SO2-8
An important part of the Group’s strong corporate culture, the global Ethics Program encompasses both ethics training for employees and a whistle-blowing system – the Electrolux Ethics Helpline.
The Ethics at Electrolux program is designed to help employees translate into action Group expectations for personal and corporate accountability. It encompasses several tools, including a guidance booklet, an intranet site and mandatory e-learning. The program also includes the Ethics Helpline in local languages through which employees can confidentially register incidents of non-compliance to codes and policies.
The program was introduced during 2011 and rolled out region by region. A few final countries have yet to complete the rollout.
Through the Ethics Helpline, employees can report suspected misconduct in local languages, either through a call center or via a web portal. In most cases, reporters have the option to submit complaints anonymously. In a few countries however, local legislation requires reporter identification.
The Helpline is hosted by an external provider who submits reports to a group of designated representatives from Group Sustainability Affairs, Human Resources, Legal and the internal auditing Management Assurance and Special Assignments (MASA) functions. After an initial review, the issue is investigated further by personnel trained to uphold principles of confidentially, independence and efficiency.
Reports that are substantiated are mitigated and may lead to the following actions:
In 2014, 119 reports were recorded through whistle-blowing system. 27 cases were deemed beyond the scope or lacking information to enable an investigation 92 reports led to investigation.
The majority of reports relate to discrimination and harassment, such as use of abusive language or similarly disrespectful behaviour. Confirmed misconduct generally resulted in warnings and retraining. In a few and serious cases, the report has led to termination of employment. A proportion of reports fall under ‘Other’. These include for example breaches of working hours policy, unfair promotion practices, irregular expense reporting - or are a mix of several of the reporting categories.
The Ethics Program, including the Ethics Helpline, is an important tool to build and maintain the corporate culture of ethics and integrity, diversity and respect for one another. The program has operational benefits as well. By identifying misconduct where it occurs and ensuring it is appropriately addressed, the Group is reducing and avoiding indirect costs stemming from interpersonal conflicts, potential absence from work and even loss of talent.
The next steps are:
| 2014 | |
| Discrimination & harassment | 46 |
| Other | 34 |
| Conflict of interest | 11 |
| Business integrity | 5 |
| Environment | 3 |
| Safety | 2 |
Note: Business integrity: Corruption, bribery, anti-trust, securities violations, political donations, misuse of company assets.
An Antitrust Policy and guidelines were launched in 2012 and the Group’s Corruption and Bribery Policy and guidelines were re-launched. These have since the launch been supported by in-person training on antitrust and anticorruption for selected employees representing all regions in functions such as sales, marketing and procurement. Additionally, Electrolux in North America offers training on various policies in regards to compliance to related US legislation.
Electrolux has policy positions at Group level on strategic issues such as supporting market incentives that help consumers purchasing energy efficient appliances. Public policy initiatives are primarily conducted through industry organizations such as the European Appliance Industry Association (CECED) and the American Home Appliance Manufacturers Association (AHAM).
EU legislation on recycling (WEEE) and chemicals (REACH and RoHS) is influencing legislators from other regions such as China and the United States. At the same time, performance standards and legislation vary between regions of the world, a challenge for companies active in many markets. Electrolux therefore supports global harmonization of measurement standards needed for legislation to evaluate the performance of products.
With the shift from local to global marketplaces and product offerings as well as from national or regional regulation towards globally harmonized standards comes the increasing need to streamline the Group’s public policy efforts. From January 1st 2015 Electrolux has in place a global coordinator for external affairs and will investigate how to align external affairs activities. This is especially relevant for regulations regarding chemicals and energy efficiency.
Public policy issues relevant to Electrolux across its markets include:
The policy work is based on the Group ambition on sustainability.
Electrolux in Australia has been active in the public policy arena and worked closely with the Australian government on the revised IEC refrigerator performance standard, recently published as an International Standard. Further engagement by Electrolux has provided support for the introduction of demand response management of appliances, particularly air conditioners and water heaters. Electrolux contributed to a feasibility study for efficiency requirements for portable air conditioners, leading to revised test standards. Finally, the company was engaged in establishing new efficiency levels for refrigerators to be launched in 2017 - including participation in testing.
Electrolux engages with officials of the EU Commission, Members of the EU Parliament and the Council of Ministers regarding the issues mentioned below. Electrolux is registered through the EU’s voluntary transparency register, managed by the EU Commission, confirming that Electrolux European Affairs has a staff of three and annually invests SEK 2.6 - 3.0m (EUR 300,000 - 350,000) in public policy activities.
Legislation and EU policy initiatives of relevance include:
During 2014, activities included:
In 2013, the EU adopted legislation introducing an energy label for vacuum cleaners, In addition legislation came into force in 2014 that limits the input power of vacuum cleaners, and sets a minimum durability stipulation for vacuum cleaner motors together with a requirement for dust pick-up. A new energy label for ovens and [cooker] extractor hoods applies form January 2015 and the first step in minimum efficiency limits applying to ovens, hobs and [cooker] extractor hoods comes into force in February 2015. Energy efficiency limits and energy labeling for water heaters applies from September 2015.
Electrolux regards the energy label as a positive tool to increase transparency for consumers and push the market towards more energy efficient and better performing appliances. At the same time, energy efficiency limits remove the least efficient products from the market.
Public policy work is mainly conducted through AHAM (in the Group’s capacity as an Energy Star partner and in dialog with the US Environmental Protection Agency). Through AHAM, Electrolux has been active in the development of an industry-sustainability standard for refrigerators and washing machines as well as portable and floor care products. Similar standards are expected for dishwashers and cooking products in 2015. Standard development has begun for clothes dryers and microwave ovens and it is expected they will be completed in 2015. The Group has also been engaged in the introduction of recycling schemes for the implementation of producer responsibility regulation across Canadian provinces. Electrolux supported AHAM’s, stance on proposed producer responsibility regulation in New York. As a result of negotiations with New York, a compromise agreement has been reached between the industry and New York and the NYC regulations will be finalized in 2015.
Electrolux does not make political contributions, including donations to politicians or political parties. There may, however, be occasions where Electrolux will support proposals made by a political party on a particular issue, for example, when legislation is under discussion. Employees who engage in dialog with governments and other public bodies to inform or influence public policy must do so responsibly and transparently, making it clear at all times that they represent Electrolux. A limited number of dedicated employees are authorized to engage in dialogue with policy makers.
Potential non-compliance, disputes or items that pose a material financial risk are reported to Group level in accordance with Group policy.
Please see Annual Report, Contingent liabilities of material impact to the business.