Atlas Copco
Annual report 2022
Atlas Copco is the home of industrial
ideas. We develop smart, sustainable and
highly ecient solutions that empower
our customers to grow and drive society
forward. We do it with people, prot
and planet in mind, and with the highest
business integrity.
Our innovative products, solutions, and
services are demanded by every type of
industry. They enable everything from
industrial automation to reliable medical
air solutions.
This annual report reects Atlas Copco’s
mission of creating sustainable, prot-
able growth. It integrates nancial, sus-
tainability, and governance information
to describe the Group in a comprehensive
and cohesive manner.
Introduction 1 Summary of 2022
2 A decentralized group with four business areas
3 President and CEO
This is
Atlas Copco
5 This is Atlas Copco – Home of Industrial ideas
6 Our targets
7 This is how we do business
11 Creating lasting value for all stakeholders
The year in
review
13 The year in review (Administration report)
21 Business area: Compressor Technique
24 Business area: Vacuum Technique
27 Business area: Industrial Technique
30 Business area: Power Technique
33 A sustainable approach to delivering value
34 Products and service
37 People
39 Safety and wellbeing
40 Ethics
42 Environment
44 Risks, risk management and opportunities
49 The Atlas Copco share
Governance 51 Corporate governance
Financials 61 Financial statements (Group)
66 Notes (Group)
108 Financial statements (Parent)
110 Notes (Parent)
Other
information
121 Signatures of the Board of Directors
122 Audit report
125 Financial denitions
126 Sustainability notes
135 EU Taxonomy regulation disclosures
139 GRI content index
146
Auditor’s Limited Assurance Report on
Atlas Copco AB’s sustainability report
147 Four years in summary
148 Contact information
Statutory sustainability report and
external review
Atlas Copco reports on its sustainability work
for 2022 in accordance with the GRI Standards,
which together with the EU Taxonomy regula-
tion disclosures, on pages 135–137, also
constitutes the Group’s statutory sustainability
report. Ernst & Young have expressed their
opinion that a statutory sustainability report has
been prepared according to the Swedish Annual
Accounts Act, and they have performed a lim-
ited review of the sustainability report accord-
ing to GRI, see page 146. More information can
be found at: www.atlascopcogroup.com.
Notice
The amounts in the report are presented in
MSEK unless otherwise indicated and numbers
in parentheses represent comparative gures
for the preceding year. The gures presented
in this report refer to continuing operations
unless otherwise stated.
Forward-looking statements
Some statements in this report are forward-
looking, and the actual outcomes could be
materially dierent. In addition to the factors
explicitly discussed, others could have a mate-
rial eect on the actual outcomes. Such factors
include, but are not limited to, general business
conditions, uctuations in exchange rates and
interest rates, political developments, the
impact and pricing of competing products,
product development, commercial ization and
technological diculties, supply-chain inter-
ruptions, and major customer credit losses.
Atlas Copco AB is a public company. Atlas
Copco AB and its subsidiaries are sometimes
referred to as the Atlas Copco Group, the
Group, the company, or Atlas Copco. Atlas
Copco AB is also sometimes referred to as Atlas
Copco or the company. Any mentioning of the
Board of Directors or the Board refers to the
Board of Directors of Atlas Copco AB.
The audited annual accounts and consolidated accounts can be found on pages 13–39,
44–48 and 61–121, excluding the quarterly data on page 80. The corporate
governance report examined by the auditors can be found on pages 51–60.
Sustainability information that has been reviewed by the auditors can be found on
pages 5–12, 33–43 and 126–145, excluding the taxonomy report on pages 135–137.
A solar-powered LED light tower, which enables users to
reduce CO
2
emissions. The light tower delivers ecient, high
performance giving workers good visibility while increasing
sites to comply with emission and noise regulations.
Atlas Copco 2022
Record orders, revenues and operating prot
Orders received, revenues and
operating margin
0
40 000
80 000
120 000
160 000
20222021202020192018
MSEK
0
20000
40000
60000
80000
100000
120000
2020201920182017*
MSEK
0
10
20
30
40
%
Operating cash ow and return
on capital employed
0
7
14
21
28
35
2020201920182017*
%
0
7
14
21
28
35
0
5 000
10 000
15 000
20 000
20222021202020192018
MSEK
0
10
20
30
40
%
Operating cash ow and return on capital employed
Orders received, MSEK
Revenues, MSEK
Operating margin, %
Operating cash ow, MSEK
Return on capital employed, %
Key nancial data
MSEK 2022 2021 2020 2019
Orders received 158 092 129 545 100 554 106 104
Revenues 141 325 110 912 99 787 103 756
EBITDA 36 549 29 025 24 335 26 597
– in % of revenues 25.9 26.2 24.4 25.6
EBITA
1)
31 956 25 015 20 474 22 900
– in % of revenues 22.6 22.6 20.5 22.1
Operating prot 30 216 23 559 19 146 21 897
– in % of revenues 21.4 21.2 19.2 21.1
Adjusted operating prot 30 065 24 246 19 998 22 677
– in % of revenues 21.3 21.9 20.0 21.9
Prot before tax 30 044 23 410 18 825 21 572
– in % of revenues 21.3 21.1 18.9 20.8
Prot for the year 23 482 18 134 14 783 16 543
Basic earnings per share, SEK 4.82 3.72
2)
3.04
2)
3.40
2)
Diluted earnings per share, SEK 4.81 3.71
2)
3.04
2)
3.40
2)
1)
Operating prot excluding amortization of intangibles related to acquisitions.
2)
Adjusted for share split.
Operating
margin: 21.4%
(21.2)
Operating cash ow:
MSEK 17 099
(19 378)
Revenues:
MSEK 141 325
+27%
Return on
capital employed:
29% (27)
Dividend/earnings per share, average
3)
including discontinued operations
0
10
20
30
40
50
60
3 years5 years10 years
Goal
%
Dividend policy history
–2003 30–40% of earnings
2003–2011 40–50% of earnings
2011– about 50% of earnings
3)
Dividend for the scal
year 2022 is based on the
proposal from the Board
of Directors.
Atlas Copco 2022 1
Introduction
• Summary of 2022
A decentralized group with
four business areas
President and CEO
This is Atlas Copco
The year in review
Financials
Other information
SUMMARY OF 2022
A decentralized group with four business areas
The Atlas Copco Group is a world- leading provider of sustainable produc-
tivity solutions, demanded by all types of industries, enabling everything
from industrial automation to reliable medical air solutions. The Group
oers innovative compressors, air treatment systems, vacuum solutions,
industrial power tools and assembly systems, machine vision, and power
and ow solutions. Atlas Copco develops products and services focused
on productivity, energy eciency, safety and ergonomics, supported by
insights from connected products. The company was founded in 1873,
is based in Nacka, Sweden, and has a global reach spanning more than
180countries. In 2022, Atlas Copco had revenues of BSEK 141 and about
49000 employees at year end.
Compressor
Technique
Page 21
Vacuum
Technique
Page 24
Industrial
Technique
Page 27
Power
Technique
Page 30
Revenues by region
Revenues by region
Orders received by customer category
Orders received by customer category
Asia/Oceania, 33
%N
orth
America, 23%
Africa/
Middle East, 7%
Europe, 31%
South
America, 6%
Asia/Oceania, 31% North
America, 32%
Africa/
Middle East, 2%
Europe, 33%
South
America, 2%
Asia/Oceania, 61%
North
America, 23%
Africa/
Middle East, 1% Europe, 15%
Asia/Oceania, 18
%N
orth
America, 28%
Africa/
Middle East, 9%
Europe, 37%
South
America, 8%
Other, 18%
General manu-
facturing, 25%
Construction, 15%
Service, 13%
Process industry, 24% Automotive, 1%
Electronics, 4%
Other, 11
%G
eneral manu-
facturing, 21%
Construction, 2%
Service, 6%
Electronics, 4%
Automotive, 51%
Process industry, 5%
Other, 2%
General manu-
facturing, 12%
Process
industry, 23%
Electronics, 63%
General manu-
facturing, 20%
Other, 17%
Construction, 39%
Service, 6%
Process
industry, 18%
The Compressor Technique business area provides compressed air
solutions; industrial compressors, gas and process compressors and
expanders, air and gas treatment equipment, air management systems,
and service through a global network.
Orders received: MSEK 69 834
Revenues: MSEK 61 058
Operating margin: 23.6%
The Vacuum Technique business area provides vacuum products,
exhaust management systems, valves and related products, and
service through a global network.
Orders received: MSEK 41 213
Revenues: MSEK 38 941
Operating margin: 21.6%
Revenues by region
Revenues by region
Orders received by customer category
Orders received by customer category
The Industrial Technique business area provides industrial power tools,
assembly and machine vision solutions, quality assurance products,
software, and service through a global network.
Orders received: MSEK 26 070
Revenues: MSEK 23 007
Operating margin: 20.0%
The Power Technique business area provides portable air and power,
industrial and portable ow solutions through products such as mobile
compressors, generators, light towers, industrial and portable pumps,
along with a number of complementary products. It also oers specialty
rental and provides service through a global network.
Orders received: MSEK 21 783
Revenues: MSEK 19 053
Operating margin: 18.5%
Revenues by region, Group
Asia/Oceania, 39%
North
America, 25%
Africa/
Middle East, 5%
Europe, 27%
South
America, 4%
Share of revenues, Group
Equipment, 65%Service, 35%
Orders received by customer category, Group
Other, 12%
General manu-
facturing, 20%
Construction, 12%
Service, 8%
Process industry, 20%
Electronics, 19%
Automotive, 9%
Share of revenues
Service, 43% Equipment, 57%
Share of revenues
Equipment, 78%Service, 22%
Share of revenues
Equipment, 73%Service, 27%
Share of revenues
Equipment, 56%Service, 14%
Service (Specialty
Rental), 30%
Atlas Copco 2022 2
A DECENTRALIZED GROUP WITH FOUR BUSINESS AREAS
Introduction
Summary of 2022
• A decentralized group with
four business areas
President and CEO
This is Atlas Copco
The year in review
Financials
Other information
Introduction
Summary of 2022
A decentralized group with
four business areas
• President and CEO
This is Atlas Copco
The year in review
Financials
Other information
Continuing to shape the future
We can look back at yet another year with record orders, revenues and operating prot. This is the result of our
continuous focus on improving our customers’ technologies and processes, and on driving development forward.
Looking ahead, we will continue to work together with our customers to develop new products and solutions to
their challenges, but also to the challenges society faces.
Mats Rahmström, President and CEO of the Atlas Copco Group,
how would you summarize the year?
It was a year with record orders, revenues and operating prot.
Orders received in 2022 increased 22 percent to MSEK 158092
(129545). Revenues also reached a new record with an increase of 27
percent to MSEK 141325 (110912). During the year we have faced an
increased uncertainty in the world around us. We also continued to
experience increased costs related to constraints in the supply chain
and Covid-19, which aected the margin negatively. Still, our
employees have made fantastic eorts and I believe that we have
shown that we have the ability to handle change and quickly adapt
on all levels in the company to support our customers.
Our results are the eect of our focus on delivering value to our
customers and continuously investing in people and innovation.
We also entered into new growth platforms and continued our
investments in R&D, which amounted to 4 percent of total revenues,
or MSEK5153.
Last year, the Group announced that it had set science-based
targets to reduce emissions in line with the Paris Agreement.
How has this aected the organization?
We believe that all parts of our organization have a role to play in
this, and we have set two ambitious science-based targets to reduce
emissions in all parts of the value chain. As a leading and global sup-
plier, I’m proud of our eorts to make a positive impact by reducing
emissions through our operations, transportation methods and
product design. For Scope 1 and 2, direct emissions from owned or
controlled sources and indirect emissions from the generation of
purchased energy we are well in line with our targets. For Scope 3,
the use phase of our products, we have not reached this year’s
target. The reason for this is in part due to increased sales but also to
the fact that the availability of renewable energy is lower than we
had expected. An increasing share of our products are designed to
be powered by electricity and if our customers use renewable
energy to power them, the climate impact drops dramatically.
The growing focus on battling climate change brings new expecta-
tions on us as a company. Customers, investors, and society expect
us to build our business in a sustainable way, and to generate long-
term value with people, planet and prot in mind. Environmental
performance is also a key factor for job seekers and employees, who
increasingly value working for a company that makes a positive dif-
ference. This development is a challenge, but it also gives rise to new
needs, new markets, and new business opportunities. We have a
long tradition of focusing on our customers’ needs and today this
includes helping them improve their climate performance. We inno-
vate and develop ecient and low-carbon products, but we can also
guide and support our customers on their climate journey.
There are also plenty of everyday actions that we can all carry out,
regardless of our job role or place of work. Last year, to raise aware-
ness, we arranged a global climate event for all employees.
In terms of technology and new products, what role can Atlas
Copco play to enable the transformation to a low carbon society?
When we develop products and services, we always focus on cus-
tomer value and how we can improve our customers’ productivity
and processes. More than 90 percent of the emissions from our value
chain are generated when our products are used by our customers.
Since our products are found all over the world and in all industries,
we have a real opportunity to enable a reduction of greenhouse gas
emissions on a global scale. For some applications there is not yet an
alternative to fossil fuels, and there we focus on energy eciency so
that we can oer more sustainable products for every application.
The Group set a new record with 30 completed acquisitions
during the year, why is that?
Acquisitions are an important part of our strategy for growth. The
combination of organic growth and successful acquisitions has
shaped us into the Group we are today, and we continue to look for
new technologies and segments that complement our current oer-
ing. This year, in addition to the acquisitions within the industrial
pump segment, we have for example acquired the company
Montana Instruments Corporation. They provide cryostat solutions
for customers involved in physics research and low temperature
technology solutions. This will bring an additional channel into
quantum technology related markets where commercial applica-
tions are starting to grow. Another interesting area where we have
made an acquisition is on-site gas generation that reduces the car-
bon footprint by avoiding transportation of gases. We have also
strengthened our portfolio within smart manufacturing through
the acquisition of a manufacturer of camera-based tracking systems.
FOR THE FULL LIST OF ACQUISITIONS, PLEASE SEE PAGE 73
How do you evaluate potential acquisitions?
We always start by looking at global trends that will aect our
customers’ processes and needs. We also evaluate the company’s
stand-alone potential and if there are synergies that can be realized.
We want to work with the very best, and this applies also to the com-
panies and people that we welcome to our Group. Therefore each
Atlas Copco 2022 3
PRESIDENT AND CEO
Introduction
Summary of 2022
A decentralized group with
four business areas
• President and CEO
This is Atlas Copco
The year in review
Financials
Other information
When we develop products and services, we always focus on customer value
and how we can improve our customers’ productivity and processes
division is responsible for looking for companies with leading, dier-
entiated technologies and application knowledge, and with the
same customer focus as we have. For an acquisition to be successful,
we also need to acquire companies with a culture of interaction,
innovation and commitment that matches our own.
Two of the acquisitions, LEWA and Wangen, were in a new
segment. What is the reason for building a presence within
industrial pumps?
Both companies have products that are used in industries where
we already have a strong presence today, but with dierent technol-
ogies. Wangen is a German manufacturer of progressive cavity
pumps used for transferring uids mainly in the biogas and waste-
water sectors. LEWA is a leading manufacturer of diaphragm meter-
ing pumps, process pumps and complete metering systems. Indus-
trial pumps is a segment that we have identied as a strategic t for
the Group and both companies have leading dierentiated technol-
ogies and strong aftermarket businesses. They will create a solid
foundation for further growth in new industrial pump segments.
We are experiencing increased geopolitical tensions.
As a global player, how does this aect the Group?
With customers in more than 180 countries we want to locate every-
thing from product development to marketing and production as
close to our customers as possible. With the challenges in the supply
chain that started with the Covid-19 pandemic, and that more
recently have been aected by increased geopolitical tensions and
protectionism, we have experienced long lead times and problems
with delivering to our customers on time. Dual sourcing and local
suppliers are important ways to shorten lead times and we have
worked very hard to increase our capabilities to deliver. For us, free
trade is important, and as a global Group we also believe it is import-
ant to work for an inclusive culture where also people can move
across borders and share ideas and develop their careers.
Since the beginning of the year, we have experienced a very severe
and challenging situation due to the war in Ukraine. We have col-
leagues in both Ukraine and Russia, and our primary focus has been
to ensure their safety. As of March 5th, 2022, and until further notice,
we are taking no new orders for capital equipment for delivery to
Russia. The only exemption is orders for humanitarian purposes, e.g.
medical equipment. We have also increased our focus on trade com-
pliance to ensure that we follow all applicable international trade
and export controls, economic sanctions, and embargos.
Are there any other initiatives you would like to highlight?
I am proud to say that at Atlas Copco we have a strong culture of con-
tinuous learning. Two years ago, we launched our rst global learn-
ing week across the Group and last year we repeated the initiative.
There is a saying that you should hire for attitude and train for skills.
As an employer we can provide the tools and opportunities to learn,
but within Atlas Copco each employee is responsible for his or her
career and development. Continuous learning is one way to accom-
plish this and it is also a key part of personal development.
Another important initiative is our new Code of Conduct and
ethics training for all employees. The Code of Conduct replaces our
former Business Code of Practice and covers additional topics includ-
ing modern slavery; risk management; anti-money laundering;
travel; data protection and privacy; and circularity. The document
has also been redesigned to make it easier to nd our stance on all
topics covered.
We are also taking the next steps on our digitalization journey.
One of the most interesting developments in industrial manufac-
turing is the introduction of so-called digital twins. A digital twin is a
digital original of a product that helps predict and analyze behavior
and performance, long before the physical twin exists as an actual
product or solution. Digital drawings have been in place for a long
time, but a digital twin can be used to test specic conditions or
compare performance in dierent operating conditions. We believe
this will revolutionize how we develop, manufacture and service our
products going forward and bring great customer value in the shape
of forecasts, quality control and eciency gains.
Looking ahead, what do you see the coming year?
I would like to start with a few words on the past. 2023 marks the
150th anniversary for the Group! In 1873 the world was a very dier-
ent place, and it is quite amazing that we have not only evolved
into a global Group present in so many industries, but also how we
continue to build for the future. Together with our customers, and
by always focusing on what brings them value, we develop new
products that meet the ever-increasing standards we set for our-
selves: on how we use natural resources, on safety, ergonomics,
and productivity. I would like to highlight our people who every day
look for better ways and continue to work together with our cus-
tomers to develop new products and nd new solutions to their
challenges, but also to the challenges society faces. During 2023 we
will celebrate our past, but we will also focus on how we continue to
shape the future. We are fully committed to being part of the solu-
tion for a better tomorrow and continue to build on our legacy of
innovation, doing business in an ethical way and always having the
customer in focus.
Mats Rahmström, President and CEO
Nacka, Sweden, January 2023
Atlas Copco 2022 4
PRESIDENT AND CEO
This is Atlas Copco – Home of Industrial Ideas
DIVERSIFIED
– Diverse customer base
– Sales in Asia/Oceania,
Americas, and EMEA
– Production in Europe,
Asia and Americas
AGILE
– Outsourced production model, about 75% of pro -
duction cost of equipment is purchased components
– Flexible workforce
– Continuous scenario planning
– Leadership model with clear accountability
– Transparent organization with strong follow up
RESILIENT
– 35% of sales from the service
business
– Asset-light operations
To succeed in our mission, Atlas Copco strives for a leading position in selected markets and segments. This is achieved
through innovations and by delivering leading differentiated technology. With products and services critical to the
customers’ operations, Atlas Copco strives to support customers in their success. To support profitable growth over a
business cycle, the Group aims to have an agile balance sheet and focuses on markets with high service potential.
SERVICE
Increase the service
offer by giving our
customers new
insights and peace of
mind, more and more
based on customer
data and real-time
insights.
INNOVATION
Invest in research
and development to
develop new solutions
that improve our cus-
tomers’ performance.
Connectivity and
data-driven insights
are key drivers in this.
PRESENCE
Increase market
presence by expanding
into selected markets,
segments, and technol-
ogies. Whether we sell
directly or indirectly,
and under which brand,
depends on the custom-
er and market.
OPERATIONAL
EXCELLENCE
Continuously strive for
improved operational
efficiency with respon-
sible use of resources,
including developing
top-quality and highly
efficient products and
services.
PEOPLE
Rely on competent
people who are
passionate about their
jobs, performance,
and committed to
deliver customer value.
Attract resourceful
people and empower
them to grow.
Our industrial ideas empower our customers to grow and drive society forward. This is how we create a better tomorrow.
We are convinced that leading products, together
with a decentralized organization with full
accountability for individuals and teams make our
customers, and our company, future-proof.
Our vision is to become and remain First in Mind—First in Choice of our customers and other stakeholders. Our mission is to achieve sustainable, profitable growth.
This means that we must create lasting results with responsible use of resources and with the highest business integrity.
Strategy and fundamentals
for growth
Leading
position in
selected end
markets
Products
critical to the
customers’
operations
Leading
differentiated
technology
Leading
service
offer
Atlas Copco 2022 5
THIS IS ATLAS COPCO
Introduction
This is Atlas Copco
• This is Atlas Copco – Home
of Industrial ideas
Our targets
This is how we do business
Creating lasting value for
all stakeholders
Contributing to the UN
Sustainable Development Goals
The year in review
Financials
Other information
Atlas Copco sets ambitious targets to deliver sustainable, profitable growth. The targets have different time horizons: annual, three-year, over a business cycle, and by
2030 for the more long-term ambitions. Sustainability plays a central role in Atlas Copco’s vision and is an integral part of the Group’s mission. An integrated sustainable
strategy, backed by ambitious targets, helps the company deliver greater value to all stakeholders in a way that is economically, environmentally and socially responsible.
FINANCIAL
Revenue growth measured over a business cycle Target: 8% per annum
Sustained high return on capital employed by constantly
striving for operational excellence and generating growth
Earnings as dividends to shareholders Target: about 50%
0
2
4
6
8
10
3 years5 years10 years
0
30 000
60 000
90 000
120 000
20222021202020192018
0
10
20
30
40
50
60
3 years5 years10 years
Goal
Goal
%
MSEK %
%
0
10
20
30
40
0
2
4
6
8
10
3 years5 years10 years
0
30 000
60 000
90 000
120 000
20222021202020192018
0
10
20
30
40
50
60
3 years5 years10 years
Goal
Goal
%
MSEK %
%
0
10
20
30
40
Annual revenue growth rate, average
1)
Capital employed and return
1)
Capital employed, MSEK
Return on capital employed, %
1)
Figures for the years between 2013 and 2017
are best estimated numbers, as the effects of
the distribution of Epiroc and restatements for
IFRS15 are not fully reconciled.
Our targets
Dividend/earnings per share, average
2)
including discontinued operations
0
2
4
6
8
10
3 years5 years10 years
0
30 000
60 000
90 000
120 000
20222021202020192018
0
10
20
30
40
50
60
3 years5 years10 years
Goal
Goal
%
MSEK %
%
0
10
20
30
40
Dividend policy history
–2003 30–40% of earnings
2003–2011 40–50% of earnings
2011– about 50% of earnings
2)
Dividend for the fiscal year 2022 is based on
the proposal from the Board of Directors.
PEOPLE 2022 2021 2020 Target
Female employees, at year end 21.6% 20.9% 20.0% 30% by 2030
Employees agree that they feel a sense of belonging at the company
1) 2)
– – –
Above the global
benchmark and a
continuous increase
Employees agree we have a work culture of respect, fairness and openness
1)
– 76 –
Employees agree there is opportunity to learn and grow in the company
1)
– 73 –
ETHICS
Employees sign the Group’s Code of Conduct
3)
compliance statement annually 99% 98% 99% 100%
New employees participate in the Group’s ethics training within 12 months
of joining the company, starting 2023
2)
– – – 100%
Employees participate in the Group’s biennial ethics training, starting 2023
2)
– – – 100%
Significant suppliers confirm compliance with the Group’s Code of Conduct
3)
93% 93% 93% 100%
Significant distributors confirm compliance with the Group’s Code of Conduct
3)
92% 87% 84% 100%
SAFETY & WELLBEING
Employees agree that the company takes a genuine interest in their wellbeing
1)
– 73 – Continuous increase
Balanced safety pyramid = more reports of risk observations than near misses, more reports
of near misses than minor injuries, and more or equal reports of minor injuries relative to
recordable injuries
4)
Yes Yes Yes
A balanced
safety pyramid
CLIMATE & ENVIRON MENT
Reduction in line with the 1.5 degree warming trajectory in CO
2
e
5)
emissions (tonnes)
from scopes 1 & 2, compared to the baseline 2019 –33% –17% –2% –46% by 2030
Reduction in line with the well-below 2 degrees warming trajectory in CO
2
e
5)
emissions
(tonnes) from scope 3, compared to the baseline 2019 +29% +5% +1% –28% by 2030
Significant direct suppliers with an approved environmental management system 31% 31% 30% Continuous increase
Water consumption (m
3
) in relation to cost of sales
6)
8.4 – – Continuous decrease
Reused, recycled or recovered waste from internal operations
6)
92% – – 100% by 2030
PRODUCTS & SERVICE
Projects for new and redesigned products with targets for reduced carbon impact 97% 98% – 100%
Group-common methodology for assessing the circularity of new or redesigned products – – – In place by 2024
1)
Measured every two years through the employee survey.
2)
First measurement will be done in 2023.
3)
Previously referred to as the Business Code of Practice.
4)
Risk observations are included in the safety pyramid as of 2021.
5)
CO
2
e stands for carbon dioxide equivalent.
6)
New and extended scope from 2022, including all operations.
Atlas Copco 2022 6
THIS IS ATLAS COPCO
Introduction
This is Atlas Copco
This is Atlas Copco – Home
of Industrial ideas
• Our targets
This is how we do business
Creating lasting value for
all stakeholders
Contributing to the UN
Sustainable Development Goals
The year in review
Financials
Other information
This is how we do business
Atlas Copco is characterized by
focused businesses in selected market
segments, high customer focus through
a decentralized organization, global
presence, a stable service business,
professional people, and an asset-light
and flexible manu facturing setup. By
providing pro fessional service, technical
competence, application knowledge and
digital capabilities the Group builds close
customer relationships through direct
and indirect channels.
Power Technique, 13%
Compressor
Technique, 43%
Vacuum
Technique, 28%
Industrial
Technique, 16%
Share of revenues by business area
Share of revenues
Equipment, 65%Service, 35%
Other, 12%
General manufacturing,
20%
Construction,
12%
Service, 8%
Process industry, 20%
Electronics, 19%
Automotive, 9%
Orders received by customer category
Sales and service
Atlas Copco’s ambition is to build close relation-
ships with customers and help them increase their
productivity in a sustainable way. Customer
engagement, sales, and service take place
through direct and indirect channels (mainly dis-
tributors), online as well as offline, to maximize
market presence. Digital capabilities and inter-
action are essential to supporting customers and
creating business opportunities. Consequently,
we continuously develop our teams to ensure they
are equipped with the right competencies to
make it easy to do business with us. Atlas Copco
aims at always being available to our customers
when they need us, wherever we can support
them best. The Group has a global reach with sales
in more than 180 countries.
Equipment sales are performed by engineers
with strong application knowledge and the ambi-
tion to offer the best solution for specific applica-
tions. Service and maintenance performed by
skilled technicians are an integral part of our offer.
Service is the responsibility of dedicated divisions
in each business area. This includes the develop-
ment of service products, sales and marketing,
technical support, and service delivery, all
supported by data analysis from connected
equipment.
Stable service business
35% of the Group’s revenues come from service
(spare parts, maintenance, repairs, consumables,
accessories, and specialty rental), often generated
from service contracts. An increased amount of
connected equipment gives additional opportu-
nities to support the service business in develop-
ing value for our customers. The service business
provides a strong base as revenues from service
are more stable than equipment sales.
75%
Global reach
with local
presence
Atlas Copco has a global
reach with sales in more
than 180 countries. Sales
and service are performed
by employees with strong
application and process
knowledge.
About 75% of the production
cost of equipment represents
purchased components.
Increase customer value
Customer focus is a guiding principle for Atlas
Copco. Surveys are conducted regularly to learn
from customers’ experience and opinions about
their interaction with Atlas Copco. Customers are
often also engaged in feedback discussions to
improve our products and services. A number of
key performance indicators have been estab-
lished, which are continuously followed up to
ensure improved customer satis faction.
Manufacturing and logistics
We strive to have manufacturing close to where
our customers are located. As a result, our produc-
tion facilities are located in Europe, Asia, and the
Americas. Our philosophy is to manufacture those
components critical to the equipment’s perfor-
mance inhouse. For other components, we lever-
age the capacity and competence of our business
partners. Flexible purchasing and logistics are of
great importance.
Approximately 75% of the production cost of
equipment represents purchased components,
and about 25% are internally manufactured core
components, assembly costs, and overhead.
Equipment represents about 65% of revenues,
and manufacturing and logistics are organized to
be able to quickly adapt to changes in demand.
Manufacturing of equipment is based primarily on
customer orders, while only some standard,
high-volume equipment is manufactured based
on projected demand.
The assembly of equipment is generally carried
out in Atlas Copco’s own facilities, and we take
responsibility for the products’ functionality and
quality. In order to optimize production flows the
assembly is typically lean, and the final product
is generally shipped directly to the end user.
Atlas Copco 2022 7
THIS IS ATLAS COPCO
Introduction
This is Atlas Copco
This is Atlas Copco – Home
of Industrial ideas
Our targets
• This is how we do business
Creating lasting value for
all stakeholders
Contributing to the UN
Sustainable Development Goals
The year in review
Financials
Other information
This is how we do business, continued
The organization works continuously to efficiently
use human, natural, and capital resources while
ensuring the highest quality.
Innovation
Atlas Copco believes that there is always a better
way of doing things. Innovation and product
development are of greatest importance, and
products are designed internally. Innovation will
improve customer value and strengthen customer
relationships, the brand, and financial perfor-
mance. Research and development expenditures
correspond to about 4% of total revenues.
The fundamental objective is to design, and
efficiently produce, new or improved products
that provide sustainable and tangible benefits for
customers in terms of productivity, energy effi-
ciency, and/or lower life-cycle cost. New hardware
and software are developed by skilled engineers
in the divisions. Atlas Copco protects its technical
innovations with patents.
Innovation also includes improved processes
to optimize the flow and utilization of assets and
information. Overcapacities and inefficiencies
must always be challenged.
Investments in fixed assets and working capital
Our manufacturing philosophy results in a moder-
ate need for investments in property, plant and
equipment, which can be adapted to short and
medium-term changes in demand. Most invest-
ments relate to machining equipment for core
manufacturing activities and to production facili-
ties, primarily for core component manufacturing
and assembly operations.
The working capital requirements are affected
by the relatively high share of sales through own
customer centers, which affects the amount
of inventory and receivables. In an improving
business climate with higher volumes, more work-
ing capital will be tied up. If the business climate
deteriorates, working capital will be released.
Acquisitions
Acquisitions are primarily made in, or very close to,
existing core businesses aiming to grow existing
businesses or create new platforms for growth.
All divisions are required to map and evaluate
businesses that are adjacent, and may offer tangi-
ble synergies to existing businesses. All acquired
businesses are expected to contribute positively
to economic value added.
Research and develop-
ment expenditures
correspond to about
AGILE AND RESILIENT OPERATIONAL SETUP
RESILIENCE
DETERIORATING BUSINESS
CLIMATE
Atlas Copco can:
– reduce variable costs
– reduce working capital
IMPROVING BUSINESS CLIMATE
Atlas Copco can:
– add needed resources
– add working capital
– add small incremental investments
Time
Volume/
Profits
Asset-light operations
Profitable aftermarket business
Agility
Atlas Copco has organized
its manufacturing and
logistics to be able to
quickly adapt to changes in
equipment demand.
4%
of total revenues.
Atlas Copco 2022 8
THIS IS ATLAS COPCO
Introduction
This is Atlas Copco
This is Atlas Copco – Home
of Industrial ideas
Our targets
• This is how we do business
Creating lasting value for
all stakeholders
Contributing to the UN
Sustainable Development Goals
The year in review
Financials
Other information
Atlas Copco’s organization is based on the principle
of decentralized responsibilities and authorities
STRUCTURE AND GOVERNANCE
Atlas Copco’s organization is based on the principle of decentral-
ized responsibilities and authorities (see organization chart to the
right). The organization consists of both operating and legal units.
Each opera ting unit has a business board reflecting the Group’s
operational structure. The duty of the business board is to serve in
an advisory and decision-making capacity concerning strategic
and operative issues. It also ensures the implementation of con-
trols and assessments. Each legal company has a legal board focus-
ing on compliance and reflecting the legal structure of the Group.
The Board of Directors is responsible for the organization and
management of the Group, regularly assessing the Group’s finan-
cial situation and financial, legal, social and environmental risks,
and ensuring that the organization is designed for satisfactory
control.
The President and CEO is responsible for the daily manage-
ment of the Group following the Board’s guidelines and instruc-
tions. The President and CEO is also responsible for ensuring that
the organization works towards achieving the targets for sustain-
able, profitable growth. The President and CEO leads the Group
Management, which also consists of the business area presidents
and four functional heads.
The business areas are responsible for developing their respec-
tive operations by implementing and following up on strategies
and objectives to achieve sustainable, profitable growth.
The divisions are separate operational units, responsible for
delivering results in line with the strategies and objectives set by
the business area. Each division has global responsibility for a spe-
cific product or service offering. A division can include one or more
product companies (units responsible for product development,
manufac turing and product marketing), distribution centers, and
several customer centers (units responsible for customer contacts,
sales and service) dedicated or shared with other divisions.
Regional holding functions are established worldwide to
support the divisional structure of the Group and to represent
Group Management.
As of January 1, 2023
The sharing of resources
and infrastructure/service
providers
Common processes and shared best
practices gathered in the handbook of
policies and guidelines The Way We Do Things
A common
leadership
model
An internal job
market
One Group Treasury
A shared purpose,
vision and a common
identity
Shared goals and
strategic pillars
for growth
The corporate culture and the
core values: interaction, commitment,
and innovation
The sharing of
brand names and
trademarks
The Atlas Copco Group is unified and strengthened through:
GROUP MANAGEMENT
BOARD OF DIRECTORS
PRESIDENT AND CEO
Divisions generally conduct business through product companies, distribution centers and customer centers.
COMPRESSOR TECHNIQUE
Divisions
Compressor Technique Service
Industrial Air
Oil-free Air
Professional Air
Gas and Process
Medical Gas Solutions
Airtec
Divisions
Vacuum Technique Service
Semiconductor Service
Semiconductor
Semiconductor Chamber
Solutions
Scientific Vacuum
Industrial Vacuum
VACUUM TECHNIQUE
Divisions
Industrial Technique Service
Motor Vehicle Industry Tools
and Assembly Systems
General Industry Tools and
Assembly Systems
Chicago Pneumatic Tools
Industrial Assembly Solutions
Machine Vision Solutions
INDUSTRIAL TECHNIQUE
Divisions
Power Technique Service
Specialty Rental
Portable Air
Power and Flow
POWER TECHNIQUE
This is how we do business, continued
The Group’s Code of Conduct
Atlas Copco 2022 9
THIS IS ATLAS COPCO
Introduction
This is Atlas Copco
This is Atlas Copco – Home
of Industrial ideas
Our targets
• This is how we do business
Creating lasting value for
all stakeholders
Contributing to the UN
Sustainable Development Goals
The year in review
Financials
Other information
INTERACTION
We interact and develop close rela-
tionships with customers, internally
and externally, as well as with other
stakeholders. This takes place in
many ways: physically, online or in-
directly through business partners.
We always look for what is best for
a specific target group.
INNOVATION
Our innovative spirit is reflected in
everything we do. Our customers
expect the best from Atlas Copco
and our objective is to consistently
deliver high-quality products and
service that increase customers’
productivity and competitiveness.
COMMITMENT
We operate worldwide with a long-
term commitment to our customers
in each country and market served.
We keep our promises and always
strive to exceed high expectations.
LEADERSHIP AND PEOPLE
In Atlas Copco, leadership is defined as the ability
to create lasting results through people. Atlas
Copco believes that competent and committed
leaders are crucial to achieving sustainable, profit-
able growth. Freedom to act and accountability
are guiding principles.
All leaders are given a mission statement from
their manager, outlining long-term expectations
and goals in both quantitative and qualitative
terms. The timeframe of the mission is typically
three to five years. Based on the mission state-
ment, the leader is expected to develop a vision,
and clarify how the mission will be achieved,
including the strategies, organization and people
needed to make it happen.
Atlas Copco’s performance is closely related
to how the Group succeeds in being a good
employer, attracting and developing resourceful
and motivated people. With a global business
conducted through numerous companies, we
work with continuous competence development,
knowledge sharing, while embedding our core
values: interaction, commitment, and innovation,
across all people processes.
OUR
CORE VALUES
reflect how we
behave internally
and in relation to
external
stakeholders.
ATLAS COPCO’S CODE OF CONDUCT
Internal policy documents related to
business ethics and social and environ-
mental performance are summarized
in Atlas Copco’s Code of Conduct. All
employees in Group companies, as well
as our business partners, are expected
to adhere to these policies. All employees
are also required to annually sign a com-
pliance statement and participate in a
biennial ethics training.
In Atlas Copco, leadership
is defined as the ability
to create lasting results.
Atlas Copco has a strong culture of growing
talent by encouraging employees to take account-
ability for their own career and competence devel-
opment. The Group enables and encourages
internal mobility and growth by offering continu-
ous learning activities and an internal job market.
With the ambition to develop individuals and
teams to reach their full potential, Atlas Copco
offers accessible tools and targeted learning
content, both digital and classroom courses and
programs, to all employees.
If Atlas Copco needs to adapt its capacity in a
deteriorating business climate, the first action
is to stop recruitment. Layoffs are the last resort.
PROCESSES
Group-wide strategies, processes, principles,
guide lines, and shared best practices are gathered
in the handbook of policies and guidelines
The Way We Do Things, which is available to all
employees. Although most of the processes are
self-explanatory, managers are provided regular
training in their implementation. Wherever Atlas
Copco’s employees are located, they are expected
to work in accordance with the provided pro-
cesses, principles and guidelines.
The handbook covers governance, safety,
health, environment and quality, accounting and
business control, treasury, tax, audit and internal
control, information technology, people, culture,
legal, communications and branding, risk, crisis
management, administrative services, insurance,
standardization, and acquisitions.
This is how we do business, continued
Atlas Copco 2022 10
THIS IS ATLAS COPCO
Introduction
This is Atlas Copco
This is Atlas Copco – Home
of Industrial ideas
Our targets
• This is how we do business
Creating lasting value for
all stakeholders
Contributing to the UN
Sustainable Development Goals
The year in review
Financials
Other information
Creating lasting value for all stakeholders
Atlas Copco’s vision is to become and remain First in Mind—First in Choice of our customers and other principal stakeholders.
The Group aims to continuously deliver sustainable, profitable growth with an increased positive impact on society and the
environment. Below, we illustrate how we, with a responsible use of resources – human, natural and capital – create value for
customers, employees, business partners, shareholders, as well as for society and the environment.
The resources we put in Atlas Copco The value we create
* Investments in product development, including
capitalized expenditures.
CUSTOMERS – Increased productivity
– Increased safety and ergonomics in working environment
– Energy savings
– Decreased total cost of ownership
SOCIETY/
ENVIRONMENT
– 99% of employees have signed the Code of Conduct
– 31% reduced CO
2
emissions from energy in operations
– Employment for 49 000 employees in 71 countries at year end
SHAREHOLDERS – 29% return on capital employed
– MSEK 17 099 operating cash flow
– 17% annual total return A-share, 10 year
BUSINESS
PARTNERS
– More than 6 000 significant suppliers
– Leverage competence
– Market access
– Long-term reliable partner
– Over 900 suppliers audited on safety, health, environ ment
and ethics
EMPLOYEES – Employees agree that there is opportunity to learn and
grow in the company (73 on a scale 1–100, in 2021) *
– Employees agree that Atlas Copco has a work culture of
respect, fairness and openness (76 on a scale 1–100, in 2021) *
NATURAL RESOURCES
– 518 GWh total energy use
– 58% renewable energy of total
GWh energy used in operations
– 75% of production cost of
equipment is purchased
components
HUMAN RESOURCES
– 45 800 employees, on average
– Employees in 71 countries
– 4500 R&D engineers generating
industrial ideas and innovations
FINANCIAL RESOURCES
– Average capital employed
MSEK 106 054
– MSEK 5 153 investments in
innovation*
Common vision,
mission and
strategy
Innovations
for customers’
success
Close customer relationships
with application knowledge
and professional service
Sustainability
priorities
Core
values
Decentralized
leadership
model
Agile setup
and asset-light
operations
* The employee survey is conducted every two years.
Atlas Copco 2022 11
THIS IS ATLAS COPCO
Introduction
This is Atlas Copco
This is Atlas Copco – Home
of Industrial ideas
Our targets
This is how we do business
• Creating lasting value for
all stakeholders
Contributing to the UN
Sustainable Development Goals
The year in review
Financials
Other information
Contributing to the UN Sustainable Development Goals
The UN Sustainable Development Goals are a call for action to promote prosperity while protecting the planet. The goals recognize that ending poverty
must go hand-in-hand with strategies that build economic growth and address a range of social needs, while tackling climate change and protecting
the environment. Atlas Copco endorses all 17 Sustainable Development Goals and contributes directly to the eight ones described below.
Gender equality
Increasing diversity and
ensuring inclusion
Atlas Copco promotes inclusion
and diversity and strives to improve
gender balance at all levels in the Group. The busi-
ness area presidents and the CEO have established
taskforces. See pages 37–38.
Clean water and sanitation
Working to reduce water
consumption
Atlas Copco entities carry out local
activities targeting water consump-
tion. Since 1984, Atlas Copco has supported the
employee-driven initiative “Water for All”. Until
2022, more than two million people have gained
access to clean water and improved sanitation.
See page 43.
Affordable and clean energy
Reducing CO
2
emissions from
our operations and value chain
Atlas Copco undertakes a range of
activities to reduce CO
2
emissions
from energy in operations and transport of goods,
such as installing solar panels, buying renewable
electricity and from improved logistics to avoid air
freight. See pages 42–43.
Responsible consumption
and production
Making production as efficient
as possible and reducing waste
Atlas Copco seeks to decrease the
total waste produced. Chemical handling follows
strict protocols. Components that contain conflict
minerals are not accepted and Atlas Copco moni-
tors and screens its supply chain. See pages 41–42.
Climate action
Cutting greenhouse
gas emissions
We have set science-based targets
to be a part of the solution to global
warming and climate change. Our largest impact
comes from the use of our products, and we pro-
vide solutions to reduce our customers’ energy
consumption and carbon emissions. We also work
to lower our own energy consumption, switch to
renewable energy and choosing transportation
methods that minimize climate impact. See pages
34–36 and 42–43.
See pages 33–43 for more information on how
Atlas Copco contributes to the achievement of
the UN Sustainable Development Goals.
Decent work and
economic growth
Focusing on ethics, safety and
wellbeing – for employees
and business partners
Atlas Copco requires all business partners to
comply with the Code of Conduct. Child labor or
modern slavery is not tolerated and compliance is
assessed and audited. Atlas Copco ensures the
right to collective bargaining and expects the
same from our business partners. See pages
39 – 41.
Industry, innovation and
infrastructure
Continuously increasing the
energy efficiency of products
and service
Energy efficiency in our products and service
is a key selling point for Atlas Copco. The main
environmental impact comes from our customers’
use of our products. All projects for new and rede-
signed products must assess the environmental
impact of the product. Products are developed
with a life-cycle perspective. See pages 34–36.
Peace, justice and strong
institutions
Zero tolerance for corruption
Atlas Copco requires all employees
to sign their compliance with our
Code of Conduct and to take trainings in how to
handle ethical dilemmas. Business partners are
expected to confirm their compliance with criteria
based on our Code of Conduct. See pages 41–42.
Atlas Copco 2022 12
THIS IS ATLAS COPCO
Introduction
This is Atlas Copco
This is Atlas Copco – Home of
Industrial ideas
Our targets
This is how we do business
Creating lasting value for all
stakeholders
• Contributing to the UN
Sustainable Development
Goals
The year in review
Financials
Other information
The year in review
Market review and demand
The overall demand for Atlas Copco’s equipment
and services increased in 2022. In comparable
currencies, the Group’s order intake for equip-
ment increased by 9% and the service part, includ-
ing the specialty rental business, grew by 15%,
with positive development in all business areas
and regions.
Order volumes for compressors increased sig-
nicantly, supported by increased demand from
customer segments contributing to the transition
to a low-carbon society, such as the production of
batteries for electric cars, solar panels, LNG, and
hydrogen applications. Solid order growth was
achieved for industrial compressors and for gas
and process compressors in particular, especially
in North America and Asia.
The demand for vacuum equipment was high
even though the demand from the semiconductor
and at panel display industry decreased sharply
during the latter half of the year. This resulted in
overall reduced order volumes. However, the
order volumes for equipment for industrial and sci-
entic vacuum applications increased consider-
ably.
Order volumes for industrial assembly and
vision solutions increased signicantly, primarily
as an eect of the automotive industry’s invest-
ments in the transition to electric vehicle produc-
tion, most noticeably in North America and Asia.
Order volumes to the general industry also grew.
The order intake for power equipment, such as
portable compressors, generators and pumps,
increased sharply, primarily driven by increased
demand from equipment rental companies
during the rst half of the year. The demand
was strong also during the second half of the year,
both from equipment rental companies and
end users.
In total, the Group’s order intake increased by
22% to a record MSEK 158092 (129545), corre-
sponding to an organic growth of 8%. Currency
had a positive eect of 11% and acquisitions con-
tributed with 3%. See further information in the
business area sections on pages 20–32.
North America
The order intake in North America increased 16%
in local currencies. Strong order growth was
achieved for industrial compressors and for gas
and process compressors in particular. The order
intake also increased strongly for power equip-
ment, such as portable compressors, generators,
and pumps, supported by an increased demand
primarily from equipment rental companies.
Order volumes also increased for industrial assem-
bly and vision solutions, mainly due to customers’
increased investments in the production of elec-
tric vehicles. The order intake for vacuum equip-
ment decreased due to lower demand from the
semiconductor industry. Order volumes for service
increased in all business areas. In total, North
America accounted for 27% (24) of orders received.
South America
Orders received in South America increased 17%
in local currencies. The increased order volumes
were primarily driven by increased demand for
industrial compressors and power equipment,
such as portable compressors. Growth was also
achieved for industrial assembly solutions, and
order intake for service increased in most business
areas. In total, South America accounted for 4%
(4) of orders received.
Europe
The order intake in Europe increased 13% in local
currencies. Solid order growth was achieved in all
business areas, supported by increased demand
for most product groups. The order growth was
particularly noticeable for gas and process com-
pressors, vacuum equipment, and industrial
assembly solutions. The last was supported by
increased customer investments in the production
of electric vehicles. The order intake for the service
business increased markedly with growth in all
business areas. In total, Europe accounted for
27% (28) of orders received.
Africa/Middle East
Orders received increased 17% in Africa/Middle
East in local currencies. This was driven by higher
demand for industrial compressors, gas and pro-
cess compressors, and power equipment, such as
portable compressors, generators, and pumps.
Order volumes for service also grew in most busi-
ness areas. In total, Africa/Middle East accounted
for 4% (4) of orders received.
Asia/Oceania
The order intake in local currencies in Asia/Oceania
increased by 5%. Strong order growth was
achieved for industrial compressors, gas and pro-
cess compressors, and industrial assembly and
vision solutions. However, order volumes for
vacuum equipment decreased due to lower order
intake from the semiconductor and at panel dis-
play industry. The order intake for power equip-
ment decreased as well. The service business
achieved solid order growth in all business areas.
Asia/Oceania accounted for 38% (40) of orders
received.
Market presence
Atlas Copco had own customer centers in 70 (70)
countries and production facilities in 24 (21)
countries. Revenues were reported in 183 (183)
countries.
Risks related to the war in Ukraine
Atlas Copco’s nancial exposure to Russia and
Ukraine is limited. During 2022, revenues from
Russia accounted for less than 1% of the Group’s
total revenues. Ukraine accounted for well below
0.1% of the Group’s total revenues. Further, Atlas
Copco has no production units in Russia or
Ukraine. Hence, the ongoing war has very limited
direct nancial eects on Atlas Copco. Given the
uncertainties surrounding the ongoing conict, it
is very dicult to predict potential indirect eects
on Atlas Copco. As of December 31, 2022, there is
no signicant impact on any balance sheet items.
Important events
Acquisitions and divestments
The Group completed 30 acquisitions during the
year. In total, the acquisitions added net revenues
of approximately MSEK 3430. See further infor-
mation in note 2 and in the business area sections
on pages 20–32.
Changes in Group Management
Eva Klasén was appointed Senior Vice President,
Chief Legal Ocer eective May 1, 2022, replacing
Håkan Osvald who retired. Eva Klasén was previ-
ously Deputy Chief Legal Ocer at Atlas Copco AB.
Sara Hägg Liljedal was appointed Chief Com-
munications Ocer eective February 1, 2022.
She replaced Gisela Lindstrand, who left the
Group in September 2021. Sara Hägg Liljedal was
previously Media Relations Manager for the
Group.
ESG recognitions
In 2022, Atlas Copco received, among others, a
rating of AA in the MSCI ESG Ratings assessment,
was given Prime status by ISS ESG rating, and
remains a constituent of the FTSE4Good Index
Series. Atlas Copco scored a C by CDP in 2022 for
the carbon related disclosure and a C for the water
related disclosure.
Atlas Copco 2022 13
THE YEAR IN REVIEW
Introduction
This is Atlas Copco
The year in review
• Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Financial targets – growth and
return development
Annual revenue growth rate, average (FX adjusted)
1)
The Group’s goal for annual revenue growth is
8%, measured over a business cycle. At the same
time, the ambition is to grow faster than the
most important competitors. Growth should
primarily be organic, supported by selective
acquisitions.
Atlas Copco aims to have a strong and cost-
ecient nancing of the business. The priority
for the use of capital is to develop and grow
the business. The strong protability and cash
generation allow the Group to do that while at
the same time maintaining the ambition to
distribute about 50% of earnings as dividends
to shareholders.
Dividend/earnings per share, average
2)
including discontinued operations
Capital employed and return
The Group’s goal is to deliver sustained high return
on capital employed, by constantly striving for
operational excellence and generating growth.
1)
Figures for the years between 2013 and 2017 are best
estimated numbers, as the eects of the distribution of
Epiroc and restatements for IFRS 15 are not fully reconciled.
0
2
4
6
8
10
3 years5 years10 years
0
30 000
60 000
90 000
120 000
20222021202020192018
0
10
20
30
40
50
60
3 years5 years10 years
Goal
Goal
%
MSEK %
%
0
10
20
30
40
0
2
4
6
8
10
3 years5 years10 years
0
30 000
60 000
90 000
120 000
20222021202020192018
0
10
20
30
40
50
60
3 years5 years10 years
Goal
Goal
%
MSEK %
%
0
10
20
30
40
0
2
4
6
8
10
3 years5 years10 years
0
30 000
60 000
90 000
120 000
20222021202020192018
0
10
20
30
40
50
60
3 years5 years10 years
Goal
Goal
%
MSEK %
%
0
10
20
30
40
Dividend policy history
–2003 30–40% of earnings
2003–2011 40–50% of earnings
2011– about 50% of earnings
2)
Dividend for the scal year 2022
is based on the proposal from
the Board of Directors.
Orders received by region and order
development in local currency
Capital employed, MSEK
Return on capital employed, %
Share: 27%
Change: +16%
Share: 4%
Change: +17%
Share: 27%
Change: +13%
Share: 4%
Change: +17%
Share: 38%
Change: +5%
North
America
South
America
Europe
Africa/
Middle East
Asia/
Oceania
Atlas Copco 2022 14
THE YEAR IN REVIEW
Introduction
This is Atlas Copco
The year in review
• Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Revenues
The Group’s revenues increased 27% to a record MSEK 141325
(110912), corresponding to a 12% organic increase. Currency had a
positive eect of 12%, and acquisitions contributed with 3% during
the year. The Group’s goal is to achieve an annual revenue growth
of 8% over a business cycle. For the period 2013–2022, the average
annual revenue growth has been 8%*.
Operating prot
The operating prot also reached a record of MSEK 30216 (23559)
corresponding to a margin of 21.4% (21.2). Items aecting compara-
bility were a change in provision for share-related long-term incen-
tive programs, reported in Common Group Items, of MSEK 151
(–687). The adjusted operating prot increased 24% to MSEK 30065
(24246) corresponding to a margin of 21.3% (21.9). See the sales and
prot bridge below.
The operating prot for the Compressor Technique business area
increased by 21% to MSEK 14425 (11874), corresponding to a mar-
gin of 23.6% (23.9). The margin was positively aected by currency
and higher organic revenue volumes. In contrast, increased costs
related to Covid-19, primarily in the rst half of the year, supply chain
constraints and consequent ineciencies in factories had a negative
eect on the operating margin.
The operating prot for the Vacuum Technique business area
increased 19% to MSEK 8407 (7066), corresponding to a margin
of 21.6% (24.2). The main explanations for the lower margin were
higher costs related to supply chain constraints, ineciencies in
factories, and costs associated with Covid-19. The last was primarily
during the rst half of the year.
The operating prot for the Industrial Technique business area
increased 16% to MSEK 4597 (3976), and the operating margin
reached 20.0% (20.5). Increased costs related to supply chain con-
straints, Covid-19 in the rst half of the year, and stock adjustments
and provisions, aected the margin negatively. Currency had a posi-
tive eect on the operating margin.
The operating prot for the Power Technique business area
increased 66% to a record MSEK 3525 (2121), corresponding to a
margin of 18.5% (16.0). The main explanation for the higher operat-
ing margin was increased organic revenue volumes. Costs related to
supply chain constraints, and Covid-19 in the rst half of the year,
Revenues and return
* Currency adjusted. Figures for the years 2013–2017 are best estimated numbers, as the eects of the distribution of Epiroc and restatements for IFRS 15 are not fully reconciled.
Bridge – revenues
and operating prot, MSEK 2022
Volume, price,
mix and other Currency Acquisitions
Items affecting
comparability
Share-based long-term
incentive programs
2021
Revenues 141 325 13 558 13 425 3 430 – – 110 912
Operating prot 30 216 1 109 4 495 215 0 838 23 559
Eect on margin, % 21.4 21.2
Sales bridge,
Atlas Copco Group
Orders received Revenues
2021, MSEK 129 545 110 912
Structural change, % +3 +3
Currency, % +11 +12
Organic *, % +8 +12
Total, % +22 +27
2022, MSEK 158 092 141 325
* Volume, price and mix.
Sales bridge Compressor Technique Vacuum Technique Industrial Technique Power Technique
Orders received Revenues Orders received Revenues Orders received Revenues Orders received Revenues
2021, MSEK 55 012 49 657 39 529 29 219 20 545 19 421 15 155 13 234
Structural change, % +2 +2 +1 +2 –1 +0 +13 +15
Currency, % +11 +11 +11 +15 +11 +10 +13 +13
Organic*, % +14 +10 –8 +16 +17 +8 +18 +16
Total, % +27 +23 +4 +33 +27 +18 +44 +44
2022, MSEK 69 834 61 058 41 213 38 941 26 070 23 007 21 783 19 053
* Volume, price and mix.
0
40 000
80 000
120 000
160 000
20222021202020192018
MSEK
0
20000
40000
60000
80000
100000
120000
2020201920182017*
MSEK
0
10
20
30
40
%
Orders received, revenues and operating margin
Orders received, MSEK
Revenues, MSEK
Operating margin, %
aected the margin negatively. Currency had a small positive eect
on the operating margin.
Net costs for common Group items and eliminations were MSEK
–738 (–1478). The decrease was primarily due to lower costs related
to share-related long-term incentive programs, which were MSEK
151 (– 687).
Atlas Copco 2022 15
THE YEAR IN REVIEW
Introduction
This is Atlas Copco
The year in review
• Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Revenues and operating prot, MSEK
Revenues Operating prot Operating margin, % Return on capital employed, % Investments in tangible xed assets
1)
2022 2021 2022 2021 2022 2021 2022 2021 2022 2021
Compressor Technique 61 058 49 657 14 425 11 874 23.6 23.9 82 93 897 620
Vacuum Technique 38 941 29 219 8 407 7 066 21.6 24.2 24 25 2 099 993
Industrial Technique 23 007 19 421 4 597 3 976 20.0 20.5 17 16 518 269
Power Technique 19 053 13 234 3 525 2 121 18.5 16.0 25 27 1 009 571
Common Group functions/eliminations –734 –619 –738 –1 478 25 27
Total Group 141 325 110 912 30 216 23 559 21.4 21.2 29 27 4 548 2 480
1)
Excluding right-of-use assets.
Depreciation and EBITDA
Depreciation, amortization and impairment costs were MSEK 6347
(5466) and earnings before depreciation and amortization, EBITDA,
reached MSEK 36549 (29025), corresponding to a margin of 25.9%
(26.2).
Net nancial items
The Group’s net nancial items decreased to MSEK –172 (–149).
The net interest expense was MSEK –166 (–234). Other nancial
items were MSEK –6 (85). See notes 8 and 27.
Prot before tax
Prot before tax increased 28% to MSEK 30044 (23410). Excluding
items aecting comparability, prot before tax was MSEK 29893
(24097), corresponding to margin of 21.2% (21.7).
Taxes
Taxes for the year amounted to MSEK 6562 (5276), corresponding
to an eective tax rate of 21.8% (22.5) in relation to prot before tax.
The main reason for the lower tax rate is positive outcome of a tax
litigation. In addition, a deduction of rolled forward interest costs
from previous years has been made in Sweden. See note 9.
Prot and earnings per share
Prot for the year increased 29% to MSEK 23482 (18134). This corre-
sponds to basic and diluted earnings per share of SEK 4.82 (3.72,
adjusted for share split) and SEK 4.81 (3.71, adjusted for share split)
respectively.
Depreciation, amortization
and impairment, MSEK 2022 2021
Rental equipment 779 707
Other property, plant and equipment 1 561 1 361
Right-of-use assets 1 330 1 147
Intangible assets 2 677 2 251
Total 6 347 5 466
Key nancial data, MSEK 2022 2021 Change, %
Orders received 158 092 129 545 22
Revenues 141 325 110 912 27
EBITDA 36 549 29 025
– in % of revenues 25.9 26.2
EBITA
1)
31 956 25 015
– in % of revenues 22.6 22.6
Operating prot 30 216 23 559 28
– in % of revenues 21.4 21.2
Adjusted operating prot 30 065 24 246 24
– in % of revenues 21.3 21.9
Prot before tax 30 044 23 410 28
– in % of revenues 21.3 21.1
Prot for the year 23 482 18 134 29
Basic earnings per share, SEK 4.82 3.72
2)
Diluted earnings per share, SEK 4.81 3.71
2)
1)
Operating prot excluding amortization of intangibles related to acquisitions.
2)
Adjusted for share split.
Revenues and return, continued
Atlas Copco 2022 16
THE YEAR IN REVIEW
Introduction
This is Atlas Copco
The year in review
• Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Balance sheet
The Group’s total assets increased 26% to MSEK 172301 (136683).
Cash, cash equivalents and other current nancial assets decreased
to MSEK 12143 (19837), as a net eect of operational cash genera-
tion (see next page), dividend to shareholders MSEK –9250,
redemption of shares MSEK –9 732 and acquisitions MSEK –10591.
Working capital ratios
The ratio of inventories to revenues at year end increased to 19.3%
(16.0), and trade receivables to 21.2% (19.8). Trade payables were
13.5% (13.7).
Capital turnover
The capital turnover ratio was 0.91 (0.88) and the capital employed
turnover ratio was 1.33 (1.27).
Equity
At year end, Group equity including non-controlling interests was
MSEK 80 026 (67634), corresponding to 46% (49) of total assets.
Equity per share was SEK 16 (14). Atlas Copco’s market capitalization
at year end was BSEK 587 (733), a decrease of 20%. The information
related to public takeover bids is the same as for the Parent Company
and described on page 19.
Total comprehensive income for the year was MSEK 31854
(23025). See page 62 and note 10. Shareholders’ transactions
include dividends and redemption of shares totaling MSEK –18982
(–8889), sales and repurchases of own shares of net MSEK 483
(–1034), and share-based payments of net MSEK –41 (–234).
See page 64 and note 20.
Return on capital employed and return on equity
Return on capital employed reached 29% (27) and the return on
equity was 32% (30). The Group uses a weighted average cost of
capital (WACC) of 8% (8) after tax as an investment and overall
performance benchmark.
Revenues and return, continued
Balance sheet in summary, MSEK Dec 31, 2022 Dec 31, 2021
Intangible assets 67 067 50 348
Rental equipment 2 689 2 342
Other property, plant and equipment 12 720 8 991
Right-of-use assets 4 752 3 244
Other xed assets 4 861 3 752
Inventories 27 219 17 801
Receivables 40 849 30 363
Current nancial assets 889 847
Cash and cash equivalents 11 254 18 990
Assets classied as held for sale 1 5
Total assets 172 301 136 683
Total equity 80 026 67 634
Interest-bearing liabilities 38 713 27 988
Non-interest-bearing liabilities 53 562 41 061
Total equity and liabilities 172 301 136 683
Equity, MSEK 2022 2021
Opening balance 67 634 53 534
Prot for the year 23 482 18 134
Other comprehensive income for the year 8 372 4 891
Shareholders’ transactions –18 982 –8 889
Change of non-controlling interests 44 –836
Acquisition and divestment of own shares –483 1 034
Share-based payments, equity settled –41 –234
Closing balance 80 026 67 634
Equity attributable to
– owners of the parent 79 976 67 633
– non-controlling interests 50 1
Atlas Copco 2022 17
THE YEAR IN REVIEW
Introduction
This is Atlas Copco
The year in review
• Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Interest-bearing debt and net indebtedness
Total interest-bearing debt was MSEK 38713 (27988), whereof
MSEK 2380 (3114) in post-employment benets. The Group has
an average maturity of 4.0 years on interest-bearing liabilities. See
notes 21 and 23 for additional information. The Group’s net indebt-
edness, amounted to MSEK 26570 (8151) at year end. The net debt/
EBITDA ratio was 0.7 (0.3) and the debt/equity ratio was 33% (12).
Credit rating
Atlas Copco’s long-term and short-term debt is rated by Standard
& Poor’s and Fitch with the long-/short-term rating A+/A-1 and
A+/F1+, respectively.
Operating cash ow and investments
Operating cash surplus was MSEK 36978 (28952). Cash ows from
nancial items were MSEK –714 (459). Net pension funding and pay-
ments were MSEK –419 (–330). The working capital increased by
MSEK 7 415 (increase of 244), primarily due to increased inventories
in response to supply chain constraints. Net investments in rental
equipment were MSEK 808 (474).
Gross investments in property, plant and equipment increased to
MSEK 3660 (1970). In 2022, Compressor Technique made notable
investments in production, and research and development facilities
in Belgium.
Vacuum Technique invested in a service technology center in
China, new distribution centers in South Korea and Japan, a manu-
facturing facility in South Korea, a remanufacturing and assembly
facility in the USA, and a cryopump manufacturing and R&D facility
in the USA.
Revenues and return, continued
Industrial technique invested in new machining equipment in its
production facility in Sweden, a new innovation center for battery
production and electronics in Germany, and a new production and
R&D facility in China. Power Technique invested in a new logistic
center in the USA. Cash received from sale of property, plant and
equipment equaled to MSEK 99 (93).
Net investments in intangible assets, mainly related to capitali-
zation of product development expenditures, were MSEK 1371
(1389). Net investments in other assets were MSEK 20 (–514).
In total, the operating cash ow reached MSEK 17099 (19378).
Cash ow from structural changes
The net cash ow from structural changes, i.e. acquisitions and
divestments, amounted to MSEK –10591 (–2341). See also note 2.
Cash ow from nancing
Dividends paid amounted to MSEK –9250 (–8889) and the manda-
tory redemption was MSEK –9732. Sales and repurchases of own
shares resulted in a net of MSEK –483 (1034) , all related to hedging
or deliveries of shares for the long-term incentive plans described
on page 92. Change in interest-bearing liabilities was MSEK 4814
(–1645).
Employees
In 2022, the average number of employees in the Group increased
by 4509 to 45781. At year end, the number of employees was
48951 (42862), and the number of consultants/external work-
force was 3834 (3762). For comparable units, the total workforce
increased by 3394. See also note 5.
Calculation of operating cash ow, MSEK 2022 2021
Operating cash surplus 36 978 28 952
Net nancial items –714 459
Taxes paid –6 245 –5 211
Pension funding –419 –330
Change in working capital –7 415 –244
Increase in rental equipment, net –808 –474
Cash ows from operating activities 21 377 23 152
Investments of property, plant and
equipment, net –3 561 –1 877
Other investments, net –1 351 –1 356
Cash ow from investments –4 912 –3 233
Adjustment for currency hedges of loans 634 –541
Operating cash ow 17 099 19 378
Average number of employees 2022 2021
Atlas Copco Group 45 781 41 272
– Sweden 1 474 1 402
– Outside Sweden 44 307 39 870
Business areas
– Compressor Technique 20 044 18 785
– Vacuum Technique 10 929 8 961
– Industrial Technique 9 162 8 745
– Power Technique 4 810 3 973
– Common Group functions 836 808
Atlas Copco 2022 18
THE YEAR IN REVIEW
Introduction
This is Atlas Copco
The year in review
• Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Atlas Copco AB is the ultimate Parent Company of the
Atlas Copco Group and is headquartered in Nacka, Sweden.
Earnings
Prot before tax amounted to MSEK 32753 (5515) and prot for
the year amounted to MSEK 32433 (5176). The dierence between
the years is mainly due to increased dividends from Group Companies.
Financing
The total assets of the Parent Company were MSEK 184774 (173859).
At year end 2022, cash and cash equivalents amounted to MSEK 0 (0)
and interest-bearing liabilities amounted to MSEK 21 393 (23121).
Equity represented 88% (86) of total assets and non-restricted
equity totaled MSEK 156 517 (143591).
Employees
The average number of employees in the Parent Company was
110 (107).
Remuneration
Principles for remuneration, fees and other remuneration paid to
the Board of Directors, the President and CEO, and other members of
Group Management, other statistics and the guidelines regarding
remuneration and benets to Group Management as approved by
the Annual General Meeting are specied in note 5.
Financial risks, risks and factors of uncertainty
Atlas Copco is subject to currency risks, interest rate risks and other
nancial risks. Atlas Copco has adopted a policy to control the nan-
cial risks to which Atlas Copco AB and other Group companies are
exposed. A nancial risk management committee meets regularly
to make decisions about how to manage these risks. See also Risks,
risk management and opportunities on pages 44–48.
Appropriation of prot
The Board of Directors proposes to the Annual General Meeting
2023 a dividend of SEK 2.30 (1.90, adjusted for share split) per share
to be paid for the 2022 scal year. Excluding shares currently held
by the Company, the proposed dividend corresponds to a total of
MSEK 11197 (9258).
In order to facilitate a more ecient cash management, the
dividend is proposed to be paid in two equal installments, the rst
with record date May 2, 2023, and the second with record date
October 20, 2023.
SEK
Retained earnings including reserve for fair value 124 083 709 433
Prot for the year 32 433 451 449
The Board of Directors proposes that these earnings
be appropriated as follows:
To the shareholders, a dividend of SEK 2.30 per share 11 197 221 020
To be retained in the business 145 319 939 862
Total 156 517 160 882
Parent Company
Shares and share capital
At year end, Atlas Copco’s share capital totaled MSEK 786 (786) and
a total number of 4 918 452 416 shares divided into 3357576384
class A shares and 1560876032 class B shares were issued. Net of
50095451 class A shares and 0 class B shares held by Atlas Copco,
4868356965 shares were outstanding. Class A shares entitle the
owner to one vote while class B shares entitle the owner to one tenth
of a vote. Class A shares and class B shares carry equal rights to a part
of the Company’s assets and prot.
Investor AB is the single largest shareholder in Atlas Copco AB.
At year end 2022, Investor AB held a total of 836131135 shares,
representing 22.3% of the votes and 17.0% of the capital.
There are no restrictions prohibiting the right to transfer shares of
the Company, nor is the Company aware of any such agreements.
In addition, the Company is not party to any material agreement that
enters into force or is changed or ceases to be valid if the control of
the Company is changed as a result of a public takeover bid. There is
no limitation to the number of votes that can be cast at a General
Meeting of shareholders.
As prescribed by the Articles of Association, the General Meeting
has sole authority for the election of Board members and there are
no other rules relating to the election or dismissal of Board members
or changes in the Articles of Association. Correspondingly, there are
no agreements with Board members or employees regarding com-
pensation in case of changes of current position reecting a public
takeover bid.
Statutory sustainability report
Atlas Copco AB has prepared a sustainability report in accordance
with the Global Reporting Initiative’s guidelines (GRI Standards)
which, in combination with the EU Taxonomy regulation disclosures
on pages 135–137, also constitutes Atlas Copco AB’s statutory sus-
tainability report and encompasses all its subsidiaries. The sustain-
ability report has been prepared in accordance with the disclosure
requirements set out in the Swedish Annual Accounts Act, chapter 6,
paragraph 11. The scope and content of the sustainability report are
dened on page 138.
Atlas Copco 2022 19
THE YEAR IN REVIEW
Introduction
This is Atlas Copco
The year in review
• Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Introduction
This is Atlas Copco
The year in review
Administration report
• Business areas
Compressor Technique
Vacuum Technique
Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Business areas
Key gures, MSEK 2022 2021 Change, %
Orders received 69 834 55 012 27%
Revenues 61 058 49 657 23%
EBITA* 14 882 12 205
– as a percentage of revenue 24.4 24.6
Operating prot 14 425 11 874 21%
Operating margin, % 23.6 23.9
Return on capital employed, % 82 93
Investments 897 620
Average number of employees 20 044 18 785
* Operating prot excluding amortization of intangibles related to acquisitions.
Key gures, MSEK 2022 2021 Change, %
Orders received 41 213 39 529 4%
Revenues 38 941 29 219 33%
EBITA* 9 019 7 569
– as a percentage of revenue 23.2 25.9
Operating prot 8 407 7 066 19%
Operating margin, % 21.6 24.2
Return on capital employed, % 24 25
Investments 2 099 993
Average number of employees 10 929 8 961
* Operating prot excluding amortization of intangibles related to acquisitions.
Key gures, MSEK 2022 2021 Change, %
Orders received 26 070 20 545 27%
Revenues 23 007 19 421 18%
EBITA* 5 127 4 538
– as a percentage of revenue 22.3 23.4
Operating prot 4 597 3 976 16%
Operating margin, % 20.0 20.5
Return on capital employed, % 17 16
Investments 518 269
Average number of employees 9 162 8 745
* Operating prot excluding amortization of intangibles related to acquisitions.
Key gures, MSEK 2022 2021 Change, %
Orders received 21 783 15 155 44%
Revenues 19 053 13 234 44%
EBITA* 3 666 2 182
– as a percentage of revenue 19.2 16.5
Operating prot 3 525 2 121 66%
Operating margin, % 18.5 16
Return on capital employed, % 25 27
Investments 1 009 571
Average number of employees 4 810 3 973
* Operating prot excluding amortization of intangibles related to acquisitions.
The Compressor Technique business area provides compressed air solutions: industrial compressors,
gas and process compressors and expanders, air and gas treatment equipment, and air manage-
ment systems. The business area has a global service network and innovates for sustainable
productivity mainly for the manufacturing and process industries.
Compressor Technique, page 21
Vacuum Technique, page 24
The Vacuum Technique business area provides vacuum products, exhaust management systems,
valves and related products. The main markets served are semi conductor and scientic, as well as
a wide range of industrial segments including chemical process industries, food packaging and
paper handling. The business area has a global service network and innovates for sustainable
productivity in order to further improve its customers’ performance.
Industrial Technique, page 27
Power Technique, page 30
The Industrial Technique business area provides industrial power tools, assembly technologies,
machine vision solutions, quality assurance products, software and service through a global net-
work. The business area innovates for sustainable productivity for customers in the automotive
and general industries.
The Power Technique business area provides portable air and power, industrial and portable
ow solutions through products such as mobile compressors, generators, light towers, industrial
and portable pumps, along with a number of complementary products. It also oers specialty
rental and provides service through a global network. Guided by a forward-thinking approach to
innovation, Power Technique provides sustainable productivity solutions across multiple industries,
including construction, manufacturing, oil and gas, and exploration drilling.
Atlas Copco 2022 20
THE YEAR IN REVIEW
Compressor Technique
The demand for the business area’s equipment and service was strong, and order volumes increased signicantly. The increased order intake was supported by
solid demand in all regions. 18 acquisitions were completed during the year, and continued investments were made in product development, online and oine
market presence, and service. The business area also intensied its focus on developing solutions for customer segments contributing to a low-carbon society.
Market development
The demand for equipment and service was
strong, and order volumes increased markedly
throughout the year. In total, the order intake
increased 14% organically.
Order volumes for the service business
increased noticeably, with solid order growth in
all regions. The increased order intake was gen-
erated by a higher demand for spare parts, repair,
maintenance, and service contracts, the latter
supported by an increased number of connected
products in the market.
The order intake for equipment increased sig-
nicantly, supported by increased demand in all
regions, especially in North America and Asia.
Customer segments contributing to the transition
to a low-carbon society, such as the production of
batteries for electric cars, solar panels, LNG, and
hydrogen applications, particularly supported the
growth in order intake. The order intake for large
industrial compressors grew more than orders for
small and medium-sized compressors, particularly
during the second half of the year. Order volumes
for gas and process compressors increased signi-
cantly, with strong growth in all regions, particu-
larly in North America.
Market presence and organizational
development
The business area strengthened its market posi-
tion with the launch of several new innovative
products during the year. The product portfo-
lio was expanded in particular for applications
related to the energy transition, such as compres-
sion and liquication of hydrogen and LNG. The
service oer was also further developed through
continued focus on connectivity and data analytics.
Sales bridge Orders received Revenues
2021, MSEK 55 012 49 657
Structural change, % +2 +2
Currency, % +11 +11
Organic*, % +14 +10
Total, % +27 +23
2022, MSEK 69 834 61 058
* Volume, price and mix
Revenues, MSEK
61 058
2021: 49 657
Operating
prot margin
23.6%
2021: 23.9%
Return on capital
employed
82%
2021: 93%
0
20 000
40 000
60 000
80 000
20222021202020192018
0
10
20
30
40
MSEK
%
Orders received, revenues
and operating margin
Orders received, MSEK
Revenues, MSEK
Operating margin, %
Resources were added in research and develop-
ment and market presence, primarily through the
development of digital channels.
While the business grew signicantly, the busi-
ness area managed to lower its environmental
footprint from operations, as a result of a further
increased use of renewable energy. The business
area also supported its customers’ sustainability
eorts through an increased installed base of
energy ecient products.
The business area continued to develop its
main European site in Antwerp, Belgium, through
investments in its production and research and
development facilities.
The business area also increased its presence
in targeted markets and customer segments
through several acquisitions, see below.
The business area made in total
18 acquisitions in 2022:
• Oxymat A/S, a Danish manufacturer of on-site
gas generation equipment with 146 employees
and revenues of about MSEK 411.
• SCB S.r.l., an Italian condensate management
manufacturer with 16 employees and revenues
of MSEK 51.
• Aircel, LLC., a US-based provider of air treatment
and air purication solutions with 19 employees
and revenues of about MSEK 55.
• The assets in Suzhou Since Gas System Co., Ltd.,
a Chinese manufacturer of on-site gas genera-
tion with 80 employees and revenues of about
MSEK 93.
• Shandong Meditech Medical Technology Co.,
Ltd., a Chinese manufacturer of medical oxygen
solutions with 70 employees and revenues of
about MSEK 114.
The following acquisitions were also made:
• CAS Products Ltd, a British distributor.
• Associated Compressor Engineers Ltd (ACE),
a UK-based distributor.
• Bireme Group, a Singapore-based distributor
• FITEC S.A.S., a French distributor.
• Glaston Compressor Services Ltd., a UK-based
distributor.
• The operating assets of Compressed Air
Products, Inc., a US-based distributor.
• DF-Druckluft-Fachhandel GmbH, a German
company specialized in online sales.
• Mesa, a US-based distributor.
• Vector Sp. z o.o., a Polish-based distributor.
• Precision Pneumatics Ltd, UK-based distributor.
• Wearside Pneumatics Ltd, UK-based distributor.
• Entreprises Larry Inc., a Canadian distributor.
• The operating assets of Northeast Compressor,
a US-based distributor.
For more information see page 73.
Revenues, prots and returns
Revenues reached MSEK 61058 (49657), an
organic increase of 10%. The operating prot
increased by 21% to MSEK 14425 (11874),
corresponding to a margin of 23.6% (23.9). The
margin was positively aected by currency and
higher organic revenue volumes. In contrast,
increased costs related to Covid-19, primarily in the
rst half of the year, supply chain constraints and
consequent ineciencies in factories had a neg-
ative eect on the operating margin. Return on
capital employed was 82% (93).
Atlas Copco 2022 21
THE YEAR IN REVIEW – COMPRESSOR TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
• Compressor Technique
Vacuum Technique
Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
The market
The global market for compressed air equipment,
air and gas treatment equipment, and related
services is characterized by a diversied customer
base. The customers request solutions that are
reliable, productive, ecient, and suited to spe-
cic applications. Customers are also increasingly
looking for partners to support their sustainability
ambitions.
Compressors are used in a broad spectrum of
applications. Clean, dry, and oil-free air is needed
in industrial processes, e.g. the food, pharma-
ceutical, electronics, and textile industries. Com-
pressors are used in wastewater treatment, and
increasingly in applications contributing to the
transition to a low-carbon society, such as green
hydrogen, LNG, and batteries for electric vehicles.
Compressed air is also used in automation and
in sectors as diversied as hospitals, and in high-
speed trains. Blowers are used in applications
where there is a need for a consistent ow of low-
pressure air, for example in waste water treatment,
and conveying.
Gas and process compressors and expanders
are supplied to various process industries, such as
air separation plants, power utilities, chemical and
petro chemical plants, and liqueed natural gas
applications.
Stationary industrial air compressors and asso-
ciated air-treatment products, spare parts and
service represent about 90% of sales. Large gas
and process compressors, including related
service, represent about 10%.
Other, 18%
General manu-
facturing, 25%
Construction, 15%
Service, 13%
Process industry, 24% Automotive, 1%
Electronics, 4%
Orders received by
customer category
Asia/Oceania, 33
%N
orth
America, 23%
Africa/
Middle East, 7%
Europe, 31%
South
America, 6%
Revenues by region
Service, 43% Equipment, 57%
Share of revenues
Market trends
• Increased focus on energy eciency, energy
recovery, and the reduction of CO
2
emissions
• Accelerated investments in market segments
contributing to a low carbon society
• Focus on total solution and total life- cycle cost
• The combination of cloud technology, big data
and machine learning increases the demand
for data-driven service solutions
• New applications for compressed air
Demand drivers
• Industrial production
• Transition to a low-carbon society
• Energy costs
• The need for decreased CO
2
emissions drives
demand for more energy-ecient machinery
Vision and strategy
The vision is to be First in Mind—First in Choice as
a supplier of compressed air and gas solutions by
being interactive, committed and innovative, and
by oering the best value to customers. The strat-
egy is to further develop Atlas Copco’s leading
position in selected niches and growing the busi-
ness in a way that is economically, environmen-
tally and socially responsible. This should be done
by capitalizing on the strong global market pres-
ence, improving market penetration in mature
and developing markets, and continuously devel-
oping improved products and solutions to satisfy
customer demands. The presence is enhanced by
utilizing several commercial brands. Key strategies
include growing the service business as well as
developing businesses within focused areas such
as air-treatment equipment, blowers, and com-
pressor solutions for trains, ships, and hospitals.
By oering the most energy-ecient products,
the business aims to contribute to a better tomor-
row and to support customers in meeting their
sustainability ambitions.
The business area is actively looking at acquir-
ing complementary businesses.
Strategic activities
• Intensify focus on research and development
• Increase focus on digitalization and connected
products
• Increase market coverage, through digital and
physical presence, and improve presence in tar-
geted markets/segments
• Develop new sustainable products and solu-
tions oering better value and improved energy
eciency to customers
• Activities supporting customers to meet their
sustainability ambitions
• Extend the product and service oering at
current customers and adjacent segments and
applications
• Perform more service on a higher share of the
installed base of equipment
• Increase operational eciency
• Invest in people and competence development
• Acquire complementary businesses
Competition
Compressor Technique’s principal competitors
in the market for industrial compressors and air
treatment equipment are Ingersoll Rand, Kaeser,
Hitachi, and Parker Hannin. There are also
numerous regional and local competitors, for
example, in China. In the market for gas and
process compressors and expanders, the main
competitors are Siemens and MAN Turbo.
Market position
A leading market position globally in most of its
operations.
Atlas Copco 2022 22
THE YEAR IN REVIEW – COMPRESSOR TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
• Compressor Technique
Vacuum Technique
Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Compressor Technique: Products and applications
Piston compressors
Piston compressors are available as oil-injected
and oil-free. They are used in general industrial
applications as well as specialized applications.
Oil-free tooth and scroll compressors
Oil-free tooth and scroll compressors are used
in industrial and medical applications with a
demand for high-quality oil-free air. Some
models are available as WorkPlace AirSystem
with integrated dryers, as well as with energy-
ecient variable speed drive (VSD).
Rotary screw compressors
Rotary screw compressors are available as oil-
injected and oil-free. They are used in numerous
industrial applications and can feature the Work-
Place AirSystem with integrated dryers, as well as
the energy-ecient variable speed drive (VSD)
technology and energy recovery kits.
Oil-free blowers
Oil-free blowers are available with dierent tech-
nologies: rotary lobe blowers, rotary screw blow-
ers and centrifugal blowers. Blowers are used in
process industry applications with a demand for
a consistent ow of low-pressure air, for example
in wastewater treatment and conveying.
Oil-injected
screw compressor
with variable
speed
All-in-one Oxygen
Concentrator
System providing
medical oxygen
Oil-free gas screw compressors
are essential equipment aboard
Liqueed Natural Gas vessels
Atlas Copco oers all major air compression technologies as well as air and gas treatment equipment, and
air management systems and is able to oer customers the best solution for every application.
INNOVATIONS DURING 2022
Several new products were intro-
duced during the year, including:
Atlas Copco inPASS, a new range of
compressed air lters that help cus-
tomers to optimize the air quality and
protect equipment in production.
BD 360
+
–1260
+
(ZP), a new range of
desiccant dryers oering increased
ow, higher energy eciency and
hence lower CO
2
emissions.
ZT30–50VSD
+
, a new range of oil-
free tooth compressors oering com-
pact design, low noise, and 15% more
energy eciency compared to the
previous generation.
H2P reciprocating hydrogen
compressor developed mainly
for pipeline injection and storage
applications oering high energy
eciency and exibility due to
modular design.
Gas and Process,
President
Robert Radimeczky
MANAGEMENT
Compressor Technique, January 1, 2023
Business Area
President
Vagner Rego
Compressor
Technique Service,
President Dirk Beyts
Industrial Air,
President Joeri Ooms
Oil-free Air, President
Philippe Ernens
Professional Air,
President Alain Lefranc
Medical Gas
Solutions, President
Ben Van Hove
Airtec, President
Wouter Ceulemans
Oil-free centrifugal compressors
Oil-free centrifugal compressors are used in
industrial applications that require constant, large
volumes of oil-free air. They are also called turbo
compressors.
Gas and process compressors, expanders
and pumps
Gas and process compressors, expanders and
pumps are primarily supplied to the energy indus-
tries (including oil and gas, conventional and
renewable power generation, hydrogen etc.), as
well as industrial gases. The main equipment solu-
tions are single- and multi-stage centrifugal com-
pressors, expanders and pumps, complemented
by oil-free gas screw compressors used by the
Marine and LNG carrier industry.
Air and gas treatment equipment and
medical air solutions
Dryers, coolers, gas puriers and lters are sup-
plied to produce the right quality of compressed
air or gas. In addition, the oering includes solu-
tions for medical air, oxygen and nitrogen genera-
tion as well as systems for biogas upgrading.
Principal product development and
manufacturing units are located in:
Belgium, the United States, China, India,
Germany and Italy.
Atlas Copco 2022 23
THE YEAR IN REVIEW – COMPRESSOR TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
• Compressor Technique
Vacuum Technique
Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
• Vacuum Technique
Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Vacuum Technique
The market for vacuum equipment and related service was strong, although the demand from the semiconductor industry
decreased during the latter half of the year, resulting in an overall decrease in order intake. The business area made several
acquisitions, intensied its focus on innovation, and made further investments in operations to better support customers’
need for equipment and services.
Market development
The overall demand for vacuum equipment and
services remained high even if the demand from
the semiconductor and at panel display indus-
try decreased sharply during the latter half of the
year, resulting in an overall order decrease of 8%
organically.
The service business achieved solid order
growth, supported by increased demand from the
semiconductor industry and industrial customers.
The order intake increased in all major regions.
Order volumes for equipment, however,
decreased as a result of a markedly weakened
demand from the semiconductor and at panel
display industry during the third and fourth quar-
ters. This was primarily driven by lower invest-
ment levels by memory manufacturers. The order
intake decreased signicantly in all regions except
Europe, where order volumes increased. Order
volumes for equipment to industrial and scientic
vacuum applications increased considerably with
solid growth in all regions.
Market presence and organizational
development
The business area continued to focus on inno-
vation with further investments in research and
development. Several new innovative prod-
ucts were introduced, targeting both the semi-
conductor and at panel display market, and the
industrial and scientic vacuum market. The mar-
ket presence was strengthened, and the product
oering was expanded as a result of several acqui-
sitions during the year. Resources were also added
in sales and marketing, particularly aimed at the
industrial and scientic vacuum market.
The business area supported customers in
Sales bridge Orders received Revenues
2021, MSEK 39 529 29 219
Structural change, % +1 +2
Currency, % +11 +15
Organic*, % –8 +16
Total, % +4 +33
2022, MSEK 41 213 38 941
* Volume, price and mix
Revenues,
MSEK
38 941
2021: 29 219
Operating
prot margin
21.6%
2021: 24.2%
Return on capital
employed
24%
2021: 25%
0
12 000
24 000
36 000
48 000
60 000
20222021202020192018
0
5
10
15
20
25
MSEK
%
Orders received, revenues
and operating margin
Orders received, MSEK
Revenues, MSEK
Operating margin, %
reducing their environmental footprint through
increased delivery of energy-ecient products.
To reduce the environmental footprint of its own
operations, the business area increased the share
of renewable energy contracts, particularly in
China and South Korea.
Continued eorts were made to strengthen
the business area’s digital capabilities, and to
service and support customers through connec-
tivity. One example was the further development
and rollout of the remote monitoring systems
for vacuum pumps Edcentra and GENIUS Instant
Insights™.
Several investments were made in operations
in order to increase the presence and closeness
to customers. For example, the business area
invested in a service technology center in Lang-
fang, China, in new distribution centers in South
Korea and Japan, a manufacturing facility in Asan
City, South Korea, a remanufacturing and assem-
bly facility in Chandler, USA, and in a cryopump
manufacturing and R&D facility in Haverhill, USA.
The business area made in total eight
acquisitions in 2022:
• HHV Pumps Pvt. Ltd., an Indian vacuum pump
provider with 151 employees and revenues of
approximately MSEK 53.
• National Vacuum Equipment Inc., a US manu-
facturer of mobile vacuum pumps and packages
with 100 employees and revenues of approxi-
mately MSEK 223.
• Ceres Technologies, Inc., a US-based manufac-
turer and designer of gas and vapor delivery
equipment for the semiconductor industry,
with 185 employees and yearly revenues of
approximately MSEK 351.
• Shandong Jinggong Pump Co., Ltd, a Chinese
manufacturer of industrial vacuum pumps and
systems with 100 employees and yearly reve-
nues of approximately MSEK 102.
• Montana Instruments Corporation, a US-based
cryostat manufacturer with 38 employees and
yearly revenues of approximately MSEK 106.
The following acquisitions were also made:
• Tekser Endüstriyel Cihazlar Sanayi ve Ticaret A.Ş,
a Turkish distributor service provider.
• Qolibri Inc., a US-based provider of semi-
conductor subfab solutions.
• Les pompes à vide TECHNI-V-AC inc., a Canadian
vacuum distributor and service provider.
For more information see page 73.
Revenues, prots and returns
Revenues increased 33% to MSEK 38941
(29219), corresponding to a 16% organic increase.
The operating prot increased 19% to MSEK
8407 (7066), corresponding to a margin of 21.6%
(24.2). The main explanations for the lower mar-
gin were higher costs related to supply chain
constraints, ineciencies in factories, and costs
associated with Covid-19. The last was primarily
during the rst half of the year. Return on capital
employed was 24% (25).
Atlas Copco 2022 24
THE YEAR IN REVIEW – VACUUM TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
• Vacuum Technique
Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
The market
Vacuum and abatement solutions are required
in a number of applications where the pressure
needs to be below atmospheric pressure and/or
the environment needs to be clean.
The Vacuum Technique business area sells prod-
ucts, systems and services across several targeted
market sectors.
The market can be categorized into semicon-
ductor, industrial vacuum and scientic vacuum.
However, each of these sectors contains several
sub-sectors and specic applications.
Vacuum products include a broad range of
dry pumps, turbomolecular pumps and other
vacuum pumps. These are used to create highly
controlled, low-pressure, particle-free environ-
ments in a diverse set of manufacturing processes.
Such processes include semiconductor, at panel
display, LED and solar, glass and optical coating,
scientic instruments used in life sciences,
research institutes focused on renewable energy,
high-energy lasers and nanotechnology, pharma-
ceuticals, heat treatment, lithium-ion batteries,
and food processing and packaging.
Abatement systems include stand-alone and
customized solutions which integrate vacuum and
exhaust management technologies. Abatement
is required both to prevent adverse chemical re -
actions within production processes and to com-
ply with strict regulatory emission controls. The
business area also provides value-added services
including equipment monitoring, eld and on-site
servicing, remanufacturing, service upgrades and
provision of spare parts and oils.
Other, 2%
General manu-
facturing, 12%
Process
industry, 23%
Electronics, 63%
Asia/Oceania, 61%
North
America, 23%
Africa/
Middle East, 1% Europe, 15%
Equipment, 78%Service, 22%
Market trends
• Increased use of demanding materials and
extreme working temperatures in processes
for semiconductor and industrial production
• Focus on energy-eciency
• Stricter regulatory emission standards
• Increased demand for digitally supported
service oers
• Focus on total solutions and total life-cycle cost
• Focus on circularity as a sustainability solution
Demand drivers
• Industrial production
• Manufacturing of semiconductors, research and
development equipment, lithium-ion batteries,
at panel display and solar energy products
• Demand for energy-ecient vacuum pumps
• Increase in vacuum requirements to support
new production processes
Vision and strategy
The vision is to be First in Mind—First in Choice
for vacuum and abatement solutions. The
strategy focuses on technology leadership,
market leadership and agility, to support
growth. This is done by focusing on product
research and development programs together
with deployment of highly innovative products
and services. Continued execution of market
leadership will be done by an organization
focused on agility, growing market share in our
traditional heartlands and further expansion of
the geographical footprint.
Additionally, the business area has a strong
focus on developing the service business and an
ecient and exible global operations footprint.
Strategic activities
• Increase market coverage and improve presence
in targeted markets and segments
• Fast introduction of highly innovative products
and services oering better value and improved
energy eciency
• Increased market penetration and coverage
through brand portfolio management
• Perform more service on a higher share of the
installed base of equipment
• Invest in service presence close to customers
• Increase organizations’ agility and operational
eciency
• Invest in people and competence development
• Grow through strategically attractive
acquisitions
Competition
Vacuum Technique’s principal competitors are:
Semiconductor market:
DAS Environmental Expert, Ebara, Kashiyama,
Pfeier Vacuum, Shimadzu Corporation.
Industrial and scientic market:
Ingersoll Rand, Pfeier Vacuum, and Busch.
Market position
A global market leader for vacuum and
abatement solutions.
Atlas Copco 2022 25
THE YEAR IN REVIEW – VACUUM TECHNIQUE
Orders received by
customer category
Revenues by region Share of revenues
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
• Vacuum Technique
Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Vacuum Technique: Products and applications
Oil-sealed rotary vane vacuum pumps
The latest generation of oil-sealed rotary vane
pumps has been rened to produce a better qual-
ity of vacuum while extending the pressure range
over which the pump can operate. They are used
in a wide variety of industrial, and research and
development applications.
Dry vacuum pumps
Dry pumps are oil-free pumping mechanisms to
create vacuum environments. They use no lubri-
cants within the pumping mechanism and have a
series of available monitoring and control options.
Dry pumps are used extensively in many semicon-
ductor applications, as well as in industrial pro-
cesses such as metallurgy, coating, drying, mobile
applications and solar. They are also used in scien-
tic instruments such as scanning electron micro-
scopes.
Turbomolecular pumps
In turbomolecular pumps, or turbo pumps, a
turbine rotor spins rapidly to create vacuum. The
dening feature of a turbo pump is the high rota-
tional speed. These pumps are typically used in
conjunction with primary wet or dry pumps.
They are commonly used in semiconductor appli-
cations, research and development, industrial
applications and high energy physics.
Liquid ring vacuum pumps
Liquid ring pumps are equipped with a xed blade
impeller. As the impeller rotates, the liquid forms a
ring around the circumference of the casing. Stan-
dard liquid ring vacuum solutions are perfect for
use in humid, dusty and dirty environments com-
monly found in industrial processes, including
food and beverage, mining, chemicals, oil, steel,
cement, plastics and textiles.
Dry vacuum pump for analysis applications
and research laboratories
Integrated abatement system used
in the semiconductor industry
Cryogenic pump
The Vacuum Technique business area oers an extensive range of
vacuum and abatement solutions to the market.
Abatement and integrated systems
Abatement systems are used to manage gases
and other process by products from dry pump
exhaust. Abatement is required to prevent
adverse chemical reactions with production pro-
cesses and to comply with strict regulatory emis-
sion controls. Abatement and integrated systems
are primarily used in semiconductor, at panel
display, solar and LED applications.
Cryogenic pumps
Cryogenic pumps create vacuum by condens-
ing (freezing) gas onto special arrays of cryogen-
ically cooled surfaces within the pump envelope.
The temperature of the surfaces can be below
20K/–250°C to enable the capture of most gas
species. Cryogenic pumps are used in a spectrum
of high-technology research applications as well
as in manufacturing of semiconductor, at panel
and optical devices.
Principal product development and
manufacturing units are located in:
The United States, Mexico, the United Kingdom,
Czech Republic, Germany, South Korea,
China and Japan.
INNOVATIONS DURING 2022
Several new products were introduced
during the year, including:
A new generation variable speed drive
oil-injected vacuum pumps, GHS 1402
2002VSD+, targeting industrial vacuum
applications and oering optimal oil
separation and a small footprint.
A new cryogenic pump, the Edwards
CTI On-Board® IS 320F XVS, oering high
performance and solid vacuum consistency
while providing real-time system informa-
tion for optimum temperature control.
A new module for integrated vacuum
and abatement systems, the Hydrogen
Dilution (H2D), providing signicantly
lower energy consumption and lower
carbon footprint compared to other
solutions in semiconductor processes.
A new innovation for improved abatement
product performance, the Porous Head
Technology, available for both new equip-
ment and service upgrades, oering
increased eciency and abatement
uptime for customers.
MANAGEMENT
Vacuum Technique, January 1, 2023
Business Area
President
Geert Follens
Vacuum Technique
Service, President
Eckart Roettger
Semiconductor
Service, President
Troy Metcalf
Semiconductor,
President
Kate Wilson
Semiconductor
Chamber Solutions,
President
Martin Tollner
Scientic Vacuum,
President
Carl Brockmeyer
Industrial Vacuum,
President
Koen Lauwers
Atlas Copco 2022 26
THE YEAR IN REVIEW – VACUUM TECHNIQUE
Industrial Technique
The demand for equipment and service was strong, and order volumes to automotive and general industry customers increased
in all regions. Several new products were introduced to the market, investments were made in research and development and in
digital presence. The focus on how to support customers in reducing their environmental footprint was also intensied.
Market development
The overall demand for equipment and services
increased markedly, supported by increased
investment activity in both the automotive
and general industry. In total, the order intake
increased 17% organically.
Order volumes for the service business
increased with solid growth in all regions.
The demand for industrial assembly and
vision solutions to the automotive industry
increased signicantly, and the order intake
increased in all regions. The strong order growth
was primarily driven by customers’ increased
investments in electric vehicle production.
Order volumes for industrial assembly and
vision solutions to the general industry increased,
supported by an increased demand from most
customer segments, and growth in all regions.
Market presence and organizational
development
The business area continued to invest in innova-
tion and further strengthened its product port-
folio by introducing several new products to the
market during the year.
The service oering was strengthened through
the rollout of a cloud-based data analytics oer,
enabling customers to optimize their processes
and equipment maintenance. The business area
also intensied its focus on reducing the environ-
mental footprint by, for example, an increased
use of recycled material in new products and
through the launch of a new activity concept help-
ing customers in their sustainability ambitions and
to reduce their CO
2
emissions.
Sales bridge Orders received Revenues
2021, MSEK 20 545 19 421
Structural change, % –1 +0
Currency, % +11 +10
Organic*, % +17 +8
Total, % +27 +18
2022, MSEK 26 070 23 007
* Volume, price and mix
Revenues,
MSEK
23 007
2021: 19 421
Operating
prot margin
20.0%
2021: 20.5%
Return on capital
employed
17%
2021: 16%
0
10 000
20 000
30 000
20222021202020192018
0
10
20
30
MSEK
%
Orders received, revenues
and operating margin
Orders received, MSEK
Revenues, MSEK
Operating margin, %
Investments were made in new machining equip-
ment in the production facility in Tierp, Sweden,
in a new innovation center for battery production
and electronics in Neustadt, Germany, and a new
production and R&D facility in Shanghai, China.
The business area made one acquisition
in 2022:
Soft2tec GmbH, a German company specialized
in camera-based tracking systems used for opera-
tor guidance, with 38 employees and revenues of
approximately MSEK 20.
For more information see page 73.
Revenues, prots and returns
Revenues increased 18% to 23 007 (19 421), cor-
responding to an 8% organic increase. The oper-
ating prot increased 16% to MSEK 4597 (3976),
and the operating margin reached 20.0% (20.5).
Increased costs related to supply chain con-
straints, Covid-19 in the rst half of the year,
and stock adjustments and provisions, aected
the margin negatively. Currency had a positive
eect on the operating margin. Return on capital
employed was 17% (16).
Atlas Copco 2022 27
THE YEAR IN REVIEW – INDUSTRIAL TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
Vacuum Technique
• Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
The market
The global market for industrial power tools and
assembly systems with related services has a large
number of participants with a wide range of prod-
ucts in dierent applications such as assembly
of parts, drilling and material removal. Custom-
ers are found in industries such as the automo-
tive industry, o-highway vehicles, the electronics
industry, aerospace, appliances, the energy sector,
and general industrial manufacturing. In particu-
lar, the business area has been successful in devel-
oping advanced electric industrial tools and sys-
tems that assist customers in achieving fastening
according to their specications and minimizing
errors and interruptions in production.
With an increasing demand for electric cars,
battery production, and a growing use of lighter
materials, the automotive industry looks to inno-
vative assembly solutions. The market demands
new assembly technologies such as dispensing of
adhesives and sealants and self-pierce riveting.
The market for machine vision becomes increas-
ingly important, driven by a growing demand for
automation, quality and productivity in indus-
trial production. Machine vision solutions are used
in discrete production, such as the automotive
industry, and in continuous processes production,
such as metal and paper production, advanced
material manufacturing, and solar panels.
Other, 11
%G
eneral manu-
facturing, 21%
Construction, 2%
Service, 6%
Electronics, 4%
Automotive, 51%
Process industry, 5%
Asia/Oceania, 31% North
America, 32%
Africa/
Middle East, 2%
Europe, 33%
South
America, 2%
Equipment, 73%Service, 27%
Market trends
• Automation in customers’ production
• Digitalization and demand for connectivity
in production
• Increased customer focus on reducing CO
2
emissions
• Increased demand for electric vehicles
• Higher requirements for productivity, exi bility
and ergonomics, and increased demand for
in-line quality control
• Increased focus on renewable energy and
storage
• Use of light-weight material in transportation-
related industries
Demand drivers
• Capital expenditure for automotive and
general industrial production
• Increased production capacity
• Customer investments in new production
lines for new products
• Customer investments in more ecient
production
• Operational expenditure in automotive and
general industry, e.g. quality assurance and
exible automation
• Investments in customer segments’ contribu-
tion to transformation to a low-carbon society
Vision and strategy
The vision is to be First in Mind—First in Choice as
a supplier of industrial power tools, joining and
dispensing solutions, machine vision, and related
services. The strategy is to continue to grow the
business protably by building on technological
leadership and continuously oering products
and services that improve customers’ productivity,
exibility, quality, energy eciency, safety, and
ergonomics. Key strategic initiatives include adjust-
ing the product oer to meet increased automa-
tion in customers’ production processes, and pro-
viding additional service, know-how and training.
The business area is also increasing its presence
in targeted geographical markets. The presence is
enhanced by a brand portfolio strategy. The busi-
ness area is actively looking at acquiring comple-
mentary businesses. Growth should be achieved
in a way that is economically, environmentally and
socially responsible.
Strategic activities
• Increase market coverage and improve presence
in targeted markets/segments
• Develop new innovative products and solutions,
oering increased quality and productivity, and
improved ergonomics
• Develop products helping customers to reduce
their environmental impact
• Further increased focus on automation and
digitalization, through connected products and
solutions, to support customers’ productivity
and exibility
• Increase the share of proactive services and the
share of service on the installed base
• Increase operational eciency
• Invest in people and competence development
• Acquire complementary businesses and
integrate them successfully
Competition
Industrial Technique’s principal competitors are:
Industrial tools business:
Apex Tool Group, Ingersoll Rand, ESTIC, and
Bosch, as well as several local and regional
competitors.
Adhesive and sealant equipment:
Nordson, Graco, Viscotec, BD Tronic, and Dürr.
Self-pierce riveting:
Stanley Black & Decker, and Böllho.
Machine vision:
Zeiss, ISV, Coherix, Ametek, and Dr. Schenk.
Market position
A leading market position globally in most of its
operations.
Orders received by
customer category
Revenues by region Share of revenues
Atlas Copco 2022 28
THE YEAR IN REVIEW – INDUSTRIAL TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
Vacuum Technique
• Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Industrial Technique: Products and applications
Industrial assembly tools and solutions
Advanced assembly tools and systems are used in
the automotive industry and general industrial pro-
duction such as aerospace, o-highway, and elec-
tronics. The business area provides a broad range
of pneumatic, hydraulic and electric assembly
tools, control systems, and associated software for
safety-critical tightening. These systems gener-
ally allow customers to collect, record, and process
assembly data in their production.
Self-pierce riveting solutions, adhesive
dispensing and ow drill fastening equipment
Self-pierce rivets, adhesive, and ow-drill fasten-
ers are primarily used in the automotive indus-
try driven by increased use of light materials in
car manufacturing. The business area oers self-
pierce riveting tools and rivets, dispensing equip-
ment for adhesives and sealants, as well as ow-
drill fastening equipment.
Adhesive dispensing
system with an integrated
vision system
Vision system for quality control
The Industrial Technique business area oers the most extensive range of industrial
power tools, assembly systems, and machine vision solutions on the market.
Handheld battery
tool for assembly
applications
MANAGEMENT
Industrial Technique, January 1, 2023
INNOVATIONS DURING 2022
Several new products were introduced
during the year, including:
A new screw feeding system, based on
standardized modules for tailor-made
design, that will support customers to
improve quality, uptime, and productivity
in production.
The ILS 2.0, a new positioning system for
Atlas Copco’s battery assembly tools using
machine vision technology to track tool
position generating increased production
quality and remained exibility.
The STRwrench, a new handheld torque
wrench with connectivity features,
supporting customers to increase exibility
and reduce errors in their production.
A new high-performance dispenser, the
DosP DP2001, supporting customers in
reducing process times when applying
sealants, adhesives, or potting materials
in customers’ production.
Business Area
President
Henrik Elmin
Industrial Technique
Service, President
Håkan Andersson
Motor Vehicle
Industry Tools and
Assembly Systems,
President Lars Eklöf
General Industry
Tools and Assembly
Systems, President
Carl von Schantz
Chicago Pneumatic
Tools, President
Ivo Maltir
Industrial Assembly
Solutions, President
Berthold Peters
Machine Vision
Solutions, President
Tomas Lundin
Material removal tools, drills and other
pneumatic products
Pneumatic and electric industrial grinders, drills
and percussive tools are used in several industrial
applications, for example in metal fabrication
and aerospace production. The business area also
oers airline infrastructure for optimization of
pneumatic tools, and air motors that are used as
drive units in various industries and applications.
Machine vision solutions
Machine vision is a key technology for industrial
automation and digital manufacturing. The oer
is focused on quality control of surface inspection
and 3D vision systems for in-line metrology, qual-
ity control, and robot guidance. The combination
of high-performance cameras, illumination, and
vision and analytics software, allows customers in
a broad range of industries to improve quality and
automate production.
Principal product development and manufacturing units are located in:
Sweden, Germany, Hungary, the United Kingdom, France, China, Japan, and the United States.
Atlas Copco 2022 29
THE YEAR IN REVIEW – INDUSTRIAL TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
Vacuum Technique
• Industrial Technique
Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
Vacuum Technique
Industrial Technique
• Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Power Technique
The demand for equipment, service, and specialty rental solutions was strong, and signicant order growth was
achieved in most regions. The business area continued to invest in research and development, digital capabilities, and
solutions that can reduce customers’ environmental footprint. In addition, through the acquisition of Lewa GmbH,
the product oer for the industrial pump market was strengthened signicantly.
Market development
The overall demand for equipment, service
and specialty rental solutions increased signi-
cantly. Order volumes increased strongly in all
regions, except Asia, where they were essentially
unchanged. In total, the order intake increased
18% organically.
Order volumes for the specialty rental business
increased noticeably throughout the year, sup-
ported by increased demand in all regions,
particularly in North America. The demand for
service also increased, and solid order growth
was achieved in all regions.
Equipment orders increased sharply, driven
primarily by an increased demand from equip-
ment rental companies in the rst half of the year.
Demand was also strong during the second half of
the year, both from equipment rental companies
and end users. Order volumes increased for porta-
ble compressors and power and ow equipment,
such as generators and pumps.
Market presence and organizational
development
During the year, the business area continued to
invest in innovation and market presence in tar-
geted markets and segments. One example of
increased geographical presence was the opening
of three new rental depots for the Specialty Rental
business.
Several new innovative products were intro-
duced during the year. Through the acquisition of
Lewa GmbH, the product oer for the industrial
pump market was signicantly strengthened.
Sales bridge Orders received Revenues
2021, MSEK 15 155 13 234
Structural change, % +13 +15
Currency, % +13 +13
Organic*, % +18 +16
Total, % +44 +44
2022, MSEK 21 783 19 053
* Volume, price and mix
Revenues,
MSEK
19 053
2021: 13 234
Operating
prot margin
18.5%
2021: 16.0%
Return on capital
employed
25%
2021: 27%
0
5 000
10 000
15 000
20 000
25 000
20222021202020192018
0
5
10
15
20
25
MSEK
%
Orders received, revenues
and operating margin
Orders received, MSEK
Revenues, MSEK
Operating margin, %
Thanks to an increased number of connected
products oered to the market, the ability to sup-
port and provide service to customers increased
further during the year. To support the Specialty
Rental business, investments were also made in a
new ERP and CRM system.
The continued investment in eco fuel (HVO)
for equipment testing is one example of how the
business area further reduced the environmental
footprint in its own operations. The further rede-
sign of products to be electrically powered is an
example of how the business area works to sup-
port customers in their sustainability ambitions.
The business area made three acquisitions
in 2022:
• Pumpenfabrik Wangen GmbH, a German
manufacturer of progressive cavity pumps
used for transferring uids mainly in the bio-
gas and wastewater sectors. The company had
265 employees and annual revenues of about
MSEK466.
• LEWA GmbH and subsidiaries, a German manu-
facturer of diaphragm metering pumps, process
pumps and complete metering systems, with
around 1 200 employees and annual revenues
of about MSEK 2400.
• Geveke B.V. and subsidiaries, a company that
distributes compressors and engineers
advanced and complex process pump installa-
tions, with 173 employees and annual revenues
of about MSEK 648.
For more information see page 73.
Revenues, prots and returns
Revenues increased 44% to MSEK 19053 (13234),
corresponding to a 16% organic increase. The
operating prot increased 66% to a record MSEK
3525 (2121), corresponding to a margin of 18.5%
(16.0). The main explanation for the higher oper-
ating margin was increased organic revenue vol-
umes. Costs related to supply chain constraints,
and Covid-19 in the rst half of the year, aected
the margin negatively. Currency had a small
positive eect on the operating margin. Return
on capital employed was 25% (27).
Atlas Copco 2022 30
THE YEAR IN REVIEW – POWER TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
Vacuum Technique
Industrial Technique
• Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
The market
The market for portable air, power and ow, and
industrial ow solutions includes a large number
of participants oering a comprehensive product
range for dierent applications. The Power
Technique business area focuses on a selected
number of applications.
Multiple segments are served by the business
area’s oering. General and civil engineering con-
tractors, often involved in infrastructure projects,
demand light construction tools. Mobile compres-
sors, generators, energy storage systems, light
towers, and pumps provide reliable power for
tools and applications in the construction sector.
In addition, the business area focuses on a number
of industrial ow applications through its meter-
ing and dosing pump product oer, and tempo-
rary air, power, steam, and nitrogen are oered to
the specialty rental market.
Market trends
• Higher requirements regarding productivity,
exibility and ergonomics
• Increased customer focus on reducing CO
2
emissions
• Increased customer focus on safety
• Equipment connectivity
• Increased demand for service support/
contracts
General manu-
facturing, 20%
Other, 17%
Construction, 39%
Service, 6%
Process
industry, 18%
Asia/Oceania, 18
%N
orth
America, 28%
Africa/
Middle East, 9%
Europe, 37%
South
America, 8%
Equipment, 56%Service, 14%
Service (Specialty
Rental), 30%
Demand drivers
• Infrastructure growth
• Investment in products that contribute to the
transformation to a low-carbon society
• Industrial production
• Emergency relief eorts
• Engine regulations
Vision and strategy
The vision is to be the First in Mind—First in Choice
provider of power and ow solutions for sustain-
able productivity.
The strategy is to grow by developing Atlas
Copco’s market position and presence as a global
supplier within portable compressors, pumps,
generators, and industrial pumps, as well as light
towers, along with a range of complementary,
market specic, niche products, such as high-
pressure boosters. The strategy also includes
further development of specialty-rental services
and of the service business; increasing revenues by
oering more services to more customers. Growth
should be achieved in a way that is economically,
environmentally and socially responsible.
Strategic activities
• Increase market coverage and improve
presence in targeted markets/segments
• Capture sales and service synergies
• Develop new sustainable products and
solutions oering enhanced productivity,
safety and reduced environmental impact
• Invest in design, development and production
capacity in growth markets
• Develop more competitive oerings with
dierent value propositions
• Perform more service on a higher share of
the installed base of machines
• Develop the service business
• Increase operational eciency
• Invest in employees and competence
development
• Acquire complementary businesses and
integrate them successfully
Competition
Power Technique’s principal competitors include:
The portable power market:
Doosan, Generac, Kaeser, and Sullair. In addition,
there are a large number of local and regional
competitors.
The industrial pump market:
Milton Roy, and Bran+Luebbe
Market position
A leading or strong market position globally
in most of its operations.
Orders received by
customer category
Revenues by region Share of revenues
Atlas Copco 2022 31
THE YEAR IN REVIEW – POWER TECHNIQUE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Compressor Technique
Vacuum Technique
Industrial Technique
• Power Technique
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Power Technique: Products and applications
Industrial ow
Positive displacement electric pumps are used in
a broad range of dierent industries.
Portable power
Portable generators fulll a temporary need for
electricity, primarily in construction applications.
Other common applications are power supply for
events, emergency power and power in remote
locations. Lighting towers provide light for safe
operations 24/7.
Portable ow
Portable electric and diesel-driven pumps as
well as sub mersible electric pumps, primarily
for water.
Portable pump
Diaphragm
metering pump
for industrial use
The Power Technique business area oers a range of products across multiple industries
including, industrial manufacturing, civil engineering, demolition, and exploration drilling.
MANAGEMENT
Power Technique, January 1, 2023
INNOVATIONS DURING 2022
Several new products were introduced
during the year, including:
A new pump range for dewatering and
industrial applications, PAC F/H, oering
high pumping performance and low
environmental footprint thanks to an
electrical motor.
A new drainage pump, the WEDA D95,
suitable for harsh conditions targeting
applications such as general dewatering,
mining, and tunneling.
A new portable oil-free compressor for the
specialty rental business, the PTE900 VSD
oering ecient airow in a compact
design and is developed to perform in
demanding environments.
A new range of portable compressors,
the X-AIR+ GIV, which oers reduced fuel
consumption by up to 15% compared to
previous models.
Portable electric compressor
Principal product development and manufacturing units are located in:
Belgium, Germany, Spain, the United States, China and India.
Business Area
President
Andrew Walker
Power Technique
Service, President
Stefaan Vertriest
Specialty Rental,
President Tim Last
Portable Air,
President Bert Derom
Power and Flow,
President Mikael Andersson
Portable air
Portable oil-injected compressors are primarily
used in construction applications where com-
pressed air is used as a power source for equip-
ment, such as pneumatic breakers and rock drills.
Portable oil-free compressors are rented by cus-
tomers to meet a temporary need for oil-free air,
primarily in industrial applications. Electric
portable air compressors generate less noise
than compressors with combustion engines
and are ideal for low-noise and emission zones
or indoor applications.
Construction and demolition tools
Hydraulic, pneumatic and gasoline-powered
breakers and drills used in construction,
demolition and mining businesses.
Atlas Copco 2022 32
THE YEAR IN REVIEW – POWER TECHNIQUE
A sustainable approach to delivering lasting value
At Atlas Copco, we are committed to being part of the solution for a better tomorrow. By integrating
sustainability into everything we do and by acting in an ethical way in all our operations and markets,
we bring value to both our customers and society as a whole.
Since 1873, our industrial ideas have empowered
our customers to grow and drive society forward.
We provide safe, reliable and energy ecient solu-
tions to customers in a wide range of industries
including manufacturing, construction, pharma-
ceutical, automotive and electronics.
Climate change is high on both our own and
many of our customers’ agendas. Our drive to
innovate with a lifecycle perspective supports
the development of highly energy-ecient prod-
ucts with reduced climate impact. Many of our
technologies and solutions are also used in indus-
tries and applications that are at the center of the
transformation to a low-carbon society. They are
critical in existing low-carbon technologies like
electric vehicles and solar power, and are also part
of emerging technologies for energy production,
energy storage, carbon capture, smart manufac-
turing, and more.
Sustainability focus areas
Sustainability is embedded in everything we do,
and we are committed to contribute to a sus-
tainable development. This means that we take
responsibility for managing the environmental,
economic and social impacts of our operations
and from our value chain.
We focus our eorts in the areas where we have
identied our largest impact and where we
deliver value for our key stakeholders. These are:
products and service, people, safety and wellbe-
ing, ethics, and climate and the environment.
Working systematically in these areas helps
us reach our mission of achieving sustainable,
protable growth while at the same time mitigat-
ing risks to our company and realizing business
opportunities.
New targets from 2022 onwards
Through the materiality analysis we conducted in
2021, we concluded that the climate, and related
sustainability issues such as carbon impact and
a lifecycle approach to product development, is
gaining increased attention. Diversity and inclu-
sion as well as talent development are also areas
where we see an opportunity for further progress,
and where our stakeholders would like to see us
focus our resources and eorts.
Based on this input we revised the sustainabil-
ity targets against which we measure our prog-
ress starting in 2022. These include science-based
targets to reduce our greenhouse gas emissions,
throughout the value- chain, in line with the Paris
Sustainability is embedded
in everything we do
PRODUCTS AND SERVICE
page 34
PEOPLE
page 37
SAFETY AND WELLBEING
page 39
ETHICS
page 40
CLIMATE AND ENVIRONMENT
page 42
Agreement. Read more about our sustainability
work and the progress we make in the following
sections, and in the sustainability notes on pages
126 –145.
Atlas Copco 2022 33
THE YEAR IN REVIEW – SUSTAINABILITY
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
• Sustainable approach
to delivering value
Products and service
People
Safety and wellbeing
Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Atlas Copco is a leader in developing innovative tech-
nologies and we continuously launch products, solu-
tions and services that set new industry standards. We
always innovate with a clear purpose in mind, in areas
where we believe we can make a dierence to our customers, the
environment and to society as a whole.
Atlas Copco’s products and services are developed to contribute to
our customers’ sustainability ambitions by optimizing their produc-
tivity, energy eciency, ergonomics and safety. Our technologies
and products are also found in several industries that are key in the
transformation to a low-carbon society. We develop leading tech-
nologies to customers in segments such as battery manufacturing,
hydrogen, wind power and solar energy, and are well positioned to
be a part in enabling this transformation.
Products in use generate most emissions
More than 90% of the CO
2
emissions from Atlas Copco’s value chain
are generated when the customers use our products. This is where we
have our biggest impact and we therefore focus on developing prod-
ucts and solutions that are more energy ecient than their predeces-
sors and with a lower carbon footprint over their entire lifecycle.
In 2021, we raised our ambitions in this area by committing to
reducing our greenhouse gas emissions in line with the Paris Agree-
ment. As part of this commitment we will reduce our indirect emis-
sions (scope 3), including the emissions when our products are in
use, in line with keeping the average global temperature rise well
below 2-degrees. We measure our progress against the new targets
starting 2022.
Innovating for a better tomorrow
At Atlas Copco, we always innovate with a clear purpose and in response to real challenges that our
customers are facing. Developing highly ecient and sustainable products that meet the needs of our
customers, the society and the planet is the biggest contribution we can make to a sustainable future.
harming greenhouse gases in industrial processes is another tech-
nology with positive environmental eect. The Halogenated Drug
Recovery (HDR), for example, is a solution for hospitals, that captures
halogenated (anesthetic) drugs via a centralized system into tanks,
where they are safely stored for nal conversion into a substance
with minimum environmental impact. In 2022, Atlas Copco’s
installed base of abatement products removed around 20 million
tonnes of CO
2
e emissions at customers’ facilities. Our partnerships in
recycling technologies for customers’ process gases can further
reduce their carbon footprint.
Increasing uptime and productivity
Increased connectivity and big data help transform the eciency
of many industrial processes. We support our customers in optimiz-
ing their production performance by monitoring and collecting real-
time data from the equipment to minimize downtime, predict main-
tenance needs and suggest energy-saving measures. One example
is the Smart Link data-monitoring system for compressors. A grow-
ing number of compressors are connected globally, enabling contin-
uous status monitoring and predictive maintenance.
Enabling the transition to renewable energy
Increasing the access to renewable energy will be key in reaching
a low-carbon society. Many of the technologies in this sector are
closely related to Atlas Copco’s products and solutions in vacuum
technology, compressor technology, energy storage and supply, as
well as in industrial production and inspection.
Designing with a lifecycle perspective
Atlas Copco takes a lifecycle approach to innovation. In 2020, we
adopted a Group- standard for how to, during the design phase,
measure a product’s carbon footprint throughout its lifecycle.
The Product Carbon footprint tool assesses the carbon impact of
dierent aspects, from choice of materials, to product use, as well
as from the product’s recycling and disposal.
All projects for new or redesigned products must have targets
for reduced carbon impact. In 2022, 97 percent of projects had such
reduction targets.
Reducing our customers’ footprint
Our customers request equipment, solutions and services that
increase productivity and lower their carbon footprint. Energy e-
ciency is at the core of the innovations in many of Atlas Copco’s prod-
ucts and even higher gains are possible through the support we pro-
vide on how to use our products and through our service oer. As
the majority of our products run on electricity, the impact from the
use-phase of our products, and consequently their value-chain foot-
print, is aected by the availability of renewable energy which dier
between countries and regions.
One of Atlas Copco’s most well-known and groundbreaking inno-
vations is the VSD (variable speed drive) technology used in com-
pressors. This is an example of an innovative technology that helps
customers optimize their energy eciency, while reducing both CO
2
emissions and costs. The VSD-technology is available in generators
and pumps, as well as in stationary and portable compressors.
Atlas Copco’s abatement systems that remove highly potent and
PRODUCTS AND SERVICE
Key performance indicators Target 2022 2021
Projects for new or redesigned products with goals for reduced carbon impact 100% 97% 98%
A Group common methodology for assessing the circularity of new or redesigned products In place by 2024
Atlas Copco 2022 34
THE YEAR IN REVIEW – SUSTAINABILITY: PRODUCTS AND SERVICE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
• Products and service
People
Safety and wellbeing
Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Vacuum, machine vision and abatement solutions, for example, are
essential in solar panel manufacturing. Vacuum pumps are needed
in the production of the silicon wafers and photovoltaic cells that
capture the sunlight and convert it into energy. The panel surface
must be awless in order to eciently capture the energy. Atlas
Copco develops optical inspection systems for complete control of
the panels, which helps improve their eciency and throughput.
In wind energy, Atlas Copco’s industrial tools, such as grinders,
wrenches and tensioners, are used in building the turbines, and our
generators are used to start them up.
Recovering and storing energy generated by renewable sources
presents a substantial challenge. This is an area where Atlas Copco has
the technology and expertise to take a leading position. One example
is the ZenergiZe battery-powered energy storage system that can be
combined with renewable sources of energy for immediate or later
use. It captures the energy and stores it for delivery at any given time.
Its intelligent control system then manages the energy oer and
demand to increase the eciency of hybrid power solutions.
Our service supports circularity and optimizes customers’
investments
Through a strong service oering we ensure that our customers get
the most out of each investment. Our service divisions ensure the
repair and reuse of products, extending their useful life and minimiz-
ing waste. They also provide support on how to optimally use the
products, which enables energy-eciency gains. The iXM Hybrid
upgrade service product is an example of an oering where custom-
ers can return their current pump to their local Atlas Copco service
technology center, where it is converted to use a low power mecha-
nism, thus reducing the pump’s CO
2
emissions.
Many of Atlas Copco’s products are also designed so they can be
returned, refurbished and resold. This contributes to increased circu-
larity and such used equipment meet the same high standards as
when they were new in terms of quality, performance and energy
eciency. Furthermore, some Atlas Copco units accept contami-
nated products, which otherwise would be disposed of as hazard-
ous waste, and return them to full operation.
Innovating for a better tomorrow, continued
Energy storage systems are mobile units
that use long-life lithium-ion batteries
to store and deliver energy at any given
point. As a standalone solution when us-
ing renewable energy sources, they oer a
silent, low-carbon solution with no fuel
consumption. They are also ideal for low
emissions and noise-restrictive applica-
tions, such as metropolitan construction
sites, events, telecom, mining, large power
plants and oshore.
When operated in hybrid mode, con-
nected with a power generator or any
other power source, energy storage
systems bring high levels of eciency
while minimizing costs and reducing the
environmental impact. Instead of a rath-
er large standalone power generator, hav-
ing an energy storage system involved in
the solution enables operators to choose
The global assembly industry is continuing its transformation be-
coming more ecient, integrated, and focusing on sustainability.
Tensor ITB-P will oer the opportunity to cover more applications
thanks to the pistol grip shape and increased ergonomics. The
Tensor ITB-P is a cordless tool, which shares an integrated control-
ler platform that manages the tool and real time integration to a
production system.
Substituting the traditional setup of one battery tool and one
physical controller box with the Tensor ITB-P, can reduce the life-
cycle carbon impact by 87 percent per year. Firstly, the setup with
an integrated controller eliminates the environmental impact in
the supply chain from producing and transporting physical con-
trollers. Secondly, Tensor ITB-P consumes less power while in use,
reducing both carbon footprint and costs for customers. The size
reduction of ITB-P benets the operators with lighter tool but is
also reducing by 50 percent, the number of battery cells used per
tool compared to previous generation of tools.
By replacing traditional systems, a tool and a separate control-
ler, with the Tensor ITB-P, savings can amount to around 1250
metric tons of CO
2
emissions per year. This is based on an
estimation of replacement of traditional
systems the coming two years.
The savings correspond to
the equivalent of around 270
gasoline-powered passenger
cars driven for one year in
the US.
Battery-based energy storage systems
New battery tool drives
smart assembly
Savings can
amount to around
metric tons of CO
2
emissions per year
1 250
in fuel
cost
savings
80%
a smaller-sized generator. This hybrid
solution optimizes the performance
level, especially when dealing with
unpredictable loads, extending the
unit’s working life.
An energy storage system working
together with a last-generation power
generator can save up to 80% in fuel
costs compared with an oversized tradi-
tional generator. Consequently, during
the solution’s lifetime, CO
2
emissions are
reduced by 30 metric tons. Rental eets
will be increasingly incorporating
energy storage systems, with an expect-
ed reduction of 120 000 metric tons of
CO
2
over a lifecycle – the equivalent of
the emissions produced by some 23500
gasoline-powered passenger cars driven
for a year in the US.
Up to
compared
with an
oversized
traditional
generator
Atlas Copco 2022 35
THE YEAR IN REVIEW – SUSTAINABILITY: PRODUCTS AND SERVICE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
• Products and service
People
Safety and wellbeing
Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Innovating for a better tomorrow, continued
Our semiconductor customers use EUV (extreme
ultraviolet) lithography technology to develop in-
creasingly intricate chips that are used for a wide
range of applications from cars and phones to at
panel display and LED lights. This technology re-
quires highly controlled, low-pressure, particle-free
environments.
Our semiconductor division is currently deploy-
ing a third generation EUV system which combines
the latest pumps and new H2D (hydrogen dilution)
abatement solution. This system is more energy
ecient compared with rst generation and helps
our semiconductor customer to avoid releasing
toxic gases into the atmosphere.
A new smart compressor … Reducing environmental impact in
semiconductor manufacturing
The third generation of Variable Speed Drive (VSD)
compressors, GA VSD
S
, is designed for sustainable
innovation thanks to its unrivaled energy eciency
compared to the previous generation. This makes
the GA VSD
S
a signicantly more energy ecient
compressor with lower carbon inpact.
Since Atlas Copco introduced the VSD technolo-
gy more than two decades ago, we have continued
to innovate in this technology. The result, the GA
VSD
S
, is the most ecient rotary screw compressor
Atlas Copco ever built. With energy savings up to
60 percent compared to xed-speed compressors,
it has a signicant impact on lowering the energy
consumption and the environmental footprint of
our customers.
In 2022, the Atlas Copco Group had 9 500 patents,
linked to around 2 600 inventions.
The GA VSD
S
is our rst compressor with smart
features, such as the Smart Temperature Control
(STC) system, which optimizes performance for any
application. The GA VSD
S
also comes with the new
Boost Flow Mode, which allows for exceeding the
compressor’s maximum capacity to ensure continu-
ity in our customers’ production.
One GA VSD
S
compressor unit saves 305 metric
tons of CO
2
over its lifetime compared to our cur-
rent xed speed compressor. If all 22 to 37 kW
xed-speed compressors worldwide upgraded to
this technology, an estimated 125 million metric
tons of CO
2
could be saved over the lifetime of the
compressors. This is the equivalent of 27 million
gasoline-powered passenger cars driven for a year
in the US.
Tests have demonstrated a nearly 50% reduction in
energy consumption, which represents a saving of
around 535 metric tons of CO
2
e by system per year,
the equivalent of 115 gasoline-powered passenger
cars driven for one year in the US.
The embedded H2D technology uses hydrogen
to dilute toxic gases produced in the manufactur-
ing process. This fuel-free abatement solution
delivers savings of 65 percent on energy consump-
tion, and reduces use of resources including water,
nitrogen, and compressed air.
50%
reduction
in energy
consumption
Tests demonstrate nearly
... with energy
savings up to
60%
Atlas Copco 2022 36
THE YEAR IN REVIEW – SUSTAINABILITY: PRODUCTS AND SERVICE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
• Products and service
People
Safety and wellbeing
Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Attracting and growing passionate people
Atlas Copco’s ambition is to be the most attractive employer in our industry and main markets. We nurture our culture
and enable the full potential of our people so they can deliver world-class solutions to our customers every day.
As a world-leading provider of innovative productivity
solutions, we aim to be First in Mind—First in Choice as an
employer in order to achieve sustainable business success.
This is only possible through attracting and growing
passionate people with a commitment to lifelong learning.
Every employee is critical to our success
Atlas Copco has developed a talent framework based on a common
set of competencies, rooted in our core values and beliefs, identied
as being the most critical to our business success.
The talent framework is relevant to all employees and breaks down
the competencies into behaviors that drive real change in employee
performance. It provides a common language that helps strengthen
our people practices and processes and emphasizes our belief that
every employee has a critical role in driving the Group’s success.
Developing passionate people
Atlas Copco has a strong culture of growing talent by encouraging
our employees to take accountability for their own development.
Our ambition is to learn with and from each other every day. To help
us do that, we create personalized and interactive learning opportu-
nities to drive upskilling for business and personal success.
Subject matter experts are recognized to support the Group
with knowledge transfer, fostering collaboration and peer-to-peer
learning. We encourage curiosity and enable learning through
continuous feedback and coaching.
The Group’s process for performance and development dialogues
is designed to increase the quality and frequency of feedback and
development dialogues, holding leaders accountable for growing
people through ongoing coaching.
Atlas Copco’s learning management system is another key enabler
for continuous learning. It provides access to an extensive library of
learning content, personalized and packaged to address specic
subjects, functions or roles.
Developing future-proof leaders
Developing future-proof leaders is another pillar of Atlas Copco’s
people philosophy. We strive to develop leaders who coach and
develop teams and individuals to reach their full potential through
inclusion, collaboration, and trust.
We dene leadership as the ability to create lasting results. Our
leadership portfolio oers personalized learning through a modular
set-up. Each module focuses on a specic skill mapped against the
competencies in our talent framework. During the year, new mod-
ules were designed focusing on building leadership resilience and
a growth mindset. We also focused on strengthening the pipeline
of senior leaders in the Group by investing in targeted competence
development for this group.
Attracting talent
To ensure a strong and diverse internal and external pipeline of can-
didates for available job positions, Atlas Copco seeks to proactively
PEOPLE
Key performance indicators Target 2022 2021 2020 Comment
Employees feel a sense of belonging in the company
1)
Above benchmark and a
continuous increase – – – Will rst be measured in 2023.
Employees agree there is opportunity to learn and
grow in the company
1)
Above benchmark and a
continuous increase (71) – 73 –
Measured through the employee
survey which is conducted every
two years.
Employees agree there is a work culture of respect,
fairness and openness
1)
Above benchmark and a
continuous increase (75) – 76 –
Share of female employees, by year end 30% by 2030 21.6% 20.9% 20.0%
1)
Scores are based on a scale 0–100 where 0 is “strongly disagree” and 100 is “strongly agree”.
attract talent from the entire pool of qualied candidates. Targeted
employer branding activities and data-driven recruitment prac-
tices using global sourcing tools, competency-based interviews and
assessment solutions, enable more informed decisions.
In 2022, we invested in educating our internal recruiting special-
ists in the areas of data-driven and inclusive recruitment, including
focus on driving awareness about bias in the recruitment process
and how to write more inclusive job ads to attract a more diverse
pool of candidates.
The biggest diversity gap across the Group is within gender
balance. We address this through a target of 30% women in the
Group by 2030. In 2022, progress was made towards a better gender
balance with 21.6% (20.9) women in the workforce by year end.
Committed to diversity and inclusion
We strongly believe that diversity and inclusion promotes innova-
tion, strengthens employee engagement and leads to better deci-
sion making. Our diversity and inclusion statement, “Diverse by
Atlas Copco 2022 37
THE YEAR IN REVIEW – SUSTAINABILITY: PEOPLE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Products and service
• People
Safety and wellbeing
Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
nature and inclusive by choice”, is used in all job
ads as well as in internal and external communica-
tion to show our commitment in this area. To drive
awareness about the impact of bias in the work-
place, learning content and guides to stimulate
team discussions, were developed and rolled out
globally in 2022.
Our Diversity and Inclusion Council, chaired by
President and CEO Mats Rahmström, includes rep-
resentatives from all business areas. The council
meets regularly to follow up on action plans and
results in the operations. The work is mainly driven
by business area task forces and ambassadors in
each operational entity.
Developing and strengthening our culture
Our culture is characterized by a commitment to
people, customers, solutions, and innovation. We
believe that there is always a better way of doing
things and advocate freedom with accountability.
Attracting and growing passionate people, continued
Enabling mobility through increased transparency
One of our most important priorities is professional de-
velopment through internal mobility. Our talent review
process gives us a good overview of the performance
and potential of our people. This helps us identify
business critical roles across levels in the organization,
securing a strong pipeline for these roles.
In 2022, we introduced a new digital solution for the
talent review process. The solution enables a more
transparent and exible data collection and output,
helping us make more informed and data driven
talent development decisions.
People analytics – powering
people decisions
In 2022, people analytics dashboards were
rolled out to our HR community, designed to
enable better decision making in all aspects
of our people strategy, through prescriptive
and predictive analysis. The dashboards
focus on recruitment, retention, diversity,
and learning & development, and have been
developed based on master data in our HR
and learning management systems. The
dashboards aim to analyze the eciency,
impact and eectiveness of our people
processes.
A better balance
Service has traditionally been a male-dominated area
within Atlas Copco, but the Compressor Technique
Service division has managed to break the trend.
After three years of focused eorts, the division now
has 65 female service technicians and ve female
Business Line Managers.
To succeed, a change of mindset has been neces-
sary. Creating awareness about why diversity and
inclusion matters and that it is not about reaching a
target, but rather about future business survival, has
been a critical starting point. The customer centers
have worked to become more attractive as employ-
ers by including diversity in their talent acquisition
and management plans. Employees have also been
trained to avoid bias and to break old perceptions of
what a service technician should be like. The nal fac-
tor has been to get the buy-in from all involved parties
to ensure a respect ful and inclusive environment.
The division and the customer centers have also
implemented actions, like gender neutral ads and
social media campaigns.
One Group, one culture
In 2022, we launched a new edition of The Book
about the Atlas Copco Group. It describes our com-
mon strategy, values and beliefs, and how we work
to fulll our purpose. The launch was followed by
workshops across the Group, enabling discussions
about our strategy, values, behaviors and how we
do business.
Several activities are carried out to support and
develop our culture such as recurring workshops
for employees on company values, strategy and
guidelines.
Atlas Copco conducts a global employee sur-
vey every two years. The survey brings import-
ant insights in four areas: employee engage-
ment, Group culture, safety and leadership. Our
most recent survey, in 2021, showed that our over-
all results were above the global benchmark. The
results of the survey are followed up in manda-
tory workshops lead by our managers, where con-
crete actions are shaped to further strengthen our
culture. The next survey will be conducted in 2023.
Supporting employees’ wellbeing is another
critical component to our success. In 2022, we
established and rolled out a new global wellbeing
framework, designed to provide a common struc-
ture to addressing the subject and facilitate initia-
tives across the Group. Read more on page 39.
We strongly believe that diversity and inclusion
promotes innovation, strengthens employee
engagement and leads to better decision making.
Atlas Copco 2022 38
THE YEAR IN REVIEW – SUSTAINABILITY: PEOPLE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Products and service
• People
Safety and wellbeing
Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
S
E
N
S
E
O
F
P
U
R
P
O
S
E
S
O
C
I
A
L
C
O
N
N
E
C
T
E
D
N
E
S
S
P
H
Y
S
I
C
A
L
W
E
L
L
B
E
I
N
G
M
E
N
T
A
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W
E
L
L
B
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I
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G
MY
WELLBEING
Committed to safety and wellbeing
We are committed to ensuring that our employees and others aected by our operations work in a way that
contributes to their safety and wellbeing. Transparent reporting is encouraged and helps build awareness of
risks and safe behavior preventing injuries in the workforce.
SAFETY AND WELLBEING
Key performance indicators Target 2022 2021 2020 Comment
A balanced safety pyramid
1)
Yes Yes Yes Yes
Employees agree that the company takes a genuine
interest in their wellbeing
2)
Continuous
increase – 73 –
The employee survey is conducted
every two years.
1)
Risk observations are included in the safety pyramid as of 2021.
2)
Scores based on scale 0–100 where 0 is “strongly disagree” and 100 is “strongly agree”.
Introducing a Group-wide
wellbeing framework
Wellbeing is dened as a sustainable state of feeling good and func-
tioning well in our lives and in our work. Our employees’ wellbeing is
a critical part of Atlas Copco’s culture and key to achieving business
success.
During the year, Atlas Copco introduced a Group-wide wellbeing
framework to help our leaders better understand the wellbeing
needs of their employees and how to support those needs. The
framework is designed to establish a common language about
wellbeing and to help facilitate dierent wellbeing initiatives.
The framework is made up of four areas; sense of purpose, social
connectedness, physical wellbeing and mental wellbeing. The areas
are connected, and actions taken to address one will likely have an
impact on another.
A complementing Wellbeing Guide is available that explains each
wellbeing area including its key components, and respective drivers
and threats. The guide also includes reference materials, such as play-
lists available on Learning Link, books and blogs. Furthermore, the
guide includes examples of initiatives on an individual, team and/or
operation level.
Safety and wellbeing are core priorities at Atlas Copco.
We pursue this by engaging everyone in eliminating haz-
ards, reducing occupational health and safety risks and
in promoting the immediate reporting of near-misses, incidents and
risk observations.
Robust safety standards in place
We are committed to providing a safe and healthy working environ-
ment for all our employees in all operations. The global SHEQ policy
(safety, health, environment and quality) ensures that there are
robust standards for safety and wellbeing in the workplace. We seek
to reinforce a culture and behaviors that contribute to the safety
and wellbeing of our people and others aected by our operations,
including contractors. This includes risk assessments and safety pro-
cedures, training, good environment within and around the work-
place, appropriate follow-up procedures, and transparent reporting.
The Group’s Safety, Health, Environment and Quality council over-
sees the work and supports the organization with the development
of policies, processes and best practice sharing.
Since Atlas Copco is highly decentralized, there may be regional
and local policies and practices that complement Group processes.
All divisions set targets and make action plans to enhance awareness
and improve behaviors, policies and processes. All companies in the
Group must have an Atlas Copco veried Safety, Health, Environ-
ment and Quality management system which is documented, imple-
mented and maintained on an ongoing basis. Annual Safety Days
have been arranged in the Group since 2014.
Following up our progress
Progress is measured by continuous safety reporting and follow-up,
and in the employee engagement survey every two years. The tar-
get is that an increasing part of employees should agree that Atlas
Copco takes a genuine interest in their wellbeing. The results from
the 2021 employee survey conrm this.
To further strengthen the safety work Atlas Copco measures prog-
ress by using a safety pyramid, with the target that the pyramid
should be balanced. This means that more reports of risk observa-
tions than near misses, more near misses than minor injuries, and
more or equal reports of minor injuries relative to recordable inju-
ries are reported. The approach supports transparent reporting, risk
awareness and encourages safe behavior to decrease risks and ulti-
mately prevent workforce injuries. In 2022, the result was in line with
this target. Read more on page 132.
Award to mental wellbeing program
Atlas Copco’s Safety and Health Award 2022 was presented to the Semi-
conductor Service Division, Global Field Service Teams for their i-act mental
wellbeing management training program.
The i-act training program is developed to support managers to pro-
actively improve workplace wellbeing as well as reactively support employ-
ees who may experience wellbeing or mental health issues at work. The pro-
gram has become mandatory for all line managers in the Vacuum Technique
business area and a global network of 25 i-act instructors has been created
to deliver the course to all managers in local language.
Atlas Copco 2022 39
THE YEAR IN REVIEW – SUSTAINABILITY: SAFETY AND WELLBEING
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Products and service
People
• Safety and wellbeing
Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
• Sustainable approach
to delivering value
Products and service
People
Safety and wellbeing
• Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Doing the right things in the right way
Acting with integrity throughout the value chain is more than just a matter of respecting laws and regulations
– it is a vital part of Atlas Copco’s culture. We have an unwavering commitment to the highest ethical standards,
including zero tolerance for human rights abuses and all sorts of corruption.
Atlas Copco aims to earn the trust of everyone
impacted by our operations, by building relation-
ships based on integrity, fairness and respect. We
expect the same high standards from our business
partners and work continuously to assess and reduce the risks asso-
ciated with our value chain.
Our ability to ensure that the highest ethical standards are applied
depends on the values and behavior of our people and business
partners. Therefore, we put signicant weight on communication,
training and monitoring to ensure awareness and adherence to our
values and principles. We also strongly encourage the reporting of
any potential misconduct through SpeakUp – our external whistle-
blowing system. This helps protect our values, the company, our
brand and each other.
Code of Conduct updated
Atlas Copco’s Code of Conduct sets out the fundamental ethical
values and principles of conduct which apply to all employees, busi-
ness partners and the Board of Directors. In 2022, the content of the
Code of Conduct was thorougly updated to reect changing stake-
holder expectations with new topics including modern slavery, risk
management, circularity, data protection and privacy, among others.
Training for employees worldwide
To make sure every employee is aware of the Code of Conduct and
what is expected of them, all employees are required to complete
a leader-led ethics training every two years. The new training will
be rolled out in 2023 instead of 2022 as previously communicated.
Every employee is also required to annually sign a Code of Conduct
compliance statement. By the end of 2022, 99% of our employees
had signed the statement.
New employees are required to participate in the ethics training
within 12 months of joining Atlas Copco. Performance against these
targets will be followed up annually.
Encouraging reporting of misconduct
To be able to uphold our ethical standards it is important that we
are made aware of any suspected breaches of laws or the Code of
Conduct. The whistleblowing solution, SpeakUp, is a channel for
employees or other stakeholders to raise concerns. Through the sys-
tem anyone can anonymously report potential misconduct in their
own language by a voice or text message. The system is operated by
an external third party and open 24 hours a day, 7 days a week.
The Code of Conduct includes a non-retaliation policy clearly stat-
ing that employees are encouraged to speak up about perceived
misconduct, and this will never lead to adverse consequences for the
individual, even if it results in the loss of business for Atlas Copco.
A responsible value-chain approach
Working with business partners who share Atlas Copco’s respect for
human rights and high standards for safety, quality, ethical behavior
and resource eciency is central to eciently manage risks and to
enhance productivity along the value chain.
Atlas Copco’s Code of Conduct is the backbone of the responsible
value-chain process, reinforced by a signed commitment by signif-
icant suppliers and distributors to follow it, screening and regular
on-site audits, customer sustainability assessments and targeted
training.
Sustainable sourcing practices
Atlas Copco has a large international supplier base, which presents
signicant challenges as risks can vary greatly between countries.
We use a risk-based approach and prioritize evaluating signicant sup-
pliers who represent the bulk of the purchase value or who operate
in markets with high corruption or human-rights risk.
Signicant suppliers are evaluated on parameters such as price,
quality and reliability as well as key environmental, social and ethical
ETHICS
Key performance indicators Target 2022 2021 2020
Employees sign the Group’s Code of Conduct compliance statement 100% 99% 98% 99%
Employees complete the biennial ethics training
1)
100% – – –
New employees participate in the ethics training within 12 months
1)
100% – – –
Signicant suppliers sign the Code of Conduct compliance statement 100% 93% 93% 93%
Signicant distributors sign the Code of Conduct compliance statement 100% 92% 87% 84%
1)
First measurement will be done in 2023 when the new training is launched.
Zero tolerance against corruption
Atlas Copco does not tolerate bribery or corruption in any form,
directly or through third parties. Firm actions will be taken on any
violation of the zero tolerance rule. It applies to all employees as well
as to the Board of Directors and to all business dealings and transac-
tions in all countries where Atlas Copco operates.
Corruption or facilitation payments are never acceptable in order
to secure a sale. This rule strengthens the brand and contributes to
fair market competition. There are no negative consequences, such
as demotion or other reprisals, for refusing to receive or pay bribes or
for reporting violations of our Code of Conduct.
Atlas Copco 2022 40
THE YEAR IN REVIEW – SUSTAINABILITY: ETHICS
HUMAN RIGHTS IN THE VALUE CHAIN
Atlas Copco’s Code of Conduct endorses the UN International Bill of Human Rights and guides our
employees in working with issues relating to ethical behavior, including human rights.
HUMAN RIGHTS RISKS
Business partners
Business partners not complying with
labor standards, including working
hours, forced/bonded or under-age
labor and the freedom of association.
Occurrence of conict minerals in
sourced products.
Atlas Copco’s own operations
Risks of violations including poor
working conditions and discrimina-
tion in the workforce. Operations in
countries with high risks of human
rights abuse, including corruption
and limited freedom of association.
Customers
Environmental impact and unsafe
use of products, including sub-
stances with potential health impact,
and risks of mismanaging customer
integrity. Risks related to local com-
munities, such as land rights.
Community
Risks of corruption and unethical tax
planning, impeding fair competition
and depriving people of their rights
to critical societal functions such as
healthcare and education.
POLICIES
Business partners
Atlas Copco has integrated the
UN Global Compact principles into
business partner evaluation and
management. Read more on
pages128–129 and 133.
Atlas Copco’s own operations
Group targets and policies aim to
create safe, healthy and fair working
environments. The human rights
statement and Code of Conduct.
Read more on pages 128–129.
Customers
Product safety and environmental
standards. The Group is strengthen-
ing its approach by implementing
the UN Guiding Principles on Busi-
ness and Human Rights. Read more
on pages 128–129 and 133.
Community
The Code of Conduct is the main
policy document on anti-corruption.
The Group’s tax policy is available
on the corporate website.
ACTIVITIES
Business partners
Prohibiting child labor and forced
labor, promoting adherence to inter-
national guidelines on working condi-
tions, environmental management
and freedom of association. Respon-
sible sourcing practices, which covers
the occurrence of conict minerals.
Atlas Copco’s own operations
Ensuring fair labor conditions, non-
discrimination in the workplace and
the right to join trade unions.
Training for all employees in the
Code of Conduct, including issues of
working conditions, labor rights
and discrimination.
Customers
Product safety, minimizing environ-
mental impact through usage of
products, security concerns and
issues related to community reloca-
tion. Customer assessment tool
and Compliance Board oversight
of policy implementation.
Community
Community engagement activities
increase access to health, education
and safe develop ment of children
and vulnerable groups, as well as
disaster relief. Training for all
employees in the Code of Conduct,
including on corruption.
aspects, including human rights. The parameters are based on the
UN Global Compact and the International Labour Organization’s
Declaration on Fundamental Principles and Rights at Work. On-site
visits are made to ensure compliance. See page 133.
All signicant business partners must commit to our Code of Con-
duct by signing a Business Partner Criteria document. The document
has been translated into more than 30 languages and is available
on the Group’s website. At the end of 2022, 93% of our signicant
suppliers had signed the compliance statement.
Distributors and agents
Atlas Copco also requires that all signicant distributors commit to
our Code of Conduct by signing the Business Partner Criteria docu-
ment. Distributors who represent the bulk of the sales value or who
operate in high-risk markets are prioritized. At the end of 2022, 92%
of our signicant distributors had signed the statement.
Sales compliance process
When relevant, we partner with customers to address risks in the
value chain. Atlas Copco’s customer assessment tool is used to iden-
tify and evaluate potential environmental, labor, human rights and
corruption risks. The assessment is complemented by in-depth
dialogue and eld visits.
General managers, and ultimately the divisional presidents, are
responsible for the implementation of Atlas Copco’s policies and
guidelines and making sales decisions. The Group’s Chief Legal
Ocer supports the organization on trade compliance matters,
including sanctions and export control. Since the beginning of
March 2022, Atlas Copco has paused all new orders for equipment
to Russia, except equipment that is used for humanitarian purposes,
such as hospitals.
Approach to human rights
Atlas Copco is committed to the UN Guiding Principles for Business
and Human Rights and have an ongoing process to identify, pre-
vent and mitigate the impact of our business on human rights. We
work throughout the value chain covering the rights of individuals
and groups who may be impacted by our activities or business rela-
tionships, see the table to the right. Atlas Copco’s Compliance Board
oversees the implementation of and compliance with the Code of
Conduct and our commitment to the UN Guiding Principles.
Doing the right things in the right way, continued
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
• Sustainable approach
to delivering value
Products and service
People
Safety and wellbeing
• Ethics
Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Fighting corruption is a central aspect to promoting human rights,
since corruption can undermine a government’s ability to fulll its
human rights obligations. In markets where the legal and political
system is a challenge, bilateral engagement with civil society is
crucial to successfully escalate human rights issues. Through mem-
berships in local business associations and in cooperation with other
actors, we collaborate to further Atlas Copco’s values within this
area.
Atlas Copco 2022 41
THE YEAR IN REVIEW – SUSTAINABILITY: ETHICS
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
• Sustainable approach
to delivering value
Products and service
People
Safety and wellbeing
Ethics
• Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Optimizing our environmental performance
Atlas Copco is committed to continuously improving our environmental performance and to being part of the
solution for a better tomorrow. We improve the energy eciency of our products and our operations, while also
managing our water use and waste. We have adopted science-based targets for the reduction of greenhouse gas
emissions, throughout the whole value chain.
Climate change presents a huge threat to society and
in 2021, we signicantly raised our ambitions by com-
mitting to reducing the greenhouse gas emissions
throughout our value chain in line with the goals of
the Paris Agreement. For Atlas Copco’s own opera-
tions, this means that we aim to reduce emissions in line with keep-
ing the global temperature rise below 1.5 degrees. We will also
reduce the emissions from our value chain in line with keeping the
temperature rise well below 2-degrees. The targets have been vali-
dated by the Science Based Targets initiative and have been imple-
mented during 2022.
The absolute majority of Atlas Copco’s impact is generated when
our customers use our products. Therefore we continue to develop
energy-ecient products with a lower carbon footprint over their
entire lifecycle. Read more on pages 34–36.
Reducing emissions in our own operations
In our eorts to reduce the impact of emissions from our own oper-
ations, we focus on energy-saving measures and on increasing the
use of renewable energy, for example by using biofuels in portable
compressor testing and installing solar panels. In 2022, the CO
2
emis-
sions from our own operations were 33% lower than in the baseline
year, 2019. Addressing emissions from our company vehicles pro-
vides further opportunity for reductions.
An increased share of renewable electricity was the main driver for
the lower emissions and some larger facilities switched to renew-
able energy during the year. In 2022, the share of renewable energy
used in the Group was 58%. However, in some markets, the availabil-
ity of renewable energy poses a challenge to our ability to increase
this share further.
Reducing emissions in our value chain
Our main climate impact comes from when customers use our prod-
ucts. Electrifying the product eet and increasing products’ energy
eciency will be our main focus in order to reduce our scope 3 emis-
sions. Logistics planning, switching to low carbon transport modes
and collaborating with transport partners are other priorities. In
2022, the absolute emissions in scope 3 were 29% higher than in
the baseline year. The main reason for this was increased sales, but
the availability of renewable energy to our customers has also been
lower than we expected.
Waste management
Reducing waste is important to decrease the total environmen-
tal impact from our production and increase circularity. Most of our
waste is constituted by scrap metal and the vast majority is reused or
recycled. This share has been consistently high for many years.
Our new target is that by 2030, we shall reuse, recycle or recover
100% of all our waste. This target is closely related to circularity,
keeping materials in a loop of re-use.
Water management
Atlas Copco’s overall water consumption is relatively low due to our
focus on assembly rather than on other resource-intensive activities.
Nevertheless, we seek to decrease our use of water and to increase
its reuse and circulation. Innovative product design and improved
processes also contribute to reducing our customers’ water use.
THE ENVIRONMENT
Key performance indicators Target 2022 2021 2020
Reduction in CO
2
e
1)
emissions (tonnes) from scopes 1 and 2, compared to the baseline 2019 –46% by 2030
2)
–33% –17% –2%
Reduction in CO
2
e
1)
emissions (tonnes) from scope 3, compared to the baseline 2019 –28% by 2030
3)
+29% +5% +1%
Signicant direct suppliers with an approved Environmental Management System Continuous increase 31% 31% 30%
Water consumption (m
3
)/in relation to cost of sales
4)
Continuous decrease 8.4 – –
Reused, recycled or recovered waste from internal operations
4)
100% by 2030 92% – –
Value-chain impact assessment
In 2021, the value chain impact assessment was conducted by calculat-
ing typical product CO
2
emissions in both the embodied impact, in
purchased material and by estimating the ‘in-use’ phase. The Group
Carbon Product Footprint tool was developed for this purpose. All
business areas completed the calculations of product-related and
non-product related emissions according to the Greenhouse Gas pro-
tocol, and the results were consolidated to Group-level. The scope 1, 2
and 3 CO
2
e emissions for 2019, 2020 and 2021 have been recalculated
based on the results from the value chain impact assessment.
1)
CO
2
e means carbon dioxide equivalent.
2)
In line with the 1.5 degree warming trajectory.
3)
In line with the 2.0 degree warming trajectory.
4)
New and extended scope from 2022, including all operations.
Atlas Copco 2022 42
THE YEAR IN REVIEW – SUSTAINABILITY: THE ENVIRONMENT
Environmental risks in the supply chain
Atlas Copco recognizes the importance of managing environmental
risks throughout the value chain. By committing to the business partner
criteria our suppliers take responsibility to minimize the environmen-
tal impact of products and services during manufacturing, distribution,
and usage, as well as after disposal. Screening and audits are part of the
Group’s supplier management system.
We work with tier-one suppliers using the business partner criteria
and, if needed, we develop action plans together to enhance the envi-
ronmental management of certain suppliers. To further reduce our
impact along the value chain, we measure the percentage of signicant
direct suppliers that have an approved environmental management
system. In 2022, 31% of these suppliers met this requirement. Read
more on page 130.
Environmental performance has long been in focus for Atlas Copco’s plant in
Tierp, Sweden. Energy-saving measures and transitioning to renewable energy
sources have been two priority areas, and 98 percent of the waste from scrap is
being recycled. Going forward, the strategy is to focus on reuse and circularity.
In the plant’s component workshop, steel bars are used as raw material.
The end pieces of these bars have previously been sent to recycling as scrap.
Following a suggestion from an employee, a project was set up in 2020 to investi-
gate whether the end pieces could instead be used as raw material in the socket
and bit production.
Two years later, approximately one third of the bar material used to produce
sockets and bits come from recycled end bits and both steel and brass bits are
reused instead of recycled. Apart from saving CO
2
emissions and material cost,
the project has other positive eects. The ready-cut end pieces reduce the need
for sawing which saves work time, energy and machinery. The need for transport
of both raw material and waste has also been reduced.
The new routine has led to an increased awareness of raw material usage and
waste and has resulted in other initiatives, such as reusing scrapped plastic trays
used for internal transport of components.
Water for All: Employee
community engagement
Water for All is the main community engagement initiative of both Atlas Copco
and Epiroc. The numbers convey Water for All’s global achievements in 2022
including both companies.
Water for All is Atlas Copco’s main community engagement initiative.
Through the dedicated and passionate work of volunteering employees,
Water for All funds projects which empower people through access to
clean drinking water, sanitation, and hygiene, thereby contributing to
healthy societies, free from conict and poverty. Women and young girls
are particularly aected by the lack of water and sanitation. All projects
supported by Water for All aim to positively impact the lives of women
and girls in particular. All employee donations are matched with twice as
much by the company.
In 2022, Water for All supported more than 65 water and sanitation
projects in 38 countries, in total reaching more than 250000 people.
During the spring, almost 30 Water for All organizations from all over the
world and the Peter Foundation Wallenberg Water for All Foundation
came together in a joint fundraising eort towards Ukraine. The donation
contributed to partner organization ADRA’s emergency relief activities in
the country, primarily within water, sanitation, and hygiene, which in total
reached more than 40000 people.
Optimizing our environmental performance, continued
Turning steel scrap into products
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
• Sustainable approach
to delivering value
Products and service
People
Safety and wellbeing
Ethics
• Environment
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Global climate event
Atlas Copco has committed to science-based targets to reduce our
greenhouse gas emissions in line with the Paris Agreement. It will take
everyone’s commitment, creativity and expertise to reach the targets.
To raise awareness, all employees were invited to a global climate
event in November 2022.
Atlas Copco 2022 43
THE YEAR IN REVIEW – SUSTAINABILITY: THE ENVIRONMENT
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
• Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Risks, risk management and opportunities
All business activities involve risks, therefore there is a need for a structured and proactive approach to manage the
company’s risks, both locally and centrally within the organization. Well-managed risks can create opportunities and
add value to the business while risks that are not well-managed can cause incidents and losses.
Atlas Copco’s global and diversied business towards many cus-
tomer segments results in a variety of risks and opportunities, geo-
graphically and operationally. Thus, the ability to identify, analyze
and manage risks is crucial for eective governance and control of
the business. The aim is to achieve Group targets with a high risk
awareness and well-managed risk taking, in line with the strategy
and within the frame of the handbook of policies and guidelines The
Way We Do Things. Atlas Copco sees the benets of an ecient risk
management both from risk reduction and business opportunity
perspectives, which can lead to good business growth.
Atlas Copco’s risk management approach follows the Group’s
decentralized structure. Local companies are responsible for their
own risk management, which is monitored and followed up regu-
larly, e.g. at local board meetings. Group functions for legal, insur-
ance, sustainability, treasury, tax, controlling and accounting, pro-
vide policies, guidelines and instructions regarding risk manage-
ment. This is regularly audited by internal and external audits. Exam-
ples of risks and how they are handled in Atlas Copco are shown in
the table in this section.
Insurance
The Group Insurance Program is provided by the inhouse insurance
company Industria Insurance Company Ltd. which retains part of the
risk exposure for the following insurance lines; property damage,
business interruption, transport, and general and product liability.
Financial lines insurance and business travel insurance are managed
by the Group’s Insurance and Risk Management department. How-
ever, Industria is not the insurer for these two lines. Insurance capac-
ity is purchased from leading insurers and reinsurers by way of using
international insurance brokers. Claims management services are
partly purchased on a global basis from leading providers. Insurance
policies are issued on a local basis to ensure compliance with local
insurance laws where required.
Loss prevention
The main purpose of Atlas Copco’s loss prevention process is to
prevent potential property losses and business interruptions. Atlas
Copco’s Loss Prevention Standard stipulates Group requirements in
regards of loss prevention for product companies and distribution
centers, including areas like: construction, safety systems, loss pre-
vention procedures and plans that need to be prepared. To ensure
alignment with the standard and to support sites’ understanding of
how the standard applies to each site, around 25 risk surveys are per-
formed annually. The results from the risk surveys are consolidated
and reported to Group Management.
Enterprise risk management
Atlas Copco has developed an enterprise risk management process
to map strategic risks. The methodology used is applied on divisions,
which is the highest operational level in the Group. Annual work-
shops are held by each divisional management team where risks are
identied, analyzed, evaluated/re-evaluated and managed to
ensure a structured and proactive approach to risks exposing Atlas
Copco. The ownership of managing the risks raised in this process
lies within each division, while the Insurance and Risk Management
department manages the overall process, moderates the sessions
and consolidates the results on business area and Group levels. This
hands-on approach is also in line with Atlas Copco’s decentralized
structure.
ATLAS COPCO
Enterprise Risk
Management
process
Monitor and
re-evaluate
Risk
identication
Risk
management
Risk
evaluation
Risk
analysis
Risk process
In Atlas Copco, Enterprise Risk Management is not seen as a project
but as a continuous process. The risk environment changes over time
and it is therefore necessary to continuously revisit, update and identify
new risks. The dened framework is described in the picture above.
Atlas Copco 2022 44
THE YEAR IN REVIEW – RISKS, RISK MANAGEMENT AND OPPORTUNITIES
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
• Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
RISK CONTEXT MITIGATING ACTIVITIES OPPORTUNITIES
LEGAL Atlas Copco’s business operations are aected by numerous
laws, regulations and trade sanctions as well as commercial
and nancial agreements with customers, suppliers and other
counterparties, and also by licenses, patents and other intangible
property rights.
• Inhouse lawyers on ve continents support Group companies with advice on laws and
regulations, including compliance, as well as support with contract reviews. Proactive
training is also done.
• A yearly legal risk survey of all companies in the Group is performed in addition to conti-
nuous follow-up of the legal risk exposure. The result of the survey is compiled, analyzed
and reported to the Board and the auditors.
• A separate central function, Group Compliance, is in place. It is responsible for aligning
and coordinating the compliance organization which, in line with Atlas Copco’s decen-
tralized structure, is hosted in the business areas and divisions.
Complying with legal norms and laws minimizes costs and
increases opportunities to strengthen Atlas Copco’s reputation.
It also develops reliable partnerships and improves business
stability.
The ability to trade on all markets, in compliance with applicable
trade sanctions, increases revenue and lowers risk.
FINANCIAL Changes in exchange rates can adversely aect Group earnings
when revenues from sales and costs for production and sourcing
are denominated in dierent currencies (transaction risks). An
adverse eect on Group earnings can also occur when earnings of
foreign subsidiaries are translated into SEK and on the value of
the Group equity when the net assets of foreign subsidiaries are
translated into SEK (translation risks).
Atlas Copco’s net interest cost is aected by changes in market
interest rates.
Funding risk refers to the risk that the Group and its subsidiaries
do not have access to nancing on acceptable terms.
As in any business, there can be a credit risk linked to our
customers’ abilities to pay.
• A Financial Risk Management Committee meets regularly to manage nancial risks.
• Atlas Copco Financial Solutions is responsible for these risks and supports Group
companies to implement nancial policies and guidelines.
• The Group’s operations continuously monitor relevant exchange rates and try to oset
negative changes by adjusting sales prices and costs.
• Translation risks are partially hedged by borrowings in foreign currency and nancial
derivatives.
• The Group’s Financial Risk Policy stipulates that a minimum amount of standby credit
facilities should exist and that a minimum average time to maturity for the external
debt is set.
• Stringent credit policies are applied and there is no major concentration of credit risk.
The provision for bad debt is based on historical loss levels and up-to-date information
and is deemed sucient.
Working proactively with nancial risks improves the prot
margin and creates possibilities for more stable cash ow.
Overall, nancial risk mitigation has the ability to improve
business resilience for AtlasCopco.
REPORTING
(INCLUDING TAX)
The risk related to the communication of nancial information to
the capital market is that the reports do not give a fair view of the
Group’s true nancial position and results of operations.
Reporting errors could result in management drawing the wrong
conclusions. However, with many small entities, the material
impact is low.
Taxes is an area with increased focus, especially transfer pricing
risks but also new tax rules and regulations.
Estimations sometimes form a portion of the sustainability data
which is reported, and thus by its nature the numbers presented
may not be representative of the Group’s impact.
• Atlas Copco subsidiaries report their nancial statements regularly in accordance with
International Financial Reporting Standards (IFRS). The Group’s consolidated nancial
statements, based on those reports, are prepared in accordance with IFRS and applica-
ble parts of the Annual Accounts Act as stated in RFR 1 “Supplementary Rules for
Groups”.
• The Group’s operational and legal consolidated results are based on the same num-
bers and system. These are analyzed by divisional, business area, Group Management
and corporate functions before being published externally.
• The Group has procedures in place to ensure compliance with Group instructions,
standards, laws and regulations, for example internal and external audits.
• Group Tax monitors and ensures compliance with local tax rules. Transfer pricing poli-
cies and agreements are implemented in operations and regularly updated. Quarterly
updates on tax are presented to the Board and Group Management.
• Atlas Copco reports sustainability information according to GRI Standards and works
with training to improve reporting practices.
Integrated reporting provides a better understanding of business
risks and opportunities which in turn allows for improved decision
making. It also allows the company to identify opportunities for
business synergies.
Addressing reporting risks increases trans parency and improves
the potential to represent the business fairly and accurately.
Improved reporting results in improved business insights and risk
management, especially when the data has been integrated to
highlight interdependencies.
Ecient and consistent reporting based on clear standards and
principles creates transparency, supports decision making and
drawing the right conclusions.
Increased reporting requirements on taxes improves transparency.
CORRUPTION
AND FRAUD
Corruption and bribery exist in many markets where Atlas Copco
conducts business.
Fraud or criminal deception intended to result in nancial or
personal gain, is always present in global operations.
• Zero-tolerance policy on bribery and corruption, including facilitation payments.
• Internal control routines aimed at preventing and detecting deviations. The Internal
Audit function is established to ensure compliance with the Group’s corporate gover-
nance, internal control and risk management policies.
• Control self-assessment tool to analyze internal control processes.
• Training in the Code of Conduct and signing compliance to the Code for all employees
and signicant business partners.
• The global Group misconduct reporting system to report violations anonymously.
• The Group supports fair competition and forbids discussions or agreements with
competitors concerning pricing or market sharing.
By ghting against corruption and fraud, Atlas Copco has the
opportunity to work with industry peers to inuence international
market practices. Refusing to pay bribes may cause temporary
delays and setbacks; however it reduces costs in both the long and
short run, builds opportunities to improve operational eciencies
and creates more stability in society and in markets where the
Group operates.
Working against corruption and fraud improves Atlas Copco’s
credibility and transparency and creates more ways to improve
stakeholder relations.
Examples of risks and how they are handled by Atlas Copco
Atlas Copco 2022 45
THE YEAR IN REVIEW – RISKS, RISK MANAGEMENT AND OPPORTUNITIES
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
• Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
RISK CONTEXT MITIGATING ACTIVITIES OPPORTUNITIES
HUMAN RIGHTS Atlas Copco operates in countries/areas with high risk of human
rights violations, including child labor, forced or compulsory labor,
poor working conditions, limitations of the freedom of associa-
tion and discrimination.
Atlas Copco encounters customers who are exposed to human
rights issues.
Risks to the Group’s reputation may arise from relationships with
business suppliers who do not comply with internationally
accepted ethical, social and environmental standards.
• Guidance by interaction with well-established non-governmental organizations to
identify and mitigate risks.
• Policies and procedures corresponding to the UN Guiding Principles on Business and
Human Rights, which Atlas Copco has committed to since 2011.
• Due diligence process and integration of internal controls for human rights violations
in relevant processes.
• The Group customer sustainability assessment tool.
• Regular supplier evaluations in accordance with the UN Global Compact.
Following the UN Guiding Principles on Business and Human
Rights to respect human rights reduces risks and costs.
Strong business ethics help promote societal prosperity and a
more stable market place.
Working with human rights positively impacts both the Atlas
Copco brand and stakeholder relations.
SAFETY AND
HEALTH
Poor physical and mental health and too much stress among
employees aect the individual and can cause sick leave and
disturbances in the production.
Accidents or incidents in the workplace, due to the lack of proper
safety measures, harm employees and can negatively aect
Atlas Copco’s productivity and brand.
Atlas Copco recognizes the risk that serious diseases and pandem-
ics can interrupt business operations and harm employees.
• The Group regularly assesses and manages safety and health risks in operations.
• Training is held regularly.
• The ambition is to certify all major units in accordance with the ISO 45001 standard.
• Workplace wellness programs.
• Atlas Copco’s business partners are trained in Group policies including the approach
to health and safety.
Improved safety and wellbeing among employees increases
employee satisfaction and engagement, productivity and
strengthens the brand.
Improving working conditions for customers and business partners
benets their employees and local societies and can enhance
long-lasting relationships that result in repeat orders.
CLIMATE AND
ENVIRON MENT
The primary drivers for external environmental risk are physical
changes in climate and natural resources, changes in regulations,
taxes and resource prices.
Natural disasters as a consequence of climate change can
disrupt own operations or impact the supply chain.
Increased fuel/energy taxes increase operational costs.
Regulations and requirements related to carbon-dioxide
emissions from products and industrial processes are gradually
increasing.
Climate-related and environmental events can aect all of
Atlas Copco’s operations and negatively aect operations either
directly or by disrupting the supply chain.
Market shifts toward a low-carbon economy may impact the
viability of certain sectors.
Biodiversity-related requirements on companies are increasing.
• Atlas Copco continuously develops products with improved energy eciency, reduced
emissions and lower environmental footprint.
• Atlas Copco has several key performance indicators (KPIs) that address resource and
energy usage in order to reduce carbon-dioxide emissions.
• Strict handling processes for hazardous waste and chemicals are implemented in
all operational units. Compliance is audited regularly and awareness is reinforced by
training.
• All cooling agents in Atlas Copco products have a zero-ozone depleting impact during
the product’s lifecycle, and the aim is to continue to introduce cooling agents with
lower Global Warming Potential (GWP).
• The Group’s SHEQ Policy is updated to cover biodiversity-related aspects. ISO 14001
certications in major subsidiaries will support addressing relevant environmental
focus areas.
Working proactively with environmental risks can provide signi-
cant opportunities to drive innovation at Atlas Copco.
Given that many customers are operating in areas of extreme
water stress/scarcity, water-ecient or water-recycling products
can have a strong customer appeal. This presents a strong business
opportunity to extend Atlas Copco’s innovations to the focused
area of water consumption.
Climate change impacts and predictions can induce changes in
consumers’ habits and behavior. As a result of climate events, Atlas
Copco’s customers can become more risk averse and demand sus-
tainable products from the Group. New businesses and business
models that are being served by Atlas Copco arise. For instance,
increased renewable energy generation and the surge in produc-
tion of electrical vehicles present opportunities to provide prod-
ucts to the industries.
Raised awareness of the subsidiaries’ impact on biodiversity in
their near surroundings can support activities to restore ora and
fauna.
MARKET A widespread nancial crisis and economic downturn would not
only aect the Group negatively but could also impact customers’
ability to nance their investments. Changes in customers’ pro-
duction levels also have an eect on the Group’s sales of spare
parts, service and consumables.
In developing markets, new smaller competitors continuously
appear which may aect Atlas Copco negatively.
• Well-diversied sales to customers in multiple countries and industries. Sales of
spare parts and service are relatively stable in comparison to sales of equipment.
• Monthly follow-up of market and sales development enables quick actions.
• Agile manufacturing set-up makes it possible to quickly adapt to changes in the
demand for equipment.
• Leading position in most market segments provides economies of scale.
A signicant competitive advantage as a result of a strong global
presence, including growth markets.
Opportunities to positively impact both society and environment,
through the Group’s high-quality sustainable products and high
ethical standards.
Continue to develop close, long-term and strategic relationships
with customers and suppliers.
Examples of risks and how they are handled by Atlas Copco, continued
Atlas Copco 2022 46
THE YEAR IN REVIEW – RISKS, RISK MANAGEMENT AND OPPORTUNITIES
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
• Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
RISK CONTEXT MITIGATING ACTIVITIES OPPORTUNITIES
REPUTATION The Group’s reputation is a valuable asset which may be
aected in part through the Group’s operations or actions and
in part through the actions of external stakeholders. Products
must deliver on the brand promise and be of high quality, safe
and have a low negative impact on the environment when used
by the customer. There is potential for reputational risk from
non-compliance to product labeling standards or if there are
cases of false advertising.
Unsatised employees may potentially detract the Atlas Copco
brand.
• All Atlas Copco products are tested and quality assured. Product labeling is monitored
and there are regular communications trainings.
• The Group actively engages in stakeholder dialogue.
• Compulsory training in the Code of Conduct includes the yearly signing of a
compliance statement.
• A clear and well known corporate identity and brand management.
• An employee survey is carried out every two years and followed up actively.
Brand positioning.
Stakeholder engagement not only mitigates reputational risks in
certain cases but it also presents opportunities to increase aware-
ness and credibility of Atlas Copco’s brand through improvements
and innovations.
Delivering tested and quality-assured products improves customer
satisfaction and promotes repeat business.
Attract and develop employees who adhere to the Code of
Conduct.
PRODUCTION Core component manufacturing is concentrated to a few locations
and if there are interruptions or lack of capacity in these locations,
this may have an eect on deliveries or on the quality of products.
Production facilities could also have a risk of damaging the environ-
ment through their operations, e.g. through hazardous waste and
emissions.
Atlas Copco is directly and indirectly exposed to raw material prices.
Atlas Copco primarily distributes products and services directly to
the end customer. If the distribution is not ecient, it may impact
customer satisfaction, sales and prots. Damages and losses during
the course of distribution can be costly.
Some sales are made indirectly through distributors and rental
companies and their performance may have a negative eect on
sales.
The distribution of products results in CO
2
emissions from transport.
• Manufacturing units continuously monitor the production process, test the safety
and quality of products, make risk assessments, and train employees.
• Atlas Copco has an internal Loss Prevention Standard to ensure high level of
protection.
• Production units have developed business continuity plans.
• Ambition to certify all manufacturing units in accordance with the ISO 14001
standard.
• Physical distribution of products is concentrated to a number of distribution centers
and their delivery eciency is continuously monitored.
• Resources are allocated to training and development of the service organization.
• As indirect sales are local/regional, the negative impact of poor performance is
limited.
• Increased focus on safer and more eective transports to reduce losses, costs and
total emissions per transport.
Continued opportunities to extensively promote operational
excellence to streamline production, minimize ineciencies and
maintain a high exibility in the production process.
Continue to strengthen the relationship with customers through
timely deliveries of products and services.
Transport eciencies and safe transports can save the customers
time and cost while reducing the environ mental impact of their
own operations.
Reduce fuel costs and resource requirements which improves
business agility for the Group.
SUPPLY CHAIN Atlas Copco and its business partners, such as suppliers, subcon-
tractors and joint venture partners, must share the same values as
expressed in the Group’s Code of Conduct regarding issues such
as human rights standards and principles of ethical conduct.
The availability of many components is dependent on suppliers
and if they have interruptions or lack capacity, this may aect
deliveries.
Using a large number of suppliers gives rise to the risk that prod-
ucts contain components which are not sustainably produced,
e.g. hazardous substances or electronic components containing
conict minerals, or components with a large carbon footprint.
• Business partners are selected and evaluated based on objective factors including
quality, delivery, price, and reliability, as well as on social/environmental responsibility.
• Signicant direct suppliers are required to have an approved environmental manage-
ment system.
• The presence of conict minerals in Atlas Copco’s value chain is investigated and eradicated.
• Establishment of a global network of sub-suppliers, to prevent supplier dependency.
• E-learning for business partners (suppliers and distributors) to raise awareness of the
Code of Conduct, including the requirement for signicant business partner to sign and
follow the Code of Conduct. Action plans developed together with suppliers to deal
with shortcomings and deviations.
• Atlas Copco maintains lists of substances that are prohibited or restricted due to their
potential negative impact on health or the environment. Compliance with these lists is
part of the business partner criteria.
Further increase business agility and reduce costs by improving
supplier inventory management in response to changes in
demand.
Continue to be a preferred business partner and promote e-
ciency, sustainability and safety. Good supplier relations help to
improve Atlas Copco’s competitive position.
Strengthen customer relationships by supporting customers
impacted by the Dodd Frank legislation on conict minerals.
Promote human rights and work towards improving labor
conditions, reducing corruption and conicts.
EMPLOYEE Atlas Copco must have access to and attract skilled and motivated
employees and safeguard the availability of competent managers
to achieve established strategic and operational objectives.
• The competence mapping and plan secure access to people with the right expertise at
the right time. Recruitment can be both external and internal. Internal recruitment and
job rotation are facilitated by the Internal job market.
• Salaries and other conditions are adapted to the market and linked to business priorities.
Atlas Copco strives to maintain good relationships with unions.
Motivated and skilled employees and managers are crucial to
achieve or exceed business goals and objectives.
Examples of risks and how they are handled by Atlas Copco, continued
Atlas Copco 2022 47
THE YEAR IN REVIEW – RISKS, RISK MANAGEMENT AND OPPORTUNITIES
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
• Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
RISK CONTEXT MITIGATING ACTIVITIES OPPORTUNITIES
INFORMATION
TECHNOLOGY (IT)
Atlas Copco relies on IT systems in its day-to-day operations.
Disruptions or faults in critical systems have a direct impact on
production.
Errors in the handling of nancial systems can aect the
company’s reporting of results.
Theft or modication of intellectual property constitutes a risk
to our products and future business success.
Cyber security risks are increasing in importance and can have a
major impact on Atlas Copco operations.
The General Data Protection Regulation (GDPR) impacts the han-
dling of personal data. Failure to comply may result in substantial
nes and reputational damage.
• Atlas Copco has a global IT Security policy, including quality-assurance procedures
that govern IT operations. Information security is monitored through IT Security audits
and cyber-risk assessments. Standardized processes are in place for the implementa-
tion of new systems, changes to existing systems and daily operations. The system
landscape is based on well-proven technologies.
• IT Security tracks globally major downloads of les. Screening of business partners/
consultants working in our systems.
• Cyber security is regularly discussed, addressed and invested in by the IT Security
function. By performing cyber-risk assessments, awareness of cyber security risks
increases the readiness to quickly detect and respond to any attacks.
• A privacy- and data compliance council tracks the essential activities to ensure
compliance with the regulation.
• Increased focus on secure development process for our product software.
Stable IT systems, secure IT environment and standardized pro-
cesses increase eciencies and reduce costs.
Quick action on major download of product development les
minimizes the potential damage.
Quick action to address a cyber-attack gives opportunity to stable
work environment and business continuity.
As the approach has been global, Atlas Copco is well prepared to
face future data privacy initiatives in all regions or continents.
ACQUISITIONS AND
DIVESTMENTS
When making acquisitions, there are risks related to the selection
and valuation of the potential targets as well as the process of
acquiring them. Integrating acquired businesses may also be a
complex and demanding process. There is no guarantee for an
acquisition to be successful even if all steps are done properly.
Annual impairment tests are made on acquired goodwill. If the
carrying values are not deemed justied in such tests, it can result
in a write-down, aecting the Group’s result.
Acquisitions and divestments can impact local communities and/
or the environment, directly or indirectly.
• The Group’s Acquisitions Process Council has established a process for acquisitions.
The process is continually updated and improved to address and mitigate risks. The
Council also provides training and supports business units prior to, during and after
an acquisition. Before any acquisition is completed, a detailed due diligence will be
performed in order to evaluate the risks involved.
• Atlas Copco guidelines and policies are applied to assess and manage the environmen-
tal and social impact of operations in the aected communities after an acquisition is
completed.
Acquisitions bring possibilities to enter new markets, segments,
new technologies, new clients, increase revenues, etc.
Identifying the obstacles to integration can allow Atlas Copco to
improve the process through methods such as job rotation, train-
ing or teambuilding exercises. This would not only result in a
smoother process but also lower operational costs by decreasing
downtime and allowing newly acquired companies to become
even more productive and ecient.
PRODUCT
DEVELOPMENT
One of the challenges for Atlas Copco’s long-term growth and
protability is to continuously develop innovative, sustainable
products that consume less resources over the entire life cycle.
Atlas Copco’s product oering is also aected by national and
regional legislation on issues such as emissions, noise, vibrations,
recycling, etc. However, there may be increased risk of competi-
tion in emerging markets where low-cost products are not
aected to the same extent by such rules.
• Continuous investments in research and development to develop products in line with
customer demand and expectations, even during economic downturns.
• Designing products with a life-cycle perspective and measurable eciency targets for
the main product categories in each division.
• Designing products with reduced emissions, vibrations or noise, and increased
recycling potential to meet legal requirements.
Substantial opportunities to strengthen the competitive edge by
innovating high-quality, sustainable products and creating an
integrated value proposition for customers.
Examples of risks and how they are handled by Atlas Copco, continued
Atlas Copco 2022 48
THE YEAR IN REVIEW – RISKS, RISK MANAGEMENT AND OPPORTUNITIES
Share price development and returns
In 2022, the price of the A share decreased 21.3% to SEK 123.1
(156.5
1)
) and the B share decreased 16.5% to SEK 111.1 (133.1
1)
). The
annual total return on the Atlas Copco A share, equal to dividend,
redemption and the change in the share price, including the distri-
bution of Epiroc AB, was on average 17% for the past ten years and
17% for the past ve years. The corresponding total return for
Nasdaq Stockholm was 13% and 11%, respectively.
Trading and market capitalization
The Atlas Copco shares are listed on Nasdaq Stockholm, which rep-
resented 23.0% of the total trading of the A share (37.3% of the
Bshare) in 2022. Other markets, so called Multilateral Trading Facil-
ities (MTF), e.g. CBOE accounted for 40.3% (36.9% of the Bshare),
and the remaining 36.7% (25.8% of the Bshare) were traded outside
public markets, for example through over-the-counter trading.
The market capitalization at year end 2022 was MSEK 586731
(732967) and the company represented 6.3% (5.9) of the total
market value of Nasdaq Stockholm. Atlas Copco was the second
(fth) most traded share in 2022 by total turnover.
The Atlas Copco share
A program for American Depositary Receipts (ADRs) was established
in the United States in 1990. One ADR corresponds to one share.
The depositary bank is Citibank N.A. At year end 2022, there were
109162008 ADRs outstanding, of which 101646798 represented
Ashares and 7515210 represented B shares.
Share split and mandatory redemption of shares
During the second quarter 2022 the share split resolved by the
Annual General Meeting on April 26, 2022 whereby each share was
divided into four (4) ordinary shares and one (1) redemption share,
was concluded. For further information, see atlascopcogroup.com/
en/investor-relations/atlas-copco-share/redemption-of-shares
Personnel stock option program and repurchase of own shares
The Board of Directors will propose to the Annual General Meet-
ing 2023 a similar performance-based long-term incentive program
as in previous years. The intention is to cover the plan through the
repurchase of the company’s own shares. The company’s holding of
own shares on December 31, 2022 appears in the table to the right.
SHARE INFORMATION 2022-12-31 A share B share
Nasdaq Stockholm ATCO A ATCO B
ISIN code SE0017486889 SE0017486897
ADR ATLKY.OTC ATLCY.OTC
Total number of shares 3 357 576 384 1 560 876 032
% of votes 95.6 4.4
% of capital 68.3 31.7
Whereof shares held by Atlas Copco 50 095 451 0
% of votes 1.4 0.0
% of capital 1.0 0.0
Ordinary dividend per share, SEK
Earnings per share, SEK
* Proposed by the Board of Directors
SEK
0
5
10
15
20
25
20212020*201920182017201620152014201320122011
12.00
15.00
Dividend and redemption per share, SEK
Extraordinary items, SEK
SEK
0
1
2
3
4
5
2022
2)
202120202019201820172016201520142013
3.00
3.75
3.90
EARNINGS AND DISTRIBUTION PER SHARE
1)
Dividend and redemption
per share, SEK
Extraordinary items, SEK
Earnings per share, SEK
Ordinary dividend
per share, SEK
Distribution of Epiroc AB
on June 18, 2018
2)
Proposed by the Board of Directors.
Distribution of Epiroc AB
on June 18, 2018
0
50
100
150
200
250
300
350
400
450
20192018201720162015
SEK
Highest–lowest share
price, A share
General index
(OMXS)
Industrials index
(OMXSI)
0
100000
200000
300000
400000
500000
600000
700000
800000
900000
1000000
1100000
1200000
1300000
1400000
1500000
1600000
1700000
1800000
1900000
2000000
Total average daily volume
traded A shares, thousands
0
2 500
5 000
7 500
10 000
0
20
40
60
80
100
120
140
160
180
200
20222021202020192018
0
20
40
60
80
100
120
140
160
180
200
SEK
Distribution of Epiroc AB
on June 18, 2018
Highest–lowest share
price, A share
General index
(OMXS)
Industrials index
(OMXSI)
Total average daily volume
traded A shares, thousands
Distribution of Epiroc AB
on June 18, 2018
0
10 000
20 000
30 000
SHARE PRICE DEVELOPMENT
1)
Dividend
The Board of Directors proposes to the Annual General Meeting
2023 an ordinary dividend of SEK 2.30 (1.9
1)
) per share to be paid for
the 2022 scal year. In order to facilitate a more ecient cash man-
agement, the dividend is proposed to be paid in two installments.
If approved, the ordinary dividend has averaged 51% of basic earn-
ings per share during the last ve years. The ambition is to distribute
about 50% of earnings as dividends to shareholders. See more infor-
mation on page 19.
1)
Adjusted for share split in 2022.
Atlas Copco 2022 49
THE YEAR IN REVIEW – THE ATLAS COPCO SHARE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
• The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Ownership structure
At the end of 2022, Atlas Copco had 115459 (87923) shareholders.
The ten largest shareholders registered directly or as a group with
Euroclear Sweden, the Swedish Central Securities Depository, by
voting rights, accounted for 35% (34) of the voting rights and 32%
(31) of the capital. Swedish investors held 50% (47) of the capital and
represented 47% (44) of the voting rights.
TEN LARGEST SHAREHOLDERS *
December 31, 2022 % of votes % of capital
Investor AB 22.3 17.0
Swedbank Robur fonder 3.5 4.3
Alecta Pensionsförsäkring 2.3 4.1
Handelsbanken fonder 2.0 1.9
SEB Investment Management 1.4 1.2
Nordea Investment Funds 1.0 0.9
SPP Fonder AB 0.8 0.8
Folksam 0.8 0.9
Avanza Fonder 0.7 0.7
Länsförsäkringar fondförvaltning AB 0.6 0.6
Others 64.6 67.6
Total 100.0 100.0
– of which shares held by Atlas Copco 1.4 1.0
* Shareholders registered directly or as a group with Euroclear Sweden, the
Swedish Central Securities Depository.
OWNERSHIP STRUCTURE
Number of shares, December 31, 2022 % of shareholders % of capital
1–500 57.5 0.2
501–2 000 21.6 0.6
2 001–10 000 15.5 1.7
10 001–50 000 4.2 2.0
50 001–100 000 0.5 0.7
>100 000 0.7 94.8
Total 100.0 100.0
SHAREHOLDERS BY COUNTRY
December 31, 2022, percent of capital
Other, 14% Sweden, 47%
The United
Kingdom, 8%
The United
States, 32%
Other, 13% Sweden, 50%
The United Kingdom, 7%
The United States, 30%
SHARE ISSUES
1)
Change of share capital, MSEK Amount distributed, MSEK
2011 Split 2:1
Share redemption
2)
1 229 613 104 shares at SEK 5 –393.0 –6 067.0
Bonus issue No new shares issued 393.0
2015 Split 2:1
Share redemption
3)
1 229 613 104 shares at SEK 6 –393.0 –7 304.7
Bonus issue No new shares issued 393.0
2018 Split 2:1
Share redemption
4)
1 229 613 104 shares at SEK 8 –393.0 –9 704.6
Bonus issue No new shares issued 393.0
2022 Split 4 ordinary shares and 1 redemption share
Share redemption
5)
1 229 613 104 shares at SEK 8 –157.0 –9 731.8
Bonus issue No new shares issued 157.0
IMPORTANT DATES
2023 April 27 First quarter results
April 27 Annual General Meeting
April 27 * Shares trade excluding right to dividend of SEK 1.15
May 5 * Dividend payment date (preliminary)
July 19 Second quarter results
October 25 Third quarter results
October 18 * Shares trade excluding right to dividend of SEK 1.15
October 25 * Dividend payment date (preliminary)
2024 January 25 Fourth quarter results 2023
* Board of Directors proposal to the Annual General Meeting. The record date is the rst
trading day after shares trade excluding the right to dividend.
More information
– More data per share can be found on page 147
in the four-year summary.
– For more information on distribution of shares,
option programs and repurchase of own shares,
see notes 5, 20 and 23.
– Detailed information on the share and
debt can be found on
www.atlascopcogroup.com/investor-relations
OWNERSHIP CATEGORY
December 31, 2022 % of capital
Shareholders domiciled abroad (legal entities and individuals) 50.5
Swedish nancial companies 38.6
Swedish individuals 4.7
Other Swedish legal entities 2.2
Swedish social insurance funds 2.7
Swedish trade organizations 1.0
Swedish government and municipals 0.3
Total 100.0
The Atlas Copco share, continued
1)
For more information please visit www.atlascopcogroup.com/investor-relations.
2)
1213493751 shares net of shares held by Atlas Copco.
3)
1217444513 shares net of shares held by Atlas Copco.
4)
1213080695 shares net of shares held by Atlas Copco.
5)
4 865 921 644 shares net of shares held by Atlas Copco as of May 13, 2022.
Atlas Copco 2022 50
THE YEAR IN REVIEW – THE ATLAS COPCO SHARE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
• The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
Internal control over nancial
reporting
Financials
Other information
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
• Corporate Governance
Board of Directors
Group Management
Internal control over
nancial reporting
Financials
Other information
Atlas Copco AB is incorporated under the laws of Sweden with a
Copco is governed by Swedish legislation and regulations, primarily
the Swedish Companies Act, but also the rules of Nasdaq Stockholm,
the Swedish Corporate Governance Code (the Code), the Articles of
Association and other relevant rules.
Atlas Copco does not report any deviations from the Code for
the nancial year 2022. The corporate governance report has been
examined by the auditors, see page 124.
Corporate governance
In the corporate governance report, Atlas Copco presents how applicable rules are implemented in ecient control
systems to achieve long-term growth. Good corporate governance is not only about following applicable rules, it is
also about doing what is right. The objective is to nd the right balance between risk and control in a decentralized
management model. The goal is sustainability in pro ductivity and protability, as well as in governance.
Atlas Copco is a truly global industrial company, which creates
lasting value and empowers customers to drive society for-
ward in over 180 countries. Through energy-ecient products
that save carbon emissions, and by implementing values and
processes with respect for people and the planet, Atlas Copco
can contribute to a better tomorrow. As a leading industrial
innovator and global supplier, Atlas Copco can play a role in
combating climate change. The commitment to reduce green-
house gas emissions in line with the goals of the Paris Agree-
ment, and by setting Science-based targets, the Group shows
its ambition to be part of the transformation to a low-carbon
society.
The Atlas Copco Code of Conduct is the most important
instrument to make sure the company always acts with the
highest ethical standards and integrity. The main international
ethical standards supported by Atlas Copco are the Interna-
tional Bill of Human Rights, the International Labour Organiza-
tion’s Declaration on Fundamental Principles and Rights at
Work, the OECD Guidelines for Multinational Companies and
the UN Global Compact. Atlas Copco is a member of the UN
Global Compact since 2008.
Meetings of the Board and the
Nomination Committee during 2022
Preliminary full-year 2021
results, the annual audit and
review of Power Technique
Meeting per
capsulam
Half-year report meeting
BOARD OF DIRECTORS’
MEETINGS AND ACTIVITIES
NOMINATION
COMMITTEE MEETINGS
First-quarter results
meeting and review of
Vacuum Technique
Q1
Q2
Q3
Q4
JAN.
FEB.
MAR.
APR.
MAY
JUN.
JUL.
AUG.
SEP.
OCT.
NOV.
DEC.
Nomination
Committee
meeting
Nomination
Committee
meeting
Nomination
Committee
meeting
Statutory meeting
Review of management,
succession planning,
Industrial Technique and
strategy discussion
Third-quarter results meeting
and review of Compressor
Technique and Group
Treasury Report
The following information is available at
www.atlascopcogroup.com
Atlas Copco’s Articles of Association
The Code of Conduct
Corporate governance reports since 2004
(as a part of the annual report)
Information on Atlas Copco’s Annual General Meeting
The annual signing of the Code of
Conduct, together with training,
supports Atlas Copco’s employees to
identify and handle ethical dilem-
mas and strengthens the awareness
of Atlas Copco’s values and guide-
lines. Atlas Copco also requests that
signicant business partners commit
to comply with the Code of Conduct.
This is further supported by the third
party operated system, SpeakUp,
providing a channel for anonymous reporting of suspected
ethical misconduct. To safeguard the Group’s reputation,
Atlas Copco relies on solid governance and the leaders’ ability
to defend values, including of course, internal and external
control and audits.
Hans Stråberg
Chair since 2014
Comment from the Chair
Atlas Copco 2022 51
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
• Corporate Governance
Board of Directors
Group Management
Internal control over
nancial reporting
Financials
Other information
1. Shareholders
At the end of 2022, Atlas Copco had 115 459 (87 923) shareholders.
The ten largest shareholders registered directly or as a group with
Euroclear Sweden, the Swedish Central Securities Depository, by
voting rights, accounted for 35% (34) of the voting rights and 32%
(31) of the capital. Swedish investors held 50% (47) of the capital
and represented 47% (44) of the voting rights. The largest share-
holder is Investor AB, holding 17.0% of capital and 22.3% of votes.
More information on Atlas Copco’s shareholders can be found on
pages 49–50.
2. General Meeting
The General Meeting is Atlas Copco’s supreme decision-making
body in which all shareholders are entitled to take part. Anyone reg-
istered in the shareholders’ register who have given due notication
to the Company of their intention to attend, may join the meeting
and vote for their total shareholdings. Atlas Copco encourages all
shareholders to vote at the General Meeting and share holders who
cannot participate in person may be represented by proxy holders or
vote by mail. A shareholder or a proxy holder may be accompanied
by two assistants and a proxy form can be found prior to the General
Meeting at www.atlascopcogroup.com/agm.
The Annual General Meeting (AGM) 2022 was held on April 26,
2022 in Solna, Sweden. The Company also oered shareholders the
possibility to exercise their voting rights by mail voting. 59% of the
total number of votes in the Company and 60% of the shares were
represented.
Decisions at the AGM 2022 included:
• Adoption of the income statements and balance sheets of
Atlas Copco AB and the Group for 2021.
• Discharge of liability of the Company’s aairs during the
2021 nancial year for the President and CEO and the Board of
Directors.
• Adoption of the Board’s proposal for prot distribution with a
dividend of SEK 7.60 per share to be paid in two installments.
The rst installment amount will be SEK 3.80 per share and the
second installment amount will be SEK 0.95 per share (in accor-
dance with the Annual General Meeting’s resolution on share
split and redemption).
• A share split in four (4) ordinary and one (1) mandatory
redemption share. The redemption share was automatically
redeemed resulting in an extra distribution to the shareholders
of SEK 8 per share.
• Amendment of the Articles of Association.
• That the number of directors elected by the AGM for a term end-
ing at the next AGM would be eight directors and no alternates.
• Election of the Board of Directors.
• A resolution of the Board of Directors’ fee.
• Approval of the remuneration report for 2021.
• Approval of the reported scope and principals for a performance
based employee stock option plan for 2022 including mandate for
the Board to decide upon repurchase and sales of Atlas Copco
shares to hedge the plan and previous similar plans.
• Election of Ernst & Young AB as auditing company up to and
including the Annual General Meeting 2023.
Annual General Meeting 2023
The Annual General Meeting will be held on April 27, 2023.
Shareholders who wish to contact the Nomination Committee or
have a matter addressed by the Board of Directors at the AGM may
submit their proposals by ordinary mail or e-mail to:
Atlas Copco AB, Attn: Chief Legal Ocer, SE-105 23 Stockholm,
Sweden, nominations@atlascopco.com or board@atlascopco.com
Proposals have to be received by the Board of Directors and the
Nomination Committee respectively, no later than seven weeks prior
to the AGM to be included in the notice to the AGM and the agenda.
Business areas and divisions
2. General Meeting
4. Board of Directors
1. Shareholders
9. Group Management
3. Nomination Committee
6. Remuneration Committee 5. Audit Committee
8. Internal Audit and Assurance
7. Auditor
0
20
40
60
80
2022
1)
2021
2)
2020
3)
20192018
0
150
300
450
600
%
AGM, votes, %
EGM, votes, %
Number
Shareholders and proxy
holders, number
General Meeting Attendance
0
20
40
60
80
2020*2019201820172016
0
150
300
450
600
%
AGM, votes, %
EGM, votes, %
Number
Shareholders and proxy
holders, number
1)
AGM 2022, mail voting was available.
2)
AGM 2021, due to Covid-19 only mail
voting, no physical attendance.
3)
AGM 2020, due to Covid-19 mail voting
was available and recommended.
EGM 2020, due to Covid-19 only mail
voting, no physical attendance.
Corporate governance, continued
Atlas Copco 2022 52
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
• Corporate Governance
Board of Directors
Group Management
Internal control over
nancial reporting
Financials
Other information
3. Nomination Committee
The Nomination Committee aims to propose a Board with a broad
and complementary experience from a number of important indus-
tries and markets. Experience from the manufacturing industry with
international coverage is viewed as especially valuable. The commit-
tee also considers factors such as diversity, gender balance, potential
conicts of interest etc. The Nomination Committee’s diversity pol-
icy is based on section 4.1 in the Corporate Governance Code. The
eight Board members elected by the shareholders have back-
grounds from various industries. As proposed to the AGM 2022, two
of the seven non-executive members are women. One member is
born in the 1940’s, three in the 1950’s, two in the 1960’s, and one is
born in the 1970’s. The Board members are of two dierent national-
ities, from Germany and a majority of the Board members coming
from Sweden. Increasing the diversity of the Board of Directors with
regard to gender is a priority for the Nomination Committee.
Based on the ndings of the Chair of the Board, the Nomination
Committee annually evaluates the work of the Board. Further to
that, the Nomination Committee proposes the Chair to the Annual
General Meeting, prepares a proposal regarding number and names
of Board members, including Chair and a proposal for remuneration
to the Chair and other Board members not employed by the Com-
pany, as well as a proposal for remuneration for Board committee
work. Finally, the Nomination Committee proposes an audit com-
pany including remuneration for the audit.
The proposals and the Nomination Committee’s statement will
be published at the latest with the notice to the AGM 2023. In view
of the Nomination Committee’s strive to reach gender balance, for
example in case of equal competence, the candidate that will lead to
improved gender balance should be proposed.
In compliance with the Swedish Corporate Governance Code and
the procedures adopted by the AGM 2016, the representatives of the
four largest shareholders, directly registered or ownership grouped as
listed in the shareholders’ register as of August 31, 2022, together
with the Chair of the Board shall form the Nomination Committee.
The members of the Nomination Committee for the AGM 2023 were
announced on September 15, 2022, and represented approximately
30% of all votes in the Company. The members of the Nomination
Committee receive no compensation for their work in the committee.
Nomination Committee members for the AGM 2023:
Petra Hedengran, Investor AB, Chair of the Nomination Committee;
Jan Andersson, Swedbank Robur funds; Mikael Wiberg, Alecta;
Helen Fasth Gillstedt, Handelsbanken Fonder AB; and Hans Stråberg,
Atlas Copco AB, Chair of the Board.
4. Board of Directors
The Board of Directors is responsible for the overall organization,
administration and management of Atlas Copco in the best interest
of the Company and its shareholders. The Board is responsible for
following applicable rules and implementing ecient control sys-
tems in the decentralized organization. An ecient control system
oers the correct balance between risk and control. The long-term
goals are regularly evaluated by the Board based on the Group’s
nancial situation and nancial, legal, social and environmental
risks. The mission is to achieve a sustainable and protable develop-
ment of the Group.
Board of Directors’ members
At the end of 2022 the Board of Directors consisted of eight elected
members, including the President and CEO. The Board also had two
employee representatives, each with one personal deputy. Atlas
Copco fullled the 2022 requirements of Nasdaq Stockholm and the
rules of the Swedish Corporate Governance Code regarding inde-
pendency of board members.
The Board of Directors’ work
The Board continuously addresses the Group’s strategic direction,
nancial performance, and methods to maintain sustainable prot-
ability. They also continuously ensure that ecient control systems
are in place. The Board is regularly updated, informed and educated
on topics related to sustainability, such as opportunities related to
new segments and technologies, new regulations and the Group’s
non-nancial targets. The Board also follows up on the compliance
of the Code of Conduct as well as on the Group’s whistleblowing
solution, SpeakUp. Besides the general distribution of responsibili-
ties that apply, in accordance with the Swedish Companies Act and
the Code, the Board and its committees (Audit Committee, Remu-
neration Committee and others) annually review and adopt “The
Rules of Procedure” and “The Written Instructions”, the documents
that govern the Board’s work and the distribution of tasks between
the Board, the committees and the President, as well as the
Company’s reporting processes.
The Board held seven meetings in 2022. Four were physical meet-
ings, of which three were held at Atlas Copco AB in Nacka and one in
Frankfurt. Two meetings were held virtually at Atlas Copco AB in
Nacka and one per capsulam. The attendance at Board meetings is
presented on page 55–56.
The Board continuously evaluates the performance of the President
and CEO, Mats Rahmström. For the Annual Audit, the Company’s
principal auditor, Erik Sandström, Ernst & Young AB, reported his
observations to the Board. The Board also had a separate session
with the auditor where members of Group Management were not
present.
Evaluation of the Board of Directors’ work
The annual evaluation of the Board of Directors’ work, including the
Board’s committees (Audit Committee, Remuneration Committee
and others) was conducted by the Chair of the Board, Hans Stråberg.
He evaluated the Board’s working procedures, competence and
composition, including the background, experience and diversity of
Board members. His ndings were presented to the Nomination
Committee.
Remuneration to the Board of Directors
Remuneration and fees are based on the work performed by the
Board. The AGM 2022 decided to adopt the Nomination Commit-
tee’s proposal for remuneration to the Chair and other Board mem-
bers not employed by the Company, and the proposed remunera-
tion for committee work. See also note 5.
• The Chair was granted an amount of SEK 3100000.
• Each of the other Board members not employed by the Company
was granted SEK 1000000.
• An amount of SEK 350000 was granted to the Chair of the Audit
Committee and SEK 220000 to each of the other members of this
committee.
• An amount of SEK 135000 was granted to the Chair of the
Remuneration Committee and SEK 100000 to each of the other
members of this committee.
• An amount of SEK 100000 was granted to each non-executive
director who, in addition, participates in committee work decided
upon by the Board.
• The meeting further resolved that 50% of the director’s Board fee
could be received in the form of synthetic shares.
Corporate governance, continued
Atlas Copco 2022 53
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
• Corporate Governance
Board of Directors
Group Management
Internal control over
nancial reporting
Financials
Other information
5. Audit Committee
The Audit Committee is elected by the Board at the statutory Board
meeting after the Annual General Meeting and until the statutory
Board meeting the following year. The work of the Audit Committee
is directed by the Audit Committee Charter, which is reviewed and
approved annually by the Board. The Chair of the committee has the
accounting competence required by the Swedish Companies Act
and two of the members are independent from the Company and its
main shareholder. The Audit Committee’s primary task is to support
the Board of Directors in fullling its responsibilities in the areas of
audit and internal control, accounting, nancial reporting and risk
management as well as to supervise the nancial structure and oper-
ations of the Group and approve nancial guarantees and new legal
entities, delegated by the Board. The Audit Committee work further
includes reviewing internal audit procedures, monitoring the exter-
nal auditor, considering any inspection ndings, review and monitor
the independence of the external auditor, and assist the Nomination
Committee in the selection of the auditor.
During the year, the committee convened ve times. All members
were present at these meetings. All meetings of the Audit Commit-
tee have been reported to the Board of Directors and the correspon-
ding Minutes have been distributed to the Board.
The Audit Committee members during 2022 were Anna Ohlsson-
Leijon, Chair, Johan Forssell, Hans Stråberg and Staan Bohman until
the meeting in April.
6. Remuneration Committee
The Remuneration Committee is elected by the Board at the statu-
tory Board meeting after the Annual General Meeting and until the
statutory Board meeting the following year. The work of the Remu-
neration Committee is directed by the Remuneration Committee
Charter, which is reviewed and approved annually by the Board. The
Remuneration Committee’s primary task is to propose to the Board
the remuneration to the President and CEO and a long-term incen-
tive plan for key employees. The purpose of a long-term incentive
plan is to align the interests of key personnel with those of the share-
holders. The guidelines for executive remuneration in Atlas Copco
aim to establish principles for fair and consistent remuneration with
respect to compensation, benets, and termination. The base salary
is based on competence, area of responsibility, experience and per-
formance, while the variable compensation is linked to predeter-
mined and measurable criteria which can be nancial or non-
nancial. The guidelines for executive remuneration are reviewed
annually and the Annual General Meeting 2020 approved the guide-
lines for remuneration. See also note 5.
The Remuneration Committee had three meetings in 2022. All
members were present. During the year, the Remuneration Commit-
tee also supported the President and CEO in determining remunera-
tion to the other members of Group Management. All meetings of
the Remuneration Committee have been reported to the Board
and the corresponding Minutes have been distributed to the Board.
The Remuneration Committee members during 2022 were
Hans Stråberg, Chair, Peter Wallenberg Jr, and Staan Bohman.
7. Auditor
The task of the external auditor is to examine Atlas Copco’s consoli-
dated accounts and annual report, as well as to review the Board and
the CEO’s management of the Company. At the AGM 2022 the audit
rm Ernst & Young AB, Sweden, was elected external auditor up to
and including the AGM 2023 in compliance with a proposal from the
Nomination Committee. The principal auditor is Erik Sandström,
Authorized Public Accountant at Ernst & Young AB. At the AGM
2022, Erik Sandström referred to the auditor’s report for the Com-
pany and the Group in the annual report and explained the process
applied when performing the audit. He also recommended adop-
tion of the presented income statements and balance sheets, dis-
charge of liability for the President and CEO and the Board of Direc-
tors, and adoption of the proposed distribution of prots.
8. Internal Audit and Assurance
Internal Audit and Assurance aims to provide independent and
objective assurance on internal control by conducting internal
audits. It reports ve times per year to the Audit Committee.
Read more on pages 59–60.
9. Group Management
Besides the President and CEO, the Group Management consists of
four business area presidents and four senior vice presidents respon-
sible for the main Group functions; Corporate Communications,
Human Resources, Controlling and Finance, and Legal. The President
and CEO is responsible for the ongoing management of the Group
following the Board’s guidelines and instructions.
Remuneration to Group Management
The guidelines for executive remuneration in Atlas Copco are
reviewed annually by the Board of Directors and presented to the
AGM for approval at least every four years. In 2020, the AGM
decided to adopt the Board’s proposal. The remuneration shall con-
sist of base salary, variable compensation, possible long-term incen-
tives (personnel options), pension benets and other benets. The
variable compensation is limited to a maximum percentage of the
base salary and is linked to predetermined and measurable criteria
which can be nancial or non-nancial. Non-nancial criteria for
2022 has been to reduce the Group’s CO
2
emissions. No fees are paid
for board memberships in Group companies.
Based on the guidelines for executive remuneration the Board of
Directors annually proposes a Remuneration Report to the AGM for
approval. In 2022, the AGM decided to approve the Remuneration
Report for 2021.
Statement of materiality and signicant audiences
Atlas Copco is registered in Sweden and is legally governed by the Swedish
Companies Act (2005:551). This act requires that the Board of Directors
governs the Company to be protable and create value for its sharehold-
ers. However, Atlas Copco recognizes going beyond this, extending it to
integrating sustainability into its business creating long-term value for all
stakeholders, which is ultimately in the best interest of the Company, the
shareholders and society. The signicant stakeholder audience, as outlined
in Atlas Copco’s Code of Conduct, includes representatives of society, em-
ployees, customers, business partners and shareholders.
The Code of Conduct is the central guiding policy for AtlasCopco, and
is owned by the Board of Directors. Its commitment goes beyond the
requirements of legal compliance, to supporting voluntary international
ethical guidelines. These include the United Nations International Bill of
Human Rights, International Labour Organization’s Declaration on Fun-
damental Principles and Rights at Work, the ten principles of the United
Corporate governance, continued
Nations Global Compact, and OECD’s Guidelines for Multinational Enter-
prises. Atlas Copco has employed a stakeholder-driven approach in order
to identify the most material environmental, human rights, labor and ethi-
cal aspects of its business. These priorities guide how the Group develops
and drives its business strategy, as well as its roadmap to support the UN
Sustainable Development Goals.
The strategy and fundamentals for growth together with the Group
targets presen ted on page 6 aim at continuously delivering sustainable,
protable growth for the Group. This means an increased economic value
creation and, simultaneously, a positive impact on society and the envi-
ronment, thus creating shared value.
Atlas Copco monitors and voluntarily discloses the progress on these
material nancial and non-nancial aspects, through an externally assured,
integrated annual report. In addition to the Annual General Meeting, Atlas
Copco also creates engagement opportunities so that non-shareholders
can address the Group in various stakeholder dialogues.
Atlas Copco 2022 54
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
• Board of Directors
Group Management
Internal control over
nancial reporting
Financials
Other information
Name
Position, year of birth
Hans Stråberg
Chair since 2014, born 1957
Mats Rahmström
Board member, President and CEO, born 1965
Staan Bohman
Board member, born 1949
Heléne Mellquist
Board member, born 1964
Education M.Sc. in Mechanical Engineering, Chalmers
University of Technology, Gothenburg.
MBA from the Henley Management College,
United Kingdom.
B.Sc. in Economics and Business Administration,
Stockholm School of Economics and
Stanford Executive Program, United States.
Bachelor in International Business studies,
University of Gothenburg. Executive
Management, Stockholm School of Economics.
Nationality / Elected Swedish / 2013 Swedish / 2017 Swedish / 2003 Swedish / 2022
External memberships Chair of AB SKF, Roxtec AB, CTEK AB and Anocca
AB. Board member of Investor AB and Mellby
Gård AB. Member of The Royal Swedish Academy
of Engineering Sciences.
Chair of Piab AB. Board member of Wärtsilä Oyj
Abp, Finland. Member of The Royal Swedish
Academy of Engineering Sciences.
Chair of AB Electrolux, The German-Swedish
Chamber of Commerce, and The Research Institute
of Industrial Economics. Member of The Royal
Swedish Academy of Engineering Sciences.
Board member of Thule Group AB.
Principal work experience
and other information
President and CEO for AB Electrolux. Various
executive positions in the Electrolux Group based
in Sweden and the U.S. EU Co-Chair TABD,
Trans-Atlantic Business Dialogue.
President and CEO of Atlas Copco AB*. President
of the Atlas Copco Tools and Assembly Systems
General Industry division. Before he was
appointed President and CEO he was Business
Area President for Industrial Technique.
CEO of Sapa AB, Gränges AB and DeLaval AB. President of Volvo Penta*. Senior Vice President
of Volvo Trucks Europe, Senior Vice President
of Volvo Trucks International and
CEO of Trans Atlantic AB.
Attendance
Board meetings 7 of 7 6 of 7 7 of 7 4 of 7
7)
Annual General Meeting Yes Yes Yes Yes
Independence
To Atlas Copco and its management Yes No
3)
Yes Yes
To major shareholders No
4)
Yes Yes Yes
Fees and holdings
Total fees 2022, KSEK
1)
3 489 1 332 875
Holdings in
Atlas Copco AB
2)
100 000 class B shares
75 045 synthetic shares
58 348 class A shares
50 240 class B shares
1 360 141 employee stock options
40 000 class A shares
160 000 class B shares
16 046 synthetic shares 4 599 synthetic shares
Board of Directors
Board members
appointed
by the unions
Benny Larsson
Position: Board member
Year of birth: 1972
Nationality: Swedish
Elected: 2018
Board meetings: 7 of 7
Mikael Bergstedt
Position: Board member
Year of birth: 1960
Nationality: Swedish
Elected: 2004
Board meetings: 6 of 7
REFERENCES:
All educational institutions and companies are based in Sweden, unless otherwise stated.
1)
See more information on the calculation of fees in note 5.
2)
Holdings as per end 2022, including those of close relatives or legal entities and grant for 2022.
3)
President and CEO of Atlas Copco AB.
4)
Board member in a company, which is a larger owner (Investor AB).
5)
President and CEO of a company, which is a larger owner (Investor AB).
6)
Board member of an indirect owner of Atlas Copco AB.
7)
Full attendance since their election at the Annual General Meeting in April 2022.
* Current position.
Atlas Copco 2022 55
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
• Board of Directors
Group Management
Internal control over
nancial reporting
Financials
Other information
Name
Position, year of birth
Johan Forssell
Board member, born 1971
Anna Ohlsson-Leijon
Board member, born 1968
Gordon Riske
Board member, born 1957
Peter Wallenberg Jr
Board member, born 1959
Education M.Sc. in Economics and Business
Administration, Stockholm School of
Economics.
B.Sc. in Business Administration and
Economics from Linköping University.
MBA programme at GSBA, Zurich, Switzerland, in
collaboration with the State University of New
York, United States, and BBA, Oekreal School of
Business, Zurich, Switzerland.
BSBA Hotel Administration, University of
Denver, United States, and International
Bachaloria, American School, Leysin,
Switzerland.
Nationality / Elected Swedish / 2008 Swedish / 2020 American / German / 2020 Swedish / 2012
External memberships Board member of EQT AB, Investor AB, Patricia
Industries AB, Wärtsilä Oyj Abp, Finland, Epiroc AB,
Confederation of Swedish Enterprise and
Stockholm School of Economics. Member of The
Royal Swedish Academy of Engineering Sciences.
Board member of Schneider Electric. Chair of the MTU Aero Engines, AG Munich,
Germany and Sunlight Group SA, Athens, Greece.
Member of the Executive Board for the non-prot
Hertie-Stiftung GmbH, Frankfurt, Germany, and a
Non-Executive Director at Weichai Power Co.,
Ltd., Weifang, China.
Chair of Knut and Alice Wallenberg Foundation,
Wallenberg Foundations AB and FAM Förvaltning
AB (The Grand Group). Board member of Scania.
Principal work experience
and other information
President and CEO of Investor AB*. Managing
Director, Head of Core Investments and member
of the management group of Investor AB.
Head of Commercial & Consumer Journey and
Executive Vice President at AB Electrolux*. Head
of Business Area Europe and CFO of AB Electrolux.
Other senior positions within Electrolux, including
CFO of Electrolux Appliances EMEA and Head of
Electrolux’s Corporate Control & Services
department. CFO of Kimoda. Various positions
within PricewaterhouseCoopers.
CEO of KION Group AG, Germany. Chairman of the
Management Board of Linde Material Handling
GmbH, Germany, Chairman of the Management
Board of Deutz AG, Germany, Managing Director
of KUKA Roboter GmbH, Germany, and manage-
ment positions at KUKA Schweiß anlagen & Robot-
er GmbH, Germany and KUKA Welding Systems &
Robot Corporation, U.S.
President and CEO of The Grand Hotel
Holdings, General Manager, The Grand Hotel,
President Hotel Division Stockholm-Saltsjön.
Attendance
Board meetings 7 of 7 7 of 7 7 of 7 7 of 7
Annual General Meeting Yes Yes Yes Yes
Independence
To Atlas Copco and its management Yes Yes Yes Yes
To major shareholders No
5)
Yes Yes No
6)
Fees and holdings
Total fees 2022, KSEK
1)
1 196 1 324 978 1 077
Holdings in Atlas Copco AB
2)
44 000 class B shares, 23 931 synthetic shares 1 400 class B shares, 7 898 synthetic shares 12 484 synthetic shares 666 668 class A shares, 23 931 synthetic shares
Board of Directors, continued
REFERENCES:
All educational institutions and companies are based in Sweden, unless otherwise stated.
1)
See more information on the calculation of fees in note 5.
2)
Holdings as per end 2022, including those of close relatives or legal entities and grant for 2022.
3)
President and CEO of Atlas Copco AB.
4)
Board member in a company, which is a larger owner (Investor AB).
5)
President and CEO of a company, which is a larger owner (Investor AB).
6)
Board member of an indirect owner of Atlas Copco AB.
7)
Full attendance since their election at the Annual General Meeting in April 2022.
* Current position.
Board members
appointed
by the unions
Thomas Nilsson
Position: Deputy to
Benny Larsson
Year of birth: 1972
Nationality: Swedish
Elected: 2021
Board meetings: 7 of 7
Helena Hemström
Position: Deputy to
Mikael Bergstedt
Year of birth: 1969
Nationality: Swedish
Elected: 2021
Board meetings: 7 of 7
Atlas Copco 2022 56
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Besides the President and CEO, Group Management consists of four business area executives and four executives responsible
for the main Group functions; Corporate Communications, Human Resources, Controlling and Finance, and Legal.
Group Management
Mats Rahmström
Mats Rahmström has held positions in sales,
service, marketing and general management
within the Industrial Technique business area.
He has been President of the Atlas Copco Tools
and Assembly Systems General Industry
division. Before he was appointed President
and CEO he was Business Area President for
Industrial Technique.
Position: President and CEO
Year of birth: 1965
Education: MBA from the Henley
Management College, United Kingdom.
Nationality: Swedish
Employed/In current position since:
1988/2017
External memberships: Chair of Piab AB.
Board member of Wärtsilä Oyj Abp, Finland.
Member of The Royal Swedish Academy of
Engineering Sciences.
Holdings in Atlas Copco AB
1)
58 348 class A shares
50 240 class B shares
1 360 141 employee stock options
Vagner Rego
Vagner Rego joined Atlas Copco as a trainee
engineer in São Paulo State, Brazil, and was
later appointed Business Line Manager for
Compressor Technique Service. He later be-
came Vice President Marketing and Sales for
the Compressor Technique Service division in
Belgium. Before he was appointed President
of the Compressor Technique Service division,
he was General Manager for Construction
Technique’s customer center in Brazil.
Position: Senior Executive Vice President
and Business Area President Compressor
Technique
Year of birth: 1972
Education: Mechanical engineering from
Mackenzie University and an MBA from
Ibmec Business School, both in Brazil.
Nationality: Brazilian
Employed/In current position since:
1996/2017
Holdings in Atlas Copco AB
1)
17 272 class A shares
429 936 employee stock options
Geert Follens
Geert Follens has held positions in purchasing,
supply chain and general management. He has
served as General Manager of Atlas Copco
Compressor Technique’s customer center in the
United Kingdom. Before he became President
of the Vacuum Solutions division he was rst
President of the Portable Energy division and
then of the Industrial Air division.
Position: Senior Executive Vice President and
Business Area President Vacuum Technique
Year of birth: 1959
Education: M. Sc. in Electromechanical
Engineering and a post-graduate degree in
Business Economics from the University of
Leuven, Belgium.
Nationality: Belgian
Employed/In current position since:
1995/2017
External memberships: Board member
of AB SKF.
Holdings in Atlas Copco AB
1)
18 792 class A shares
310 064 employee stock options
Henrik Elmin
Henrik Elmin joined Atlas Copco as General
Manager for Atlas Copco Tools Customer
Center Nordic in the Industrial Technique
business area. He was later appointed President
of the General Industry Tools and Assembly
Systems division. Before his current position
he was President of the Industrial Technique
Service division.
Position: Senior Executive Vice President and
Business Area President Industrial Technique
Year of birth: 1970
Education: M.Sc. in Mechanical Engineering
from Lund Institute of Technology and an
MBA from INSEAD, France.
Nationality: Swedish
Employed/In current position since:
2007/2017
Holdings in Atlas Copco AB
1)
16 240 class A shares
427 192 employee stock options
1)
Holdings as per end 2022 including those held by related natural or legal persons. See note 23 for more information on the option programs and matching shares.
All educational institutions and companies are based in Sweden, unless otherwise indicated.
Andrew Walker
Andrew Walker has held several dierent
management positions in markets including
the United Kingdom, Ireland, Belgium and the
United States. Before his current position, he
was President of the Service division within
Compressor Technique.
Position: Senior Executive Vice President and
Business Area President Power Technique
Year of birth: 1961
Education: M.Sc. in Industrial Engineering
and an MBA, both from University College
Dublin, Ireland.
Nationality: Irish
Employed/In current position since:
1986/2014
Holdings in Atlas Copco AB
1)
36 400 class A shares
6 488 class B shares
479 962 employee stock options
Atlas Copco 2022 57
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
• Group Management
Internal control over
nancial reporting
Financials
Other information
Eva Klasén
Eva Klasén joined Atlas Copco in 2000 as Assis-
tant Corporate Counsel and has since then held
several positions in the legal functions in both
Sweden and China. She has been supporting
several M&A projects, setting up the legal de-
partment in China and also being the General
Counsel for EMEA, leading the team of lawyers
in the area. Before her current position she was
Vice President, Deputy Chief Legal Ocer at
Atlas Copco AB.
Position: Senior Vice President,
Chief Legal Ocer
Year of birth: 1975
Education: Master of Law from Lund University.
Nationality: Swedish
Employed/In current position since:
2000/2022
Holdings in Atlas Copco AB
1)
3 332 class A shares
92 675 employee stock options
Peter Kinnart
Peter Kinnart started his career at Atlas Copco
as business controller at Airpower in Antwerp.
He has held several management positions
within dierent areas at Atlas Copco in Belgium,
Germany, Spain and Switzerland. Prior to his
current position, he was Vice President Business
Control at Atlas Copco’s Business Area
Compressor Technique.
Position: Senior Vice President,
Chief Financial Ocer
Year of birth: 1969
Education: Master in Applied Economic Science
and a Master in Commercial Engineering from
the University of Antwerp (UFSIA), Belgium.
Nationality: Belgian
Employed/In current position since:
1993/2021
Holdings in Atlas Copco AB
1)
6 800 class A shares
234 967 employee stock options
Sara Hägg Liljedal
Sara Hägg Liljedal began her career as a
journalist working for dierent Swedish media.
Between 2007 and 2013 she worked as Press
Secretary for the Speaker of the Swedish Parlia-
ment. She has also held roles as a Press and PR
Manager for Swedish investment services com-
panies Swedbank Robur and Skandia. Before
she was appointed Senior Vice President, Chief
Communications Ocer, she was Media
Relations Manager for the Atlas Copco Group.
Position: Senior Vice President,
Chief Communications Ocer
Year of birth: 1980
Education: BA in Journalism from
Stockholm University.
Nationality: Swedish
Employed/In current position since:
2018/2022
Holdings in Atlas Copco AB
1)
1 936 class A shares
240 class B shares
18 744 employee stock options
Cecilia Sandberg
Cecilia Sandberg began her career as Human
Resources consultant for a travel agency.
From 1999 to 2007 she held dierent Human
Resources roles at Scandinavian Airlines and
AstraZeneca. Between 2007 and 2015 she was
Vice President Human Resources for Atlas Copco’s
Industrial Technique business area. Before she
started her current position she was Senior Vice
President Human Resources at Permobil.
Position: Senior Vice President, Chief Human
Resources Ocer
Year of birth: 1968
Education: B.Sc. in Human Resources and a
M.Sc. in Sociology from Stockholm University.
Nationality: Swedish
Employed/In current position since:
2017/2017
Holdings in Atlas Copco AB
1)
12 752 class A shares
600 class B shares
174 135 employee stock options
Group Management, continued
1)
Holdings as per end 2022, including those held by related natural or legal persons. See note 23 for more information on the option programs and matching shares.
All educational institutions and companies are based in Sweden, unless otherwise indicated.
Atlas Copco 2022 58
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
• Group Management
Internal control over
nancial reporting
Financials
Other information
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
• Internal control over
nancial reporting
Financials
Other information
Internal control over nancial reporting
This section includes a description of Atlas Copco’s system of internal controls over nancial reporting in accordance with
the requirements set forth in the Swedish Code of Corporate Governance and as stipulated by the Swedish Companies Act.
1
Risk assessment
The company applies dierent processes to assess and identify
the main risks relating to nancial reporting misstatements. The
risk assessments are regularly performed to identify new risks and
follow up that internal control is adequate to address the identied
risks. The key risk areas for the nancial reporting and control activi-
ties that are in place to manage the risks are presented in the table
on the next page.
The purpose of well-developed internal controls over nancial
reporting is to ensure correct and reliable nancial statements and
disclosures.
The basis for the internal control is dened by the overall control
environment. The Board of Directors is responsible for establishing
an ecient system for internal control and governs the work
through the Audit Committee and CEO. Group Management sets
the tone for the organization, inuencing the control consciousness
of employees. One key success factor for a strong control environ-
ment lies in ensuring that the organizational structure, decision
hierarchy, corporate values in terms of ethics and integrity as well as
authority to act, are clearly dened and communicated through
guiding documents such as internal policies, guidelines, manuals,
and codes.
The nancial reporting accounting policies and guidelines are
issued by Group Management to all subsidiaries, which are followed
up with newsletters and conference calls. Trainings are also held
for complex accounting areas and new accounting policies. The
policies and guide lines detail the appropriate accounting for key
risk areas such as revenues, trade receivables, including bad debt
provisions, inventory costing and obsolescence, accounting for
income taxes (current and deferred), nancial instruments and
business acquisitions.
The internal control process is based on a control framework that
creates structure for the other four components of the process – risk
assessment, control activities, information and communication as
well as monitoring. The starting point of the process is the frame-
work for internal control issued by the Committee of Sponsoring
Organizations of the Treadway Commission (COSO), www.coso.org.
ATLAS COPCO’S INTERNAL CONTROL SYSTEM
Control environment
Risk
assessment
Control activities
(see next page)
1 2
4 3
Monitoring
(see next page)
Information and
commu ni cation
(see next page)
Atlas Copco 2022 59
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Introduction
This is Atlas Copco
The year in review
Administration report
Business areas
Sustainable approach
to delivering value
Risks, risk management and
opportunities
The Atlas Copco share
Corporate Governance
Board of Directors
Group Management
• Internal control over
nancial reporting
Financials
Other information
KEY FINANCIAL REPORTING RISKS
Revenues are not recognized in the
appropriate accounting period
Trade receivables
are not appropriately valued
Inventory is not appropriately valued at
the lower of cost or net realizable value
Income taxes are not accounted for in
accordance with applicable tax
legislation
Business acquisitions and associated
goodwill as well as intangible assets are
not appropriately accounted for
2
Control activities
to manage key nancial
reporting risks
Customer contracts are signed at
appropriate level within the Group.
Trade receivables and provisions for
bad debt are appropriately reconciled
at each reporting date.
Inventory counts are performed on a
regular basis.
Tax calculations are prepared and
reviewed at each reporting date.
All business acquisitions are approved
by the Board, CEO or Divisional
President.
Revenues are disaggregated and
analyzed by type (e.g. goods, services
and rental) and by period at local, divi-
sional, business area and Group level.
Credit assessments are performed,
and credit limits are reviewed on a
regular basis.
Inventories are appropriately recon-
ciled at each reporting date.
The eective tax rate for each country
is analyzed at each reporting date by
Group Tax.
Purchase price allocations are
prepared at divisional level and
reviewed at Group level.
Revenues for goods shipped are scruti-
nized at period end against shipping
terms and the percentage of comple-
tion for services and projects are
assessed at each reporting date.
Provisions for bad debts are made
according to Group policy.
Inventory costs are reviewed and
approved by the divisions.
Compliance with transfer pricing
policies is monitored regularly.
Goodwill impairment tests are
prepared at business area level and
reviewed at Group level.
Days of sales are analyzed at local, divi-
sional, business area and Group level.
Inventory levels and the saleability of
inventory are assessed at each report-
ing date together with obsolescence.
Ongoing tax audits and disputes are
monitored by Group tax specialists.
3
Information and communication
The company has information and communication channels
designed to ensure that information is identied, captured and
communicated in a form and timeframe that enable managers
and other employees to carry out their responsibilities. Reporting
instructions and accounting guidelines are communicated to
personnel concerned through the nancial reporting accounting
policies and guidelines, which are included in the handbook of
policies and guidelines The Way We Do Things, and supported
by, for example, training programs for dierent categories of
employees. A common Group reporting system is used to report
and consolidate all nancial information.
4
Monitoring
Examples of monitoring activities for the nancial reporting
include:
• Management at divisional, business area and Group level regularly
reviews the nancial information and assess compliance to Group
policies.
• The Audit Committee and the Board of Directors regularly review
reports on nancial performance of the Group, by business area
and geography.
• The internal audit process aims to provide independent and objec-
tive assurance on internal control. Furthermore, the process aims
to serve as a tool for employee professional development and to
identify and recommend leading practices within the Group. Inter-
nal audits are annually planned or initiated by the Group internal
audit function with a risk-based approach. Internal audits are con-
ducted under leadership of Group internal audit sta with audit
team members having diverse functional competencies but
always with expertise in accounting and controlling. The results of
the internal audits undertaken are regularly reported to the Audit
Committee and to Group Management.
• A control self-assessment (CSA) is performed primarily to support
local unit managers to evaluate the status of their control routines
and to address areas for improvement. One of the areas in the CSA
is internal control, which includes internal control over nancial
reporting. Other areas include legal matters, communication and
branding, and the Code of Conduct.
• The Group has an independent whistleblowing system where
employees and other stakeholders can anonymously report on
behavior or actions that are possible violations of laws or of Group
policies, including violations of accounting and nancial reporting
guidelines and policies. The reporting system also includes per-
ceived cases of human rights violation, discrimination or corrup-
tion. The reports are treated condentially and the person report-
ing is guaranteed anonymity via an independent third-party
service provider. More information about the system can be found
on page 129.
• In the compliance process, all managers and all employees are
requested to sign a statement conrming understanding and
compliance to nancial policies, the Code of Conduct and
applicable laws and regulations.
Internal control over nancial reporting, continued
Atlas Copco 2022 60
THE YEAR IN REVIEW – CORPORATE GOVERNANCE
Financial statements and notes
MSEK unless otherwise stated
ATLAS COPCO GROUP Page
Consolidated income statement 62
Consolidated statement of comprehensive income 62
Consolidated balance sheet 63
Consolidated statement of changes in equity 64
Consolidated statement of cash flows 65
Note
1 Significant accounting principles, critical accounting estimates and judgements 66
2 Acquisitions 73
3 Assets held for sale and divestments 76
4 Segment information 77
5 Employees and personnel expenses 80
6 Remuneration to auditors 84
7 Other operating income and expenses 84
8 Financial income and expenses 84
9 Taxes 84
10 Other comprehensive income 86
11 Earnings per share 86
12 Intangible assets 87
13 Property, plant and equipment 89
14 Investments in associated companies and joint ventures 90
15 Other financial assets 90
16 Inventories 91
17 Trade receivables 91
18 Other receivables 91
19 Cash and cash equivalents 91
20 Equity 92
21 Borrowings 93
22 Leases 95
23 Employee benefits 97
24 Other liabilities 102
25 Provisions 102
26 Assets pledged and contingent liabilities 102
27 Financial exposure and principles for control of financial risks 103
28 Related parties 107
PARENT COMPANY Page
Income statement 108
Statement of comprehensive income 108
Balance sheet 108
Statement of changes in equity 109
Statement of cash flows 109
Note
A1 Significant accounting principles 110
A2 Employees and personnel expenses and remuneration to auditors 111
A3 Other operating income and expenses 111
A4 Financial income and expenses 111
A5 Appropriations 112
A6 Income tax 112
A7 Intangible assets 112
A8 Property, plant and equipment 112
A9 Deferred tax assets and liabilities 113
A10 Shares in Group companies 113
A11 Other financial assets 113
A12 Other receivables 113
A13 Cash and cash equivalents 113
A14 Equity 113
A15 Post-employment benefits 114
A16 Other provisions 115
A17 Borrowings 115
A18 Other liabilities 116
A19 Financial exposure and principles for control of financial risks 116
A20 Assets pledged and contingent liabilities 116
A21 Directly owned subsidiaries 117
A22 Related parties 118
Atlas Copco 2022 61
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash flows
Notes
Parent company
Other information
| For the year ended December 31 | |||
Amounts in MSEK | Note | 2022 | 2021 |
Revenues | 4 | ||
Cost of sales | – | – | |
Gross profit | |||
Marketing expenses | – | – | |
Administrative expenses | – | – | |
Research and development expenses | – | – | |
Other operating income | 7 | ||
Other operating expenses | 7 | – | – |
Share of profit in associated companies and joint ventures | 14 | ||
Operating profit | 4, 5, 6, 16 | ||
Financial income | 8 | ||
Financial expenses | 8 | – | – |
Net financial items | – | – | |
Profit before tax | |||
Income tax expense | 9 | – | – |
Profit for the year | |||
| Profit attributable to: | |||
– owners of the parent | |||
– non-controlling interests | |||
Basic earnings per share, SEK | 11 | ||
Diluted earnings per share, SEK | 11 | ||
1) Earnings per share are adjusted for share split. | |||
1)
1)
Consolidated statement of comprehensive incomeConsolidated income statement
| For the year ended December 31 | |||
Amounts in MSEK | Note | 2022 | 2021 |
Profit for the year | |||
| Other comprehensive income | |||
| Items that will not be reclassified to profit or loss | |||
Remeasurements of defined benefit plans | |||
Income tax relating to items that will not be reclassified | – | – | |
| Items that may be reclassified subsequently to profit or loss | |||
| Translation differences: | |||
– on foreign operations | |||
Hedge of net investments in foreign operations | – | – | |
Cash flow hedges | – | ||
Income tax relating to items that may be reclassified | |||
Other comprehensive income for the year, net of tax | 10 | ||
Total comprehensive income for the year | |||
| Total comprehensive income attributable to: | |||
– owners of the parent | |||
– non-controlling interests | |||
Atlas Copco 2022 62
FINANCIAL STATEMENTS
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash flows
Notes
Parent company
Other information
Consolidated balance sheet
Amounts in MSEK | Note | Dec. 31, 2022 | Dec. 31, 2021 |
| ASSETS | |||
| Non-current assets | |||
Intangible assets | 12 | ||
Rental equipment | 13 | ||
Other property, plant and equipment | 13 | ||
Right-of-use assets | 22 | ||
Investments in associated companies and joint ventures | 14 | ||
Other financial assets | 15 | ||
Other receivables | |||
Deferred tax assets | 9 | ||
Total non-current assets | |||
| Current assets | |||
Inventories | 16 | ||
Trade receivables | 17 | ||
Income tax receivables | |||
Other receivables | 18 | ||
Other financial assets | 15 | ||
Cash and cash equivalents | 19 | ||
Assets classified as held for sale | 3 | ||
Total current assets | |||
TOTAL ASSETS |
Amounts in MSEK | Note | Dec. 31, 2022 | Dec. 31, 2021 |
EQUITY | Page 64 | ||
Share capital | |||
Other paid-in capital | |||
Reserves | |||
Retained earnings | |||
Total equity attributable to owners of the parent | |||
Non-controlling interests | |||
TOTAL EQUITY | |||
| LIABILITIES | |||
| Non-current liabilities | |||
Borrowings | 21 | ||
Post-employment benefits | 23 | ||
Other liabilities | |||
Provisions | 25 | ||
Deferred tax liabilities | 9 | ||
Total non-current liabilities | |||
| Current liabilities | |||
Borrowings | 21 | ||
Trade payables | |||
Income tax liabilities | |||
Other liabilities | 24 | ||
Provisions | 25 | ||
Total current liabilities | |||
TOTAL EQUITY AND LIABILITIES |
Information concerning assets pledged and contingent liabilities is disclosed in note 26.
Atlas Copco 2022 63
FINANCIAL STATEMENTS
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash flows
Notes
Parent company
Other information
2022 | Equity attributable to owners of the parent | |||||||
Amounts in MSEK | Share capital | Other paid-in capital | Hedging reserve | Trans lation reserve | Retained earnings | Total | Non-controlling interests | Total equity |
Opening balance, Jan. 1 | – | |||||||
Profit for the year | ||||||||
Other comprehensive income for the year | ||||||||
Total comprehensive income for the year | ||||||||
Dividend | – | – | – | |||||
Redemption of shares | – | – | – | – | ||||
Increase of share capital through bonus issue | – | – | – | |||||
Acquisition of series A shares | – | – | – | |||||
Divestment of series A shares | ||||||||
Change of non-controlling interests | ||||||||
| Share-based payment, equity settled: | ||||||||
– expense during the year | ||||||||
– exercise option | – | – | – | |||||
Closing balance, Dec. 31 | – | |||||||
2021 | Equity attributable to owners of the parent | |||||||
Amounts in MSEK | Share capital | Other paid-in capital | Hedging reserve | Trans lation reserve | Retained earnings | Total | Non-controlling interests | Total equity |
Opening balance, Jan. 1 | ||||||||
Profit for the year | ||||||||
Other comprehensive income for the year | – | |||||||
Transfer of reserves | – | – | – | |||||
Total comprehensive income for the year | – | |||||||
Dividend | – | – | – | |||||
Acquisition of series A shares | – | – | – | |||||
Divestment of series A shares | ||||||||
Change of non-controlling interests | – | – | – | – | ||||
| Share-based payment, equity settled: | ||||||||
– expense during the year | ||||||||
– exercise option | – | – | – | |||||
Closing balance, Dec. 31 | – | |||||||
Consolidated statement of changes in equity
Atlas Copco 2022 64
FINANCIAL STATEMENTS
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash flows
Notes
Parent company
Other information
Consolidated statement of cash flows
| For the year ended December 31 | |||
Amounts in MSEK | Note | 2022 | 2021 |
| Cash flows from operating activities | |||
Operating profit | |||
| Adjustments for: | |||
Depreciation, amortization and impairment | 12, 13, 22 | ||
Capital gain/loss and other non-cash items | – | ||
Operating cash surplus | |||
Net financial items received/paid | – | ||
Taxes paid | – | – | |
Pension funding and payment of pension to employees | – | – | |
Cash flow before change in working capital | |||
| Change in: | |||
Inventories | – | – | |
Operating receivables | – | – | |
Operating liabilities | |||
Change in working capital | – | – | |
Increase in rental equipment | – | – | |
Sale of rental equipment | |||
Net cash from operating activities | |||
| For the year ended December 31 | ||||
Amounts in MSEK | Note | 2022 | 2021 | |
| Cash flows from investing activities | ||||
Investments in other property, plant and equipment | 13 | – | – | |
Sale of other property, plant and equipment | ||||
Investments in intangible assets | 12 | – | – | |
Acquisition of subsidiaries | 2 | – | – | |
Divestment of subsidiaries | 3 | – | – | |
Investment in other financial assets, net | – | |||
Net cash from investing activities | – | – | ||
| Cash flows from financing activities | ||||
Ordinary dividend | – | – | ||
Redemption of shares | – | – | ||
Acquisition of non-controlling interest | – | – | ||
Repurchase of own shares | – | – | ||
Divestment of own shares | ||||
Borrowings | ||||
Repayment of borrowings | – | – | ||
| Settlement of CSA | – | – | ||
Payment of lease liabilities | 22 | – | – | |
Net cash from financing activities | – | – | ||
Net cash flow for the year | – | |||
Cash and cash equivalents, Jan. 1 | ||||
Net cash flow for the year | – | |||
Exchange-rate difference in cash and cash equivalents | ||||
Cash and cash equivalents, Dec. 31 | 19 | |||
| 1) | Credit Support Annex, see note 27. |
1)
Atlas Copco 2022 65
FINANCIAL STATEMENTS
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash flows
Notes
Parent company
Other information
1. Signicant acc Significant accounting principles, critical accounting estimates and judgements
Atlas Copco 2022 66
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 67
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 68
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 69
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 70
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 72
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
2. Acquisitions
Atlas Copco 2022 73
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
2. Acquisitions, continued
The following summarizes the acquisitions during 2022 and 2021, continued
Acquisition date Country Business area Revenues
1)
Number of employee s
1)
2021 May 10 MidState Air Compressor U.S.A. Compressor Technique
2)
15
2021 May 3 Eco Steam and Heating Solutions Netherlands Power Technique 198 23
2021 Apr. 7 IBVC Vacuum, S.L.U. Spain Vacuum Technique
2)
10
2021 Mar. 3 Cooper Freer Ltd United Kingdom Compressor Technique
2)
18
2021 Jan. 26 DGM SRL Italy Compressor Technique
2)
21
2021 Jan. 7 Ehrler & Beck GmbH Germany Vacuum Technique
2)
15
2021 Jan. 5 Kawalek Kompressoren Germany Compressor Technique
2)
10
Compressor Technique Recognized values
2022 2021
Intangible assets 996 881 881
Property, plant and equipment
1)
180 147 147
Other assets 602 240 240
Cash and cash equivalents 148 72 72
Interest-bearing liabilities and borrowings –205 –84 –84
Other liabilities and provisions –549 –419 –419
Goodwill 814 1 075
Total consideration 1 986 1 912 1 912
Deferred consideration –65 –1 –1
Cash and cash equivalents acquired –148 –72 –72
1)
Includes right-of-use assets.
In March, the Compressor Technique business area acquired SCB S.r.l., an
Italian manufacturer that develops, produces and distributes electronic con-
densate drains for the industrial market. Atlas Copco has a long history of
working with SCB and see many possibilities for accelerated growth in this area
going forward. Intangible assets of 24 and goodwill of 32 were recorded on
the purchase. The goodwill is not deductible for tax purposes.
In September, Oxymat A/S, a Danish supplier of on-site oxygen and nitro-
gen solutions was acquired. Oxymat is a strong brand with a global presence in
on-site nitrogen and oxygen markets. Their product portfolio and knowledge
in industrial gas generation make them a good od fit for Atlas Copco.
Additionally in September, DF-Druckluft-Fachhandel GmbH, a German
company specialized in online sales of compressed air solutions, was acquired
to increase Atlas Copco’s market share in the online business as well as
strengthen service to customers in the region. Intangible assets of 136 and
goodwill of 469 were recorded for Oxymat A/S and intangible assets of 185
and goodwill of 18 for DF-Druckluft-Fachhandel GmbH. The goodwill is not
deductible for tax purposes.
In November, Aircel, LLC., a US-based provider of air treatment and air puri ifi-
cation solutions was acquired. Aircel is a reputable company in the air treat-
ment and air puric fication market and their expertise and product portfolio will
increase Atlas Copco’s market presence and further accelerate the business
development in North America. Intangible assets of 35 and goodwill of 15
were recorded on the purchase. The goodwill is deductible for tax purposes.
Finally, in December, the assets in Suzhou Since Gas System Co., Ltd, a
manufacturer of on-site gas generation equipment and Shandong Meditech
Medical Technology Co., Ltd, a manufacturer of onsite oxygen solutions for
the healthcare market, were acquired. Both companies are based in China and
will strengthen Atlas Copco’s presence in one of the world’s largest oxygen
markets. Intangible assets of 17 and goodwill of 3 were recorded for Suzhou
Since Gas System Co., Ltd and intangible assets of 72 and goodwill of 50 for
Shandong Meditech Medical Technology Co., Ltd. The goodwill is not deduct-
ible for tax purposes.
In addition, the business area acquired twelve distributors during the year.
CAS Products Ltd (CAS), Associated Compressor Engineers Ltd (ACE), Glaston
Compressor Services Ltd, Wearside Pneumatics Ltd and Precision Pneumatics
Ltd are based in the United Kingdom. In the US, the operating assets of Com-
pressed Air Products, Inc. (CAP), Mesa Equipment & Supply Company and
Northeast Compressor were acquired. Finally, Singapore-based Bireme Group,
French FITEC S.A.S., Polish Vector Sp. z o.o and Canadian Entreprises Larry Inc,
were acquired. The acquisitions are expected to increase Atlas Copco’s pres-
ence in their respective markets.
In total, intangible assets of 450 and goodwill of 67 were recorded on the
purchases. Minor adjustments were made in the year related to the acquisi-
tions in 2021.
The acquisition of Shandong Meditech Medical Technology includes a pos-
sible contingent consideration dependent on revenues in the rst year a in the first year after
the acquisition. Since the targets are not expected to be reached, fair value is
considered to be 0.
Vacuum Technique Recognized values
2022 2021
Intangible assets 848 118 118
Property, plant and equipment
1)
167 1 18
Other assets 491 32
Cash and cash equivalents 27 22
Interest-bearing liabilities and borrowings –124 –18
Other liabilities and provisions –301 –57
Goodwill 929 – –
Total consideration 2 037 115 115
Deferred consideration –204 –31
Cash and cash equivalents acquired –27 –22
1)
Includes right-of-use assets.
In January, the Vacuum Technique business area acquired HHV Pumps Pvt. Ltd,
based in India. The company designs and manufactures vacuum pumps and
systems for applications used in a wide range of industries. HHV Pumps has a
strong reputation and through this acquisition Atlas Copco will strengthen the
market presence as well as capabilities for local manufacturing. Intangible
assets of 53 and goodwill of 70 were recorded on the purchase. The goodwill is
not deductible for tax purposes.
In June, a Turkish vacuum distributor and service provider, Tekser, was
acquired to increase Atlas Copco’s presence in the local market. Additionally
in June, a US-based provider of semiconductor subfab solutions, Qolibri Inc.,
was acquired. This acquisition was made to help improve Atlas Copco’s cus-
tomers’ sustainability by extending the uptime of vacuum and abatement
solutions. Intangible assets of 34 were recorded for Tekser and intangible
assets of 78 and goodwill of 25 for Qolibri Inc. The goodwill is not deductible
for tax purposes.
In July, Les pompes à vide TECHNI-V-AC inc, a Canadian vacuum distributor
and service provider was acquired to develop additional business in the Cana-
dian market. Intangible assets of 2 were recorded on the purchase. Addition-
ally, US-based, National Vacuum Equipment Inc. and Ceres Technologies, Inc
were acquired in July and Montana Instruments Corporation in November.
1)
Annual revenues and number of employees at the time of acquisition.
2)
Former distributor of Atlas Copco products. No revenues are disclosed for
former Atlas Copco distributors.
Atlas Copco 2022 74
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
2. Acquisitions, continued
Atlas Copco 2022 75
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
2. Acquisitions, continued
Atlas Copco 2022 76
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
4. Segment information
Atlas Copco 2022 77
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
4. Segment information, continued
2021 Compressor Technique Vacuum Technique Industrial Technique Power Technique Common Group functions Eliminations Group
Revenues from external customers 49 216 29 200 19 390 13 106 – – 110 912
Inter-segment revenues 441 19 31 128 – –619 –
Total revenues 49 657 29 219 19 421 13 234 – –619 110 912
– of which equipment 57% 76% 73% 57% – – 65%
– of which service
1)
43% 24% 27% 43% – – 35%
– of which share of pro rofit in associated companies and joint ventures 0 30 6 – – – 36
Net n t financial items –149
Income tax expense –5 276
Pro ofit for the year 18 134
Non-cash expenses
Depreciation/amortization 1 434 1 283 1 315 1 101 237 –32 5 338
Impairment
15 36 71 8 –2 – 128
Other non-cash expenses –119 32 –228 34 281 – –
Segment assets 33 164 36 463 29 423 11 230 3 329 –1 241 112 368
– of which goodwill 5 580 12 047 13 124 1 362 – – 32 113
Investments in associated companies and joint ventures 1 801 128 – 1 – 931
Unallocated assets 23 384
Total assets 33 165 37 264 29 551 11 230 3 330 –1 241 136 683
Segment liabilities 19 172 7 326 5 287 3 353 2 619 –1 139 36 618
Unallocated liabilities 32 431
Total liabilities 19 172 7 326 5 287 3 353 2 619 –1 139 69 049
Capital expenditures
Property, plant and equipment 1 082 1 181 427 703 130 –26 3 497
– of which right-of-use assets 462 188 158 132 77 – 1 017
Intangible assets 191 473 527 141 57 – 1 389
Total capital expenditures 1 273 1 654 954 844 187 –26 4 886
Goodwill acquired 1 075 – 111 232 – – 1 418
1)
Including spare parts, consumables, accessories and rental.
2021 Compressor Technique Vacuum Technique Industrial Technique Power Technique Common Group functions Eliminations Group
1)
– –687
1)
1)
Refers to a change in provision for share-related long-term incentive programs.
Atlas Copco 2022 78
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
The Group is organized in separate and focused but still integrated business
areas, each operating through divisions. The business areas oer dierent s areas offer different
products and services to die fferent customer groups. They are also the basis for
management and internal reporting and are regularly reviewed by the Group’s
President and CEO, the chief operating decision maker. The chief operating
decision maker uses more than one measure of the operating segments’ pro rofit
or loss to assess performance and allocate resources. The operating pro rofit of
the business areas is the primary pro fit measure used by the chief operating
decision maker, and is reconciled to the consolidated operating pro rofit in the
tables on the previous pages. Items a ms affecting comparability are included in a
separate table since the chief operating decision maker reviews also these as
part of allocating resources to the dierent business areas t of allocating resources to the different business areas. All business areas
are managed on a worldwide basis and their role is to develop, implement and
follow up the objectives and strategies within their respective business.
See pages 20–32 for a description of the business areas.
Common group functions, i.e. functions which serve all business areas or
the Group as a whole, are not considered a segment.
The accounting principles for the segments are the same as those described
in note 1. Atlas Copco’s inter-segment pricing is determined on a commercial
basis.
Segment assets are comprised of property, plant and equipment, right-
of-use assets, intangible assets, other non-current receivables, inventories,
and current receivables.
Segment liabilities include the sum of non-interest-bearing liabilities such
as operating liabilities, other provisions, and other non-current liabilities.
Capital expenditure includes property, plant and equipment, and intangible
assets, but excludes the ee ffect of goodwill, intangible assets and property,
plant and equipment through acquisitions.
4. Segment information, continued
Geographic distribution
2022
Compressor Technique, % Vacuum Technique, % Industrial Technique, % Power Technique, %
Group, %
Orders received Revenues Orders received Revenues Orders received Revenues Orders received Revenues Orders received Revenues
North America 25 23 24 23 32 32 32 28 27 25
South America 5 6 – – 2 2 7 8 4 4
Europe 29 31 16 15 33 33 36 37 27 27
Africa/Middle East 7 7 1 1 1 2 8 9 4 5
Asia/Oceania 34 33 59 61 32 31 17 18 38 39
Compressor Technique, % Vacuum Technique, % Industrial Technique, % Power Technique, %
Group, %
2021
Orders received Revenues Orders received Revenues Orders received Revenues Orders received Revenues Orders received Revenues
North America 21 21 21 21 31 31 29 27 24 23
South America 5 5 – – 2 3 7 8 4 4
Europe 34 34 14 13 36 36 36 36 28 29
Africa/Middle East 7 6 1 1 2 1 8 8 4 4
Asia/Oceania 33 34 64 65 29 29 20 21 40 40
By geographic area/country Revenues Non-current assets
2022 2021 2022 2021
North America U.S.A. 31 294 22 317 16 323 12 481
Other countries 4 744 3 678 2 465 2 115
36 038 25 995 18 788 14 596
South America Brazil 3 665 2 449 663 435
Other countries 2 197 1 793 188 128
5 862 4 242 851 563
Europe Belgium 1 257 1 087 3 058 2 501
France 3 800 3 272 693 565
Germany 8 076 6 468 31 462 20 964
Italy 3 560 2 955 2 303 2 103
Sweden 1 898 1 558 1 657 1 235
United Kingdom 3 255 2 835 15 507 13 743
Other countries 16 709 13 646 4 214 2 343
38 555 31 821 58 894 43 454
Africa/Middle East South Africa 844 710 137 79
Other countries 5 524 4 178 440 319
6 368 4 888 577 398
Asia/Oceania Greater China 31 914 25 544 3 493 2 667
India 4 883 3 930 507 289
Japan 2 793 2 485 608 568
South Korea 6 816 6 024 2 806 1 818
Other countries 8 096 5 983 704 572
54 502 43 966 8 118 5 914
Total 141 325 110 912 87 228 64 925
Geographical information
The revenues presented are based on the location of the customers while
non-current assets are based on the geographical location of the assets. These
assets include non-current assets other than n n financial instruments, invest-
ments in associated companies and joint ventures, deferred tax assets, and
Atlas Copco 2022 79
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
4. Segment information, continued
Quarterly data, Revenues by business area
Revenues 2022 2021
1 2 3 4 1 2 3 4
Compressor Technique 13 305 14 291 16 377 17 085 11 522 12 212 12 792 13 131
– of which external 13 169 14 174 16 244 16 957 11 423 12 099 12 677 13 017
– of which internal 136 117 133 128 99 113 115 114
Vacuum Technique 8 179 9 335 10 781 10 646 6 808 7 220 7 249 7 942
– of which external 8 173 9 332 10 773 10 639 6 804 7 214 7 245 7 937
– of which internal 6 3 8 7 4 6 4 5
Industrial Technique 5 083 5 405 5 911 6 608 4 713 4 880 4 630 5 198
– of which external 5 072 5 396 5 900 6 595 4 705 4 873 4 622 5 190
– of which internal 11 9 11 13 8 7 8 8
Power Technique 3 702 4 247 5 207 5 897 3 121 3 377 3 312 3 424
– of which external 3 672 4 209 5 157 5 863 3 089 3 348 3 280 3 389
– of which internal 30 38 50 34 32 29 32 35
Common Group
functions/eliminations
–183
–167
–202
–182
–143
–155
–159
–162
Total 30 086 33 111 38 074 40 054 26 021 27 534 27 824 29 533
Quarterly data, Operating prot by busi profit by business area
2022 2021
1 2 3 4 1 2 3 4
Compressor Technique 3 170 3 266 3 963 4 026 2 730 2 916 3 087 3 141
in % of revenues 23.8% 22.9% 24.2% 23.6% 23.7% 23.9% 24.1% 23.9%
Vacuum Technique 1 859 2 123 2 484 1 941 1 695 1 789 1 748 1 834
in % of revenues 22.7% 22.7% 23.0% 18.2% 24.9% 24.8% 24.1% 23.1%
Industrial Technique 1 065 1 077 1 267 1 188 917 981 958 1 120
in % of revenues 21.0% 19.9% 21.4% 18.0% 19.5% 20.1% 20.7% 21.5%
Power Technique 664 807 983 1 071 476 539 548 558
in % of revenues 17.9% 19.0% 18.9% 18.2% 15.3% 16.0% 16.5% 16.3%
Common Group
functions/eliminations
–9
6
–319
–416
–431
–301
–341
–405
in % of revenues 22.4% 22.0% 22.0% 19.5% 20.7% 21.5% 21.6% 21.2%
Net n t financial items –78 26 70 –190 –44 –52 –55 2
in % of revenues 22.2% 22.1% 22.2% 19.0% 20.5% 21.3% 21.4% 21.2%
Atlas Copco 2022 80
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 81
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 82
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 83
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
The following is a reconciliation of the companies’ weighted average tax based
on the nominal tax for the country as compared to the actual tax charge:
2022 2021
Weighted average tax based on national rates –6 927 –5 481
in % 23.1 23.4
Tax ee ffect of:
– non-deductible expenses –278 –268
– withholding and other taxes on dividends –349 –322
– tax-exempt income 893 686
Adjustments from prior years:
– current taxes 146 216
– deferred taxes –45 –60
Change in tax rate, deferred tax 10 –151
Tax losses not recognized 20 163
Other items –40 –81
Income tax expense –6 562 –5 276
The ee ffective tax rate was 21.8% (22.5). Withholding and other taxes on divi-
dends of –349 (–322) relate to provisions on retained earnings in countries
where Atlas Copco incur withholding and other taxes on dividends. Tax-exempt
income of 893 (686) refers to income that is not subject to taxation or subject
to reduced taxation under local law in various countries. Adjustments from
prior years – current tax includes the net from tax issues, tax disputes and also
one-time positive tax e x effects in di fferent countries and amounted to 146 (216).
In 2022, e , effects of income tax rate changes have a e affected the result with 10
(–151).
Atlas Copco 2022 84
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
9. Taxes, continued
European Commission’s decision on Belgium’s tax rulings
On January 11, 2016, the European Commission announced its decision that
Belgian tax rulings granted to companies regarding “Excess Prot” shall be
considered as illegal state aid and that unpaid taxes shall be reclaimed by the
Belgian state. Atlas Copco had such tax ruling since 2010.
Following the European Commission decision, Atlas Copco has paid, in
total MEUR 313 (MSEK 2 952). During 2015, Atlas Copco made a provision of
MEUR300 (MSEK 2 802) and paid MEUR 239 (MSEK 2 250) in 2016. In the sec-
ond quarter of 2017, Atlas Copco paid the remaining amount of MEUR 68
(MSEK 655). During 2017, MEUR 13 (MSEK 125) was expensed as an interest
cost.
The Belgian government, as well as Atlas Copco, appealed the decision to
the General Court of the European Union (EGC) in Luxembourg and on Febru-
ary 14, 2019, the EGC annulled the decision taken by the European Commission
on January 11, 2016. On May 3, 2019, the European Commission appealed the
EGC’s annulment. Following a decision by the European Court of Justice in
2021, the annulment was incorrect, and the case has again been referred to
the General Court for judgement.
In September 2020, the European Commission also published individual
opening decision stating that the specic decisions granted by Belgium
between 2005 and 2014 regarding tax rulings granted to multinationals
regarding “Excess Prot” violated the EU rules for state aid. One of these
individual decisions concerns Atlas Copco.
It is likely several years before nal decisions are made.
Atlas Copco 2022 85
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
11. Earnings per share
Amounts in SEK
Basic earnings per share Diluted earnings per share
2022 2021
1)
2022 2021
1)
Earnings per share 4.82 3.72 4.81 3.71
The calculation of earnings per share presented above is based on pro rofits and number of shares as detailed below.
2022 2021
Prot f fit for the year 23 477 18 130
Average number of shares outstanding
2022 2021
1)
Basic weighted average number of shares outstanding 4 868 350 241 4 870 932 992
Diluted weighted average number of shares outstanding 4 875 927 765 4 882 082 814
1)
Earnings per share and number of shares are adjusted for share split.
Potentially dilutive instruments
As of December 31, 2022, Atlas Copco had seven outstanding employee stock
option programs. For the 2020 program, no options were issued as the EVA
target for the Group was not met. The exercise price including adjustment for
remaining vesting costs for the 2021 and 2022 programs exceeded the aver-
age share price for series A shares, SEK 117.86 per share. These programs are
therefore considered anti-dilutive and not included in the calculation of
diluted earnings per share. If the average share price, after adjustment with
the above, exceeds the strike price in the future, these options will be dilutive,
which is the case for the 2016, 2017, 2018 and 2019 programs.
Atlas Copco 2022 86
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 87
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 88
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 89
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 90
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
16. Inventories
2022 2021
Raw materials 5 260 3 052 3 052
Work in progress 5 524 3 553 3 553
Semi-nished goods finished goods 7 623 4 963 4 963
Finished goods 8 812 6 233 6 233
Closing balance, Dec. 31
27 219 17 801 17 801
Provisions for obsolescence and other write-downs of inventories recorded
as cost of sales amounted to 560 (553). Reversals of write-downs which were
recognized in earnings totaled 35 (71). Previous write-downs have been
reversed as a result of improved market conditions in certain markets.
Inventories recognized as expense amounted to 60 607 (467 07 (46 717).
19. Cash and cash equivalents
The fair value of cash and cash equivalents corresponds to their carrying value.
Cash and cash equivalents are measured at amortized cost.
2022 2021
Cash 10 016 17 863 17 863
Cash equivalents 1 238 1 127 1 127
Closing balance, Dec. 31 11 254 18 990 18 990
During the year, cash and cash equivalents had an estimated average e e effec-
tive interest rate of 0.71% (0.15). The committed, but unutilized, credit lines
were MEUR 1 640 (1 640), which equaled to MSEK 18 277 (16 788).
See note 27 for additional information.
Atlas Copco 2022 91
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
20. Equity
Atlas Copco 2022 92
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
21. Borrowings
2022 2021
Maturity
Repurchased
nominal amount
Carrying
amount
Fair
value
Carrying
amount
Fair
value
Non-current
Medium Term Note Program MEUR 500 2023 MEUR 186 3 497 3 500 5 114 5 114 5 283 5 283
Medium Term Note Program MEUR 500
2026
5 568
5 063 5 114 5 114
Medium Term Note Program MEUR 300 2029 3 324 2 656 3 050 3 050 3 019 3 019
Medium Term Note Program MEUR 500
2032
5 513
4 316 –
–
Bilateral borrowings EIB MEUR 200 2022 MEUR 100 – – 1 024 1 024 1 026 1 026
Bilateral borrowings NIB MEUR 200
2024
2 229
2 257 2 047 2 047
Bilateral borrowings EIB MEUR 200 2027 2 229 1 958 2 047 2 047 2 051 2 051
Bilateral borrowings EIB MEUR 100
2028
1 114
959 1 024
1 024
Other bank loans 283 282 167 167 167 167
Less current portion of long-term
borrowings
–3 524 –3 527 –1 045 –1 045 –1 026 –1 026
Total non-current bonds and loans 20 233 17 464 18 542 18 542 18 848 18 848
Lease liabilities 3 505 3 505 2 328 2 328 2 328 2 328
Total non-current borrowings 23 770 21 001 20 893 20 893 21 199 21 199
Current
Current portion of long-term borrowings 3 524 3 527 1 045 1 045 1 026 1 026
Short-term loans 7 725 7 735 1 915 1 915 1 915 1 915
Lease liabilities 1 314 1 314 1 021 1 021 1 021 1 021
Total current borrowings 12 563 12 576 3 981 3 981 3 962 3 962
Closing balance, Dec. 31 36 333 33 577 24 874 24 874 25 161 25 161
reported at amortized cost and not at fair value. Changes in interest rates and credit margins create the die fference
between fair value and amortized cost. See additional information about the Group’s exposure to interest rate risk
and foreign currency risk in note 27.
In February 2022, Atlas Copco issued a 10-year MEUR 500 public bond with a coupon of 0.75% and repurchased
MEUR 186 of a MEUR 500 public bond with maturity February 2023. In December 2022, MEUR 100 of a maturing loan
from the European Investment Bank (EIB) was repaid. During the year, short-term bank facilities of MEUR 750 were put
in place. MEUR 500 of these facilities were drawn at December 31.
Short term loans include supply chain na n financing contracts with remaining payment terms exceeding 180 days.
Atlas Copco’s long-term and short-term debt is rated by Standard & Poor’s and Fitch with the long-/short-term rating
A+/A- and A+/F1+, respectively.
The Group’s credit facilities are specie fied in the table below.
Credit facilities Nominal amount Maturity Utilized
Commercial papers
1) 2)
MSEK 10 000 –
Credit-line MEUR 640 2026 –
Credit-line MEUR 1 000 2025 –
Equivalent in SEK MSEK 28 277 –
1)
Interest is based on market conditions at the time when the facility is utilized. Maturity is set when the facility is utilized.
2)
The maximum amounts available under these programs total MSEK 1000 SEK 10 000 (14095). 4 095).
The Group’s short-term and long-term borrowings are distributed among the currencies detailed in the table below.
2022 2021
Currency
Local currency (millions) MSEK % Local currency (millions) MSEK %
EUR 2 877 32 062 88 2 165 2 165 22 166 22 166 89 89
SEK 620 620 2 184 184 184 184 1 1
USD 110 1 153 3 81 81 734 734 3 3
Others – 2 498 7 – 1 790 1 790 7 7
Total 36 333 100 24 874 24 874 100 100
The following table shows the maturity structure of the Group’s borrowings.
Maturity Fixed Floating
1)
Carrying amount Fair value
2023 4 024 8 539 12 563 12 577
2024 1 040 2 229 3 269 3 375
2025 697 – – 697 697
2026 6 081 – – 6 081 5 575
2027 2 618 – – 2 618 2 347
2028 1 392 – 1 392 1 236
2029 3 547 – – 3 547 2 860
2030 173 – 173 173
2031 and after 5 993 – – 5 993 4 737
Total 25 565 10 768 36 333 33 577
1)
Floating interest in the table corresponds to borrowings with x h fixings shorter or equal to six months.
Atlas Copco 2022 93
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
21. Borrowings, continued
Atlas Copco 2022 94
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Group as a lessee
Atlas Copco´s lease portfolio consists mainly of leased buildings such as o h as offices and warehouses, vehicles and production equipment. There are several lease
contracts with extension options and variable lease payments. Carrying amounts and movements of the right-of-use asset are presented in the tables below:
22. Leases
Atlas Copco 2022 95
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
22. Leases, continued
Group as a lessor
As a lessor, the Group has p has finance and operating lease contracts, see note 1 for further information.
Finance leases – lessor
Atlas Copco has equipment which is leased to customers under der finance leases. Future payments to be received fall due as follows:
2022 2021
Gross investment
Present value of
minimum lease payments Gross investment
Present value of
minimum lease payments
Less than one year 28 27 31 31 29 29
Between one and v d five years 64 60 67 67 61 61
More than an five years 4 3 9 9 6 6
Total 96 90 107 107 96 96
Unearned na d finance income – 2 – – 6 6
Unguaranteed residual value – 4 – – 5 5
Total 96 96 107 107 107 107
Operating leases – lessor
Atlas Copco has equipment which is leased to customers under operating leases. Future payments for non-cancellable operating leasing contracts fall due
as follows:
2022 2021
Less than one year 117 117
Between one and v d five years 222 235 235
More than an five years 52 47 47
Total 391 399 399
Contingent rent recognized as income amounted to 1 (1).
Atlas Copco 2022 96
FINANCIAL STATEMENTS – NOTES
23. Employee benets benefits
Atlas Copco provides post-employment dened benet pensions and t-employment defined benefit pensions and other
long-term employee benet fits in most of its major locations. The most signi ifi-
cant countries in terms of size of plans are Belgium, Germany, Sweden, the
United Kingdom and the United States. Some plans are funded in advance
with certain assets or funds held separately from the Group for future benet fit
payment obligations. Other plans are unfunded and the benet fits from those
plans are paid by the Group as they fall due.
The plans in Belgium cover early retirement, jubilee, and termination
indemnity. These plans are unfunded.
The plans in Germany cover pensions, early retirements and jubilee. The
plans are funded.
There are three den fined benet p fit pension plans in Sweden. The ITP plan is a
Sweden. Atlas Copco n co finances the bene efits through a pension foundation.
The second plan relates to a group of employees earning more than ten
income base amounts that has opted out from the ITP plan. This plan is
insured. The third de fined benet p fit pension plan relates to former senior
employees now retired. In Sweden, in addition to bene efits relating to retire-
ment pensions, Atlas Copco has obligations for family pensions for many of
the Swedish employees, which are funded through a third-party insurer,
Alecta. This plan is accounted for as a de efined contribution plan as su fficient
information for calculating the net pension obligation is not available.
In the United Kingdom, there is a re is a final salary pension plan. This plan is
funded. In 2010, the plan was converted to a de efined contribution plan for
future services.
In the United States, Atlas Copco provides a pension plan, a post-retirement
medical plan, and a number of supplemental retirement pension benet fits for
executives. The pension plan is funded while the other plans are unfunded.
The Group identi fies a number of risks in investments of pension plan assets.
The main risks are interest rate risk, market risk, counterparty risk, liquidity and
dle the risks and has a long-term investment horizon. The investment portfolio
should be diversie fied, which means that multiple asset classes, markets and
issuers should be utilized. An asset and liability management assessment
should be conducted periodically. The study should include a number of ele-
ments. The most important elements are the duration of the assets and the
timing of liabilities, the expected return of the assets, the expected develop-
ment of liabilities, the forecasted cash ash flows and the impact of a shift in interest
rates on the obligation.
The net obligations for post-employment benet for post-employment benefits and other long-term
employee benet fits have been recorded in the balance sheet as follows:
2022 2021
Financial assets (note 15) –1 423 –781
Other provisions (note 25) 93 91
Closing balance, net 1 050 2 424
The tables below show the Group’s obligations for post-employment benet fits and other long-term employee benet fits, the assumptions used to determine these
obligations and the assets relating to these obligations for employee bene fits, as well as the amounts recognized in the income statement and the balance sheet.
The net amount recognized in the balance sheet amounted to 1 1 050 (2424 050 (2 424). The weighted average duration of the obligation is 12.5 (15.8) years.
2022 Funded pension plans Unfunded pension plans Other funded plans Other unfunded plans Total
Present value of dened benet obligations of defined benefit obligations 8 017 1 428 71 151 9 667
Fair value of plan assets –8 743 – –94 – –8 837
Present value of net obligations –726 1 428 –23 151 830
Other long-term service obligations – – 45 – 45
Net amount recognized in the balance sheet –551 1 428 22 151 1 050
2021 Funded pension plans Unfunded pension plans Other funded plans Other unfunded plans Total
Present value of dened benet obligations of defined benefit obligations 10 350 1 451 76 153 12 030
Fair value of plan assets –9 586 – –85 – –9 671
Present value of net obligations 764 1 451 –9 153 2 359
Other long-term service obligations – – 40 – 40
Net amount recognized in the balance sheet 789 1 451 31 153 2 424
Plan assets consist of the following: 2022
2021Quoted market price Unquoted market price Total
Debt instruments 863 274 1 137 1 152
Equity instruments 771 387 1 158 1 033
Property 1 040 831 1 871 1 758
Assets held by insurance companies 125 1 501 1 626 1 973
Cash 396 – 396 622
Investment funds 682 574 1 256 1 518
Derivatives 675 6 681 791
Others 287 425 712 824
Closing balance, Dec. 31 4 839 3 998 8 837 9 671
Atlas Copco 2022 97
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
23. Employee benets, continued
0
2 000
4 000
6 000
8 000
10 000
12 000
20212022
MSEK
Europe
North America
Rest of the world
0
2 000
4 000
6 000
8 000
10 000
20202021
MSEK
Europe
North America
Rest of the world
The dened benet obligations for employee benets consist
of plans in the following geographic areas:
The plan assets are allocated among the
following geographic areas: 2022 2021
Europe 7 664 8 556 8 556
North America 615 682 682
Rest of the world 558 433 433
Total 8 837 9 671 9 671
Asset ceiling 2022 2021
Asset ceiling at Jan. 1 25 – –
Interests 1 –
Remeasurements – asset ceiling 135 24 24
Translation dierence ranslation differences 14 1 1
Asset ceiling, Dec. 31 175 25 25
Principal actuarial assumptions at the balance sheet
date (expressed as weighted averages in %) 2022 2021
Discount rate
Europe 3.73 1.16 1.16
North America 5.41 2.71 2.71
Future salary increases
Europe
2.53 2.27 2.27
Medical cost trend rate
North America 4.50 6.22
as the primary actuarial assumptions for determining den fined benet o fit obliga-
tions. Changes in those actuarial assumptions ae s affect the present value of the
net obligation. The discount rate is determined by reference to market yields at
the balance sheet date using, if available, high quality corporate bonds (AAA
or AA) matching the duration of the pension obligations. In countries where
corporate bonds are not available, government bonds are used to determine
the discount rate. In Sweden in line with prior years, mortgage bonds are used
for determining the discount rate.
Atlas Copco’s mortality assumptions are set by country, based on the most
recent mortality studies that are available. Where possible, generational
mortality assumptions are used, meaning that they include expected improve-
ments in life expectancy over time.
The table below shows the sensitivity analysis for discount rate and increase
in life expectancy and describes the potential e l effect on the present value of the
Sensitivity analysis Europe North America
Change in discount rate +0.5% –498 –24
Change in discount rate –0.5% 524 25
Increase in life expectancy, +1 year 239 13
Atlas Copco 2022 98
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Timeline 2022 long term incentive program
Annual General Meeting Information of grant
Group Management´s
and division presidents’ own
investments Exercise price set Issue of options Plan expires
Vesting period Options and matching options exercisable
April 2022 May 2022 June 2022 February 2023 March 2023 May 1, 2025 April 30, 2029
Atlas Copco 2022 99
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 100
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
23. Employee benets, benefits, continued
Atlas Copco 2022 101
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Atlas Copco 2022 102
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
27. Financial exposure and principles for control of nancial risks
Ordinary dividend per share, SEK
Earnings per share, SEK
* Proposed by the Board of Directors
SEK
0
5
10
15
20
25
20212020*201920182017201620152014201320122011
12.00
15.00
Dividend and redemption per share, SEK
Extraordinary items, SEK
SEK
0
1
2
3
4
5
2022
2)
202120202019201820172016201520142013
3.00
3.75
3.90
EARNINGS AND DISTRIBUTION PER SHARE
1)
Dividend and redemption per share, SEK
Extraordinary items, SEK
Earnings per share, SEK
Ordinary dividend per share, SEK
Distribution of Epiroc AB
on June 18, 2018
Distribution of Epiroc AB on June 18, 2018
1)
Adjusted for share split in 2022
2)
Proposed by the Board of Directors
Financial Solutions
Financial Risk Management Committee (FRMC)
BOARD OF DIRECTORS ATLAS COPCO AB
Policies
Decisions
Financial Solutions Asia
and Pacic
Financial Solutions Europe,
Middle East and Africa
Financial Solutions North America
and South America
Execution and monitoring
Capital management
Atlas Copco denes capital as borrowings and equity, which at December 31 totaled MSEK 116 359 (92508). The Group’s
policy is to have a capital structure to maintain investor, creditor and market condence and to support future develop-
ment of the business. The Board’s ambition is that the annual dividend shall correspond to about 50% of earnings per
share. In recent years, the Board has sometimes also proposed, and the Annual General Meeting has approved, distribu-
tions of “excess” equity to the shareholders through share redemptions and share repurchases.
There are no external capital requirements imposed on the Group.
Atlas Copco 2022 103
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
27. Financial exposure and principles for control of nancial risks, continued
Interest rate risk
Interest rate risk is the risk that the Group is negatively aected by changes
in the interest rate levels.
Policy
The Group’s policy states that the average interest duration (i.e. period for
which interest rates are xed) should be a minimum of 6 months and without
a maximum limit.
Status at year end
The Group’s borrowings have a mix of xed and oating rates. No interest rate
swaps are used to convert interest. For more information about the Group’s
borrowings, see note 21.
Interest risk 2022 2021
Eective interest rate on bonds and loans 1.2% 0.9%
Eective interest rate on lease liabilities 1.8% 2.0%
Duration (months) 46 45
27% (16) of the Group’s bonds and loans have oating interest rates. A shift of
one percentage point upward of all oating rates would impact the Group’s
interest net with MSEK –78 (–31). Same shift downwards would impact the
Group’s interest net with MSEK 78 (0).
The book value of the Group’s bonds and loans are not exposed to market
interest rate risk at year end as all bonds and loans are reported at amortized
cost, compared to if borrowings were reported at fair value where cash ows
are discounted using market interest rate.
Currency risk
The Group is present in various geographical markets and undertakes trans-
actions denominated in foreign currencies and is consequently exposed to
exchange rate uctuations. The exposure occurs in relation to payments in for-
eign currency (transaction exposure) and when translating foreign subsidiar-
ies’ balance sheets and income statements into SEK (translation exposure).
Transaction exposure risk
Transaction exposure risk is the risk that protability is negatively aected by
changes in exchange rates, aecting cash ows in foreign currencies in the
operations. Due to the Group’s global presence, there are inows and out-
ows in dierent currencies. As a normal part of business, net surpluses or de-
cits in specic currencies emerge. The values of these net positions uctuate
subject to changes in currency rates and, thus, render transaction exposure for
the Group.
Policy
The Group’s policy states that exposure shall be reduced by matching in- and
outows of the same currencies. Business area and divisional management are
responsible for maintaining readiness to adjust their operations (price and
cost) to compensate for adverse currency movements. Based on the assump-
tion that hedging does not have any signicant eect on the Group’s long-
term result, the policy recommends to leave transaction exposures unhedged
on an ongoing basis. In general, business areas and divisions shall not hedge
GRAPH 1 Estimated operational transaction exposure in the Group’s most important currencies*
–20 000
–15 000
–10 000
–5 000
0
5 000
10 000
15 000
20 000
OtherUSDSEKPLNINRIDRGBPEURCZKCNYCHFCADBRLAUD
MSEK
2022
–20 000
–15 000
–10 000
–5 000
0
5 000
10 000
15 000
20 000
OtherUSDTHBSEKRUBKRWINRGBPEURCZKCNYCADBRLAUD
MSEK
2021
–20 000
–15 000
–10 000
–5 000
0
5 000
10 000
15 000
20 000
OtherUSDSEKPLNINRIDRGBPEURCZKCNYCHFCADBRLAUD
MSEK
2022
–20 000
–15 000
–10 000
–5 000
0
5 000
10 000
15 000
20 000
OtherUSDTHBSEKRUBKRWINRGBPEURCZKCNYCADBRLAUD
MSEK
2021
* Without adjustments for onetime eects.
Outstanding derivative
instruments related to
transaction exposure
2022
Nominal amount, net in
transaction currency
2021
Nominal amount, net in
transaction currency
Foreign exchange forwards
GBP 73 269
USD –96 –368
The FRMC has decided to hedge part of the GBP/USD transaction exposure
with foreign exchange forward contracts. The net nominal amount are MGBP
73/MUSD –96 (MGBP 269/MUSD –368). All contracts mature within 3 months.
The fair value of the outstanding contracts is MSEK –82 (–55)
Translation exposure risk
Translation exposure risk is the risk that the value of the Group’s net invest-
ments in foreign currencies is negatively aected by changes in exchange
rates. The Group’s global presence creates currency eects when subsidiaries’
nancial statements with functional currencies other than SEK are translated
to SEK in the Group’s consolidated nancial statements. Translation of subsid-
iaries’ prot aects the Group’s prot and balance sheet translation aect
other comprehensive income. The translation exposure is measured as the net
of assets and liabilities in a specic currency.
Policy
The Group’s policy states that translation exposure should be reduced by
matching assets and liabilities in the same currencies. The FRMC can decide to
hedge part or all remaining translation exposure. Any hedge of translation
exposure shall qualify for hedge accounting in accordance with IFRS.
currency risks. The FRMC can decide to hedge part of the transaction exposure.
Transactions shall then qualify for hedge accounting in accordance with IFRS
and hedging beyond 18 months is not allowed. Financial transaction exposure
is substantially hedged.
Status at year end
The Group has continued to manage transaction exposures primarily by
matching in- and outows in the same currencies. Graph 1 shows the net of in-
and outows per currency for currencies which have the largest surplus or
decit. The operational transaction exposure is dened as the net operational
cash ow exposure and amounts to MSEK –5 091 (–4 678). The estimated
amounts are based on the Group’s operational external payments from cus-
tomers and to suppliers.
The transaction exposure sensitivity analysis is based on the operational
transaction exposure. It shows how the cash ow and prot before tax would
theoretically be impacted by a ve percentage point change in SEK, USD or
EUR, against all other currencies. The analysis is based on the assumption that
no hedging transaction has been undertaken and is done before any impact of
osetting price adjustments or similar measures.
As an example, the net transaction exposure of in-and outow payments in
EUR is a decit as shown in graph 1. A strengthening in the EUR currency rate
against all other currencies with +5% would have a negative impact on the
cash ow and prot before tax of MSEK –914, and a weakening would have a
positive impact of MSEK 914.
Transaction exposure sensitivity 2022 2021
SEK exchange rate + 5% –255 –234
USD exchange rate + 5% 980 682
EUR exchange rate + 5% –914 –681
Transaction exposure
Atlas Copco 2022 104
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Status at year end
Graph 2 shows the Group’s sensitivity to currency translation eects when
earnings of foreign subsidiaries are translated to SEK. A ve percentage points
upward change in SEK would impact the Group’s prot before tax with
MSEK –1 380 (–1110).
27. Financial exposure and principles for control of nancial risks, continued
–5
–4
–3
–2
–1
0
1
2
3
4
5
–1 380
–1 104
–828
–552
–276
0
276
552
828
1 104
1 380
Change in exchange rate SEK, %
Change in prot, MSEK
555
444
333
222
111
0
–111
–222
–333
–444
–555
Change in exchange rate SEK, %
Change in prot, MSEK
–5
–4
–3
–2
–1
0
1
2
3
4
5
550
440
330
220
110
0
–110
–220
–330
–440
–550
GRAPH 2
Translation eect on
prot before tax
The Group has hedged part of the translation exposure using loans and
foreign exchange forward contracts. The hedges have reduced the exposure
on net investments in EUR in the consolidated nancial statements and the
exchange rate risk related to net assets in subsidiaries. The hedges are
designated as net investment hedges in the consolidated nancial statements.
1)
In the balance sheet, loans designated as net investment hedges are reported at
amortized cost and not at fair value.
Most of the Group´s bonds and loans are designated as net investments
hedges, and movements in currency rates are accounted for in other compre-
hensive income. A ve percentage points upward change in EUR against SEK
would aect other comprehensive income with MSEK 580 (689), see also
note1, Signicant accounting principles, Financial assets and liabilities –
nancial instruments.
Atlas Copco 2022 105
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Financial credit risk
Credit risk on na n financial transactions is the risk that the Group incurs losses as a
result of non-payment by counterparts related to the Group’s investments,
bank deposits or derivative transactions.
Policy
action type; investment transactions or derivative transactions.
Derivative transactions
Derivative transactions may only be undertaken with approved counterparts
for which credit limits are established and with which ISDA (International
Swaps and Derivatives Association) master agreements and CSA (Credit
Support Annex) agreements are in force. Derivative transactions may only be
entered into by Atlas Copco Financial Solutions or in rare cases by another sub-
sidiary, but only with approval from the Group Treasurer. Atlas Copco primarily
uses derivatives as hedging instruments and the policy allows only standard-
ized (as opposed to structured) derivatives.
The table below presents the reported value of the Group’s derivatives.
Outstanding derivative instruments
2022 2021 2021
Assets 34 9 9
Liabilities 287 222 222
shows derivatives covered by master netting agreements.
Outstanding net position for derivative instruments
Gross
O ffset in
balance
sheet
Net in
balance
sheet
Master
netting
agreement
Cash
collateral
Net
position
Assets
Derivatives 34 – 34 –287 270 17
Liabilities
Derivatives 287 – 287 –287 – –
The positive net position in assets is due to the fact that the exchange of
security is done on a weekly basis.
27. Financial exposure and principles for control of nancial risks, continued
Atlas Copco 2022 106
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
27. Financial exposure and principles for control of nancial risks, continued
Reconciliation of nancial liabilities
in Level 3
Opening
balance
Business
acquisitions Settlement Discounting eect Remeasurement
Translation
dierences
Closing
balance Result related to liabilities, net
Contingent considerations 2022 125 208 –54 15 –17 22 299 2
In other liabilities, MSEK 299 (125) relate to contingent considerations for acquisitions. The fair value of these liabilities has been calculated based on the expected
outcome of the targets set out in the contracts, given a discount rate of 10.5%. For information about changes due to acquisitions, see note 2.
Currency rates used in the nancial statements Value Code
Year-end rate Average rate
2022 2021 2022 2021
Canada 1 CAD 7.72 7.07 7.73 6.82
China 1 CNY 1.50 1.42 1.50 1.33
EU 1 EUR 11.14 10.24 10.64 10.15
India 1 INR 0.13 0.12 0.13 0.12
South Korea 1 000 KRW 8.27 7.61 7.86 7.50
United Kingdom 1 GBP 12.63 12.19 12.47 11.77
U.S.A. 1 USD 10.46 9.05 10.08 8.57
Atlas Copco 2022 107
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
• Notes
Parent company
Other information
Financial statements, Parent Company
Income statement
For the year ended December 31
Amounts in MSEK Note 2022 2021
Administrative expenses A2 –733 –764
Other operating income A3 278 121
Other operating expenses A3 –9 –1
Operating loss –464 –644
Financial income A4 30 613 3 858
Financial expenses A4 –342 –394
Prot after nancial items 29 807 2 820
Appropriations A5 2 946 2 695
Prot before tax 32 753 5 515
Income tax A6 –320 –339
Prot for the year 32 433 5 176
Balance sheet
As at December 31
Amounts in MSEK Note 2022 2021
ASSETS
Non-current assets
Intangible assets A7 8 13
Tangible assets A8 33 34
Financial assets:
Deferred tax assets A9 55 63
Shares in Group companies A10, A21 179 491 163 569
Other nancial assets A11 255 223
Total non-current assets 179 842 163 902
Current assets
Income tax receivables 461 610
Other receivables A12 4 471 9 347
Cash and cash equivalents A13 0 0
Total current assets 4 932 9 957
TOTAL ASSETS 184 774 173 859
As at December 31
Amounts in MSEK Note 2022 2021
EQUITY
Restricted equity
Share capital 786 786
Legal reserve 4 999 4 999
Total restricted equity 5 785 5 785
Non-restricted equity
Reserve for fair value –1 180 –1 180
Retained earnings 125 264 139 595
Prot for the year 32 433 5 176
Total non-restricted equity 156 517 143 591
TOTAL EQUITY 162 302 149 376
PROVISIONS
Post-employment benets A15 203 205
Other provisions A16 501 813
Total provisions 704 1 018
LIABILITIES
Non-current liabilities
Borrowings A17 18 532 22 195
Total non-current liabilities 18 532 22 195
Current liabilities
Borrowings A17 2 861 926
Other liabilities A18 375 344
Total current liabilities 3 236 1 270
TOTAL EQUITY AND LIABILITIES 184 774 173 859
Statement of comprehensive income
For the year ended December 31
Amounts in MSEK Note 2022 2021
Prot for the year 32 433 5 176
Other comprehensive income
for the year
– –
Total comprehensive income
for the year
32 433 5 176
Atlas Copco 2022 108
FINANCIAL STATEMENTS
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
Statement of changes in equity
MSEK unless otherwise stated Number of shares outstanding Share capital Legal reserve Reserve for fair value – translation reserve Retained earnings Total
Opening balance, Jan. 1, 2022 1 218 190 368 786 4 999 –1 180 144 771 149 376
Total comprehensive income for the year 32 433 32 433
Ordinary dividend –9 250 –9 250
Share split 4 872 761 472 – –
Redemption of shares –1 223 320 239 –157 –9 575 –9 732
Increase of share capital through bonus issue 157 –157 –
Acquisition series A shares –1 870 000 –864 –864
Divestment series A shares 2 595 364 381 381
Share-based payment, equity settled:
– expense during the year 89 89
– exercise of options –131 –131
Closing balance, Dec. 31, 2022 4 868 356 965 786 4 999 –1 180 157 697 162 302
Opening balance, Jan. 1, 2021 1 216 192 653 786 4 999 –1 180 147 684 152 289
Total comprehensive income for the year 5 176 5 176
Ordinary dividend –8 889 –8 889
Acquisition series A shares –700 000 –416 –416
Divestment series A shares 2 697 715 1 451 1 451
Share-based payment, equity settled:
– expense during the year 212 212
– exercise of options –447 –447
Closing balance, Dec. 31, 2021 1 218 190 368 786 4 999 –1 180 144 771 149 376
See note A14 for additional information.
Statement of cash ows
For the year ended December 31, MSEK 2022 2021
Cash ows from operating activities
Operating loss –464 –644
Adjustments for:
Depreciation 12 11
Capital gain/loss and other non-cash items –686 –596
Operating cash decit –1 138 –1 229
Net nancial items received 22 834 3 639
Group contributions received 2 695 88
Taxes paid –309 –210
Cash ow before change in working capital 24 082 2 288
Change in
Operating receivables 5 276 9 573
Operating liabilities 30 60
Change in working capital 5 306 9 633
Net cash from operating activities 29 388 11 921
For the year ended December 31, MSEK 2022 2021
Cash ow from investing activities
Investments in tangible assets –6 –3
Investments in intangible assets – –5
Investments in subsidiaries –8 186 –1 833
Repayments/investments in nancial assets –3 –2
Net cash from investing activities –8 195 –1 843
Cash ow from nancing activities
Dividends paid –9 250 –8 889
Redemption of shares –9 732 –
Repurchase and divestment of own shares –483 1 034
Change in interest-bearing liabilities –1 728 –2 231
Net cash from nancing activities –21 193 –10 086
Net cash ow for the year 0 –8
Cash and cash equivalents, Jan. 1 0 8
Net cash ow for the year 0 –8
Cash and cash equivalents, Dec. 31 0 0
Atlas Copco 2022 109
FINANCIAL STATEMENTS
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
Notes to the Parent Company nancial statements
MSEK unless otherwise stated
A1. Signicant accounting principles
Atlas Copco AB is the ultimate Parent Company of the Atlas Copco Group and
is headquartered in Nacka, Sweden. Its operations include administrative
functions, holding company functions as well as parts of Atlas Copco Financial
Solutions (Treasury).
The nancial statements of Atlas Copco AB have been prepared in accordance
with the Swedish Annual Accounts Act and the recommendation RFR 2,
“Accounting for Legal Entities”, hereafter referred to as “RFR 2”, issued by the
Swedish Financial Reporting Board. In accordance with RFR 2, parent compa-
nies that issue consolidated nancial statements according to International
Financial Reporting Standards (IFRS), as endorsed by the European Union, shall
present their nancial statements in accordance with IFRS, to the extent these
accounting principles comply with the Swedish Annual Accounts Act and may
use exemptions from IFRS provided by RFR 2 due to Swedish accounting or tax
legislation.
The nancial statements are presented in Swedish krona (SEK), rounded to
the nearest million. The parent company’s accounting principles have been
consistently applied to all periods presented unless otherwise stated. The
nancial statements are prepared using the same accounting principles as
described in note 1 in the Group’s consolidated nancial statements, except
for those disclosed in the following sections.
For discussion regarding accounting estimates and judgments, see page 71.
Subsidiaries
Participations in subsidiaries are accounted for by the Parent Company at his-
torical cost. The carrying amounts of participations in subsidiaries are reviewed
for impairment in accordance with IAS 36, Impairment of Assets. See the
Group’s accounting policies, Impairment of nancial assets, for further details.
Transaction costs incurred in connection with a business combination are
accounted for by the Parent Company as part of the acquisition costs and are
not expensed.
Lease contracts
All lease contracts entered into by the Parent Company are expensed
continuously on a straight-line basis over the lease term. Leases are not carried
as assets, since the risk and rewards associated with ownership of the assets
have not been transferred to the Parent Company.
Employee benets
Dened benet plans
Dened benet plans are not accounted for in accordance with IAS 19. In
the Parent Company dened benet plans are accounted for according to the
Swedish law regarding pensions, ”Tryggandelagen” and regulations issued by
the Swedish Financial Supervisory Board. The primary dierences as compared
to IAS 19 are the way discount rates are xed, that the calculation of dened
benet obligations is based on current salary levels, without consideration of
future salary increases and that all actuarial gains and losses are included in
prot or loss as they occur.
Share-based payments
The share-based payments that the Parent Company has granted to employ-
ees in the Parent Company are accounted for using the same principle as
described in note 1 in the Group’s consolidated nancial statements.
The share-based payments that the Parent Company has granted to
employees in subsidiaries are not accounted for as an employee expense in the
Parent Company, but are recognized against Shares in Group companies. This
vesting cost is accrued over the same period as in the Group and with a corre-
sponding increase in equity for equity-settled programs and as a change in
liabilities for cash-settled programs.
Financial guarantees
Financial guarantees issued by the Parent Company for the benet of subsid-
iaries are not valued according to IFRS 9. They are reported as contingent liabil-
ities, unless it becomes probable that the guarantees will lead to payments.
In such case, provisions will be recorded.
Hedge accounting
Interest-bearing liabilities denominated in other currencies than SEK, used to
hedge currency exposure from investments in shares of foreign subsidiaries
are not translated using the foreign exchange rates on the reporting date, but
measured based on the exchange rate the day that the hedging relation was
established.
Derivatives used to hedge investments in shares in foreign subsidiaries are
recognized at fair value and changes therein are recognized in prot or loss.
The corresponding fair value change on shares in subsidiaries is recognized in
prot or loss, as fair value hedge accounting is applied.
Group and shareholders’ contributions
In Sweden, Group contributions are deductible for tax purposes but share-
holders’ contributions are not. Group contributions are recognized as appro-
priations in the income statement. Shareholders’ contributions are recognized
as an increase of Shares in Group companies and tested for impairment.
Atlas Copco 2022 110
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
Other social costs 64 79
Total 101 114
Pension obligations to former members of Group Management 4 5
Remuneration to auditors
Audit fees and consultancy fees for advice or assistance other than audit, were as follows:
2022 2021
Ernst & Young
–audit fee 6 5
– other services, tax 0 0
– other services, other 0 1
Total 6 6
Audit fee refers to audit of the n e financial statements and the accounting records. For the Parent Company
the audit also includes the administration of the business by the Board of Directors, the President and CEO.
Tax services include tax compliance services. Other services essentially comprise consultancy services.
At the Annual General Meeting Ernst & Young AB was re-elected as the company’s auditor until the end
of the annual general meeting 2023.
A4. Financial income and expenses
Financial income and expenses 2022 2021
Interest income:
– cash and cash equivalents 1 0
– receivables from Group companies 38 9
– derivatives – 0
Dividend income from Group companies 30 536 3 849
Capital gain – 0
Change in fair value:
– other assets 31 –
Foreign exchange gain, net 7 0
Financial income 30 613 3 858
Interest expense:
– borrowings –168 –189
– liabilities to Group companies –101 –29
Change in fair value:
– other liabilities –61 0
Foreign exchange loss, net –4 –1
Impairment loss:
– write-down of shares in Group companies –8 –175
Financial expenses –342 –394
Financial income, net 30 271 3 464
Following table presents the net gain or loss by category of nancial instruments.
Net gain/loss on 2022 2021
– loans and receivables, incl. bank deposits –126 –181
– other assets 31 –
– other liabilities –162 –29
Prot from shares in Group companies 30 528 3 674
Total 30 271 3 464
Prot from shares in Group companies mainly refers to dividend income from sub-
sidiaries and capital gains from transfer of shares in subsidiaries. These transac-
tions are eliminated in the Group accounts since they are internal. For further infor-
mation about the hedges, see note 27 of the consolidated nancial statements.
A3. Other operating income and expense
2022 2021
Commissions received 271 121
Other operating income 7 0
Total other operating income 278 121
Exchange-rate dierences, net –9 –1
Other operating expense
– 0
Total other operating expense –9 –1
Atlas Copco 2022 111
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A5. Appropriations
2022 2021
Group contributions paid –3 –9
Group contributions received 2 949 2 704
Total
2 946 2 695
A8. Property, plant and equipment
2022 2021
Buildings and land Machinery and equipment Total Buildings and land Machinery and equipment Total
Accumulated cost
Opening balance, Jan. 1 48 68 116 46 67 113
Investments 0 6 6 2 1 3
Disposals – –14 –14 – – –
Closing balance, Dec. 31 48 60 108 48 68 116
Accumulated depreciation
Opening balance, Jan. 1 19 63 82 16 59 75
Depreciation for the year 3 4 7 3 4 7
Disposals – –14 –14 – 0 0
Closing balance, Dec. 31 22 53 75 19 63 82
Carrying amount
Opening balance, Jan. 1 29 5 34 30 8 38
Closing balance, Dec. 31 26 7 33 29 5 34
Buildings and land relates to improvements in leased properties. Depreciation
is accounted for under administrative expenses in the Income Statement.
The leasing costs for assets, such as rented premises, cars and oce equip-
ment are reported among administrative expenses and amounted to 62 (58).
Future payments for non-cancelable leasing contracts amounted to 611 (175)
and fall due as follows in the table beside.
2022 2021
Less than one year 65 59
Between one and ve years 258 116
More than ve years 288 –
Total 611 175
A6. Income tax
2022 2021
Current tax –312 –219
Deferred tax –8 –120
Total –320 –339
Prot before taxes 32 753 5 515
The Swedish corporate tax rate, % 20.6 20.6
National tax based on prot before taxes –6 747 –1 137
Tax eects of:
– non-deductible expenses 70 –39
– tax exempt income 6 290 793
– deductible expenses, not recognized in
Income statement
3 26
– deductible income, not recognized in
Income statement
7 –
– tax nancial net 26 48
– controlled foreign company taxation –27 –24
– adjustments from prior years 58 –6
Total –320 –339
Eective tax in % 1.0 6.1
The Parent Company’s eective tax rate of 1.0% (6.1) is primarily aected by
non-taxable income such as dividends from Group companies.
A7. Intangible assets
Capitalized expenditures
for computer programs
2022 2021
Accumulated cost
Opening balance, Jan. 1 72 67
Investments – 5
Disposals –38 –
Closing balance, Dec. 31 34 72
Accumulated depreciation
Opening balance, Jan. 1 59 55
Depreciation for the year 5 4
Disposals –38 –
Closing balance, Dec. 31 26 59
Carrying amount
Opening balance, Jan. 1 13 12
Closing balance, Dec. 31 8 13
Atlas Copco 2022 112
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A9. Deferred tax assets and liabilities
2022 2021
Assets Liabi lities
Net
balance Assets Liabi lities
Net
balance
Post-employment
benets
42 – 42 42 – 42
Other provisions 13 – 13 21 – 21
Total 55 – 55 63 – 63
The following reconciles the net balance of deferred taxes at the beginning of
the year to that at the end of the year:
2022 2021
Net opening balance, Jan. 1 63 183
Charges to prot for the year –8 –120
Net closing balance, Dec. 31, net 55 63
A10. Shares in Group companies
2022 2021
Accumulated cost
Opening balance, Jan. 1 243 324 240 808
Investments 3 282
Net investment hedge 450 128
Shareholders’ contribution 15 477 2 106
Closing balance, Dec. 31 259 254 243 324
Accumulated write-up
Opening balance, Jan. 1 600 600
Closing balance, Dec. 31 600 600
Accumulated write-down
Opening balance, Jan. 1 –80 355 –80 180
Write-down –8 –175
Closing balance, Dec. 31 –80 363 –80 355
Total 179 491 163 569
For further information about Group companies, see note A21.
A11. Other nancial assets
2022 2021
Endowment insurances 199 201
Financial assets measured at amortized cost:
– other nancial receivables 56 22
Closing balance, Dec. 31 255 223
Endowment insurances relate to dened contribution pension plans and are
pledged to the pension beneciary (see note A15 and A20).
A12. Other receivables
2022 2021
Receivables from Group companies 4 396 9 288
Financial assets measured at amortized cost:
– other receivables 17 16
Prepaid expenses and accrued income 58 43
Closing balance, Dec. 31 4 471 9 347
A14. Equity
For information on share transactions and mandates approved by the Annual
General Meeting and proposed dividend for 2022, see note 20 in the consoli-
dated nancial statements.
Reserves
The Parent Company’s equity includes certain reserves which are described
as follows:
Legal reserve
The legal reserve is a part of the restricted equity and is not available for
distribution.
Reserve for fair value – Translation reserve
The reserve comprises translation of intragroup receivables from or liabilities
to foreign operations that in substance are part of the net investment in the
foreign operations, as well as cash ow hedges to convert variable interest
rates to xed interest rates.
A13. Cash and cash equivalents
2022 2021
Cash and cash equivalents measured at
amortized cost:
– cash 0
0
Closing balance, Dec. 31 0 0
The Parent Company’s guaranteed, but unutilized, credit lines equaled
7133 (6 551).
Atlas Copco 2022 113
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A15. Post-employment benets
2022 2021
Dened contribution
pension plans
Dened benet
pension plans Total
Dened contribution
pension plans
Dened benet
pension plans Total
Opening balance, Jan. 1 201 4 205 183 5 188
Provision made 26
1
27 42
– 42
Provision used –28 –1 –29 –24 –1 –25
Closing balance, Dec. 31 199
4
203 201
4 205
The Parent Company has endowment insurances of 199 (201) relating to dened contribution pension plans. The insurances are recognized as other nancial
assets, and pledged to the pension beneciary.
Description of dened benet pension plans
The Parent Company has two dened benet pension plans. The ITP plan is a nal salary pension plan covering the majority of salaried employees in Atlas Copco
AB which benets are secured through the Atlas Copco pension trust. The second plan relates to retired former senior employees. These pension arrangements
are provided for.
2022 2021
Funded pension Unfunded pension Total Funded pension Unfunded pension Total
Dened benet obligations 172 4 176 150 5 155
Fair value of plan assets –625 – –625 –672 – –672
Present value of net obligations –453 4 –449 –522 5 –517
Not recognized surplus 453 – 453 522 – 522
Net amount recognized in balance sheet 0 4 4 – 5 5
2022 2021
Reconciliation of dened benet obligations
Funded pension Unfunded pension Total Funded pension Unfunded pension Total
Dened benet obligations at Jan. 1 150 5 155 147 5 152
Service cost 4 0 4 4 – 4
Interest expense 4 0 4 5 – 5
Benets paid from plan –8 –1 –9 –8 –1 –9
Other changes in obligations 22 0 22 2 1 3
Dened benet obligations at Dec. 31 172 4 176 150 5 155
2022 2021
Reconciliation of plan assets
Funded pension Unfunded pension Total Funded pension Unfunded pension Total
Fair value of plan assets at Jan. 1 672 – 672 460 – 460
Return on plan assets –39 – –39 220 – 220
Payments/Renumeration of plan assets –8 – –8 –8 – –8
Fair value of plan assets at Dec. 31 625 – 625 672 – 672
2022 2021
Pension commitments provided
for in the balance sheet
Costs excluding interest 16 15
Total 16 15
Pension commitments provided for through
insurance contracts
Service cost
25 23
Total 25 23
Net cost for pensions, excluding taxes 41 38
Special employer’s contribution 7 6
Total 48 44
Pension expenses excluding taxes for the year, included within administrative
expenses amounted to 41 (38) of which the Board members and Group
Management 12 (12) and others 29 (26).
The Parent Company’s share in plan assets fair value in the Atlas Copco
pension trust amounts to 625 (672) and is allocated as follows:
2022 2021
Equity securities 61 54
Bonds 38 50
Real estate – 308
Alternative investments 260 212
Cash and cash equivalents 266 48
Total 625 672
The plan assets of the Atlas Copco pension trust are not included in the
nancial assets of the Parent Company.
The return on plan assets in the Atlas Copco pension trust amounted to
–6.91% (47.7) inclusive of MSEK 8.1 (7.7) paid remuneration.
The Parent Company adheres to the actuarial assumptions used by
TheSwedish Pension Registration Institute (PRI) i.e. discount rate 2.9% (2.9).
The Parent Company estimates MSEK 13 will be paid to dened benet
pension plans during 2023.
Atlas Copco 2022 114
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A16. Other provisions
2022 2021
Opening balance, Jan. 1 813 478
During the year:
– provisions made –245 496
– provisions used –67 –161
Closing balance, Dec. 31 501 813
Other provisions include primarily provisions for costs related to employee
option programs accounted for in accordance with IFRS 2 and UFR 7.
A17. Borrowings
2022 2021
Maturity Repurchased nominal amount Carrying amount Fair value Carrying amount Fair value
Non-current
Medium Term Note Program MEUR 500 2023 MEUR 186 2 861 3 500 4 552 5 283
Medium Term Note Program MEUR 500 2026
5 076 5 063
5 074 5 226
Bilateral borrowings EIB MEUR 200 2022 MEUR 100 – – 926 1 026
Bilateral borrowings NIB MEUR 200 2024 2 100 2 257 2 100 2 078
Bilateral borrowings EIB MEUR 200 2027 2 030 1 958 2 030 2 051
Bilateral borrowings EIB MEUR 100 2028 1 012 959 1 012 1 024
Non-current borrowings from Group companies 8 314 9 614 7 427 7 165
Less current portion of long-term borrowings –2 861 –3 500 –926 –1 026
Total non-current borrowings 18 532 19 851 22 195 22 827
Current
Current portion of long-term borrowings 2 861 3 500 926 1 026
Total current borrowings 2 861 3 500 926 1 026
Closing balance, Dec. 31 21 393 23 351 23 121 23 853
Whereof external borrowings 13 079 13 737 15 694 16 688
The dierence between carrying value and fair value relates to the measurement method as certain liabilities are reported at amortized cost and not at fair value.
Changes in interest rates and credit margins create the dierence between fair value and amortized cost. In 2022, Atlas Copco AB reduced its external borrowings.
In February, MEUR 186 of a MEUR 500 public bond with maturity February 2023 was repurchased and in December MEUR 100 of a maturing EIB loan was repaid.
The following table shows the maturity structure of the Parent Company’s
external borrowings.
Maturity Fixed Floating
1)
Carrying amount Fair value
2023 2 861 – 2 861 3 500
2024 – 2 100 2 100 2 257
2026 5 076 – 5 076 5 063
2027 2 030 – 2 030 1 958
2028 1 012 – 1 012 959
Total 10 979 2 100 13 079 13 737
1)
Floating interest in the table is borrowings with xings shorter or equal to six months.
Atlas Copco 2022 115
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A18 . Other liabilities
2022 2021
Accounts payable
15
16
Liabilities to Group companies 90 64
Other nancial liabilities:
– other liabilities 38 16
Accrued expenses and prepaid income 232 248
Closing balance, Dec. 31 375 344
Accrued expenses include items such as social costs, vacation pay liability, and
accrued interest.
A19.
Financial exposure and principles for control
of nancial risks
A20. Assets pledged and contingent liabilities
2022 2021
Assets pledged for pension commitments
Endowment insurances
199 201
Total 199 201
Contingent liabilities
Sureties and other contingent liabilities:
– for external parties 3 4
– for Group companies 10 063 3 262
Total 10 066 3 266
Sureties and other contingent liabilities include bank and commercial guaran-
tees and performance bonds. The increase compared to last year mainly
derives from the issuance of an EMTN bond for the total amount of 5572 MSEK
and Parent Company Guarantees provided by Atlas Copco AB on behalf of its
subsidiaries.
Parent Company borrowings
Atlas Copco AB had MSEK 13079 (15694) of external borrowings and MSEK
8314 (7427) of internal borrowings at December 31, 2022. Derivative instru-
ments are used to manage the currency and interest rate risk in line with
policies set by the Financial Risk Management Committee, see note 27 in the
consolidated nancial statements.
Hedge accounting
The Parent Company hedges shares in subsidiaries through loans of MEUR
2392 (2291) and derivatives of MEUR 0 (100). The deferral hedge accounting
of the loans is based on a RFR 2 exemption. The derivative is an internal con-
tract with Atlas Copco Finance DAC resulting with MSEK 0 (–4) to Receivables
from Group companies in below table.
Financial credit risk
Credit risk on nancial transactions is the risk that the Parent Company incurs
losses as a result of non-payment by counterparts related to the Parent
Company’s investments, bank deposits or derivative transactions. For further
information regarding investment and derivative transactions, see note 27 of
the consolidated nancial statements. The table below shows the actual expo-
sure of nancial instruments as per December 31.
Financial credit risk 2022 2021
Cash and cash equivalents 0 0
Receivables from Group companies 4 396 9 288
Other 131 81
Total 4 527 9 369
Fair value hierarchy
Fair values are based on observable market prices or, in the case that such prices
are not available, on observable inputs or other valuation techniques. Amounts
shown in other notes are unrealized and will not necessarily be realized. For
more information about fair value hierarchy, see note 27 of the consolidated
nancial statements. There are no level 3 instruments in the Parent Company.
Valuation methods
Derivatives
Fair values of forward exchange contracts are calculated based on prevailing
markets. Interest rate swaps are valued based on market rates and present
value of future cash ows.
Interest-bearing liabilities
Fair values are calculated based on market rates and present value of future
cash ows.
The Parent Company’s nancial instruments by category
The carrying value for the Parent Company’s nancial instruments corresponds
to fair value in all categories except for borrowings. See A17 for additional
information.
Atlas Copco 2022 116
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A21. Directly owned subsidiaries
2022 2021
Number of
shares
Percent
held
Carrying
value
Number of
shares
Percent
held
Carrying
value
Directly owned product companies
Atlas Copco Airpower n.v., Wilrijk 76 416 100 46 744 76 415 100 46 806
Directly owned customer centers
AGRE Kompressoren GmbH, Steyr 200 000 100 7 200 000 100 7
ALUP Kompressoren AG, Oftringen 3 500 100 25 3 500 100 25
ALUP Kompressoren Polska sp. z.o.o.,
Janki
9 000 100 14 9 000 100 14
Atlas Copco (Cyprus) Ltd., Nicosia 99 998 100 0 99 998 100 0
Atlas Copco (India) Ltd., Pune 21 731 917 100 898 21 731 917 100 874
Atlas Copco (Ireland) Ltd., Dublin 250 000 100 28 250 000 100 28
Atlas Copco (Malaysia), Sdn. Bhd.,
Shah Alam
1 000 000 100 13 1 000 000 100 14
Atlas Copco (Philippines) Inc., Binan 677 980 100 69 677 980 100 69
Atlas Copco (Schweiz) AG, Studen 8 000 100 64 8 000 100 63
Atlas Copco (South East Asia) Pte.Ltd.,
Singapore
4 500 000 100 35 4 500 000 100 35
Atlas Copco (Thailand) Limited,
Bangkok
1 0/100
1)
0 – –/100
1)
–
Atlas Copco Argentina S.A.C.I.,
Buenos Aires
5 120 025 93/100
1)
84 5 120 025 93/100
1)
84
Atlas Copco Brasil Ltda, Barueri 70 358 841 100 255 70 358 841 100 257
Atlas Copco Canada Inc., Toronto 6 946 100 2 185 6 946 100 2 185
Atlas Copco Chile SpA, Santiago 24 998 100 7 24 998 100 6
Atlas Copco Compressor AB,
556155-2794, Nacka
60 000 100 36 60 000 100 36
Atlas Copco Eastern Africa Limited,
Nairobi
482 999 100 40 482 999 100 40
Atlas Copco Equipment Egypt
S.A.E., Cairo
5 0/100
1)
5 5 0/100
1)
4
Atlas Copco GmbH, Vienna 1 100 43 1 100 43
Atlas Copco Indoeuropeiska AB,
556155-2760, Nacka
3 500 100 20 3 500 100 20
Atlas Copco KK, Tokyo 100 000 100 39 100 000 100 39
Atlas Copco Kompressorteknik A/S,
Albertslund
4 000 100 5 4 000 100 5
Atlas Copco Maroc SA, Casablanca 3 960 99 6 3 960 99 6
Atlas Copco Polska Sp. z o.o., Warsaw 4 000 100 80 4 000 100 80
Atlas Copco Services Middle East
OMC, Manama
500 100 24 500 100 27
2022 2021
Number of
shares
Percent
held
Carrying
value
Number of
shares
Percent
held
Carrying
value
Atlas Copco Ukraine LLC, Kiev 10 000 000
100
3 10 000 000
100 3
Atlas Copco Venezuela SA,
Valencia
1 592 100 9 25 812 000 100 0
Sociedade Atlas Copco Portugal
Unipessoal Ld, Porto Salvo
1 100 15 1 100 15
Directly owned holding companies
and others
AB Atlas Diesel, 556019-1610, Nacka 1000 100 0 1 000 100 0
Atlas Copco A/S, Langhus 2 500 100 45 2 500 100 44
Atlas Copco Beheer B.V., Zwijndrecht 15 712 100 76 15 712 100 84
Atlas Copco Finance Belgium BVBA,
Wilrijk
1 0/100
1)
0 1 0/100
1)
0
Atlas Copco Finance DAC, Dublin 5 162 000 001 100 54 878 5 162 000 001 100 54 428
Atlas Copco France Holding S.A.,
Cergy Pontoise
278 255 100 321 278 255 100 341
Atlas Copco Holding GmbH, Essen 2 100 9 377 2 100 4 351
Atlas Copco Internationaal B.V.,
Zwijndrecht
10 002 100 27 455 10 002 100 27 455
Atlas Copco Järla Holding AB,
556062-0212, Nacka
95 000 100 716 95 000 100 716
Atlas Copco Nacka Holding AB,
556397-7452, Nacka
100 000 100 12 100 000 100 12
Atlas Copco Sickla Holding AB,
556309-5255, Nacka
1 000 100 35 590 1 000 100 25 084
Econus S A, Montevideo 21 582 605 100 17 21 582 605 100 17
Industria Försäkringsaktiebolag,
Industria Insurance Company Ltd
516401-7930, Nacka
300 000 100 30 300 000 100 30
JSC Atlas Copco, Moscow 2 644 100 185 2 644 100 185
Oy Atlas Copco Ab, Vantaa 150 100 33 150 100 33
Power Tools Distribution n.v., Hoeselt 1 0/100
1)
3 1 0/100
1)
4
Saltus Industrial Technique AB,
559053-5455, Nacka
500 100 0 500 100 0
Carrying amount, Dec. 31 179 491 163 569
1)
First t figure: percentage held by Parent Company, second nd figure: percentage held by Atlas Copco Group.
Atlas Copco 2022 117
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A22. Related parties
Relationships
The Parent Company has related party relationships with its largest share-
holder, its subsidiaries, its associates, its joint ventures and with its Board
members and Group Management.
The Parent Company’s largest shareholder, Investor AB, controls approxi-
mately 22% (22) of the voting rights in Atlas Copco AB.
The subsidiaries that are directly owned by the Parent Company are pre-
sented in note A21 and all directly and indirectly owned operating subsidiaries
are listed on the following pages.
Information about Board members and Group Management is presented
on pages 55–58.
Transactions and outstanding balances
The Group has not had any transactions with Investor AB during the year other
than dividends declared and has no outstanding balances with Investor AB.
Investor AB has controlling or signic ficant in t influence in companies which Atlas
Copco AB may have transactions with in the normal course of business. Any
such transactions are made on com mercial terms.
The following table summarizes the Parent Company’s transactions with
Group companies:
2022 2021
Revenues
Dividends 30 536 3 849
Group contribution 2 949 2 704
Interest income 38 9
Expenses
Group contribution –3 –9
Interest expenses –101 –29
Receivables 4 396 9 288
Liabilities 8 404 7 491
Guarantees 10 063 3 262
The following details directly and indirectly owned holding and operational
subsidiaries (excluding branches), presented by country/area of incorporation.
Country/Area Company Location (City)
Algeria SPA Atlas Copco Algérie Algiers
Angola Atlas Copco Angola Ltd Luanda
Argentina Atlas Copco Argentina S.A.C.I. Buenos Aires
Australia Atlas Copco Australia Pty Ltd Blacktown
LEWA Australia PTY LTD East Perth
SCS Filtration Melbourne
Walker Filtration Pty. Australia Melbourne
Austria AGRE Kompressoren GmbH Steyr
Atlas Copco GmbH Vienna
LEWA Austria GmbH Vienna
Atlas Copco 2022 118
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A22. Related parties, continued
Country/Area Company Location (City)
Finland Oy Atlas Copco Ab Vantaa
Oy Atlas Copco Kompressorit Ab Vantaa a
Oy Atlas Copco Tools Ab Vantaa fi
France ABAC France S.A.S. Valence
Atlas Copco Applications Industrielles S.A.S. Cergy Pontoise
Atlas Copco Crépelle S.A.S. Lille
Atlas Copco France Holding S.A. Cergy Pontoise
Atlas Copco France SAS Cergy Pontoise
Edwards SAS Herblay
ETS Georges Renault S.A.S. Saint-Herblain
Exlair S.A.S. Saint Ouen L’Aûmone
FITEC Tarnos
LEWA France SAS Neuville-sur-Oise
Leybold France SAS Bourg-Les-Valence
MultiAir France S.A.S Chambly
Perceptron EURL Montigny le Bretonneux
Seti-Tec S.A.S. Lognes
Germany 3D-Shape GmbH Erlangen
ARPUMA regel- und fördertechnische Geräte GmbH Kerpen
Atlas Copco Beteiligungs GmbH H ¹ Essen
Atlas Copco Energas GmbH bH ¹ Cologne
Atlas Copco Holding GmbH H ¹ Essen
Atlas Copco IAS GmbH bH ¹ Bretten
Atlas Copco Industry GmbH H ¹ Essen
Atlas Copco Kompressoren und Drucklufttechnik GmbH H ¹ Essen
Atlas Copco Power Technique GmbH bH ¹ Essen
Atlas Copco Tools Central Europe GmbH bH ¹ Essen
Desoutter GmbH bH ¹ Maintal
DF Druckluft-Fachhandel GmbH GmbH ¹ Herrenberg
Dipotec GmbH
1
Neustadt a.d. Donau
Edwards GmbH Kirchheim
Ehrler & Beck Vakuum- und Drucklufttechnik GmbH H ¹ Renningen
GP Inspect GmbH Neuried
GP Solar GmbH Neuried
ISRA Immobilie Darmstadt GmbH H ¹ Darmstadt
ISRA PARSYTEC GmbH bH ¹ Aachen
ISRA SURFACE VISION GmbH H ¹ Herten
ISRA VISION GmbH bH ¹ Darmstadt
ISRA VISION Graphikon GmbH Berlin
ISRA VISION LASOR GmbH Bielefeld
ISRA VISION PARSYTEC AG C AG ¹ Aachen
1)
For the business year ending December 31, 2022 several German subsidiaries will make
use of the §§ 264, 291 Handelsgesetzbuch (German Commercial Code) exemption
rules of ling their own (consolidated) nancial statements.
Atlas Copco 2022 119
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
A22. Related parties, continued
Atlas Copco 2022 120
FINANCIAL STATEMENTS – NOTES
Introduction
This is Atlas Copco
The year in review
• Financials
Group
Consolidated income
statement
Consolidated statement of
comprehensive income
Consolidated balance sheet
Consolidated statement of
changes in equity
Consolidated statement of
cash ows
Notes
• Parent company
Other information
Signatures of the Board of Directors
The Parent Company nancial statements have been prepared in accordance with generally
accepted accounting principles in Sweden and the consolidated nancial statements have been
prepared in accordance with International Accounting Standards as prescribed by the European
Parliament and the Regulation (EC) No 1606/2002 dated July 19, 2002 on the application of Inter-
national Accounting Standards. The Parent Company nancial statements and the consolidated
nancial statements give a true and fair view of the Parent Company’s and the Group’s nancial
position and results of operations.
Our audit report was submitted on March 20, 2023,
Ernst & Young AB
Erik Sandström
Authorized Public Accountant
Atlas Copco AB is required to publish information included in this annual report in accordance with
the Swedish Securities Market Act. The information was made public on March 22, 2023.
Mats Rahmström Gordon Riske Peter Wallenberg Jr Mikael Bergstedt Benny Larsson
Board member
President and CEO
Board member Board member Board member
Employee representative
Board member
Employee representative
Nacka, March 3, 2023, Atlas Copco AB
Hans Stråberg Staan Bohman Johan Forssell Heléne Mellquist Anna Ohlsson-Leijon
Chair Board member Board member Board member Board member
The administration report for the Group and Parent Company provides a true and fair overview of the
development of the Group’s and Parent Company’s business activities, nancial position and results of
operations as well as the signicant risks and uncertainties which the Parent Company and its subsidiaries
are exposed to.
The Annual Report also contains the Group’s and Parent Company’s statutory sustainability report
in accordance with the Swedish Annual Accounts Act, Chapter 6, Section 11, see page 19.
Atlas Copco 2022 121
SIGNATURES OF THE BOARD OF DIRECTORS
Introduction
This is Atlas Copco
The year in review
Financials
Other information
• Signatures of the Board
of Directors
Audit Report
Financial denitions
Sustainability notes
Four years in summary
Contacts
Audit report
To the general meeting of the shareholders of Atlas Copco AB (publ),
corporate identity number 556014-2720
Report on the annual accounts and consolidated accounts
Opinions
We have audited the annual accounts and consolidated accounts of Atlas
Copco AB (publ) for the year 2022 except for the corporate governance state-
ment on pages 51–60 and the quarterly data on page 80. The annual accounts
and consolidated accounts of the company are included on pages 13–39,
44–48 and 61–121 in this document.
In our opinion, the annual accounts have been prepared in accordance with
the Annual Accounts Act and present fairly, in all material respects, the nan-
cial position of the parent company as of December 31, 2022 and its nancial
performance and cash ow for the year then ended in accordance with the
Annual Accounts Act. The consolidated accounts have been prepared in accor-
dance with the Annual Accounts Act and present fairly, in all material respects,
the nancial position of the group as of December 31, 2022 and their nancial
performance and cash ow for the year then ended in accordance with Inter-
national Financial Reporting Standards (IFRS), as adopted by the EU, and the
Annual Accounts Act. Our opinions do not cover the corporate governance
statement on pages 51–60. The statutory administration report is consistent
with the other parts of the annual accounts and consolidated accounts.
We therefore recommend that the general meeting of shareholders adopts
the income statement and balance sheet for the parent company and the
group.
Our opinions in this report on the annual accounts and consolidated
accounts are consistent with the content of the additional report that has been
submitted to the parent company’s audit committee in accordance with the
Audit Regulation (537/2014) Article 11.
Basis for Opinions
We conducted our audit in accordance with International Standards on Audit-
ing (ISA) and generally accepted auditing standards in Sweden. Our responsi-
bilities under those standards are further described in the Auditor’s Responsi-
bilities section. We are independent of the parent company and the group in
accordance with professional ethics for accountants in Sweden and have oth-
erwise fullled our ethical responsibilities in accordance with these require-
ments. This includes that, based on the best of our knowledge and belief, no
prohibited services referred to in the Audit Regulation (537/2014) Article 5.1
have been provided to the audited company or, where applicable, its parent
company or its controlled companies within the EU.
We believe that the audit evidence we have obtained is sucient and
appropriate to provide a basis for our opinions.
Key Audit Matters
Key audit matters of the audit are those matters that, in our professional judg-
ment, were of most signicance in our audit of the annual accounts and con-
solidated accounts of the current period. These matters were addressed in the
context of our audit of, and in forming our opinion thereon, the annual
accounts and consolidated accounts as a whole, but we do not provide a sepa-
rate opinion on these matters. For each matter below, our description of how
our audit addressed the matter is provided in that context.
We have fullled the responsibilities described in the Auditor’s responsibilities
for the audit of the nancial statements section of our report, including in rela-
tion to these matters. Accordingly, our audit included the performance of
procedures designed to respond to our assessment of the risks of material
misstatement of the nancial statements. The results of our audit procedures,
including the procedures performed to address the matters below, provide
the basis for our audit opinion on the accompanying nancial statements.
Accounting for business combinations
Description
In the scal year 2022, Atlas Copco made 30 acquisitions for a total consideration
of 12.1 billion SEK. The acquired assets and liabilities must be separately identi-
ed and valued at fair value at the date of the acquisition. For acquired assets
and liabilities for which there is no active market management must apply
valuation models and signicant estimates in order to determine the fair value.
Disclosures related to the group’s accounting principles, signicant
accounting estimates and judgements are provided in note 1 and note 2
contains disclosures related to the acquisitions made.
Based on the signicance of the acquisitions and the high degree of man-
agement estimate required to account for these matters, we have assessed the
accounting for business combinations as a key audit matter in our audit.
How our audit addressed this key audit matter
As part of our audit we have evaluated the group’s processes related to the
accounting of business combinations. We have reviewed the purchase agree-
ments and audited the purchase price allocations for all signicant acquisitions.
With support from our internal valuation specialists, we have assessed the
valuation models applied and the signicant estimates used when accounting
for the business combinations. The models and estimates have been tested by
comparing them to historical outcome, future cash ow forecasts as well as
external sources and established valuation techniques. Further we have per-
formed sensitivity analyzes for signicant estimates as well as benchmark
comparisons.
Finally, we have assessed the appropriateness of the disclosures provided
in the annual report.
Valuation of goodwill
Description
At December 31, 2022, the total value of goodwill amounts to 44.3 billion SEK
and is allocated to the group’s dierent cash generating units. Goodwill must
be tested for impairment at least annually or whenever there are indicators of
impairment. The test is carried out by comparing the recoverable amount to
the carrying value. To calculate the recoverable amount management apply
signicant judgment and estimates regarding future cash ows, terminal
growth rate and discount rates. The impairment tests for 2022 did not result
in any impairment write o.
Disclosures related to the group’s accounting principles, signicant account-
ing estimates and judgements are provided in note 1 and disclosures related
to goodwill and the impairment test performed are provided in note 12.
Based on carrying value of the goodwill and the high degree of manage-
ment estimate required to perform the impairment tests, we have assessed
the accounting for the valuation of goodwill as a key audit matter in our audit.
How our audit addressed this key audit matter
In the audit, we have evaluated the group’s process for conducting impair-
ment tests. Based on established criteria, we have examined how the group
identies cash-generating units.
With support from our internal valuation specialists, we have evaluated the
valuation methods used. We have assessed the reasonableness of assump-
tions, conducted sensitivity analysis, and compared them to historical out-
comes as well as external sources and industry benchmarks.
Finally, we have assessed the appropriateness of the disclosures provided in
the annual report.
Revenue recognition
Description
The group recognize revenue from a wide range of geographical markets and
the revenues are generated from product- and product related oerings rang-
ing from equipment, service and rental to the customers. The appropriate tim-
ing of revenue recognition can vary from a point in time to recognition over
time. Judgement may be required in assessing if control has been transferred
to the customer and to determine the satisfaction of performance obligations.
The group’s decentralized organization where revenues are generated from
a large number of subsidiaries further increases the complexity of ensuring that
the revenue recognition principles are consistently applied across the group.
Disclosures related to the group’s accounting principles, critical accounting
estimates and judgement are provided in note 1 and note 4 provides disclo-
sures regarding revenue disaggregated by operating segment and geography.
Based on the above, we have assessed the revenue recognition as a key
audit matter in our audit.
How our audit addressed this key audit matter
In our audit we have assessed the group’s processes for revenue recognition.
Further, we have reviewed the group’s accounting manual and assessed
whether the policies for revenue recognition are in accordance with the appli-
cable accounting standards.
We have obtained an understanding of the dierent types of signicant
revenue contracts and evaluated the identied performance obligations and
determinations made regarding when performance obligations are considered
satised. In addition, we have performed detailed revenue transaction testing
and revenue data analytical procedures to assess the revenue recognition.
We have assessed the appropriateness of the disclosures provided in the
annual report.
Accounting for income taxes
Description
Atlas Copco is a global group with subsidiaries world-wide. The accounting for
income taxes requires adherence to local tax legislation which often can be
complex and allow for dierent interpretations and judgement. The group’s
subsidiaries are regularly subject to tax audits in which the local tax authorities
might challenge the group’s interpretation of the local legislation.
In instances where the tax authorities are of a dierent opinion of how to
interpret the tax legislation the outcome is often dependent on negotiations
with the local tax authorities or legal proceedings. In order to account for
income taxes in these instances, management may have to apply signicant
Atlas Copco 2022 122
AUDIT REPORT
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
• Audit Report
Financial denitions
Sustainability notes
Four years in summary
Contacts
estimates. Changes to these estimates can have a material eect on the
income tax reported.
Disclosures related to the group’s accounting principles, critical accounting
estimates and judgement are provided in note 1 and disclosures related to
taxes are provided in note 9.
Based on the above, we have assessed accounting for income taxes as a
key audit matter in our audit.
How our audit addressed this key audit matter
We have evaluated the group’s process for accounting for income taxes. We
have reviewed communication between Atlas Copco and the tax authorities
for signicant uncertain income tax matters. Our internal tax specialists have
been engaged to evaluate the assessments and interpretations made by the
group. We have also assessed the reasonability of the accounting for these
matters by comparisons to historical outcome in similar cases and by obtaining
assessments from the group’s external tax advisors where appropriate.
We have assessed the appropriateness of the disclosures provided in the
annual report.
Other Information than the annual accounts and consolidated accounts
This document also contains other information than the annual accounts
and consolidated accounts and is found on pages 1–12, 40–43, 49–50 and
125–148. The Board of Directors and the Managing Director are responsible
for this other information.
Our opinion on the annual accounts and consolidated accounts does not
cover this other information and we do not express any form of assurance
conclusion regarding this other information.
In connection with our audit of the annual accounts and consolidated
accounts, our responsibility is to read the information identied above and
consider whether the information is materially inconsistent with the annual
accounts and consolidated accounts. In this procedure we also take into
account our knowledge otherwise obtained in the audit and assess whether
the information otherwise appears to be materially misstated.
If we, based on the work performed concerning this information, conclude
that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard.
Responsibilities of the Board of Directors and the Managing Director
The Board of Directors and the Managing Director are responsible for the
preparation of the annual accounts and consolidated accounts and that they
give a fair presentation in accordance with the Annual Accounts Act and, con-
cerning the consolidated accounts, in accordance with IFRS as adopted by the
EU. The Board of Directors and the Managing Director are also responsible for
such internal control as they determine is necessary to enable the preparation
of annual accounts and consolidated accounts that are free from material mis-
statement, whether due to fraud or error.
In preparing the annual accounts and consolidated accounts, The Board of
Directors and the Managing Director are responsible for the assessment of the
company’s and the group’s ability to continue as a going concern. They disclose,
as applicable, matters related to going concern and using the going concern
basis of accounting. The going concern basis of accounting is however not
applied if the Board of Directors and the Managing Director intends to liquidate
Audit report, continued
the company, to cease operations, or has no realistic alternative but to do so.
The Audit Committee shall, without prejudice to the Board of Director’s
responsibilities and tasks in general, among other things oversee the
company’s nancial reporting process.
Auditor’s responsibility
Our objectives are to obtain reasonable assurance about whether the annual
accounts and consolidated accounts as a whole are free from material mis-
statement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinions. Reasonable assurance is a high level of assurance, but is
not a guarantee that an audit conducted in accordance with ISAs and gener-
ally accepted auditing standards in Sweden will always detect a material mis-
statement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably
be expected to inuence the economic decisions of users taken on the basis of
these annual accounts and consolidated accounts.
As part of an audit in accordance with ISAs, we exercise professional judg-
ment and maintain professional skepticism throughout the audit.
We also:
• Identify and assess the risks of material misstatement of the annual
accounts and consolidated accounts, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit
evidence that is sucient and appropriate to provide a basis for our opin-
ions. The risk of not detecting a material misstatement resulting from fraud
is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of inter-
nal control.
• Obtain an understanding of the company’s internal control relevant to our
audit in order to design audit procedures that are appropriate in the cir-
cumstances, but not for the purpose of expressing an opinion on the eec-
tiveness of the company’s internal control.
• Evaluate the appropriateness of accounting policies used and the reason-
ableness of accounting estimates and related disclosures made by the
Board of Directors and the Managing Director.
• Conclude on the appropriateness of the Board of Directors’ and the Man-
aging Director’s use of the going concern basis of accounting in preparing
the annual accounts and consolidated accounts. We also draw a conclu-
sion, based on the audit evidence obtained, as to whether any material
uncertainty exists related to events or conditions that may cast signicant
doubt on the company’s and the group’s ability to continue as a going con-
cern. If we conclude that a material uncertainty exists, we are required to
draw attention in our auditor’s report to the related disclosures in the
annual accounts and consolidated accounts or, if such disclosures are inad-
equate, to modify our opinion about the annual accounts and consolidated
accounts. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may
cause a company and a group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the annual
accounts and consolidated accounts, including the disclosures, and whether
the annual accounts and consolidated accounts represent the underlying
transactions and events in a manner that achieves fair presentation.
• Obtain sucient and appropriate audit evidence regarding the nancial
information of the entities or business activities within the group to express
an opinion on the consolidated accounts. We are responsible for the direc-
tion, supervision and performance of the group audit. We remain solely
responsible for our opinions.
We must inform the Board of Directors of, among other matters, the planned
scope and timing of the audit. We must also inform of signicant audit ndings
during our audit, including any signicant deciencies in internal control that
we identied.
We must also provide the Board of Directors with a statement that we have
complied with relevant ethical requirements regarding independence, and to
communicate with them all relationships and other matters that may reason-
ably be thought to bear on our independence, and where applicable, actions
taken to eliminate threats or related safeguards applied.
From the matters communicated with the Board of Directors, we determine
those matters that were of most signicance in the audit of the annual
accounts and consolidated accounts, including the most important assessed
risks for material misstatement, and are therefore the key audit matters.
We describe these matters in the auditor’s report unless law or regulation
precludes disclosure about the matter.
Report on other legal and regulatory requirements
Opinions
In addition to our audit of the annual accounts and consolidated accounts, we
have also audited the administration of the Board of Directors and the Manag-
ing Director of Atlas Copco AB (publ) for the year 2021 and the proposed
appropriations of the company’s prot or loss.
We recommend to the general meeting of shareholders that the prot be
appropriated (loss be dealt with) in accordance with the proposal in the statu-
tory administration report and that the members of the Board of Directors and
the Managing Director be discharged from liability for the nancial year.
Basis for opinions
We conducted the audit in accordance with generally accepted auditing
standards in Sweden. Our responsibilities under those standards are further
described in the Auditor’s Responsibilities section. We are independent of the
parent company and the group in accordance with professional ethics for
accountants in Sweden and have otherwise fullled our ethical responsibilities
in accordance with these requirements.
We believe that the audit evidence we have obtained is sucient and
appropriate to provide a basis for our opinions.
Responsibilities of the Board of Directors and the Managing Director
The Board of Directors is responsible for the proposal for appropriations of the
company’s prot or loss. At the proposal of a dividend, this includes an assess-
ment of whether the dividend is justiable considering the requirements
which the company’s and the group’s type of operations, size and risks place
on the size of the parent company’s and the group’s equity, consolidation
requirements, liquidity and position in general.
The Board of Directors is responsible for the company’s organization and
the administration of the company’s aairs. This includes among other things
Atlas Copco 2022 123
AUDIT REPORT
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
• Audit Report
Financial denitions
Sustainability notes
Four years in summary
Contacts
continuous assessment of the company’s and the group’s nancial situation
and ensuring that the company’s organization is designed so that the account-
ing, management of assets and the company’s nancial aairs otherwise are
controlled in a reassuring manner. The Managing Director shall manage the
ongoing administration according to the Board of Directors’ guidelines and
instructions and among other matters take measures that are necessary to ful-
ll the company’s accounting in accordance with law and handle the manage-
ment of assets in a reassuring manner.
Auditor’s responsibility
Our objective concerning the audit of the administration, and thereby our
opinion about discharge from liability, is to obtain audit evidence to assess
with a reasonable degree of assurance whether any member of the Board of
Directors or the Managing Director in any material respect:
• has undertaken any action or been guilty of any omission which can give
rise to liability to the company, or
• in any other way has acted in contravention of the Companies Act, the
Annual Accounts Act or the Articles of Association.
Our objective concerning the audit of the proposed appropriations of the
company’s prot or loss, and thereby our opinion about this, is to assess with
reasonable degree of assurance whether the proposal is in accordance with
the Companies Act.
Reasonable assurance is a high level of assurance, but is not a guarantee
that an audit conducted in accordance with generally accepted auditing stan-
dards in Sweden will always detect actions or omissions that can give rise to
liability to the company, or that the proposed appropriations of the compa-
ny’s prot or loss are not in accordance with the Companies Act.
As part of an audit in accordance with generally accepted auditing stan-
dards in Sweden, we exercise professional judgment and maintain profes-
sional skepticism throughout the audit. The examination of the administra-
tion and the proposed appropriations of the company’s prot or loss is based
primarily on the audit of the accounts. Additional audit procedures per-
formed are based on our professional judgment with starting point in risk and
materiality. This means that we focus the examination on such actions, areas
and relationships that are material for the operations and where deviations
and violations would have particular importance for the company’s situation.
We examine and test decisions undertaken, support for decisions, actions
taken and other circumstances that are relevant to our opinion concerning
discharge from liability. As a basis for our opinion on the Board of Directors’
proposed appropriations of the company’s prot or loss we examined the
Board of Directors’ reasoned statement and a selection of supporting evi-
dence in order to be able to assess whether the proposal is in accordance
with the Companies Act.
The auditor’s examination of the ESEF report
Opinion
In addition to our audit of the annual accounts and consolidated accounts, we
have also examined that the Board of Directors and the Managing Director
have prepared the annual accounts and consolidated accounts in a format that
enables uniform electronic reporting (the ESEF report) pursuant to Chapter 16,
Audit report, continued
Section 4(a) of the Swedish Securities Market Act (2007:528) for Atlas Copco
AB for the nancial year 2022.
Our examination and our opinion relate only to the statutory requirements.
In our opinion, the ESEF report has been prepared in a format that, in all
material respects, enables uniform electronic reporting.
Basis for opinion
We have performed the examination in accordance with FAR’s recommenda-
tion RevR 18 Examination of the ESEF report. Our responsibility under this
recommendation is described in more detail in the Auditors’ responsibility
section. We are independent of Atlas Copco AB in accordance with profes-
sional ethics for accountants in Sweden and have otherwise fullled our
ethical responsibilities in accordance with these requirements.
We believe that the evidence we have obtained is sucient and appropriate
to provide a basis for our opinion.
Responsibilities of the Board of Directors and the Managing Director
The Board of Directors and the Managing Director are responsible for the
preparation of the ESEF report in accordance with Chapter 16, Section 4(a) of
the Swedish Securities Market Act (2007:528), and for such internal control
that the Board of Directors and the Managing Director determine is necessary
to prepare the ESEF report without material misstatements, whether due to
fraud or error.
Auditor’s responsibility
Our responsibility is to obtain reasonable assurance whether the ESEF report is
in all material respects prepared in a format that meets the requirements of
Chapter 16, Section 4(a) of the Swedish Securities Market Act (2007:528),
based on the procedures performed.
RevR 18 requires us to plan and execute procedures to achieve reasonable
assurance that the ESEF report is prepared in a format that meets these
requirements.
Reasonable assurance is a high level of assurance, but it is not a guarantee
that an engagement carried out according to RevR 18 and generally accepted
auditing standards in Sweden will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in aggregate, they could reasonably be expected to
inuence the economic decisions of users taken on the basis of the ESEF report.
The audit rm applies ISQC 1 Quality Control for Firms that Perform Audits
and Reviews of Financial Statements, and other Assurance and Related Ser-
vices Engagements and accordingly maintains a comprehensive system of
quality control, including documented policies and procedures regarding
compliance with professional ethical requirements, professional standards
and legal and regulatory requirements.
The examination involves obtaining evidence, through various procedures,
that the ESEF report has been prepared in a format that enables uniform elec-
tronic reporting of the annual and consolidated accounts. The procedures
selected depend on the auditor’s judgment, including the assessment of the
risks of material misstatement in the report, whether due to fraud or error. In
carrying out this risk assessment, and in order to design audit procedures that
are appropriate in the circumstances, the auditor considers those elements of
internal control that are relevant to the preparation of the ESEF report by the
Board of Directors and the Managing Director, but not for the purpose of
expressing an opinion on the eectiveness of those internal controls. The
examination also includes an evaluation of the appropriateness and reason-
ableness of assumptions made by the Board of Directors and the Managing
Director.
The procedures mainly include a technical validation of the ESEF report, i.e.
if the le containing the ESEF report meets the technical specication set out in
the Commission’s Delegated Regulation (EU) 2019/815 and a reconciliation of
the ESEF report with the audited annual accounts and consolidated accounts.
Furthermore, the procedures also include an assessment of whether the
ESEF report has been marked with iXBRL which enables a fair and complete
machine-readable version of the consolidated statement of nancial perfor-
mance, nancial position, changes in equity and cash ow.
The auditor’s examination of the corporate governance statement
The Board of Directors is responsible for that the corporate governance
statement on pages 51–60 has been prepared in accordance with the Annual
Accounts Act.
Our examination of the corporate governance statement is conducted in
accordance with FARs standard RevR 16 The auditor´s examination of the
corporate governance statement. This means that our examination of the cor-
porate governance statement is dierent and substantially less in scope than
an audit conducted in accordance with International Standards on Auditing
and generally accepted auditing standards in Sweden. We believe that the
examination has provided us with sucient basis for our opinions.
A corporate governance statement has been prepared. Disclosures in
accordance with chapter 6 section 6 the second paragraph points 2–6 of the
Annual Accounts Act and chapter 7 section 31 the second paragraph the
same law are consistent with the other parts of the annual accounts and
consolidated accounts and are in accordance with the Annual Accounts Act.
Ernst & Young AB with Erik Sandström as auditor in charge, Box 7850, 103 99
Stockholm, was appointed auditor of Atlas Copco AB by the general meeting
of the shareholders on April 26, 2022 and has been the company’s auditor
since the April 23, 2020.
Stockholm, March 20, 2023
Ernst & Young AB
Erik Sandström
Authorized Public Accountant
Atlas Copco 2022 124
AUDIT REPORT
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
• Audit Report
Financial denitions
Sustainability notes
Four years in summary
Contacts
Financial denition s *
Reference is made in the Annual Report to a number of nancial performance measures which are not dened according to IFRS. These
performance measures provide complementary information and are used to help investors as well as Group Management analyze the
company’s operations and facilitate an evaluation of the performance. Since not all companies calculate nancial performance measures
in the same manner, these are not always comparable with measures used by other companies. These nancial performance measures
should therefore not be regarded as a replacement for measures as dened according to IFRS.
Adjusted operating prot
Operating prot (earnings before interest and tax),
excluding items aecting comparability.
Adjusted operating prot margin
Operating prot margin excl. items aecting
comparability.
Average number of shares outstanding
The weighted average number of shares outstanding
before or after dilution. Shares held by Atlas Copco are
not included in the number of shares outstanding. The
dilutive eects arise from the stock options that are
settled in shares or that at the employees’ choice can be
settled in shares or cash in the share based incentive
programs. The stock options have a dilutive eect when
the average share price during the period exceeds the
exercise price of the options.
Capital employed
Average total assets less non-interest-bearing liabilities/
provisions. Capital employed for the business areas
excludes cash, tax liabilities and tax receivables.
Capital employed turnover ratio
Revenues divided by average capital employed.
Capital turnover ratio
Revenues divided by average total assets.
Debt/equity ratio
Net indebtedness in relation to equity, including
non-controlling interests.
Dividend yield
Dividend divided by the average share price quoted
of the A-share.
Earnings per share
Prot for the period attributable to owners of the parent
divided by the average number of shares outstanding.
EBITA – Earnings before Interest, Taxes, and
Amortization
Operating prot plus amortization and impairment of
intangibles related to acquisitions.
EBITA margin
EBITA as a percentage of revenues.
EBITDA – Earnings Before Interest, Taxes,
Depreciation and Amortization
Operating prot plus depreciation, amortization and
impairment.
EBITDA margin
EBITDA as a percentage of revenues.
Equity/assets ratio
Equity including non-controlling interests, as a
percentage of total assets.
Equity per share
Equity including non-controlling interests divided by
the average number of shares outstanding.
Items aecting comparability
Restructuring costs, capital gains/losses, impairments,
changes in provision for share-related long-term incen-
tive program and other items with the character of
aecting comparability.
Net cash ow
Change in cash and cash equivalents excluding currency
exchange rate eects.
Net debt/EBITDA ratio
Net indebtedness in relation to EBITDA.
Net indebtedness/net cash position
Borrowings plus post-employment benets minus cash
and cash equivalents and other current nancial assets,
adjusted for the fair value of interest rate swaps.
Net interest expense
Interest expense less interest income.
Operating cash ow
Cash ow from operations and cash ow from invest-
ments, excluding company acquisitions/divestments
and currency hedges of loans.
Operating cash surplus
Operating prot adding back depreciation,
amortization and impairments as well as capital gains/
losses and other non-cash items.
Operating prot
Revenues less all costs related to operations, but
excluding net nancial items and income tax expense.
Operating prot margin
Operating prot as a percentage of revenues.
Organic growth
Sales growth that excludes translation eects
from exchange rate dierences, and acquisitions/
divestments.
Prot margin
Prot before tax as a percentage of revenues.
Return on capital employed (ROCE)
Prot before tax plus interest paid and foreign exchange
dierences (for business areas: operating prot) as a
percentage of capital employed.
Return on equity
Prot for the period, attributable to owners of the
parent as a percentage of average equity, excluding
non-controlling interests.
Total return to shareholders
Share price performance including reinvested
dividends and share redemptions.
Weighted average cost of capital (WACC)
interest-bearing liabilities x i
+ market capitalization x r
interest-bearing liabilities
+ market capitalization
i: An estimated average risk-free interest rate
of 4% plus a premium of 0.5%.
An estimated standard tax rate has been applied.
r: An estimated average risk-free interest rate of
4% plus an equity risk premium of 5%.
* Atlas Copco has chosen to present the company’s alternative performance measures in accordance with the guidance by the European Securities and Markets Authority (ESMA) in a separate appendix.
The appendix is published on www.atlascopcogroup.com/en/investor-relations/key-gures/nancial-denitions
Atlas Copco 2022 125
FINANCIAL DEFINITIONS
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
• Financial denitions
Sustainability notes
Four years in summary
Contacts
Sustainability notes
Atlas Copco’s sustainability report aims to provide stakeholders with relevant information about the Group’s economic,
environmental and social impact. The sustainability notes include complementary information about our materiality
assessment, stakeholder dialogue, governance, performance data and reporting principles.
Stakeholder dialogue
As a global Group, it is vital for Atlas Copco to ensure accountability for our actual and potential impact on the economy,
environment and people. Engaging continually and systematically with key stakeholders helps us understand, prioritize
and manage the impacts of our organization as well as the impacts along our value chain. The engagement is also crucial
to proactively identify stakeholders’ concerns and expectations.
Our methods of engagement with key stakeholder groups and the issues and concerns raised by them are presented
in the table below. Read more about our risks and impacts along the value chain on page 128.
Stakeholder group Key issues and concerns Method of engagement
Customers
• Product safety
• Product innovation
• Product carbon impact
• Product resource-efficiency
and circularity
• Customer visits
• Surveys and interviews
• Customer events
• Website
Investors,
analysts,
shareholders
• Growth and profitability
• Risk management
• Climate and environmental impact
• Business ethics
• Gender balance
• Investor interaction
• Capital market days
• Annual general meeting
• Website
• Financial reports and presentations
Employees
• Health and safety
• Diversity and inclusion
• Working conditions
• Competence development
• Compensation and benefits
• Yearly appraisal
• Employee surveys
• Work councils
• Employee representatives
on the Board
Society
• Climate and environmental impact
• Social and environmental compliance
• Human rights
• Labor market issues
• Memberships in international
collaborations and industry initiatives
• Local engagement
• Website
• Surveys and interviews
Business partners
• Occupational health and safety
• Labor conditions
• Human rights
• Business ethics
• Climate and environmental impact
• Collaborations with suppliers
• On-site evaluation and supplier audits
• Surveys and interviews
Stakeholder dialogue 126
Materiality assessment and material sustainability issues 127
Sustainability impact and risks along the value chain 128
Sustainability governance 129
Human rights assessment 129
External initiatives and membership of associations 129
Economic performance 130
Anti-corruption 130
Environmental management systems 130
Energy consumption 130
Environmental compliance 130
Climate-related risks and opportunities 131
Value chain impact assessment 131
Employment 132
Occupational health and safety 132
Diversity and inclusion 132
Taxes 133
Responsibility throughout the value chain 133
Product responsibility 134
EU Taxonomy regulation disclosures 135
About the sustainability report 138
GRI content index 139
SASB index 143
Sustainability performance 144
Auditor’s Limited Assurance Report on Atlas Copco AB’s Sustainability Report
and statement regarding the Statutory Sustainability Report 146
CONTENTS
Atlas Copco 2022 126
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
Value creators
These are topics that are central to long-
term value creation. Managing these
issues help position Atlas Copco as a
leader within sustainability. Our ambi-
tions are expressed through our targets.
Trust builders
Working with these topics help build
trust in Atlas Copco’s business. Our
ambition is to be transparent and to keep
pace with stakeholder expectations.
Strategic enablers
These are topics that play a central role
to deliver on Atlas Copco’s business
strategy. Working with them should
build and ensure business resilience.
Topics
– Business ethics and integrity
– Occupational health,
safety & wellbeing
– Product quality and service
– Life-cycle approach to product
development
– Product carbon impact
Topics
– Energy use and efficiency
– Human rights
– Responsible value chain
– Data protection and privacy
– Climate impact along the value chain
Topics
– Diversity and inclusion
– Talent development and retention
– Gender balance in leadership positions
– Circular business models
Materiality assessment
A materiality assessment is conducted regularly to identify sustain-
ability risks and opportunities as well as to define the Group’s most
significant impact from a perspective of economic impacts, the envi-
ronment and society, including human rights.
In this process, the perspectives of key stakeholders are gained
through surveys and interviews where they are asked to prioritize a
set of pre-defined issues where Atlas Copco has actual or potential
impact on society and the environment through our operations and
business relationships. The stakeholders also help identify sustain-
ability risks and opportunities that may affect Atlas Copco’s long-
term value creation and business performance.
The outcome of the materiality assessment is discussed in internal
workshops involving a broad representation of experts and func-
tions, including the specialist safety, health, environment and quality
function. It is also reviewed by Group Management and the Board.
Atlas Copco uses the materiality assessment, together with the UN
Global Compact’s principles, the UN Sustainable Development Goals,
and risk and opportunity assessments, in reviewing our sustainability
ambitions and focus areas. It also forms the basis of the sustainability
targets that apply from 2022 forward, as presented on page 6.
Material sustainability issues
Atlas Copco’s most recent materiality assessment was conducted in
2021. In relation to the previous materiality analysis, some issues were
deemed to have become more material and a few less material. For
example, stakeholders placed increased focus on diversity and inclu-
sion, talent development and retention, and gender balance in lead-
ership positions. Stakeholders also gave higher priority to issues relat-
ing to climate change, such as carbon impact, circular business mod-
els, and a life-cycle approach to product development. Water use,
community engagement and taxes were identified as somewhat less
material.
See below the sustainability issues that were identified as most
material in the 2021 materiality assessment. They have been catego-
rized as topics that are central to our long-term value creation, to
building trust in Atlas Copco and our business, and topics that are
central in delivering on our strategy and building business resilience.
More information and details on how the materiality assessment
was conducted, including a materiality matrix, are available on the
Group’s website, www.atlascopcogroup.com.
Atlas Copco 2022 127
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
Business partners Our own operations Customers
Impact
Atlas Copco has a large supplier base and purchased compo-
nents account for about 75% of the product cost. The choice
of suppliers is therefore of great importance for our impact
from a social and environmental perspective. The collabora-
tion with business partners and the business partner require-
ments aim to protect Atlas Copco from risks and promote
better standards in society.
Atlas Copco’s operations is global with employees and man-
ufacturing in a large number of countries. In some of these,
there is a high risk of human rights violations, corruption, and
non-compliance with laws and Atlas Copco’s policies. The
impact of our own operations relates mainly to the manufac-
turing and transport of products, and employees’ working
conditions, including their health and safety.
Atlas Copco’s customers demand innovative,
high-quality products that are resource and
energy efficient, safe and ergonomic. The main
part of the products’ climate impact occurs
when they are being used.
Risks
– Business partners who do not live up to human rights
standards, such as decent working conditions and the
freedom of association
– Business partners who do not live up to the principles
of ethical business, for example regarding corruption
– Purchased components that are not produced in a
sustainable way, e.g. the presence of conict minerals, or
components with a large carbon footprint
– Climate- or environmental-related events causing
disruptions in the supply or distribution chain
– Insucient standards regarding safety and health
– Lack of access to skilled and competent employees
– Human rights violations, such as discrimination and
restrictions on freedom of association
– Unethical behavior or corruption
– Manufacturing and transport of products lead to
greenhouse gas emissions
– Environmental impact from waste and emissions
– Climate- or environmental-related events causing
disruptions in operations or manufacturing
– Customers´ impact on the environment, the
climate, human rights or other social aspects
– Risks of sanctions
– Risks of corruption
Mitigating
activities
– Risk-based assessment of business partners, including
quality and social/environmental responsibility aspects
– Requirement that signicant direct suppliers must have an
approved environmental management system
– Requirement that signicant business partners must
sign and follow the Code of Conduct
– Action plans developed together with the supplier to deal
with any shortcomings and deviations
– Employee training in the Code of Conduct, and a system
for reporting violations
– Safety, health and environmental training for business
partners
– Global network of sub-suppliers reducing the
dependence on individual suppliers
– Promoting international frameworks, such as UN Global
Compact
– Technology development in collaboration with business
partners
– Adopting Science-Based Targets for the reduction of
greenhouse-gas emissions (scope 3), including action plans
by each business area for how to contribute to the targets.
– Regular assessment of sustainability risks, including
climate-related risks
– Targeted recruiting and competence development
– Certication of major operating units according to
ISO 9001, ISO 14001 and ISO 45001
– Training for all employees in the Code of Conduct,
and a system for reporting violations
– Follow-up and control through internal audits
– Safety and health trainings for employees
– Increased use of renewal energy and eorts to decrease
energy consumption
– Eorts to decrease waste volumes and to increase the share
of reused and recycled waste
– Eorts to reduce water consumption
– Reduced use of air freight in favor of lower carbon transport
modes
– Applying international standards and frameworks, such as
the UN Global Compact
– Adopting Science-Based Targets for the reduction of green-
house-gas emissions (scope 1 and 2), including action plans
by each business area for how to contribute to the targets.
– Continuous development of products
with improved ergonomics, safety, energy
eciency and reduced emissions
– Employee training in the Code of Conduct,
and a system for reporting violations
– Evaluation of customers’ sustainability work
and dialogue with customers in complex
markets
– Collaborations with customers to develop
ecient and safe solutions with reduced
environmental impact
– Adopting Science-Based Targets for the
reduction of greenhouse-gas emissions
(scope 3), including action plans by each busi-
ness area for how to contribute to the targets.
Sustainability impact and risks along the value chain
Understanding our sustainability impact and risks throughout the value chain helps us choose the right actions to handle them.
The table below shows where our impacts occur, the corresponding risks and examples of how we work to minimize them.
Read more about our climate-related risks and how we manage them on page 131.
Atlas Copco 2022 128
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
Sustainability governance
The Board of Directors has the overarching responsibility for overseeing Atlas
Copco’s strategic direction, including the Group’s financial and non-financial
strategies and targets to ensure a sustainable, profitable growth. The Board
approves Atlas Copco’s sustainability focus areas, and the related targets. The
Group’s performance in relation to the targets is reported quarterly to the
Board by the CEO. The Board is the owner of the Group’s Code of Conduct
which regulates how employees, and the Board itself, should act towards each
other and in relation to other stakeholders. The Board is also, together with
Group Management, responsible for the preparation, reviewal and approval
of the sustainability report, including the material topics.
Each member of Group Management is responsible for the implementation
and follow-up of strategies and targets although the CEO has the ultimate
responsibility. Progress in relation to the targets is part of the variable compen-
sation for members of Group Management as well as for other employees.
The Vice President Sustainability is responsible for coordinating the Group’s
sustainability work and reports to the SVP Chief Communications Officer, who
is a member of Group Management.
Implementation is handled mainly by the divisions, which are separate
operational units, responsible for delivering results in line with the business
area’s strategies and targets. The business areas and divisions set quantified
targets for delivering on the Group targets. The divisional presidents and gen-
eral managers are responsible for ensuring that targets are set as a part of the
three-year plan, and that progress is followed-up and reported to the Group.
Safety, Health, Environment and Quality (SHEQ) managers support the sus-
tainability work in the operational entities, divisions and business areas. At
corporate level, a sustainability team and controller provide coordination and
support to the entire organization, working closely with a SHEQ representative
from each business area. The Group’s SHEQ council is chaired by a division
president and consists of the business area SHEQ managers, the Vice President
Sustainability, and representatives for HR, Holding and controlling. The SHEQ
council comes together quarterly to discuss actions, policies and guidelines to
support the organization in reaching set ambitions.
Central policies and guidelines
Atlas Copco’s Code of Conduct is the central guiding policy which sets clear
requirements to ensure that we conduct business with the highest ethical
standards and that we act with integrity, fairness and respect in all operations.
All employees, business partners, and the Board of Directors are expected to
adhere to the principles in the Code. In cases where the Code of Conduct is
stronger than local laws and regulations, the Code should apply.
The Code of Conduct is based on the following international standards:
• United Nations International Bill of Human Rights
• The ILO Declaration on Fundamental Principles and Rights at Work
• The United Nations Global Compact
• The OECD Guidelines for Multinational Enterprises
• UN Guiding Principles for Business and Human Rights
The Board of Directors owns the Code of Conduct and reviews it each year. In
2022, the content of the Code of Conduct was updated with new topics includ-
ing modern slavery, risk management, circularity, data protection and privacy.
Atlas Copco’s Code of Conduct is supported and complemented by other
Group policies and guidelines, such as:
• SHEQ policy: global Safety, Health, Environment and Quality policy that
ensures robust standards for safety and wellbeing, as well as an environ-
mental and quality perspective on technologies, products and services to
make sure these contribute to a sustainable productivity for customers.
• Human Rights Statement: expands on the Group’s commitment to respect
and support human rights and defines procedures to ensure compliance
throughout Atlas Copco’s operations.
• Business partner criteria: significant business partners must commit to
following Atlas Copco’s Code of Conduct by signing the Business partner
criteria which states the Group’s expectations regarding business ethics,
social, safety, health and environmental performance.
• The Enterprise Risk Management process, which is conducted annually on
divisional level, and includes sustainability-related risks. The results are
aggregated on business area and Group level.
All employees are required to complete a leader-led ethics training every two
years and to annually sign a Code of Conduct compliance statement. The Code
of Conduct has been translated into more than 30 languages and is available
on the Group’s website.
Management system standards
Atlas Copco strives for all major operating units to be triple-certified according
to the standards ISO 9001 (quality management), ISO 14001 (environmental
management) and ISO 45001 (occupational health and safety). All production
units with more than 20 employees, and all customer centers and rental com-
panies with more than 70 employees are to be triple-certified. By the end of
2022, the share of required units that were not triple-certified was 10% of the
total number of operational units. The same measure for each individual certifi-
cation was 6% for ISO 9001, 9% for ISO 14001 and 9% for ISO 45001. Some of
the non-certified units are acquisitions still within the two-year timeframe to
comply, or newly restructured units. Some units which are not yet triple-
certified are in the process of becoming so, and a smaller portion has lacked
the resources so far to commit to a triple certification.
Grievance mechanism
The Group promotes a culture of integrity through mutual respect, trust, and
high ethical standards in all business interactions. Atlas Copco uses an external
whistleblowing system called SpeakUp. The system may be used by employees
or external stakeholders to report behavior or actions that are, or may be per-
ceived as, violations of laws or the Code of Conduct. It is accessible all day, every
day, offering anonymous reporting in more than 70 languages via a message
function or local phone number. The Group’s legal department handles cases,
initiates investigations and the SVP Chief Legal Officer informs the Board regu-
larly about critical concerns (see number of reported cases on page 130).
Human rights assessment
Atlas Copco is a signatory of the UN Global Compact and committed to work-
ing with the ten universally accepted principles in the areas of human rights,
labor, environment and anti-corruption. The Code of Conduct also supports
the International Labour Organization Declaration on Fundamental Principles
and Rights at Work, as well as the OECD’s Guidelines for Multinational
Enterprises.
The Group committed to the UN Guiding Principles for Business and Human
Rights when it was launched in 2011. In accordance with the requirements,
Atlas Copco has an ongoing process to identify, prevent, mitigate and account
for the human rights impacts related to Atlas Copco’s business and business
relations.
The Group strives to work according to the UN Guiding Principles across the
value chain, covering procurement, human resources, sales, marketing and
other business processes. The Group’s commitment covers all individuals and
stakeholders who may be impacted by our activities or business relationships.
Human rights are monitored by the Compliance Board, which has two mem-
bers of Group Management: the SVP Chief Legal Officer and the SVP Chief
Communications Officer. The Compliance Board addresses training needs,
impact assessment and the action points related to the implementation of the
UN Guiding Principles.
Human rights due diligence is carried out when deemed relevant for spe-
cific markets, for instance when Atlas Copco enters a market that is perceived
as presenting severe human rights risks. Atlas Copco’s whistleblowing system
can be used to anonymously report perceived human rights violations.
Atlas Copco’s human rights statement can be found at the Group’s website
www.atlascopcogroup.com.
Training on human rights policies and procedures
Atlas Copco has developed human rights specific training in addition to train-
ing in the Code of Conduct to increase employee awareness. The training is
available to all employees through the Group’s intranet.
External initiatives and membership of associations
Atlas Copco is a signatory to the UN Global Compact, a strategic policy initia-
tive for businesses that are committed to aligning their operations and strate-
gies with ten universally accepted principles in the areas of human rights,
labor, environment and anti-corruption.
Atlas Copco is also active in a number of international organizations and
industry collaborations and initiatives, such as:
• The Stockholm Chamber of Commerce
• The International Council of Swedish Industry
• The Association of Swedish Engineering Industries
• Transparency International Sweden
• Pneurop – European Association of Manufacturers of Compressors, Vacuum
Pumps, Pneumatic Tools and Air & Condensate Treatment Equipment
• The Responsible Minerals Initiative
While the general objectives of these organizations are in line with Atlas
Copco’s interests, there may be differences of opinion regarding specific
issues. The memberships do not indicate that Atlas Copco endorses all actions
or policy statements made by the respective organization.
Atlas Copco 2022 129
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
ECONOMIC IMPACT
Economic performance
Direct economic value generated and distributed
Atlas Copco creates employment and financial stability through subcontract-
ing manufacturing and other activities. The Group’s shareholders and credi-
tors provide funds to finance the asset base that is used to create economic
value. In return, these stakeholders receive dividend and interest.
Atlas Copco contributes to economic development within the regions
where we operate, through payments to pension funds and social security,
and payment of taxes, social costs and other duties. Community investments
amounted to MSEK 28 (31).
Local purchasing (non-core) is encouraged in order to generate societal
value in the communities where Atlas Copco operates, by creating job oppor-
tunities as well as generating direct and indirect income. This is mostly carried
out by local companies, which also decreases the environmental impact from
transport.
Economic value 2022 2021
Direct economic value 142 233 111 972
Revenues 141 325 110 912
Economic value distributed
Operating costs 78 094 61 019
Employee wages and benets, including other
social costs
33 580 27 151
Costs for providers of capital 9 765 9 281
Costs for direct taxes to governments 7 262 5 372
Economic value retained 13 532 9 149
– Redemption of shares 9 732 –
Anti-corruption
Atlas Copco has zero tolerance against corruption. The Code of Conduct is the
Group’s central policy document, accessible to all employees. All employees
are required to sign the compliance statement for adherence to the Code of
Conduct, and participate in trainings. Division presidents have the ultimate
responsibility for the adherence to the Group’s values and policies. Internal
control is exercised through distribution of responsibility and internal audits.
The Compliance Board oversees compliance with the Code of Conduct.
Atlas Copco conducts internal audits of all operational entities using a risk-
based approach. Each entity is normally audited at least every five years. All
internal audits include an ethical review and an audit of risks related to corrup-
tion. In 2022, 99 entities (19% of all entities) were audited and no significant
risks related to corruption were identified during these audits.
Reported potential violations, number 2022
Fraud 13
Labor relations, including discrimination and harassment 245
Corruption & regulatory breach 28
Conicts of interest 7
Other 70
Total 363
During the year, there were a total of 363 reported potential violations
through Atlas Copco´s whistleblowing solution, SpeakUp. In 45 cases no evi-
dence of wrongdoing was found, in 51 cases evidence could confirm that no
wrongdoing had occurred, in 5 cases disciplinary action, such as a written
warning, were taken against one or several employees as a result of an investi-
gation. In 30 cases weaknesses were found in internal processes which were
improved as a result. Two cases were settled in court. The remaining cases are
under active investigation.
There were no significant fines or non-monetary sanctions for non-
competitive behavior or for non-compliance with laws and/or regulations
in the social and economic area during the year.
ENVIRONMENTAL IMPACT
Atlas Copco has integrated the most material environmental KPIs into its
strategic work. This drives improvement and efficiency, while reducing our
impact on the environment.
Environmental performance is monitored and reported at unit level and
aggregated to Group level. General managers are responsible for overseeing
the implementation of divisional strategies and targets, including undertaking
initiatives to increase the proportion of reused, recycled or recovered waste,
reduce water consumption, to curb energy use and emissions as well as
increase the proportion of renewable energy used.
Environmental management systems
To minimize the environmental impact and to secure that the precautionary
approach is applied, Atlas Copco has the ambition to implement environmen-
tal management systems (EMS) in all operations. All production units with
more than 20 employees should be certified according to ISO 14001. Acquired
product companies are normally certified within a two-year period.
The share of significant direct suppliers with an approved EMS is also
measured, and the target is that the share should increase year-by-year. An
approved EMS is defined as ISO 14001, or fulfilled EMAS (EU Eco-Management
and Audit Scheme) requirements. The significant supplier needs to be third-
party certified for ISO 14001 or registered in accordance with EMAS and hold a
valid certificate/registration. In 2022, 31% of the Group’s significant direct
suppliers had an approved environmental management system according to
this definition.
Energy consumption within the organization, all operations
Energy consumption*, MWh 2022
Direct energy, renewable 7 008
Direct energy, non-renewable 152 228
Indirect energy, renewable (incl. renewable of mix) 293 578
Indirect energy, non-renewable 65 092
* The calculation of indirect energy, i.e. energy purchased externally by the company,
includes electricity (95%) and district heating (5%) used at the sites. Atlas Copco does not
report cooling or steam separately. The calculation of direct energy, i.e. energy generat-
ed by the company for its own production or operation, comprises all fuels used on the
sites, including diesel, oil, bio-fuel, gasoline, solar, geothermal, propane and natural gas.
Environmental compliance
Atlas Copco follows applicable environmental laws in all countries where the
Group operates. Incidents or fines are reported for non-compliance with envi-
ronmental legislation, as well as incidents involving chemical, oil or fuel spill-
ages. In 2022, there was 1 (0) accident resulting in adverse environmental
effects, related to an antifreeze spill at a production unit in the US. The Group’s
total clean-up costs relating to adverse environmental effects amounted to
KSEK 379 (0). Monetary sanctions for non-compliance in the Group amounted
to KSEK 171 (0).
Two Swedish operations, involving machining and assembly of compo-
nents, require permits based on Swedish environmental regulations. The per-
mits relate to areas such as use of cutting fluids, process oils and hydraulic oils,
emissions to water and air, and noise pollution. None of the permits were
under revision in 2022.
Atlas Copco 2022 130
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
There are a growing number of voluntary reporting
standards, initiatives and regulations concerning
climate, such as the Taskforce on Climate-related
Financial Disclosures (TCFD). Atlas Copco takes
inspiration from the guidelines and seeks to
develop our reporting continuously and address
major areas of information sought.
Governance
The Board of Directors is responsible for Atlas
Copco’s overall strategy, organization, administra-
tion and management. This includes climate-
related risks and opportunities. The Board of Direc-
tors have approved the science-based targets that
were adopted by Atlas Copco in 2021 and against
which the Group’s climate-related work will be
measured from 2022 onwards. Climate-related
issues concern several functions and areas of
expertise in the organization. At an operational
level, risks and opportunities are governed by
Group Management and the divisional presidents.
Read more about corporate governance on pages
51–54.
Strategy
Atlas Copco assesses climate-related risks and
opportunities that have an actual and potential
impact on our business and strategy. The process
for identification of risks and opportunities is cen-
tered at the divisions. The Group has identified and
assessed the following market, regulatory and
physical risks related to climate change:
• Market risks
Market shifts toward a low-carbon economy
may impact the viability of certain sectors and
products. Atlas Copco’s continuous work to
increase the energy efficiency of our products
helps mitigate these risks. This shift also rep-
resents an opportunity to continue developing
more energy-efficient products and may give
rise to new businesses and business models. For
instance, an increased generation of renewable
energy, such as solar panels and wind mills, and
the surge in production of electrical vehicles,
present opportunities since Atlas Copco provides
products and services to these industries.
• Regulatory risks
Climate and energy policy will gradually be
sharpened and favor companies that deliver
energy-efficient products and comply with
sustainable practices. Among the risks are
increased energy prices and taxes, and regula-
tions related to CO
2
or other greenhouse-gas
emissions. As the Group invests in innovative
products via research and development, more
strict regulations will likely offer opportunities
for Atlas Copco.
• Physical risks
Changing weather patterns may pose a physical
risk to operational units or suppliers in areas in
risk of rising sea levels, water scarcity or violent
storms that could result in disruptions in the
production or logistics chain. The physical risk is
assessed at site level and safety measures are
taken if needed, as part of the loss prevention
program. Atlas Copco has a global network of
suppliers, which provides resilience to local or
regional disruptions.
Risk management
Climate-related risks, such as physical risks for
operational entities or market risks connected to
products, and the related financial implications are
assessed at the divisional level and, when deemed
relevant, included in the annual Enterprise Risk
Management process. An aggregated analysis of
the identified risks is presented annually to Group
Management. Read more about the risk manage-
ment process on page 44.
Metrics and targets
Since 2021, Atlas Copco implements science-based
targets covering the entire value-chain. Our
greenhouse gas emission reduction targets are
approved by the Science-based Target initiative as
being aligned with the Paris Agreement.
Read more about the targets and the progress
made on pages 34–35, 42, 130 and 144.
CLIMATE-RELATED RISKS AND OPPORTUNITIES
Value chain impact assessment
In 2021, Atlas Copco conducted a value-chain impact
assessment, which formed the baseline for our Science-
Based targets and the starting point for our commitment
to reduce the Group’s carbon dioxide equivalent emis-
sions in line with the Paris agreement. A common Group
methodology was used with 2019 as the baseline year.
The direct climate impact from energy used by our
entities (scope 1 and 2) was initially calculated by using
actual data from the reporting entities and estimating
the impact from remaining entities. In 2022, all entities
have reported their actual carbon dioxide equivalent
emissions from energy used in companies, and vehicles’
use. The performance on scope 1 and 2 is monitored and
reported at unit level and aggregated to Group level.
To calculate the product-related value chain impact, as
part of the scope 3 emissions, a Group-common tool has
been developed – The Product Carbon Footprint tool
(PCF). The tool is updated yearly and covers the material
used in the product, the estimated service required,
energy used at the production site as well as during the
use phase based on an estimation of how the products
are used by our customers.
Considering the different characteristics of our prod-
ucts, the business areas’ plans and efforts to reduce the
climate-impact of their products differ. However, they all
have in common that the development and availability of
renewable energy sources in customers’ markets will be
critical to their ability to achieve the Group’s targets for
scope 3 emissions.
Business area Calculation method Efforts to reduce products‘ climate impact
Compressor
Technique
Scope 3 emissions have been calculated by
applying the PCF tool to a set of reference
products selected by the business area.
The scope 3 target will be achieved by
improving the efficiency of our products and
optimizing the compressor room by improved
controls and variable speed.
Vacuum
Technique
Scope 3 emissions have been calculated by
applying the PCF tool methodology to the
products sold to global markets. Estimations
have been made regarding the electricity
consumption by applying a standard load
factor. Other aspects through the lifecycle
of the products have been standardized
including the lifecycle itself.
The scope 3 target will be achieved by
improving product performance, integrating
smart technology to optimize the energy
required, and by leveraging our service teams
to deploy product upgrades, which will extend
product lifecycles.
Power
Technique
Scope 3 emissions for the years 2019–2022
have been calculated manually based on a
set of reference products selected by the
business area. The emissions for 2022 have
been extrapolated based on the previous
year’s result and increase in cost of goods
sold. A factor for reduction based on
identified levers and their potential to
reduce emissions has also been used.
The scope 3 target will be achieved by
providing electrified alternatives for each
product, improving fuel efficiency of the
internal combustion engines, and stimulating
customers’ and rental customers’ use of HVO
by offering solutions to make HVO available
on the construction sites.
Industrial
Technique
Scope 3 emissions have been calculated by
applying the PCF tool to a set of reference
products selected by the business area.
The scope 3 target will be achieved by
developing and providing electric alternatives
for the pneumatic product ranges, improving
energy efficiency in the current product
range and optimizing use of the products
by customers.
Our ambition is that the data we report should be as real-
istic as possible to reflect the products’ actual emissions.
However, due to the complexity of the area and the num-
ber of assumptions and estimates underlying the calcula-
tions, we realize that the data is associated with signifi-
cant uncertainties. We will therefore work gradually to
develop and improve the quantification processes and
tools we use over time, to increase their accuracy as far as
practicable and minimize uncertainties.
Atlas Copco 2022 131
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
SOCIAL IMPACT
Employment
Information on employees and other workers
Atlas Copco is a significant employer on the global market. The Group reports
the number of employees as full time equivalents (FTE) per geographical
spread and per professional category, as well as divided between white-collar
and blue-collar employees. For geographical spread of Atlas Copco employees
and employees by professional category, see note 5, page 83.
Additional workforce by region, at year end, % 2022
North America 16
South America 1
Europe 47
Africa/Middle East 1
Asia/Oceania 35
Total 100
Additional workforce by professional category, at year end, %
2022
Production 52
Marketing 2
Service 15
Administration 14
Research & development 17
Total 100
New employee hires and employee turnover
The total number and rate of external new employee hires in 2022 was 8 524
(6 524) which constitutes 18.6% (15.8) of the total average number of employ-
ees during the year. The percentage of externally recruited female employees
was 27% (27). The total number of resignations was 3 667 (2 833), which con-
stitutes 8.0% (6.9) of the total average number of employees during the year.
The Group’s KPIs for employee satisfaction and engagement measure how
employees perceive the company culture and their opportunities to grow in
the company. The targets for both KPIs are to be above and to continuously
increase in relation to the employee engagement survey provider’s propri-
etary benchmark for global companies. The benchmark is based on ano-
nymized data from the survey provider’s customer base with tens of millions
of respondents in more than 150 countries, as well as input from industry
panel studies to produce robust and unbiased normative data.
Freedom of association and collective bargaining
Atlas Copco views trade unions and employee representatives as a valuable
support for its employees, and fosters relationships based on mutual respect
and constructive dialogue. Labor practices and employee rights, such as col-
lective bargaining, are covered in the Code of Conduct. In 2022, 29% (32) of
all employees were covered by collective bargaining agreements.
As a decentralized organization, the engagement and dialogue with labor
unions take place at a local level. In case of operational changes that may
significantly affect employees or result in giving notice, the local laws and
regulations as well as collective bargaining agreements are respected and
complied to. The need for transition assistance programs is assessed at local
level and the support provided through such programs are adapted to the
situation at hand and to local market conditions. The Group’s internal job
market is available to all employees and provides opportunities for internal
mobility.
In countries where no independent labor unions exist, Atlas Copco has
taken measures to establish forums for employer/employee relations,
through environment and safety committees.
Labor relations are followed up regularly on the operational level and
reviewed by internal audit. Significant suppliers’ compliance to our Code of
Conduct, which is based on international guidelines and frameworks such as
the UN Global Compact and the International Labour Organization Declara-
tion on Fundamental Principles and Rights at Work, is audited regularly.
Occupational health and safety
Safety and wellbeing are key priorities for Atlas Copco due to the importance
of a sound working environment to employees’ health and motivation, as
well as to the Group’s productivity and competitiveness. The Group’s global
Safety, Health and Environmental policy ensures that there are robust stan-
dards for safety and wellbeing in the workplace.
Each division sets targets and makes action plans to increase awareness
and improve behavior, policies and processes with the purpose of offering a
safe and healthy work environment and to identify and address risks. Targets
and key performance indicators on safety and wellbeing are continuously
monitored by local management and followed up by Group Management in
connection with the quarterly reporting of sustainability data.
Occupational health and safety management system
Group companies must have an Atlas Copco-verified Safety, Health, Environ-
ment, and Quality management system, which is documented, implemented
and updated on an ongoing basis. Customer companies and rental compa-
nies with more than 70 employees, and product companies with more than
20 employees shall be certified according to ISO 45001. The system involves
regular risk assessments and follow-up on conditions and safety-related
processes of both our own workplaces and those of contractors.
Employees covered by ISO 45001*, 2022 Number (FTE) %
Atlas Copco employees 32 754 86
Additional workforce 2 650 86
Total 35 404 86
* Based on units required by Atlas Copco to be certified according to ISO 45001. The
certificates are audited both internally and externally.
Work-related injuries
In order to decrease risks and prevent injuries in the workforce, Atlas Copco
uses a safety pyramid for the Group’s reporting. The method supports trans-
parent reporting, risk-averse behavior and behavior change. The definitions of
different severity of incidents and injuries are aligned with international stan-
dards. The number and rate of incidents and injuries cannot be compared with
the years before 2019, as this was the first year the reporting tool was used.
The Group’s safety-related target is to have a balanced safety pyramid. This
means more reports of risk observations than near misses, more near misses
than minor injuries, and more or equal reports of minor injuries relative to
recordable injuries.
See the results of the 2022 reporting in the table below and illustration
above. Over the last few years, the major hazards reported for high-conse-
quence injuries have been slips and trips, lone working and manual handling
of equipment. Examples of common injuries were cuts or other injuries from
operating machines. Among the actions to mitigate hazards are awareness
training and risk assessment of working environment, inspections, mechanical
handling aids, and ensuring safe access to equipment.
Total recordable injuries, 2022
Per million
working hours Number
Recordable injuries, total workforce 4.2 403
Recordable injuries, Atlas Copco employees 4.3 375
Recordable injuries, additional workforce 3.6 28
Fatalities, total workforce 0 0
Fatalities, Atlas Copco employees 0 0
Fatalities, additional workforce 0 0
High-consequence injuries, total workforce 0.04 4
High-consequence injuries, Atlas Copco
employees
0.05 4
High-consequence injuries, additional
workforce
0.0 0
Diversity and inclusion
Atlas Copco’s Diversity and Inclusion guideline states that we strive for diver-
sity and inclusion in every aspect of our operations. Atlas Copco believes in
having an inclusive culture, which means that all of our employees are treated
fairly and with respect, are able to make a professional career, are seen and
heard, and have the opportunity to thrive and grow. We provide equal oppor-
tunity to all applicants and employees and do not discriminate based on
ethnicity, religion, gender, age, nationality, disability, sexual orientation or
political opinion. The diversity and inclusion guideline covers all employees.
Atlas Copco companies establish local diversity policies and guidelines in align-
ment with the Group policy, local laws and regulations, and local ambitions.
Anti-harassment and non-discrimination are addressed in the Group’s manda-
tory ethics training.
Total recordable
injuries
Safety pyramid 2022
Total workforce,
number
Fatality
Work-related
fatality (0)
High-consequence
injury
Injury where recovery to
pre-injury tness takes longer
than six months (4)
Other recordable injury
Injury resulting in absence from work, restricted
work, medical treatment, loss of consciousness
or signicant injury diagnosed by a physician (399)
Minor injury
Minor injury requiring rst aid treatment only (1 261)
Near miss
Event that did not result in an injury but had the potential to do so (6 800)
Risk observations
Observations of unsafe conditions that could cause harm/injury (110 473)
Atlas Copco 2022 132
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
The Diversity and Inclusion Council is chaired by President and CEO Mats
Rahmström, and consists of representatives from all business areas, along with
the corporate communications, human resources and accounting and con-
trolling functions. The council meets regularly to follow up on action plans
and results in the operations.
Atlas Copco strives to increase the share of women in the organization, and
the target is that by 2030, there should be 30% women in the Group. At year
end 2022, the share of women in the workforce was 21.6% (20.9). The Board
of Directors (excluding worker representatives) constituted of 6 men and
2women (25% women) and Group Management were 7 men and 2 women
(22% women).
Atlas Copco has managers on international assignments coming from
46countries and working in 46. In 2022, a total of 80% (77%) of all senior
managers were locally employed. 46 (42) nationalities were represented
among the 631 (509) most senior managers in the Group.
Taxes
The Group recognizes the key role that tax plays in advancing economic devel-
opment and considers it vital to combat corruption and support sound busi-
ness practices in order to create most value for society. Atlas Copco believes in
good corporate practice in the area of tax management, balancing the inter-
ests of various stakeholders, including customers, investors as well as the gov-
ernments and communities in the countries in which the Group operates. Atlas
Copco does not engage in aggressive tax planning but instead takes care to
pay the correct taxes in its countries of operation. Atlas Copco’s tax policy can
be found at the Group’s website www.atlascopcogroup.com. See note 9 of
the consolidated financial statements for the details of taxes paid, reported
according to the international financial reporting standards.
Disclosing tax by country
Atlas Copco openly discloses the Group´s corporate income tax cost including
the Group effective corporate tax rate in the annual report. The Group reports
revenues, corporate tax costs and other key figures via country-by-country
reporting to tax authorities globally.
At present, there is no established international standard for publicly
reporting taxes paid by country and the resulting data is therefore not compa-
rable between different companies. Considering various initiatives on openly
disclosing corporate tax costs, including the EU Directive on public country- by-
country reporting, we expect corporate tax cost on regional or country level
to be disclosed for the Atlas Copco Group within the coming years.
Responsibility throughout the value chain
Working with business partners who share Atlas Copco’s high standards
regarding quality, business ethics, the environment and resource efficiency is
necessary to effectively manage risks, and to enhance productivity in the value
chain. The ambition is to work with suppliers and distributors who share these
standards and who comply with the Code of Conduct.
Business
partner Role in the value chain
Primary responsible for risk
management and compliance
Suppliers,
subcontractors
Provide key parts as well as
manufacturing services
Purchasing councils
Joint ventures
Partly owned companies
that provide complementary
products and services
Division presidents
Agents,
distributors
Sell and distribute
products to customers on
the Group’s behalf
Marketing councils
Suppliers
Atlas Copco has a large international supplier base. Around 75% of product
cost stems from purchased components. Atlas Copco’s purchasing strategies
are decentralized to give the organization higher flexibility and to ensure the
right competence. Purchasing councils oversee supply chain management at
divisional level, and come together as a part of the Group purchasing council to
develop central policies and tools that impact all operations. Local purchasing
is encouraged.
Geographical
spread of
suppliers
Asia/Oceania 41%
North America 12%
Europe 44
%S
outh America 3%
Evaluation process
Suppliers are evaluated during and after selection by product companies,
primarily by personnel in the purchasing function. Internal training on how
to carry out supplier evaluations is published in the internal handbook of poli-
cies and guidelines The Way We Do Things.
The supplier evaluation process examines:
• Business partners’ record of governance, ethics and stance against
corruption
• Labor issues: Rejection of forced, compulsory or child labor, elimination
of discrimination, safeguarding employee health and safety, collective
bargaining rights
• Environmental performance: Managing waste, minimizing emissions,
and reducing the use of natural resources
• Human rights issues: Responsible sourcing and respect for human rights
in operations
At times, self-assessment checklists are sent to suppliers and on-site evalua-
tions are conducted regularly or when deemed necessary. These result in a
report with concrete suggestions in the form of an action plan or improve-
ments to be followed up on at an agreed time. Atlas Copco can provide experi-
ence and know-how to suppliers who need support in order to comply with
the minimum standards set forth in the business partner compliance docu-
ment. However, suppliers who fail to meet the criteria and do not show a
willingness to improve are rejected.
Suppliers´ commitment 2022 2021
Signicant suppliers, number 6 214 5 580
Suppliers audited on safety, health, social, and
environmental issues
1)
922 647
Suppliers approved (no need to follow up) 880 629
Suppliers conditionally approved (monitored) 41 18
Suppliers rejected (relationship ended)
2)
1 0
Suppliers asked on commitment to the
Code of Conduct, number
6 029 5 421
Signicant suppliers that have conrmed their
commitment to the Code, %
93 93
1)
Audits are conducted by Atlas Copco teams directly at the suppliers’ sites.
2)
Reasons for rejection relate to safety in the workplace, labor conditions, environment
issues, or non compliance of laws. Suppliers are rejected if they do not meet Atlas
Copco’s requirements and are not willing to improve. In 2022, one business partner
was rejected due to environ mental, health and safety issues.
Definition of significant suppliers:
All external suppliers of goods and services, direct and indirect, with a purchas-
ing value above a set threshold, based on 12-month values from October
previous year to September current year.
For suppliers in countries with heightened risk for human rights violations,
environmental risks or corruption etc., the purchasing threshold is lower
(approximately 13% of set value).
Responsible sourcing of minerals
Responsible sourcing of minerals is essential to Atlas Copco and though the
Group does not procure directly from smelters/refineries, some parts of the
supply chain do. Atlas Copco is not in the scope of Dodd-Frank Act or the EU
regulation 2017/821, but based on concerns of violations of human rights
including forced labor, human trafficking and child labor, and to support our
customers’ obligation to these Acts, the Group has measures to detect and
prevent the use of conflict minerals in its supply chain.
Atlas Copco requires its direct suppliers to commit to responsible sourcing
of all minerals included in parts and products they sell to us. This commitment
is exercised through minerals data collection and due diligence, implemented
every year. Moreover, all our significant suppliers must sign the Code of Con-
duct that includes an article on responsible sourcing requirements. The process
is described in detail on the Group’s website www.atlascopcogroup.com.
Atlas Copco has a comprehensive program to investigate the possible use of
conflict minerals in components used in Atlas Copco products. The program
ensures responsible sourcing of tin, tantalum, tungsten and gold. Cobalt was
added to the program in 2020, and data collection and due diligence using
the Responsible Minerals Initiative (RMI) guidelines and Cobalt Reporting
Template (CRT) will be rolled out continuously.
As a member of the RMI, Atlas Copco adheres to its guidelines by encourag-
ing suppliers to source from smelters verified by a third party such as RMI’s
Responsible Minerals Assurance Process (RMAP), and commits to transparency
by submitting reporting templates to customers about smelters in the supply
chain and collaborates with stakeholders.
Atlas Copco 2022 133
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
Distributors
Atlas Copco has a large international distributor base. Atlas Copco’s sales
strategies are set by the divisions on a global level and are tuned for local mar-
ket needs by the customer centers. These sales strategies include the choice of
sales channels and distributor management. The marketing councils ensure
cross- divisional alignment and develop central policies and tools that impact
all operations.
Starting in 2019, the percentage of significant distributors that sign the
Atlas Copco business criteria is measured as a Group KPI. In 2022, 92% of all
significant distributors signed the business partner criteria. 100% of the
significant distributors were asked to sign the criteria.
Definition of significant distributors:
All external distributors, including agents and resellers with sales of the
Group’s goods and services for a value above a set threshold, based on
12-month values from October previous year to September current year. For
distributors, agents and resellers in countries with a heightened risk for human
rights violations, environmental risks or corruption etc., the sales threshold is
set to include all active distributors.
Product responsibility
Atlas Copco strives to follow all applicable laws and regulations regarding
safety, health and environmental aspects, product information, safety infor-
mation and labeling. The information required by the Group’s procedures for
product and service information and labeling covers aspects such as sourcing
of components, substances of concern, safe use and disposal of the product.
Customer training is included when relevant, to secure safe handling of the
products.
In general, all electrically driven Atlas Copco products sold into the EU fall
under the EU Waste Electrical and Electronic Equipment (WEEE) Directive. This
includes compressors, vacuum pumps, handheld electric tools and monitoring
control instruments. Atlas Copco is responsible for, and arranges with custom-
ers, the correct disposal of products that fall under the directive.
Atlas Copco maintains lists of substances which are either prohibited or
must be declared due to their potential negative impact on health or the envi-
ronment. Prohibited substances are not allowed in the Group’s products or
processes. Items containing declarable substances are avoided or replaced
whenever possible.
Via a dedicated Atlas Copco communication platform all our suppliers can
be swiftly informed about upcoming legislative changes. A team of experts
then follow up with our suppliers to ensure our business partners around the
world understand and acknowledge the importance of adhering to the Atlas
Copco policy. The Atlas Copco Prohibited and Declarable list is under continu-
ous revision according to applicable legislations worldwide. This includes
REACH, RoHS, U.S. State of California Safe Drinking Water and Toxic Enforce-
ment Act of 1986 (Proposition 65) and Japanese Chemical Substance Control
Law (CSCL). The lists on prohibited and declarable substances are also pub-
lished on the Group’s website www.atlascopcogroup.com.
Incidents of non-compliance
No (0) cases have been filed in 2022 for non-compliance with such laws and
regulations concerning the provision and use of such products and services.
Atlas Copco 2022 134
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
Atlas Copco develops and offers a wide range of products for different end
markets and applications. Atlas Copco strives to provide the most energy effi-
cient products for each specific application to support its customers in mini-
mizing their energy consumption and reducing their climate impact.
Guidance from the EU issued in 2022 emphasizes that the term “eligibility”
does not require adherence to any reporting criteria other than fulfilling the
activity description for the products or services offered. Atlas Copco has there-
fore revised its conservative approach to eligibility of 2021 when only products
with high likeliness of also becoming aligned were included. As a result, reve-
nue eligibility has increased.
During 2022, each business area has identified one pilot product to be
assessed for revenue alignment rather than evaluating the entire product
range of Atlas Copco. A comprehensive assessment to evaluate the taxonomy
reporting criteria for Do No Significant Harm and Minimum Safeguards has
been completed, including Group-wide reporting of relevant capital expendi-
tures (CapEx) and operating expenditures (OpEx).
Atlas Copco deems its existing policies and procedures overall adequate
to conclude that no significant harm is caused to any environmental objective
and that the company complies with the social aspects of conducting business
in a responsible manner. However, recent EU taxonomy guidance, particularly
in relation to the Minimum Safeguards, indicates a restrictive compliance
interpretation. Therefore, Atlas Copco reports 0% alignment on all three KPIs.
Atlas Copco follows the development closely and may adjust its reporting in
the future.
Doing no signicant harm
Taxonomy alignment requires positive contribution to at least one of the tax-
onomy environmental objectives while doing no significant harm to any of the
other objectives. The taxonomy specifies specific criteria as to what constitutes
doing harm and what type of assessment a company should perform to evalu-
ate such potential harmdoing.
Atlas Copco has assessed its operations against the taxonomy’s appendixes
A, B, C and D as well as the requirements for not harming the transition to a
circular economy. The conclusion is that no significant harm is done. Improve-
ments may be implemented to certain existing policies and procedures. Atlas
Copco is reporting 0% alignment and therefore no detailed review of each
aspect of the criteria is shared at this stage.
Meeting the minimum safeguards
The EU taxonomy references adherence to the OECD Guidelines for Multi-
national Enterprises and the UN Guiding Principles on Business and Human
Rights, including the principles and rights set out in the eight fundamental
conventions identified in the Declaration of the International Labor Organiza-
tion on Fundamental Principles and Rights at Work and the International Bill
of Human Rights.
Atlas Copco has assessed compliance against the Minimum Safeguards
requirements. In principle, company policies align with the criteria, but as
recent guidance from the EU particularly in relation to the Minimum Safe-
guards, indicates a restrictive compliance interpretation, Atlas Copco reports
0% alignment. For this reason, no detailed review of each aspect of the criteria
is shared at this stage.
Revenue KPI
Based on the current EU taxonomy delegated act for climate change mitiga-
tion and climate change adaptation, Atlas Copco is eligible for climate change
mitigation under section 3.6 with the activity description “Manufacture of
technologies aimed at substantial greenhouse gas emission reductions in other
sectors of the economy”.
Atlas Copco defines eligibility as technologies which aim to enable substan-
tial energy savings and/or other means to avoid, reduce, remove, or store green-
house gas emissions compared to alternative technologies commonly used on
the market. This includes products and services that: 1) prevent the venting of
environmentally hazardous gases directly into the atmosphere, or 2) enable
substantial energy savings compared to available technologies commonly used
on the market by either use optimization, in and of themselves, by enabling the
shift to electric/battery power, or by introducing new solutions on the market.
Following clarifications by the EU during 2022, eligible technologies now
include:
• Energy efficient products and services which now or over time are
expected to meet the alignment criteria.
• Products and services which are aimed at being phased out and
replaced by aligned products.
In 2021, Atlas Copco included eligible revenues within customer segments
referenced in the taxonomy where Atlas Copco products and solutions play a
critical role in the manufacturing process. As there are no clear instructions
how enabling activities shall be assessed, Atlas Copco only reports under the
taxonomy section 3.6 in 2022. Atlas Copco follows the development closely
and may adjust its reporting subject to clarification.
Eligible technologies
The mapping of eligible technologies is an ongoing process and may result in
revisions in future reports as reporting practice develops. For the 2022 report-
ing the following have been included:
Within the Compressor Technique business area, a majority of products
and solutions are eligible and developed with the aim to lower customers’
energy consumption. This is predominately done through energy efficient
variable speed drive compressors but also fixed speed compressors are manu-
factured with the aim of offering energy efficiencies. Additional eligible prod-
ucts and solutions include e.g. on-site industrial gas generators, blowers,
boosters, and dryers as well as optimizing service solutions such as installations
for optimal air distribution.
Within the Vacuum Technique business area, abatement exhaust man-
agement solutions are eligible as they eliminate toxic and global warming
gases which would otherwise create a climate impact. Also included as eligible
are vacuum pump solutions which demonstrate market leading levels of
energy efficiency achieved by initiatives such as e.g. high-performance power
sources or IoT technology to optimize energy demand.
Within the Industrial Technique business area, a majority of products
and solutions aim to reduce customers’ energy consumption and are therefore
deemed eligible. This includes all products and solutions that support the
transition from pneumatic to electric power, as well as use optimization of
pneumatic products, making them as energy efficient as possible until
replaced by an electrical option.
Within the Power Technique business area, all electric or battery-driven
products are deemed eligible, supporting the shift from diesel to electric or
battery power. This includes the electric rental fleet. Also diesel-driven prod-
ucts are considered eligible because when necessary infrastructure for electric
solutions is lacking, diesel-driven machinery is required in the market for which
Atlas Copco offers very energy efficient solutions. Still, the aim is to replace
diesel-driven products with electric alternatives when possible. As a whole,
a majority of the business area’s product and solutions are eligible for the
Revenue KPI. Due to practical limitations, applicable to the rental fleet, only
the electric rental fleet is included in the OpEx and CapEx reporting.
The taxonomy eligible revenues include both products and services. It
excludes sales to oil and gas extraction industries. Sales to distributors and
rental companies have been excluded. Both Compressor Technique and Power
Technique have included revenues related to refurbishment, that is, improving
energy efficiency through a circular business model.
Technical screening criteria assessment
The 3.6 section demands that emission savings are calculated in a certified tool
and that these calculations need to be verified by a third party. In 2022, Atlas
Copco has certified its existing product carbon footprint (PCF) tool against ISO
14067:2018. Each business area identified one pilot product to be assessed for
alignment and an independent certification body has verified the life-cycle
emission calculations of these pilot products. All pilot products passed the
review and thereby the taxonomy’s technical screening criteria for alignment
under section 3.6.
Result
Revenue eligibility is 60% which is higher than the previous year. Recent guid-
ance from the EU, particularly in relation to the Minimum Safeguards, indicates
a restrictive compliance interpretation. Therefore, Atlas Copco reports 0%
alignment. Atlas Copco follows the development closely and may adjust its
reporting in the future.
EU Taxonomy regulation disclosures
The European Union (EU) taxonomy aims to provide guidance and over time a comprehensive classification system for sustainability,
structured into different economic activities that companies can perform. It consists of six environmental objectives of which two are
relevant for the financial year 2022: climate change mitigation and climate change adaptation.
Atlas Copco 2022 135
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
CapEx KPI
The CapEx reporting has been extended and more clearly linked to the specific
economic activities in the taxonomy compared to the previous year. Atlas
Copco utilizes all types of taxonomy listed capital expenditure for the CapEx
numerator, listed below:
• “CapEx related to assets or processes that are associated with taxono-
my-aligned activities”: Used for investments in factories that enable
production of products relating to taxonomy section 3.6.
• “A CapEx Plan to increase the proportion of taxonomy-aligned products”:
Used for the reporting of R&D capital expenditure relating to taxonomy
section 3.6.
• “The purchase of output of taxonomy-aligned products”: Used for
taxonomy product additions into Atlas Copco’s hire fleet relating to
taxonomy section 3.6.
• “Individual measures” to lower Atlas Copco’s own greenhouse gas emis-
sions: Used for installations of energy efficiency equipment, installations
of charging stations for electric vehicles, installations controlling building
energy performance, installations of renewable energy technologies, and
investments related to the company vehicle fleet (relating to taxonomy
sections 6.5, 7.3, 7.4, 7.5, and 7.6).
The CapEx denominator used for the taxonomy KPI calculation consists of
additions to tangible and intangible assets (including right of use assets)
during the financial year, considered before depreciation, amortization,
and any re-measurements, including those resulting from revaluations
and impairments, and excluding fair value changes. The denominator also
includes additions to tangible and intangible assets resulting from business
combinations.
No significant climate change adaptation investments have been made
during the year.
Result
CapEx eligibility is 7% which is in line with the previous year, however, both
the numerator and the denominator value are significantly higher. Recent
guidance from the EU, particularly in relation to the Minimum Safeguards,
indicates a restrictive compliance interpretation. Therefore, Atlas Copco
reports 0% alignment and 0 MSEK in regards to the CapEx plan to expand its
proportion of taxonomy-aligned products within R&D (both for this report-
ing period and the full time period of the plan). Atlas Copco follows the devel-
opment closely and may adjust its reporting in the future.
OpEx KPI
As of 2022, the OpEx numerator only includes OpEx that is material to the
company business model, i.e. expenditures in R&D and the own hire fleet
(relating to taxonomy section 3.6). The denominator however includes
expenditures for R&D and hire fleet as well as maintenance costs for
buildings, equipment, and own vehicle fleet.
Result
OpEx eligibility is 22% which is slightly higher than the previous year. Recent
guidance from the EU, particularly in relation to the Minimum Safeguards, indi-
cates a restrictive compliance interpretation. Therefore, Atlas Copco reports
0% alignment. Atlas Copco follows the development closely and may adjust its
reporting in the future.
Concluding comments
An increased revenue eligibility is reported in 2022 in line with clarifications
issued by the EU, allowing a less conservative approach to eligibility compared
to 2021. The company has conducted a comprehensive assessment to evaluate
and prepare for taxonomy alignment reporting. In principle, Atlas Copco com-
pany policies and procedures correspond with taxonomy requirements, how-
ever, as recent guidance from the EU, particularly in relation to the Minimum
Safeguards, indicates a restrictive compliance interpretation Atlas Copco
reports 0% alignment on all three KPIs.
As the taxonomy reporting practice and guidelines develop, and as the
scope evolves with four additional environmental objectives, Atlas Copco will
reevaluate its current approach. Clarification in how to report enabling activi-
ties is also likely to impact the taxonomy mapping as many of the company’s
products and solutions are essential in specific manufacturing processes
which are included in the taxonomy.
Revenue
Substantial contribution criteria
DNSH criteria
(Does Not Significantly Harm)
Economic activities
Code
Absolute revenue
(MSEK)
Proportion
of revenues
(%)
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
prevention
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and
marine resources
Circular economy
Pollution
prevention
Biodiversity and
ecosystems
Minimum
safeguards
Taxonomy-
aligned
pro portion
of revenues,
year N
Taxonomy-
aligned
pro portion
of revenues,
year N-1
Cate gory
(enab ling
activity)
Category
(transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES 60.28%
A1. Environmentally sustainable activities (Taxonomy-aligned)
Revenue from environmentally sustainable activities
(Taxonomy-aligned) (A.1) 0.0 0.00% 100% 0.00%
A2. Taxonomy-eligible but not environmentally sustainable
activities (not Taxonomy-aligned activities)
Manufacture of other low-carbon technologies 3.6 85 193.0 60.28%
Revenue from Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned activities) (A.2) 85 193.0 60.28%
Total (A.1 + A.2) 85 193.0 60.28%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
Revenue from Taxonomy-non-eligible activities (B) 56 132.2 39.72%
Total (A + B) 141 325.2 100.00%
Atlas Copco 2022 136
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Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
CapEx
Substantial contribution criteria
DNSH criteria
(Does Not Significantly Harm)
Economic activities
Code
Absolute CapEx
(MSEK)
Proportion
of CapEx
(%)
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
prevention
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
prevention
Biodiversity and
ecosystems
Minimum
safeguards
Taxonomy-
aligned
proportion
of CapEx,
year N
Taxonomy-
aligned
proportion
of CapEx,
year N-1
Cate gory
(enab ling
activity)
Category
(transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES 7.34%
A1. Environmentally sustainable activities (Taxonomy-aligned)
CapEx of environmentally sustainable activities
(Taxonomy-aligned) (A.1) 0.0 0.00% 100% 0.00%
A2. Taxonomy-eligible but not environmentally sustainable
activities (not Taxonomy-aligned activities)
Manufacture of other low-carbon technologies 3.6 560.5 4.26%
Transport of motorbikes, passenger cars and light
commercial vehicles 6.5 377.9 2.87%
Installation of energy efficiency equipment 7.3 13.1 0.10%
Installation of charging stations for electric vehicles in buildings
(and parking spaces attached to buildings) 7.4 3.2 0.02%
Installation of instruments and devices for measuring,
regulation and controlling energy performance of buildings 7.5 0.4 0.00%
Installation of renewable energy technologies 7.6 9.9 0.08%
CapEx of Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned activities) (A.2) 964.9 7.34%
Total (A.1 + A.2) 964.9 7.34%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
CapEx of Taxonomy-non-eligible activities (B) 12 181.1 92.66%
Total (A + B) 13 146.0 100.00%
OpEx
Substantial contribution criteria
DNSH criteria
(Does Not Significantly Harm)
Economic activities
Code
Absolute OpEx
(MSEK)
Proportion
of OpEx
(%)
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
prevention
Biodiversity and
ecosystems
Climate change
mitigation
Climate change
adaptation
Water and marine
resources
Circular economy
Pollution
prevention
Biodiversity and
ecosystems
Minimum
safeguards
Taxonomy-
aligned
proportion
of OpEx,
year N
Taxonomy-
aligned
proportion
of OpEx,
year N-1
Cate gory
(enab ling
activity)
Category
(transitional
activity)
A. TAXONOMY-ELIGIBLE ACTIVITIES 21.79%
A1. Environmentally sustainable activities (Taxonomy-aligned)
OpEx of environmentally sustainable activities
(Taxonomy-aligned) (A.1) 0.0 0.00% 100% 0.00%
A2. Taxonomy-eligible but not environmentally sustainable
activities (not Taxonomy-aligned activities)
Manufacture of other low-carbon technologies 3.6 1 185.7 21.79%
OpEx of Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned activities) (A.2) 1 185.7 21.79%
Total (A.1 + A.2) 1 185.7 21.79%
B. TAXONOMY-NON-ELIGIBLE ACTIVITIES
OpEx of Taxonomy-non-eligible activities (B) 4 256.5 78.21%
Total (A + B) 5 442.2 100.00%
Atlas Copco 2022 137
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Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contacts
About the sustainability report
Sustainability is an integral part of Atlas Copco’s business model and the
Group therefore reports nancial and non-nancial data in an integrated
annual report. The sustainability report includes information regarding issues
where Atlas Copco has a signicant impact on the economy, environment
and people, including human rights.
Atlas Copco publishes a sustainability report annually. This year’s report
has been prepared in accordance with GRI Standards 2021 and applies to the
period January 1, 2022 through December 31, 2022, which is in line with the
Group’s nancial reporting. This sustainability report was published on March
22, 2023.
Additional disclosures in 2022
Our ambition is to present an overview of our impact that is as comprehensive
and transparent as possible, as well as how we manage the impact. Therefore,
we continuously strive to develop our reporting in areas relevant to our impact
and value creation. During the year, through an internal process, we identied
and added a number of disclosures linked to our material sustainability topics.
These are disclosures that we believe contribute to increased transparency and
a better understanding of our impact and processes, or information that has
been requested by our stakeholders. The disclosures that have been added to
this year’s report are marked with* in the GRI index on pages 139–142.
Report boundary
Environmental data covers all operations from year 2022 if nothing else is
stated. These gures are therefore not comparable to previous years’ sustain-
ability reports. CO
2
e emissions data covers all operations from 2019. Other
environmental data up until 2022 covers production units and distribution
centers, and is presented separately in the table to the right on page 144.
Supplier data covers production units and distribution centers, while distribu-
tor data covers all applicable units. Employee data covers all operations.
Operations divested during the year are excluded, while acquired units are
included. This may at times cause changes in reported performance.
Data collection
Reported facts and gures in the sustainability report have been veried in
accordance with Atlas Copco’s procedures for internal control. Data collection
is integrated into the Group reporting consolidation systems and collected on
a quarterly basis. Reported values are normally not corrected retroactively.
When a restatement of historically reported numbers is made, this can be due
to a change of calculation method or scope, see Report boundary.
Responsibility for reporting rests with the general manager of each com-
pany. Data is reported at local operating unit level, aggregated to division/
business area and Group level. For certain Science Based Target categories
data is reported at division level. Data verication is performed at each level
before submitted to external auditors for verication.
SASB standards
To accommodate stakeholders that are more familiar with the Sustainability
Accounting Standards Board (SASB), Atlas Copco has published a table with-
cross-references to information in the annual report on page 143. Information
relating to the SASB standards for ‘Industrial machinery and goods’ is dis-
closed for relevant aspects where data is available. However, Atlas Copco does
not claim adherence to, or compliance with, the SASB reporting standards.
Scope and content of the sustainability report
Sustainability information in the annual report is primarily presented
on pages 5–12, 33–42 and 126–145.
External assurance
Atlas Copco’s external auditors, Ernst & Young, have performed a limited
review of the sustainability report according to the GRI Standards, see the
Auditor’s report on page 146.
For questions regarding the sustainability report, please contact
Anna Sjörén, Vice President Sustainability
sustainability@atlascopco.com
Atlas Copco 2022 138
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
GRI content index
GRI Standard Disclosure Location Comments and omissions
General disclosures
Nr Description
GRI 2:
General Disclosures 2021
2-1 Organizational details
2-2 Entities included in the organization’s sustainability reporting 119–122, 138
2-3 Reporting period, frequency and contact point 138
2-4 Restatements of information 42, 138, 144–145
2-5 External assurance 138
2-6 Activities, value chain, and other business relationships Inside cover, 7–10, 21–33 For information on signicant acquisitions and divestments, see pages 20–32.
2-7 Employees 80, 83, 132 Omission: Atlas Copco reports aggregate number of full-time equivalents.
The gures broken down into full-time/part-time employees, and additional
workforce by gender, are currently not available in the Group's HR system
and can therefore not be reported.
2-8 Workers who are not employees 132 Omission: Additional workforce may be temporary or permanent, generally
employed by a third party. Additional workforce by gender or by type of
contracutal relationship is currently not available in the Group's HR system
and can therefore not be reported.
2-9 Governance structure and composition 52–53, 129
2-10 Nomination and selection of the highest governance body 53
2-11 Chair of the highest governance body 55 The chair of the board is not a senior executive of Atlas Copco.
2-12 Role of the highest governance body in overseeing the management of impacts 53, 129
2-13 Delegation of responsibility for managing impacts 129
2-14 Role of the highest governance body in sustainability reporting 129
2-15 Conicts of interest 53 Atlas Copco operates in compliance with the Swedish Companies Act which
includes rules and procedures applicable to conicts of interest.
2-16 Communication of critical concerns 53, 129–130
2-17 Collective knowledge of the highest governance body 53
2-18 Evaluation of the performance of the highest governance body 53
2-19 Remuneration policies 82–83
2-20 Process to determine remuneration 53–54
2-21 Annual total compensation ratio Omission: Not reported at Group-level. Atlas Copco is committed to a fair and
sustainable remuneration policy, both to stay competitive as an employer and
from an internal equity perspective. We are currently not able to report on this
disclosure in a meaningful manner, but remain committed to transparency in
this regard.
2-22 Statement on sustainable development strategy 3–4, 54
2-23 Policy commitments 129
Statement of use
Atlas Copco has reported in accordance with the GRI Standards for the period 1 January, 2022 to 31 December, 2022.
GRI 1 used
GRI 1: Foundation 2021
Atlas Copco 2022 139
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
GRI content index
GRI Standard Disclosure Location Comments and omissions
2-24 Embedding policy commitments 40–41, 51, 129
2-25 Processes to remediate negative impacts 129
General disclosures
Nr Description
2-26 Mechanisms for seeking advice and raising concerns 40, 129
2-27 Compliance with laws and regulations 130
2-28 Membership associations 129
2-29 Approach to stakeholder engagement 126
2-30 Collective bargaining agreements 132
Material topic disclosures
GRI 3: Material topics 2021 3-1 Process to determine material topics 127 See more information on www.atlascopcogroup.com
3-2 List of material topics 127
3-3 Management of material topics 6, 129
ECONOMIC IMPACT
Economic performance
GRI 3: Material topics 2021 3-3 Management of material topics 6, 129–130
GRI 201:
Economic performance
2016
201-1 Direct economic value generated and distributed 130, 145
201-2 Financial implications and other risks and opportunities due to climate change * 46, 131 Omission: The assessment of climate-related risks and their nancial
implications has started at divisional level. However, the outcome is not yet
consolidated and disclosed in quantitative terms outside the organization.
Anti-corruption
GRI 3: Material topics 2021 3-3 Management of material topics 6, 40–41, 129–130
GRI 201: Economic
performance 2016
205-1 Operations assessed for risks related to corruption * 130
205-2 Communication and training about anti-corruption policies and procedures * 40–41, 145 Omission: A new mandatory training in the Code of Conduct will be launched
in 2023, and data for employees is therefore not available. Data on signicant
suppliers are not broken down by type or region.
205-3 Conrmed incidents of corruption and actions taken 130
Anti-competitive behavior
GRI 3: Material topics 2021 3-3 Management of material topics 6, 40–41, 129–130
GRI 201: Economic
performance 2016
206-1 Legal actions for anti-competitive behavior, anti-trust, and monopoly practices 130
ENVIRONMENTAL IMPACT
Energy
GRI 3: Material topics 2021 3-3 Management of material topics 43–44, 129–131
* The disclosure has been added in this years’ report
Atlas Copco 2022 140
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
GRI content index
GRI Standard Disclosure Location Comments and omissions
GRI 302: Energy 2016 302-1 Energy consumption within the organization 130, 144
302-3 Energy intensity 144
Emissions
GRI 3: Material topics 2021 3-3 Management of material topics 6, 43–44, 129–131
GRI 305: Emissions 2016 305-1 Direct greenhouse gas emissions (Scope 1) 6, 42, 144
305-2 Energy indirect greenhouse gas emissions (Scope 2) 6, 42, 144
305-3 Other indirect greenhouse gas emissions (Scope 3) 6, 42, 144
305-4 Greenhouse gas emissions intensity 6, 42, 144
Supplier environmental
assessment
GRI 3: Material topics 2021 3-3 Management of material topics 6, 43, 133
GRI 308: Supplier environ-
mental assessment 2016
308-1 New suppliers that were screened using environmental criteria 133 Signicant suppliers, both new and existing, are identied using a risk-based
approach. Omission: Data for new suppliers is not specically disclosed.
Environmental and social screening is conducted and reported jointly.
308-2 Negative environmental impacts in the supply chain and actions taken * 133 Omission: Supplier audits cover both environmental and social aspects and
the data is not broken down into these categories.
SOCIAL IMPACT
Employment
GRI 3: Material topics 2021 3-3 Management of material topics 6, 38–39, 129
GRI 401: Employment 2016 401-1 New employee hires and employee turnover 132, 145 Omission: Atlas Copco does not report turnover by age group and gender.
Occupational health
and safety
GRI 3: Material topics 2021 3-3 Management of material topics 6, 39, 129, 132
GRI 403: Occupational
health and safety 2018
403-1 Occupational health and safety management system 39, 129, 132
403-2 Hazard identication, risk assessment, and incident investigation 129, 132
403-3 Occupational health services 39, 129
403-4 Worker participation, consultation, and communication on occupational health
and safety
39
403-5 Worker training on occupational health and safety 39, 132
403-6 Promotion of worker health 39
403-7 Prevention/mitigation of occupational health/safety impacts directly linked by
business relationships
132
403-8 Workers covered by an occupational health and safety management system * 132 Calculation based on units required to be ISO 45001-certied
403-9 Work-related injuries 132
* The disclosure has been added in this years’ report
Atlas Copco 2022 141
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
GRI Standard Disclosure Location Comments and omissions
Training and education
GRI 3: Material topics 2021 3-3 Management of material topics 6, 37–38, 129
GRI 404: Training and
education 2016
404-1 Average hours of training per year per employee * 145 Omission: Atlas Copco does not have data broken down by gender.
404-2 Programs for upgrading employee skills and transition assistance programs * 37, 132
404-3 Percentage of employees receiving regular performance and career
development reviews
145 Omission: Atlas Copco does not have data broken down by gender and
employee category.
Diversity and inclusion
GRI 3: Material topics 2021 3-3 Management of material topics 6, 37–38, 129, 132
GRI 405: Diversity and equal
opportunity 2016
405-1 Diversity of governance bodies and employees 6, 53, 55–58, 133 Omission: Atlas Copco does not, unless required for compliance with local
laws and regulations, gather data on diversity from employees or members of
governance bodies, such as belonging to a minority or vulnerable group.
Non-discrimination
GRI 3: Material topics 2021 3-3 Management of material topics 40–41, 129
GRI 406: Non-discrimination
2016
406-1 Incidents of discrimination and corrective actions taken 130
Supplier social assessment
GRI 3: Material topics 2021 3-3 Management of material topics 6, 40–41, 133
GRI 414: Supplier social
assessment 2016
414-1 New suppliers that were screened using social criteria 133 Signicant suppliers, both new and existing, are identied using a risk-based
approach. Omission: Data for new suppliers is not specically disclosed.
Environmental and social screening is conducted and reported jointly.
414-2 Negative social impacts in the supply chain and actions taken * 133 Omission: Supplier audits cover both environmental and social aspects and
the data is not broken down into these categories.
Customer health and safety
GRI 3: Material topics 2021 3-3 Management of material topics 41, 128–129, 134
416-2 Incidents of non-compliance concerning the health and safety
impacts of products and services
134
Marketing and labeling
GRI 3: Material topics 2021 3-3 Management of material topics 129, 134
GRI 417: Marketing and
labeling 2016
417-2 Incidents of non-compliance concerning products and service
information and labeling
134
GRI content index
* The disclosure has been added in this years’ report
Atlas Copco 2022 142
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Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
Energy management 1. Total energy consumed
2. Percentage grid electricity
3. Percentage renewable energy RT-IG-130a.1 Total energy is reported in MWh, not in gigajoules. Percentage of grid electricity is not reported. 130
Employee health & safety 1. Total recordable incident rate (TRIR)
2. Fatality rate
3. Near-miss frequency rate (NMFR) RT-IG-320a.1 132, 145
Fuel economy and emissions
in use-phase
Sales-weighted fuel eciency for
non-road equipment
RT-IG-410a.2
Product fuel eciency is not reported but the Group innovates to help customers increase energy
eciency and reduce emissions. All projects for new and redesigned products should have targets for
reduced carbon impact. 34–36
Materials sourcing Description of the management of risks
associated with the use of critical materials RT-IG-440a.1 Risk management associated with conict minerals is described. 41, 47, 129, 133
Remanufacturing design & services Revenue from remanufactured products
and remanufacturing services RT-IG-440b.1 Share of revenues is not reported but topic is addressed. 35
Topic Metric Code Comment Page
SASB Index
Table 1. Sustainability disclosure topics and accounting metrics
Number of units produced by product category RT-IG-000.A Not reported.
Number of employees RT-IG-000.B 18, 83, 145
Table 2. Activity metrics
Metric Code Comment Page
Atlas Copco 2022 143
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
Sustainability performance
1)
EMISSIONS, ALL OPERATIONS
2)
Base year (2019) 2020 2021 2022
Scope 1: Direct CO
2
e emissions (’000 tonnes)
3) 4)
75 75 79 77
Scope 2: Indirect CO
2
e emissions (’000 tonnes)
3) 4)
87 83 56 31
Scope 1+2: CO
2
e emissions (’000 tonnes)
3) 4)
162 158 135 108
Scope 2: Location-based indirect CO
2
e emissions (’000 tonnes)
3) 4)
– – – 138
Scope 3: Other indirect CO
2
e emissions (’000 tonnes)
3) 4)
170 634 172 279 179 393 219 822
Scope 1+2: CO
2
e emissions/COS (tonnes)
3) 4) 7)
3.0 3.0 2.3 1.5
Scope 3: CO
2
e emissions/COS (tonnes)
3) 4) 7)
3 141 3 226 3 016 2 962
ENVIRONMENT, ALL OPERATIONS
2)
2020 2021 2022
Renewable energy for operations, % of total energy use
5)
– – 58.0
Direct energy use in GWh
5) 6)
– – 159
Indirect energy use in GWh
5) 6)
– – 359
Total energy use in GWh
5) 6)
– – 518
Total energy use in MWh/COS
5) 6) 7)
– – 7.0
Total waste in ’000 kg – – 54 855
Waste (in kg)/COS
7)
– – 739
Reused, recycled or recovered waste, % – – 92
Water consumption in ’000 m
3
– – 624
Water consumption (m
3
)/COS
7)
– – 8.4
1)
Calculations according to GRI Standard Guidelines, www.globalreporting.org
2)
All operations include all entities
3)
CO
2
e stands for carbon dioxide equivalent emissions
4)
The reporting of greenhouse gas emissions is done in accordance with the GHG Protocol (ghgprotocol.org). Country factors used for
energy come from the International Energy Agency. Scope 2 is presented both as market-based and location-based according to the GHG
Protocol. A market-based approach has been applied unless otherwise stated. Factors from NTM (transportmeasures.org) are used for
transport of goods when emission data is not provided by the transport company.
Scope 1 includes direct energy in own operations and fuel used in company vehicles. Scope 2 includes indirect energy from own
operations and electricity from company vehicles. Scope 3 includes GHG emissions upstream and downstream in the value chain.
Out of scope emissions data for direct CO
2
emissions from biologically sequestered carbon (e.g. CO
2
from burning biomass/biofuels)
was 3561 tonnes in 2022.
5)
Energy use excludes fuel and energy from company vehicles.
6)
Total energy includes both indirect and direct energy used. Atlas Copco does not report cooling or steam separately. The calculation of
direct energy, i.e. energy generated by the company for its own production or operation, comprises all fuels used on the sites, including
diesel, oil, biofuel, gasoline, solar, geothermal, propane and natural gas.
7)
Operating costs include cost of sales, marketing expenses, administration expenses, research and development expenses, other operating
expenses, deducted for employee wages and benets. COS, when presented in relation to sustainability information, refers to cost of sales
at standard cost in MSEK.
ENVIRONMENT, PRODUCTION AND DISTRIBUTION UNITS 2020 2021 2022
Renewable energy for operations, % of total energy use 44 58 67
Direct energy use in GWh
5)
100 115 108
Indirect energy use in GWh
5)
251 270 283
Total energy use in GWh
5)
351 385 391
Total energy use in MWh/COS
5) 7)
6.6 6.5 5.3
Total waste in ’000 kg 31 036 35 071 39 112
Waste (in kg)/COS
7)
581 590 527
Reused, recycled or recovered waste, % 93 93 94
Water consumption in ’000 m
3
384 395 403
Water consumption (m
3
)/COS
7)
7.2 6.6 5.4
SUPPLIERS WITH ENVIRONMENTAL MANAGEMENT SYSTEM 2020 2021 2022
Signicant direct suppliers with an approved environmental
management system, % 30 31 31
Atlas Copco 2022 144
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
Sustainability performance
1)
, continued
1)
Calculations according to GRI Standard Guidelines, www.globalreporting.org
2)
Direct economic value includes revenues, other operating income, nancial income, prot from divested companies and share of prot in
associated companies.
3)
Operating costs include cost of sales, marketing expenses, administration expenses, research and development expenses, other operating
expenses, deducted for employee wages and benets. COS when presented in relation to sustainability information refers to cost of sales
at standard cost in MSEK.
4)
Costs for providers of capital include nancial costs and dividend, but exclude redemption of shares and repurchase of own shares.
5)
Will be measured rst time in 2023.
6)
Results are collected every two years through the Group’s employee survey. Next survey in 2023.
7)
The training will be launched in 2023.
ECONOMIC VALUE 2020 2021 2022
Direct economic value
2)
100 251 111 972 142 233
Revenues 99 787 110 912 141 325
Economic value distributed
Operating costs
3)
55 362 61 019 78 094
Employee wages and benets, including other social costs 25 582 27 151 33 580
Costs for providers of capital
4)
8 988 9 281 9 765
Costs for direct taxes to governments 4 801 5 372 7 262
Economic value retained 5 518 9 149 13 532
– Redemption of shares – – 9 732
PEOPLE 2020 2021 2022
White-collar employees, % 70 69 69
Blue-collar employees, % 30 31 31
Employee turnover white-collar employees, % 4.2 6.4 7.6
Employee turnover blue-collar employees, % 4.8 7.8 8.9
Total turnover, voluntary leave, % 4.4 6.9 8.0
Yearly performance and development discussion, % 85 82 79
Average training hours per employee 37.8 39.5 42.0
Average training hours, white-collar employees 37.9 39.9 43.2
Average training hours, blue-collar employees 37.6 38.6 39.4
Proportion of female employees, % year end 20.0 20.9 21.6
Proportion of female managers, % year end 19.7 20.5 20.4
Degree to which employees agree that they feel a sense of
belonging in the company (score)
5)
– – –
Degree to which employees agree that there are opportunities
to learn and grow in the company (score)
6)
– 73 –
Degree to which employees agree that we have a work culture
of respect, fairness and openness (score)
6)
– 76 –
SAFETY AND WELLBEING 2020 2021 2022
Recordable injuries total workforce, number 385 387 403
Recordable injuries per million working hours total workforce 4.8 4.5 4.2
Minor injuries total workforce, number 922 1 148 1 261
Minor injuries per million working hours total workforce 11.6 13.4 13.2
Fatalities, number 0 0 0
Fatalities per million working hours total workforce 0 0 0
Sick leave due to diseases and recordable injuries, % 2.1 2.2 2.5
Degree to which employees agree that Atlas Copco takes
a genuine interest in their wellbeing (score)
5)
– 73 –
A balanced safety pyramid (yes/no) Yes Yes Yes
ETHICS 2020 2021 2022
Employees signed compliance to the Code of Conduct, % 99 98 99
Employees participate in the Group’s biennial ethics training
7)
, % – – –
New employees participate in the Group’s ethics training within 12 months
of joining the company
7)
, % – – –
Signicant suppliers committed to the Code of Conduct, % 93 93 93
Signicant distributors committed to the Code of Conduct, % 84 87 92
Atlas Copco 2022 145
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
This is the translation of the auditor’s report in Swedish.
To Atlas Copco AB, corporate identity number 556014-2720
Stockholm, 20 March, 2023
Ernst & Young AB
Introduction
We have been engaged by the Board of Directors of Atlas
Copco AB to undertake a limited assurance engagement
of Atlas Copco AB’s Sustainability Report for the year
2022. Atlas Copco AB has dened the scope of the Sus-
tainability Report to the pages referred to in the GRI index
on pages 139–142, the Statutory Sustainability Report is
dened on page 19.
Responsibilities of the Board and
Executive Management
The Board of Directors and Executive Management are
responsible for the preparation of the Sustainability
Report including the Statutory Sustainability Report in
accordance with applicable criteria and the Annual
Accounts Act respectively. The criteria are dened on
pages 138–142 in the Sustainability Report and consist of
the GRI Sustainability Reporting Standards, as well as the
accounting and calculation principles that the company
has developed. This responsibility includes the internal
control relevant to the preparation of a Sustainability
Report that is free from material misstatements, whether
due to fraud or error.
Responsibilities of the auditor
Our responsibility is to express a conclusion on the
Sustainability Report based on our limited assurance
procedures and to express an opinion regarding the Stat-
utory Sustainability Report. Our engagement is limited to
historical information presented in this document and
does therefore not cover future oriented information.
We have conducted our engagement in accordance
with ISAE 3000 (revised) Assurance engagements other
than audits or reviews of historical nancial information.
A limited assurance engagement consists of making
inquiries, primarily of persons responsible for the prepa-
ration of the Sustainability Report, and applying analyti-
cal and other limited assurance procedures. Our examina-
tion regarding the Statutory Sustainability Report has
been conducted in accordance with FAR’s accounting
standard RevR 12 The auditor’s opinion regarding the
statutory sustainability report. A limited assurance
engagement and an examination according to RevR 12
are dierent from and substantially less in scope than rea-
sonable assurance conducted in accordance with IAASB’s
Standards on Auditing and other generally accepted
auditing standards in Sweden.
The rm applies ISQC 1 (International Standard on
Quality Control) and accordingly maintains a comprehen-
sive system of quality control including documented poli-
cies and procedures regarding compliance with ethical
requirements, professional standards and applicable
legal and regulatory requirements. We are independent
of Atlas Copco AB in accordance with professional ethics
for accountants in Sweden and have otherwise fullled
our ethical responsibilities in accordance with these
requirements.
The procedures performed in a limited review and an
examination according to RevR 12 do not enable us to
obtain assurance that we would become aware of all sig-
nicant matters that might be identied in a reasonable
assurance engagement. The conclusion based on limited
assurance procedures and an examination according to
RevR 12 does not provide the same level of assurance as a
conclusion based on reasonable assurance.
Our procedures are based on the criteria dened by
the Board of Directors and the Executive Management as
described above. We consider these criteria suitable for
the preparation of the Sustainability Report.
We believe that the evidence we have obtained is
sucient and appropriate to provide a basis for our
conclusions below.
Conclusions
Based on the limited assurance procedures we have per-
formed, nothing has come to our attention that causes us
to believe that the Sustainability Report is not prepared,
in all material respects, in accordance with the criteria
dened by the Board of Directors and Executive
Management.
A Statutory Sustainability Report has been prepared.
Outi Alestalo
Expert Member of FAR
Erik Sandström
Authorized Public Accountant
Auditor’s Limited Assurance Report on Atlas Copco AB’s Sustainability Report
and statement regarding the Statutory Sustainability Report
Atlas Copco 2022 146
SUSTAINABILITY NOTES
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
• Sustainability notes
Four years in summary
Contact information
ORDERS, REVENUES AND PROFIT 2019 2020 2021 2022
Orders, MSEK 106 104 100 554 129 545 158 092
Revenues, MSEK 103 756 99 787 110 912 141 325
Change, organic from volume, price and mix, % 2 –3 14 12
EBITDA, MSEK 26 597 24 335 29 025 36 549
EBITDA margin, % 25.6 24.4 26.2 25.9
Operating prot, MSEK 21 897 19 146 23 559 30 216
Operating prot margin, % 21.1 19.2 21.2 21.4
Net interest expense, MSEK –359 –245 –234 –166
Prot before tax, MSEK 21 572 18 825 23 410 30 044
Prot margin, % 20.8 18.9 21.1 21.3
Prot for the year, MSEK 16 543 14 783 18 134 23 482
EMPLOYEES
2019 2020 2021 2022
Average number of employees 37 805 39 606 41 272 45 781
Revenues per employee, SEK thousands 2 745 2 519 2 687 3 087
CASH FLOW
2019 2020 2021 2022
Operating cash surplus, MSEK 26 696 25 081 28 952 36 978
Cash ow before change in working capital, MSEK 20 209 20 454 23 870 29 600
Change in working capital, MSEK –2 971 2 166 –244 –7 415
Cash ow from investing activities, MSEK –9 683 –16 286 –6 121 –15 503
Gross investments in other property, plant and
equipment, MSEK –1 662 –1 459 –1 970 –3 660
Gross investments in rental equipment, MSEK –1 140 –486 –510 –884
Net investments in rental equipment, MSEK –1 087 –416 –474 –808
Cash ow from nancing activities, MSEK –8 024 –8 552 –10 323 –14 651
of which dividends paid, MSEK –7 663 –8 506 –8 889 –9 250
Operating cash ow, MSEK 14 625 18 910 19 378 17 099
Four years in summary
FINANCIAL POSITION AND RETURN 2019 2020 2021 2022
Total assets, MSEK 111 722 113 366 136 683 172 301
Capital turnover ratio 0.98 0.86 0.88 0.91
Capital employed, average MSEK 72 732 83 649 87 537 106 054
Capital employed turnover ratio 1.43 1.19 1.27 1.33
Return on capital employed, % 30 23 27 29
Net indebtedness, MSEK 12 013 16 421 8 151 26 570
Net debt/EBITDA, MSEK 0.5 0.7 0.3 0.7
Equity, MSEK 53 290 53 534 67 634 80 026
Debt/equity ratio, % 23 31 12 33
Equity/assets ratio, % 48 47 49 46
Return on equity, % 35 27 30 32
KEY FIGURES PER SHARE
2019
1)
2020
1)
2021
1)
2022
Basic earnings / diluted earnings, SEK 3.40 / 3.40 3.04 / 3.04 3.72 / 3.71 4.82 / 4.81
Dividend, SEK 1.75 1.83 1.90 2.30
2)
Dividend as % of basic earnings 51.5 60.0 51.0 47.7
Dividend yield, % 2.4 1.9 1.4 2.0
Redemption of shares, SEK – – 2.00 –
Operating cash ow, SEK 3.01 3.89 3.98 3.51
Equity, SEK 11 11 14 16
Share price, December 31, A share / B share, SEK 93.4 / 81.3 105.3 / 92.1 156.5 / 133.1 123.1 / 111.1
Highest price quoted, A share / B share, SEK 96.6 / 84.2 111.4 / 97.5 157.4 / 133.4 161.2 / 136.3
Lowest price quoted, A share / B share, SEK 51.3 / 47.1 66.7 / 57.9 108.5 / 94.8 92.5 / 83.2
Average closing price, A share / B share, SEK 72.0 / 64.7 96.3 / 84.5 134.9 / 114.9 117.9 / 104.4
Average number of shares, millions 4 858.8 4 861.7 4 870.9 4 868.4
Diluted average number of shares, millions 4 863.1 4 869.0 4 882.1 4 875.9
Number of shareholders, December 31 81 656 82 079 87 923 115 459
Market capitalization, December 31, MSEK 440 497 497 187 732 967 586 731
1)
Adjusted for share split in 2022
2)
Proposed by the Board
Atlas Copco 2022 147
FOUR YEARS IN SUMMARY
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
Sustainability notes
• Four years in summary
Contact information
Atlas Copco 2022 148
CONTACT INFORMATION
Atlas Copco 2022 148
CONTACT INFORMATION
Investor relations
Daniel Altho, Vice President Investor Relations
ir@atlascopco.com
Sustainability
Anna Sjörén, Vice President Sustainability
sustainability@atlascopco.com
Media
Amanda Billner, Media Relations Manager
media@atlascopco.com
Atlas Copco in cooperation with
Griller grask form AB and Text Helene AB
Copyright 2023, Atlas Copco AB, Stockholm, Sweden
Prepress: Bildrepro
Print: Hylte Tryck
8993 0001 88
Introduction
This is Atlas Copco
The year in review
Financials
Other information
Signatures of the Board
of Directors
Audit Report
Financial denitions
Sustainability notes
Four years in summary
• Contact information
Atlas Copco 2022 149
Phone: +46 8 743 80 00
Reg. no: 556014-2720
atlascopcogroup.com