Yara's commitment was to implement its Creating Impact strategy to drive business decisions and govern its entire global operation creating and measuring shared value in its activities across all geographies, business units, and levels of its organization.
In 2014, this commitment made good progress. Yara's Board of Directors took part in a pilot workshop on Sustainability, made available by UN Global Compact LEAD, to enhance the Board's processing of Sustainability matters. The Board confirmed the company's decision to further develop its strategy processes to strengthen the organization's ability to capture future business opportunities found in a long term scenario analysis. This move formalized the Creating Impact thinking into the regular business strategy processes. Also in 2014, processes were initiated to improve the company's overall alignment with the updated strategic ambition. These processes include a review of the Yara Brand Strategy and its Employee Value Proposition.
Already fully aligned with the strategy, Yara's Innovation platforms continued delivering progress towards the company's three focus areas: finding business opportunities based on meeting major global challenges in the areas of food production, resource shortages, and environmental issues.
Yara has established several innovation platforms to drive business development and launch solutions and services: Emissions to Air, Water Scarcity, Resource Efficiency, and Coffee & Cocoa. In 2014, Yara grew its R&D organization around three core competency communities: Product and Application Development, Process Research, and Catalyst Systems. Two pilot facilities were launched to address key developments at the research center in Porsgrunn, Norway, and a new world class greenhouse has been opened at the Center for Plant Nutrition, Hanninghof in Dülmen, Germany.
The key deliverable was to complete the UN Global Compact case study of strategy development and implementation. This case study was completed ahead of schedule. It was published in November 2014 and can be found on UN Global Compact's website.
During 2014 they continued their engagement in the Baltic Sea Region, i.e. participating in the 16th Baltic Development Forum Summit and the 5th Annual Forum of the EU Strategy for the Baltic Sea Region, in Turku in May, as well as the conference 'Greener Agriculture for a Bluer Baltic Sea' taking place in Warsaw in September. Meanwhile, Yara organized a high level Baltic Sea conference in Kaschow, Germany, engaging with farmers, policy makers, and academia.
Under the goal of 'Feeding the Future', Yara also organized events in Denmark, Germany, and Finland, gathering farmers, farmers' organizations, policy makers, and other stakeholders in the food value chain. Here, Yara advocated sustainable intensification, sharing their knowledge, and presenting their tools and solutions. These events were complemented by a number of activities engaging farmers throughout the year, as well as engagement at major agriculture events such as Land Owners' conferences and exhibitions. Market activities are complemented by a number of knowledge development actions, such as integration of research stations and Universities' work with demo farms in Germany, and a coordinated research mission in Denmark labelled 'Future Cropping', encompassing a series of PhD and post-doc projects.
Yara's environmental solutions business units help customers cleanse hazardous nitrogen oxide (NOx) emissions. NOx emissions are poisonous, highly reactive gases that form when fuel is burned at high temperatures. Yara's emission technology systems and global reagent sales for environmental solutions allowed customers to abate 1.1 million tons emissions in 2014. This is equivalent to more than the total annual NOx emission of a country like France. The committed deliverable has thus been overachieved.
As reported in 2014, the Sahara Forest Project (SFP) finalized a pilot project documenting the functionality of the combined set of technologies, allowing for growing greenhouse vegetables in desert areas, also contributing to re-vegetation in nearby areas and producing a surplus of fresh water from sea water. The processes are powered by Concentrated Solar Power (CSP). The resulting report has been published and can be found on Sahara Forest Project's website.
Smallholder maize growers, members of the farmers' association, Masara N'Arziki, are progressing and growing organically. The membership has increased from 9,200 in end 2013 to 11,000 in end 2014. While the organic growth is healthy, setting up the financing to support a step by step approach to recruiting new members has so far proved to be more challenging. The committed market study of the project has been completed, and a summary has been made publically available on Yara's web page.
Key investments into the strategy development focus on Yara's capacity to deliver solutions on the issues of food security, resource use efficiency, environmental issues, and climate change. Such capacity investment shall also have a shared value perspective, delivering on Yara's updated mission statement: to strive for a better yield, delivering good returns for farmers, industrial customers, owners, and society at large. They have invested into internal processes such as the ones mentioned above on brand and employee value proposition, as well as the updated strategy processes.
Among Yara's more substantial investments with a clear Creating Impact perspective through 2014, the acquisition of OFD Holding is the major one. For a final enterprise value of $377 million, Yara has invested in significant value-added production capacity in Colombia as well as a network of distribution companies. This investment enables Yara to increase its delivery of more efficient, environmentally friendly, and ultimately lower carbon footprint fertilizers to their customer base in Latin America. Through the distribution network Yara gains access to an increased numbers of farmers, allowing them to expand their knowledge driven farmer outreach. The goal is to improve farm productivity and profitability by using high-quality products in an optimal way, reducing environmental impact while improving yields.