Materiality Analysis of sustainable growth elements

To optimise calibration of the commitment that Pirelli dedicates to sustainable growth issues, the Company has conducted a sophisticated stakeholder engagement activity. This involved comparing the expectations of the principal stakeholders of Pirelli on these issues with the relevant importance to business success..

Considering the complexity of Company stakeholders, their dispersal around the world and thus the variety of their expectations, this report has been prepared according to the “comprehensive” approach set out in the GRI-G4 Reporting Guidelines. This is to guarantee all stakeholders complete information about the sustainability elements that each of the categories has found in different ways to be more or less significant. The materiality analysis of the strategic issues of sustainable growth have resulted in Pirelli asking for the opinion of its own stakeholders at the international level, considering their level of interest in the Company and vice-versa, and identifying them with the support of the Group departments with which the Pirelli Sustainability and Governance Department interfaces every day. The panel of Company stakeholders who have been asked to give feedback have included:

  • the biggest original equipment customers;
  • hundreds of end customers for each representative market;
  • the most important dealers worldwide;
  • numerous employees who work in the various nations where the Group has a presence;
  • the biggest suppliers (in terms of sales to Pirelli) in each procurement category;
  • the principal shareholders, investors and financial analysts of Pirelli;
  • national and supranational institutions and public administrations;
  • Journalists from domestic and international newspapers;
  • NGO present in each of the countries where Pirelli has productive activities;
  • Universities located in each of the countries where Pirelli has productive activities.

The stakeholders were engaged through a request – made in their local language – to assign an action priority to the following ESG themes, according to their expectations on Pirelli:

  • product energy efficiency: commitment to reduce the tyre rolling resistance during use; this allows fuel savings and reduction of CO2 emissions in the environment;
  • process energy efficiency: commitment to reduce the energy consumption of the tyre manufacturing process; this makes it possible to reduce CO2 emissions into the environment;
  • renewable energy: commitment to introduce the use of renewable energy in the tyre manufacturing process; this makes it possible to reduce CO2 emissions into the environment;
  • water management: commitment to reduce water consumption in the tyre production process, so as to minimise the impact on water resources;
  • waste management: commitment to reduce the production of waste in the tyre production process, while simultaneously reusing and recycling waste products;
  • product safety: commitment to improve tyre safety performance, particularly in the most critical use situations, such as cold, wet, snow and other conditions;
  • responsible management of the supply chain: application of procedures that require suppliers to comply with social responsibility, environmental and business ethics rules and policies; monitoring of supplier performance in this regard;
  • compliance: company commitment to full compliance with local and international laws, regulations, procedures and guidelines;
  • evolution of sustainable mobility: capacity of the Company to have a long-term vision (2030-2050), to anticipate market expectations and swiftly adapt its own business to the evolution of sustainable mobility;
  • biodiversity: collaboration with the local communities in what are considered “protected” areas to preserve and improve local biodiversity;
  • sustainable human resources management: the Company’s commitment to constantly improving job conditions, such as health and safety, training and development, and remuneration;
  • human rights governance: commitment by the Company to respect and support human rights, to prevent and manage the risk of negatively impacting human rights that might result from its own activities;
  • business citizenship: commitment by the Company to support local communities through social support projects and the commitment to build and maintain positive relationships with institutions and non-governmental organisations;
  • management of diversity and equal opportunities: commitment by the Company to guarantee equal opportunity at the workplace and to develop diversity as a business tool;
  • customer satisfaction: commitment by the Company to assure maximum customer satisfaction, through the excellence of its products, customer relations and offered services;
  • research, development and product innovation: commitment by the Company to invest in research, development and innovation as key to long-term success;
  • transparent and complete reporting: transparency of the Company in giving clear and complete reports on its own financial, social and environmental performance and the related targets.

The priorities expressed by Pirelli and its stakeholders were then consolidated and and visualized in a mapg, on a matrix whose vertical axis indicates the expectations of external stakeholders, while the horizontal axis indicates the importance assigned by the Company to the analysed elements for the success of this business.

Finally, the draft map was submitted for assessment by an independent third party that is a leading ESG (Environmental, Social and Governance) analysis firm. The ESG Independent Analysts have compared the Pirelli draft map results with the contents of the ten international studies they considered as the most significant and trustworthy ones among those focused on Auto Components sector materiality, evaluating the prioritization level attributed to the different ESG themes. The results of this analysis, together with their own International ESG experience, allowed Analysts to suggest little changes to the position of some issues in the Pirelli draft map.

The result of the whole process above described is the following Pirelli Materiality map:



The map shows an high concentration of sustainability elements in the upper right quadrant that indicate those issues deemed fundamental by the parties involved.A low degree of materiality then concerns the themes in the lower left quadrant.

The “diagonal line” that results from the mapping of the sustainability factors is extremely important, insofar as it indicates the level of consistency between the vision of Pirelli and its stakeholders. Finally, the the substantial alignment with stakeholder expectations results in the targets of the Sustainability Plan 2014-2017 with Vision 2020 that the Company has adopted.