Disclosures on management approach Disclosures on management approach

GRI report

Disclosures on management approach

Disclosure of management approach is reported by the generic management approach covering Kemira’s corporate responsibility in general, and by the specific management approaches covering each focus area of corporate responsibility. The management approach of economic performance is covered by Kemira's corporate governance and financial guidance. Sustainable organic growth, financial stability and target oriented corporate responsibility work are the key elements in Kemira’s management of economic responsibility.

Management approach of Kemira's corporate responsibility
Description of management approach At Kemira, the purpose of Corporate Responsibility is to identify, understand and manage the impacts of our activities on the environment, people and the society.   
Policies Kemira has a wide scope of company policies that support the implementation of corporate responsibility targets, and that relate to the management approach of each corporate responsibility focus area.

   
Commitments
  • Kemira Code of Conduct is in line with the OECD Guidelines for Multinational Enterprises 
  • Kemira respects and complies with internationally acknowledged human rights such as the United Nations Universal Declaration of Human Rights and ILO declaration on Fundamental Principles and Rights at Work
  • Kemira is signatory of Responsible Care, the voluntary initiative of the international chemical industry.
   
Goals and targets Our corporate responsibility targets can be found in the section Our focus areas.   
Responsibilities Director, Corporate Responsibility, is responsible for overall development and management of corporate responsibility activities, and reports to SVP, Communications and Corporate Responsibility, a direct subordinate of the CEO.  

Corporate Responsibility team
  • Team is lead by Director, Corporate Responsibility
  • Team is responsible for management of a company-wide process to identify corporate responsibility priorities and targets, coaching and supporting the organization,  coordinating, monitoring and reporting of the corporate responsibility related activities in Kemira, establishing the processes, tools and metrics to ensure compliance with relevant external norms, guidelines and expectations, stakeholder dialogue related to corporate responsibility, public affairs issue management
  • Team responsibilities are connected to performance evaluation and incentive plan: 30% of bonus targets are based on individual KPI’s to ensure that corporate responsibility targets are implemented and achieved. For corporate responsibility, generic catalog KPI’s are defined which can be used as part of bonus KPI’s in other parts of the organization

Corporate Responsibility management team
  • Team is chaired by Director, Corporate Responsibility
  • Team members are from the organisational units that are responsible for implementation and business integration of the corporate responsibility targets
  • Team members are responsible for the management and performance follow-up of target implementation in their respective organizational unit
  • Team is responsible for proposing target updates and KPI’s to Kemira’s Management Board and performance reporting
  • Responsibilities are largely connected to performance evaluation. For details, see DMA by focus areas
   
Resources Segments and functions (Legal, Sourcing and Procurement, Supply Chain Management, EHSQ, Manufacturing, Human Resources, Communications and Corporate Responsibility.   
Specific actions (processes, programs, projects, initiatives) Corporate level, global activities:
  • Stakeholder engagement surveys conducted on regular basis
  • Target-setting and performance management according to corporate responsibility management process
  • Corporate responsibility reporting on quarterly and annual basis
   
Evaluation of management approach Kemira’s Managemet Board annually reviews and approves the corporate responsibility targets. The approved targets and the corporate responsibility report are presented and discussed with the Board of Directors. 

The performance follow-up of target implementation is conducted every quarter, and the results are reported to the Management Board, as well as to stakeholders in the quarterly Kemira Interim Reports.

Mechanisms for monitoring the effectiveness of the management approach   

  Audit coverage of corporate responsibility areas in 2013
 Assurance unit Economic Environmental Social
Internal assurance      
Kemira Internal Audit Evaluation of internal controls:
Reliability of financial reporting, effectiveness and efficiency of operations
  Evaluation of internal controls:
Compliance with applicable laws and regulations
Supply Chain Management  Supplier performance management  Supplier performance management Supplier performance management
Environment, Health, Safety and Quality   Management system audits, site-specific EHS audits Management system audits, site-specific EHS audits
Product Stewardship and Regulatory Affairs     Product regulatory compliance at manufacturing sites
 External assurance      
External certification partner for quality, environmental and safety management systems   Assessing and auditing of environmental management systems by ISO 14001 Assessing and auditing occupational health and safety management systems by ISO 18001 and quality management systems by ISO 9001
External service provider for legal compliance auditing   Legal compliance audits Legal compliance audits
External service provider for financial auditing Assessing and auditing financial statements    
External service provider for corporate reporting assurance   Assessing and auditing the management and performance of environmental responsibility according to GRI Assessing and auditing the management and performance of social responsibility according to GRI
 Improvements in management approach in 2013: 
  • Management Board is more involved in the discussion concerning corporate responsibility topics, and this activity is expected to increase in the coming years
  • Board of Directors level discussion on corporate responsibility focus areas and targets once a year
  • Performance results of corporate responsibility targets are disclosed quarterly to the Management Board, and to stakeholders in the Kemira Interim reports
  • Corporate Responsibility management team has regular meetings with preagreed annual agenda and one focus area per meeting
  • More active in external benchmarking (CDP, DJSI)
  • Sustainability risk assesment is more closely integrated into Kemira Enterprise Risk Management process (e.g. climate risk)
  • Overall global management process definition for corporate responsibility has been more specifically defined in 2014
Management approach by focus areas
Focus area: Responsible business practices
Material aspects and reported indicators
(Note: materiality is described in G4-18)
  • Anticorruption (SO3, SO4, SO5)
  • Public policy (SO6)
  • Anticompetitive behaviour (SO7)
  • Compliance (SO8) (EN29 by EHSQ, PR9 by PSRA)
  • Grievance mechanism (EN34, LA16, HR12, SO11)
       
Description of management approach The management of responsible business practices forms the basis for Kemira to conduct its business: ethically and in compliance with applicable laws, regulations and Kemira’s own policies throughout the organization.       
Policies
  • Kemira Code of Conduct (2012)
  • Competition Law Compliance Policy (2006)
  • Group Gifts, Entertainment and Anti-bribery Policy (2012)
  • Group Sponsorship and Donation Policy (2013)
  • Group Related Party Policy (2012)
  • Risk Management Policy (2010)
  • Business Control Manual (2009)
  • Business Agreement Policy (2013)
  • Legal Review Guidelines for Business Agreements (2013)
  • Kemira Oyj Procuration Policy (2013)
  • Kemira Group Policy for Issuing and Maintaining Policies (2013)
  • EHSQ policy (2013) – foundation for management systems

The Kemira Code of Conduct requires compliance with laws and regulations and adherence to company policies by every company employee. Kemira has a zero tolerance policy with regard to breaches of competition law and does not tolerate any corruption or bribery. Kemira and its employees must never offer, solicit or accept a bribe in any form.

Kemira does not accept financial support to politicians, political parties or political organizations. The main channels for Kemira to contribute to public policy development are by contributing to the work of relevant trade and industry associations.

       
Goals and targets
  • Training of employees for the Kemira Code of Conduct (CoC)
  • Development of Kemira Compliance Program including Communication, Training and managing the Kemira  Ethics & Compliance hotline.

See details in the table Corporate responsibility targets in the section Our focus areas.

       
Responsibilities
  • Head of Legal function aswers for the compliance program, responsible business conduct and grievance mechanism. Responsibilities are connected to performance evaluation and incentive plan with the KPI “Secure that Kemira is at the end of 2013 fully compliant with Code of Conduct”
  • Director, Ethics and Compliance (Legal function) is responsible for the Kemira Compliance program and for grievance mechanism. Responsibilities are connected to performance evaluation and incentive plan with the KPI “All Kemira emplyees trained by Dec 31, 2013”
  • Head of EHSQ (Environment, Health, Quality and Safety) is responsible for auditing, and recognizing gaps versus safety/environmental legal requirements and internal standards, and to work as experts together with Kemira’s organization to fill the gaps
  • Head of PSRA (Product Stewardship and Regulatory Affairs) is responsible for product regulatory compliance
       
Resources
  • Legal function is responsible for the development and implementation of the Kemira compliance program. Legal/Ethics and Compliance is responsible for grievance mechanism.
  • EHSQ is responsible for leading the EHSQ Community and to develop and maintain Kemira’s EHSQ vision, strategy and development roadmaps for the segments and functions within Kemira.
  • PSRA function is responsible for safety documentation and product registrations processes and implementation.
  • Line organizations are accountable and responsible for EHSQ  and product safety compliance within their organizations. Line organizations are accountable and responsible for EHSQ  and product safety within their organizations.
       
Specific actions (processes, programs, projects, initiatives)  Corporate level, global activities:
  • Code of Conduct training provided for all employees during 2013
  • Ethics and Compliance hotline was launched and made available to all Kemira employees in 2013
  • Kemira Group Compliance program has been initiated to further develop compliance management
  • New EHSQ vision, policy, strategy 2013–2020, new targets 2013–2020, new set of KPI’s and five standards developed in 2013
       
Evaluation of management approach Improvements in management approach in 2013:
  • Organizational role and position, Director Ethics and Compliance established
  • Sustainability topics in greater role in the agenda of Kemira Internal Audit
  • EHSQ: Several new KPI’s introduced and monitored and integrated management system introduced in Europe
       
Focus area: Responsible supply chain
Material aspects and reported indicators
(Note: materiality is described in G4-18)
  • Supplier assessment (EN32, LA14, HR10, SO9)
  • Emissions (EN17) – Scope 3 related to supply chain
  • Transport (EN30)
       
Description of management approach Management approach is intended to minimize negative economic, environmental and social impacts, and develop responsible business practices in the supply chain.       
Policies
  • Kemira Code of Conduct (2012)
  • Code of Conduct for Suppliers, Distibutors and Agents (2012)
  • EHSQ policy (2013)
  • Sourcing & Procurement Policy (2012)
  • Kemira Global Travel Policy (2010)
       
Goals and targets
  • Code of Conduct for Suppliers, Distributors and Agents (CoC-SDA)
  • Supplier performance evaluation program

See details in the table Corporate responsibility targets in the section Our focus areas.       
Responsibilities
  • Head of  Sourcing and Procurement is responsible for the implementation of the Code of Conduct for Suppliers, Agents and Distributors (CoC-SDA), suppliers performance evaluation program and the Scope 3 part for business travel. Responsibilities are connected to performance evaluation and incentive plan with KPI related to Supplier Relationship program including Supplier Performance Evaluation and supplier assessments.
  • The negotiating Sourcing Managers, who are in contact with the suppliers, have the responsibility to systematically discuss the sustainability related topics with the business partners. Responsibilities are connected to performance evaluation and incentive plan with following KPI’s:
  • Training has been organized on how to implement CoC-SDA on purchase orders and contracts
  • CoC-SDA is posted on the Kemira web page as well as at Kemira intranet
  • CoC-SDA is attached to contracts that can be found on Harmony, Kemira contract database
  • Head of logistics is responsible for transportation EHS, and Scope 3 for transportation
       
Resources
  • Sourcing & Procurement (in Finance and Accounting function)
  • Supply Chain Management function
       
Specific actions (processes, programs, projects, initiatives) Corporate level, global activities:
  • Introducing the Code of Conduct for Suppliers, Distributors and Agents to all new and renewed contracts
  • Supplier Performance Evaluation (SPE) program initiated
  • Supplier assessments as part of the SPE program initiated to cover the most critical and risky vendors
       
Evaluation of management approach Improvements in management approach in 2013:
  • CoC-SDA published and incorporated in all relevant supplier relationships
  • Supplier Performance Evaluation (SPE) process initiated
  • Head of Sourcing and Procurement personally involved
       
Focus area: Responsibility for employees
Material aspects and reported indicators
(Note: materiality is described in G4-18)
  • Employment (LA1, LA2)
  • Labor/management relations (LA4)
  • Occupational health and safety (LA6)
  • Training and education (LA9, LA10, LA11)
  • Diversity and equal operation (LA12)
  • Equal remuneration for women and men (LA13)
  • Non-discrimination (HR3)
  • Freedom of association and collective bargaining (HR4)
  • Human rights assessement (HR9)
       
Description of management approach Management approach is to ensure that Kemira has the necessary know-how, strong leaders and engaged people to successfully execute its strategy. Focus is on enhancing positive impacts on human capital and respect on human rights, and to avoid, mitigate, or remediate any negative social impacts on labor practises, decent work and human rights.       
Policies and commitments Policies
  • Kemira Code of Conduct (2012)
  • EHSQ policy (2013)
  • Group Compensation Approval Policy (2013)
  • Group Recruitment Policy (2013)

Commitments
  • Kemira's approach to labor practices and human rights is guided by the Kemira Code of Conduct which is in line with the OECD Guidelines for Multinational Enterprises
  • Kemira respects and supports the fundamental human rights as defined in the United Nations Universal Declaration of Human Rights
  • Kemira complies with the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work.
       
Goals and targets
  • Performance management
  • Leadership development
  • Employee engagement
  • Occupational health and safety

See details in the table Corporate responsibility targets in the section Our focus areas.       
Responsibilities
  • VP, Talent Development, is responsible for talent and leadership development as well as employee engagement. Responsibilities are connected to performance evaluation and incentive plan with a KPI related to leadership and talent management
  • Director, Compensations and Benefits is responsible for performance management process. Responsibilities are connected to performance evaluation and incentive plan with a PDD coverage KPI
  • Head of EHSQ (Environment, Health, Quality and Safety) is responsible for auditing and recognizing gaps versus safety/environmental legal requirements and internal standards, and to work as experts together with Kemira’s organization to fill the gaps. Responsibilities are connected to performance evaluation and incentive plan with the KPI “EHSQ vision, policy and standard development”
       
Resources Human Resources function
EHSQ function – occupational safety
Line organizations are responsible and accountable for EHSQ  and product safety within their organizations
Specific actions (processes, programs, projects, initiative Corporate level, global activities:
  • Performance and development discussions (PDD) established as an elemental part of the performance development process. Regular performance and career development reviews (PDDs) are in place in all countries where Kemira is present
  • Leadership development: Leadership position requirements have been defined as part of Kemira’s job architecture. Leadership competencies have been defined for all three leadership levels. Leadership assessment for senior and mid-level leaders has been designed and implemented, resulting to a development of a leadership development  portfolio which is being implemented according to annual plan
  • Employee engagement: Global employee engagement survey is in place and organized every 2 years. Action plans based on the results are being developed.
  • Occupational safety: Kemira aims at having all of its sites certified in accordance with the OHSAS 18001 standard. At the end of 2013, OHSAS 18001 certification covered globally 55% of all locations and 69% of all manufacturing sites
  • New EHSQ strategy, ‘Kemira Care initiative’, is under implementation.
       
Evaluation of management approach Improvements in management approach in 2013:
  • HR management’s role and responsibilities related to social responsibility clarified
  • Global processes for employee related data management established. Tools enabling consistent execution of people processes (e.g. talent management, learning management, compensation management) are being implemented
  • Introduced standards to improve safety of employees
  • Measuring TRI for both Kemira employees and contractors
       
Focus area: Responsible manufacturing
Material aspects and reported indicators
(Note: materiality described in G4-18)
  • Materials (EN1, EN2)
  • Energy (EN3, EN5, EN6)
  • Water (EN8, EN10)
  • Emissions (EN15, EN16, EN18, EN19, EN20, EN21)
  • Effluents and waste (EN22, EN23; EN24; EN25)
  • Environmental expenditures and investments (EN31)
  • Environmental compliance (EN 29)
       
Description of management approach Management approach is intended to avoid, mitigate, or remediate negative impacts of Kemira’s manufacturing operations on the environment and climate, and enhance positive impacts on society.       
Policies
  • Kemira Code of Conduct (2012)
  • EHSQ policy (2013)
  • Internal EHSQ management guidelines in place at most of the European plants
       
Goals and targets
  • Climate change target introduced
  • Water efficiency targets

See details in the table Corporate responsibility targets in the section Our focus areas.

In addition to the corporate responsibility targets set on the Group level, Kemira sets environmental targets at the plant level.       
Responsibilities
  • Head of manufacturing at each segment is responsible for energy and water efficiency, reductions of emissions and waste, effective usage of materials and safety. Responsibilities are connected to performance evaluation and incentive plan with KPI’s related to occupational and process safety and energy efficiency
  • Head of EHSQ (Environment, Health, Safety and Quality) is responsible for auditing, and recognizing gaps versus safety/environmental legal requirements and internal standards, and to work as experts together with Kemira’s organization to fill the gaps. Responsibilities are connected to performance evaluation and incentive plan with the KPI “EHQS vision, policy and standard development”
  • Sourcing and Procurement / Sourcing managers are responsible for purchasing of materials
  • Sourcing and Procurerement is responsible for purchasing of energy.
       
Resources Manufacturing units, Sourcing and Procurement function, Supply Chain Management, EHSQ function, line organization in manufacturing sites       
Specific actions (processes, programs, projects, initiatives)  Corporate level, global activities:
  • E3 Energy Efficiency Enhancement program
  • LEAN manafacturing project  was established to improve manufacturing efficiency and reduce waste (waste in this case means unnecessary extra resources, bureaucracy and time)
  • Certification of manufacturing sites continues. Kemira aims to have all sites certified in accordance with the ISO 9001, ISO 14001 and OHSAS 18001 standards. At the end of 2013, the coverage of certified manufacturing sites was:
       
    ISO 9001 ISO 14001 OHSAS 18001
  Total # % # % # %
Manufacturing 59 48 81 44 75 41 69
EMEA 32 30 94 28 88 25 78
North America 22 14 64 14 64 14 64
South America 3 3 100 2 67 2 67
APAC 2 1 50 0 0 0 0
  • Process safety standard developed in 2013 and will be launched in 2014
       
Evaluation of management approach Improvements in management approach in 2013:
  • Manufacturing community and EHSQ community were established to facilitate collaboration across organizations units and countries
  • Introduction of five new EHS standards in 2013 and more standards to be introduced in 2014
       
Focus area: Sustainable products and solutions
Material aspects and reported indicators
(Note: materiality is described in G4-18)
  • Products and services (EN27, EN28)
  • Customer health and safety (PR1, PR2)
  • Product and service labelling (PR3, PR4)
  • Marketing communication (PR6)
  • Product compliance (PR9)
       
Description of management approach Management approach is intended to enhance positive indirect impacts of Kemira’s products, and to avoid, mitigate, or remediate negative impacts on environment, people, and society over the whole product life-cycle. The aim is to ensure that all of Kemira’s products are safe for Kemira's employees, value chain partners and customers, and that appropriate registration, documentation, and labeling is provided.        
Policies Kemira Code of Conduct (2012)
Employee invention policy (2009)
Policy on intellectual property rights (2009)
Guideline for trademark use and registration (2011)
EHSQ policy (2013)       
Goals and targets Sustainability aspects to be evaluated in 100% of New Product development (NPD) projects by the end of 2015

See details in the table Corporate responsibility targets in the section Our focus areas

Other goals: 100% compliance with product regulatory requirements       
Responsibilities
  • Senior Manager Process development, R&D and Technology is responsible for NPD process development. Responsibilites are connected to performance evaluation and incentive plan with the KPI of R&D projects completed as planned (including sustainability checks made at each Gate of the NPD process)
  • Head of PSRA (Product Stewardship and Regulatory Affairs) is responsible for necessary documentation for product registrations and regulatory compliance
       
Resources
  • The R&D and Technology function is responsible for all R&D activities in Kemira Group and coordinates the NPD process activities across organizational units.
  • PSRA function is responsible for necessary documentation for product registrations and regulatory compliance.
       
Specific actions(processes, programs, projects, initiatives)  Corporate level, global activities:
  • Sustainability criteria defined and implemented in the New Product Development (NPD) process.
  • Sustainability reviews required at every stage of the New Product Development (NPD) process before proceeding to the next stage in order to ensure that all sustainability criteria are identified at the earliest stage. The process also aims to identify less hazardous and more sustainable alternatives for raw materials.
  • Product regulatory compliance according to all relevant legislations such as REACH (Registration, Evaluation, Authorization and Restriction of Chemicals), and GHS (Globally harmonized System of Classification and Labelling of Chemicals).
       
Evaluation of management approach Improvements in management approach in 2013:
  • Sustainability criteria of NDP process being developed, training of project teams for sustainability evaluation
  • “One label”- project initiated to ensure compliance with upcoming GHS classification
  • Site audits for material safety data initiated
  • PSRA and EHSQ reporting to the same EVP for total safety management
  • Improvement of Kemira’s ERP system initiated to ensure improved product safety data management
       
Focus area: Responsibility towards the local communities where we operate
Material aspects and reported indicators
(Note: materiality is described in G4-18)
Local communities (SO1, SO2)       
Description of management approach The management approach is intended to create a positive image of Kemira’s operations in the communities where we operate. Focus is on ensuring that Kemira has a continuous dialogue with local communities to understand and have activities in place to respond to their needs, concerns and expectations, and providing opportunities for Kemira employees to participate in local community initiatives.       
Policies Kemira Code of Conduct (2012)
Group Sponsorship and Donation Policy (2013)
EHSQ policy (2013)       
Goals and targets The responsibility target of community involvement is that by 2015, each Kemira siteemploying over 50 people would have participated in a local community involvement initiative at least once.

See details in the table Corporate responsibility targets in the section Our focus areas       
Responsibilities
  • Site management is responsible for local activities
  • Communication & Corporate Responsibility function is responsible for global guidelines, coordination and reporting
Responsibilities are connected to performance evaluation in some regions.       
Resources All Kemira operating sites       
Specific actions (processes, programs, projects, initiatives) Corporate level, global activities:
  • Activities are coordinated globally on Kemira Group level but activities are planned and implemented locally on site level.
  • Some examples of local activities are open house days for community residents at manufacturing sites, cooperation with local schools and universities, local sponsorships and donations.
       
Evaluation of management approach  Improvements in management approach in 2013:
  • Global guidance developed for activity planning of local community events
  • Group Sponsorship and Donation Policy (2013)