NLMK

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.

NLMK has disclosed a long-term emissions reduction target, yet it does not align with the Paris Agreement. The company should enhance the ambition of its targets to align with a 1.5°C pathway. Additionally, it should clarify the role, if any, that carbon capture or the use of carbon offsets will play in achieving the long-term target.

NLMK lacks evidence of a low-carbon transition plan. While the company operates scrap collection and processing facilities promoting circularity, its expansion plans for these activities remain unclear. Additionally, though it aims to significantly increase renewable energy use by 2030 through green procurement, it lacks concrete targets for this objective. The company must establish a time-bound action plan detailing its shift towards a low-carbon economy. This plan should include a clear commitment to the transition and specifics on investments in key decarbonisation technologies like EAF expansion or low-carbon business models.

NLMK invested USD 15.5 million in research and development (R&D) in 2021. However, the company does not disclose what proportion of its R&D expenditure was invested in low-carbon technologies. R&D expenditure on low-carbon technologies will be essential for NLMK to develop a low-carbon product portfolio and be successful in a low-carbon economy.​ In addition, the company does not report a clear commitment to expanding its EAF capacities, meaning that a significant reduction in its emissions intensity in the near future is unlikely.

While NLMK presently interacts with clients to reduce emissions, these efforts largely entail informing them about product carbon footprints and conducting educational campaigns on climate change impacts. The company should consolidate these initial efforts into a comprehensive client engagement strategy. This strategy should establish clear emissions reduction targets and address the majority of its scope 3 emissions.

NLMK has set a long-term target for reducing its emissions intensity from steel production. The company does not, however, back the ambition with concrete disclosure on low-carbon technology investments nor shifts to low-carbon energy sources.

NLMK has outlined specific short-term measures to reduce carbon dioxide emissions from its steel production operations. However, there is a lack of equivalent detail regarding long-term actions that would align with achieving the company’s goal of a 40% reduction in emissions intensity by 2050.

NLMK’s emissions intensity from steel production has decreased from 1.95 tonnes of carbon dioxide per tonne of crude steel in 2017 to 1.83 in 2022. However, the current annual emissions intensity reduction rate of 1.2% is insufficient for the company to achieve its target of 1.2 tonnes of carbon dioxide per tonne of crude steel by 2040.

In 2022, the share of renewable power in the company’s total electricity consumption increased from 5.14% to 5.39%. However, this amounts to only 0.43% of the company’s total energy use. There is no evidence that the company is currently channelling substantial investments in R&D for low-carbon technologies.

NLMK does not disclose a low-carbon transition plan. Although the company undertakes climate change scenario analysis, there is no evidence that it makes the results of this analysis publicly available in quantitative or in financial terms.

The company publicly discloses a commitment to engaging in social dialogue with workers and unions. However, no relevant disclosure was found regarding the categories of stakeholders it engages with on a just transition. Nor was there any evidence to show 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. No relevant disclosure was found of the company’s assessment of employment dislocation risks. The company discloses its actions to provide training and educational opportunities for workers and affected stakeholders. For instance, it offers targeted training for workers and for young talents. 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 the impacts of the low-carbon transition on social protection for workers and affected stakeholders, nor how it contributes to their 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, no evidence was found of the company’s process to identify, assess and mitigate salient human rights risks in its operations and supply chain. Moreover, no evidence was found of the company disclosing the stakeholders whose human rights have been affected by its activities. The company does, however, have a grievance mechanism available to workers and external stakeholders.

The company commits to respecting the health and safety of its workers and expects the same commitment from its business relationships. Additionally, it discloses that all employees are covered by collective bargaining agreements and provides some workforce diversity statistics, including the age and gender of its workforce by employee category. The company can, however, strengthen its disclosure on these subjects and other key decent work issues, including living wages and working hours.

The company commits to protecting personal data. Additionally, it has a policy prohibiting bribery and corruption, and it includes corresponding clauses in its business relationship contracts. The company also has a lobbying and political engagement policy, and it specifies that it does not make political contributions. However, no relevant disclosure on the company’s responsible tax practices was found in the public domain.