Risk assessment

Verdo’s transformation from black to green energy in district heating production began back in 2002, when the Randers CHP plant started gradual conversion from coal to biomass. Today, the CHP plant has reduced CO2 emissions by 99.3% compared to firing using coal, and continues to work towards the green transition.

Our sustainable biomass, which is used in our district heating production and also sold to our customers in both the private and commercial segments, is certified through schemes that support and ensure that we meet recognised and regulatory standards. To continue to ensure we procure our fuels sustainably, in 2021 we further systematised our procedures for using suppliers based on the new RE-II Directive, which entered into force on 1 July 2021.

The new RE-II Directive sets sustainability criteria and documentation requirements for wood industry waste products and other biomass used for energy purposes.

A significant part of Verdo’s business model is the sale of coal and technical carbon through our Norwegian-US subsidiary Carbon Partners Inc. Technical carbon is used, for example, in the alloy industry and in the manufacture of solar cells. We are keenly aware that the extraction and use of coal is not sustainable. We are therefore committed at the same time to taking responsibility in working towards the green transition of the industry and phasing out coal.

We have a values-based management foundation, and we strive to ensure all our employees follow internal standards and policies.

Responsible supplier management is an area in which we can see some risks of negative impacts on human rights and corruption. Over a number of years, we have had our suppliers in our Trading division commit to our Code of Conduct. We have not identified any specific risks in relation to human rights or corruption in 2021. This remains a focus area, and in 2021 we formulated a Code of Conduct which will apply to the whole Group. We will commence dialogue with our strategic suppliers on this in 2022.

Social conditions are impacted by low unemployment and difficulty finding suitable candidates for advertised positions. This means higher costs for outside recruitment agencies and loss of earnings due to unfilled positions. We will therefore focus in 2022 on employer branding and further optimising our internal recruitment processes, in order to attract more qualified candidates.

We can also achieve the right mix of resources among our employees through relevant continuing training. A risk in this respect is that the relevant continuing training needs are not identified and implemented. We have a process for either employee development talks (MUS) or group development talks (GRUS) that we follow when reporting in our HR system.

We saw a declining proportion of apprentices in 2021. Given that apprentices are a pathway to recruiting competent tradesmen, it is important that we have our pipeline. We are therefore seeking to recruit apprentices as broadly as possible. Failure to retain employees who can no longer work in a full-time position represents a risk of losing resources. Opportunities for reduced working hours, such as part-time positions or senior or flex jobs will therefore be evaluated in dialogue with the employee, job centre and immediate manager.