Standards, standards, standards by Article 13

ARTICLE 13 ORANGE PAPER

Standards, standards, standards Article 13

ARTICLE 13 ORANGE PAPER

Since 1998, we have reviewed, researched and commented on the social, environmental, economic, and ethical trends shaping organisational performance (public and private sector). This research - ‘Article 13 Orange Papers’ - represents our commitment to the dissemination of knowledge and good practice which is critical to the transition to a sustainable society. For further Article 13 Orange Papers Whilst this publication is free to view, we would welcome your recognition of our work by contributing to our chosen charity – please see our UNGC page NOTE: Article 13 Orange Papers are independent in their views and publishes articles written from a very broad spectrum of opinions. Unless stated, the views in these articles do not necessarily represent Article 13’s own views. We acknowledge all copyright featured on these papers

Article 13 “Standards, standards, standards” Document 1 – the analysis February 2003

Contents 1. Introduction 1.1. How to use these documents 1.2. The Article 13 approach 1.3. A “route map” for business 1.4. The standards 1.5. Key

3 3 3 4 5 6

2. Summary of themes 2.1. Summary grid of themes 2.2. Overarching areas 2.3. Single standards area 2.4. Common constituents 2.5. Overlaps

7 7 9 9 11

3. What you need to consider 3.1. Overarching area 3.2. Single standards area

12 12 26

4. Emerging areas

5. By business functions 5.1. Human resources 5.2. Supply chain 5.3. Corporate governance 5.4. Innovation 5.5. Risk management

34 34 34 35 35 35

Article 13 “Standards, standards, standards” Document 1 – Analysis

1. Introduction 1.1. How to use these documents Article 13’s standards work comprises two documents •

Document 1: An analysis of the standards – what, why, how and who

•

Document 2: All the detailed background information on the standards

Why? Traditionally led by the need for compliance and keeping up with new laws on environmental and social issues, the whole area of business responsibility and sustainable development has increasingly been linked to business benefit. Article 13 has always worked from the premise that engaging with these issues can not only ensure compliance but also add value to an organisation and deliver to organisational objectives and strategy. In Document 1 you will find a summary of all the areas and ‘sub-areas’ that these standards cover. We have listed what you need to consider for each of these and also sorted them by business function. This gives a different perspective, and enables quick reference to all the issues that say, a human resources manager, may need to look at when addressing these issues. Document 2 reviews in detail each standard referred to Document 2. We list the standards’ mission and scope, whether they have a stakeholder focus, best practice and what you need to look at.

1.2. The Article 13 approach Where to start? 1. 2. 3. 4. 5.

What are your business objectives and strategy? What are the critical issues you need to resolves to achieve those objectives? Who do you need to “help” you achieve those objectives? How will you know when you have achieved them? Why do you want to get involved in CSR? What are the drivers?

Building a business specific toolkit 1. Consider the standards as a toolkit to help you achieve your objectives 2. Match the issues (point 2) and people (point 3) you have identified in “where to start” (above) with the relevant ‘themes’ from the standards (following pages) 3. Identify relevant measures of success for these themes from those standards Selecting a single standard to use or a combination of standards 1. Consider if there are standards that seem to cover most of your issues 2. Check if your industry is using the same one. If not, why not? 3. Consider using your selected standard(s) as a framework to report your progress and achievement

Article 13 “Standards, standards, standards” Document 1 – Analysis

1.3 A “route map” for business Business Objectives

What could “stop” us getting there?

What could “help” us get there?

Key issues we need to address But who do we need to consider them?

Supply chain, see page 34

Human Resources, see page 34

What does business need to demonstrate to society?

Environment*

Social*

Innovation, see page 35

Corporate governance, page 35

Risk management, see page 35

Business interface with society What does society want evidence of?

Economic*

Society interface with business

Ethical

Human Rights

What is “society” looking for?

*Economic, Social and Environmental are often the three key constituents of sustainable development

Article 13 “Standards, standards, standards” Document 1 – Analysis

1.4 The standards What is a ‘standard’? A standard can be thought of as a document which describes a benchmark of behaviour for organisations, who can then use it to improve their performance in a recognisable way. Broadly, the term ‘standard’ can be applied to a variety of documents, as shown by the groupings below: indices, standards, guidelines, process standards, and commitments. We have also added some legal and regulatory ‘documents’ which also impact upon the organisations “do business”. The ‘standards’ that we have reviewed: A. The Indices 1. FTSE4Good – Series of Indices 2. DJSI – Series of Indices B. The Guidelines 3. ABI – Report and Recommendations 4. GRI – Reporting Guidelines 5. OECD Guidelines for Multinational Enterprises 6. Just Pensions – Guide for Trustees and Fund Managers 7. SIGMA Guidelines 8. UK CSR – DTI Society and Business Report 2002 9. EU CSR – Green Paper “Promoting a European Framework for Corporate Social Responsibility” and EUCSR – A business contribution to sustainable development C. Commitments 10. Global Sullivan Principles 11. UN Global Compact 12. GoodCorporation Charter 13. Amnesty International Human Rights Principles for Companies 14. The London Principles D. Processes 15. AA1000 – Process Standard 16. The Natural Step E. Benchmarking 17. London Benchmarking Group 18. Bench Marks - Principles for Global Corporate Responsibility F. Standards 19. SA8000 20. ISO14001 21. ISO9001 22. ETI Base code G. Legal/Code 23. Combined Code – Principles of good governance and code of best practice 24. Core Bill 25. UK Government Company Law Review H. Business models 26. The European Foundation Quality Model – Excellence Model

Article 13 “Standards, standards, standards” Document 1 – Analysis

1.5 Key These are the abbreviations which will be used throughout the document: AA1000

AA1000 Process Standard

ABI

Association of British Insurers Report and Recommendations

AIHR

Amnesty International Human Rights Principles for Companies

Bench Marks - Principles for Global Corporate Responsibility

Combined Code – Principles of good governance and code of best practice

CLR

Company Law Review

CRB

Core Bill

DJSI

Dow Jones Sustainability Indices

EFQM

EFQM Excellence Model

ETI

Ethical Trading Initiative Base code

EUCSR

Green Paper 'Promoting a European Framework for Corporate Social Responsibility'

EUCSR1

A business contribution to sustainable development, European Union Employment and Social Affairs Directorate, EU Corporate Social Responsibility, 2002

F4G

FTSE4Good Indices

GCC

GoodCorporation Charter

GRI

Global Reporting Initiative Reporting Guidelines

GSP

Global Sullivan Principles

ISO14000

ISO9000

Just Pensions

LBG

London Benchmarking Group

London Principles

OECD

OECD Guidelines for Multinational Enterprises

SA8000

Social Accountability 8000

SIG

SIGMA Guidelines

TNS

The Natural Step

UKCSR

DTI Society and Business Report 2002

UNGC

UN Global Compact

* The Combined Code is made up of Principles and Code provisions for each principle. This analysis has captured the principles as representing overarching areas, and not considered the detail of each code provision.

Article 13 “Standards, standards, standards” Document 1 – Analysis

2. Summary of themes 2.1 Summary grid of themes Scope

Indices: FTSE -

DJSI

Guidelines: ABI

Used for evaluation by

Main themes Social

Economic

Sust Dev*

Human Rights

Stake Engage.

All links to accounting, HR, H&S, supply chain & planning

All – links to corporate governance, risk & planning

Global

Analysts (Socially Responsible Investment)

Global

Analysts (Sustainability)

UK/ Global

Fund managers & ABI

GRI

Global

NGO’s, opinion formers & other stakeholders

OECD

Global

NGO’s, opinion formers & other stakeholders

UK CSR

Business community

EU CSR

Business community and NGO’s, opinion formers & other stakeholders

Just Pensions

Trust fund managers

Sigma

Global

NGO’s, opinion formers & other stakeholders

Global

All – links to governance, risks and the board All

(Labour)

NGO’s, opinion formers & other stakeholders

Human resources, stakeholder/shareholder relations, community relations, finance, environment, health and safety, strategic and operational planning

All, particularly HR & supply chain

Global

NGO’s, opinion formers & other stakeholders

(Labour)

GoodCorporation Charter

SME business community, NGO’s, government, opinion formers & other stakeholders

Amnesty International

Global

NGO’s, government, opinion formers & other stakeholders

London Principles

Article 13 “Standards, standards, standards” Document 1 – Analysis

UN Global Compact

Investor relations, risk management, board

(Labour)

Financial community and other stakeholders

Business process/function

Env

Commitments: Global Sullivan

Measures

All, in particular HR, supply chain, environment and management -

All, particularly HR & supply chain Investor relations, risk management and the board

Scope

Used for evaluation by

Main themes Env

Process Standards

AA 1000

TNS

Benchmarking

London Benchmarking Group

Bench Marks

Standards: SA8000

Global

Economic

Sust Dev*

Human Rights

Global UK

NGO’s, opinion formers & other stakeholders

Global

NGO’s, opinion formers & other stakeholders

Global

NGO’s, opinion formers & other stakeholders

ISO 14000

Global

NGO’s, government, opinion formers & other stakeholders

ISO 9000

Global

NGO’s, government, opinion formers & other stakeholders

ETI Base Code

UK markets

NGO’s, opinion formers & other stakeholders

Legal/Code Combined Code

Government, opinion formers & other stakeholders

CORE bill

Government, opinion formers & other stakeholders

Company Law Review

Government, opinion formers & other stakeholders

Global

Business community and NGO’s, opinion formers & other stakeholders

Business process/function

through engageme nt

All

All particularly planning

Stake Engage.

NGO’s, opinion formers & other stakeholders

Business models EFQM

Social

Measures

(Community)

Community relations, public affairs, HR

All

All, particularly management, HR and supply chain

(in Labour)

All, particularly environment and supply chain

All, particularly HR & supply chain

Supply chain and procurement

All, board and senior management

* Sustainable Development: often split into and considered within its constituent parts: Economic, social and environment.

Article 13 “Standards, standards, standards” Document 1 – Analysis

2.2. Overarching areas These are headings/areas that are mentioned by more than one standard Area • Environment

Standards which mention this area

• • •

Social Economic Human Rights

•

Business Relationships, Business partners, suppliers and consumers, customers, suppliers and subcontractors Employment and industrial relations, Labour, Employees Stakeholder involvement / Stakeholder relations Community, Community engagement/involvement Health and Safety Disclosure Working hours not excessive Remuneration Child labour Partnership, co-operation, consultation Freedom of association and right to collective bargaining Freedom from discrimination Management systems Reporting Directors, Management commitment Accountability and Audit Forced Labour Relations with Shareholders People Leadership Business ethics Process approach

(DJSI)(GRI)(F4G) (ISO9000 & 14000)(LP) (DJSI)(GRI)(LP) (ABI) (EUCSR) (F4G) (GC) (GSP) (AIHR)(JP) (ABI) (EU CSR) (BM) (GCC)

• • • • • • • • • • • • • • • • • • • • •

(ABI)(DJSI)(GRI) (OECD)(GC) (ISO14001)(F4G) (EUCSR)(TNS)(SIG)(GCC)

(GC) (ABI) (OECD) (JP)(GCC) (F4G)(CC)(UKCSR) (SIG) (AIHR) (LBG) (EFQM) (ABI) (GCC) (AIHR)(GSP)(SA8000) (OECD, AIHR) (CC) (ABI) (SA8000, ETI) (SA8000)(ETI)(GSP) (AIHR)(ETI)(SA8000)(BM) (CRB)(UKCSR)(BM) (AIHR) (GSP) (ETI) (AIHR, SA8000, ETI) (SA8000)(EUCSR) (AA1000) (UK CSR) (CLR) (CRB) (JP) (CC)(CLR) (CRB) (GCC) (CC)(SIG) (SA8000)(BM)

(CC)(BM)(GCC) (EFQM) (BM) (ISO 9000) (EFQM) (ABI ) (BM) (ISO9000) (EFQM)

2.2. Single Standards areas A heading/area mentioned by just one standards Area • Combating bribery • Science and technology • Competition • Employment freely chosen • Quality of life • Consumer interests • Directors’ Remuneration • Institutional investors • Safe and hygienic working conditions

Standards which mention this area (OECD) (OECD) (OECD) (ETI) (GSP) (OECD) (CC) (CC) (ETI)

Article 13 “Standards, standards, standards” Document 1 – Analysis

• • • • • • • • • • • • • • • • • • • • •

(ETI) (ETI) (OECD) (EU CSR) (SA8000) (ETI) (AIHR) (AIHR) (AIHR) (OECD) (EU CSR) (GSP) (UK CSR) (CRB) (CRB) (CRB) (CRB) (CRB) (ISO9000) (AA1000) (UKCSR)

• • • • • •

Living wage Provide regular employment Taxation Corporate social responsibility Disciplinary practices No harsh or inhumane treatment Security Fair working conditions Freedom from slavery General policies Socially responsible investment Employee equal opportunities Driving up skills and education levels Provision of information by companies Subsidiaries, mergers Environmental and social duties of directors Liabilities of directors Corporate Responsibility Board Involvement of people Embedding Identify external concerns and relate to business Adaption to change Planning Accounting Auditing Human Resource management System approach to management

• • • • • • • • • • • • • • •

Continual improvement Factual approach to decision-making Policy and strategy Partnerships and resources Key performance results Corruption Access to medicines Conflict Establishing properly monitored policies Risk assessment Codes of Conduct Management Standards Measurement, Reporting and Assurance Labels Socially Responsible Investment

(ISO9000) (ISO9000) (EFQM) (EFQM) (EFQM) (JP) (JP) (JP) (JP) (JP) (EUCSR1) (EUCSR1) (EUCSR1) (EUCSR1) (EUCSR1)

(EU CSR) (AA1000) (AA1000) (AA1000) (EU CSR) (ISO9000)

Article 13 “Standards, standards, standards” Document 1 – Analysis

2.3. Common constituents We have pulled out from this study constituents that are common to many of the areas that the standards look at. • • • • • • • •

Management system Policy Accounting Senior person responsible Board review Stakeholder involvement Dissemination through the supply chain Partnership/co-operation/consultation

2.4. Leading linkages There are many areas of linkages, here are the main ones: • • • • • •

Between Environment and Health and Safety Between Social and Human Rights Between Social and Community Between People and Stakeholder involvement Between Reporting and Disclosure Between Business ethics and Bribery

Article 13 “Standards, standards, standards” Document 1 – Analysis

3. What you need to consider by theme and constituents When approaching the plethora of standards it is difficult to know what all the areas are and what is applicable to you. We have listed all the areas that the standards cover and the sub areas covered within these. In this we have kept very closely to the categorisation used by the standards themselves. So for example, FTSE4Good looks at equal opportunities and non-discrimination as an area under the overarching ‘social’ area, whereas the Ethical Trading Initiative Base Code and SA8000 standard consider them in more detail as distinct areas, and they are recorded as such. How to use this table: Your Question: There are so many standards that tell us what we should do about the environment, but how can I get a feel for what all these standards together are looking for evidence on under the ‘environment’ banner? Answer: See below in the ‘environment’ column where you will see all the areas that these standards recommend you consider. From this you will get an idea of which are most suited to your organisation.

3.1. Overarching Areas Environment (ABI)(DJSI)(GRI) (OECD)(GC)(GCC) (ISO14001)(F4G) (EUCSR)(TNS)(SIG)

Social (DJSI)(GRI)(F4G) (ISO9000 & 14000)(LP)

Economic (DJSI)(GRI) (LP)

Human Rights (ABI) (EUCSR) (F4G) (GC) (GSP) (AIHR) (JP)

Working towards environmental sustainability (F4G)

Social issues and stakeholder relations (F4G)

Strategic planning (DJSI)

Upholding and supporting universal human rights (F4G, GC, ABI, GSP)

Environmental policy (F4G,DJSI,ISO14001)

Social management system (F4G)

Organisational development (DJSI)

Explicit company policy on Human rights (F4G, AIHR)

Environmental management system (F4G,DJSI, OECD, ISO14001)

Social practice and performance e.g. charity (F4G)

IT management and IT integration (DJSI)

Ensure company not complicit in human rights abuses (GC, AIHR)

EMS documentation periodically reviewed, readily available, legible and dated (ISO14001)

Policy on social issues and (F4G,DJSI)

Quality management (DJSI)

Include issues such as monitoring emails, child labour and genetic testing (ABI)

Process for identifying environmental impact and considering as part of environmental objectives (ISO14001)

Social reporting (DJSI)

Risk/crisis management (DJSI)

Security arrangements (AIHR)

EMS operational control to include documented procedures, operating criteria, and relevant procedures for suppliers and contractors

Senior person responsible for social issues (DJSI)

Intellectual capital (DJSI)

Procedures for human rights impact assessment of company operations (AIHR)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Environment (ABI)(DJSI)(GRI) (OECD)(GC)(GCC) (ISO14001)(F4G) (EUCSR)(TNS)(SIG)

Social (DJSI)(GRI)(F4G) (ISO9000 & 14000)(LP)

Economic (DJSI)(GRI) (LP)

Human Rights (ABI) (EUCSR) (F4G) (GC) (GSP) (AIHR) (JP)

Environmental, health and safety reporting Environmental performance (F4G,DJSI) Public health and safety (OCED)

Conflict resolution (DJSI)

Customers e.g. monetary distribution indicator (GRI)

Programs of human rights education for staff and training for employees (AIHR)

Environmental profit and loss accounting (DJSI)

Diversity and opportunity (GRI)

Employees e.g. monetary distribution indicator (GRI)

Human rights monitoring mechanisms (AIHR)

Management structure and responsibility (ISO14001)

Indigenous rights (GRI)

Funders e.g. monetary distribution indicator (GRI)

Freedom from slavery (AIHR)

Management / Board review (ISO14001)

Product and services declaration (GRI)

Public sector e.g. monetary distribution indicator (GRI)

Policy statement on ILO Labour Standards for employees globally (F4G)

Support a precautionary approach to environmental challenges (GC), and Environment, Health and Safety (EHS) (OECD)

Advertising (GRI)

Indirect economic impacts (GRI)

Undertake initiatives to promote greater environmental responsibility (GC)

Respect for privacy (GRI)

Corporate Governance (DJSI)

Does firm explicitly incorporate the UN UDHR into its business principles and practice? (JP)

Encourage development of environmentally friendly technologies (GC)

Stakeholder involvement (DJSI)

Corporate codes of conduct (DJSI)

Are country managers required to demonstrate company action to avoid complicity in human rights violations (JP)

Minimising impact of products and processes on quality of land, air, water and ecosystems (ABI) through policies and procedures (GRI)

Layoffs / Freedom of association (DJSI)

Quality management (DJSI)

Are human rights impact assessments integrated into preinvestment risk analysis and into every business processes? (JP)

Materials (GRI)

Equal rights and nondiscrimination (DJSI)

Funders (GRI)

Is the company committed to raising human rights concerns

(ISO14001)

Senior person responsible for environment (DJSI)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Environment (ABI)(DJSI)(GRI) (OECD)(GC)(GCC) (ISO14001)(F4G) (EUCSR)(TNS)(SIG)

Social (DJSI)(GRI)(F4G) (ISO9000 & 14000)(LP)

Economic (DJSI)(GRI) (LP)

Human Rights (ABI) (EUCSR) (F4G) (GC) (GSP) (AIHR) (JP)

with host governments? (JP) Energy (GRI)

Occupational health and safety (DJSI)

Public Sector (GRI)

Water (GRI)

Standards for suppliers (DJSI)

Suppliers (GRI)

Biodiversity (GRI)

Employee satisfaction (DJSI)

Employees (GRI)

Emissions, effluents and waste (GRI)

Remuneration (DJSI)

Economic Prosperity (LP)

Effluents to water (GRI)

Employee benefits (DJSI)

Provide access to finance and risk management products for investment, innovation and the most efficient use of existing assets (LP)

Suppliers (GRI)

Employment and decent work (GRI)

Promote transparency and high standards of corporate governance in themselves and in the activities being financed (LP)

Products and services (GRI)

Training and education (GRI)

Compliance (GRI)

Labour practices (GRI)

Transport (GRI)

Human rights (GRI) (see also area Human Rights)

Certification, registration, action (ISO 9000 & 14001)

Human rights strategy and management (GRI)

Continuous improvement in EHS (OECD)(ISO14001)

Non-discrimination (GRI)

Contribute to public policy on EHS (OECD)

Child labour (GRI)

Employee education and training on EHS (OECD) (ISO14001)

Forced and compulsory labour (GRI)

Customer awareness

Disciplinary practices

Article 13 “Standards, standards, standards” Document 1 – Analysis

Environment (ABI)(DJSI)(GRI) (OECD)(GC)(GCC) (ISO14001)(F4G) (EUCSR)(TNS)(SIG)

Social (DJSI)(GRI)(F4G) (ISO9000 & 14000)(LP)

on EHS (OECD)

(GRI)

Life cycle approach to products (OECD)

Security practices (GRI)

Public disclosure on EHS impacts (OECD)

Society (GRI)

Economic (DJSI)(GRI) (LP)

Human Rights (ABI) (EUCSR) (F4G) (GC) (GSP) (AIHR) (JP)

Internal/external communication (ISO14001) Compliance with national legislation and consider international agreements (OECD)

Customer health and safety (GRI)

Natural resource management (EUCSR)

Product and services declaration (GRI)

Natural resource impact (EUCSR)

Advertising (GRI)

Global environmental concerns (EUCSR)

Bribery and corruption (GRI)

Substituting scarce materials with abundant, using mined materials effectively and reducing dependence on fossil fuels (TNS)

Political contributions(GRI)

Substitute persistent compounds with those that break down easily and using all substances efficiently (TNS)

Public policy(GRI)

Drawing resources from well-managed ecosystems, most efficient use of resources and land and caution in modification of nature (TNS)

Competition and pricing (GRI)

Implement, maintain and improve an environmental management system (ISO14001)

Corporate citizenship (GRI)

Environment management programme(s) (ISO14001)

Community (GRI)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Environment (ABI)(DJSI)(GRI) (OECD)(GC)(GCC) (ISO14001)(F4G) (EUCSR)(TNS)(SIG)

Social (DJSI)(GRI)(F4G) (ISO9000 & 14000)(LP)

Process to identify legal requirements (ISO14001)

Social Development (LP)

Procedures for emergency response situations and accidents which are regularly reviewed and include mitigation of environmental impact (ISO14001)

Exercise equity ownership to promote high standards of corporate social responsibility by the activities being financed (LP)

Monitoring and measurement procedures (ISO14001)

Provide access to market finance and risk management products to businesses in disadvantaged communities and developing economies (LP)

Economic (DJSI)(GRI) (LP)

Human Rights (ABI) (EUCSR) (F4G) (GC) (GSP) (AIHR) (JP)

Procedures for nonconformance and corrective and preventive action (ISO14001) Maintenance of system of environmental records including training records and audits results and reviews (ISO14001) EMS audit procedure (ISO14001) Use resources responsibly so needs of people can be met worldwide (TNS) Environmental charters (DJSI) Communication and consultation with communities on EHS (OECD) Environmental protection (LP) (GCC) Reflect cost of environmental/social risks in the pricing of financial/risk

Article 13 “Standards, standards, standards” Document 1 – Analysis

Environment (ABI)(DJSI)(GRI) (OECD)(GC)(GCC) (ISO14001)(F4G) (EUCSR)(TNS)(SIG)

Social (DJSI)(GRI)(F4G) (ISO9000 & 14000)(LP)

Economic (DJSI)(GRI) (LP)

Human Rights (ABI) (EUCSR) (F4G) (GC) (GSP) (AIHR) (JP)

management products (LP) Exercise equity ownership to promote efficient and sustainable asset use and risk management (LP) Provide access to finance for the development of environmentally beneficial technologies (LP) Environmental sustainability (SIG)

Business Relationships (ABI) Business partners, suppliers and consumers (EU CSR) (BM)

Employment (ABI) and industrial relations (OECD)

Disclosure (OECD, AIHR) (CC) (ABI)

Reporting (AA1000) (UK CSR) Reporting and responsibility (CLR) (CRB) (JP)

Labour (GC) Labour strategy (JP) Employees (GCC)

Customers (GCC) Suppliers and sub contractors (GCC) Operating fairly as regards suppliers (ABI)

Promoting diversity in the workplace (ABI)

Provide timely, regular and reliable information (OECD)

Prepare reports (AA1000)

Mutually beneficial supplier relationships (ISO 9000)

Providing suitable conditions, including sub-contractors’ and suppliers’ labour (ABI)

High quality standards in financial and nonfinancial reporting (OECD)

Communicate reports and get feedback (AA1000)

Business relationships (EUCSR)

Employee rights and trade unions (OECD)

Disclose basic company information (OECD)

Measure and report results (UK CSR)

Customer focus (ISO 9000)

Information on company performance and operational changes available to employees (OECD)

Provide additional info on values, business conduct and risk management systems (OECD)

Social responsibility reporting (EU CSR)

Operating fairly as regards customers (ABI)

No threat to transfer operations in case of strike (OECD)

Disclosure on remuneration policy should be included in annual report (CC)

Duty to prepare/publish reports annually (CRB)

Control of suppliers: Evaluate and select according to standard,

Standards of employee industrial relations comparable to other

Accountability and audit - Financial

Report should include information on significant financial,

Article 13 “Standards, standards, standards” Document 1 – Analysis

Business Relationships (ABI) Business partners, suppliers and consumers (EU CSR) (BM)

Employment (ABI) and industrial relations (OECD)

Disclosure (OECD, AIHR) (CC) (ABI)

Reporting (AA1000) (UK CSR) Reporting and responsibility (CLR) (CRB) (JP)

Labour (GC) Labour strategy (JP) Employees (GCC)

Customers (GCC) Suppliers and sub contractors (GCC) appropriate records, reasonable evidence and protection comparable for home workers (SA8000)

employers in host country (OECD)

reporting (CC)

social, environmental, economic impacts of its operations in past year (CRB)

Customer relationships are managed and enhanced (EFQM)

Employ local personnel and provide training (OECD)

Evaluation of governance disclosure should include all relevant factors (CC)

Report should include financial, social, environmental, economic impact assessment of any proposed activity (CRB)

Customer results (EFQM)

Ensure occupational health and safety (OECD)

Board should take regular account of social, environmental and ethical (SEE) matters (ABI)

Report should include employment policies and practices (CRB)

Perception measures (EFQM)

Abolition of child labour (OECD)

Board identifies and assesses the significant risks to company’s short and long term value arising from SEE matters (ABI)

Report should include information on taxes, payments, benefits, donations, contributions to political party (CRB)

Performance indicators (EFQM)

Eliminate all forms of forced labour (OECD)

Board has received adequate information to make this assessment director training takes account of SEE (ABI)

Report should include director’s duties (CRB)

Engaging smaller organisations (UK CSR)

Non-discrimination (OECD)

Board ensures that company has in place systems for managing significant risks, incorporating performance management systems (ABI)

Report should be made available to stakeholders (shareholders/investors, employees, communities, individuals), any regulatory body, any person with interest in report (CRB)

Suppliers (BM)

Disclose information on employer and stakeholder relationships (OECD)

Include information on SEE-related risks and opportunities and impact on business (long-short term value) (ABI)

Named board level individual with overall responsibility for overseeing the design and implementation of the policy? (JP)

Customers and consumers (BM)

Consider views of stakeholders (OECD)

Describe company risk management policies and procedures for

What level of reporting, both internal and public, is conducted? (JP)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Business Relationships (ABI) Business partners, suppliers and consumers (EU CSR) (BM)

Employment (ABI) and industrial relations (OECD)

Disclosure (OECD, AIHR) (CC) (ABI)

Reporting (AA1000) (UK CSR) Reporting and responsibility (CLR) (CRB) (JP)

Labour (GC) Labour strategy (JP) Employees (GCC)

Customers (GCC) Suppliers and sub contractors (GCC) SEE-related risks. If none reported, give reason why. (ABI) Seek to be honest and fair in relationships with suppliers and subcontractors (GCC)

Consultation and cooperation between employer and employees (OECD)

Include information about company’s compliance with its risk management policies and procedures (ABI)

Is there a feedback mechanism? (JP)

Pay suppliers and subcontractors in accordance with agreed terms.(GCC)

Enable employees to meet basic needs and capacity build (OECD)

Describe verification procedures for SEE disclosures. Verification procedure should achieve reasonable level of credibility (ABI)

Company reporting should provide accurate, accessible information at reasonable cost (CLR)

Policy not to offer, pay or accept bribes or substantial favours. (GCC)

Freedom of association and collective bargaining (GC)

Small companies only require short, simple supplementary statement (CLR)

Encourage suppliers and subcontractors to abide by the principles of this Charter (GCC)

Elimination of all forms of forced and compulsory labour (GC)

Abolish option for small companies to file abbreviated accounts at Companies House (CLR)

We seek to be honest and fair in our relationships with our customers (GCC)

Elimination of discrimination in respect of employment and occupation (GC)

Reduce time allowed for filing accounts to seven months for private companies and six months for public companies (CLR)

We provide the standards of products and services that have been agreed. (GCC)

Is your code of conduct based on the core ILO conventions? If not, which issues are missing? (JP)

Largest companies will have to provide an Operating and Financial Review. Quoted companies will be required to prepare a directors’ remuneration report (CLR)

We take all reasonable steps to ensure the safety and quality of the goods and services we provide. (GCC)

Does it apply to all or only part of your supply chain? (JP)

Quoted companies required to publish their accounts on their website, within four months of their yearend. (CLR)

What policies are in place for the welfare of

Measurement, reporting and assurance

Article 13 “Standards, standards, standards” Document 1 – Analysis

Business Relationships (ABI) Business partners, suppliers and consumers (EU CSR) (BM)

Employment (ABI) and industrial relations (OECD)

Disclosure (OECD, AIHR) (CC) (ABI)

Labour (GC) Labour strategy (JP) Employees (GCC)

Reporting (AA1000) (UK CSR) Reporting and responsibility (CLR) (CRB) (JP)

Customers (GCC) Suppliers and sub contractors (GCC) under-age workers if they are found in supply chains?(JP)

(EUCSR1)

To what extent have the policies been discussed with/explained to employees? (JP)

Invites publicly-quoted companies with over 500 staff to publish a ‘triple bottom line’ in reports (EUCSR1)

Provide clear and fair terms of employment.(GCC) Provide clean, healthy and safe working conditions.(GCC) Fair remuneration policy everywhere we operate.(GCC) Strive for equal opportunities for all present and potential employees.(GCC) Encourage employees to develop skills and progress in their careers.(GCC) Do not tolerate any sexual, physical or mental harassment of employees.(GCC) Provide clean, healthy and safe working conditions.(GCC) Non discrimination on grounds of colour, ethnic origin, gender, age, religion, political or other opinion, disability or sexual orientation.(GCC) Do not employ underage staff.(GCC)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Health and Safety (AIHR)(GSP)

Remuneration (SA8000)(ETI)(GSP)

(SA8000)

Stakeholder involvement / Stakeholder relations (F4G) (CC) (UKCSR) (SIG)

Community (GCC)(ABI)(EFQM) Community engagement (AIHR) involvement (LBG)

Planning for accidents and emergencies (SA8000)

Meet legal minimum standards and basic needs plus discretionary income (SA8000, ETI)

Companies should be ready to enter into dialogue with institutional shareholders and vice versa (CC)

Support for and involvement in the communities within which company operates (ABI) (LBG)

Safe and hygienic, or healthy, working environment (SA8000)

No deductions for disciplinary purposes.

Social issues and stakeholder relations (F4G)

Community engagement (AIHR)

Accountable senior management responsible (SA8000)

Overtime should be voluntary (SA8000)

Consult with stakeholders (UK CSR)

Perception measures (EFQM)

Clean and safe sleeping arrangements (SA8000)

Fulfil full labour and social security obligations towards personnel (SA8000, ETI)

Performance indicators (EFQM)

Clean bathrooms, water and sanitary food storage (SA8000)

Compensate employees to meet basic needs raise social and economic opportunities (GSP)

Charitable gift (LBG)

Remuneration detailed clearly and regularly (SA8000, ETI)

Regular, recorded health and safety training for all personnel (SA8000)

Community investment strategy (LBG)

Systems to avoid health and safety threat (SA8000)

Commercial initiative to the community (must give direct competitive advantage back to company) (LBG)

Provide safe and healthy workplace (GSP)

Leverage of cash and resources (LBG)

Protect human health and environment (GSP)

Community benefit (LBG)

Health and safety policies and practices (AIHR)

Business benefit (LBG)

Companies should not engage in or support use of corporal punishment, mental or physical coercion or verbal abuse (AIHR)

Ensure company operations do not have negative impact on communities’ human rights (AIHR)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Health and Safety (AIHR)(GSP)

Remuneration (SA8000)(ETI)(GSP)

(SA8000)

Stakeholder involvement / Stakeholder relations (F4G) (CC) (UKCSR) (SIG)

Community (GCC)(ABI)(EFQM) Community engagement (AIHR) involvement (LBG) Companies should cooperate with community leaders/voluntary organisations (AIHR) Neighbourhood renewal (UK CSR) We aim to make the communities in which we work better places to live and do business. (GCC) We aim to be sensitive to the local community’s cultural, social and economic needs (GCC)

Child labour (AIHR)(ETI)(SA8000) (BM)

Partnership, cooperation, consultation (CRB)(UKCSR)(BM)

Freedom of association and right to collective bargaining (AIHR) (GSP) (ETI)

Freedom from discrimination (AIHR, SA8000, ETI)

No child labour (SA8000, ETI, AIHR)

Prior to decision on major project, company should consult asnd respond to opinions of stakeholders affected by project (CRB)

Trade unions and collective bargaining (SA8000, ETI)

No sexual harassment (SA8000)

Process for remediation of children found engaged in child labour (SA8000, ETI)

As part of consultation, company shall produce environmental, social, economic, financial impact assessment. (CRB)

Facilitate parallel means where law restricts these rights (SA8000, ETI)

No discrimination in hiring, promotion, training and termination of employment (SA8000, ETI)

Promotion of education for children under ILO recommendations (SA8000)

Working in partnership (UK CSR)

Non-discrimination of employee representatives (SA8000, ETI)

Allow employee to observe practices (race, religion) (SA8000)

No exposure of children to hazardous, unsafe, unhealthy situations (SA8000) or working at night (ETI)

Joint ventures, partnerships and subsidiaries (BM)

Open attitude towards activities of trade unions (SA8000) (ETI)

Equal rights and nondiscrimination (AIHR)

Conform to provisions of ILO standards (SA8000)

Freedom of association and collective bargaining (AIHR)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Child labour (AIHR)(ETI)(SA8000) (BM)

Partnership, cooperation, consultation (CRB)(UKCSR)(BM)

Abolishing child labour and forced labour (SA8000, ETI)

Freedom of association and right to collective bargaining (AIHR) (GSP) (ETI)

Freedom from discrimination (AIHR, SA8000, ETI)

Voluntary freedom of association for employees (GSP) Companies have a responsibility to uphold these rights even if they are not protected by a country’s national law (AIHR) Companies should ensure that suppliers/sub contractors do not infringe such rights (AIHR)

Management systems (SA8000)(EUCSR)

Directors (CC) (CLR) (CRB) Management commitment (GCC)

Safe and hygienic working conditions (ETI) (BM)

People (EFQM) The Employed – Persons (BM)

Addressing concerns and taking corrective action (SA8000)

Effective board to lead and control company (CC)

Safe and hygienic, or healthy, working environment (ETI)

People resources are planned, managed and improved (EFQM)

Planning and implementation: requirements understood at all levels (SA8000)

Chairman and CEO with clear balance of power and responsibility (CC)

Planning for accidents and emergencies (ETI)

People’s knowledge and competencies are identified, developed and sustained (EFQM)

Company representatives from senior management and non-management personnel (SA8000)

Formal and transparent process for appointment of new directors (CC)

Regular, recorded health and safety training for employees (ETI)

People are involved and empowered (EFQM)

Policy for social accountability and labour issues by top management (SA8000)

Board balance between executive and nonexecutive director (CC)

Accountable senior management responsible (ETI)

People are the organisation have a dialogue (EFQM)

Management review by top management (SA8000)

Timely, appropriate supply of information to board (CC)

Clean and safe sleeping arrangements (ETI)

People are rewarded, recognised and cared for (EFQM)

Social responsibility integrated management (EU CSR)

Regular re-election of all directors (CC)

Clean bathrooms, water and sanitary food storage (ETI)

People results (EFQM)

Directors’ general duties to the company should be codified, broadly as proposed by

The employed – conditions (BM)

Perception measures (EFQM)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Management systems (SA8000)(EUCSR)

Directors (CC) (CLR) (CRB) Management commitment (GCC)

Safe and hygienic working conditions (ETI) (BM)

People (EFQM) The Employed – Persons (BM)

the Company Law Review (CLR) Proposed guidance for new directors on what these duties mean (CLR)

Performance indicators (EFQM)

Directors liable for significant adverse environmental, social, economic, financial impact due to negligence or wilful misconduct (CRB)

The Employed – Persons (BM)

Management will do all in their power to conform to the letter and spirit of this Charter (GCC)

Forced labour (SA8000)(BM)

Accountability and Audit (CC)(SIG)

Working hours not excessive (SA8000, ETI)

Business ethics (ABI) (BM)

No forced labour (SA8000)

System of internal control (CC)

Compliance with applicable law and industry standard (SA8000, ETI)

Ethical consumerism (ABI)

Workers not required to lodge deposits or identity papers (SA8000)

Formal, transparent arrangements for audit committee and auditors (CC)

Not over 48 hours a week (SA8000, ETI)

Ethical investment (ABI)

Ethical integrity (BM)

Relations with Shareholders (CC) (BM) (GCC)

Leadership (ISO9000) (EFQM)

Process approach (ISO9000)

Company should enter into dialogue with institutional shareholders based on mutual understanding of objectives (CC)

Leaders develop mission, vision and values and are role models (EFQM)

Processes are systematically designed and managed (EFQM)

Board should communicate with private investors and make constructive use of AGM (CC)

Leaders personally involved in ensuring the organisation’s management systems is developed, implemented and continuously improved

Processes are improved, as needed, using innovation to satisfy and generate increasing value for customers and other

Processes (EFQM)

Article 13 “Standards, standards, standards” Document 1 – Analysis

We aim to protect shareholders' funds, manage risks and ensure that funds are used as agreed. (GCC)

(EFQM)

stakeholders (EFQM)

Leaders involved with customers, partners and representatives of society (EFQM)

Products and services are produced, delivered and services (EFQM)

We communicate to shareholders all matters that are material to an understanding of the future prospects of the organisation (GCC) We are financially accountable to our shareholders (GCC)

Article 13 â&#x20AC;&#x153;Standards, standards, standardsâ&#x20AC;? Document 1 â&#x20AC;&#x201C; Analysis

3.2. Single standards areas Consumer interests (OECD)

Combating bribery (OECD)

Science and technology (OECD)

Competition (OECD)

Data protection and consumer privacy (OECD)

No bribery (OECD)

Respect intellectual property rights (GSP) (OECD)

Comply with competition laws (OECD)

No unfair practices towards consumers (OECD)

No illegal contributions to political parties (OECD)

Ties with local learning institutions and industry (OECD)

No anti-competitive agreements (OECD)

Transparent, effective consumer complaints process (OECD)

Management control system (OECD)

Local science & technology development (OECD)

Promote employee awareness of competition policies (OECD)

Clear information on goods and services (OECD)

Transparency (OECD)

Technology transfer (OECD)

Co-operate with competition authorities (OECD)

Meet consumer health and safety standards (OECD)

Promote employee awareness and compliance with company policy on bribery (OECD)

Comply with national science & technology policies (OECD)

Promote fair competition (GSP)

Fair business, marketing and advertising practices (OECD)

No mis-channelling of payments (OECD)

Local capacity – building in Science and Technology (OECD)

Respect intellectual and property rights (GSP)

Meet host country policies (OECD)

Appropriate remuneration (OECD)

Not offer, accept bribes (GSP)

No exemptions from statutory framework (OECD) No improper involvement in local political activity (OECD)

Employment freely chosen (ETI)

Quality of life (GSP)

Directors’ Remuneration (CC)

No forced, bonded or involuntary prison labour (ETI)

Work with government and communities to improve quality of life, seek to provide training and opportunities for disadvantaged workers (GSP)

Transparent and formal procedure for developing policy on director’s remuneration (CC)

Workers not required to lodge deposits or identity papers (ETI)

Persons with disabilities (BM)

Appropriate remuneration to directors, link rewards with performance (CC)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Women in the workforce (BM)

Minority groups (BM)

Employee equal opportunities (GSP)

Institutional investors (CC)

Living wage (ETI)

Provide regular employment (ETI)

Corporate social responsibility (EU CSR)

Institutional shareholders have a responsibility to make considered use of their vote (CC)

Meet legal minimum standards and basic needs plus discretionary income (ETI)

Work performed must be on basis of recognised employment relationship through national law and practice (ETI)

Social and eco-labelling (EU CSR)

Institutional shareholders should be ready to enter into dialogue with companies (CC)

No deductions for disciplinary purposes.

Fulfil full labour and social security obligations towards personnel (ETI)

Quality in work (EU CSR)

Remuneration detailed clearly and regularly (ETI) All workers provided with written and understandable information about their employment conditions before entering employment (ETI)

Driving up skills and education levels (UK CSR)

Social responsibility auditing and reporting (EU CSR)

Socially responsible investment (EU CSR) Social responsibility integrated management systems (EU CSR)

Taxation (OECD)

Disciplinary practices (SA8000)

No harsh or inhumane treatment (ETI)

Comply with national tax laws and regulations (OECD)

No corporal punishment, abuse etc. (SA8000)

No physical abuse, discipline, sexual harassment, intimidation (ETI)

Security (AIHR)

Fair working conditions (AIHR)

Freedom from slavery (AIHR)

General policies (OECD)

Security arrangements to protect human rights (AIHR)

Companies should ensure just and favourable conditions of work, reasonable job security and fair and adequate remuneration and benefits (AIHR)

Policies and practices to prohibit the use of chattel slaves, forced labour, bonded child labourers or coerced prison labour. (AIHR)

Contribute to sustainable development (OECD)

Adequate training for security personnel (AIHR)

Companies should provide for adequate standard of living for employees and families (AIHR)

Companies should ensure suppliers and sub-contractors do not use such labour (AIHR)

Respect human rights (OECD)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Financial integrity (BM)

Security (AIHR)

Fair working conditions (AIHR)

Clear rules for contracting with state security forces (AIHR)

Companies should ensure that suppliers/subcontractors do not infringe such rights (AIHR)

Freedom from slavery (AIHR)

Prompt and independent investigation of security procedure complaints (AIHR)

General policies (OECD) Encourage local capacity building (OECD)

Encourage human capital formation (OECD)

Not seek exemption from EHS, labour, taxation, financial incentives (OECD) Support and uphold good corporate governance (OECD) Effective self-regulatory practices and management systems (OECD) Promote employee awareness of company policies through training programmes (OECD) Refrain from discriminatory and disciplinary action against employees reporting complaints (OECD) Encourage business partners to apply principles of corporate conduct compatible with OECD Guidelines (OECD) Abstain from improper involvement in local political activity (OECD)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Labels (EUCSR1)

Environmental and social duties of directors (CRB)

Corporate Responsibility Board (CRB)

Provision of information by companies (CRB)

Labels should be implemented in an objective, transparent, credible and nondiscriminatory manner, respecting EU international obligations and applicable competition rules (EUCSR1)

Duty of directors to prepare report identifying risks to company from environmental, economic and social impacts and how these will be managed (CRB)

Board members will be appointed who are stakeholders of companies; those that have experience in environmental, social and economic impact (CRB)

Copy of report to be sent to Financial Services Authority and London Stock Exchange (CRB)

Schemes should be voluntary (EUCSR1)

Directors should disclose any relevant qualifications/training in these matters (CRB)

Board will have powers to issue directions to companies if Act is being breached (CRB)

Compile a list of background papers to any report or assessment (CRB)

ILO core labour conventions should constitute a minimum baseline for label schemes (EUCSR1)

Duty of directors to consider/minimise environmental, social, economic and financial impacts of operations (CRB)

Board will have powers to investigate matters of concern and the right to summon evidence and information to aid investigation (CRB)

Duty of directors to consider interests of stakeholders (CRB)

Board will carry out specific number of random audits of companies (CRB) Set up within one year of passing the Act, with duty to issue guidelines (CRB) Board will publish annual report (CRB)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Key performance results (EFQM)

Corruption (JP)

Conflict (JP)

Access to medicines (JP)

Key performance outcomes (EFQM)

Company policy (JP)

Risk assessment of business impact on local communities carried out? What knowledge has been sought and from whom? (JP)

Company policy on maximising access to quality medicines in developing countries? Is it publicly available? (JP)

Key performance indicators (EFQM)

Sub-contractors process to dissuade bribery? (JP)

Did the company seek to mitigate any negative impacts? (JP)

Does Board consult with independent public health specialists from developing countries?

Procedures for company payment to agents (JP)

Does the company undertake training of all personnel and subcontractors on these issues? (JP)

Does company report on your written policy? Does company evaluate performance against policy?

Company agents sign up to company’s anticorruption policy? (JP)

Company involved in any development initiatives in conflict areas? (JP)

Is your company involved in any legal or trade dispute relating to protection of intellectual property rights in a developing country?

Joint ventures partners fully aware of company’s anticorruption strategy (JP)

Does company report against impact on conflict or potential conflict? (JP)

Does your company monitor the application of internationally agreed ethical standards to clinical trials in developing countries? (JP)

Clear guidelines for the giving and receiving of gifts and entertainment, with disclosure to senior management? (JP)

If the company's presence in a particular area is perceived to be leading to deterioration in the conflict, does it have any means of acting promptly? (JP)

Does the company make payments to political parties? If so, procedures to ensure payments not to obtain business or other commercial benefits? Company committed to voluntary additional disclosure of revenues, profits and capital employed by country, instead of by region?

Article 13 “Standards, standards, standards” Document 1 – Analysis

Involvement of people (ISO9000)

Embedding (AA1000)

Identify external concerns and relate to business (UKCSR)

Adaption to change (EU CSR)

Capital enhancement (SIG)

Establish and embed systems (AA1000)

Planning (AA1000)

Accounting (AA1000)

Auditing (AA1000)

Establish commitment (AA1000)(UK CSR)

Identify issues (AA1000)

Audit reports (AA1000)

Identify stakeholders (AA1000)

Analyse info, set targets and develop improvement planning (AA1000)

Social responsibility auditing (EU CSR)

Define / refine values (AA1000)

Subsidiaries, mergers (CRB)

Policy and strategy (EFQM)

Partnerships and resources (EFQM)

Management standards (EUCSR1)

Any subsidiary of company must comply with provisions of bill (CRB)

Policy and strategy are based on the present and future needs of stakeholders (EFQM)

External partnerships are managed (EFQM)

Recommends use of EMAS (EUCSR1)

Policy and strategy based on information from performance measurement, research learning and creativity related activities (EFQM)

Finances are managed (EFQM)

Policy and strategy are developed, reviewed and updated (EFQM)

Buildings, equipment and materials are managed (EFQM)

Policy and strategy are deployed through framework of key processes (EFQM)

Technology is managed (EFQM)

Policy and strategy are communicated and implemented (EFQM)

Information and knowledge are managed (EFQM)

Review strategy and plan actions (UK CSR)

Article 13 “Standards, standards, standards” Document 1 – Analysis

Establishing properly monitored policies (JP)

Risk assessment (JP)

Codes of conduct (EUCSR1)

Written policy on issue? (JP)

Procedures in place to assess risk in current and proposed operations? (JP)

Be built on ILO Conventions and OECD guidelines (EUCSR1)

Written policy available to the public? (JP)

Does risk assessment include company’s joint venture partners, suppliers, subcontractors? (JP)

Include evaluation and verification of implementation, and compliance (EUCSR1)

Does it set targets and improvement strategies? (JP)

What sources of information does the company use to inform this process? (JP)

Involve social partners and other relevant stakeholders (EUCSR1)

Is the performance of the policy internally monitored and independently verified? (JP)

What level of dialogue is there with other relevant bodies? (JP)

Disseminate experience of good practice of European enterprises (EUCSR1)

What level of training is carried out for staff? (JP)

What court cases or negative press coverage has the company or its joint venture partners, subcontractors and suppliers been involved with in recent years on this issue? (JP)

Human Resource management (EU CSR)

What are the numbers and seniority of staff employed to implement the policy? (JP) Is there a system in place enabling employees or local communities safely to raise breaches of the policy with management? (JP)

System approach to management (ISO9000)

Continual improvement (ISO9000)

Factual approach to decision-making (ISO9000)

Article 13 “Standards, standards, standards” Document 1 – Analysis

4. Emerging themes – approaches rather than just content In the previous section we considered the areas covered by the standards under the headings defined by standards themselves. In this section we have pulled out what seem to us common emerging themes which cut across many of the areas mentioned above. They are coming from the standards we have reviewed and are not areas in themselves but are rather approaches that are advocated by these leading standards As they are non-specific there is clear opportunity to then be applied in a bespoke way to an organisations’ activities to add to the “way we do business”. 1. Capacity building Capacity building is related to the input of companies into the communities they are based in or that they come into contact with. Given particular credence by the OECD Guidelines, it can relate to the stakeholders an organisation interacts with e.g. building the skills and competency of local suppliers and subcontractors, investing in local education and training to build a workforce for the future. It can relate not only to human capital, but also to the physical environment and the local economy e.g. investing in the infrastructure of a local community. 2. Training and education This carries on from the previous theme but also relates to the internal stakeholders of an organisation - its employees, from the shop floor to director level. Whether it be environment, bribery, human rights or corporate values, training staff and disseminating information on any of these areas is essential if the policies and programmes a company puts in place are to be made living and relevant to 'me' in 'my' job. Numerous standards (10 of the 26 reviewed) stress the importance of training and education, from the GRI Reporting Guidelines to Amnesty International's Human Rights Principles. 3. Corporate governance Cross-cutting many of these areas is corporate governance – the way an organisation is run. We can consider the main strands to be financial integrity, transparency and accountability, leadership from the board and being the employer of choice. This is again central to the implementation of policies and programmes in any of the areas covered by the standards. Good governance means these areas are embedded in the organisation, and deliver to the business objectives and to stakeholder objectives, and are not just nice-to-haves. 4. “Working together” – consultation, partnership, co-operation Again a theme that underpins many of the standards is a form of "working together". This is in recognition of the value delivered by a participative approach, which is particularly important when considering corporate responsibility where a number of actors are involved. For an organisation to evolve from being a stand-alone entity to one that understands and reacts to its wider role in society some form of participation, be it through consultation, partnership or co-operation, is essential. Article 13’s experience shows that companies find this approach particularly important in overcoming barriers to employment in socially excluded areas. 5. Influencing through example Whether it is up-stream (suppliers or sub-contractors) or downstream (customers, consumer) an organisation can have a significant influence and spread good practice on areas such as environment and human rights. Indeed, it can even be an essential risk management strategy to engage with these stakeholders as born out by the examples of Nike and Marks & Spencer’s.

Article 13 “Standards, standards, standards” Document 1 – Analysis

5. By Business Function This section takes a particular business function and considers which of the areas that we have examined in previous sections of this document might be considered within that function. This gives a different perspective and starts to address how all this might be made practical within an organisation. It takes as a starting point business issues and business strategy, and outlines which issues required by the standards could deliver value. How to use this section: Your question: I am a human resources manager and I hear that I should be looking at issues such as human rights – but what does that mean to this business? Is it relevant? Not only that, but I also hear that looking at areas such as these might even improve staff motivation, attraction and retention. What should I be looking at? And how will it improve this department’s performance? Answer We have looked at these standards from your point of view and gathered together all the areas that we feel would be relevant to your role. Take the headline areas and for more detail refer back to the tables in section 3.

5.1. Human resources The areas to look at as a minimum: Human Rights Employment and industrial relations Training and education Health and Safety Competition Combating bribery Stakeholder involvement Social Corporate social responsibility No harsh or inhumane treatment Child labour Forced labour Freedom of association and collective bargaining Discrimination Disciplinary practices Working hours Remuneration Management systems Human Resource management Leadership Involvement of people Training and education (see section 4) Capacity building (see section 4) Corporate governance (see section 4) 5.2. Supply chain The areas to look at as a minimum: Business relationships Business partners, suppliers and consumers Capacity building Competition Science and technology Health and Safety Stakeholder involvement

Article 13 “Standards, standards, standards” Document 1 – Analysis

Leadership Partnership, co-operation, consultation Human rights Employment and industrial relations General policies 5.3. Corporate governance The areas to look at as a minimum: Policy and strategy Leadership Factual approach to decision-making System approach to management Process approach Involvement of people Management systems Embedding Identify external concerns and relate to business Environmental and social duties of directors Liabilities of directors Institutional investors Taxation Disclosure Partnership, co-operation, consultation Corporate social responsibility Directors Directors' Remuneration Relations with Shareholders Accountability and Audit Stakeholder involvement / Stakeholder relations Business ethics Combating bribery Business Relationships Business partners, suppliers and consumers Employment and industrial relations Labour 5.4. Innovation The areas to look at as a minimum: Science and technology (OECD) Partnership, co-operation, consultation (CRB) Corporate social responsibility Driving up skills and education levels (UK CSR) Identify external concerns and relate to business (UKCSR) Adaption to change (EU CSR) Leadership (ISO9000) (EFQM) Policy and strategy (EFQM) People 5.5. Risk management The areas to look at as a minimum: Policy and strategy Leadership Factual approach to decision-making System approach to management Process approach Management systems Embedding Identify external concerns and relate to business

Article 13 “Standards, standards, standards” Document 1 – Analysis

Environmental and social duties of directors Liabilities of directors Institutional investors Disclosure Partnership, co-operation, consultation Corporate social responsibility Directors Directors' Remuneration Relations with Shareholders Accountability and Audit Stakeholder involvement / Stakeholder relations Business ethics Combating bribery Business Relationships Business partners, suppliers and consumers Employment and industrial relations Labour

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Article 13 “Standards, standards, standards” Document 1 – Analysis

Article 13 “Standards, standards, standards” Document 2 – the evidence February 2003

Contents A. The Indices 1. FTSE4Good – Series of Indices 2. DJSI – Series of Indices B. The Guidelines 3. ABI – Report and Recommendations 4. GRI – Reporting Guidelines 5. OECD Guidelines for Multinational Enterprises 6. Just Pensions – Guide for Trustees and Fund Managers 7. SIGMA Guidelines 8. UK CSR – DTI Society and Business Report 2002 9. EU CSR – Green Paper “Promoting a European Framework for Corporate Social Responsibility”, “A business contribution to sustainable development C. Commitments 10. Global Sullivan Principles 11. UN Global Compact 12. GoodCorporation Charter 13. Amnesty International Human Rights Principles for Companies 14. The London Principles D. Processes 15. AA1000 – Process Standard 16. The Natural Step E. Benchmarking 17. London Benchmarking Group 18. Bench Marks - Principles for Global Corporate Responsibility F. Standards 19. SA 8000 20. ISO 9000 family 21. ISO 14000 family 22. ETI Base code G. Legal/Code 23. Combined Code – Principles of good governance and code of best practice 24. Core Bill 25. UK Government Company Law Review H. Business models 26. The European Foundation Quality Model (EFQM) Excellence Model

3 6 13 14 25 28 31 32 33

35 36 37 39 40 41 42 43 44 45 47 48 49 51 52 54 55

Our selection criteria These standards have been selected for their relevance not just to the corporate responsibility and sustainable development debate but also for their relevance to business issues, business strategy and management. Our methodology This documents takes each standards and outlines the key components and process for each, answering the following questions: • What is the standard’s mission and scope? • Does it focus on any stakeholders in particular? • Does it quote any specific companies/organisations as best practice? • The “what”: What are the substantive areas it considers? Are there any indicators? • The “how”: What are the process areas it considers? Are there any indicators? What is our source of information? Which organisation is the standard created by?

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1. FTSE4Good Index Mission and scope “FTSE4Good is an index series for socially responsible investment designed by FTSE, one of the world's leading global index providers. FTSE4Good is a series of benchmark and tradable indices facilitating investment in companies with good records of corporate social responsibility” Stakeholder focus This is one of the three key areas FTSE4Good focuses on. See below. Best practice See indices What do I need to look at? AREAS Selection criteria cover three areas, as illustrated by the indicators below: 1. Working towards environmental sustainability 2. Upholding and supporting universal human rights 3. Developing positive relationships with stakeholders INDICATORS Indicators exist for each of these three areas. FTSE4Good also differentiates between high, medium and low impact companies. For each of these a different level of compliance is required 1. Environment 1.1. Policy Core indicators a. Policy refers to all key issues b. Responsibility for policy at board or environment department level c. Commitment to use of targets d. Commitment to monitoring and audit e. Commitment to public reporting Desirable indicators f. Globally applicable corporate standards g. Commitment to stakeholder involvement h. Policy addresses product or service impact i. Strategic moves towards sustainability 1.2 Management j. Presence of environmental policy k. Identification of significant impacts l. Documented objectives and targets in key areas m. Outline of processes and responsibilities, manuals, action plans, procedures n. Internal audits against the requirements of the system (not limited to legal compliance) o. Internal reporting and management review 1.3 Reporting Core indicators p. Text of environmental policy q. Description of main impacts r. Quantitative data s. Performance measured against targets Desirable indicators t. Outline of environmental management system u. Non-compliance, prosecutions, fines, accidents v. Financial dimensions

Article 13 “Standards, standards, standards” Document 2 – Evidence

w. Independent verification x. Stakeholder dialogue y. Coverage of sustainability issues 2. Human Rights a. Have a policy statement specifically on human rights, which goes beyond employee rights b. Have a policy statement committing to at least two of the International Labour Organisation's Core Labour Standards for employees globally c. Have signed up to human rights initiatives such as the UN Global Compact, the Global Sullivan Principles, SA 8000, Ethical Trading Initiative, and Voluntary Principles on Security and Human Rights 3. Social issues and Stakeholder Relations 3.1 Policy a. Adopting a Code of Ethics or Business Principles b. Adopting an equal opportunities policy and/or including a commitment to equal opportunities or diversity in their annual report or web-site 3.2 Management systems c. Providing evidence of equal opportunities systems including one or more of the following: i. monitoring of the policy and workforce composition ii. flexible working arrangements and family benefits (meaning at least three of flexible working time, child care support, job sharing, career breaks, or maternity or paternity pay beyond the legal requirements) iii. more than 10% of managers being women or the proportion of managers who are women or from ethnic minorities exceeding two fifths of their representation in the workforce concerned iv. assigning responsibility for the policy to a senior executive or board member. d. Providing evidence of health and safety systems including one or more of the following: i. awards ii. details of health and safety training iii. published accidents rates or assigning responsibility for health & safety to a senior executive or board member. e. Providing evidence of training and employee development systems including one or more of the following: i. annual training reviews for staff (more than 25% of those staff where figures are available) ii. providing significant data on time and money spent on training iii. assigning responsibility for training and development to a senior executive or board member. f. Providing evidence of systems to maintain good employee relations including: i. union recognition agreements or other consultative arrangements (covering more than 25% of staff where figures are available) ii. assigning responsibility for pay and benefits issues to a senior executive or board member. 3.3 Practice and Performance g. Making charitable donations in excess of £50,000; operating payroll giving schemes; providing gifts in kind or staff secondments to community schemes or assigning responsibility for charitable donations or community relations to a senior executive or board member. h. Companies must not have breached the infant formula manufacturing section of the WHO/UNICEF International Code on Marketing of Breastmilk Substitutes according to the International Baby Food Action Network. How do I need to look at it? AREAS

Article 13 “Standards, standards, standards” Document 2 – Evidence

The Model of Best Governance Practice for Corporate Social Responsibility - Understanding - Policy - Management Systems - Performance and Monitoring - Reporting - Consultation INDICATORS - See Environment and Social management system indicators above Source/Organisation Produced by FTSE Uses themes identified by: - The Universal Declaration of Human Rights (1948) - The OECD Guidelines for Multinational Enterprises (1976) - The UN Global Compact (1999) - CERES (Coalition for Environmentally Responsible Economies)(1989) - Amnesty International Human Rights Principles for Companies - The Caux Round Table Principles for Business (1994) - The Global Sullivan Principles (1977) - Ethical Trading Initiative – The Base Code (1998) - Social Accountability 8000 (1997) - Global Reporting Initiative(GRI) Sustainability Guidelines (1999)

Article 13 “Standards, standards, standards” Document 2 – Evidence

2. Dow Jones Sustainability Index Mission and scope “The Dow Jones Sustainability Indexes are focused on meeting the financial market's demands for: - Rational, consistent, flexible and, most importantly, investable indexes to benchmark the performance of investments in sustainability companies and funds. - Independent reliable indexes as a basis for derivatives and funds focused on sustainability companies” The argument is that leading sustainability companies display high levels of competence in addressing global and industry challenges in a variety of areas: strategy, financial, customer relationship management and product development, governance and stakeholder relations and human resources management. These create long term shareholder value, which more and more investors are interested in making sustainability an “investable concept” . Stakeholder focus There is no particular stakeholder focus, but stakeholder involvement is a part of the social area, where reference is made to the following types of stakeholders: Employees, Customers, Shareholders, Suppliers, Trade Unions, Communities, Non Governmental Organizations Best practice See sector leaders: www.sustainability-index.com What do I need to do? To be included on this index, companies need to fill in a questionnaire which requires companies to provide information in three key areas which are detailed below. To be able to qualify for this companies may need to look at the specific areas the questionnaire highlights to find out where they are, where they need to be, and put in place an action plan on how to move towards that. Going through this process itself is a sign of good governance and will inform the assessment. What do I need to look at? AREAS There are three main areas which are in turn split up into various sub-areas - Economic - Environmental - Social INDICATORS 1. Economic: 1.1. Corporate governance - Defined and implemented standards - Number of members on board of directors - Members of board with executive management functions - Non-executive chairman - Nationalities represented on Board - Specialist committees? (Audit, Compensation, Strategy, Risk, IT, etc.) 1.2. Strategic planning - Tools used in strategic planning of highly uncertain issues - Timeframe for strategic long-term planning - Use of balance scorecard or similar system to implement KPIs and adapt them to strategic goals. If yes, which perspectives are integrated (Customer, Financial, Internal, Learning perspective) - Value based management approaches used for strategic decision-making (EVA, DCF, WACC) 1.3. Organizational development

Article 13 “Standards, standards, standards” Document 2 – Evidence

Organisational dimensions considered in organisational development (structural, political, cultural, process, other) - Core values of your company as described in mission/strategy statement (Trust, Integrity, Caring, Social/Environmental commitment, Teamwork, Entrepreneurship, Other) - Is one of these core values explicitly considered in senior management performance appraisal and appointment policies? 1.4. Corporate codes of conduct - Are corporate codes of conduct valid for all employees implemented at your company? - State issues covered (Corruption and bribery, discrimination 1.5. Risk & Crisis management - Does company have person with overall responsibility for risk and crisis management? - Corporate risk standards and guidelines implemented covering following major risk types?: Occupational health& safety, Security, IT Security, Financial risk, Other) - Extent of implementation - Does company corporate risk management system include regular staff education and training? - Is company risk management strategy based on: root cause analysis, worst case scenarios, other? - Does company have a business continuity plan? - Does you business continuity plan include a crisis management focus? - Early warning system in place for future threats? - Does crisis management also cover reputation risks? - Are written contingency plans implemented which: o are coordinated with local community emergency response services? o include mutual aid agreements (between companies)? o include staff training and education on a regular basis? o are based on worst case scenarios? - Does company have an incident / near miss notification procedure in place? 1.6. Intellectual capital management - Does company have person with overall responsibility for knowledge management? - Which areas of intellectual capital (IC) are actively managed? - Does intellectual management system include: o regular tracking of employee skills and motivation and programmes to improve alignment with company IC needs o measurement of intellectual capital o incentives for attracting and retaining professionals with strategic skills and know-how? 1.7. IT management & IT integration - Does company have person with overall responsibility for information technology? - What percentage of employees have access to Intranet and internal email systems? - Does company have harmonised master data management system for company specific information, data and contracts? - Does company use a customer relationship management (CRM) system? - Does company offer internet portal for CRM (e-business solution)? - Since when? - Share of customers managed via internet-based CRM - Share of customers in terms of % of total revenue - Does company use a supply chain management (SCM) system? - Does company offer internet portal for SCM (e-business solution)? - Since when? - Share of suppliers managed via internet-based SCM - Share of suppliers in terms of % of total procurement volume 1.8 Quality management - Implementation of a Total Quality Management (TQM) system?

Article 13 â&#x20AC;&#x153;Standards, standards, standardsâ&#x20AC;? Document 2 â&#x20AC;&#x201C; Evidence

Does TQM system include o Regular tracking and analysis of customer satisfaction? o Business evaluation of efficiency and effectiveness (How do I need to look at it? e.g. service to customer)? o Requirement that major suppliers/sub-contractors also have TQM in place? - Has your company won the Malcolm Baldrige Award or has it been finalist in its category within last three years? - Has your company won the European Quality Award or has it been finalist in its category within last three years? - Has your company win any other quality award or has it been finalist in its category within last three years? Environment Responsible person for environmental issues - Person with overall responsibility for environmental issues at highest management level - Does company have a unit at corporate level in charge of overall coordination of environmental issues? - Number of functional levels between the environmental unit and executive board - How many people allocated to coordinate environmental issues at corporate level? - Is each line managers responsible for managing corporate environmental policies and standards? Environmental policy - Are corporate environmental policies implemented at your company? - Which issues are covered by these policies? o Benchmarking targets within peer group o Measurable objectives or targets o Impact of products o Impact of suppliers - Does company have worldwide minimum environmental standards that apply to all facilities and subsidiaries? - Do these minimum standards cover the following areas? o Water emissions o Air emissions o Use of resources o Waste Environmental Charters - Has company signed environmental charters, or is it committed to the principles of sustainability councils/coalitions? - Is a representative of the top management member of the steering committee one of such a council/coalition? Environmental management system - Has the Environmental Management System implemented? - What is the management system certified to? - Is it audited? - Details of third party audits required Environmental performance - Does company evaluate its environmental performance (monitoring of energy use, greenhouse gas emissions, water use, etc)? - Does company evaluate the environmental performance of its products (life cycle assessment, eco-balance)? - Complete the following table with your company-wide environmental performance data, or enclose relevant documents. - The following data covers unit generating _____% of total revenues. Starting from 1997 to 2000: o Energy consumption including fuel for commercial vehicles o Total Emissions of greenhouse gases o Total water use o Total waste generation -

2. 2.1.

2.2.

2.3.

2.4.

2.5.

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o Ozone depleting substance emissions Indicate your company’s energy mix: o Gas o Oil o Electricity from grid o Coal o Hydropower o Photo-voltaic/Wind o Others, please specify Environmental reporting - Does company publicly provide information on its environmental activities? - If yes, how is reported? o Published in a separate environmental report o Integrated in the annual financial report o Integrated in a sustainability report o Published on the internet o Others o Not known - How often does company update public environmental information? - Does company actively participate in any initiatives to standardize environmental or sustainability reporting? Environmental profit & loss accounting - Does your company conduct environmental profit and loss accounting? - Is the environmental accounting information integrated into product pricing? - Indicate the person with overall responsibility for social issues at the highest management level - Number of levels from the executive board - Does company have a unit at corporate level in charge of overall coordination of social issues o Please indicate the number of levels between the social unit and the executive board - How many people are allocated to the coordination of social/workforce issues at the corporate level? - Is each line manager responsible for implementing corporate social policies and standards? Social Responsibility for social issues - Indicate person with responsibility for social issues and give details - Number of levels from executive board - Does your company have a unit at corporate level in charge of overall coordination of social issues? If yes, indicate number of levels between social unit and executive board - How many people are allocated to the coordination of social/workforce issues at the corporate level? - Is each line manager responsible for implementing corporate social policies and standards? Social Policy - Are corporate social policies implemented at the company? - If yes, please indicate the extent of the implementation - Which issues are covered by these policies? o Child labor o Disciplinary practices o Forced labor o Freedom of association o Layoffs o Employee development o Non-discrimination/equal opportunities o Remuneration o Working flexibility o Sexual harassment -

2.6.

2.7.

3. 3.1.

3.2.

Article 13 “Standards, standards, standards” Document 2 – Evidence

3.3.

3.4.

3.5.

3.6.

o Stakeholder consultation Stakeholder involvement (separate boxes for each ‘stakeholder’ group) - Indicate ways in which you regularly involve employees/customers/shareholders/suppliers/distributors/ /trade unions/communities/NGOs in developing your company’s business strategies. - Economic Issues: o Project teams o Hearings/adv board o Regular information o No involvement - Environmental Issues: o Project teams o Hearings/adv board o Regular information o No involvement - Social Issues: o Project teams o Hearings/adv board o Regular information - Does your company regularly track the satisfaction or complaints of the following stakeholders? o Employees o Customers o Shareholders o Suppliers o Trade Unions o Communities o Non Governmental Organizations Layoffs / Freedom of association - Does company have a policy concerning the right of all employees to form and join trade unions of their choice and bargain collectively? - Does company have a code of conduct, guidelines and/or special programs that apply in case of layoffs? - Has company implemented a system to prevent or handle discrimination? - Does company require specific health tests before hiring people also in cases where this is not necessary for specific working condition? o AIDS-test o Pregnancy test o Genetic screening o Others o No Equal rights and non-discrimination - Has your company implemented a system to prevent or handle discrimination? - Does your company require specific health tests before hiring people also in cases where this is not necessary for specific working conditions? Occupational health & safety standards - Does company have publicly available policies and standards for occupational health and safety (OHS)? - Indicate total lost working hours due to illness and accidents in the following years o 1997 – 2000 - Is company’s OHS system audited by the third parties? - Is the OHS performance information publicly reported? - Does company provide special training and/or incentives to its employees in the following OHS areas? o Workplace hygiene o Working conditions/workplace safety o Health and wellness o Others o No

Article 13 “Standards, standards, standards” Document 2 – Evidence

3.7.

3.8.

3.9.

3.10.

3.11.

o Not applicable Conflict resolution - Has company implemented a system to deal with workforce conflict situation? - Does company offer opportunities to employees to appeal disciplinary measures? Standards for suppliers - Indicate areas in which your company has defined standards applying to its main contractors: o Child labour o Forced labour o Non-discrimination o Worktime flexibility systems o Adequate payment of employees o Safe and healthy working conditions of employees o Disciplinary practices o Hiring conditions only on contract basis o No standards for suppliers o Is a system in place to verify that suppliers comply with the above standards? Social reporting - Does company publicly provide information about its social activities? - How is reported? o Published in a separate social report o Integrated in the annual financial reports o Integrated in the sustainability reports o Published on the internet o Others - How often company update public social information? o Annually o Every second year o Irregularly o Others o Not known - Does company participate in any initiatives to standardize social or sustainability reporting? Employee satisfaction - Does company regularly track the job satisfaction of its employees with regards to the following issues? o Salary o Job function o Job content o Personal development possibilities o Working environment (health and safety standards, social climate, etc) o Identification with company values and strategy o Others o No o Not applicable o Not known - Indicate the yearly average turnover rate of your personnel: o Less than 5% o 5-10% o 10-15% o 15-25% o More than 25% Remuneration - Does company use stock purchase, stock options or profit sharing schemes as part of its remuneration systems? o Yes, for top management o Yes, for more than 50% of all employees o No

Article 13 â&#x20AC;&#x153;Standards, standards, standardsâ&#x20AC;? Document 2 â&#x20AC;&#x201C; Evidence

3.12.

3.13. 3.14.

o Not applicable o Not known - Is a system in place linking sustainability performance to compensation? o Yes, for top management o Yes, for more than 50% of all employees o No o Not applicable Employee benefits - Does company support external or maintain internal child care facilities? - Has company defined world-wide minimum standards for maternity leave? - Please indicate the level of remuneration during maternity level Different risk related criteria for each industry group Different opportunity related criteria for each industry group

How do I need to look at it? AREAS Many of the sub-areas within economic, environmentals and social above have a How do I need to look at it? e.g.: Within economic: - Strategic planning - Organisational development - Risk and crisis management - Intellectual capital management - IT management and IT integration - Quality Management Within environmental: - Environmental Management System - Environment, health and safety reporting - Environment profit and loss accounting Within social: - stakeholder involvement - conflict resolution - social reporting INDICATORS (see detail for these areas above) Source/Organisation The identification of sustainability leaders for the Dow Jones Sustainability Indexes is based on the Corporate Sustainability Assessment of SAM Research.

Article 13 â&#x20AC;&#x153;Standards, standards, standardsâ&#x20AC;? Document 2 â&#x20AC;&#x201C; Evidence

3. ABI Disclosure Guidelines – Report and Recommendations Mission and scope ABI commissioned a report on corporate social responsibility to “explore the impact of corporate social responsibility (CSR) on business, and how companies might manage the resulting risks” In particular the report included “disclosure guidelines” which outlined specifically what investors would be looking for when assessing a company’s management of social, environmental and ethical risks. This is a response to the growing demand for transparency and information on these aspects of a company’s risk management. Stakeholder focus Specific stakeholders dictate some of the key headline areas that ABI focuses on, for example, see below “communities” and “business relationships”, i.e. relationships up and down the supply chain. Best practice General: GUS, BT, Legal and general and Rio Tinto What do I need to look at? AREAS - Human rights - Employment - Environment - Communities - Business relationships INDICATORS NA but refer to FTSE4Good criteria / indicators How do I need to look at it? AREAS Investors are likely to seek answers to these 11 questions: 1. Has the company made any reference to social, environmental and ethical (SEE) matters? If so, does the board take these regularly into account? 2. Has the company identified and assessed the significant risks and opportunities affecting its short and long term value arising from its handling of SEE matters? 3. Does the company state that it has adequate information for identification and assessment? 4. Are systems in place to manage the SEE risks? 5. Are any remuneration incentives relating to the handling of SEE risks included in risk management systems? 6. Does Directors’ training include SEE matters? 7. Does the company disclose significant short and long term risks and opportunities arising from SEE issues? If so, how many different risks/opportunities are identified? 8. Are policies for managing risks to the company’s value described? 9. Are procedures for managing risk described? If not, are reasons for non-disclosure given? 10. Does the Company report on the extent of its compliance with its policies and procedures? 11. Are verification procedures described? INDICATORS N/e Source/Organisation Report produced by ABI, Andersen and Marsh. Refers to: goodcorporation.com charter, FTSE4Good criteria, Just Pensions, and Marsh Reputation risk framework

Article 13 “Standards, standards, standards” Document 2 – Evidence

4. Global Reporting Initiative (GRI) – Reporting Guidelines Mission and scope “The Global Reporting Initiative (GRI) is a long-term, multi-stakeholder, international process whose mission is to develop and disseminate globally applicable Sustainability Reporting Guidelines (“Guidelines”) for voluntary use by organisations1 reporting on the economic, environmental, and social dimensions of their activities, products and services. The aim of the Guidelines is to assist reporting organisations and their stakeholders better describe and articulate the overall contributions of the reporting organisations towards sustainable development.” Stakeholder focus The GRI covers all the main stakeholder groups Best practice No evidence of any specific best practice companies, but the website lists companies who are using the guidelines. What do I need to look at? AREAS -

Economic (includes but is not limited to financial information) Environmental Social

INDICATORS Core Customers Monetary Distribution indicator: EC1. Monetary amounts received and receivable by the reporter from customers for the sales of its products and services. EC2. Geographic breakdown of ‘key’ markets by sales. Key markets are defined as greater than 25% turnover within any specific product range or where the reporter country sales represents greater than 5% of national GDP. EC3. Market share of products or product lines/ranges/services in 'key' markets.

Non-core

EC13. Customer perception of how far relationship with reporting organisation brings economic benefit.

Suppliers Monetary Distribution indicator: EC4. Monetary payments and payables by the reporter to suppliers for all goods, materials, and services purchased. EC5. For 'key' suppliers: percent of purchasing spent per supplier and main invoicing country. ‘Key’ is defined as greater than 10% of total purchasing spent with a given supplier or where total reporter purchasing spent in a particular country represents greater than 5% of national GDP.

EC14. Supplier perceptions of value of relationship with reporting organisation in economic terms (e.g. improved productivity, increased human and intellectual capital).

Article 13 “Standards, standards, standards” Document 2 – Evidence

EC6. Percent of contracts paid in accordance with agreed terms, excluding agreed penalty arrangements. Employees Monetary Distribution indicator: EC7. Monetary value of total remuneration to employees (including wages, pension, and other benefits and redundancy payments) broken down by geographic region. Total remuneration should refer to current payments and not include future commitments. Note: LA7 also serves as a measure of economic performance for this aspect

EC15. Employee perception of value of relationship with reporting organisation in economic terms.

Funders Monetary Distribution indicator: EC8. Interest on debt and common share dividend payments. Any arrears in preference dividends should be stated. EC9. ROACE (Return On Average Capital Employed). Public sector Monetary Distribution indicators: EC10. Total sum of taxes paid broken down by geographic region. EC11. Subsidies received broken down by geographic region. EC16. Dollars of non-core business infrastructure development. This is infrastructure built outside of the main business activities of the reporting entity such as a factory building, a school, or hospital for reporter employees and their family. Indirect economic impacts EC12. Describe the organisation’s indirect economic impacts. Indirect impacts tend to be highly specific to sectors or individual organisations. The appropriate analysis will depend strongly on variables such as the size and geographic spread of the company, and the nature of its operations, products, supply chain, and customer base. - Environmental Core Materials EN1. Total materials use, other than fuel and water (tonnes or kilograms).

Non-core

Article 13 “Standards, standards, standards” Document 2 – Evidence

EN2. Percentage of materials used that are processed or unprocessed wastes from sources external to the reporting organisation (tonnes or kilograms). Refers to both postconsumer recycled material and waste from industrial sources. Energy EN3. Direct energy use (joules). Report on all energy sources used by the reporting organization for its own uses as well as for the production and delivery of energy products (e.g. electricity or heat) to other organizations. See GRI Energy Protocol (forthcoming). EN4. Indirect energy (joules). Report on all energy used to produce and deliver energy products purchased by the reporting organization (e.g. electricity or heat). See GRI Energy Protocol (forthcoming).

EN20. Initiatives to use renewable energy sources and increase energy efficiency. See GRI Energy Protocol (forthcoming).

EN21. Energy consumption (joules) footprint (i.e. annualised lifetime energy requirements) of major products. See GRI Energy Protocol (forthcoming).

EN22. Other indirect (upstream/downstream) energy use and implications, such as organizational travel, product life-cycle management, and use of energy-intensive materials. See GRI Energy Protocol (forthcoming). Water EN5. Total water use. See GRI Water Protocol (forthcoming). EN6. Total recycling and reuse of water. Includes wastewater and other used water (i.e. cooling water). See GRI Water Protocol (forthcoming).

Biodiversity EN7. Total amount of land owned, leased, or managed by the organization. EN8. Location and size of land owned, leased, or managed in biodiversity-rich habitats. Further guidance on biodiversity rich habitats may found at www.globalreporting.org (forthcoming). EN8. Location and size of land owned, leased, or managed in biodiversity-rich habitats. Further guidance on biodiversity rich habitats may found at ww.globalreporting.org (forthcoming). EN9. Description of the major impacts on biodiversity associated with the organization's activities and/or products and services in terrestrial, freshwater, and marine environments.

EN23. Identify water sources and related ecosystems/habitats significantly affected by the organisation’s use of water. Include Ramsarlisted wetlands and the overall contribution to resulting environmental trends. See GRI Water Protocol (forthcoming). EN24. Ratio of water used to rainfall available. See GRI Water Protocol (forthcoming). EN25. Annual withdrawals of ground and surface water as a percent of water available from the sources. See GRI Water Protocol (forthcoming). EN26. Amount of impermeable surface as a percentage of land purchased or leased.

EN27. Impacts of organization’s activities and operations on protected and sensitive areas (e.g. IUCN protected area categories 1- 4, world heritage sites, and biosphere reserves). EN28. Changes to natural habitats resulting from the reporting organisation’s activities and operations and percentage of habitat protected or restored. Identify type of habitat affected and its status.

Article 13 “Standards, standards, standards” Document 2 – Evidence

EN29. Objectives, programmes, and targets for protecting and restoring native ecosystems and species in degraded areas. EN30. Number of IU CN Red List species with habitats in areas affected by the reporting organisation’s operations. EN31. The proportion of current or planned business units operating in or around protected or sensitive areas. Emissions, effluents and waste EN32 Other relevant indirect greenhouse gas emissions (CO2, CH4, N2O, HFCs, PFCs, SF6). Refers to emissions that are a consequence of the activities of the reporting entity, but occur from sources owned or controlled by another entity (report in tonnes of gas and tonnes of CO2 equivalent). EN10. Greenhouse gas emissions (CO2, CH4, N2O, HFCs, PFCs, SF6). Report separate subtotals for each gas in tonnes and in tonnes of CO2 equivalent for the following: o Direct emissions from sources owned or controlled by the reporting entity o Indirect emissions from imported electricity heat or steam EN11. Ozone depleting substances emissions (report in accordance with Montreal Protocol Annexes A, B, C, and E) in tonnes of CFC-11 equivalents (ozone depleting potential). EN12. NOx, SOx, and other significant air emissions by type. Include emissions of substances regulated under: o Local laws and regulations o Montreal Protocol (Annexes A, B, C, and E) o Stockholm POPs Convention (Annex A, B, and C) – persistent organic pollutants o Rotterdam Convention on Prior Informed o Consent (PIC) o Basel Convention (Annex I, II, III and VII,) – hazardous waste Helsinki, Sofia, and Geneva Protocols to the Convention on Long-Range Transboundary Air Pollution

Article 13 “Standards, standards, standards” Document 2 – Evidence

EN13. Total amount of waste by type and destination. ‘Destination’ refers to the method by which waste is treated, including composting, reuse, recycling, recovery, incineration, or landfilling. Explain estimation method. Effluents to water EN14. Significant discharges to water by type. See GRI Water Protocol (forthcoming).

EN33. Identify all production, transport, import, or export of any waste deemed ‘hazardous’ under the terms of the Basel convention Annex I, II, III, and VIII.

EN34. Identify water sources and related ecosystems/habitats significantly affected by the organisation’s discharges of water. Include Ramsar-listed wetlands and the overall contribution to resulting environmental trends. See GRI Water Protocol.

Suppliers EN35. Performance of suppliers relative to environmental components of programmes and procedures described in response to Management Systems and Governance section of the Guidelines (Section 3). EN36. Issues identified through stakeholder consultation regarding environmental performance of the reporting organisation’s supply chain or specific suppliers. Examples include forest stewardship practices, use of genetically modified organisms, and petroleum sourced in disputed areas, etc. Describe programmes and initiatives to address such issues. Products and services EN15. Describe and quantify (where relevant) major environmental impacts at each stage of the life cycle of principle products and services. In particular, the extent to which use, consumption, storage, and/or disposal/treatment of the reporter’s products and services entails the generation, depletion, or use of: o Ozone depleting substances (listed in Annexes A, B, C, and E of the Montreal Protocol) o POPs (listed in Annex A and B of the Stockholm POPs Convention) o Substances subject to the Rotterdam Convention on PIC o Hazardous chemicals/materials according to Basel Convention (Annex I, II, III, and VIII) o Endangered species listed in CITES Appendices I-III o Greenhouse emissions covered by the Kyoto Protocol o Radioactive substances o Limited natural resources o Significant hazards or nuisances such as regulated pollutants, dust, and noise, etc.

Article 13 “Standards, standards, standards” Document 2 – Evidence

EN16. Percentage of weight/volume of products sold that are reclaimed by the reporting organisation after use. EN17. Describe product and service stewardship initiatives across the entire life cycle of the product, including efforts to improve product design and lessen impacts associated with manufacturing, use, and final disposal. Compliance EN18. Penalties for non-compliance with all applicable international declarations/conventions/treaties, and national, sub-national, regional, and local regulations associated with environmental issues. Explain in terms of countries of operation. Transport EN37. Transportation used by reporting organisation for logistical purposes. Overall EN19. Policies and procedures to minimize the environmental impacts of the reporting organisation’s operations and activities. This may include policies and procedures for issues such as biodiversity conservation and the use of environmental impact assessments, climate change, pollution prevention/waste minimization/cleaner production, etc. - Social Core Labour practices Employment and decent work LA1. Geographical breakdown of workforce by status (employee / non employee), employment type (full time / part time), and by employment contract (indefinite or permanent / fixed term or temporary). Also identify workforce retained in conjunction with other employers (temporary agency workers or workers in co-employment relationships), segmented geographically. LA2. Employment net creation and average turnover segmented by geographical area. Industrial relations LA3. Percentage of employees represented by independent trade union organizations or other bona fide employee representatives broken down geographically OR percentage of employees covered by collective bargaining agreements broken down geographically. LA4. Policy and procedures involving information, consultation, and negotiation

EN38. Environmental expenditures.

Non-core

LA10. Reporter’s contribution to social security of employees beyond those legally mandated (i.e. contributions refers to health care, disability, maternity, education, and retirement, etc.).

LA11. Participation / representation in bipartite or tripartite bodies.

LA12. Provision for formal worker representation in decision making or management including

Article 13 “Standards, standards, standards” Document 2 – Evidence

with employees over changes in the reporting entity’s operations (i.e. restructuring). Health and Safety LA5. Describe reporter practices on recording and notification of occupational accidents and diseases, and how they relate to the ILO Code of Practice on Recording and Notification of Occupational Accidents and Diseases. LA6. Existence of formal joint health and safety committees comprising management and worker representatives and proportion of workforce covered by any such committees.

Training and education LA7. Average hours of training per year per employee by category of employee (e.g. senior management, middle management, professional, technical, administrative, production, and maintenance).

corporate governance (Board of Directors).

LA13. Evidence of substantial compliance with the ILO Guidelines for Occupational Health Management Systems.

LA14. Existence of formal agreements with trade unions or other bona fide employee representatives covering health and safety at work and proportion of the workforce covered by any such agreements. LA15. Existence of policies or programmes on HIV AIDS that are in accordance with ILO guidelines. LA16. Existence of programs to support the continued employability of employees and to manage career endings.

LA17. Specific policies and programmes for skills management or for lifelong learning. LA18. Existence of positive or affirmative action policies or programmes to correct historical patterns of discrimination and thereby extend equality of opportunity and treatment in employment. Diversity and opportunity LA8. Existence of equal opportunity policies or programmes and any related policies such as those that address workplace harassment as well as monitoring systems to ensure compliance and results of monitoring. LA9. Female/male ratio in senior management and corporate governance bodies (including the Board of Directors). Human rights Strategy and management HR1. Existence and description of policies, guidelines, and procedures to deal with all aspects of human rights relevant to the reporter’s operations, including monitoring mechanisms and results. State how policies related to existing international standards such as the Universal Declaration and key ILO conventions. HR2. Description or map of organizational structure for human rights compliance and key offices or individuals responsible.

HR8. Evidence of consideration of human rights impacts as part of reporter's operational investment decisions and selection of suppliers/contractors.

HR9. Employees training on the reporter’s policies and practices concerning all aspects of human rights relevant to the reporter’s operations. Include type of training, number of employees trained, and average training duration.

Article 13 “Standards, standards, standards” Document 2 – Evidence

Non-discrimination HR3. Existence and description of global policy and procedures/programs excluding discrimination in reporter’s operations, including monitoring systems and results of monitoring. Freedom of association and collective bargaining HR4. Existence and description of freedom of association policy and extent to which this policy is universally applied independently of local laws, as well as description of procedures/programs to address this issue. Child labour HR10. Number of children working for reporter, HR5. Existence and description of policy by type of job. See GRI Child Labour Protocol excluding child labour as defined by the (forthcoming). ILO Convention 138 and extent to which this policy is visibly stated and applied as well as description of procedures/programs to address this issue, including monitoring systems and results of monitoring. See GRI Child Labour Protocol (forthcoming). HR11. Average weekly working and schooling hours of children. See GRI Child Labour Protocol (forthcoming). Forced and compulsory labour HR6. Existence and description of policy to prevent forced and compulsory labour and extent to which this policy is visibly stated and applied as well as description of procedures/programs to address this issue, including monitoring systems and results of monitoring. Disciplinary practices HR12. Description of implemented appeal practices (representation and appeals process). HR13. Existence of on-retaliation policy and effective, confidential employee grievance system. Security practices HR14. Human rights training for security personnel. Include type of training, number of persons trained, and average training duration. Indigenous rights HR15. Existence of jointly managed community grievance mechanisms/authority. HR16. Documented management principles regarding indigenous people. HR17. Share of operating revenues from the area of operations that are re-distributed to local communities. General HR7. Description of policies and procedures to evaluate and address human rights performance within the reporting organisation’s supply chain and contractors, including monitoring systems

Article 13 “Standards, standards, standards” Document 2 – Evidence

and results of monitoring. Human rights performance refers to the aspects of human rights identified as reporting aspects in the GRI performance indicators. Society Customer health and safety SO1. Existence and description of policy for preserving customer health and safety during use of reporting organisation’s products and services, and extent to which this policy is visibly stated and applied, as well as description of procedures/programs to address this issue including monitoring systems and results of monitoring. Explain rationale for any use of multiple standards in marketing and sales of products.

SO11. Number and type of instances of non compliance with regulations concerning customer health and safety (over a set time period), including the penalties and fines assessed for these breaches.

SO12. Number of complaints upheld by regulatory or similar official bodies to oversee or regulate the health and safety of the reporting organisation’s products and services. SO13. Voluntary code compliance, product labels or awards with respect to social and/or environmental responsibility that the reporter is qualified to use or has received. Include explanation of the process and criteria involved. Product and services declaration SO2. Existence and description of reporting organisation’s policy, procedures/management systems, and compliance mechanisms related to product information and labelling.

Advertising SO3. Existence and description of reporting organisation’s advertising policy, procedures/management systems, and compliance mechanisms with respect to standards for social and environmental responsibility. Identify geographic areas covered by policy.

SO14. Number and type of instances of non compliance with regulations concerning product information and labelling (over a set time period), including the penalties, including fines, assessed for these breaches. SO15. Reporting organisation’s adherence to voluntary codes regarding social and environmental responsibility in advertising where applicable. SO16. Number and types of breaches of advertising and marketing regulations.

SO17. The number of substantiated complaints regarding breaches of customer privacy over the past 3 years. Respect for privacy SO4. Description of reporting organisation’s policy, procedures/management systems, and compliance mechanisms for customer privacy to ensure that data is not circulated without the explicit consent of the concerned customers. Identify geographic areas covered by policy.

Article 13 “Standards, standards, standards” Document 2 – Evidence

SO5. Existence and description of reporting organisation’s policy, procedures/management systems, and compliance mechanisms related to customer satisfaction, including results of surveys measuring consumer satisfaction. Identify geographic areas covered by policy. Bribery and corruption SO6. Description of reporting organisation’s policy, procedures/management systems, and compliance mechanisms for organizations and employees regarding bribery and corruption, including a description of how the organisation meets the requirements of the OECD Convention on Combating Bribery. Political contributions SO7. Description of reporting organisation’s policy, procedures/management systems, and compliance mechanisms for managing political lobbying and contributions. Public policy

SO18. Amount of money paid by the reporter to political parties and institutions whose prime function is to fund political parties or their candidates.

SO19. Identify membership in or support of national and international advocacy organizations (including business associations) and changes in membership over the past 3 years.

SO20. Court decisions regarding cases pertaining to antitrust and monopoly regulations. Competition and pricing SO8. Description of reporting organisation’s policy, procedures/management systems, and compliance mechanisms for preventing anti-competitive behaviour Corporate citizenship SO21. Involvement and/or contributions of reporting organisation to projects with value to the greater community (e.g. support of education and training programs, and humanitarian programs, etc.). SO22. Awards received relevant to the reporting organisation’s social, ethical, and environmental performance. Community SO9. Existence and description of Community Impact Policy, and extent to which this policy is visibly stated and applied, as well as description of procedures/programs to address this issue including monitoring systems and results of monitoring SO10. Describe reporting organisation’s policies and procedures for identifying and engaging in dialogue with community stakeholders in areas affected by the reporting organisation’s activities.

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How do I need to look at it? AREAS - Reporting principles that promote rigorous reporting and underlie the application of the guidelines - Governance structure and management systems o Structure and governance o Stakeholder Engagement o Overarching policies o Management systems INDICATORS - Principles of reporting: o Completeness o Inclusivity o Consistency o Accuracy o Clarity o Neutrality o Timeliness o Auditability o Transparency o Sustainability Context - Governance structure and management systems o Structure and governance Operational structure Board leadership to manage social/environmental risks Board member responsibility for setting sustainability strategy Incentives for achievement of non-financial goals Organisational structure and key individuals responsible for environmental, social and economic policies Approaches to measurement and quality management Economic, social and environmental risk management systems Adoption of codes of conduct Shareholder resolution policies o Stakeholder Engagement basis for definition and selection of major stakeholders approaches to stakeholder consulted reported in terms of frequency of consultations by type type of information generated by stakeholder consultations use of information resulting from stakeholder engagements o Overarching policies Publicly available mission and values statements and policies with environmental, economic and social provisions How the precautionary principle is addressed by company policies Any voluntary charters, principles etc. Principle industry and business association memberships Supply chain policies Policies regarding decisions on location and change in operation o Management systems Programmes and procedures on environmental, economic and social performance including a) Setting priorities and targets b) Major programmes to improve performance c) Monitoring performance d) Internal and external auditing e) Senior management review Status of certification on economic, environmental and social management systems Source/Organisation The Coalition for Environmentally Responsible Economies (CERES), in collaboration with the Tellus Institute, convened the GRI in late 1997. Shortly thereafter, the United Nations Environment Programme joined the GRI as a key partner, along with business, accountancy, environmental, human rights, and labour organisations from around the world Article 13 â&#x20AC;&#x153;Standards, standards, standardsâ&#x20AC;? Document 2 â&#x20AC;&#x201C; Evidence

5. OECD Guidelines for Multinational Enterprises Mission and scope The OECD Guidelines are recommendations addressed by governments to multinational enterprises. They provide voluntary principles and standards for responsible business conduct consistent with applicable laws. Stakeholder focus - Targetted at multinational corporations and their relations with local communities, local authorities and local industry and educational institutions Best practice No evidence What do I need to look at? AREAS - Employment and industrial relations - Environment - Combating bribery - Consumer interests - Science and Technology - Competition - Taxation RECOMMENDATIONS 1. Disclosure - Enterprises should ensure that timely, regular and relevant information is disclosed regarding their activities, structure, financial situation and performance - Enterprises should apply high quality of disclosure, accounting and auditing. Enterprises are also encouraged to apply high standards of disclosure for nonfinancial information including environmental and social reporting where they exist. - Enterprises should disclose basic information showing their name, location, structure, address and telephone number of the parent company and main affiliates. - Enterprises should also disclose material information on : - Financial and operating results of the company - Company objectives - Major share ownership and voting right - Members of the board and key executives and their remuneration - Material foreseeable risk factors - Material issues regarding employees and other stakeholders - Governance structures and policies - Enterprises are encouraged to communicate additional information that could include: - Value statements of business conduct intended for public disclosure, including information on social, ethical and environmental policies and codes of conduct - Information on systems for managing risks and complying with laws and on statements or codes of business conduct - Information on relationships with employees and other stakeholder 2. Employment and industrial relations - Respect employee rights of freedom of association, - Contribute to abolition of child labour - Contribute to elimination of forced or compulsory labour - Non-discrimination of employees on grounds such as race, colour, se, religion, political opinion, national extraction or social origin - Provide facilities to assist employee representation and collective agreements

Article 13 â&#x20AC;&#x153;Standards, standards, standardsâ&#x20AC;? Document 2 â&#x20AC;&#x201C; Evidence

Provide information to employee representation needed for meaningful negotiations on employment conditions - Promote consultation and co-operation between employers and employees - Provide information to employees on organisational/company performance - Observe standards of employment and industrial relations not less favourable than those observed in the host country - Take adequate steps to ensure occupational health and safety - Employ local personnel as far as possible and provide training with a view to improve skill levels - Provide reasonable notice of significant organisational change, in particular closure and dismissal - Not threaten to transfer whole or part of an operating unit from an area in the context of employee negotiations 3. Environment - Take due account of the need to protect the environment, public health and safety, and generally to conduct their activities in a manner contributing to the wider goal of sustainable development - Establish and maintain a system of environmental management including: o Collection and evaluation of information regarding HSE impacts o Establishment of measurable objectives and where appropriate, targets fro improved environmental performance , including periodically reviewing o Regular monitoring and verification of progress on targets - Provide the public and employees with adequate information of potential environment, heath and safety impacts - Engage in communication and consultation with communities directly affected by the environment, health and safety policies of the enterprise - Assess and address life-cycle impacts of products, goods and services in terms of environment, health and safety - Maintain contingency plans for preventing, mitigating and controlling serious environmental and health damage from operations, including accidents, emergencies - Seek continual improvement towards best practice - Seek progress towards products and services that have no undue environmental impact - Promote higher levels of awareness among customers of the environmental impact of using products - Contribute to development of environmentally meaningful and economic efficient public policy 4. Combating bribery - Enterprises should not, directly or indirectly offer, promise, give of demand a bribe o other undue advantage to obtain or retain business. Nor should enterprises be unduly solicited or expected to render a bribe - Subcontracts , purchase orders or consulting agreements should not be used as a channel of payment to public officials to employees of business partners or their relatives or business s associates - Ensure that remuneration of agents is appropriate and for legitimate services only - Enhance transparency of their activities in the fight against bribery and extortion - Promote employee awareness of and compliance with company policies against bribery through training programmes and disciplinary procedures - Adopt management control systems that discourage bribery and corrupt practice, and adopt financial and tax accounting and auditing practices that prevent the establishment of “off the books” or secret accounts - Not make illegal contributions to candidates for public office or to political parties or other political organisations. 5. Consumer interests - Enterprises should act in accordance with fair business, marketing and advertising practices and should ensure the safety and quality of the goods and services they provide - Ensure goods/services meet legally required standards for consumer health and safety, including health warnings and product safety and information labels -

Article 13 “Standards, standards, standards” Document 2 – Evidence

Provide accurate and clear information regarding content, safe use, maintenance , storage and disposal - Provide transpired and effective procedures that address consumer complaints and contribute to fair an timely resolution of consumer disputes - Not make representations, omissions or any other practices that are deceptive, fraudulent, misleading or unfair - Respect consumer privacy - Co-operate with public authorities in the prevention of serious threats to public health and safety deriving from consumption or use of the products 6. Science and Technology - Company activities should comply with science and technology policies of countries in which they operate - Adopt where possible practice which permits the transfer of technologies and knowhow with due regard of intellectual property rights - Where possible, perform science and technology development work in host countries to address local market needs - When granting licences for use of intellectual property rights, do so on reasonable terms and in a manner that contributes to the long term development prospects of the host country - Where relevant to commercial objectives, develop ties with local universities, public research institutions and participate in co-operative research projects with local industry or industry associations 7. Competition - Enterprises should conduct their activities in a competitive manner, in particular - Refrain from entering into or carrying out anti-competitive agreements among competitors: To fix prices To make rigged bids To establish output restrictions/quotas To share or divide markets by allocating customers, suppliers, territories or lines of commerce - Conduct all activities within applicable competition laws, taking into account the applicability of the competition laws of jurisdiction whose economies are likely to be harmed by anti-competitive activity on their part - Co-operate with the competition authorities of such jurisdictions - Promote employee awareness of the importance of compliance with all applicable competition law and policies 8. Taxation - Enterprises should comply with the tax laws and regulations in all countries win which they operate and should exert every effort to act in accordance with both the letter and spirit of those laws and regulations. -

How do I need to look at it? AREAS Implementation Procedures of the OECD Guidelines for Multinational Enterprises 1. National Contact Points 2. Committee on International Investment and Multinational Enterprises INDICATORS (no evidence) Source/Organisation Organisation for Economic Co-operation and Development

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6. Just Pensions – A guide for Trustees and Fund Managers Mission and scope Provides advice for trustees wishing to introduce SRI policies. Stakeholder focus Guidance for trustees and fund managers Best practice N/a What do I need to look at? AREAS Corruption • Does the company have a policy of not paying bribes in order to win contracts? • Is the award of subcontracts carried out in such a way as to render impossible the recovery of 'backhanders'? • Does the company pay its agents on a basis which reflects actual services rendered and ensures that no part of agents' fees are paid to a third party? • Are all agents representing the company required to confirm that they fully understand, and are committed to, the company's anti-corruption policy? • In the case of joint ventures, does the company make every effort to ensure that its partner is fully aware of its anti-corruption strategy and will not make any payment which may undermine it? • Are there clear guidelines for the giving and receiving of gifts and entertainment, with such payments openly declared to senior management? • Does the company make payments to political parties? If so, what steps does it take to ensure that such payments are not made in order to obtain business or other commercial benefits? Are all such contributions publicly reported by the parent company? • Will the company commit to voluntary (i.e. non-statutory) additional disclosure of revenues, profits and capital employed by country, instead of by region? Labour standards • Is your code of conduct based on the core ILO conventions? If not, which issues are missing? • Does it apply to all or only part of your supply chain. If the latter, what proportion of your supply chain is covered? • How is the code communicated to suppliers and subcontractors? • What policies are in place for the welfare of under-age workers if they are found in supply chains? • To what extent have the policies been discussed with/explained to employees? Conflict • Has the risk to local communities affected by the business been assessed? What knowledge has been sought and from whom? • Did the company seek to mitigate any negative impacts? • Does the company undertake training of all personnel and subcontractors on these issues? • Is the company involved in any development initiatives in conflict areas? • Does the company report against impact on conflict or potential conflict? If the company's presence in a particular area is perceived to be leading to deterioration in the conflict, does it have any means of acting promptly?

Article 13 “Standards, standards, standards” Document 2 – Evidence

Human rights • Does the firm explicitly incorporate the UN UDHR, associated treaties and protocols, and a commitment to abide by national human rights requirements into its business principles and practice? • Are country managers required to demonstrate that the company has taken steps to avoid complicity in human rights violations; e.g. through an annual letter of assurance to the Board? • Are human rights impact assessments integrated into pre-investment risk analysis and into every element of the project cycle including employment practices, use of natural resources which local communities depend upon, production, waste disposal, marketing and asset protection? • Is the company committed to raising human rights concerns with host governments? Where quiet diplomacy fails, is the company prepared to speak out publicly either alone or in concert with other companies? Access to medicines • Does your company have a written policy on maximising access to quality medicines in developing countries? E.g. differentiated patent enforcement; tiered pricing according to ability to pay/public health needs. Is it publicly available? • Does your Board consult with independent public health specialists from developing countries on the impact of your practices on public health priorities? • Do you report on your written policy? If so, do you evaluate performance against policy by providing information about why intentions to make available particular drugs in specific markets succeeded or failed? Do you provide clear disaggregated information about the percentage of total R&D expenditure that is dedicated to tropical diseases? • Is your company involved in any legal or trade dispute relating to protection of intellectual property rights in a developing country? If so, what evaluation has been done to assess the negative reputation risk this may constitute? • Does your company monitor the application of internationally agreed ethical standards to clinical trials in developing countries? e.g. WHO Guidelines for Good Clinical Practice for Trials on Pharmaceutical Products? Do you allow for third party verification?

How do I need to look at it? AREAS 1. Getting engaged: A toolkit for trustees - Private methods of exerting influence • Raising social issues/questions in routine meetings between investors and company management • Writing to company management about issues of concern • Arranging special meetings to discuss these matters • Writing to other shareholders to express concern • Joining with other like-minded investors to undertake some or all of above - Public methods • Attendance at annual general meetings to ask questions • Proposing shareholders resolutions • Exercising voting rights • Calling an extraordinary general meeting • Issue press briefings - Issues to consider • Should policy development and engagement be conducted internally (within the company) or externally (by pension fund trustees)? • Willingness to engage • Engagement process to be used • Programme of activity - Identify general and priority issues

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• • • •

Develop a policy for dealing with conflicts of interest Clarify decision-making process and measures of success Identify reporting mechanisms Identify review mechanisms

2. Guide to company best practice General - Risk assessment • Procedures in place to assess risk in current and proposed operations? • Does risk assessment include company’s joint venture partners, suppliers, subcontractors? • What sources of information does the company use to inform this process? • What level of dialogue is there with other relevant bodies? • What court cases or negative press coverage has the company or its joint venture partners, subcontractors and suppliers been involved with in recent years on this issue? - Establishing properly monitored policies • Does the company have a written policy on the issue? • Does the company have a written policy on the issue, available to the public? • Does it set targets and improvement strategies? • Is the performance of the policy internally monitored and independently verified? • What level of training is carried out for staff, both at headquarters and incountry? • What are the numbers and seniority of staff employed to implement the policy? • Is there a secure and accessible system in place enabling employees or local communities safely to raise breaches of the policy with management? - Reporting and responsibility • Is there a named board level individual with overall responsibility for overseeing the design and implementation of the policy? • What level of reporting, both internal and public, is conducted? • Is there a feedback mechanism? (e.g. Shell's 'Tell Shell' programme) Source/Organisation Just Pension Project, a two year project funded by Community Fund and Traidcraft Exchange and War on Want

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7. SIGMA Guidelines (Sustainability Integrated Guidelines for Management) Mission and scope For organisations to develop an integrated approach to managing sustainability. Brings together the following standards: Balanced Scorecard, The Natural Step, GRI and AA1000s Stakeholder focus Employees, Customers/Members, Suppliers, Community, Shareholders, Government and Civil society Best practice Currently being piloted in organisations in the UK What do I need to look at? AREAS SIGMA Principles: - Accountability - Capital enhancement - Environmental sustainability - Key stakeholders INDICATORS - no evidence How do I need to look at it? AREAS SIGMA Management Framework - Sensitisation and Awareness - Baseline Review - Actions, Impacts and Outcomes - Legal, Regulatory and Other Requirements - Strategic Planning - Tactical Planning - Communication and Training - Control and Influence - Monitoring, Objective Evidence, Feedback - Reporting Progress, Tactical and Strategic Review INDICATORS Approaches to indicators and measurement: - The SIGMA Management Framework Benchmark Questionnaire - The SIGMA Sustainability Scorecard - A stakeholder engagement tool based on the AA1000 process - The Global Reporting Initiative’s approach to performance measurement and sustainability reporting - An approach to environmental accounting Source / organisation SIGMA, The UK Department of Trade and Industry (DTI), UK Department of Environment, Food and Rural Affairs (DEFRA)

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8. UK CSR Mission and scope “This report provides an update on the Government’s perspective on corporate social responsibility (CSR)… The Government has an ambitious vision for CSR: to see private, voluntary and public sector organisations in the UK take account of their economic, social and environmental impacts, and take complementary action to address key challenges based on their core competences – locally, regionally, nationally and internationally.” Stakeholder focus ‘Consult with stakeholders’ is a specific process consideration in 2001’s study but not 2002. Best practice Companies profiled in report include Camelot, BT, Ford, HMG What do I need to look at? AREAS - Working in partnership - Economic, social and environmental aims - Neighbourhood renewal - Enabling community action - Driving up skills and education levels - Engaging smaller organisations - Getting the message across INDICATORS (Anecdotal mention of indicators such as adult literacy, and investment in communities – case study approach). However, indicators are available from public bodies: - The Department for Environment, Food and Rural Affairs (DEFRA) provides guidelines for environmental reporting at http://www.defra.gov.uk/environment/envrp/general/index.htm separate guidelines on how to measure and report on three key impacts common to all companies, greenhouse gas emissions at http://www.defra.gov.uk/environment/envrp/gas/index.htm, waste at http://www.defra.gov.uk/environment/envrp/waste/index.htm, and water use at http://www.defra.gov.uk/environment/envrp/water/index.htm The South East England Regional Assembly lays out clear objective and targets in its ‘Framework for a Sustainable Future’ at http://www.southeastra.gov.uk/regional_policies/sustainable_development/sdf_summary.pdf How do I need to look at it? (from 2001 study) AREAS

Initial commitment Identify external concerns and relate to business Review strategy and plan actions Implement Measure and report results Consult with stakeholders

INDICATORS No evidence Source/Organisation ‘Business and Society, Corporate social responsibility report 2002’, published by the Department for Trade and Industry, May 2002. Plus reference to ‘Business and Society, Developing corporate social responsibility in the UK’, published by the Department for Trade and Industry, March 2001

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9a. EU CSR – Green Paper “Promoting a European Framework for Corporate Social Responsibility Mission and scope “This Green Paper aims to launch a wide debate on how the European Union could promote corporate social responsibility at both the European and international level, in particular on how to make the most of existing experiences, to encourage the development of innovative practices, to bring greater transparency and to increase the reliability of evaluation and validation.” It suggests an approach based on the deepening of partnerships in which all actors have an active role to play. Stakeholder focus Not explicitly Best practice N/e What do I need to look at? AREAS - Corporate social responsibility: the internal dimension o Human resources management o Health and safety at work o Adaptation to change o Management of environmental impacts and natural resources - Corporate social responsibility: the external dimension o Local communities o Business partners, suppliers and consumers o Human rights o Global environmental concerns INDICATORS - NA How do I need to look at it? AREAS - Social responsibility integrated management - Social responsibility reporting and auditing - Quality in work - Social and eco-labels - Social responsible investment INDICATORS - NA Source/Organisation EU Green Paper ‘Promoting a European framework for corporate social responsibility’, July 2001

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9b. EU CSR – A business contribution to Sustainable Development Mission and scope In this ‘Communication, the European Commission presents a EU strategy to promote CSR. It is “addressed to the European institutions, Member States, Social Partners as well as business and consumer associations, individual enterprises and other concerned parties, as the European strategy to promote CSR can only be further developed and implemented through their joint efforts. The Commission invites enterprises and their stakeholders as well as Social Partners in candidate countries to join this initiative.” Stakeholder focus Chapter 5 of the Communication is concerned with the launch of a EU Multi-Stakeholder Forum on CSR, and it is referred to throughout. Best practice No evidence What do I need to look at? AREAS - Promoting convergence and transparency of CSR practices and tools o Codes of Conduct o Management Standards o Measurement, Reporting and Assurance o Labels o Socially Responsible Investment INDICATORS - NA How do I need to look at it? AREAS - Codes of Conduct should: o Be built on ILO Conventions and OECD guidelines o Include evaluation and verification of implementation, and compliance o Involve social partners and other relevant stakeholders o Disseminate experience of good practice of European enterprises - Management Standards o Recommends use of EMAS - Measurement, Reporting and Assurance o Invites publicly-quoted companies with over 500 staff to publish a ‘triple bottom line’ in reports - Labels o Schemes should be voluntary o Labels should be implemented in an objective, transparent, credible and nondiscriminatory manner, respecting EU international obligations and applicable competition rules o ILO core labour conventions should constitute a minimum baseline for label schemes - Socially Responsible Investment o Invites occupational pension schemes and retail investment funds to disclose whether and how they take account of social, environmental and ethical factors in their investment decisions o Encourages initiatives aiming at monitoring and benchmarking pension and investment funds Source/Organisation European Union Employment and Social Affairs Directorate, EU Corporate Social Responsibility – A business contribution to sustainable development, 2002

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10. Global Sullivan Principles Mission and scope "The objectives of the Global Sullivan Principles are to support economic, social and political justice by companies where they do business; to support human rights and to encourage equal opportunity at all levels of employment, including racial and gender diversity on decision making committees and boards; to train and advance disadvantaged workers for technical, supervisory and management opportunities; and to assist with greater tolerance and understanding among peoples; thereby, helping to improve the quality of life for communities, workers and children with dignity and equality.” Stakeholder focus Not explicitly Best practice N/e What do I need to look at? AREAS - Support for universal human rights - Promote equal opportunity for employees and operate without unacceptable worker treatment - Respect employees' voluntary freedom of association - Compensate employees to enable them to meet basic needs and provide the opportunity to improve skill and capability in order to raise social and economic opportunities - Provide a safe and healthy workplace; protect human health and the environment; and promote sustainable development. - Promote fair competition including respect for intellectual and other property rights, and not offer, pay or accept bribes. - Work with governments and communities in which operate to improve the quality of life in those communities and seek to provide training and opportunities for workers from disadvantaged backgrounds - Promote the application of these Principles with those who do business with INDICATORS - NA How do I need to look at it? AREAS - NA INDICATORS - NA Source/Organisation http://globalsullivanprinciples.org/principles.htm, 2.10.2002, Global Sullivan Principles of Social Responsibility Organisation

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11. UN Global Compact Mission and scope At the World Economic Forum, Davos, on 31 January 1999, UN Secretary-General Kofi A. Annan challenged world business leaders to "embrace and enact" the Global Compact, both in their individual corporate practices and by supporting appropriate public policies. These principles cover topics in human rights, labour and environment. Stakeholder focus N/e Best practice N/e What do I need to look at? AREAS - Human Rights o Support and respect protection of international human rights within sphere of influence o Make sure own corporation not complicit in human rights abuses - Labour o Freedom of association and the effective recognition of the right to collective bargaining o Elimination of all forms of forced and compulsory labour o Effective abolition of child labour o Elimination of discrimination in respect of employment and occupation - Environment o Support precautionary approach to environmental challenges o Undertake initiatives to promote greater environmental responsibility o Encourage the development and diffusion of environmentally friendly technologies. INDICATORS - NA How do I need to look at it? AREAS - NA Source/Organisation The United Nations, http://65.214.34.30/un/gc/unweb.nsf/

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12. GoodCorporation Charter Mission and scope GoodCorporation is a global standard of corporate responsibility that helps organisations of all types and sizes to develop, manage and monitor good working practices. Based on a set of core principles devised by the Institute of Business Ethics, the standard sets out a framework of policies and practices against which an organisation can measure how effectively it is meeting these goals. Stakeholder focus It covers an organisation’s responsibility and fairness to its employees, suppliers, customers, and providers of finance, as well as its community and environmental impacts. Best practice N/e What do I need to look at? AREAS Employees - We provide clear and fair terms of employment. - We provide clean, healthy and safe working conditions. - We have a fair remuneration policy everywhere we operate. - We strive for equal opportunities for all present and potential employees. - We encourage employees to develop skills and progress in their careers. - We do not tolerate any sexual, physical or mental harassment of our employees. - We provide clean, healthy and safe working conditions. - We do not discriminate on grounds of colour, ethnic origin, gender, age, religion, political or other opinion, disability or sexual orientation. - We do not employ underage staff. Customers - We seek to be honest and fair in our relationships with our customers. - We provide the standards of products and services that have been agreed. - We take all reasonable steps to ensure the safety and quality of the goods and services we provide. Suppliers and sub contractors - We seek to be honest and fair in our relationships with our suppliers and subcontractors. - We pay suppliers and subcontractors in accordance with agreed terms. - We have a policy not to offer, pay or accept bribes or substantial favours. - We encourage suppliers and subcontractors to abide by the principles of this Charter Community and Environment - We aim to make the communities in which we work better places to live and do business. - We aim to be sensitive to the local community’s cultural, social and economic needs. - We endeavour to protect and preserve the environment where we operate. Shareholders and other suppliers of finance - We are financially accountable to our shareholders. - We communicate to shareholders all matters that are material to an understanding of the future prospects of the organisation. - We aim to protect shareholders’ funds, manage risks and ensure that funds are used as agreed. Management Commitment - We will do all in our power to conform to the letter and spirit of this Charter. INDICATORS - N/e How do I need to look at it?

Article 13 “Standards, standards, standards” Document 2 – Evidence

AREAS

Put policy in place Put in place system to implement policy Ensure there are records showing that system works in practice

INDICATORS - Stakeholders, when asked, agree system is working Source/Organisation - GoodCorporation - (Institute of Business Ethics)

Article 13 “Standards, standards, standards” Document 2 – Evidence

13. Amnesty International Human Rights Principles for Companies Mission and scope This introductory checklist is intended as a working document which will be revised and updated on the basis of discussion and experience. AI welcomes comments on all these principles from companies, trade unions, non-governmental organizations and others Stakeholder focus Not specifically, though does refer to community engagement Best practice N/e What do I need to look at? AREAS - Company policy on human rights (including public support for the Universal Declaration of Human Rights) - Security arrangements to protect Human Rights - Community engagement (reasonable steps to ensure operations do not have negative impact on Human Rights) - Freedom from discrimination - Freedom from slavery - Safe and healthy working conditions - Freedom of association and collective bargaining - Fair working conditions - Not engage in or support use of child labour - Mechanism to monitor effectively operations’ compliance with codes of conduct and international Human Rights Standards INDICATORS - NA How do I need to look at it? AREAS - NA Source/Organisation - United Nations Universal Declaration of Human Rights (UDHR), preamble Organization for Economic Cooperation and Development(OECD) Guidelines for Multinational Enterprises. - UN Code of Conduct for Law Enforcement Officials, UDHR Articles 3, 5, and 9 UP Basic Prinicples on the Use of Force and Firearms by Law Enforcement Officials Principles Governing Conventional Arms Transfers of the Oraganization for Security Cooperation in Europe UDHR Articles 21, and 26 International Labor Organization (ILO) Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy - UDHR Article 2, ILO Conventions 100,111, and l65 - UDHR Article 4, ILO Convention 29,105, and 138 - UDHR Article 3, ILO Convention 155 - UDHR Articles 20, and 23 ILO Conventions 87, 98, and 135 - UDHR Articles 23, and 24 ILO Convention including 95 and 131 (on wages), 14 and lO6 (on weekly rest), and l32 (on holidays with pay) - ILO Conventions 138,146

Article 13 “Standards, standards, standards” Document 2 – Evidence

14. The London Principles Mission and scope The 'London Principles' aims to raise support and awareness among mainstream financial institutions of the sound business reasons for implementing sustainable finance principles, through: Identifying financial product, process and market innovations that address sustainable development risks and opportunities Drawing out of this experience lessons for future innovation by both financial institutions and government Putting in place mechanisms to ensure continuing progress in the financing of sustainable development by UK-based financial institutions. Stakeholder focus Not explicitly Best practice N/a What do I need to look at? AREAS - Economic prosperity - Environmental protection - Social development INDICATORS -

Economic prosperity o Principle 1: Provide access to finance and risk management products for investment, innovation and the most efficient use of existing assets o Principle 2: Promote transparency and high standards of corporate governance in themselves and in the activities being financed Environmental protection o Principle 3: Reflect the cost of environmental and social risks in the pricing of financial and risk management products o Principle 4: Exercise equity ownership to promote efficient and sustainable asset use and risk management o Principle 5: Provide access to finance for the development of environmentally beneficial technologies Social development o Principle 6: Exercise equity ownership to promote high standards of corporate social responsibility by the activities being financed o Principle 7: Provide access to market finance and risk management products to businesses in disadvantaged communities and developing economies

How do I need to look at it? AREAS - NA Source/Organisation Financing the Future, The London Principles, Corporation of London 2002 (other organisations involved are DEFRA and Forum for the Future’s Centre for Sustainable Investment)

Article 13 “Standards, standards, standards” Document 2 – Evidence

15. AA1000 Mission and scope Process standard comprising both principle and processes, used as “common currency” to underpin the quality of specialised accountability standards; and as a stand-alone system and process for managing and communicating social and ethical accountability and performance. Stakeholder focus Stakeholder engagement is explicit part of process Best practice N/e What do I need to look at? AREAS - Principles are accountability and inclusivity: o Scope o Completeness o Evidence o Controls o Understanding and Comparability o Responsiveness INDICATORS - “The AA1000 standard outlines a process by which key performance indicators are identified by an organisation through engagement with its stakeholders”. As such, indicators are not provided but the process is ‘matched’ against other standards e.g. GRI. How do I need to look at it? AREAS - Stakeholder engagement o Planning Establish commitment Identify stakeholders Define/Review values o Accounting Identify issues Determine SEAAR scope Identify indicators Collect information Analyse information, set targets and develop improvement plan o Auditing Audit report(s) o Reporting Communicate report(s) and obtain feedback Prepare report(s) o Embedding Establish and embed systems Source/Organisation “AccountAbility 1000 (AA1000) framework – standard, guidelines and professional qualifications”, Exposure Draft, November 1999 “Consultation Brief”, March 2002 – the new AA1000 series will be launched during Spring 2002

Article 13 “Standards, standards, standards” Document 2 – Evidence

16. The Natural Step Framework Mission and scope “In an effort to provide a practical tool for assessing decisions in terms of sustainability, The Natural Step Framework was created. The TNS Framework describes core guiding principles for moving toward sustainability. It is intended to assist decision-makers by providing a pragmatic analytical tool for understanding and integrating sustainability principles into complex organizations.” Stakeholder focus No Best practice N/e What do I need to look at? AREAS - Eliminate our contribution to systematic increases in concentrations of substances from Earth’s crust - Eliminate our contribution to systematic increases in concentrations of substances produced by society - Eliminate contribution to systematic physical degradation of nature through overharvesting, introductions and other forms of modification - Contribute as much as we can to the meeting of human needs in our society and worldwide, over and above all the substitution and dematerialisation measures taken in meeting the first three objectives INDICATORS - NA How do I need to look at it? AREAS - Awareness (align your organisation around a common understanding of the situation) - Baseline mapping (what does your organisation look like today?) - Clear vision (what does your organisation look like in a sustainable society) - Down to action (Prioritise and manage your opportunities) Source/Organisation The Natural Step, http://www.naturalstep.org/index.html

Article 13 “Standards, standards, standards” Document 2 – Evidence

17. London Benchmarking Group Mission and scope “The London Benchmarking Group and its model for the management and measurement of corporate community involvement, have been helping member companies effectively assess and target their community programmes since 1994.” Run by its members but managed by The Corporate Citizenship Company and formally linked to the Corporate Responsibility Group. Stakeholder focus Yes, as the model is designed to manage, measure and compare members’ relationship with the community. Best practice Over 50 members, with case studies on how BT, Telecom Italia, GSK, What do I need to look at? AREAS - Community involvement - Charitable gifts - Community investment - Commercial initiatives in the community INDICATORS - Inputs: o Cash value (of programme) - Outputs: o Leverage o Community benefits o Business benefits How do I need to look at it? AREAS - NA Source/Organisation The London Benchmarking Group, http://www.lbg-online.net

Article 13 “Standards, standards, standards” Document 2 – Evidence

18. Bench Marks – Principles for Global Corporate Principles Mission and scope Bench Marks is a comprehensive set of social and environmental criteria and business performance indicators drawn from a body of internationally recognized human rights, labour and environmental standards and principles. Stakeholder focus Ecosystems, National Communities, Local Communities, Indigenous Communities Best practice - no evidence What do I need to look at? AREAS - The Employed – Conditions - The Employed – Persons - Women in the Workforce - Minority Groups - Persons with Disabilities - Child Labour - Forced Labour - Suppliers - Financial Integrity - Ethical Integrity - The Shareholders - Joint Ventures, Partnerships, Subsidiaries - Customers & Consumers INDICATORS No evidence How do I need to look at it? AREAS - NA Source/Organisation The Taskforce on the Churches and Corporate Responsibility

Article 13 “Standards, standards, standards” Document 2 – Evidence

19. SA8000 Mission and scope The standard specifies requirements for social accountability to enable a company to: (a) develop, maintain, and enforce policies and procedures in order to manage those issues which it can control or influence; (b) demonstrate to interested parties that policies, procedures, and practices are in conformity with the requirements of this standard. Stakeholder focus

Best practice

What do I need to look at? AREAS - Child labour - Forced labour - Health and Safety - Freedom of association and right to collective bargaining - Discrimination - Working hours - Remuneration INDICATORS - Child Labour o No child labour o Process for remediation of children found engaged in child labour o Promotion of education for children under ILO recommendations o No exposure of children to hazardous, unsafe, unhealthy situations o Conform to provisions of ILO standards o Abolishing child labour and forced labour -

Forced labour o No forced labour o Workers not required to lodge deposits or identity papers

Health and Safety o Planning for accidents and emergencies o Safe and hygienic, or healthy, working environment o Accountable senior management responsible o Clean and safe sleeping arrangements o Clean bathrooms, water and sanitary food storage o Regular, recorded health and safety training for all personnel o Systems to avoid health and safety threat

Freedom of association and right to collective bargaining o Trade unions and collective bargaining o Facilitate parallel means where law restricts these rights o Non-discrimination of employee representatives o Open attitude towards activities of trade unions

Discrimination o No sexual harassment o No discrimination in hiring, promotion, training and termination of employment o Allow employee to observe practices (race, religion)

Article 13 “Standards, standards, standards” Document 2 – Evidence

Working hours o Compliance with applicable law and industry standard o Not over 48 hours a week

Remuneration o Meet legal minimum standards and basic needs plus discretionary income o No deductions for disciplinary purposes. o Remuneration detailed clearly and regularly o Overtime should be voluntary o Fulfil full labour and social security obligations towards personnel

How do I need to look at it? AREAS - Management systems o Addressing concerns and taking corrective action o Planning and implementation: requirements understood at all levels o Company representatives from senior management and non-management personnel o Policy for social accountability and labour issues by top management o Management review by top management Source/Organisation Social Accountability 8000, http://www.sa8000.org

Article 13 â&#x20AC;&#x153;Standards, standards, standardsâ&#x20AC;? Document 2 â&#x20AC;&#x201C; Evidence

20. and 21. ISO14000 and 9000 Mission and scope “Both "ISO 9000" and "ISO 14000" are actually families of standards which are referred to under these generic titles for convenience. Both families consist of standards and guidelines relating to management systems, and related supporting standards on terminology and specific tools, such as auditing (the process of checking that the management system conforms to the standard).” 20. ISO9000 Mission and scope “ISO 9000 is primarily concerned with "quality management". Like "beauty", everyone may have his or her idea of what "quality" is. In plain language, the standardized definition of "quality" in ISO 9000 refers to all those features of a product (or service) which are required by the customer. "Quality management" means what the organisation does to ensure that its products conform to the customer's requirements.” Stakeholder focus Specifically refers to process for customers, employees and suppliers Best practice N/e What do I need to look at? AREAS - NA INDICATORS - NA How do I need to look at it? AREAS - Customer focus - Leadership - Involvement of people - Process approach - System approach to management - Continual improvement - Factual approach to decision making - Mutually beneficial supplier relationships

Article 13 “Standards, standards, standards” Document 2 – Evidence

21. ISO14000 Mission and Scope “ISO 14000 is primarily concerned with "environmental management". In plain language, this means what the organization does to minimize harmful effects on the environment caused by its activities.” Stakeholder focus Not explicitly Best practice N/e What do I need to look at? AREAS - NA INDICATORS - NA How do I need to look at it? AREAS - Organisational level - Products and services INDICATORS - Organisational level o Implementing Environmental Management Systems (EMS) o Conducting environmental audits and other related investigations o Evaluating environmental performance - Products and services o Using environmental declarations and claims o Conducting Life Cycle Assessment (LCA) o Addressing environmental aspects in products and product standards Source/Organisation International Organisation for Standardisation, www.iso.org

Article 13 “Standards, standards, standards” Document 2 – Evidence

22. ETI Base Code Mission and scope “The ETI is an alliance of companies, non-governmental organisations (NGOs), and trade union organisations committed to working together to identify and promote ethical trade good practice in the implementation of a code of conduct for good labour standards, including the monitoring and independent verification of the observance of ethics code provisions, as standards for ethical sourcing.” Stakeholder focus Not explicitly, but focuses on labour standards so employees are suppliers are covered Best practice Member companies, NGOs and trade unions are listed on the website What do I need to look at? AREAS - Employment is freely chosen - Freedom of association and the right to collective bargaining are respected - Working conditions are safe and hygienic - Child labour shall not be used - Living wages are paid - Working hours are not excessive - No discrimination is practised - Regular employment is provided - No harsh or inhumane treatment is allowed INDICATORS - Employment is freely chosen o No forced labour o Workers not required to lodge deposits or identity papers - Freedom of association and the right to collective bargaining are respected o Trade unions and collective bargaining o Facilitate parallel means where law restricts these rights o Non-discrimination of employee representatives - Working conditions are safe and hygienic o Planning for accidents and emergencies o Safe and hygienic, or healthy, working environment o Accountable senior management responsible o Clean and safe sleeping arrangements o Clean bathrooms, water and sanitary food storage o Regular, recorded health and safety training for all personnel - Child labour shall not be used o No child labour o Process for remediation of children found engaged in child labour o No exposure of children to hazardous, unsafe, unhealthy situations or working at night o Abolishing child labour and forced labour - Living wages are paid o Meet legal minimum standards and basic needs plus discretionary income o No deductions for disciplinary purposes o Remuneration detailed clearly and regularly o Fulfil full labour and social security obligations towards personnel - Working hours are not excessive o Compliance with applicable law and industry standard o Not over 48 hours a week - No discrimination is practised o No discrimination in hiring, promotion, training and termination of employment

Article 13 “Standards, standards, standards” Document 2 – Evidence

Regular employment is provided o Work performed must be on the basis of recognised employment relationship established through national law and practice o Obligations to employees under labour or social security laws and regulations should apply to labour-only contracting, sub- contracting, or home-working arrangements, apprenticeship schemes fixed-term contracts of employment. No harsh or inhumane treatment is allowed o No physical abuse, discipline, sexual harassment, intimidation

How do I need to look at it? AREAS - NA Source/Organisation The Ethical Trading Initiative, http://www.ethicaltrade.org/

Article 13 “Standards, standards, standards” Document 2 – Evidence

23. Combined Code Mission and scope Designed as a set of principles of good governance and code of best practice that embraces Cadbury, Greenbury and the committee’s own work. Stakeholder focus No evidence Best practice N/e What do I need to look at? AREAS - Directors - Directors’ remuneration - Relations with shareholders - Accountability and audit - Institutional investors INDICATORS - Directors o Effective board to lead and control company o Chairman and CEO with clear balance of power and responsibility o Board balance between executive and non-executive director o Timely, appropriate supply of information to board o Formal and transparent process for appointment of new directors o Regular re-election of all directors - Directors’ remuneration o Appropriate remuneration to directors, link rewards with performance o Transparent and formal procedure for developing policy on director's remuneration - Relations with shareholders o Company should enter into dialogue with institutional shareholders based on mutual understanding of objectives o Board should communicate with private investors and make constructive use of AGM - Accountability and audit o System of internal control o Formal, transparent arrangements for audit committee and auditors - Institutional investors o Institutional shareholders have a responsibility to make considered use of their vote o Institutional shareholders should be ready to enter into dialogue with companies How do I need to look at it? AREAS - NA Source/Organisation The Combined Code, May 2000, derived by the Committee on Corporate Governance from the Committee’s Final Report and from the Cadbury and Greenbury Reports

Article 13 “Standards, standards, standards” Document 2 – Evidence

24. Core Bill Mission and scope “A Bill to make provision for certain companies to produce and publish reports on environmental, social, economic and financial matters; to consult on proposed operations of the company; to specify certain duties and liabilities of directors; to establish a regulatory body; to provide for remedies for aggrieved persons; and for related purposes.” Stakeholder focus Specific mention under ‘Consultation’ Best practice N/e What do I need to look at? AREAS - Duty to prepare and publish reports - Consultation - Provision of information - Duty of companies re subsidiaries, mergers - Environmental, social, economic and financial duties of directors - Liabilities of directors INDICATORS -

Duty to prepare and publish reports o Duty to prepare/publish reports annually o Report should include information on significant financial, social, environmental, economic impacts of its operations in past year o Report should include financial, social, environmental, economic impact assessment of any proposed activity o Report should include employment policies and practices o Report should include information on taxes, payments, benefits, donations, contributions to political party o Report should include director's duties o Report should be made available to stakeholders (shareholders/investors, employees, communities, individuals), any regulatory body, any person with interest in report Consultation o Prior to decision on major project, company should consult and respond to opinions of stakeholders affected by project o As part of consultation, company shall produce environmental, social, economic, financial impact assessment. Provision of information o Copy of report to be sent to Financial Services Authority and London Stock Exchange o Compile a list of background papers to any report or assessment Duty of companies re subsidiaries, mergers o Any subsidiary of company must comply with provisions of bill Environmental, social, economic and financial duties of directors o Duty of directors to consider/minimise environmental, social, economic and financial impacts of operations o Directors should disclose any relevant qualifications/training in these matters o Duty of directors to consider interests of stakeholders o Duty of directors to prepare report identifying risks to company from environmental, economic and social impacts and how these will be managed Liabilities of directors o Directors liable for significant adverse environmental, social, economic,

Article 13 “Standards, standards, standards” Document 2 – Evidence

financial impact due to negligence or wilful misconduct Corporate Responsibility Board o Set up within one year of passing the Act, with duty to issue guidelines o Board will have powers to issue directions to companies if Act is being breached o Board will have powers to investigate matters of concern and the right to summon evidence and information to aid investigation o Board will carry out specific number of random audits of companies o Board members will be appointed who are stakeholders of companies; those that have experience in environmental, social and economic impact o Board will publish annual report

How do I need to look at it? AREAS - NA Source/Organisation FINAL DRAFT Corporate Social Responsibility Bill

Article 13 “Standards, standards, standards” Document 2 – Evidence

25. Company Law Review – July 2002 (UK government) Mission and scope Developing a simple, modern, efficient and cost effective framework for carrying out business activity in Britain. Stakeholder focus Businesses, with special mention of small companies. Best practice N/a What do I need to look at? AREAS - Decisions o No requirement for companies to have AGM unless required by members o Rules on written resolutions easier to facilitate decision-making o Increase transparency o Company constitutions will be single documents with simpler, clearer models for private and public companies o AGMs held six months within financial year-end for public companies and ten months for private companies o Shareholders will be able to require a scrutiny of a poll o Proxies will have extended rights - Directors o Primary role of government should be to promote the success of the company for the benefit of its shareholders o Directors’ general duties to the company should be codified, broadly as proposed by the Review o Proposed guidance for new directors on what these duties mean - Reporting and auditing o Company reporting should provide accurate, accessible information at reasonable cost o Replace current directors’ report o Small companies only require short, simple supplementary statement o Definition of small company will now be in line with EU definition for accounting purposes (£4.8m turnover, £2.4m balance sheet total, 50 employees) o Abolish option for small companies to file abbreviated accounts at Companies House o Reduce time allowed for filing accounts to seven months for private companies and six months for public companies o Very largest companies will have to provide an Operating and Financial Review. Quoted companies will be required to prepare a directors’ remuneration report o Quoted companies will also be required to publish their accounts on their website, within four months of their year-end. INDICATORS - N/a How do I need to look at it? AREAS - N/a Source/Organisation UK Government (DTI)

Article 13 “Standards, standards, standards” Document 2 – Evidence

26. The European Foundation Quality Model (EFQM) Excellence Model Mission and scope To stimulate and assist organisations throughout Europe to participate in improvement activities leading ultimately to excellence in customer satisfaction, employee satisfaction, impact on society and business results; and To support the managers of European organisations in accelerating the process of making Total Quality Management a decisive factor for achieving global competitive advantage.

Stakeholder focus Stresses the need for “balancing and satisfying the needs of all relevant stakeholders (this includes the people employed, customers, suppliers and society in general as well as those with financial interests in the organisation)” Best practice Winners of European Quality Awards (see www.efqm.org for past winners) What do I need to look at? AREAS - Customer focus - Leadership and constancy of purpose - Management by processes and facts - People development and involvement - Continuous learning, innovation and improvement - Partnership development - Public responsibility INDICATORS - Leadership o Leaders develop mission, vision and values and are role models o Leaders personally involved in ensuring the organisation's management systems is developed, implemented and continuously improved o Leaders involved with customers, partners and representatives of society - People o People resources are planned, managed and improved o People's knowledge and competencies are identified, developed and sustained o People are involved and empowered o People are the organisation have a dialogue o People are rewarded, recognised and cared for - Partnership and resources o External partnerships are managed o Finances are managed o Buildings, equipment and materials are managed o Technology is managed o Information and knowledge are managed How do I need to look at it? AREAS - Policy and strategy - Processes INDICATORS - Policy and strategy o Policy and strategy are based on the present and future needs of stakeholders o Policy and strategy based on information from performance measurement, research learning and creativity related activities

Article 13 “Standards, standards, standards” Document 2 – Evidence

o Policy and strategy are developed, reviewed and updated o Policy and strategy are deployed through framework of key processes o Policy and strategy are communicated and implemented Processes o Processes are systematically designed and managed o Processes are improved, as needed, using innovation in order to fully satisfy and generate increasing value for customers and other stakeholders o Products and Services are designed and developed based on customer needs and expectations o Products and Services are produced, delivered and serviced o Customer relationships are managed and enhanced

Source/Organisation EFQM (a not-for-profit membership foundation) established in 1988 by the Presidents of 14 major European companies (Bosch, BT, Bull, Ciba-Geigy, Dassault, Electrolux, Fiat, KLM, Nestlé, Olivetti, Philips, Renault, Sulzer, Volkswagen) with the endorsement of the European Commission.

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Article 13 “Standards, standards, standards” Document 2 – Evidence