024.
Foreign currency transactions and derivative financial instruments
Foreign currency transactions are recognized using the exchange rates prevailing at the
dates of the transactions. Receivables and liabilities in foreign currencies are translated
into euro at European Central Bank exchange rates prevailing at the end of the reporting
period. Advance payments paid and received are presented at the exchange rates
prevailing at the payment dates.
Exchange rate, interest rate and metal derivatives are recognized to the balance sheet at
fair value on the trade date, and they are subsequently valued at fair value using market
rates and prices, discounted cash flows and option valuation models.
The realized and unrealized gains and losses arising from fair value changes of derivative
instruments are recognized in other operating income and expenses, or, in case the
derivative instrument is related the financing activities, in financial income and expenses.
Sales
Sales includes sales of electricity to the Group’s Nordic production facilities, consulting and
other services to subsidiaries. Revenue is recognized when the goods have been transferred
or the services performed. Sales are presented net of indirect taxes and rebates.
Cost of sales
Cost of sales includes expenses related to energy, IT services and supplies. Depreciation
and other expenses are included to the extent they relate to operational activities.
Administrative expenses
Administrative expenses include mainly costs related to salaries and social costs, IT and
other external services, rents and depreciation.
Other operating income and expenses
Other operating income and expenses include items not belonging to main business such
as rental income from real estate, gains and losses from disposals of businesses, property,
plant and equipment, and intangible assets, impairments, and gains and losses from
derivative financial instruments, other than from instruments relating to financing activities.
Appropriations
Appropriations include group contributions and the depreciation difference.
Income taxes
Income taxes include the income taxes for the current financial year as well as adjustments
to prior year taxes.
Non-current assets
Intangible assets and property, plant, and equipment are measured in the balance sheet at
cost less accumulated amortization, depreciation, and impairment losses. Lease payments
are recognized into profit or loss as rental or lease expenses, and leased assets are not
presented in the balance sheet. The planned amortization and depreciation of intangible
assets and property, plant and equipment is based on cost and estimated useful life, and
are calculated on straight-line basis or as a percentage of residual value.
The estimated useful lives are as follows:
•
Intangible assets
5–10 years
•
Other long-term expenses
5–10 years
•
Buildings
20–40 years
•
Machinery and equipment
5–20 years
•
Other tangible assets
4–40 years
Impairment of property, plant and equipment, as well as certain intangible assets are
evaluated, when events or changes in circumstances indicate that future cash flows may
not be sufficient to cover the asset book values. In an event of an impairment, the asset
book values are impaired to the level of discounted future cash flows.
Financial assets include investments and receivables that are estimated to be held for
longer than one year. Investments are valued at cost or at a lower probable value.
The subsidiary share values are reviewed as part of the asset impairment testing at the
Group level, where cash flow forecasts based on value-in-use have been prepared for the
Group’s cash generating units. In subsidiary share impairment testing, these cash flow
forecasts are further allocated to amounts recoverable from different sub-groups and
subsidiaries. When permanent, an impairment is recognized if the total of the subsidiary
share value, the net loan receivables from the subsidiary or sub-group, and the net Group
external debt in the subsidiary or sub-group exceeds the recoverable amount attributed to
this subsidiary or sub-group. A previously recognized impairment loss is reversed if there is
an permanent increase in the recoverable amount.
Outokumpu Annual Report 2024
232
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Emission allowances
Emission allowances are intangible assets valued at cost. Gains and losses from sales of
emission allowances are presented in other operating income and expenses.
Issue of equity
Proceeds from equity issues are recognized into equity in their entirety on gross basis.
Costs related to related issues of equity are recognized as financial and administrative
expenses.
Share buyback program
The share repurchases are funded by using funds from the invested unrestricted equity
reserve.
Debt
Debt, including bonds and convertible bonds, is recognized in the balance sheet at nominal
value. Arrangement fees are recognized as accrued expenses in the balance sheet and
expensed to profit or loss over the arrangement period.
Cash and cash equivalents
Cash and cash equivalents include cash at hand, cash in bank accounts, deposits maturing
in three months or less, and other cash equivalent assets.
2. Personnel expenses
€ million
2024
2023
Wages and salaries
-22
-21
Pension contributions
-4
-3
Other personnel expenses
1
0
Personnel expenses on income statement
-24
-24
Information about employee benefits of the CEO and the remuneration of Board of
Directors is presented in the consolidated Financial Statements note 3.2.
2024
2023
Average number of personnel
185
154
3. Depreciation and amortization
€ million
2024
2023
Depreciation and amortization by group of assets
Patents, licenses and other intangible rights
-1
-1
IT systems and other long-term expenditure
-11
-10
Buildings
0
0
Machinery and equipment
0
0
-13
-11
Depreciation and amortization by function
Cost of sales
-9
-8
Administrative expenses
-4
-3
-13
-11
Outokumpu Annual Report 2024
233
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
4. Cost of sales
€ million
2024
2023
Purchases of electricity
-174
-280
Depreciation
-9
-8
IT services and supplies
-26
-23
Other costs
0
-2
-209
-313
5. Other operating income
€ million
2024
2023
Other operating income
Market price gains and losses from derivatives
3
—
Gains on sale of intangible and property, plant and
equipment and shares
6
30
Other income
0
0
10
30
6. Other operating expenses
€ million
2024
2023
Other operating expenses
Market price gains and losses from derivatives
-1
-20
Losses on disposals of intangible assets and property, plant
and equipment
0
0
Other expenses
-4
0
-5
-20
7. Audit fees
€ million
2024
2023
Audit
-1.2
-1.1
Other services
-0.2
-0.1
Other services include audit fee for the Sustainability Statement.
8. Financial income and expenses
€ million
2024
2023
Interest income on long-term financial assets
34
41
Interest income on current assets
21
22
Other financial income
2
2
Impairments and impairment reversals of subsidiary shares
130
103
Interest expenses
-79
-76
Impairments
-3
-5
Other financial expenses
-8
-8
Exchange gains and losses
15
16
112
96
Financial income from and expenses to subsidiaries
Interest income on long-term financial assets
34
41
Interest income on current assets
10
8
Other financial income
2
2
Interest expenses
-67
-62
-21
-12
In 2023, Outokumpu Corporation agreed to participate in a convertible loan offered by
associated company Voimaosakeyhtiö SF to its shareholders. Outokumpu’s share of the
convertible loan is EUR 14 million. The first call of the loan was in August 2023 amounting
to EUR 5 million and the second one in October 2024, totaling to EUR 3 million. At the end
of December 2024, the loan is valued at EUR 0 million. Impairments in years 2024 and
2023 are related to this Fennovoima loan write down.
Outokumpu Annual Report 2024
234
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
9. Intangible assets
€ million
Patents, licenses and other
intangible rights
IT systems and other long-term
expenditure
Construction work in progress
Emission allowances
Total
Historical cost on Jan 1, 2024
41
185
31
3
260
Additions
0
1
27
10
39
Disposals
0
0
—
-2
-2
Reclassifications
1
10
-11
—
0
Historical cost on Dec 31, 2024
43
196
47
11
297
Accumulated amortization and impairment on Jan 1, 2024
-37
-132
—
—
-169
Disposals
0
0
—
—
0
Amortization
-1
-11
—
—
-12
Accumulated amortization and impairment on Dec 31, 2024
-38
-143
—
—
-181
Carrying value on Dec 31, 2024
5
53
47
11
115
Carrying value on Jan 1, 2024
4
52
31
3
91
Historical cost on Jan 1, 2023
41
185
8
10
244
Additions
0
0
24
—
24
Disposals
0
-1
—
-7
-8
Reclassifications
—
—
0
—
0
Historical cost on Dec 31, 2023
41
185
31
3
260
Accumulated amortization and impairment on Jan 1, 2023
-36
-123
—
—
-159
Disposals
0
1
—
—
1
Amortization
-1
-10
—
—
-11
Accumulated amortization and impairment on Dec 31, 2023
-37
-132
—
—
-169
Carrying value on Dec 31, 2023
4
52
31
3
91
Carrying value on Jan 1, 2023
5
62
8
10
85
Outokumpu Annual Report 2024
235
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
10. Property, plant and equipment
€ million
Land
Buildings
Machinery and equipment
Other tangible assets
Total
Historical cost on Jan 1, 2024
0
4
2
0
6
Additions
—
—
0
—
0
Disposals
—
—
0
—
0
Reclassifications
—
0
—
—
0
Historical cost on Dec 31, 2024
0
4
1
0
6
Accumulated depreciation and impairment on Jan 1, 2024
—
-2
-1
0
-3
Disposals
—
—
0
—
0
Depreciation
—
0
0
—
0
Accumulated depreciation and impairment on Dec 31, 2024
—
-2
-1
0
-3
Carrying value on Dec 31, 2024
0
1
1
0
2
Carrying value on Jan 1, 2024
0
1
1
0
3
Historical cost on Jan 1, 2023
0
3
1
0
6
Additions
—
0
0
—
1
Disposals
0
0
0
—
0
Reclassifications
—
0
0
—
0
Historical cost on Dec 31, 2023
0
4
2
0
6
Accumulated depreciation and impairment on Jan 1, 2023
—
-2
-1
0
-3
Disposals
—
0
0
—
0
Depreciation
—
0
0
—
0
Accumulated depreciation and impairment on Dec 31, 2023
—
-2
-1
0
-3
Carrying value on Dec 31, 2023
0
1
1
0
3
Carrying value on Jan 1, 2023
0
1
1
0
2
Outokumpu Annual Report 2024
236
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
11. Non-current financial assets
€ million
Shareholdings in Group
companies
Non-current loan receivables
from Group companies
Shares in associated
companies
Other shares and
holdings
Other non-current
financial assets
Total
Historical cost on Jan 1, 2024
3,952
532
13
1
3
4,500
Additions
—
—
—
1
0
1
Disposals and decreases
-49
-25
—
—
-2
-76
Impairments (-) and reversals of impairments (+)
130
—
—
—
—
130
Historical cost on Dec 31, 2024
4,033
507
13
2
1
4,556
Carrying value on Dec 31, 2024
4,033
507
13
2
1
4,556
Carrying value on Jan 1, 2024
3,952
532
13
1
3
4,500
Historical cost on Jan 1, 2023
3,877
127
13
1
3
4,021
Additions
—
405
—
0
1
406
Disposals and decreases
-28
—
0
—
-1
-29
Impairments (-) and reversals of impairments (+)
103
—
—
—
—
103
Historical cost on Dec 31, 2023
3,952
532
13
1
3
4,500
Carrying value on Dec 31, 2023
3,952
532
13
1
3
4,500
Carrying value on Jan 1, 2023
3,877
127
13
1
3
4,021
Impairment reversal of EUR 130 million (2023: EUR 130 million) of subsidiary shares in
2024 relates to the Outokumpu Holding Nederland B.V.
Disposal and decreases of EUR 49 million of subsidiary shares in 2024 relates to capital
return of EUR 46 million from Outokumpu Holding Nederland B.V. and EUR 3 million from
Outokumpu Stainless Holding GmbH (2023: EUR 28 million capital return from Outokumpu
Stainless Holding GmbH).
Shareholdings in Group companies on December 31, 2024
The principal subsidiaries are listed in consolidated Financial Statements note 6.5.
Outokumpu Annual Report 2024
237
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
12. Financial instruments to market risks
The financial risk management of Outokumpu Group has been centralized to Outokumpu
Corporation’s Treasury and risk management function (“Treasury”). The Group’s
management of financial risks has been described in consolidated Financial Statements, in
note section 5.
Outokumpu Corporation raises most of the Group’s debt and is mainly responsible for
arranging the internal funding. Interest rate risk management has also been centralized to
Outokumpu Corporation. Treasury is responsible for developing and maintaining the Group’s
bank account structure. The efficient payment processes and liquidity management of the
Group are enabled by bank account arrangements.
Subsidiaries hedge the foreign exchange and commodity risks with Treasury. Treasury
makes the derivative agreements with banks and other financial institutions according to
Treasury Policy. Outokumpu Corporation follows the price risk of emission allowances of the
Group and makes, when necessary, the emission trades with subsidiaries and with external
counterparties. The price risk of energy is followed centrally in Outokumpu Group according
to Energy Procurement policy and the Group’s price risk of energy can be hedged with
derivatives according to Treasury Policy.
Sensitivity of financial instruments to market risks
2024
2023
€ million
In profit or loss
In profit or loss
+/-10% change in EUR/USD exchange rate
+0/-0
+0/-0
+/-10% change in EUR/SEK exchange rate
-0/+0
-0/+0
+/-1% parallel shift in interest rates
-0/+0
-1/+1
Foreign exchange position
2024
2023
€ million
SEK
USD
GBP
Other
SEK
USD
GBP
Other
Trade receivables and payables
-5
3
-1
0
-5
5
0
0
Loans and bank accounts
151
-865
-61
4
87
-794
-47
1
Derivatives
-145
862
61
-3
-81
787
47
-1
Net position
2
-1
-1
0
1
-2
0
0
The sensitivity analyses apply to financial instruments only. Other assets, liabilities and off-balance sheet items such as net pension liabilities, sales and purchase orders, are not in the scope of these analyses. The
calculations are net of tax.
Outokumpu Annual Report 2024
238
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
13. Derivative instruments
2024
2023
2024
2023
€ million
Positive
fair value
Negative
fair value
Net fair
value
Net fair
value
Nominal
amounts
Nominal
amounts
Currency and interest rate
derivatives
Currency forwards with financial
institutions
18
-4
14
-17
2,013
1,972
Currency forwards with
subsidiaries
4
-6
-2
-4
883
1,070
Interest rate swap with
financial institutions
—
-2
-2
-7
125
125
Tonnes
Tonnes
Metal derivatives
Forward nickel contracts with
financial institutions
17
-11
6
9
25,576
33,543
Forward nickel contracts with
subsidiaries
12
-18
-6
-9
27,284
37,401
Gas derivatives
MWh
MWh
Forward gas contracts with
financial institutions
4
0
4
—
917,408
—
Forward gas contracts with
subsidiaries
0
-4
-4
—
917,408
—
Total derivatives
55
-46
10
-28
Less long-term derivatives
Currency forwards with
subsidiaries
—
—
—
0
Interest rate swaps with
financial institutions
—
—
—
-7
Forward nickel contacts with
financial institutions
0
0
0
-1
Forward nickel contracts with
subsidiaries
0
0
0
1
Forward gas contracts with
financial institutions
1
0
1
—
Forward gas contracts with
subsidiaries
0
-1
-1
—
Short-term derivatives
54
-44
10
-21
All derivatives have been classified to hierarchy level 2.
14. Receivables
€ million
From subsidiaries
From others
Total
Current receivables
2024
Loans receivable
230
—
230
Receivables from group companies
22
—
22
Trade receivable
60
0
60
Prepaid expenses and accrued income
3
12
15
Other receivables
63
39
102
378
50
428
2023
Loans receivable
80
—
80
Trade receivables
74
6
80
Prepaid expenses and accrued income
4
22
25
Other receivables
41
34
75
199
61
260
€ million
2024
2023
Prepaid expenses and accrued income
Prepaid credit fees and commitment fees
2
2
Prepaid interest expenses and accrued interest income
3
4
Other
10
19
15
25
Outokumpu Annual Report 2024
239
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
15. Shareholders’ equity
€ million
2024
2023
Share capital on Jan 1 and Dec 31
311
311
Premium fund on Jan and Dec 31
720
720
Invested unrestricted equity reserve on Jan 1
2,220
2,290
Treasury share purchase
-34
-70
Invested unrestricted equity reserve on Dec 31
2,186
2,220
Retained earnings on Jan 1
294
160
Previous year’s result
75
286
Dividends paid
-110
-152
Retained earnings on Dec 31
259
294
Result for the financial year
110
75
Total shareholders’ equity on Dec 31
3,587
3,621
Distributable funds on Dec 31
Retained earnings
259
294
Result for the financial year
110
75
Invested unrestricted equity reserve
2,186
2,220
Distributable funds on Dec 31
2,555
2,589
16. Liabilities
€ million
Interest rate, %
2024
2023
Outstanding amount
Convertible bonds
2020 fixed rate bond maturing on July 9, 2025
5.0
125
125
€ million
To subsidiaries
To others
Total
Current liabilities
2024
Group bank account liabilities
861
—
861
Other current loans
565
—
565
Convertible bonds
—
125
125
Commercial papers
—
79
79
Trade payables
6
80
86
Accrued expenses and prepaid income
2
10
13
Other current liabilities
28
23
51
1,462
318
1,780
2023
Group bank account liabilities
978
—
978
Other current loans
398
—
398
Trade payables
7
81
88
Accrued expenses and prepaid income
4
13
17
Other current liabilities
43
46
89
1,430
140
1,570
€ million
2024
2023
Accrued expenses and prepaid income
Accrued interest expenses and prepaid interest income
8
8
Accrued employee-related expenses
4
6
Other
1
3
13
17
Outokumpu Annual Report 2024
240
Annual review
Financial year 2024
Review by the Board of Directors
Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
17. Commitments and contingent liabilities
€ million
2024
2023
Other pledges on Dec 31
13
13
Guarantees on Dec 31
On behalf of subsidiaries
For financing
188
256
For commercial guarantees
0
0
For other commitments
33
50
Other commitments for financing on Dec 31
4
2
238
321
Outokumpu is liable for its associated company Manga LNG Oy’s certain liabilities
amounting to EUR 9 million at the end of the reporting period (December 31, 2023: EUR
12 million). In the table above, this commitment is reported as other pledges (Outokumpu’s
shares in Manga LNG Oy).
Outokumpu Corporation is, in relation to its shareholding in EPV Energia Oy, liable for the
costs, commitments and liabilities relating to electricity provided by Tornion Voima Oy.
These commitments are reported under other commitments for financing.
Contingent liabilities
Outokumpu is a minority shareholder in its associated company Voimaosakeyhtiö SF, which
is the majority shareholder of Fennovoima Oy. There is a pending arbitration between
Fennovoima Oy and Rosatom entities related to the termination of the EPC (Engineering,
Procurement and Construction) contract for a nuclear power plant. Outokumpu Corporation
is not a party in the said dispute.
Originally, Outokumpu’s commitment to Voimaosakeyhtiö SF for participation in the planned
nuclear power plant project amounted to approximately EUR 250 million, of which EUR 117
million has been paid. Further payments related to the original commitment, if any, are not
expected to occur.
Minimum future lease payments on leases on Dec 31
€ million
2024
2023
Not later than 1 year
1
1
Later than 1 year
2
3
3
4
18. Events after balance sheet date
See note 6.8 of the consolidated Financial Statements. Fennovoima, new member of the
Outokumpu Leadership Team, financial reporting schedule and change to the proposals of
the Shareholders' Nomination Board to the Annual General Meeting 2025 are related to
events after the balance sheet date of the parent company.
Outokumpu Annual Report 2024
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Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Signatures of the Review by the Board of Directors and Financial Statements
We hereby state that
1) the Financial Statements prepared in compliance with the applicable accounting regulation give a true and fair view of the assets, obligations, financial position and profit or loss of both
the company and the consolidated Financial Statements;
2) the report by the board of directors includes a description that gives a truthful picture of the development and results of the business of the company and the group, and a description of
the most significant risks and uncertainties as well as other state of the company; and
3) the sustainability report included in the report by the board of directors has been prepared in compliance with the reporting standards referred to in Chapter 7 of the accounting act and
Article 8 of the taxonomy regulation.
Helsinki, February 17, 2025
Kari Jordan
Chairman
Heinz Jörg Fuhrmann
Päivi Luostarinen
Member
Member
Jyrki Mäki-Kala
Karl-Petter Söderström
Member
Member
Pierre Vareille
Julia Woodhouse
Member
Member
Kati ter Horst
CEO
Auditor signature
Our auditor´s report has been issued today.
Helsinki, March 3, 2025
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (KHT)
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Financial year 2024
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Sustainability Statement
Financial Statements
Consolidated financial statements, IFRS
Notes to the consolidated financial statements
Parent company financial statements, FAS
Auditor's Report and Assurance Report
Governance and remuneration
Audit
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Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Auditor’s Report
(Translation of the Finnish Original)
Report on the Audit of the Financial Statements
To the Annual General Meeting of Outokumpu Oyj
Opinion
In our opinion
•
the consolidated financial statements give a true and fair view of the group’s financial
position, financial performance and cash flows in accordance with IFRS Accounting
Standards as adopted by the EU
•
the financial statements give a true and fair view of the parent company’s financial
performance and financial position in accordance with the laws and regulations
governing the preparation of financial statements in Finland and comply with statutory
requirements.
Our opinion is consistent with the additional report to the Audit Committee.
What we have audited
We have audited the financial statements of Outokumpu Oyj (business identity code
0215254-2) for the year ended 31 December 2024. The financial statements comprise:
•
the consolidated statement of income, consolidated statement of comprehensive
income, consolidated statement of financial position, consolidated statement of cash
flows, consolidated statement of changes in equity and notes to the consolidated
financial statements, which include material accounting policy information and other
explanatory information
•
the income statement of the parent company, balance sheet of the parent company,
cash flow statement of the parent company and notes to the parent company financial
statements.
Basis for Opinion
We conducted our audit in accordance with good auditing practice in Finland. Our
responsibilities under good auditing practice are further described in the Auditor’s
Responsibilities for the Audit of the Financial Statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Independence
We are independent of the parent company and of the group companies in accordance with
the ethical requirements that are applicable in Finland and are relevant to our audit, and
we have fulfilled our other ethical responsibilities in accordance with these requirements.
To the best of our knowledge and belief, the non-audit services that we have provided to
the parent company and group companies are in accordance with the applicable law and
regulations in Finland and we have not provided non-audit services that are prohibited
under Article 5(1) of Regulation (EU) No 537/2014. The non-audit services that we have
provided are disclosed in note 2.3 to the Financial Statements.
Our Audit Approach
Overview
Materiality
•
Overall group materiality: € 35 million
Audit scope
•
The audit scope includes parent company, and most
significant other companies, covering the vast majority of
sales, assets and liabilities.
Key Audit Matters
•
Valuation of goodwill
•
Valuation of Property, Plant and Equipment
•
Valuation of inventories
•
System environment and internal controls
•
Valuation of subsidiary shares in the parent company’s
financial statements
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Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
As part of designing our audit, we determined materiality and assessed the risks of material
misstatement in the financial statements. In particular, we considered where management
made subjective judgements; for example, in respect of significant accounting estimates
that involved making assumptions and considering future events that are inherently
uncertain.
Materiality
The scope of our audit was influenced by our application of materiality. An audit is designed
to obtain reasonable assurance whether the financial statements are free from material
misstatement. Misstatements may arise due to fraud or error. They are considered material
if individually or in aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for
materiality, including the overall group materiality for the consolidated financial statements
as set out in the table below. These, together with qualitative considerations, helped us to
determine the scope of our audit and the nature, timing and extent of our audit procedures
and to evaluate the effect of misstatements on the financial statements as a whole.
Overall group materiality
€ 35 million
How we determined it
Based on 2024 sales
Rationale for the
materiality benchmark
applied
We chose sales as the benchmark because, in our view, it is
a stable and an important benchmark in the group’s current
situation, against which the performance of the group is
measured by users of the financial statements.
How we tailored our group audit scope
We tailored the scope of our audit, taking into account the structure of the Outokumpu
group, the accounting processes and controls, and the industry in which the group
operates. The group audit scope was focused on the manufacturing companies in Finland,
Sweden, Germany, USA, Mexico, the UK and Italy. We obtained, through our audit
procedures at the aforementioned companies, combined with additional procedures at the
group level, sufficient and appropriate evidence regarding the financial information of the
group as a whole to provide a basis for our opinion on the consolidated financial
statements.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most
significance in our audit of the financial statements of the current period. These matters
were addressed in the context of our audit of the financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.
As in all of our audits, we also addressed the risk of management override of internal
controls, including among other matters consideration of whether there was evidence of
bias that represented a risk of material misstatement due to fraud.
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Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Key audit matter in the audit of the group
How our audit addressed the key audit matter
Valuation of goodwill
Refer to notes 4.1 and 4.3 in the consolidated
financial statements.
As at 31 December 2024 the group’s
goodwill balance amounted to € 457
million.
Goodwill is tested at least annually,
irrespective of whether there is any
indication of impairment.
In goodwill impairment testing, the
recoverable amounts are based on value in
use determined by discounted future net
cash flows expected to be generated by the
cash-generating unit.
Key assumptions of the value-in-use
calculations include the discount rate, the
terminal value growth rate, the average
global growth in end-use consumption of
stainless steel and base price development,
delivery volume and capital expenditure
development, and cost savings related to
on-going strategy-implementation related
initiatives.
Valuation of goodwill is a key audit matter
due to the size of the goodwill balance and
the level of management judgement
involved in the estimation process.
Our audit of goodwill valuation focused on
management’s judgement and estimates
used. We assessed the appropriateness of
these through the following procedures:
•
We tested the methodology applied in
the value in use calculation by comparing
it to the requirements of IAS 36,
Impairment of Assets, and we tested the
mathematical accuracy of the
calculations.
•
We evaluated the process by which the
future cash flow forecasts were drawn up,
including comparing them to medium
term strategic plans and forecasts
approved by the Board and testing the
key underlying assumptions.
•
We considered whether the sensitivity
analysis performed by management
around key drivers of the cash flow
forecast was appropriate by considering
the likelihood of the movements of these
key assumptions.
•
We compared the current year actual
results to those included as estimates in
the prior year impairment model to
corroborate the reliability of
management’s estimates.
•
The discount rates applied within the
model were assessed by PwC valuation
specialists, including comparison to
economic and industry forecasts as
appropriate.
We also considered the appropriateness of
the related disclosures provided in notes
4.1 and 4.3 in the group financial
statements.
Key audit matter in the audit of the group
How our audit addressed the key audit matter
Valuation of Property, Plant and Equipment
Refer to note 4.1 in the consolidated financial
statements.
As at 31 December 2024 the group’s
Property, Plant and Equipment (PPE)
amounted to € 1,935 million.
Carrying amounts of property, plant and
equipment are regularly reviewed for
impairment indicators and tested if needed.
Impairment testing requires estimations of
future cash flows attributable to the asset
and related valuation parameters.
Valuation of Property, Plant and Equipment
is a key audit matter due to the size of the
balance and the level of management
judgement involved in the estimation
process.
We assessed the appropriateness of the
group’s method and management’s
judgement and estimates in the impairment
calculations for Property, Plant and
Equipment.
We performed substantive audit procedures
including e.g. testing of assets acquired,
disposals and scrapings in the year and
depreciation of the fixed assets mainly
through analytical audit procedures.
Our audit work also included testing the
operating effectiveness of controls in place
to ensure the appropriate valuation of
Property, Plant and Equipment.
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Auditor's Report and Assurance Report
Governance and remuneration
Key audit matter in the audit of the group
How our audit addressed the key audit matter
Valuation of Inventories
Refer to note 4.4 in the consolidated financial
statements.
As at 31 December 2024 the group’s
inventories amounted to € 1,764 million.
Inventories are stated at the lower of cost
and net realizable value (NRV). Net
realizable value is the estimated selling
price in the ordinary course of business,
less the estimated costs of completion and
the estimated costs attributable to the sale.
Calculation of net realizable value requires
estimates on sales prices for products to be
sold in the future. Due to fluctuations in
nickel and other alloy prices, the realized
prices can deviate significantly from the
estimates used in calculation of net
realizable value.
Due to the level of management judgement
and the significant carrying amounts, this is
one of the key audit matters.
Our audit work included testing controls in
place to ensure proper valuation of
inventories.
In addition, our audit procedures included,
among other things, the following:
•
We performed tests over the prices of
raw materials and verified items in the
product costing of work in progress.
•
We performed tests over the NRV
calculations and the assumptions used.
•
We assessed the adequacy of the
obsolescence provision and the
management judgement used.
Key audit matter in the audit of the group
How our audit addressed the key audit matter
System environment and internal controls
The group has a fragmented system
environment with a strong focus on
continuously developing its system
environment, e.g. platform transformation,
upgrading and implementing new systems.
However, the fragmented system
environment introduces risks related to
system access and change management,
and we have accordingly designated this as
a key audit matter.
We tested the group’s controls around
access and change management related to
the key IT systems.
We performed tests of details to reduce the
related risks of material misstatement to an
acceptably low level. We tested the group’s
controls related to the platform
transformation, new system implementation
and system upgrade. We also tested the
completeness and accuracy of data
migrations relevant for financial reporting.
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Sustainability Statement
Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Key audit matter in the audit of the parent company
How our audit addressed the key audit matter
Valuation of subsidiary shares in the parent
company’s financial statements
As at 31 December 2024 the value of
Outokumpu Oyj’s subsidiary shares
amounted to € 4,033 million in the parent
company’s financial statements.
The valuation of subsidiary shares is tested
as part of the group impairment testing
based on the discounted cash flow model.
The valuation of subsidiary shares in the
parent company’s financial statements is a
key audit matter due to the significant
carrying amounts involved and the
management judgement involved.
We assessed the appropriateness of the
method and management’s judgement and
estimates in the calculations through the
following procedures:
•
We evaluated the process by which the
future cash flow forecasts were drawn up,
including comparing them to medium
term strategic plans and forecasts
approved by the Board and testing the
key underlying assumptions.
•
We considered whether the sensitivity
analysis performed by management
around key drivers of the cash flow
forecast was appropriate by considering
the likelihood of the movements of these
key assumptions.
•
We compared the current year actual
results included in the prior year
impairment model to corroborate the
reliability of management’s estimates.
•
The discount rates applied within the
model were assessed by PwC valuation
specialists, including comparison to
economic and industry forecasts as
appropriate.
There are no significant risks of material misstatement referred to in Article 10(2c) of
Regulation (EU) No 537/2014 with respect to the consolidated financial statements or
the parent company financial statements.
Responsibilities of the Board of Directors and the Managing Director
for the Financial Statements
The Board of Directors and the Managing Director are responsible for the preparation of
consolidated financial statements that give a true and fair view in accordance with IFRS
Accounting Standards as adopted by the EU, and of financial statements that give a true
and fair view in accordance with the laws and regulations governing the preparation of
financial statements in Finland and comply with statutory requirements. The Board of
Directors and the Managing Director are also responsible for such internal control as they
determine is necessary to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors and the Managing Director are
responsible for assessing the parent company’s and the group’s ability to continue as a
going concern, disclosing, as applicable, matters relating to going concern and using the
going concern basis of accounting. The financial statements are prepared using the going
concern basis of accounting unless there is an intention to liquidate the parent company or
the group or to cease operations, or there is no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements
as a whole are free from material misstatement, whether due to fraud or error, and to issue
an auditor’s report that includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in accordance with good
auditing practice will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.
As part of an audit in accordance with good auditing practice, we exercise professional
judgment and maintain professional skepticism throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those
risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for
our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.
•
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the parent company’s or the group’s
internal control.
•
Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
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Auditor's Report and Assurance Report
Governance and remuneration
•
Conclude on the appropriateness of the Board of Directors’ and the Managing Director’s
use of the going concern basis of accounting and based on the audit evidence obtained,
whether a material uncertainty exists related to events or conditions that may cast
significant doubt on the parent company’s or the group’s ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw
attention in our auditor’s report to the related disclosures in the financial statements or,
if such disclosures are inadequate, to modify our opinion. Our conclusions are based on
the audit evidence obtained up to the date of our auditor’s report. However, future
events or conditions may cause the parent company or the group to cease to continue
as a going concern.
•
Evaluate the overall presentation, structure and content of the financial statements,
including the disclosures, and whether the financial statements represent the underlying
transactions and events so that the financial statements give a true and fair view.
•
Plan and perform the group audit to obtain sufficient appropriate audit evidence
regarding the financial information of the entities or business units within the group as a
basis for forming an opinion on the group financial statements. We are responsible for
the direction, supervision and review of the audit work performed for purposes of the
group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the
planned scope and timing of the audit and significant audit findings, including any
significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied
with relevant ethical requirements regarding independence, and to communicate with them
all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those
matters that were of most significance in the audit of the financial statements of the
current period and are therefore the key audit matters. We describe these matters in our
auditor’s report unless law or regulation precludes public disclosure about the matter or
when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
Other Reporting Requirements
Appointment
We were first appointed as auditors by the annual general meeting on 21 March 2017.
Other Information
The Board of Directors and the Managing Director are responsible for the other information.
The other information comprises the report of the Board of Directors and the information
included in the Annual Report, but does not include the financial statements or our
auditor’s report thereon. We have obtained the report of the Board of Directors prior to the
date of this auditor’s report and the Annual Report is expected to be made available to us
after that date.
Our opinion on the financial statements does not cover the other information.
In connection with our audit of the financial statements, our responsibility is to read the
other information identified above and, in doing so, consider whether the other information
is materially inconsistent with the financial statements or our knowledge obtained in the
audit, or otherwise appears to be materially misstated. With respect to the report of the
Board of Directors, our responsibility also includes considering whether the report of the
Board of Directors has been prepared in compliance with the applicable provisions,
excluding the sustainability report information on which there are provisions in Chapter 7 of
the Accounting Act and in the sustainability reporting standards.
In our opinion, the information in the report of the Board of Directors is consistent with the
information in the financial statements and the report of the Board of Directors has been
prepared in compliance with the applicable provisions. Our opinion does not cover the
sustainability report information on which there are provisions in Chapter 7 of the
Accounting Act and in the sustainability reporting standards.
If, based on the work we have performed on the other information that we obtained prior to
the date of this auditor’s report, we conclude that there is a material misstatement of this
other information, we are required to report that fact. We have nothing to report in this
regard.
Other statements
The proposal by the Board of Directors regarding the distribution of profits is in compliance
with the Limited Liability Companies Act. We support that the Board of Directors and the
Managing Director of the parent company should be discharged from liability for the
financial period audited by us.
Helsinki, March 3, 2025
PricewaterhouseCoopers Oy
Authorised Public Accountants
Samuli Perälä
Authorised Public Accountant (KHT)
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Assurance Report on the Sustainability Report
(Translation of the Finnish Original)
To the Annual General Meeting of Outokumpu Oyj
We have performed a limited assurance engagement on the group sustainability report of
Outokumpu Oyj (business identity code (0215254-2) that is referred to in Chapter 7 of the
Accounting Act and that is included in the report of the Board of Directors for the reporting
period 1.1.–31.12.2024.
Opinion
Based on the procedures we have performed and the evidence we have obtained, nothing
has come to our attention that causes us to believe that the group sustainability report
does not comply, in all material respects, with
1) the requirements laid down in Chapter 7 of the Accounting Act and the sustainability
reporting standards (ESRS);
2) the requirements laid down in Article 8 of the Regulation (EU) 2020/852 of the
European Parliament and of the Council on the establishment of a framework to
facilitate sustainable investment, and amending Regulation (EU) 2019/2088 (EU
Taxonomy).
Point 1 above also contains the process in which Outokumpu Oyj has identified the
information for reporting in accordance with the sustainability reporting standards (double
materiality assessment).
Our opinion does not cover the tagging of the group sustainability report in accordance with
Chapter 7, Section 22, of the Accounting Act, because sustainability reporting companies
have not had the possibility to comply with that requirement in the absence of the ESEF
regulation or other European Union legislation.
Basis for Opinion
We performed the assurance of the group sustainability report as a limited assurance
engagement in compliance with good assurance practice in Finland and with the
International Standard on Assurance Engagements (ISAE) 3000 (Revised) Assurance
Engagements Other than Audits or Reviews of Historical Financial Information.
Our responsibilities under this standard are further described in the Responsibilities of the
Authorised Group Sustainability Auditor section of our report.
We believe that the evidence we have obtained is sufficient and appropriate to provide a
basis for our opinion.
Authorised Group Sustainability Auditor's Independence and Quality
Management
We are independent of the parent company and of the group companies in accordance with
the ethical requirements that are applicable in Finland and are relevant to our engagement,
and we have fulfilled our other ethical responsibilities in accordance with these
requirements.
Our firm applies International Standard on Quality Management ISQM 1, which requires the
firm to design, implement and operate a system of quality management including policies
or procedures regarding compliance with ethical requirements, professional standards and
applicable legal and regulatory requirements.
Responsibilities of the Board of Directors and the Managing Director
The Board of Directors and the Managing Director of Outokumpu Oyj are responsible for:
•
the group sustainability report and for its preparation and presentation in accordance
with the provisions of Chapter 7 of the Accounting Act, including the process that has
been defined in the sustainability reporting standards and in which the information for
reporting in accordance with the sustainability reporting standards has been identified
•
the compliance of the group sustainability report with the requirements laid down in
Article 8 of the Regulation (EU) 2020/852 of the European Parliament and of the
Council on the establishment of a framework to facilitate sustainable investment, and
amending Regulation (EU) 2019/2088;
•
such internal control as the Board of Directors and the Managing Director determines is
necessary to enable the preparation of a group sustainability report that is free from
material misstatement, whether due to fraud or error.
Inherent Limitations in the Preparation of a Sustainability Report
In reporting forward-looking information in accordance with ESRS, management of the
Company is required to prepare the forward-looking information on the basis of
assumptions that have been disclosed in the sustainability report about events that may
occur in the future and possible future actions by the Group. Actual outcomes are likely to
be different since anticipated events frequently do not occur as expected.
Responsibilities of the Authorised Group Sustainability Auditor
Our responsibility is to perform an assurance engagement to obtain limited assurance
about whether the group sustainability report is free from material misstatement, whether
due to fraud or error, and to issue a limited assurance report that includes our opinion.
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Governance and remuneration
Misstatements can arise from fraud or error and are considered material if, individually or
in the aggregate, they could reasonably be expected to influence the decisions of users
taken on the basis of the group sustainability report.
Compliance with the International Standard on Assurance Engagements (ISAE) 3000
(Revised) requires that we exercise professional judgment and maintain professional
skepticism throughout the engagement. We also:
•
Identify and assess the risks of material misstatement of the group sustainability report,
whether due to fraud or error, and obtain an understanding of internal control relevant to
the engagement in order to design assurance procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of
the parent company’s or the group’s internal control.
•
Design and perform assurance procedures responsive to those risks to obtain evidence
that is sufficient and appropriate to provide a basis for our opinion. The risk of not
detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
Description of the Procedures That Have Been Performed
The procedures performed in a limited assurance engagement vary in nature and timing
from, and are less in extent than for, a reasonable assurance engagement. The nature,
timing and extent of assurance procedures selected depend on professional judgment,
including the assessment of risks of material misstatement, whether due to fraud or error.
Consequently, the level of assurance obtained in a limited assurance engagement is
substantially lower than the assurance that would have been obtained had a reasonable
assurance engagement been performed.
Our procedures included for example the following:
•
We interviewed the company's management and the individuals responsible for
collecting and reporting the information contained in the group sustainability report at
the group level and in subsidiaries to gain an understanding of the sustainability
reporting process and the related internal controls and information systems.
•
We familiarised ourselves with the background documentation and records prepared by
the company where applicable, and assessed whether they support the information
contained in the group sustainability report.
•
We performed site visits at the company’s sites in Kemi and Tornio in Finland and
interviewed persons responsible for the reporting process in Krefeld in Germany.
•
We assessed the company's double materiality assessment process in relation to the
requirements of the ESRS standards, as well as whether the information provided about
the assessment process complies with the ESRS standards.
•
We assessed whether the sustainability information contained in the group sustainability
report complies with the ESRS standards.
•
Regarding the EU taxonomy information, we gained an understanding of the process by
which the company has identified the group's taxonomy-eligible and taxonomy-aligned
economic activities, and we assessed the compliance of the information provided with
the regulations.
Helsinki, March 3, 2025
PricewaterhouseCoopers Oy
Authorised Sustainability Auditors
Tiina Puukkoniemi
Authorised Sustainability Auditor
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Financial Statements
Auditor's Report and Assurance Report
Governance and remuneration
Governance and
remuneration
This section contains Outokumpu’s
Corporate Governance Statement,
Remuneration Report as well as
additional information on risk
management and for investors.
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Corporate Governance Statement 2024
Outokumpu Corporation complies with the laws and regulations applicable to a Finnish public company and
the company’s Articles of Association.
Outokumpu Annual Report 2024
253
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Regulatory and structural framework
Outokumpu Corporation, (the “Company” or “Outokumpu”), the Group’s parent company, is
a public limited liability company, listed on Nasdaq Helsinki and incorporated and
domiciled in Finland. Its headquarters are located in Helsinki. In its corporate governance
and management, Outokumpu Oyj complies with the laws and regulations applicable to a
Finnish public company and the Company’s Articles of Association.
Outokumpu follows the Finnish Corporate Governance Code, effective as of January 1,
2025. The Finnish Corporate Governance Code is issued by the Finnish Securities Market
Association and adopted by Nasdaq Helsinki Ltd.
In all activities of the Group, the Outokumpu Code of Conduct sets out the ethical
standards and provides guidelines for a common way of working within the Group.
The Company has further implemented a broad set of Group-wide policies that govern
various areas of the Group’s operations.
The governing bodies of Outokumpu Corporation, i.e., the General Meeting of Shareholders,
the Board of Directors, and the President and Chief Executive Officer (the “CEO”), have the
ultimate responsibility for the management and operations of the Outokumpu Group.
The latest Corporate Governance Statement and other updated corporate governance
information can be found on the Group’s Corporate Governance website.
In accordance with the Finnish Companies Act, the General Meeting of Shareholders is the
highest decision-making body of the company. The Companies Act and Outokumpu’s
Articles of Association provide that certain important decisions, such as amendments to
the Articles of Association, adoption of the financial statements, authorization for the
issuance of shares, decisions on dividends, and the election of the Board of Directors
(including the Chairman and the Vice Chairman), the auditor and the sustainability
reporting assurance provider, as well as discharge from liability to the members of the
Board of Directors and the CEO, are the exclusive domain of the General Meeting of
Shareholders. In addition, the Annual General Meeting makes advisory resolutions on the
Remuneration Policy and the Remuneration Report.
Outokumpu Annual Report 2024
254
Outokumpu Corporation’s
Annual General Meeting
2024 was arranged in
April 2024 at the Clarion
hotel in Helsinki, Finland.
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Board of Directors
Composition and operations of the Board of Directors December 31, 2024
All Board members are independent of the company. The CVs of the Board of Directors are also available at our webpages.
Kari Jordan
Chairman of the Board of Directors
b. 1956, Finnish citizen, male
M.Sc. (Econ.), Vuorineuvos (Finnish honorary title)
Outokumpu Board member 2018–
Chairman of the Board 2018–
Chairman of the Remuneration Committee
Independent of the company and its significant shareholders.
Work experience
CEO: Metsäliitto Cooperative 2004–2017
President and CEO: Metsä Group 2006–2018
Chairman: Metsä Board Corporation 2005–2018
Chairman: Metsä Fibre Oy 2006–2017
Chairman: Metsä Tissue Corporation 2004–2017
Executive Vice President and Member of the Group Executive Management: Nordea AB and
predecessors 1994–2004
Member of the Board of Management: OKOBANK 1987–1994
Vice President: Citicorp Investment Bank Ltd 1986–1987
Several management positions: Citibank Plc 1981–1986
Positions of trust
Chairman of the Board of Directors (March 2023–) and member of the Board of Directors
(2022–2023): Stora Enso
Vice Chairman of the Board of Directors: Nordea Bank Abp 2019–March 2022
Chairman of the Supervisory Board: Varma Mutual Pension Insurance Company 2015–2019
Vice Chairman of the Board: Nokian Tyres Plc 2018–2021
Chairman of the Board: Finland Chamber of Commerce 2012–2016
Chairman of the Board: Finnish Forest Industries Federation 2009–2011
Vice Chairman of the Board: Confederation of Finnish Industries (EK) 2009–2011, 2013–2014
Chairman of the Board: Finnish Bankers’ Association 2002–2004
Mr. Jordan holds several positions of trust in foundations and non-profit associations.
Heinz Jörg Fuhrmann
Member of the Board of Directors
b. 1956, German citizen, male
PhD, Metallurgy, University of Berlin; Master's Degree,
Metallurgy, RWTH Aachen University; Honorary Professor,
RWTH Aachen University, Germany
Outokumpu Board member 2021–
Member of the Remuneration Committee
Independent of the company and its significant shareholders.
Work experience
Chief Executive Officer: Salzgitter AG 2011–2021
Vice Chairman, Executive Board: Salzgitter AG 2007–2011
Chief Financial Officer: Salzgitter AG 2001–2011
Executive Board Member: Salzgitter AG and Preussag Stahl AG 1996–2001
General Representative, Head of Central Corporate Planning: Preussag Stahl AG 1995–1996
Several management positions: Klöckner-Werke AG 1983–1995
Scientist: Betriebsforschungsinstitut Düsseldorf 1980–1983
Positions of trust
Chairman of the Supervisory Board: Günter Papenburg AG (privately held) 2023–
Chairman of the Supervisory Board: Max Aicher Stahl AG (privately held) 2023–
Member of the Supervisory Board: H2APEX Group SCA 2024–
Member of the EIB Group Climate and Environment Advisory Council: 2021–
Member of the German Hydrogen Council 2020–2021
Chairman of the German Steel Industry Employers’ Association 2020–2023
Member of the Presidential Board: Federation of German Industries (BDI) 2018–2021
Member (2014–2016) and Chairman of the Senate: Fraunhofer Society 2016–2022
Chairman/member of the Supervisory Board: Aurubis AG 2009–2021
Member of the Supervisory Board: TÜV Nord AG 2008–2023
Member of the Supervisory Board: Öffentliche Versicherung Braunschweig
(Insurance) 2002–2022
Outokumpu Annual Report 2024
255
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Päivi Luostarinen
Member of the Board of Directors
b. 1955, Finnish citizen, female
LL.M. University of Helsinki, Finland
Outokumpu Board member 2021–
Member of the Audit Committee
Independent of the company and its significant shareholders.
Work experience
Ambassador of Finland: London 2015–2019
Ambassador of Finland: Berlin 2011–2015
Director General, Europe: Ministry for Foreign Affairs of Finland 2008–2011
Deputy Director General, Americas and Asia: Ministry for Foreign Affairs 2007–2008
Chief Policy Adviser, Team Lead of Trade Policy and International Relations: Confederation of
Finnish Industries (EK) 2005–2006
Director General, Americas and Asia: Ministry for Foreign Affairs 2003–2005
Deputy Director General, Americas and Asia: Ministry for Foreign Affairs 2002–2003
Deputy Director General, Trade Policy and Economic Cooperation: Ministry for Foreign Affairs
2000–2001
Deputy Director General, the EU Secretariat: Ministry for Foreign Affairs 1996–2000
Member of the Cabinet of the Finnish Commissioner: EU Commission, Brussels 1995–1996
Positions of trust
Ambassador for Climate Change: Ministry for Foreign Affairs 06/2019–09/2019
Member: Finnish High Court of Impeachment 2012–2015
Member of the Board: Finnish Institute of International Affairs 2010–2014
Member of the Supervisory Board: Finnfund 2005–2006
Member of the Board 2002 and deputy member 2000–2001, 2003–2005 and 2007–2009:
Finnfund
Ms. Luostarinen has in addition held several positions, starting in 1981, in the Foreign Service
in Helsinki, at the Permanent Mission of Finland to the UN in New York and at the Permanent
Delegation of Finland to the EU in Brussels.
Jyrki Mäki-Kala
Member of the Board of Directors
b. 1961, Finnish citizen, male
M.Sc. (Econ.), Vaasa, Finland
Outokumpu Board member 2023–
Chairman of the Audit Committee
Independent of the company and its significant shareholders.
Work experience
Chief Financial Officer: Neste Oyj 2013–2022
Chief Financial Officer: Kemira Oyj 2008–2013
Several managerial positions: Kemira Pulp and Paper 2005–2008
Several managerial positions: Nokia Chemicals/Finnish Chemicals (later Kemira Chemicals)
1988–2005
Positions of trust
Member of the Board of Directors: Orthex 2022–
Chairman of the Audit Committee: Anora (formerly Altia) 2020–
Chairman of the Board of Directors: Neste Marketing & Services 2017–2022
Member of the Board of Directors: Tesi (Finnish Industry Investment Ltd) 2019–2021
Member and Chairman of the Board of Directors: Nynas AB 2018–2021
Member of the Board of Directors: Pohjolan Voima 2008–2013
Member of the Board of Directors: FC Energia 1998–2005
Outokumpu Annual Report 2024
256
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Petter Söderström
Member of the Board of Directors
b. 1976, Finnish citizen, male
M. Sc. (Econ.), Hanken School of Economics
Outokumpu Board member 2022–
Member of the Audit Committee
Independent of the company.
Work experience
Investment Director and Member of the Management Team: Solidium Oy 2009–
Project Leader and Partner: Leimdörfer Finland Oy 2008–2009
Associate Director and Partner: Mandatum & Co Oy 2002–2008
Senior Associate: PricewaterhouseCoopers Oy 2000–2002
Positions of trust
Member of the Board of Directors and of the Remuneration Committee: TietoEVRY 2023–
Member of the Board of Directors and Member of the Audit Committee: Neles 2020–2021
Chairperson of the Nomination Board: Mandatum 2023–
Member of the Nomination Board: Anora 2021–
Member of the Nomination Board (2018–2020) and Chairperson of the Nomination Board:
TietoEVRY 2020–2023
Chairperson of the Nomination Board: Metso 2018–2020
Pierre Vareille
Member of the Board of Directors
b. 1957, French citizen, male, Knight of the Legion of Honour
in July 2003
M.Sc. (Ecole Centrale Paris),
BA (Econ.) (Sorbonne University) Degree in Controlling and
Finance (Institut de Contrôle de Gestion)
Outokumpu Board member 2018–
Member of the Remuneration Committee
Independent of the company and its significant shareholders.
Work experience
Chairman and CEO 2012–2013 and CEO 2013–2016: Constellium
Chairman of the Board and CEO: FCI SA 2008–2012
Chief Operating Officer: FCI SA 2007–2008
Group Chief Executive: Wagon Plc. 2004–2007
Senior EVP and President of the Aluminium Conversion Sector: Pechiney 2002–2004
EVP and President of the Exhaust Systems Business Group: Faurecia 1999–2002
Chairman and CEO: GFI Aerospace (now LISI Aerospace) 1995–1999
CEO of Group subsidiaries Cefival and Specitubes 1990–1995 and several operational and
staff positions 1982–1989: Vallourec Group
Positions of trust
Board member, member of the Audit and Risk Committee, of the Nomination Committee and
of the Remuneration Committee: London Metal Exchange (LME) 2023–
Board member: Tenneco 2022–
Vice Chairman of the Board and Lead Independent Director (2021–), Chairman of the
Nomination, Remuneration and Governance Committee: Vallourec Group
Chairman of the Board: Société Bic SA 2018–2021
Board member (2015–), member of the Audit Committee (2018–2019), of the Nomination
and Compensation Committee (2019–) and of the Strategic Committee (2021–): Verallia
Founder and Co-President: The Vareille Foundation 2014–
Member of the Strategic Committee: CentraleSupelec 2008–2022
Lead Director and Vice President of the Board: Société Bic SA 2016–2018
Board member and member of the Audit Committee: Société Bic SA 2009–2016
Board member: CentraleSupelec 2008–2019
Chairman: European Aluminium Association 2015–2016
President: Alumni Association of the Ecole Centrale 2011–2013
In addition, Mr. Vareille has been a Member of the Board of Directors of diverse organizations
such as the Advisory Board of the Confederation of British Industry, the European Committee
of the MEDEF (Confederation of the French Industry) and the GIFAS (French Aerospace
Industries Association).
Outokumpu Annual Report 2024
257
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Julia Woodhouse
Member of the Board of Directors
b. 1958, British citizen, female
BA (hons) History
Outokumpu Board member 2019–
Member of the Audit Committee
Member of the ESG Advisory Council 2021–
Independent of the company and its significant shareholders.
Work experience
Director, Global Chassis Purchasing, Ford Motor Company 2016–2018
Director, Global Power Train Components Purchasing, Ford Motor Company 2012–2016
Director, Ford of Europe Program Purchasing, Ford Motor Company 2005–2011
Director, Implementation Team (Volvo, JLR, Ford), Ford Motor Company 2004–2005
Director, Team Value Management, Strategy & Business Development, Ford Motor Company
2002–2003
Positions of trust
Independent board member, member of Audit Committee and Chair of Remuneration
Committee: Surface Transforms Plc 2021–
Independent non-executive board member, Standards & Regulation Board, member of global
Governance Review Steering Committee and Chair of senior executive recruitment panel:
Royal Institution of Chartered Surveyors 2020–2023
Member of the Advisory Board: Nexcel, a BP/Castrol automotive technology start-up company
2019–2020
Member of the Strategic Advisory Board: Ford/Michelin 2016– 2018
Ms. Woodhouse has undertaken several international leadership assignments including in
USA and Germany and served on various committees and operating boards, including Global
Diversity Committee. She chaired a Global Sourcing Council, incorporating sustainable
sourcing. She is also a charity trustee.
The Board assesses the independence of the Board members and records the outcome in
the Board minutes. All members of the Board of Directors were independent of the company
and its significant shareholders on December 31, 2024, excluding one Board member who
was independent of the Company but not of one of its major shareholders.
Outokumpu shares and share-based rights (parents or subsidiaries) owned by
each director and their controlled corporations on December 31, 2024
Board member
Number of shares
Kari Jordan
300,000
Heinz Jörg Fuhrmann
24,742
Päivi Luostarinen
25,127
Jyrki Mäki-Kala
29,741
Petter Söderström
19,411
Pierre Vareille
69,571
Julia Woodhouse
44,590
Total
513,182
Duties and authority of the Board of Directors
The general objective of the Board of Directors is to direct Outokumpu’s business and
strategies in a manner that secures a significant and sustained increase in the value of the
Company for its shareholders. To this end, the members of the Board are expected to act as
a resource and to offer their expertise and experience for the benefit of the Company. The
tasks and responsibilities of the Company’s Board of Directors are determined on the basis
of the Companies Act as well as other applicable legislation.
The Board of Directors has the general authority to decide and act in all matters not reserved
for other corporate governance bodies by law or under the provisions of the Company’s
Articles of Association. The general task of the Board of Directors is to organize and oversee
the Company’s management and operations and it has the duty at all times to act in the
best interest of the Company.
Outokumpu Annual Report 2024
258
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
The Board of Directors has established the rules of procedure that define its tasks and
operating principles in the Charter of the Board of Directors. The main duties of the Board of
Directors are as follows:
With respect to directing the company’s business and strategies:
•
Decide on Outokumpu’s strategy and the long-term targets of the Outokumpu Group (the
“Group”) and monitor their implementation;
• Decide on annual business plans and monitor their implementation;
• Decide on annual limits for the Group’s capital expenditure, monitor related
implementation, review performance and decide on changes;
• Decide on any major and strategically significant investments and monitor their
implementation;
• Decide on any major and strategically important business acquisitions and divestments
and monitor their implementation;
• Decide on the Group’s external financing and treasury matters; and
• Decide on any other commitments by any of the Group companies that are out of the
ordinary either in terms of value or nature, taking into account the size, structure, and
field of the Group’s operations.
With respect to organizing the company’s management and
operations:
•
Nominate and dismiss the CEO and his/her deputy, if any, monitor his/her performance
and decide on the CEO’s terms of service, including incentive schemes, on the basis of a
proposal made by the Board’s Remuneration Committee;
• Nominate and dismiss the members of the Outokumpu Leadership Team and to define
their areas of responsibility based on a proposal by the Board’s Remuneration Committee;
• Monitor the adequacy and allocation of the Group’s top management resources;
• Decide on any significant changes to the Group’s business organization;
• Decide on the Group’s ethical values and modes of activity;
• Ensure that policies outlining the principles of corporate governance are in place;
• Ensure that policies outlining the principles of managing the Company’s insider issues and
related party transactions are being observed;
• Ensure that the Company has guidelines for any other matters that the Board deems
necessary and that fall within the scope of the Board’s duties and authority.
With respect to the preparation of matters to be resolved by the
General Meetings of Shareholders:
•
Establish a dividend policy and issue a proposal to the Annual General Meeting on
dividend distribution;
• Make a proposal to the Annual General Meeting concerning the election of an external
auditor and auditing fees;
•
Make a proposal to the Annual General Meeting concerning the election of a sustainability
reporting assurance provider;
• Make proposals to the Annual General Meeting concerning the Company’s Remuneration
Policy and Remuneration Report; and
• Make other proposals to General Meetings of Shareholders.
With respect to internal control and risk management:
•
Discuss and approve interim reports, statements, and annual accounts;
•
Monitor significant risks related to the Group’s operations and the management of such
risks;
•
Ensure that adequate policies for risk management are in place;
•
Monitor financial position, liquidity, and debt maturity structure;
•
Monitor the Group’s control environment;
•
Monitor and assess how agreements and other legal acts between the Company and its
related parties meet the requirements of the ordinary course of business and arm’s length
terms; and
•
Reassess its activities on a regular basis.
In 2024, the Board of Directors assessed its ways of working and performance with support
from an external service provider. The assessment results were presented to the
Shareholders’ Nomination Board.
Composition of the Board of Directors
The Annual General Meeting elects the Chairman, Vice Chairman and other members of the
Board of Directors for a term expiring at the close of the following Annual General Meeting.
The entire Board of Directors is, therefore, elected at each Annual General Meeting. A Board
member may be removed from office at any time by a resolution passed by a General
Meeting of Shareholders. Proposals to the Annual General Meeting concerning the election of
Board members that have been made known to the Board of Directors prior to the Annual
General Meeting will be made public if such a proposal is supported by shareholders holding
a minimum of 10% of all the company’s shares and voting rights and the person being
proposed has consented to such nomination.
The General Meeting of Shareholders decides on the remuneration payable to the members
of the Board of Directors.
Under the company’s Articles of Association, the Board shall consist of no less than five and
no more than twelve members. A Board consisting of eight members was elected at the
Annual General Meeting 2024. Board meetings will be held as regularly as deemed
necessary, but at least five times every year. In 2024, the Board of Directors had 12
meetings, and the attendance rate was 98%.
Outokumpu Annual Report 2024
259
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Breakdown of individual attendance at Board meeting
12 meetings in 2024
Attendance
Kari Jordan
12/12
Heinz Jörg Fuhrmann
12/12
Kati ter Horst (until September 30, 2024)*
7/8
Jyrki Mäki-Kala
12/12
Päivi Luostarinen
12/12
Petter Söderström
12/12
Pierre Vareille
11/12
Julia Woodhouse
12/12
* Excluding meetings in which a conflict of interest was present due to the CEO appointment process.
Diversity principles of the Board of Directors
The diversity of the Board of Directors supports the vision and long-term objectives of the
Group. Outokumpu recognizes the importance of a diverse Board, taking age, educational
and international background, professional expertise, experience from relevant industrial
sectors as well as a well-balanced gender representation into account. In accordance with
the Shareholders’ Nomination Board Charter, the Nomination Board shall take the diversity
principles, the applicable legislation and Stock Exchange rules and regulations as well as
the recommendations of the Finnish Corporate Governance Code into consideration when
preparing its proposals to the General Meeting and the progress in achieving set objectives
shall be disclosed annually. The objective of a well-balanced Board structure in terms of
gender representation was largely achieved in 2024.
The review by the Board of Directors is available in the Financial year section in the Annual
report.
Composition and operations of
the Board committees
The Board of Directors has set up two permanent committees, the Audit Committee and the
Remuneration Committee. They consist of Board members and the Board has confirmed the
rules of procedure for these committees.
The Board of Directors may appoint additional committees from among its members and
define their purpose and rules of procedure. There were no additional committees in 2024.
All Board committees shall report on their work to the Board of Directors. The Board
committees shall act as preparatory bodies for the Board of Directors and shall not have
authority to take decisions on matters that fall within the Board’s authority unless
specifically so authorized by the Board or other authority.
Audit Committee
The Board Audit Committee consists of a minimum of three Board members. At least one of
the Committee members shall have an appropriate education and special expertise in
accounting or auditing. The Committee’s task is, in greater detail than is possible for the
Board as a whole, to deal with matters relating to financial reporting and statements and
statutory sustainability reporting, the Company’s financial position, auditing and statutory
sustainability reporting assurance, internal controls, compliance matters and risk
management procedures, the scope of internal and external audits and sustainability
reporting assurance, fees paid to the auditors and sustainability reporting assurance
provider, the Group’s tax position, the Group’s financial policies, monitoring and assessing
related party transactions and other procedures for managing Group risks.
In addition, the Audit Committee prepares a recommendation to the Board of Directors
concerning the election of an external auditor and sustainability reporting assurance provider
at a General Meeting.
The Audit Committee also prepares a recommendation to the Board of Directors concerning
the decision on auditing fees at a General Meeting. The Committee’s rules of procedure are
further defined in the Audit Committee Charter, approved by the Board, The Audit Committee
met six times during 2024, and the attendance rate was 100%.
Breakdown of individual attendance at Audit Committee meetings
Six meetings in 2024
Attendance
Jyrki Mäki-Kala
6/6
Päivi Luostarinen
6/6
Petter Söderström
6/6
Julia Woodhouse
6/6
Outokumpu Annual Report 2024
260
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Remuneration Committee
The Board Remuneration Committee consists of the Chairman of the Board and a minimum
of two additional Board members. The task of the Remuneration Committee is to prepare
proposals to the Board concerning the appointment of the Company’s top management and
principles relating to the compensation they receive. The Remuneration Committee also
prepares the proposals as to the Company’s Remuneration Policy and Remuneration Report.
The Committee’s rules of procedure are further defined in the Remuneration Committee
Charter, approved by the Board. The Remuneration Committee met 13 times during 2024,
and the attendance rate was 98%.
Breakdown of individual attendance at Remuneration Committee meetings
13 meetings in 2024
Attendance
Kari Jordan
13/13
Heinz Jörg Fuhrmann
13/13
Kati ter Horst (until September 30, 2024)*
6/7
Pierre Vareille
13/13
* Excluding meetings in which a conflict of interest was present due to the CEO appointment process.
The general objective of the Board
of Directors is to direct
Outokumpu’s business and
strategies in a manner that
secures a significant and sustained
increase in the value of the
Company for its shareholders.
Outokumpu Annual Report 2024
261
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Shareholders’ Nomination Board
The Shareholders’ Nomination Board of Outokumpu (the “Nomination Board”) is
responsible for preparing proposals to the General Meeting for the election and
remuneration of the members of the Board of Directors and ensuring that the Board of
Directors and its members embody a sufficient level of knowledge and experience for the
needs of the Company. In its work, the Nomination Board shall comply with the legislation
and the Finnish Corporate Governance Code in force, as well as the applicable Stock
Exchange rules and regulations. The Nomination Board’s Charter regulates the nomination
and composition of the Nomination Board as well as defines the tasks and duties of the
Nomination Board.
The Nomination Board consists of five members. Four of the members represent the
company’s four largest shareholders and the Chairman of the company’s Board of Directors
acts as the fifth member of the Nomination Board.
The representatives of the four largest shareholders of the company are annually appointed
to the Nomination Board. The largest shareholders of the company are determined on the
basis of the shareholders’ register of the Company maintained by Euroclear Finland Oy,
according to the ownership situation on the first business day of August each year. The
company’s shareholders’ register only consists of shareholders who are directly registered
in the Finnish book-entry system. Accordingly, to be eligible for membership in the
Nomination Board, a nominee-registered shareholder needs to register the respective
shareholding directly in the Finnish book-entry system for at least the said date.
In case a shareholder, who under the Finnish Securities Markets Act has an obligation to
announce changes in its shareholdings and to sum up its holdings together with the
holdings of certain other parties when doing so (flagging obligation), presents no later than
on July 31 a written request to that effect to the Chairman of the Company’s Board of
Directors, then the holdings of such shareholder and other parties shall be summed up for
the purposes of determining the holdings of the largest shareholders.
In case two or more shareholders own an equal number of shares and, as a consequence,
the four largest shareholders cannot be determined, the status of these shareholders
among the four largest shareholders shall be resolved by drawing lots.
The Chairman of the Board of Directors shall request the four largest shareholders of the
company each to nominate one member to the Nomination Board. Should a shareholder
wish not to use its nomination right, the right transfers to the next largest shareholder who
would otherwise not have a nomination right. The renunciation of the nomination right
cannot be revoked during the term of office of the Nomination Board.
The term of office of the members of the Nomination Board expires annually when a new
Nomination Board has been appointed. A shareholder may change its representative in the
Nomination Board mid-term, should there be a weighty cause for such a change.
Decisions of the Nomination Board shall be unanimous. If unanimity cannot be reached,
members of the Nomination Board shall present their own proposals to the Annual General
Meeting individually or jointly with other members of the Nomination Board.
Shareholders with the right to appoint representatives to the Nomination Board in 2024
were Solidium Oy, Varma Mutual Pension Insurance Company, Ilmarinen Mutual Pension
Insurance Company and the Social Insurance Institution of Finland.
These shareholders nominated the following individuals as their representatives in the
Nomination Board:
•
Reima Rytsölä, CEO of Solidium Oy, b. 1969, M.Soc.Sc. (Econ.), male,
•
Pekka Pajamo, CFO at Varma Mutual Pension Insurance Company, b. 1962, M.Sc.
(Econ.), male,
•
Jouko Pölönen, President and CEO of Ilmarinen Mutual Pension Insurance Company, b.
1970, M.Sc. (Econ.), CPA (certified public accountant) and eMBA, male and
•
Outi Antila, Director General at The Social Insurance Institution of Finland, b. 1957,
Master of Laws with court training, Master of Laws, female.
Reima Rytsölä was elected Chairman of the Nomination Board, and Kari Jordan, Chairman
of the Outokumpu Board of Directors, served as the fifth member of the Nomination Board.
Biographical details regarding Kari Jordan can be found earlier in the statement in the
Board of Directors section.
The Nomination Board convened five times, and the attendance rate was 96%. The
Nomination Board has submitted its proposals regarding the Board composition and
director compensation to Outokumpu’s Board of Directors, and the Board has incorporated
these proposals into the notice convening the Outokumpu 2025 Annual General Meeting of
Shareholders.
Outokumpu Annual Report 2024
262
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Executive Management
Biographical details of the CEO and the Leadership Team on December 31, 2024
Kati ter Horst
President and CEO
b. 1968, Finnish citizen, female
M.Sc. (Econ.), MBA (International Business)
President and Chief Executive Officer October 2024–
Chairman of the Leadership Team October 2024–
Responsibility: Group management, safety and health, and
business area Europe.
Employed by Outokumpu since October 2024.
Work experience
Divisional CEO, EMEA: Aliaxis 2022–2024
Executive Vice President, Head of Stora Enso Paper, member of the Group Leadership team
2014–2022
Senior Vice President, Paper Sales, Printing and Living: Stora Enso 2013–2014
Senior Vice President, Office Paper Sales, Printing and Reading: Stora Enso 2012–2013
Director, Customer Service Centre West, Publication Paper: Stora Enso 2010–2012
Several managerial positions in the paper business, 1996–2010
Business analyst, Jaakko Pöyry Consulting, Singapore 1994–1996
Positions of trust
Board member: Eurofer (the European Steel Association) November 2024–
Board member (2016–September 2024) and Vice Chairman (2022– September 2024):
Outokumpu Corporation
Member of the Supervisory Board: Wienerberger AG, May 2021–September 2022
Board member: Climate Leadership Coalition 2019–2022
Board member (2017–2022), Vice Chair (2019–2020) and Chair (2020–2022): EURO-
GRAPH asbl
Board member: Finnish Forest Industries Federation 2015–2022
Marc-Simon Schaar
Chief Financial Officer
b. 1976, German citizen, male
M.Sc. (International Business), Chartered Accountant
(Institute of Chartered Accounts of Scotland)
Chief Financial Officer 2024–
Member of the Leadership Team 2023–
Responsibility: Financial and business controlling, treasury,
investor relations, mergers and acquisitions, taxation,
internal controls and internal audit, IT, raw material and
general procurement.
Employed by Outokumpu since 2012.
Work experience
Chief Procurement Officer: Outokumpu 2023–2024
Senior Vice President – Raw Materials: Outokumpu 2021–2023
Senior Vice President – Treasury, Risk Management, M&A and Investor Relations:
Outokumpu 2020–2022
Senior Vice President – Finance, business areas Europe and Ferrochrome: Outokumpu
2016–2020
Senior Vice President – Head of Group Controlling (FP&A), M&A and Management
Information Systems: Outokumpu 2014–2016
Vice President: Head of Special Projects: Outokumpu 2013–2014
Senior Manager: Accounting, Controlling and Post-Merger Integration: Inoxum 2012–2013
Manager Transaction Advisory Services: EY 2006–2011
Positions of trust:
Member of the Board of Directors: OSTP Holding Oy 2017–
Chairman of the Finance Committee: Fennovoima Oy 2021–2022
Member of the Board of Directors: Outokumpu Nirosta GmbH 2014–2019
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Remunation Report
Information for investors
Stefan Erdmann
Chief Technology Officer
b. 1972, German citizen, male
M.Sc. (Eng.)
Chief Technology Officer 2020–
Member of the Leadership Team 2020–
Responsibility: Research and development, technology,
energy, and investment steering.
Employed by Outokumpu since 2018.
Work experience
Senior Vice President and CTO: Outokumpu 2018–2020
Technical Managing Director: Aluminium Norf GmbH 2015–2018
Vice President; Global Research and Development: Novelis Inc 2011–2015
General Manager; Business Unit Can Europe: Novelis AG 2009–2011
General Manager: Novelis Deutschland GmbH 2007–2009
Sales Director Painted Products: Novelis Europe 2006–2007
Various operational and managerial positions: Novelis and Alcan 1993–2006
Positions of trust
Board member: German Steel Association (Wirtschaftsvereinigung Stahl) 2020–
Juhani Ristaniemi
Executive Vice President – General Counsel
b. 1968, Finnish citizen, male
LL.M., MBA (International Business)
Executive Vice President – General Counsel 2024–
Member of the Leadership Team 2024–
Responsibility: Legal, ethics and compliance. Secretary to
the Board of Directors, the Audit Committee, the
Shareholders’ Nomination Board and the Outokumpu
Leadership Team.
Employed by Outokumpu since 2022.
Work experience
Senior Vice President – General Counsel: Outokumpu 2022–2024
Assistant Group General Counsel & Head of Legal for South Europe, Middle East and Africa:
KONE Corporation 2021–2022
Senior Vice President and General Counsel for Europe, Middle East, Africa and Asia-Pacific:
KONE Corporation 2005–2021
General Counsel and member of the Executive Board: Jaakko Pöyry Group Oyj’s Energy
Business Group 2001–2005
Vice President & General Counsel and other legal positions: Valio Oy 1992–2000
Positions of trust
Member of the legal committee: Confederation of Finnish Industries 2013–
Member of the International Trade Committee of the Finland Chamber of Commerce which
also acts as the ICC Advisory Board in Finland 2015–
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Remunation Report
Information for investors
Martti Sassi
President – Business Area Ferrochrome
b. 1964, Finnish citizen, male
M.Sc. (Eng.)
President – Business Area Ferrochrome 2020–
Member of the Leadership Team 2020–
Responsibility: Business area Ferrochrome.
Employed by Outokumpu since 1990.
Work experience
Senior Vice President, Business Area Ferrochrome: Outokumpu 2018–2020
Senior Vice President – Tornio Stainless and Ferrochrome Operations:
Outokumpu 2016–2018
Senior Vice President – Tornio Stainless Operations: Outokumpu 2012–2016
Vice President – Tornio Stainless Business Excellence: Outokumpu 2010–2012
General Manager – Tornio Cold Rolling Plant: Outokumpu 2006–2010
Various operations and R&D positions: Outokumpu 1990–2006
Positions of trust
Board member: Technology Industry Employers of Finland 2021–
Board member: Association of Finnish Steel and Metal Producers 2020–2022, 2024–
Chairman of Board: Chamber of Commerce in Lapland 2020–2021
Council member: International Chromium Development Association 2019–2023
Board member: EuroAlliages 2018–
Rolf Schencking
President – Business Line Advanced Materials
b. 1969 German citizen, male
M.Sc. (Mechanical Engineering), B. Sc. (Accounting and
Finance)
President – Business Line Advanced Materials October
2024–
Member of the Leadership Team October2024–
Responsibility: Business line Advanced Materials within the
business area Europe.
Employed by Outokumpu since October 2024.
Work experience
Technical General Manager/Chief Technology Officer: VDM Metals 2018–2022
Chairman, Executive Board: Constellium Deutschland GmbH and Constellium
Singen GmbH 2015–2018
Deputy Managing Director, Sales and successor to the Managing Partner:
MK Metallfolien 2012–2015
Chief Executive Officer: Hydro Aluminium Slim S.p.A Italy (Norsk Hydro) 2008–2012
Chief Executive Officer: Hydro Aluminium Malaysia Sdn.Bhd (Norsk Hydro) 2005–2008
Director and Head of BU Production Planning, Business Unit Foil (Norsk Hydro) 2002–2005
Head of Production Planning Business Unit Foil, Plant Grevenbroich: VAW Aluminium
(acquired by Norsk Hydro in 2002) 1999–2001 International Management Trainee, ABB
Motors and Mechanical Inc: ABB Industrietechnik 1997–1999
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Remunation Report
Information for investors
Johann Steiner
Executive Vice President – Sustainability,
Strategy and People
b. 1966, German citizen, male
M.Sc. (Econ.)
Executive Vice President – Sustainability, Strategy and
People 2024–
Member of the Outokumpu Leadership Team 2013–
Responsibility: Sustainability, people, communications,
strategy and Transformation Office.
Employed by Outokumpu since 2013.
Work experience
Executive Vice President – Sustainability, People and Communications 2023
Chief Human Resources Officer: Outokumpu 2020–2023
Executive Vice President – Human Resources and Organization Development:
Outokumpu 2016–2020
Executive Vice President – Human Resources, IT, Health and Safety:
Outokumpu 2013–2016
Executive Vice President – Human Resources and Health, Safety and Sustainability:
Outokumpu Oyj 2013
Group HR Director: SAG Group GmbH 2012
Operating Partner: Humatica AG 2010–2012
Group HR Director: Clariant International AG 2002–2008
VP Executive Policies: EADS (former DaimlerChrysler Aerospace AG) 1999–2002
Senior Consultant: Towers Perrin 1993–1998
Niklas Wass
President – Business Line Stainless Europe
b. 1977, Swedish citizen, male
M.Sc. (Environmental Science)
President – Business Line, Stainless Europe 2022–
Member of the Leadership Team 2020–
Responsibility: Business line Stainless Europe within
the business area Europe.
Employed by Outokumpu since 2002.
Work experience
Executive Vice President – Operations, Business Area Europe 2020–2022
Senior Vice President – Tornio Operations: Outokumpu 2018–2020
Vice President – Quarto Plate: Outokumpu 2015–2018
General Manager – Production: Outokumpu Degerfors 2010–2015
Various operational positions: Outokumpu 2002–2010
Positions of trust
Board member: Swedish Steel association (Jernkontoret) 2015–
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Corporate Governance Statement 2024
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Remunation Report
Information for investors
Tamara Weinert
President – Business Area Americas
b. 1965, German citizen, female
MBA, M.Sc.(Protected Landscape Management)
President – Business Area Americas 2021–
Member of the Leadership Team 2020–
Responsibility: Business area Americas
Employed by Outokumpu since 2012.
Work experience
Acting President – Business Area Americas: Outokumpu 2020–2021
SVP – Sales South & Overseas, Business Area Europe: Outokumpu 2016–2020
SVP – Finance & Control, Business Area Europe: Outokumpu 2013–2016
VP – Investor Relations: Outokumpu 2012–2013
Director – Treasury, Risk Management, Insurance & Investor Relations: Inoxum 2012
Director – Head of Corporate & Structured Finance: Vattenfall 2010–2012
Treasurer: N.V. Nuon 2008–2010
Risk Management: N.V. Nuon 2000–2008
International postings in India, Pakistan, Singapore, Russia, Netherlands, the U.S., and
Finland.
Positions of trust
Board member: BASF 2024–
Board member: BCA, the Business Council of Alabama 2022
Board member: American Iron and Steel Institute 2020–
Member of the Board of Directors: Mobile Chamber of Commerce, Alabama, US 2021–2023
Outokumpu shares and share-based rights (parents or subsidiaries) owned by
Leadership Team members and his/her controlled corporations on December
31, 2024
Members of the leadership team
Number of shares
Kati ter Horst
39,609
Marc-Simon Schaar
98,944
Stefan Erdmann
66,101
Juhani Ristaniemi
8,810
Martti Sassi
46,775
Rolf Schencking
0
Johann Steiner
213,515
Niklas Wass
44,977
Tamara Weinert
80,267
Total
598,998
CEO and the possible deputy to the CEO
The President and Chief Executive Officer (CEO) is responsible for the company’s
operational management, in which the objective is to secure significant and sustainable
growth in the value of the company for its shareholders.
The CEO prepares decisions and other matters for the meetings of the Board of Directors,
develops the Group’s operations in line with the targets agreed with the Board of Directors,
and ensures the proper implementation of Board decisions. The CEO is also responsible for
ensuring that the existing legislation and applicable regulations are observed throughout
the Group. The deputy to the CEO, if one has been appointed, is responsible for attending
to the CEO’s duties in the event that the CEO is prevented from doing so. Currently, no
deputy to the CEO has been appointed.
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Outokumpu Leadership Team
and Business Area Boards
The Outokumpu Leadership Team, chaired by the CEO, is a reporting and decision-making
forum for steering and managing Outokumpu’s corporate agenda in support of the CEO.
The Outokumpu Leadership Team consists of the CEO, his/her deputy (if one has been
appointed) and other key members of senior management.
Each Outokumpu business area is steered by a Business Area Board, chaired by the CEO.
The Business Area Boards consist of the CEO, the Chief Financial Officer, the Head of
the respective business area and selected other key members of senior management.
The decision-making authorities of the Leadership Team and the Business Area Boards
follow from the authority of the CEO. It is the duty of these bodies to run and develop
the Group’s operations in line with the strategy and targets set by the Board of Directors.
The Leadership Team and the Business Area Board meetings are convened by the CEO or
his/her order. Minutes shall be kept for each meeting.
The Leadership Team and the Business Area Boards typically meet once a month.
Organization structure on Dec 31, 2024
Operational management
targets to secure
significant and sustainable
growth in the value
of the company.
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Internal control and risk management
According to the Finnish Limited Liability Companies Act and the Finnish Corporate
Governance Code, the Board of Directors is responsible for ensuring that the company’s
internal controls are appropriately organized. As a listed company, the Group has to comply
with a variety of regulations. Furthermore, it is important to ensure that key operational and
reporting targets are met. Outokumpu has developed a system of internal controls and
implements it throughout the company. The main purpose of the internal control system is
to provide management and the Board of Directors with reasonable assurance regarding
the achievement of objectives relating to the Group’s operations, reporting and compliance.
Outokumpu applies the COSO Internal Control – Integrated Framework (2013) as main
guidance for the internal control system. Outokumpu’s internal control system is based on
the Internal Control Policy and related instructions, common ways of working with clearly
defined roles and responsibilities, and processes run on a digital platform. The risk
management policy approved by the company’s Board of Directors defines the objectives,
approaches and areas of responsibility in the Group’s risk management activities. The risk
management process consists of the following five core stages: 1) risk identification, 2) risk
evaluation, 3) mitigation actions, 4) control activities, and 5) risk reporting. Read more
about risks and opportunities. The process for control activities is further described in the
below chapter.
Internal controls over financial reporting
This section provides a description of how the internal controls over financial reporting are
organized at Outokumpu. Outokumpu’s objective is to ensure that common financial
processes and reporting practices are followed throughout the Group and that effective
internal controls relating to financial reporting are established. Outokumpu’s Internal
Control Policy defines main roles, responsibilities, principles, and objectives for the Group’s
internal control system. The Board of Directors is ultimately responsible for overseeing the
system of internal controls and the CEO, supported by other members of executive
management, is responsible for implementing and maintaining an efficient system of
internal controls. The Group’s internal control function supports and develops internal
control management processes, is responsible for control testing and monitoring of the
system of internal controls. Components of the system include control environment, risk
assessment, control activities, information and communication as well as monitoring
activities.
Internal control and risk
management ensure that common
financial processes and reporting
practices are followed and
effective internal controls
established.
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Outokumpu’s consolidated financial statements have been prepared in accordance with
IFRS Accounting Standards as adopted by the European Union. The Outokumpu Accounting
Principles are Outokumpu’s application guidance on IFRS. Outokumpu also complies with
the regulations regarding financial reporting published by the Financial Supervisory
Authority (FIN-FSA), Nasdaq Helsinki, and the European Securities and Markets Authority
(ESMA). The objective of internal controls over financial reporting at Outokumpu is to
provide reasonable assurance that the financial reporting and the preparation of financial
statements are in accordance with applicable laws, regulations, and internal requirements.
Control environment
The foundation of Outokumpu’s control environment consists of policies, standards,
processes, and structures that provide the basis for the internal control system across the
organization and define the ways in which Outokumpu operates. The performance
management as well as the risk and internal control process are key management activities
in enabling an efficient control environment. Throughout the Group’s operations, the
planning activities and the setting of compliance, reporting and operational targets,
including financial targets, are executed in accordance with Outokumpu’s overall business
targets. Management monitors related achievements. Risks or threats are handled through
regular reporting and status review meetings.
Key policies relevant to internal controls
•
Acceptable use of IT Policy
Outlines the guidelines of constraints and practices that a user must agree to for
access to Outokumpu’s network, the internet, and other resources.
•
Approval Policy
Defines the relevant authorization levels and thresholds within the Outokumpu Group.
Applies to the internal approval of contracts and other commitments made by the
business areas and Group Functions of the Outokumpu Group.
•
Code of Conduct
Sets out the ethical standards and provides guidelines for a common way of working.
•
Identity and Access Management Instructions
Enables the right individuals to access the right resources at the right times for the
right reasons.
•
Internal Audit Charter
Describes the main principles and rules followed by the Outokumpu Group in relation to
internal audit’s assignment and underlying values.
•
Internal Control Policy
Defines main roles, responsibilities, principles, and objectives for Outokumpu’s internal
control system.
•
Outokumpu Accounting Principles (OAP)
Sets out the accounting principles and disclosure requirements that must be followed
by all legal companies and reporting units in reporting their financial information to the
Group.
•
Risk Management Policy
Describes the risk management principles and guidelines in the Outokumpu Group and
scope, roles and responsibilities for risk management activities.
•
Treasury Policy
Defines objectives and main principles for treasury as well as the distribution of related
tasks and responsibilities within the Outokumpu Group.
Risk assessment
Risk assessment involves a dynamic and iterative process identifying and evaluating risks
to achieve predefined objectives and provides the foundation for determining how risks will
be managed. The risks related to the financial reporting are managed according to
Outokumpu’s risk management policy. The risks related to financial reporting are identified
and evaluated in risk workshops or similar, addressing risks for the most relevant parts of
the financial reporting process.
Control activities
The objective of control activities is to prevent, discover, and correct potential errors and
deviations. Control activities also include management of segregation of duty risk (SoD) in
the main ERP environments. Control activities are performed at all levels of the
organization, at various stages within business processes, and within the key technologies,
e.g. ERP systems. Control activities for the financial reporting consist of various measures
and include reviews of financial reports by management teams, the reconciliation of
accounts, analyses of the logic behind reported figures, forecasts compared to reported
figures, and analyses of the Group’s financial reporting processes, among others. A key
component is the monitoring of monthly performance against financial and operational
targets.
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Information and communication
Group-wide policies and principles are available to all Outokumpu’s employees. Instructions
relating to financial reporting are communicated to all involved parties. The main
communication channels employed are regular controller meetings, Outokumpu’s intranet
as well as digital platforms and databases. Outokumpu’s executive management is
regularly receiving information on internal controls. Furthermore, Finance Leadership Team
meetings are organized regularly to discuss and address finance related topics e.g. relating
to the financial reporting.
Monitoring activities
The organization evaluates and communicates internal control deficiencies in a timely
manner to the parties responsible for taking corrective action, including executive and
senior management, and the Board of Directors, as appropriate. Both management in
Outokumpu’s group companies and in the finance function are responsible for the follow-up
and monitoring of internal controls connected with financial reporting. Overall, development
and monitoring of the internal control process and platform, as well as control testing, are
performed by the Group's internal control function. The internal audit function monitors that
an appropriate control environment exists across the Group. Risk management, the
compliance function, and Outokumpu’s external auditors are also engaged in the review of
control activities. The findings of the assurance procedures as well as the maturity of the
system of internal controls are reported to the Audit Committee and the executive
management on a regular basis.
Control activities highlights 2024
•
During 2024, the coverage of internal controls improved further especially in the areas
of cyber, IT general controls and transactional finance. In addition, development of
inventory management process continued and implementation of related controls to the
digital platform has been on-going.
•
Group’s internal control function continued to strengthen control testing procedures to
reach reasonable coverage of control testing. The coverage is currently at about forty
percent of all key controls. Results of the testing are presented to the attention of the
control owners for further consideration.
•
Also, improvements in the segregation of duties management (SoD) continued in 2024
with enhanced SoD reporting and risk mitigation, leading to risk reduction especially in
the SAP S/4HANA environment.
•
In addition, preparations for the next rollout of the SAP S/4HANA together with other
related IT systems continued.
Internal audit
The mission of internal audit is to provide an independent and objective assurance, control,
and consulting function designated to add value, improve operations, and monitor and
support the organization in the achievement of its objectives.
Through a systematic, disciplined approach, internal audit determines whether governance
and compliance processes, the internal control system, and the risk and control
management process, as designed and represented by the Board of Directors and the
Outokumpu Leadership Team, are effective and efficient.
Internal audit, with the third line of defense role in risk management, performs audits
according to the audit plan approved by the Audit Committee. Internal audit monitors,
together with the Group’s ethics and compliance function, adherence to Group principles,
policies, and instructions, and leads investigations into fraudulent and noncompliant
behaviors and activities.
Key activities in 2024
•
Internal audit performed seven audits relating to the 2024 audit plan. The results of the
audits as well as progress in derived actions are reported to the relevant management,
the Audit Committee, and the external auditor.
•
Total of 35 misconduct reports were recorded (2023: 48), many of the received reports
eventually leading to recommendations for management actions.
Planned key activities for 2025
•
During the year, from seven to nine site and thematic audits are expected.
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Ethics and compliance
Outokumpu is strongly committed to the highest ethical standards and complies with the
applicable laws and regulations of the countries in which it operates as well as with the
agreements and commitments it has made. Outokumpu’s Code of Conduct sets out these
ethical standards and provides guidelines for common ways of working with the aim of
ensuring that all Outokumpu employees live up to Outokumpu’s ethical standards.
Outokumpu also expects that its business partners follow similar ethical standards as
Outokumpu.
Outokumpu’s legal and compliance function is responsible for managing and continuously
developing Outokumpu’s group-wide ethics and compliance program. Outokumpu’s ethics
and compliance program is described in more detail in the Sustainability Statement in the
Review by the Board of Directors. The Legal and Compliance function reports to the CEO as
well as directly to the Audit Committee on ethics and compliance related matters.
Ethics and compliance related matters are also regularly handled in an internal Ethics and
Compliance Steering Group which consists of the Head of Controls and Internal Audit, Head
of Ethics and Compliance and selected members of the Outokumpu Leadership Team. The
Ethics and Compliance Steering Group had four meetings in 2024. In addition, a global
network of ethics and compliance contact persons and several data protection governance
bodies support the implementation of the ethics and compliance program in the business
areas, business lines and group functions.
Insider management
The company’s Insider Rules, the Finnish insider laws and regulations, including the EU
Market Abuse Regulation, constitute the primary legal framework for the insider issues
relevant to the Group and its employees.
Furthermore, the Regulation on EU Energy Market Integrity and Transparency sets forth
similar requirements as the Market Abuse Regulation on dealing with inside information
relating to wholesale energy products. As the company is a participant in the wholesale
energy market, the company’s Insider Rules apply to such energy-related inside
information, as applicable.
The persons discharging managerial responsibilities in Outokumpu, in the meaning of the
Market Abuse Regulation, include members of the Company’s Board of Directors, the CEO,
and other members of the Outokumpu Leadership Team (“the Management”). The
Management together with the persons or companies closely associated with a member of
the Management constitutes the so called “Notifying Persons”. Outokumpu maintains a
non-public list of the Notifying Persons.
Outokumpu applies a restricted period of thirty (30) calendar days before the
announcement, as well the day of the announcement, of an interim financial report and a
year-end report – a so called “Closed Window”. During this period, the Management, the
persons subject to trading restrictions and any legally incompetent persons under their
custody shall not conduct any transactions, on his/her own account or for the account of a
third party, directly or indirectly, relating to the company’s shares or debt instruments, or
derivatives or other financial instruments linked thereto. Separate, non-public, project-
specific insider registers are maintained for insider projects. Persons defined as project-
specific insiders are those who, in the course of their duties in connection with a project,
receive inside information concerning the Group which, if or when realized, is likely to have
a significant effect on the value of the company’s publicly traded securities.
The Company has the obligation to inform the public as soon as possible of inside
information that directly concerns the Company, unless the Company has decided that the
publication of the inside information shall be delayed, in accordance with the applicable
insider regulations. The publication of inside information shall be made in accordance with
the Company’s Disclosure Policy.
Outokumpu’s General Counsel is responsible for the coordination and supervision of insider
topics.
Related party transactions
The Second Shareholders’ Rights Directive (EU), the International Accounting Standards IAS
24, the Companies Act and the Securities Markets Act as well as the Finnish Corporate
Governance Code constitute the primary legal framework in the related party transaction
principles relevant to the Outokumpu Group and its related parties.
Definition of related parties and maintenance
of the list of related parties
Outokumpu Corporation’s related parties are determined in accordance with the
International Accounting Standards (IAS 24) and they include, i.a., the Group subsidiaries
and Associated companies, Solidium Oy, members of the parent company’s Board of
Directors and the Leadership Team as well as their related persons and companies. The
company’s Legal and Compliance function maintains a non-public list of Outokumpu Oyj’s
related parties, which is updated on a regular basis.
Evaluating related party transactions
A related party transaction is any transaction which is conducted between the Outokumpu
Group and a related party of Outokumpu Corporation. Transactions between a company and
its related parties are allowed, provided that they promote the purpose and interests of the
company and are commercially justified.
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Any transactions that are not conducted in Outokumpu Group’s ordinary course of business
or are not implemented under arms-length terms require specific approval according to the
Outokumpu Group’s Approval Policy. Any such transactions are escalated for review on the
Group’s executive level and cross-checked against the related parties. Any related party
transactions that are not conducted in Outokumpu Group’s ordinary course of business will
require a decision by Outokumpu’s Board of Directors and a transaction which would be
deemed material for Outokumpu’s shareholders will also have to be publicly disclosed. The
decision making of the Board of Directors also takes provisions on conflicts of interest into
account as board members cannot participate in deciding a matter concerning themselves.
Board members also have a conflict of interest and cannot participate in decisions
concerning a transaction with one of their related parties if that transaction is not part of
the company’s ordinary course of business or is not implemented under arms-length terms.
Monitoring and reporting related party transactions
Outokumpu’s Audit Committee monitors the evaluation process. Related party transactions
are reported to the Audit Committee on a regular basis. Outokumpu’s finance and control
functions monitor related party transactions regularly in arrears as a part of the company’s
reporting and control procedures. Information on transactions concluded between the
company and its related parties is disclosed annually in the company’s consolidated
financial statement.
Auditors
According to the Company’s Articles of Association, the Company shall have one auditor
which shall be an audit firm whose assigned responsible auditor is an Authorized Public
Accountant. The term of the auditor shall end at the end of the next Annual General
Meeting following the election. Furthermore, the Company shall have a sustainability
reporting assurance provider elected by the Annual General Meeting for the same term as
the auditor, to assure the Group’s sustainability reporting.
The Board of Directors has the duty to make a proposal to the Annual General Meeting as
to the election and fees of the auditor. A proposal to the Annual General Meeting on the
election of the auditor that has been made known to the Board of Directors prior to the
Annual General Meeting will be made public if it is supported by shareholders holding a
minimum of 10% of all the Company’s shares and voting rights and the person or company
proposed has consented to such nominations.
The Company’s auditors submit the statutory auditor’s report to the company’s
shareholders in connection with the company’s financial statements. The auditors also
report their findings to the Board Audit Committee on a regular basis and at least once a
year to the full Board of Directors. The parent company, Outokumpu Corporation, was
audited by PriceWaterhouseCoopers Oy, and the responsible auditor was Samuli Perälä,
Authorized Public Accountant. PriceWaterhouseCoopers Oy was also responsible for
overseeing and coordinating the auditing of Group companies, and for providing assurance
on the Company’s sustainability reporting.
PricewaterhouseCoopers Oy was elected as the Company’s auditor in the Annual General
Meeting held on April 3, 2024 and has been the auditor of Outokumpu for eight
consecutive terms. Both Outokumpu and PricewaterhouseCoopers Oy emphasize the
requirement stipulating that the auditor be independent of the company being audited. The
PwC Network Independence policy is based on the International Ethics Standards Board for
Accountants’ (IESBA) Code of Ethics for Professional Accountants.
Outokumpu’s Board Audit Committee continuously monitored the non-audit services
purchased by the Group from PriceWaterhouseCoopers on a global level. In 2024, the
auditors were paid fees totalling EUR 3.2 million, of which the non-auditing services
accounted for EUR 0.3 million. The non-audit services fees include EUR 0.2 million relating
to assurance of sustainability reporting.
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Risk management
Outokumpu is committed to managing risks in a proactive and effective manner
to contribute in success in strategy execution.
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Risks and opportunities
Effective risk management is critical to the delivery of our strategic targets.
Risks and opportunities delivering on
Outokumpu’s strategy
Outokumpu’s strategy is built on our strong foundation, starting with the megatrends driving
stainless steel demand growth, our people and ways of working, leadership in sustainability,
high customer satisfaction and our stable operations and continuous improvement culture.
According to our vision to be customer’s first choice in sustainable stainless steel, we look
to retain and further improve our leading position in sustainability and meet our customers’
increasingly critical and challenging needs. Outokumpu is now in the second phase of its
three-phase strategy, strengthening the core of the company, and focuses on three key
priorities: sustainability, growth from productivity and customer-focused steering.
Effective risk management has a vital role in supporting the strategy execution. In order to
manage risks and opportunities associated with the strategy execution and delivery of the
strategic objectives, an effective risk management will facilitate:
•
Determining the appropriate level of risk tolerance and appetite
•
Identifying and assessing the risks and opportunities, and their impact on Outokumpu
•
Ensuring that appropriate processes, risk mitigations and controls are embedded across
the organization to manage the risk under each risk area
Risk areas relevant to Outokumpu
Our strategy and risk appetite shape our risk management approach. The risk management
approach is mapped to risk areas relevant for Outokumpu. The areas are regularly reviewed
and discussed in order to form an appropriate approach for identifying and managing
relevant risks.
The identified material risks and opportunities outlined in relation to the risk areas are
events that could materially affect (negatively or positively) our ability to meet our strategic
objectives. While risks and uncertainties could hinder us, opportunities can further leverage
our capabilities in reaching targets. Unlocking opportunities is the key to success in our
strategy implementation.
The risk management approach with the eight risk areas with identified material risks is set
out in the table on the next page. Financial risks are described in further detail in note 5 to
our audited consolidated financial statements. Risks associated with internal controls over
financial reporting are described in Corporate Governance Statement.
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Risk management approach is mapped into risk areas
Macroeconomics and steel markets
Legal and compliance
Raw material and energy prices
Operational / supply chain
Steel demand is affected by business
environment, global economy, market
megatrends, demand for sustainable
materials and long-term prospects for
stainless steel across regions. The risk of
overcapacity in stainless steel, geopolitical
tensions, global trade and industrial
actions and trade defense measures could
also impact the supply-demand balance.
Climate change and the green transition to
a low-carbon economy may affect demand
and growth development though changes in
operating environment.
Material risks in the area:
•
Stagnation/economic downturn
•
Trade and geopolitics
Outokumpu may be exposed to legal and
compliance risks and disputes in the
jurisdictions it operates. Breaches of applicable
laws and regulations, exposure to crime, fraud,
misconduct and other illegal activities or
unethical behaviour, may result in adverse
criminal, financial or reputational
consequences. Also, the evolving legal and
compliance requirements in various areas
require constant attention to which Outokumpu
is committed to. Legal and compliance risks
may further arise from various contractual
matters.
Price changes of alloy metals such as
nickel and chrome as well as volatility in
energy prices may have significant
impacts on net result, cash flow and
balance sheet. Price volatility may also
adversely impact stainless steel demand,
the level of inventories and consequently
also capacity utilization ratios.
Material risks in the area:
•
Metal price risk
•
Energy costs
Outokumpu’s production processes are
dependent on the continuous operation of
critical production equipment and the supply
of needed materials in production. Fire or
machinery breakdown, equipment failures,
supplier dependencies, natural disasters,
epidemics, or other factors could affect
operations or the supply for critical raw
materials and energy required in the
manufacturing process.
Material risks in the area:
•
Dependency on critical machinery and
suppliers
•
Low CO2 emission raw materials availability
•
Energy availability
Corporate security
ESG
Financial
Reporting
Outokumpu is committed to protecting
people, assets, information and reputation
by ensuring there is an effective and robust
approach to the management of security
risks. Unplanned interruptions or failures in
the applications and underlying
infrastructure could result in business
interruptions. Furthermore, a possible
security breach could cause damage to our
operations, assets, people or leaks of
sensitive information related to
Outokumpu, its personnel or partners such
as customers and suppliers.
Material risks in the area:
•
Cyber security
Sustainability at Outokumpu consist of three
pillars – environmental, social and governance –
and we are committed to the UN’s Sustainable
Development Goals. Outokumpu is committed
to ambitious climate targets aligned with the
SBTi’s 1.5°C degrees target to limit global
warming aiming to decrease carbon emission
intensity by 42% per tonne of stainless steel by
2030. Outokumpu's sustainability targets also
include an increased recycling rate and energy
efficiency, improved safety and organizational
health, diversity, equity and inclusion, supply
chain sustainability and zero environmental
incidents.
Material risks in the area:
•
Climate change
•
People and safety
•
Sustainable sourcing
Financial risks arise from changes in
metal prices, foreign currencies, interest
rates and fair values of equity
instruments, credit risk, liquidity risk,
country and counterparty risk. Financial
risks are described in further details in
note 5 to our audited consolidated
financial statements
The risks associated with reporting include
failure in financial reporting, incomplete
reporting or disclosures towards authorities,
incomplete sustainability reporting and
internal reporting. Risks associated with
sustainability reporting are described in
Sustainability statement and related to
financial reporting in Corporate Governance
Statement.
Opportunities can further leverage our capabilities in strategy implementation
•
Global megatrends such as urbanization as well as climate change all require
sustainable and circular solutions. Stainless steel has an important role in accelerating
green transition.
•
Outokumpu enables its customers to reduce their supply chain emissions and thus
assists in decarbonizing various industries.
•
By partnering with suppliers, we look to ensure low-carbon, sufficient and high-quality
supply of critical raw materials in the future.
Read more about the opportunities in connection with risk areas on the following pages.
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Risk management
Our three lines governance model
Outokumpu's risk management policy outlines the roles
and responsibilities of the relevant governance bodies in
implementing risk management, including continuous
reporting within the Outokumpu Group.
The Board of Directors carries ultimate responsibility for
risk management within Outokumpu. The CEO and CFO
form the governing body with the main responsibility for
ensuring risk management implementation. The
governance, risk, and compliance (GRC) functions
(consisting of risk management, legal, cyber and corporate
security, ethics and compliance, and internal control) are
responsible for coordination and supporting of risk
management procedures and monitoring. Risk ownership is
in the first line of defense, including risk identification,
evaluation, mitigation, and control. Internal audit
periodically reviews risk management, internal control,
compliance, and governance processes.
Descriptions of our three lines model can be found in the
table on the right.
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Risk management and
control procedures
Our risk management procedure and related assigned
responsibilities ensure structured and efficient risk
management across the organization.
We operate in accordance with the risk management policy
approved by the Board of Directors. The risk management
policy sets out our common risk management procedures
with clear roles and responsibilities. Within Outokumpu,
identified risks are monitored and controlled at different
organizational levels and supported by the digital platform.
By leveraging our digital risk management and control
platform, we improve risk communication and enhance the
overall effectiveness of our risk and control management
process.
Outokumpu is committed to managing risks in a proactive
and effective manner, which includes the early
identification and evaluation of risks, and the management
and mitigation of risks before they materialize. The risk
management process consists of the following five core
stages: 1) risk identification, 2) risk evaluation, 3)
mitigation actions, 4) control activities, and 5) risk
reporting. The process also includes control testing.
Furthermore, regular and active co-operation between GRC
and assurance functions further enhances situational
awareness and alignment of efforts.
The illustration on the right summarizes our risk and
control procedures.
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Material risks
Significant identified risks in relation
to the risk areas
Material risks recognized by Outokumpu's management could be of any nature and arise
from any part of the business, all having a potential material impact on our strategy
execution, business performance and objectives. Outokumpu regularly assesses the
likelihood and potential impact of risks from both financial and non-financial perspectives
in order to also reflect our ambition in sustainability strategy and reputational tolerance.
The evaluation of the material risks, and the effectiveness of our associated mitigation
actions and internal controls, reflect the management’s current expectations, forecasts and
assumptions, and involve critical judgments that are subject to changes in our internal
operations and external factors that are beyond our control. Outokumpu deploys preventive
and mitigating actions and controls to reduce the likelihood of certain threats. Some of the
threats cannot always be avoided. We closely monitor the threats on an ongoing basis and
develop business resilience plans to mitigate the disruptions caused by any threats.
Based on our risk evaluation criteria and scoring, Outokumpu has identified 11 material
risks in relation to the risk areas. They are presented in the table on the right. Outokumpu
continuously monitors and reassesses these material risks, reviews changes overtime, and
identifies new opportunities to achieve our strategy and new emerging material risks having
arisen. The identified material risks are described in the risk profiles on the following pages
to provide an overview of the possible threats, opportunities and our actions to mitigate
these risks.
We are continuously
monitoring and
mitigating identified risks.
Risk areas and material risks
Macroeconomics and steel markets
Stagnation/economic downturn
Macroeconomics and steel markets
Trade and geopolitics
Raw material and energy prices
Metal price risk
Raw material and energy prices
Energy costs
Operational/supply chain
Dependency on critical machinery and
suppliers
Operational/supply chain
Low CO2 emission raw materials
availability
Operational/supply chain
Energy availability
Corporate security
Cyber security
ESG
Climate change
ESG
People and safety
ESG
Sustainable sourcing
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Stagnation and economic downturn
Description
Outokumpu operates in global stainless steel market. The development in
the global economy including economic growth globally and in China,
inflation, geopolitical conflicts that could disrupt global supply chains, and
energy markets could all affect Outokumpu's operating environment and
stainless steel demand. Climate change with extreme weather conditions
could also impact economies and communities. Outokumpu believes that
the long-term outlook for stainless steel consumption remains positive as
there is an increasing need for long-lasting and sustainable solutions
including low-carbon stainless steel.
Opportunities
•
Global megatrends such as population growth and urbanization require
more steel. This calls for sustainable and circular solutions such as
stainless steel.
•
Create a defendable competitive advantage through sustainability,
particularly against Asian producers.
Threats
•
Weakening global economy and falling into recession could have a
negative impact on our business and demand for our products.
•
Geopolitical tensions and political instability in major economies could
negatively impact markets and consumer confidence.
•
Increased tariffs could impact the development of global economy and
inflation.
Outokumpu’s response
•
Continue implement the strategy to strengthen the core of the company
with sustainability, growth from productivity and customer-focused
steering as priorities.
•
Continue capital discipline with targeted investments in sustainability
and productivity to improve our margins.
•
Strengthen our market position further and develop more globally
diversified operations including Americas expansion, European
competitiveness, value-chain integration and sustainability leadership.
Read more about stainless steel market.
Risk area
Macro-
economics
and steel
markets
Trade and geopolitics
Description
Outokumpu is exposed to the developments of global trade policies and
geopolitics. Potential geopolitical conflicts and unfavorable trade policy
decisions for Outokumpu can result in the risk of increased unfair imports
on the home markets, or undermine access to the export markets.
Opportunities
•
By calling for a level playing field, Outokumpu could contribute to
creating fair competition in its markets.
•
More assertive trade and climate policies for the imports imposed by
governmental authorities in our home markets could level the playing
field and ensure they are not circumvented.
Threats
•
Imports surge if the trade defense measures in our home markets, (such
as quota measures, tariffs and antidumping/antisubsidy duties) are not
renewed or not made effective enough to mitigate unfair imports.
•
Geopolitical conflicts, trade sanctions or the trade policies imposed by
third countries could result in restricting access to our export markets
or, on the other hand disrupting access to our key raw materials.
Outokumpu’s response
•
Continue advocacy actions on the national level to promote relevant
measures and cooperate with organizations such as the European Steel
Association (EUROFER) and AISI (American Iron and Steel Institute) to
initiate new investigations when possible to ensure a level playing field
and fair competition.
•
Closely review the status of trade defense measures and related
investigations to be able to proactively react to the threat of import
surge, and ensure the measures are not circumvented.
•
Continually monitor the geopolitical and global trade policy
developments and proactively mitigate and increase resilience towards
potential adverse impacts to business and supply chain disruptions
Read more about stainless steel market.
Risk area
Macro-
economics
and steel
markets
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Metal price risks
Description
Outokumpu is exposed to price changes in alloy metals (such as chrome,
nickel, molybdenum and iron) for through, for example, purchase of raw
materials as well as the sale of stainless steel end products where the
price of alloy metals is based on market prices. The timing difference in
such commercial purchase and sale transactions as well as the inventory
position expose Outokumpu to metal price risk alongside our capability to
pass on price changes in raw materials to end-product prices. Changes in
ferrochrome market prices expose Outokumpu’s revenue from ferrochrome
sales to metal price risk.
Opportunities
•
Managing turning points of metal markets successfully reduces metal
price risk impacts on earnings, cash flows, and balance sheet structure.
•
End-to-end approach in metal price and margin steering ensures
alignment and consistent metal price risk mitigation from raw materials
to stainless sales.
Threats
•
Significant price level changes of alloy metals could have an impact on
profitability.
•
Changes in market and trading conditions at metal exchanges may have
adverse impacts on metal pricing and risk mitigation through hedging.
•
Fluctuation of revenue from ferrochrome sales due to changes in
ferrochrome market prices.
Outokumpu’s response
•
Steer metal price risk mitigation through the Financial Risk Steering
group and other steering groups.
•
Manage the metal margin in both raw material and stainless steel
pricing according to Outokumpu’s pricing policies and processes.
•
Hedge the nickel price risk according to Treasury Policy.
•
Mitigate risk through pricing decisions by including an alloy surcharge
clause in some of the stainless steel sales contracts, with the aim of
reducing the risk arising from the timing difference between alloy metal
purchase and stainless steel pricing and delivery.
•
Ensure that mitigating actions are conducted across functions, i.e. in
sales, raw material procurement, operations and supply chain
management and treasury.
Read more in note 5.3 in the financial statements.
Risk area
Raw
material and
energy
prices
Energy costs
Description
Outokumpu’s operations are energy intensive. The production of stainless
steel and ferrochrome requires significant amounts of energy, particularly
electricity, natural gas and, to a lesser extent, propane, and fuel oil. Energy
costs represent a substantial portion of Outokumpu’s total cost of sales
and hence Outokumpu is continuously striving to make its production
operations more energy and material efficient.
Opportunities
•
Enhancing cost competitiveness, innovation, and business resilience
through investments in energy efficiency improvement initiatives, and
programs across the Group.
•
Better control over energy costs by optimizing energy utilization and
avoiding electricity price peaks.
•
Improving energy efficiency accelerates the execution of our
decarbonization strategy.
Threats
•
Adverse geopolitical developments, such as escalating tensions in the
Middle East, the ongoing war in Ukraine, or extreme weather events,
could disrupt the energy market. As a result, Outokumpu's continued
high sensitivity to adverse geopolitical events exposes it to price risks
Outokumpu’s response
•
Innovate and implement energy efficiency investment initiatives and
measures throughout the organization.
•
Optimize production and maintenance periods to avoid an increase in
costs and to ensure profitability by daily activities.
•
Hedge the energy price risk with long-term agreements, fixed price
supply contracts, and partial ownership in power utilities.
•
Manage energy price risk centrally, complying with Energy Procurement
Policy, and energy steering cadence.
Read more about low-carbon energy and energy efficiency
Risk area
Raw
material and
energy
prices
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Dependency on critical machinery and suppliers
Description
Outokumpu’s stainless steel and ferrochrome production are dependent on
the continuous operation of critical production equipment. Production
downtime and disrupted operations may occur as a result of fire, natural
catastrophes, mechanical failures in production equipment, disruptions in
supply chain or supplier relationships. Critical supplier dependencies are
for example within electricity network partnerships, the supply of liquid
natural gas to our Tornio site in Finland, and hot rolling services to our
Calvert site in the US.
Opportunities
•
Focus on global operational risk management improves safety and
increases efficiency in production.
•
Stringent supplier qualification requirements and efficient supplier
relationship management improve supply chain resilience.
•
Continuous evaluation of dependencies and review of alternative plans
increase our ability to identify opportunities to further improve the
efficiency and resilience of our operations.
Threats
•
Natural catastrophes, fire or serious mechanical machinery breakdowns
could lead to major damage to property, business interruption or severe
accidents for personnel or contractors on site.
•
Supply chain disruptions could cause substantial interruptions to the
downstream part of our business.
Outokumpu’s response
•
Drive global Manufacturing Excellence and Asset management programs
to continuously improve our asset and equipment reliability and
maintenance.
•
Focus on loss prevention through a global loss prevention program with
regular site visits and close cooperation with our insurers.
•
Place appropriate insurances to secure the company against large
financial losses arising from insurable loss events.
•
Manage our supply chain by maintaining good visibility into the supply
chain and relationships with suppliers.
•
Review and implement alternative plans including partnering and
integration into value chain for securing the availability of critical
services and goods with contingency plans being developed and
updated.
Risk area
Operational
/ supply
chain
Low CO2 emission raw material availability
Description
Stainless steel production is dependent on several essential metal alloys.
CO2 material risks exist in all raw materials. The carbon footprint varies
depending on the raw material, its origin, production treatment etc. As we
move forward, the demand for low CO2 material will only grow creating
potential sourcing difficulties. As with all raw materials, Outokumpu aims to
ensure the supply chain complies with its stringent sustainable and
responsible sourcing values, including human rights and carbon emission
reduction
Opportunities
•
Maximization of using steel scrap as a raw material rather than primary
nickel, and the utilization of sustainable nickel ensures minimized
carbon footprint.
•
The emerging recycling industry, such as battery recycling, provides new
recycled raw material streams to increase scrap availability and diversify
scrap sources.
•
Partnerships around the value chain fosters joint innovations and
benefits across the supply chain by improving abilities to further reduce
CO2 emissions, lower costs through better predictability and drive waste
reduction.
Threats
•
Supply chain disruptions and limited alternatives could push towards the
use of high carbon footprint options which would negatively impact on
CO2 emissions, costs and supply chain sustainability.
Outokumpu’s response
•
Continuous discussions with suppliers enabling Outokumpu to maintain
its position as market leader in sustainable stainless steel
•
Manage long-term partnerships with strategic suppliers and expand
collaboration through value chain integration to secure sourcing and
retain the supply of high-quality and low-CO2 raw materials
•
Drive to retain the high scrap utilization level to limit the need for
primary raw materials.
•
Steer Inner Circle program to connect customers to scrap suppliers
which promotes the recycling of steel scrap and enhance circularity
Read more about fostering sustainable supply chain
Risk area
Operational
/ supply
chain
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Energy availability
Description
The availability of energy is critical for the continuity of Outokumpu’s
stainless steel and ferrochrome production. In addition to electricity, the
primary energy sources are natural gas, propane or other fuels such as
diesel. As part of its decarbonization strategy, Outokumpu is increasing the
share of low-carbon electricity, planning to switch to low-carbon fuels in
production and implementing energy efficiency initiatives to ensure energy
availability while remaining committed to the decarbonization target.
Opportunities
•
Focus on securing energy availability with low-carbon options can
contribute in decarbonization targets by reducing scope 1-3 emissions
•
Strengthening the independence of Outokumpu from fossil energy
improve business and operational resilience towards the lack of energy.
•
The focus on energy utilization could drive us to explore further
economic opportunities within energy markets and also embed a culture
of energy efficiency across the company.
Threats
•
Disruption in energy availability could lead to production limitations or
even temporary shutdowns.
•
Adverse geopolitical development such as escalated geopolitical
tensions, trade sanctions as well as extreme weather events could
disrupt energy market and even cause disruptions in the energy supply.
Outokumpu’s response
•
Continue to strive to make production operations more energy and
material efficient, prioritize investments related to energy efficiency.
•
Ensure diversified energy sources and suppliers by, for example,
increasing low-carbon energy like wind power.
•
Evaluate the feasibility of low-carbon electricity increase through
emerging nuclear technology, small modular reactors in Tornio.
•
Evaluate regularly the availability of electricity and energy gases for the
main countries in Europe by energy sourcing teams in order to plan and
adjust business decisions.
Read more about low-carbon energy and energy efficiency
Risk area
Operational
/ supply
chain
Cyber security
Description
Outokumpu relies on various applications, technologies and third party
solutions that are used globally and locally. A possible cyber security
breach could cause damage to our operations, assets, people or leaks of
sensitive information related to Outokumpu, its personnel or partners such
as customers and suppliers.
Opportunities
•
Cyber security visibility, analysis and improvement investments increase
transparency on the underlying synergies and efficiencies in all of
Outokumpu’s global and local environments in all assets.
•
Cyber awareness campaigns targeted at better cyber security
engagement, awareness and knowledge among Outokumpu’s
employees, employee families, suppliers and customers will also
improve the overall cyber security culture.
Threats
•
Outokumpu production facilities could face a sudden disruption, which
could cause delays in deliveries and, in severe cases, large business
losses as well as damage to our customer and supplier relationships.
•
Employee identities used in fraud cases, personal or confidential
information leaked outside the company could cause financial losses,
imposition of penalties, but also reputational harm.
•
A cyber attack could cause injuries to personnel or to our supply chain in
Outokumpu.
Outokumpu’s response
•
Continuous improvement of Outokumpu cyber security resilience to
ensure better business continuity through cyber threat intelligence and
cyber threat detection to notice any attacks to conduct proactive
prevention.
•
Enhance security operations capability for resilience and faster incident
response.
•
Ensure cyber practices implementation among Outokumpu suppliers.
•
Raise awareness of cyber threats by cyber security engagement
campaigns.
•
Continue improving cyber security global governance with cross-
functional co-operation for cyber security strategy implementation.
Risk area
Corporate
security
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Climate change
Description
Outokumpu has ambitious climate targets and is committed to limit global
warming to 1.5°C. Climate change presents both risks and opportunities for
Outokumpu. Risks are related to mitigation technologies and regulation,
whereas opportunities relate to increased demand for low-emission
stainless steel.
Opportunities
•
Demand for low-emission stainless steel is expected to grow
•
Being well positioned in the industry towards Carbon Border Adjustment
Mechanism (CBAM) and EU’s taxonomy alignment potential to create
competitive advantage
•
Circular economy embedded to the business enabling industry’s lowest
carbon footprint already currently
Threats
•
Increase in production costs due to new regulation after 2025 such as
through Carbon Border Adjustment Mechanism (CBAM).
•
Decarbonization technologies and investments would not be viable and
effective enough to meet emission reduction targets.
Outokumpu’s response
•
Committed to ambitious climate targets set in line with the Science
Based Targets initiative’s 1.5°C ambition of limiting global warming.
•
Decarbonization strategy execution through increasing recycled raw
materials, low-carbon electricity, energy efficiency, improvements in
operations and replacing fossil fuels with renewable alternatives
•
Targeted investments to biocoke and investigating carbon capture
•
Support customers in their emission-reduction targets with new low-
carbon solutions, such as the Circle Green, and transparent product-
specific carbon footprint data.
•
Embed emission reduction targets to our main loan facility and to
performance-based share programs.
Read more about climate change.
Risk area
ESG
People and safety
Description
Outokumpu aims to be the industry leader in safety with the vision of zero
accidents and continuously reduces the accident record year on year to
achieve this. Risks relating to our people also include the risk of not being
able to provide a healthy and inclusive working culture that can attract and
retain the best talents.
Opportunities
•
Sharing best safety practices globally creates opportunities to improve
safety in all our processes.
•
Safety leadership training improves management skills and ensure that
safety and mental health is maintained as a priority in the company.
•
Investments in our production lines, latest technologies and ways of
working upgrade our workplaces to ensure safe environment for our
employees and strengthens engagement.
•
Inclusive and diverse workforce ensures the best market understanding
and fosters innovation.
Threats
•
Risk of serious injuries and fatalities due to failure in high level safety
practices and culture.
•
Lack of adherence to ensure that safety standards are fully
implemented at every site across the company.
•
Inability to attract a skilled and diverse workforce.
Outokumpu’s response
•
Execute safety strategy to further improve safety performance, including
cross learning program and mental health roadmap to ensure alignment
with corporate policies and standards.
•
Take pioneering steps in utilizing the state-of-the-art-technology. Three AI
driven robots have been deployed in 2023 and 2024 and proof of
concept targeted for 2025 in Sweden, Germany and Finland
•
Established comprehensive roadmap to strengthen diversity, equity, and
inclusion with clear targets approved by Outokumpu’s Board of
Directors.
•
Provide a communication channel, SpeakUp, enabling Outokumpu
employees and external stakeholders to report breaches of
Outokumpu’s Code of Conduct and other misconduct.
Read more about safety, our people, and ethics and compliance.
Risk area
ESG
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Sustainable sourcing
Description
Outokumpu is part of a global supply chain, including raw material, services
and other material suppliers worldwide. Sustainable sourcing, with the
process of selecting and managing suppliers, is critical across all
purchases, especially in raw material sourcing. Outokumpu is exposed to
risks related to for example sourcing in countries with high sustainability
risk and dependencies on certain critical suppliers.
Opportunities
•
Exceeding customer expectations by providing traceable and responsible
value chain, to foster human rights and accelerate the green transition.
•
Resilient supply chain and effective due diligence can prevent
disruptions, reduce operational costs and differentiate the company
•
Supporting our suppliers towards more sustainable operations and
eliminating any environmental or social harm, across the stainless-steel
value chain, to foster human rights and accelerate green and just
transition
Threats
•
Causing, contributing or being linked to social or environmental harm in
our supply chain
•
Competition over needed sustainable materials could increase costs or
sourcing in high- risk countries
•
Non-compliance with different new supply chain regulations in Europe
and the US
Outokumpu’s response
•
Sustainable sourcing is one of the strategic focuses in our sustainability
strategy
•
Supply chain activities are guided by the United Nations Guiding
Principles (UNGP), which principles are integrated into our Supplier Code
of Conduct, Supplier Requirements and Human Rights Policy
•
Strong steering through established supplier sustainability team
including supply chain risk management.
Read more about the sustainable supply chain.
Risk area
ESG
Outokumpu Annual Report 2024
285
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Remuneration report
The principles of remuneration include shareholder value creation, competitive remuneration, incentives aligned
with business strategy, and pay for performance. Sustainability targets are included in our incentive plans.
Outokumpu Annual Report 2024
286
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Introduction
This report has been prepared according to the Finnish Corporate Governance Code 2020
and approved by the Board of Directors. It will be presented to the Annual General Meeting
in April 2025.
The report presents how Outokumpu rewarded the Board members and the President and
CEO for 2024. The materialized remuneration is in line with the Remuneration Policy of the
governing bodies of Outokumpu, approved at the Annual General Meeting in 2024.
Outokumpu’s Annual General Meeting on April 4, 2024 approved the remuneration report
2023 in an advisory vote. Approximately 98% of the votes cast were in favour of the
remuneration report. In this remuneration report 2024, we continue the solid remuneration
disclosure practice established earlier, and in addition provide more details regarding the
impact of the CEO change on 2024 remuneration.
In 2024, the Annual General Meeting re-elected the same Board members as in 2023.
However, Kati ter Horst stepped down as Vice Chairman to assume the role of President
and CEO of Outokumpu. Her position in the Board was not filled, resulting in the Board
continuing without a Vice Chairman and operating with seven members instead of eight as
of October 1.
For 2024, the CEO remuneration was in line with the framework and principles set forth in
the Remuneration Policy. The remuneration of the employees follows the same principles,
which include shareholder value creation as the underlying focus of the reward strategy,
competitive remuneration, business strategy aligned incentives, and pay for performance.
In line with this last principle, no short-term incentives will be paid to management in 2025
for 2024 because of weak financial results.
Sustainability in all its aspects continues to be at the core of our operations. Safety has
been a target in all short-term incentive plans, including for the CEO, for many years. Since
2023, diversity has also been included as a target in the short-term incentive plan for top
leaders, though it does not apply to the CEO. CO2 emission reduction also remained a key
target in our long-term incentive program, the Performance Share Plan, in which the CEO
and close to 200 leaders participate.
Going forward, we will continue to review our remuneration framework to ensure it supports
value delivery for all our stakeholders.
Performance and remuneration trends 2020–2024 from 2019 baseline
Adjusted EBITDA
Net cash generated from operating activities
Board of Directors remuneration
CEO remuneration
Average salaries and wages
2019
2020
2021
2022
2023
2024
—%
50%
100%
150%
200%
250%
300%
350%
400%
450%
500%
Development of financial performance and remuneration
2024
2023
2022
2021
2020
Adjusted EBITDA 1), € million
177
517
1,256
980
250
Net cash generated from operating
activities, € million
147
325
778
597
322
Board of Directors 2), €
947,840
917,501
898,200
780,600
658,400
CEO 3), €
2,294,423 2,603,709 1,965,022
795,840 1,264,729
Employee average 4), €
63,879
62,152
66,013
62,677
53,637
Ratio CEO/employee average
36
42
30
13
24
1) 2020 includes discontinued operations.
2) Total remuneration paid to the Board of Directors, including annual remuneration and meeting fees for all
members.
3) Total remuneration paid to the CEO, including salary, employee benefits and incentives, for Roeland Baan
from January 1, 2020 to May 15, 2020, for Heikki Malinen from May 16, 2020 to September 30, 2024
and for Kati ter Horst from October 1, 2024.
4) Personnel expenses without indirect employee costs and termination benefits, divided by the average
number of employees during the year. In 2020, the employee headcount was used for the calculation. From
2021 onwards, the calculation is based on full-time equivalent (FTE).
Outokumpu Annual Report 2024
287
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Fees of the Board of Directors
Outokumpu’s Board members are compensated for their time, commitment, knowledge,
and required experience for contributing to the long-term financial performance and
success of the company. In 2024, the composition of the Board remained unchanged
except for Kati ter Horst who left the Board on September 30, upon her becoming President
and CEO of Outokumpu.
Observing general market trends and in accordance with the proposal by the Nomination
Board, the Annual General Meeting 2024 decided to increase the remuneration of the
Board of Directors as presented in the table below.
40% of the annual remuneration is paid in the company’s own shares using treasury shares
or shares to be purchased from the market at a price formed in public trading and in
accordance with the applicable insider regulations.
If a Board member, on the date of the Annual General Meeting, owns shares of the
company, which based on the closing price of that day represent a value exceeding the
annual remuneration, he or she can opt to receive the remuneration in cash.
The annual fee is paid once a year, and in addition to the annual remuneration, all the
members of the Board of Directors are paid a fee for each meeting they attend. The
members of the Board are not entitled to any other share-based rewards. The Board
members are not eligible for any pension schemes.
Set fees of the Board of Directors
2024
2023
€
Annual remuneration
Meeting fee
Annual remuneration
Meeting fee
Chairman
180,000
800
174,000
800
Vice Chairman
96,500
800
93,500
800
Board members
75,000
800
72,500
Meeting held in the
country of residence
800
800
Meeting held outside
the country of residence
1,600
1,600
Board of Directors’ remuneration and meeting fees paid in 2024 and 2023
Paid in 2024
Annual compensation
Members of the Board of Directors
Share portion
Cash portion
Meeting fees1)
Total
Kari Jordan, Chairman
0
180,000
22,640
202,640
Kati ter Horst, Vice Chairman 2)
0
96,500
24,000
120,500
Heinz Jörg Fuhrmann, Member
30,446
44,554
28,800
103,800
Päivi Luostarinen, Member
30,446
44,554
16,800
91,800
Jyrki Mäki-Kala, Member and Chairman
of the Audit Committee
39,179
57,321
16,800
113,300
Petter Söderström, Member
30,446
44,554
16,800
91,800
Pierre Vareille, Member
30,446
44,554
32,000
107,000
Julia Woodhouse, Member 3)
30,446
44,554
42,000
117,000
Total
191,409
556,591
199,840
947,840
1) Meeting fees are entered in the table on the year when they are paid and include committee meeting
fees and tax on benefits/gifts.
2) Vice Chairman until September 30, 2024.
3) Meeting fees include 14,000€ meeting fees for the ESG (environmental, social and governance) Board
Paid in 2023
Annual compensation
Members of the Board of Directors
Share portion
Cash portion
Meeting fees1)
Total
Kari Jordan, Chairman
0
174,000
18,886
192,886
Kati ter Horst, Vice Chairman
0
93,500
26,750
120,250
Heinz Jörg Fuhrmann, Member
29,458
43,042
21,843
94,343
Päivi Luostarinen, Member
29,458
43,042
20,625
93,125
Jyrki Mäki-Kala, Member and Chairman of
the Audit Committee 3)
37,996
55,504
12,800
106,300
Petter Söderström, Member
29,458
43,042
19,202
91,702
Vesa-Pekka Takala, Member 3)
0
0
7,614
7,614
Pierre Vareille, Member
29,458
43,042
25,338
97,838
Julia Woodhouse, Member 4)
29,458
43,042
40,943
113,443
Total
185,286
538,214
194,001
917,501
1) Meeting fees are entered in the table on the year when they are paid and include committee meeting
fees and tax on benefits/gifts.
2) Appointed as a Board member on March 30, 2023.
3) Board member until March 30, 2023.
4) Meeting fees include 10,500€ meeting fees for the ESG (environmental, social and governance) Board.
Outokumpu Annual Report 2024
288
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Remuneration of the CEO
The remuneration of the CEO consists of a base salary, benefits and an annually
determined short-term incentive plan. In addition, the CEO participates in long-term
incentives comprising performance share plans launched on a yearly basis.
Heikki Malinen’s base salary and incentive earning opportunity remained unchanged during
2024, but a supplementary pension plan was added to his remuneration package for EUR
200,000 yearly. He resigned on May 2 and his last day as a President and CEO was
September 30. Consequently, no incentive will be paid out in 2025 based on the
performance in 2024 and earlier. Heikki Malinen however received a short-term incentive
for 2023 results and a share reward based on the performance from 2021 to 2023.
Kati ter Horst’s base salary is EUR 850,000 annually, including benefits. She is also
entitled to a gross travel and housing allowance of EUR 80,000 per annum, and has a
supplementary pension plan for EUR 170,000 yearly. Her regular incentive levels (in
percentage of salary) are the same as they were for Heikki Malinen. Additionally, she
received a sign-on bonus of EUR 106,250 and a grant of 150,000 restricted shares (gross)
to be delivered in 2025, 2026 and 2027, in recognition of lost incentives from her previous
assignment.
The service contract of the CEO is valid until further notice. The notice period was 6 months
for Heikki Malinen, but is extended to 9 months for Kati ter Horst. For the company, the
notice period remains 6 months, and the severance payment in such a case also stays 12
months. Kati ter Horst’s retirement age is 65 years, like it was for her predecessor. Besides
the supplementary pension plan specified above, she participates in the Finnish statutory
pension system, like was Heikki Malinen’s case.
Remuneration paid to the CEO
EUR
2024 (Kati ter Horst)
2024 (Heikki Malinen)
2023 (Heikki Malinen)
Base salary 1)
232,440
723,810
986,190
Short-term incentives 2)
106,250
515,755
871,388
Long-term incentive 2)
0
507,097
729,208
Benefits 3)
42,560
166,511
16,923
Total remuneration
381,250
1,913,173
2,603,709
1) Heikki Malinen until September 30, 2024, Kati ter Horst as of October 1, 2024.
2) Incentives are entered in the table for the year when they are paid. Short-term incentives are typically
earned during the previous year, however, in 2024, Kati ter Horst's short-term incentive was a sign-on
bonus. Long-term incentives are earned during the previous three years.
3) Benefits include telephone, car and supplementary pension but exclude insurances and statutory pension.
CEO realized pay mix
72%
47%
39%
28%
27%
34%
27%
28%
Base salary and benefits
Short-term incentive
Long-term incentive
2024 (Kati ter Horst)
2024 (Heikki Malinen)
2023 (Heikki Malinen)
Short-term incentive of the CEO
In 2024, the CEO’s short-term incentive earning opportunity stayed unchanged at 50% of
the annual gross base salary on a target level and 100% on a maximum level.
Short-term incentive earning opportunity (Heikki Malinen)
EUR
% 1)
€
Threshold
0.5 %
4,750
Target
50 %
475,000
Maximum
100 %
950,000
1) Percentage of annual base salary.
Short-term incentive performance measures and outcome (Heikki Malinen)
In 2024, adjusted EBIT fell below the threshold set in the short-term incentive plan. The
plan therefore will not pay out, despite other targets being met.
Performance measures
Weight
Outcome
Outcome in %
Payout, €
Safety (TRIFR) 1)
10 %
1.5
100 %
0
Adjusted EBIT, million €
70 %
-43
— %
0
Strategy implementation (score 1–5) 2)
20 %
N/A
N/A
0
Total
100 %
N/A
0
1) Total recordable injury frequency rate. Despite reaching maximum performance, the pay-out would have
been zero for the CEO because of a contractor fatality that occurred in Mexico in January 2024.
2) Discretionary assessment of strategy phase two implementation and delivery of projects that are key for
Outokumpu’s future. Not rated in 2024 due to significant negative changes in the market.
Outokumpu Annual Report 2024
289
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Long-term incentives and shareholding of the CEO
In 2024, the long-term incentive target and maximum levels remained at 50% and
respectively 75% of the annual base salary at time of grant. The Performance Share Plan
(PSP) 2022–2024 partly met its performance criteria and the executives participating in
the plan will receive in 2025 85.4% of the shares granted at target level. The CEO will not
however receive this reward, since Heikki Malinen resigned and Kati ter Horst did not
receive a grant under this plan.
Long-term incentive earning opportunity
RSP 2024–2026
(Kati ter Horst)
PSP 2024–2026
(Kati ter Horst)
PSP 2023–2025
(Kati ter Horst)
PSP 2022–2024
(Heikki Malinen)
PSP 2021–2023
(Heikki Malinen)
Threshold 1)
_
25 %
25 %
25 %
25 %
Target 1)
_
50 %
50 %
50 %
50 %
Maximum 1)
_
75 %
75 %
75 %
75 %
No of shares
granted (gross) 2)
150,000
78,900
43,100
85,300
168,800
Grant date
2/10/2024
2/10/2024
2/10/2024
15/3/2022
15/3/2021
No of shares
earned (gross)
0
123,730
No of shares
delivered (net)
0
64,608
Share delivery
date
Vesting 1 by
31/03/2025
Vesting 2 by
31/03/2026
Vesting 3 by
31/03/2027
By
31/03/2027
By
31/03/2026
_
21/02/2024
Share price at
delivery, €
_
4.10
Value of the
reward (gross), €
0
507,097
1) In percentage of annual base salary at the time of grant. Pay-out levels in percentage of annual base
salary at the time of payment may differ, depending on salary and share price development. In PSP
2023-2025 and 2024–2026 the levels were prorated to time in position during the performance period.
2) Number of gross shares at target level. For PSP plans, the number of shares was determined using the
average share price of 90 calendar days prior to Board approval.
Long-term incentive earning performance measures
PSP 2024–2026
PSP 2023–2025
PSP 2022–2024
Return on capital employed
Weight
80 %
80 %
80 %
Measurement
Average of 2024,
2026 and 2026
Average of 2023,
2024 and 2025
Average of 2022,
2023 and 2024
Outcome
8.8% = 69% pay-out
CO2 emission per ton crude steel
Weight
20 %
20 %
20 %
Measurement
SBTi target 2026
(1.46)
SBTi target 2025
(1.52)
SBTi target 2024
(1.58)
Outcome
1.42 = 150% pay-out
Total outcome (weighted average)
85.4 %
The members of Outokumpu’s Leadership Team, including the CEO, are expected to own
Outokumpu shares they receive in the company’s share-based incentive programs
corresponding to at least the value of their annual gross base salary. Half of the net shares
received from the share-based incentive programs must be used to fulfil that ownership
recommendation.
Shares owned by the CEO
On December 31
2024 (Kati ter Horst)
2023 (Heikki Malinen)
Number of shares owned
39,609
117,361
Closing share price, €
2.905
4.484
Value of the shares, €
115,064
526,247
Value of the shares in % of annual base salary
14 %
55 %
Outokumpu Annual Report 2024
290
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Information for investors
Engaging with shareholders
Outokumpu’s share is a so-called people’s share in Finland, with households and private
investors owning approximately a quarter of its outstanding shares. The largest shareholder
is Solidium Oy, the Finnish-state owned investment company, which owned 15.5% of the
outstanding shares at year-end. The share of international institutions’ ownership
decreased during the year and was 19.11% at the end of 2024.
Outokumpu has a strong focus on shareholder returns and according to its dividend policy,
aims to distribute a stable and growing dividend to be paid annually. In 2024, we
distributed a total of EUR 110 million as dividends for year 2023, EUR 0.26 per share.
Second share buyback program
In 2024, we completed the second share buyback program in our history. The program
started already in December 2023 and under the program, Outokumpu repurchased 11
million of its own shares and used approximately EUR 46 million for the share repurchases.
Part of these repurchases occurred already in 2023. Through the share buyback programs,
Outokumpu seeks to mitigate and manage the dilutive impact of the company’s
outstanding convertible bonds.
Regular and active communication with investors
Outokumpu continued its regular and active communication with investors and analysts
throughout the year. Key topics in 2024 were the next phase of Outokumpu’s strategy,
capital allocation, shareholder returns, challenging market environment, management
changes, sustainability, and decarbonization.
During the year, Outokumpu participated in seven conferences or roadshows, where
management met investors in one-on-one or small group meetings. On top of that, we
arranged four breakfast seminars for Finnish institutional investors after every quarterly
result and four pre-silent conference calls hosted by the CFO, open for everyone to attend.
We also arranged a site visit to our Kemi mine for institutional investors, analysts, and
bankers in September. Additionally, we arranged four breakfast events for analysts in
Helsinki and London to introduce the new CEO and CFO of Outokumpu.
The Annual General Meeting 2024 was held on April 4, 2024, at the Clarion Hotel Helsinki
in Helsinki, Around 300 participants attended the meeting, and altogether more than 700
shareholders participated either by attending or voting in advance. Before the Annual
Outokumpu Annual Report 2024
291
Outokumpu’s
shareholders
listening to the
CEO’s and CFO’s
interview before
the Annual General
Meeting 2024.
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
General Meeting, we also arranged an event, where then CEO Heikki Malinen and CFO Pia
Aaltonen-Forsell were interviewed about current topics and there was also a possibility to
directly ask questions.
Share price and trading in 2024
In 2024, Outokumpu’s share price was EUR 4.29 at its highest and EUR 2.79 at its lowest
(2023: EUR 5.90 at its highest and EUR 3.60 at its lowest). The share price closed at EUR
2.91 at the end of year 2024, and decreased by 35% from the closing price of EUR 4.48
at the end of 2023. The market capitalization was EUR 1,327 million at the end of the
year, compared to the level of EUR 2,048 million at the end of 2023.
During 2024, the average daily trading volume in Outokumpu shares on Nasdaq Helsinki
was 1,5 million shares. 385 million Outokumpu shares were traded in total on Nasdaq
Helsinki during the year (2023: 386 million shares).
Outokumpu’s shares are listed on the Nasdaq Helsinki Large Cap list under the trading
code OUT1V and incorporated into the Finnish book-entry securities system. Outokumpu’s
shares are also traded on various alternative platforms.
Principal shareholders at the end of 2024
Shares
%
Solidium Oy
70,793,208
15.50
Varma Mutual Pension Insurance Company
24,888,403
5.45
Ilmarinen Mutual Pension Insurance Company
15,360,000
3.36
The Social Insurance Institution of Finland
8,388,652
1.84
State Pension Fund
8,000,000
1.75
Elo Mutual Pension Insurance Company
6,739,000
1.48
Mandatum Life
6,125,327
1.34
OP Life Assurance Company Ltd.
5,856,308
1.28
Nordea Life Assurance Finland Ltd.
3,586,799
0.79
Oy Etra Invest Ab
2,500,000
0.55
Etola Erkki Olavi
2,000,000
0.44
Sinituote Oy
1,588,560
0.35
Laakkonen Mikko Kalervo
1,406,000
0.31
Säästöpankki Kotimaa - Equity Fund
1,291,975
0.28
Ojala Alpo Armas
1,285,860
0.28
Helander Hannu-Jukka
1,261,500
0.28
Brotherus Ilkka Johannes
1,200,000
0.26
Danske Invest Finnish Equity Fund
1,078,667
0.24
Seligson & Co Equity Fund
1,065,896
0.23
Insurance Company Fennia Life
1,013,464
0.22
Total
165,429,619
36.23
Nominee accounts held by custodian banks
87,286,559
19.11
Treasury Shares
33,188,820
7.26
Other Shareholders
170,969,450
37.40
Total
456,874,448
100.00
Outokumpu Annual Report 2024
292
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Shareholders by group on December 31, 2024
19.5%
34.6%
15.5%
30.3%
Nominee registered and non-Finnish holders
Finnish institutions, companies and foundations
Solidium Oy
Households
Solidium Oy is wholly owned by the Finnish state Source: Innovatics
Market capitalization and share price development
Month-end market capitalization, €/ million share
Monthly average price, €/ share
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
.00
2.00
4.00
6.00
0
1
1
2
2
Outokumpu share price development in 2024
Outokumpu
Nasdaq Helsinki
Jan
Jan
Mar
Apr
May
Jun
Jul
Aug
Sept
Oct
Nov
Dec
40
60
80
100
120
140
Monthly trading volume, million shares
Jan Feb Mar Apr May Jun
Jul Aug Sep Oct Nov Dec
0
10
20
30
40
50
Dividend/share, €
Dividend per share
Extra dividend
2018
2019
2020
2021
2022
2023
2024
0.00
0.05
0.10
0.15
0.20
0.25
0.30
0.35
For 2024, dividend is a proposal by the Board of Directors. In 2022,
the dividend included a one-time extra of EUR 0.10 per share for the
exceptionally good result of the account period.
Outokumpu Annual Report 2024
293
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Annual General Meeting 2025
Outokumpu’s Annual General Meeting will be held on Thursday, April 3, 2025 at 1.00 pm
EEST in the Congress Wing of Finlandia Hall, at the address Mannerheimintie 13 E, 00100
Helsinki, Finland. The reception of persons who have registered for the meeting and the
distribution of voting tickets will commence at 10.30 am EEST. Shareholders of the
company can exercise their right to vote also by voting in advance. Shareholders, who have
registered for the meeting have the possibility to follow the Annual General Meeting via a
webcast.
The meeting language of the Annual General Meeting will be Finnish. There will be
simultaneous translation in English at the meeting.
Notice of the meeting and more information at www.outokumpu.com/en/agm2025.
Representatives of the company management
available before the meeting
Before the Annual General Meeting, from 11.00 am to 12.30 pm EEST, the President and
CEO as well as the President for Business Area Ferrochrome of the company will be
available at Finlandia Hall at a discussion event organized by the company. The event is not
part of the Annual General Meeting, and its presentation language is Finnish. Simultaneous
translation into English is also available. In connection with the event, participants can
present questions, but the event will not be a decision-making forum. Questions presented
at the event are thus not questions referred to in Chapter 5, Section 25 of the Finnish
Companies Act.
Important dates
February 13, 2025: Notice to the Annual General Meeting published.
February 14, 2025: Registration for the AGM started at 10.00 am EET.
March 6, 2025: Advance voting starts at 10.00 am EET.
March 24, 2025: Record date of the AGM.
March 27, 2025: Registration and advance voting end at 4.00 pm EET.
April 3, 2025: Annual General Meeting at 1.00 pm EEST.
April 7, 2025: Proposed dividend record date for the first instalment.
April 14, 2025: Proposed dividend payment date for the first instalment.
October 15, 2025: Proposed dividend record date for the second instalment.
October 22, 2025: Proposed dividend payment date for the second instalment.
Outokumpu Annual Report 2024
294
Annual review
Financial year 2024
Governance and remuneration
Corporate Governance Statement 2024
Risk management
Remunation Report
Information for investors
Working towards a world
that lasts forever
We believe in a world that is efficient, sustainable, and
designed to last forever. The world deserves innovations that
can stand the test of time and are ready to be born again at
the end of their life cycle. Stainless steel is vital in enabling
a sustainable world with economic prosperity.
Outokumpu Oyj
Salmisaarenranta 11
FI-00180 Helsinki, Finland
Tel. +358 9 4211
corporate.comms@outokumpu.com
www.outokumpu.fi
@Outokumpu
Outokumpu Group
Outokumpu