Westpack CSR Report 2014
Contents Introduction ..................................................................................................................................4 Scope of Westpack’s CSR Efforts ...............................................................................................5 Focus areas ...................................................................................................................................7 Partnership Agreement with Holstebro Municipality ...........................................................7 Sustainability .................................................................................................................................7 Trainee Programs ..........................................................................................................................8 Energy Saving Initiatives ..........................................................................................................9 CSR Audit Program China ........................................................................................................10 Our objectives ............................................................................................................................10 Status of the program ..............................................................................................................11 Plans and Targets for 2015 ........................................................................................................11
Introduction The purpose of the Westpack CSR annual report is to inform internally and externally about activities throughout the year related to our commitment to social responsibility.
We see our responsibility in a broad perspective. Therefore, we divide our activities into two main areas: People and Environment. When referring to people we mean our employees, our partners’ employees and our customers - both direct customers and their end customers. When referring to the environment, we mean both the general environment and our working environment specifically. In our annual CSR report we describe a number of initiatives that we have taken and plan to take in order to demonstrate our positive efforts in the above areas, People and the Environment. Central to our CSR policy is our Code of Conduct. This code is based on many years of experience in our industry in both Denmark and Asia, our own SA 8000 trained employees, our close cooperation with Bureau Veritas, and last but not least what we call common sense. Westpack is a company operating globally, but our CSR activities are primarily focused on our operation in and around our headquarters in Denmark and our operation in and around our companies in China and related subcontractors. At Westpack we are realists. We do not believe we can influence and change the entire world, however, we recognize our responsibility and contribution, and we strive to find a balance between social responsibility and running a profitable business. One does not exclude the other, but a profitable business is a prerequisite to be able to act decisively in relation to Corporate Social Responsibility. Westpack is not legally obligated to publish a CSR report, but we believe that in doing so we go through a healthy process that encourages us to focus on all the small variables, thereby facilitating not only a more responsible conduct but also a more efficient one. The first section describes the general scope of the CSR efforts in Westpack, both in Denmark and China. The following section of the report describes more specifically selected CSR focus areas in 2014 for Westpack Denmark and China respectively. This part of the report will describe why Westpack has put special focus on this specific area, what the current status is, what our aim with the given focus area is and last but not least; what we plan to do in order to achieve the objectives. Morten Dalsgaard Chief Executive Officer Westpack A/S
Scope of Westpack’s CSR Efforts To give the reader a quick overview we have listed the CSR efforts of Westpack Denmark and China respectively in the table below. The table shows the areas in which Westpack has engaged itself and the actions we have taken for each area. The areas marked in bold are key areas and will be elaborated later in this report.
CSR Efforts at Westpack Denmark People
Environment
Health and Safety Risk Assessment (APV)
Quarterly meetings for APV work group Regular health checks for night shift workers Accident alarm for night shift Mandatory APV report
Partnership agreement with Holstebro Municipality
See more in next section
Freedom to undertake physical activities in work time
Recess fitness exercises for production workers 30 min. per week allocated for exercise for all employees Job rotation when possible in production department
Profit sharing
A share of the profit evenly shared among all employees Another share of the profit is given to social events
Staff and education
Monthly information meetings for all staff Annual process seminar for all staff to ensure inclusion Annual individual employee development meeting Staff is offered further education for professional and/or personal development
Trainee programs
See more in next section
Charity
Support of cancer effected children and their families The Danish Cancer Society
FSC™ certification
See more in next section
EU Timber Regulation
See more in next section
Health and Safety Risk Assessment (APV)
See also above
Energy saving initiatives
See more in next section
Our FSC licence number is FSC™-C112509. The mark of responsible forestry. www.fsc.org.
CSR Efforts at Westpack Denmark People
Environment
CSR auditing program
See more in next section
Development of suppliers
Meetings with all key suppliers to discuss and support CSR development
Cooperation with Bureau Veritas
New cooperation Assistance with auditing of suppliers Professional consulting Counseling of suppliers
SA 8000 Internal Auditor certification
Two Westpack QCs certified as SA8000 Internal Auditor to assist CSR auditz program
Anti-corruption policy
New policy Information to all suppliers hereof
Code of Conduct
Updated code of conduct to incorporate standards of SA8000 Signed by all key suppliers
FSC™ certification
See more in next section
EU Timber Regulation
Due Diligence Agreement with all concerned suppliers
Code of Conduct
Signed by all key suppliers
Our FSC licence number is FSC™-C112509. The mark of responsible forestry. www.fsc.org.
Focus Areas Partnership Agreement with Holstebro Municipality Westpack has been working closely with the local municipality for many years with regard to different projects. Amongst others, is a project related to the inclusion of citizens in the job market with temporary or permanent physical or mental deficiencies in the job market. We do this because it adds value both to Westpack and the community. But above all else, it is the only right way for an individual to get assessed on readiness to retain an ordinary job. We do not have a goal for how many citizens we subsequently employ because we are of the firm belief that we should always employ the best qualified person for the position. All employees at Westpack have thus been employed because they were the right candidates, not just because they have been a part of a municipal assessment process. The fact that we actually have a good number of employees resulting from this process just serves as proof that the project itself is useful and positive for the community at large and for our company. Currently we have 6 fulltime employees originating from this program. In the 2014/15 financial year, we have: • on average had four persons in the assessment program with both mental and physical problems. • permanently employed two fulltime employees through the program. Plans and targets for 2015: • Always have a minimum of two persons in the assessment program.
Sustainability At Westpack we are very focused on sustainable production. It is both from a business point of view but also from a social point of view. An example of our approach to sustainable production is our FSC certification. Social perspective: As Westpack is a supplier of packaging and display solutions in wood and paper, it is natural for us to focus on the sustainability of the raw materials we use. The EU has, as of March 2013, enforced regulation (EU’s Timber Regulation) that requires importers to actively ensure that the imported paper and wood materials do not originate from illegal forestry. Westpack has already since 2012 been taking it a step further by being FSC certified and thereby offering our customer a full chain of custody guarantee of sustainable forestry. This is not a regulatory requirement but merely a question of standpoint - a standpoint, moreover, which we share with
many of our customers. Sustainable forestry is key in running a sustainable business in our industry. Business perspective: • We know there are customers who demand FSC certified solutions - so it makes good business sense to be FSC certified. • 3 years ago we decided to become FSC certified in both China and Denmark. We have been certified since August, 2012. • We have been audited every year subsequently - without remarks. • Westpack was a sponsor of FSC International Conference held in Copenhagen 2013. • We have coupled our FSC program closely with the EU’s Timber Regulation (EUTR). In the 2014/15 financial year, we have: • made our first box sample from corn-plastic which is a 100% biodegradable material made from corn starch. We intend to continue experimenting and developing further on alternatives to oil based plastics. • made our first 100% own-produced FSC boxes, marketed since spring 2015. • been FSC-audited by NEPcon - without remarks. • offered all relevant employees an internal FSC course. • conducted regular controls of our FSC certified suppliers. • conducted regular controls of our wood and paper suppliers to ensure compliance with the EUTR Directive. Plans and targets for 2015: • Renewed FSC-audit for 2015 without remarks. • Maintain the number of FSC certified suppliers. • Consistently have a minimum of one assortment of boxes that are produced in-house and FSC labeled. This goal shall be part of our Product Development Process.
Trainee Programs At Westpack we consider it an important responsibility to have trainees each year. This is important from a community point of view, but also from a business point of view. Westpack has always had a considerable number of trainees. The last three years Westpack had a ratio of 7%, 8% and 4% of the workforce respectively. Social perspective: The government sets targets for the number young people who complete a trainee
program. Therefore Westpack takes our share of the responsibility in achieving this target by hiring trainees every year. • Westpack Headquarter is situated in the city of Holstebro, which is a very ambitious city in the area of education. It is therefore natural for Westpack to support this ambition and, completely in line with the company’s education policies, to provide trainee positions for the youth in our local community. Business perspective: • We believe that the trainees we train, educate and coach are capable and competent employees that we will use in the future. Therefore, it is also an objective that so many of our students as possible are hired after completing the trainee program. • We always offer our trainees to complete more school modules than the compulsory. Unfortunately, this means that they are away for a longer period of time from the company, but we do this because we know that they will return more confident and with even more skills, skills that Westpack can put to good use hereon forward. So we have a long-term perspective for every trainee we hire. In the financial year of 2015, we have: • 2.8 trainees out of a total workforce of 61 full-time employees. Equivalent to 5%. • 8 former Westpack trainees are part of the permanent workforce. Plans and targets for 2015: • Our goal is that a minimum of 5% of the total workforce at Westpack in Denmark are hired in a trainee program, counting both ordinary office trainees but also adult trainees and production trainees.
Energy Saving Initiatives At Westpack we strive daily to minimize our energy consumption. Again, we do it out of two perspectives: social responsibility and good business practice. In other words, it makes sense financially and at the same time we are conscious of the signal we, as a leading company in the local community, are sending. Social perspective: • As it is well known, the world is going through climate changes that are at least in part caused by increased CO2 emissions. Many local and international initiatives are set in place in order to minimize the negative effects that businesses have on the environment. However, we as a responsible company are prepared to take initiatives of our own in order to take part in minimizing energy consumption. Business perspective: • All employees know that they are part of a socially conscious business. This can also be illustrated by our focus on energy-efficient solutions.
• The plastic production at Westpack is relatively energy intensive, which is why this particular department is at the center of our focus. In 2014 financial year, we have: • installed LED lighting throughout the production hall. We continue to test over the next year and if we are satisfied with the quality we will replace the lighting in other halls. Energy Savings: approx. 25 MW on the current activity which is about 1,025 MW per year (expected in 2015). • initiated a project in which we measure the energy consumption of our various plastic injection molding machines. This analysis will form the basis for a phaseout from energy inefficient machines to energy efficient ones. Plans and targets for 2015: • Over the last few years the energy consumption has gone up along with our production increase, from 941 MW in 2012, to 979 MW in 2013 and 1,076 MW in 2014. Despite this volume increase it is our goal to reduce our current energy consumption by 10% over the coming two years from 1,025 MW per year to 923 MW per year.
CSR Audit Program China The Chinese marketplace is in many ways a challenging one to operate in, the field of CSR is no exception. Therefore, it is only natural for Westpack to go to great lengths to ensure a sustainable impact on the Chinese community. As stated in our Code of Conduct, workers’ rights and respect for the individual is central to our CSR program.
Our Objectives In our program we seek to ensure that the suppliers that produce Westpack’s goods are conducting their business in a proper way. As stated in Westpack’s Code of Conduct we lean heavily on the principles of SA8000 when auditing and counseling our suppliers. To ensure expertise and to avoid potential conflicts of interests Westpack has entered into a cooperation with Bureau Veritas (B.V.) which assists Westpack in the CSR program and counsels in matters relating to CSR. When auditing B.V. is responsible for issues pertaining to Child Labor, Forced and Compensatory Labor, Freedom of Association, Discrimination, Disciplinary Practices, Working hours and Remuneration. This way no supplier can claim conflict of interest as B.V. will be handling documents of a sensitive and confidential nature. The Westpack QC team is responsible for issues relating to Formalities, Health and Safety, Management System and Environment, and counts two certified SA8000 auditors. Initial audits will always be attended by WPCN management together with the WPCN CSR auditor and B.V.
In addition to the audits commissioned by Westpack, a number of our customers commission audits in their own program, which we believe to be an advantage. When looking at the general industry of packaging, Westpack can be seen as a relatively small player, however, we work closely with our customers who have their own CSR programs and in this way we maximize efforts on all levels to conform to social accountability. Therefore, when customer commissioned audits are conducted by a recognized auditing company we will incorporate these audits into our program and follow up on the corrective action points on a par with our own audits. As mentioned in the introduction, Westpack has a realistic approach to CSR, however, it is absolutely imperative that the supplier shows a sincere determination to improve their CSR performance. In other words, the will to improve the performance is just as important as the initial performance level.
Status of the program
In this first year of structured audits we have conducted a total of 11 audits. The 11 audits have been divided among 7 suppliers. 5 audits have been commissioned by Westpack and 6 audits have been customer commissioned. All customer commissioned audits have been conducted by SGS. The 7 suppliers audited are the equivalent to 15% of our active suppliers in China. As audits have been prioritized mainly by volume these 7 suppliers cover 58% of Westpack’s volume.
Westpack A/S & Westpack Ltd. 03 -Feb-15