Continued efforts to improve social conditions
“Alfa Laval respects the human rights of its employees and the communities in which we operate and supply.”
Respect for human rights is fundamental
Alfa Laval’s Social Business Principle is concerned with the way in which our business impacts the lives of people throughout the entire supply chain. With sales in over 100 countries, we encounter many situations in which adherence to our social business principle poses challenging questions.
Risk-based assessment of suppliers
Alfa Laval’s own operations have worked in compliance with our social business principles for many years. Accordingly, the main emphasis for initiatives involving the social business principle is on our immediate suppliers. We assess suppliers to determine the risk of non-compliance based on the inherent risks from the manufacturing process and the risk due to ineffective legal enforcement. Countries with emerging economies naturally have the most difficulty in enforcing all aspects of workplace law.
The risk-assessment process identifies suppliers that will be audited to assess compliance with the business principles. The audit covers health and safety, working conditions (compliance with minimum wage, working time, overtime laws, etc.) and housekeeping standards. Any supplier whose performance is unacceptable is advised of the aspects that need to be improved. Targets and timescales are agreed. A total of over 150 social audits of suppliers in India, China, Mexico and Eastern Europe were conducted in 2008.
Social inspections of suppliers produce improvements in India
Alfa Laval in India has been inspecting suppliers for compliance with the Social Business Principle since 2005. Each supplier is scored on over 50 different aspects of health, safety, working conditions and working environment. The maximum score possible is 250 points.
Alfa Laval has approximately 350 suppliers in India. In 2007, 64 suppliers were inspected, some of them several times. Of these, 35 were found to be below the minimum requirement with an average score of 51 percent. One year later, 34 of the 35 suppliers had improved to above the minimum standard with an average score of 75 percent. In 2008, the program was extended to cover 126 suppliers.
The most obvious improvement in all these suppliers is increased awareness and attention to health and safety precautions. Many more companies now provide their employees with appropriate personal protective equipment, such as ear protection, safety shoes or safety glasses. Even more importantly, understanding of the importance of good health and safety training has improved.
Social
Respect for human rights is fundamental
Alfa Laval respects the human rights of our employees and the communities in which we live and supply.
  • Human Rights
    Alfa Laval supports and respects the protection of internationally proclaimed human rights within our sphere of influence.
  • Complicity
    Alfa Laval should make sure it is not complicit in human rights abuses in its course of operations.
  • Freedom of Association
    Alfa Laval should uphold the freedom of association and the effective recognition of the right to collective bargaining.
  • Forced Labour
    Alfa Laval will not use any form of forced or compulsory labour.
  • Child Labour
    Alfa Laval works towards the effective abolition of child labour in the community.
  • Discrimination
    Alfa Laval works to eliminate direct and indirect discrimination in respect of employment and occupation.
PHOTO: SAGAR GOTKHINDIKAR (SAGAR GRAPHICS.)  
Alfa Laval supplier audit – Shree Ganesh Engineering works, Bhosari, India.
Ethical behavior – a base for sustainable success
“Alfa Laval pursues its operations in an honest manner, with integrity and respect for others.”
Alfa Laval’s employment policies include distinct guidelines for ethical behavior, notably in respect of conflicts of interest, political contributions, bribes and corruption.
Application and compliance
It is the responsibility of Alfa Laval Group Management to ensure that the Business Principles are communicated to, understood and observed by all employees. The president of each Alfa Laval company is responsible for implementing these principles through appropriate rules and policies in addition to those necessary for compliance with local legislation. No manager or employee will be criticized for any loss of business resulting from adherence to these principles. Equally, the Alfa Laval Board and Group Management undertake that no employee will suffer as a consequence of bringing to their attention, or that of senior management, a breach or suspected breach of these principles.
Whistle blowing to reveal any breaches of the business principles
Alfa Laval investigates all suspected violations of the company’s Business Principles. Employees are to report suspected violations to the Group’s Human Resources Manager, who coordinates the investigation. Alfa Laval protects all whistle blowers, meaning employees who report suspected breaches.
The Chairman of the Board is contacted if anyone in Group Management is suspected of being involved in or participating in any violation of the Business Principles.
Open dialog creates confidence in financialmarkets
Alfa Laval’s financial accounting and supporting documentation describes and reflects the underlying transactions in a correct manner. No unaccounted or concealed items, funds or other assets are permitted. Alfa Laval’s reporting and internal monitoring are conducted so that external, independent parties can verify operations. All share-price-sensitive information is communicated in line with the company’s policy, stock exchange agreement and applicable legislation.
Transparency
The company’s pledge of open dialog creates confidence. Alfa Laval believes in open communication but is careful not to disclose commercially valuable information.
High ethical standards form the basis for Alfa Laval’s performance
During 2007 and 2008, line managers in sales companies and central organizations were involved in training concerning ethics and business integrity. The training included a risk-assessment process aimed at identifying areas where improvements to local policies, communication or compliance monitoring were needed. These exercises identified improvement opportunities. For example, in 2007, employment policies in several sales companies were revised to include more explicit rules and guidance concerning conflict of interest. During 2008, the focus was on improving training and communication of the company’s policies regarding anti-competitive behavior.
Business integrity
High ethical requirements comprise the basis for Alfa Laval’s performance
  • Legal compliance
    Alfa Laval shall not only meet regulations and requirements in countries in which the company is active but also shall continually stay abreast of developments in international legislation, social conditions and voluntary initiatives and accept these when it is relevant to the company’s operations.
  • Conflicts of interest
    Alfa Laval’s employees shall not get into situations in which their personnel or financial interests conflict with those of the company.
  • Political contributions
    Contributions are not to be made to political parties or committees, or to individual politicians.
  • Bribes and corruption
    Alfa Laval and its employees shall not offer, promise, accept or demand a bribe or other inappropriate benefit to win or retain business; also, suppliers or other business partners shall not demand or expect a bribe or other inappropriate benefit.