Volvo AB

No leading practices were identified for this company.

No leading practices were identified for this company.

No leading practices were identified for this company.

No leading practices were identified for this company.

Volvo has set a target to reduce its scope 1 and 2 emissions by 50% by 2030 compared to 2019. The company also has a target to reduce its downstream scope 3 emissions by 40% by 2030, but this could not be assessed due to missing data. Volvo’s future scope 1 and 2 emissions are projected to decrease between 2024 and 2028. However, the lack of assessable targets for scope 3 emissions jeopardises the company’s opportunity to align with its 1.5°C pathway.

Volvo has conducted a scenario analysis to test its low-carbon transition plan based on three different climate scenarios, including a low-carbon economy scenario. However, the company can improve on this by defining the scope of its scenario analysis and expressing the results in quantitative terms. Volvo has not set a target to fully phase out its ICE vehicles sales, but it aims to reach a 35% EV sales share by 2030. To improve its credibility and substantiate the development of its low-carbon business activities, the company should report their profitability, current size, growth potential and deployment schedule.

Volvo discloses its total capital expenditure (CapEx) for 2023, but no evidence was found of the company publicly reporting the share of low-carbon CapEx. There is also no strong evidence on the company’s plans to increase its share of low-carbon vehicles. In 2023, Volvo invested USD 2.51 billion in research and development (R&D), with 39% of the total expenditure directed towards low-carbon vehicles and energy solutions. R&D expenditure on low-carbon vehicles and energies will be essential for Volvo to develop a low-carbon fleet.

Volvo demonstrates contradicting positions on climate policy. Although the company does not support or fund associations, alliances, coalitions, or think tanks with climate-negative positions, it has opposed greenhouse gas (GHG) emissions standards for vehicles in the EU and US. In a December 2022 letter to the EU Commission, Volvo opposed a 100% zero carbon dioxide (CO2) emissions target for heavy-duty vehicles (HDVs). Similarly, in June 2023, Volvo strongly opposed the US Environmental Protection Agency’s (EPA’s) proposed tightening of GHG standards for HDVs in 2027.

No evidence was found of the company’s commitment to social dialogue or of the categories of stakeholders the company engages with on a just transition. Furthermore, no evidence was found to demonstrate the company’s ongoing social dialogue and meaningful engagement with affected stakeholders.  No evidence was found of the company undertaking low-carbon transition planning to mitigate the social impacts of the transition on workers, affected stakeholders and its business relationships. Additionally, no evidence was found to demonstrate the company’s engagement in social dialogue and with stakeholders in its just transition planning.

No public commitment by the company was found stating its intention to create and support access to green and decent jobs as part of the low-carbon transition. Moreover, no evidence was found of the company’s actions to promote these jobs in a way that ensures gender balance and inclusion of vulnerable groups. Additionally, no relevant disclosure was found of the company’s assessment of employment dislocation risks.   The company discloses the actions it takes to provide reskilling and upskilling opportunities for workers and affected stakeholders. For instance, its corporate university provides adult learning opportunities and ensures employees get quality training. However, no relevant disclosure was found of the company embedding equality of opportunity for women and vulnerable groups in these actions. Furthermore, no evidence was found of the company having a process for identifying skills gaps for workers and affected stakeholders or a public commitment to help workers displaced by the transition to reskill or upskill.

No relevant disclosure was found to show if the company identifies impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to social protection. Additionally, no evidence was found that the company expects its business relationships to contribute to the social protection of their workers and affected stakeholders.  No relevant disclosure was found to show how the company identifies any misalignment of its lobbying activities with policies and regulations that support the just transition, nor of the measures it takes to address misalignment. Furthermore, no evidence was found that the company lobbies for policies and regulations for green and decent job creation; retention, education and reskilling; and social protection for workers.

The company commits to respecting human rights and the ILO fundamental rights at work. However, it can strengthen its disclosure on its human rights due diligence process and engagement with affected stakeholders.

The company commits to respecting worker health and safety and it discloses some information on collective bargaining and workforce diversity fundamentals. However, it can strengthen its disclosure on these subjects, as well as on its living wage and working hours practices. The company discloses at least one initiative on women’s empowerment but does not have something similar for gender equality.

The company commits to protecting personal data, but its privacy statement on data collection, sharing and access does not cover customer and employee data. The company does not disclose its global tax strategy or the corporate income tax it pays in each relevant jurisdiction. While it has a policy prohibiting bribery and corruption and includes corresponding clauses in its contracts with business partners, it is unclear if supplier relationships are reviewed or terminated for policy breaches. The company discloses lobbying expenditures, but its policy statement does not cover its lobbying approach, nor does it require third-party lobbyists to comply with the company’s engagement policies.