Sustainability Scorecard

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A. Customer satisfaction
It is ultimately the customer who assesses our performance and we gauge our customer satisfaction based on a broad market perspective that covers 44 independent studies in 11 of Volvo Cars’ most significant markets. During 2010, we noted declining figures in the number of independent customer sur¬veys in which Volvo Cars was ranked among the five top car brands, and thus during the year we also began to analyse the results and established goals of our work to improve the company’s customer satisfaction. Volvo Cars’ long-term goal is to be ranked among the five leading brands in independent market surveys.

B. Sales
Following two difficult years, Volvo Cars reversed the negative trend and raised its sales 11.6 percent compared with 2009. Overall, Volvo Cars sold 373,525 vehicles during the year. In China, sales rose 36.2 percent and in Northern Europe by 29 percent. In the key US market, however, the downward trend continued, with Volvo Cars selling 7,474 fewer cars than in 2009, representing a decline of 12.2.

C. Product safety
Volvo Cars’ vision is a completely accident-free traffic environment and the goal for 2020 is that no one is killed or injured in a new Volvo car. To attain this vision, Volvo Cars is continuing its lengthy research tradition and its efforts to strengthen safety in and around its cars to achieve a safer driver environment and a collision-free future. Each year a large number of inde¬pendent safety tests are conducted and Volvo Cars’ objective with these tests is to be among the very best in its class. In 2010 Volvo Cars gained the top ranking in 59 of 67 tests completed, which corresponds to 88 percent of the tests. This represents an improvement of 8 percentage points compared with 2009 (when 56 tests were completed).

D. Employee health and safety
Volvo Cars’ work environment directive describes our work environment policy. One of Volvo Cars’ objectives is to attain world-class status in terms of employee health and safety. Sickness absenteeism among Volvo Cars’ work¬force in Sweden and Belgium has declined steadily in recent years. During 2010, Volvo Cars attained the lowest level to date for sickness in the com¬pany, namely, 4.5 percent. Also, the company is continuing to monitor work-related accidents carefully and follows up all injuries in a bid to achieve improvements and avoid future accidents. During 2010, the company achieved a result of 0.6 LTCR (number of injuries resulting in at least one day of sick¬ness absenteeism per 200,000 hours worked), which is actually very close to the 2009 level and lower than a year earlier.

E. Supplier chain and human rights
During the period 2003 to 2010, Volvo Cars participated in Ford Motor Com¬pany’s global programme for the training and review of direct materials suppli¬ers. Consequently, the reported data currently show the reviews conducted through Ford Motor Company. Since the change ownership of Volvo Cars in the mid-2010 financial year, work aimed at developing new processes has been in progress. A new code of conduct was prepared during the year with guidelines that also apply to suppliers and a supplier portal was developed and launched in 2011. In addition, the company also completed internal training programmes focused on responsibility specifically aimed at the purchasing department.

F. Fuel efficiency and alternative fuels
Volvo Cars’ environmental programmes and its focus on the development of powertrains to reduce carbon-dioxide emissions are yielding results. The aver¬age emission levels for the company’s car models in the EU declined from 173 to 157 grams of CO2 per kilometre and will continue to fall during the years ahead as a result of continuing product improvements. One objective that Volvo Cars is working toward is that carbon emissions for the entire fleet are adapted to the EU’s target of a maximum of 95 grams not later than 2020. Examples of efforts to achieve this objective are the current and future DRIVe models and the development of fuel-efficient technology. Looking ahead, the company’s ambitious electrification strategy is in focus, including a test fleet of C30 Electric and the introduction of plug-in hybrids on the market in 2012.

G. Environmental classification of products
During 2008 and 2009, information was presented regarding the proportion of cars sold that met the requirements of Euro 4. However, for 2010, Volvo Cars instead presents the proportion of cars sold that meet the more demanding requirements of Euro 5. The proportion of Volvo cars sold that met the require¬ments of Euro 5/ULEV during 2010 was 54 percent. ULEV is an abbreviation for Ultra-Low Emission Vehicle and is an environmental classification that applies in the US state of California and imposes more stringent emission requirements than Euro 5.

H. Production and environment
Volvo Cars has an overarching objective of continuously reducing total energy consumption and our goal is to be climate neutral. All purchased electric power used by Volvo Cars in Europe derives from certified hydropower. Heat¬ing, which derives mainly from district heating facilities, originates largely from waste heat and biofuel. During 2010, total energy consumption from direct and indirect energy utilisation increased. This was primarily due to the un¬commonly cold winter in Northern Europe and drastic rise in our demand for district heating. The increase in purchased energy for in-house consumption is mainly associated with more intensive vehicle production and the higher number of cars produced and sold. Overall energy consumption increased per vehicle to 1.61 MWh/vehicle in 2010, compared with 1.71 MWh/vehicle in 2009.

I. Supplier chain and environment
Environmental work undertaken by suppliers is a quality issue and Volvo Cars seeks to ensure that the suppliers conduct such programmes as methodically as possible. For 2010, the company elected to gauge this directly by means of a key metric that is defined as the proportion of 500 largest suppliers, based on the number of purchased articles that are ISO 14001 certified. The company reached 99.6 percent in terms of this metric.

DEFINITIONS

Customer Satisfaction, rankings

Percentage of independent surveys in which Volvo Cars was ranked in top three makes (%).
This Key Performance Indicator (KPI) indicates the number of customer satisfaction surveys in which Volvo Cars was ranked 1, 2 or 3 compared with its industry competitors. The indicator includes a total of 25 different surveys in 8 different countries: Sweden, Britain, Germany, Italy, France, Spain, USA and Japan.

Most of the surveys include the majority of Volvo models. Three to four different surveys were carried out in each country under the following headings:

1. Sales: Customer satisfaction with dealer performance when buying a car
2. Service: Customer satisfaction with dealer performance with regard to service and/or car repairs
3. Product, short time in service: Customer satisfaction with product quality after 3 months of ownership
4. Product, extended time in service: Customer satisfaction with product quality after 3 years of ownership

This KPI does not include all surveys monitored by Volvo Cars. Surveys are carried out in all of Volvo Cars' most important markets. In parallel with the surveys conducted by different independent institutes and bodies, Volvo Cars undertakes its own survey, Customer for Life, to monitor trends in customer satisfaction with regard to the quality of sales and service provided by dealers in the majority of Volvo's markets.

Customer for Life is used operationally to develop local improvements which, in turn, produce improved results in competitor surveys.

Employee satisfaction

1. Respect
2. Co-operation
3. Delegation/influence
4. Performance feedback
5. Internal information/communication
6. Confidence/performance orientation
7. Overall understanding
8. Goals
9. Individual development
10. Easily implemented
11. Planning/follow-up
Of these the first five are "key areas" and come in order of priority. The percentage of answers amounted to 85% (from 89% in 2006).

The answer options are:
“Yes – Definitely”
“Yes – Mostly”
“Neither yes or no”
“No – improvement are necessary”
“No – improvement are very necessary”
“Don’t know”

Total Sales

Number of cars sold worldwide is defined as “cars delivered to end customers”

Revenue – excl special items (million USD)

Figures refer to total income of Volvo Cars Corporation.

Profit Before Tax – excl special items (million USD)

Figures refer to Volvo Cars Corporation total revenue minus expenses before tax.

Safety test results

Figures refer to number of independent tests performed where Volvo cars were awarded the very highest ranking. A number divided with all independent tests performed. Independent refers to independent and non carmaker affiliated, institute or insurance company (such as EuNCAP, US NCAP, IIHS, HLDI, Folksam and Thatcham). The tests are based on crash testing in a well controlled environment at a certain speed, accident statistics and expert assessment.

Health

Occupational injuries

Gender Balance

Ratio of basic salary of women to men

Diversity

The answer options are:
“Yes – Excellent”
“Yes – Good”
“Neither good nor bad”
“No – improvement are necessary”
“No – improvement are very necessary”
“Don’t know”

This question was introduced in our annual Employee Attitude Survey as of 2004. In 2007 the question concerning diversity in the survey was changed, and is now addressing the working group instead of the company.

Total Workforce

Employee Turnover

Significant Suppliers Screened for Human Rights

Fuel Efficiency

Harmful emissions

The number of cars complying with Euro 5 and/or ULEV standards supplied to end customers, as a percentage of total sales of Volvo cars globally. In the EU, emissions from new cars are governed by statutory limits. From 2005, all new cars were required to comply with the following emission levels, as specified in the Euro 5 standard.
Limit (g/km); Emission reduction compared with 2000 (%)
Total hydrocarbons (THC) 0.1; 50
Carbon monoxide (CO) 1.0; 57
Nitrogen oxides (NOx) 0.06; 60 

Alternative fuels

Energy consumption in car production

In terms of cars produced, data were collected from the car production/assembly plants owned by Volvo Cars in Sweden, Belgium, Thailand and Malaysia with Göteborg (Sweden) and Ghent (Belgium) as the predominant locations. .
In terms of energy (MWh), the figures include both heating and electricity consumption. All energy consumption is expressed in MWh. The figures refer to actual energy consumption and data relating to heating have not been corrected to a standard year basis

Carbon dioxide emissions from car production

In terms of cars produced, data were collected from the car production/assembly plants owned by Volvo Cars in Sweden, Belgium, Thailand and Malaysia with Göteborg (Sweden) and Ghent (Belgium) as the predominant locations.

In terms of emissions, the figures are based on both heating and electricity consumption. The figures refer to actual emissions.

NOx emissions (tonnes)

SOx emissions (tonnes)

VOC (Volatile Organic Compounds) emissions from car production

In terms of VOC (Volatile Organic Compounds) emissions (kg), our cars undergo anti rust treatment and painting in our paint shops. The figures refer to emissions from both painting and anti rust treatment processes, and from cleaning of painting equipment.

Hazardous waste (tonnes)