R+D+I strategy

Challenges

JSW Group's strategy for developing the innovation area constitutes a response to the changing market, technological and regulatory conditions in which a modern extractive-industry enterprise must operate.

Given the globalisation of trade in coking coal and coke, being the EU leader in their production does not shield JSW Group from challenges brought on by the market environment, rather forcing us to become a company that sets development directions for the entire industry.

The mining sector's key challenges include a reduction in production costs by improving operational efficiency, continuous improvements in product quality and incorporating challenges related to safety, environmental protection and social responsibility in all aspects of the business. Mining companies' notion of social responsibility as regards occupational safety and environmental protection is aided by the ever stricter legal requirements, which also contribute to the need to develop modern technologies for the mining and producing of coal and coke.

Business development understood as building JSW Group's value based on diversified operations, spanning both the core business and supporting activities, requires constant reviewing and evaluating of the available technologies and investing in new research directions. New challenges for us are mainly related to the European Commission's European Green Deal, which sets out ambitious targets for reaching the EU's climate neutrality.

These targets require the Group to undertake strategic activities in line with the relevant perspectives, which constitute an opportunity for sustainable development in the following areas:

  • circular economy,
  • eenergy efficiency and reduction in environmental impact through optimal use of own energy resources.

One of the key strategy elements is the digitalisation of production and technological processes in the coke extraction and production area. JSW Innowacje - JSW Group's research and development arm - aside from increasing efficiency in coal mining and coke production is also working on modern solutions related to resource and waste management and innovative solutions for the rehabilitation of JSW Group's post-industrial land.

In order to clearly define all tasks and processes related to R+D+I projects, JSW Group has an R+D+I Policy in place, which:

  • describes the process for commencing, conducting, reporting and financing R+D+I projects at JSW Group,
  • indicates documents based on which the process for commencing, conducting, reporting and financing R+D+I projects at JSW Group is performed,
  • identifies organisational units involved in processes: commencing, conducting, reporting and financing R+D+I projects at JSW Group,
  • defines competences and scopes of responsibility for each organisational unit involved in JSW Group's R+D+I processes.

Strategic assumptions

Implementation of the R+D+I Strategy's assumptions is based on three pillars:

  • Coordination of innovative activities,
  • Securing sufficient funding from internal and external sources,
  • Cooperation with domestic and international innovation ecosystems.

Innovations are implemented in four key thematic areas:

Performance

Quality

Safety

Social and environmental responsibility

The Strategy is being implemented through the following activities:

  • Conducting research and development projects in cooperation with external partners,
  • Coordinating pre-implementation works necessary for introducing new technologies to the Group's operations,
  • Commercialising the effects of completed innovative projects with strong market potential,
  • Initiating and supporting activities that are building an innovation culture.

R+D+I projects are divided into three categories: strategic, innovative and local projects.

STRATEGIC PROJECTS, in which case JSW Group companies' investment is estimated at PLN 5 million or more.

Selecting and initiating strategic projects takes place at JSW S.A.'s Development Office. Strategic projects are prepared and managed by JSW Innowacje. The Committee for Evaluating Strategic Innovative Projects issues recommendations to launch strategic projects and move them past decision gateways, while final decisions are made by JSW's Management Board. Strategic projects are financed using funds allocated in JSW Group's technical and economic plan or from an R+D+I provision.

Reporting is based on monthly information on project status for JSW Innowacje's Management Board and JSW's Strategy and Development Office as well as quarterly reports on project progress from JSW Innowacje's Management Board to JSW's Management Board.

INNOVATIVE PROJECTS, in which case JSW Group companies' investment is estimated at between PLN 0.25 million and PLN 5 million. Innovative Projects also include projects where JSW Group companies' investment is lower than PLN 0.25 million but where more than one of the Group's companies or business units are involved.

Innovative projects are selected, initiated, prepared and managed by JSW Innowacje. The Preliminary Committee for Evaluating Innovative Projects issues recommendations to launch innovative projects, while the Committee for Evaluating Innovative Projects issues recommendations to move them past decision gateways, and final decisions are made by JSW Innowacje's Management Board.

Innovative projects are financed on the basis of a framework agreement between JSW and JSW Innowacje. Reporting is based on monthly information on project status for JSW Innowacje's Management Board and quarterly reports on project progress from JSW Innowacje's Management Board to JSW's Management Board.

LOCAL PROJECTS, the value of which is estimated at below PLN 0.25 million and which are implemented by a JSW Group company or business unit.

Local R+D+I projects are selected, initiated, prepared and managed by JSW Group Entities and companies with the participation of JSW Innowacje representatives based on decisions by the management boards of such companies or Entities, taking into account recommendations from the Preliminary Committee for Evaluating Innovative Projects and the Committee for Evaluating Innovative Projects.

In 2019, works on an R+D+I knowledge management system were initiated and analysis was conducted on the degree to which JSW Group's R+D+I Strategy was implemented and how effective it was.