CSR Supplier Guidelines
20 November 2014 Date
Introduction
Nordea has a history of actively engaging with stakeholders to identify opportunities for creating
value for customers, shareholders, employees, other stakeholders and society at large. Nordea works
to identify, prevent and mitigate possible adverse impacts that its operations could have on its
surroundings, including people, the environment and society in general.
Nordea has endorsed the UN Global Compact1 and its principles regarding
• Human Rights
• Labour Rights
• Environment
• Anti-corruption.
These principles recognise the common objective of building a sustainable and inclusive economy.
As a responsible and trustworthy financial institution, Nordea aims to build long-term relationships
with its suppliers. While Nordea respects that its suppliers are independent entities, Nordea expects
all its suppliers adhere to the main principles listed above and respect the national sovereignty of host
governments and local social and cultural conditions.
Additional sector-specific environmental requirements may be included as specified in the sourcing
process2.
While working to add value, Nordea focuses on managing its impacts directly through its operations
and indirectly by way of its procurement process, since the entire supply chain contributes to
Nordea’s (total) (CSR) footprint. One way to maintain focus on impacts is to define the common
framework for cooperation, described in this document, with regard to the four areas listed above.
This sets out a common framework to identify opportunities and manage risks. Nordea also wishes to
promote and encourage its suppliers to work for continuous improvement in their own supply chains.
The framework will promote responsible practices that protect and enhance reputation, reduce costs
and risks for Nordea, its customers and suppliers, thus enhancing a financially sound business.
Nordea’s Guidelines
Nordea expects all its suppliers to adhere to the common set of principles of the UN Global Compact.
However Nordea understands that the way of implementing these principles may vary depending on
a company’s size, geographical location and field of business. It is expected that large suppliers have
internal policies and management systems in place, whereas a lighter implementation level is
understandable for small companies. The Guidelines are formulated to reflect the expectations set for
large suppliers.
1
Nordea endorses the following international commitments for sustainability and responsibility: the Universal Declaration of Human
Rights, ILO Conventions, UN Global Compact, OECD MNE guidelines, UN Environmental Programme Finance Initiative, UN
Principles for Responsible Investment, and the Equator Principles.
2
Nordea’s sourcing process – see www.nordea.com for further information
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The objective of Nordea’s CSR Supplier Guidelines is to encourage and assist suppliers in adhering
to Nordea’s principles for identifying, assessing and managing sustainability opportunities and risks.
Overall requirements and encouragements
A prerequisite for doing business with Nordea is that suppliers must comply with applicable laws,
rules and regulations and collective agreements with regard to Human Rights, Labour Rights, the
environment and anti-corruption.
Suppliers are required to ensure they understand the principles of the UN Global Compact and the
common set of obligations and requirements outlined in this document, and ensure on-going
compliance therewith. The supplier must exercise duty of care to ensure compliance.
Nordea encourages its suppliers to recognise and respect the Universal Declaration of Human Rights,
the ILO Declaration on Fundamental Principles and Rights at Work, the Rio Declaration on
Environment and Development and the United Nations Convention Against Corruption.
Nordea encourages its suppliers to actively manage their own supply chain. Suppliers are encouraged
to have a supplier code of conduct or similar which reflects the requirements and principles of the
UN Global Compact, and have procedures in place to evaluate and monitor their suppliers. Nordea
encourages its suppliers to ensure visible and continuous improvements.
Management Systems
All suppliers, in collaboration with their stakeholders, are required to integrate applicable
environmental, social and governance issues into their business operations. Suppliers must establish
environmental, social and governance management systems that reflect the nature and scope of their
risks and opportunities.
Nordea recognises and welcomes that its basic requirements as described in this document and the
UN Global Compact principles can be integrated into business operations in different ways – there is
no ‘one size fits all’ approach. Experience shows that companies begin engagement with the
principles of the UN Global Compact at very different stages of development.
Nordea considers the UN Global Compact Management Model as a best practice for translating the
UN Global Compact principles into actions.
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The UN Global Compact Management Model is a dynamic management framework that consists of
six elements to help drive continuous improvement.
We have provided an overview of each element of the management model below and draw reference
to the UN Global Compact website for further guidance3.
Leadership commitment
to mainstream the Global
Compact principles into
strategies and operations
and to take action in
support of broader UN
goals, in a transparent
way
During this step, company leadership publicly signals
its commitment to stakeholders. Specifically,
leadership commits to supporting the Global Compact
and making the ten principles part of the strategy,
culture, and day-to-day operations of the company,
with oversight provided by transparent governance
structures.
ASSESS
Assess risks,
opportunities and
impacts across Global
Compact issue areas
Equipped with a commitment to the Global Compact
and in support of UN goals, the company assesses its
risks and opportunities - in financial and extrafinancial terms - as well as the impact of its operations
and activities on the issue areas, on an on-going basis
in order to develop and refine its goals, strategies, and
policies.
DEFINE
Define goals, strategies,
and policies
Based on its assessment of risks, opportunities, and
impacts, the company develops and refines goals and
metrics specific to its operating context, and creates a
roadmap to carry out its program.
COMMIT
3
http://www.unglobalcompact.org/docs/news_events/9.1_news_archives/2010_06_17/UN_Global_Compact_Management_Model.pdf
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IMPLEMENT
Implement strategies and
policies through the
company and across the
company’s value chain
The company establishes and ensures on-going
adjustments to core processes, engages and educates
employees, builds capacity and resources, and works
with supply chain partners to address and implement
its strategy.
MEASURE
Measure and monitor
impacts and progress
toward goals
The organisation adjusts its performance management
systems to capture, analyze, and monitor the
performance metrics established in the Assess and
Define steps. Progress is monitored against goals and
adjustments are made to improve performance.
Communicate progress
and strategies and engage
COMMUNICATE with stakeholders for
continuous improvement
During this step, the company communicates its
progress and strategies for implementing its
commitment by developing a Communication on
Progress, and engages with stakeholders to identify
ways to improve performance continuously.
A common framework for continuous improvement
To assist suppliers in translating the principles into actions, Nordea offers the following guidance on
what to do to make principles operational and turn them into tangible actions, processes and
outcomes that specify goals for certain key parts of the management model’s elements.
Local laws and regulations must always be adhered to as a minimum. The principles described below
are to be considered further protective measures.
The elaborations below are provided by Nordea.
UN Global Compact Principles 1 and 2: Human Rights4
The supplier should:
• Identify and assess Human Rights risks, impacts as well as incidents of Human Rights abuses
as a minimum by regular and on-going stakeholder dialogue.
Further explanation:
For some companies the range of stakeholders may be limited to its handful
of employees while for others it may cover society at large, depending on
the nature and scope of the company’s activities. Similarly, the stakeholder
dialogue may range from an informal process to a formal one, which may
even be undertaken by local government.
4
Universal Declaration of Human Rights, December 1948, 217 A (III)
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•
Provide access to remedy by establishing a grievance mechanism appropriate to the scale and
scope of the Human Rights risks and impacts.
Further explanation:
The objective of the grievance mechanism is to empower stakeholders that
are deprived of access to participate in the debate leading to final decisionmaking. This includes the possibility of and a forum for raising concerns or
filing a complaint and getting a fair, just and reasonable resolution. In some
cases there is a limited need for a grievance mechanism while in other cases
the need may be urgent, where impacts are significant and access to
compensation is limited. For example, the mechanism may in some
countries be institutionalised in the form of industrial tribunals, government
or similar arbitration or court processes.
•
Without hesitation take steps to remedy any Human Rights abuses.
Further explanation:
Upon becoming aware of any Human Rights abuses, the supplier should
take steps to address these, take action and compensate people who may
have suffered abuse.
UN Global Compact Principles 3, 4, 5 and 6: Labour Rights
Freedom of Association and Collective Bargaining
The supplier should:
• Respect the right of workers to associate freely, form and join workers’ organisations of their
own choosing, seek representation, and bargain collectively, operating in accordance with
applicable laws and regulations5.
Further explanation:
Companies may seek to establish a sound worker-management dialogue by
providing the right forum for dialogue and negotiation and by supporting
ways in which workers may associate by, for example, providing access to
facilities, resources or other types of general support.
•
5
Protect against acts of interference with the establishment, functioning, or administration of
workers’ organisations.
ILO Convention 87 on Freedom of Association and Protection of the Right to Organize, ILO Convention 98 on the Right to Organise
and Collective Bargaining
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Further explanation:
The Company should not discourage workers from electing worker
representatives, forming or joining workers’ organisations of their
choosing, or from bargaining collectively. The Company will not
discriminate or retaliate against workers who (seek to) participate in such
organisations and collective bargaining. The company should engage with
workers’ representatives and workers’ organisations, and provide them with
information needed for meaningful negotiation in a timely manner.
Workers’ organisations are expected to fairly represent the workers in the
workforce.
Forced labour
The supplier should:
• Not employ labour (any work or service) not voluntarily performed, or which is enforced
through any kind of penalties6. This covers any kind of involuntary or compulsory labour.
Further explanation:
Forced labour also includes requirements of excessive monetary deposits,
excessive limitations on freedom of movement, excessive notice periods,
substantial or inappropriate fines, and loss or delay of wages that prevent
workers from voluntarily ending employment within their legal rights.
Migrant workers are most vulnerable to these types of arrangements.
•
Not employ trafficked persons.
Further explanation:
Trafficking in persons is defined as the recruitment, transportation, transfer
or receipt of persons, by means of:
• the threat or use of force or other forms of coercion
• abduction
• fraud
• deception
• abuse of power
• abuse of a vulnerable individual.
This also includes giving or receiving payments or benefits to achieve the
consent of a person having control over another person, for the purpose of
exploitation.
Women and children are particularly vulnerable to trafficking practices.
Child Labour
6
ILO Convention 29 on Forced Labor, ILO Convention 105 on the Abolition of Forced Labor
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The supplier should:
• Not employ children in any manner that is economically exploitative, or is likely to be
hazardous or to interfere with the child’s education, or to be harmful to the child’s health or
physical, mental, moral, or social development. Neither can they negatively influence the
thoughts nor the beliefs of the child.
Further explanation:
Hazardous work activities include work:
• with exposure to physical, psychological, or sexual abuse;
• underground, underwater, working at heights, or in confined spaces;
• with dangerous machinery, equipment, or tools, or involving handling of
heavy loads;
• in unhealthy environments exposing the child worker to hazardous
substances, agents, processes, temperatures, noise, or vibration
damaging to health; or
• under difficult conditions such as long hours, late night, or confinement
by employer.
•
The minimum age for employment or work shall be 15 years of age, the minimum age for
employment in that country, or the age for completing compulsory education in that country,
whichever is higher. This does not prohibit participation in legitimate workplace
apprenticeship programs7.
Further explanation:
Certain types of work performed by children may be acceptable, but only
when carried out in a manner that is both legal and safe. Most countries
impose legal restrictions on the use of child labour, although terms vary. In
countries where applicable laws do not specify a minimum age, children
aged below 15 (14 in some less-developed countries) should not perform
work. Where applicable laws diverge from this specified age standard, the
higher standard should apply.
Equal Rights and Non-Discrimination
The supplier should:
• Ensure no discrimination against any worker in hiring and employment practices, based on:
o race
o colour
o age
o gender
7
ILO Convention 138 on Minimum Age (of Employment), ILO Convention 182 on the Worst Forms of Child Labor, UN Convention
on the Rights of the Child, Article 32.1
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o
o
o
o
o
o
o
o
sexual orientation
ethnicity
disability
religion
political affiliation
union membership
national origin
marital status.
The above is applicable for employment applications, promotions, rewards, access to training,
job assignments, wages, benefits, discipline and termination8.
Further explanation:
Discrimination in employment is defined as any distinction, exclusion, or
preference with respect to recruitment, hiring, firing, working conditions, or
terms of employment made on the basis of personal characteristics
unrelated to inherent job requirements.
Inherent job requirements refer to genuine occupational qualifications that
are necessary to perform the job in question. For example, requiring that a
worker possess strength sufficient for lifting that is a frequent and essential
part of a job would be considered an acceptable occupational qualification.
•
Ensure workers or potential workers are not subject to pregnancy- or other medical tests with
the purpose to discriminate. Such tests can only be used where required by applicable laws or
regulations or prudent for workplace safety.
Working conditions
The supplier should:
• Continuously improve workers’ health and safety of the work environment. Address
significant safety issues through procedures and mitigation measures to prevent dangerous
situations in both own production and within the primary supply chain.
Further explanation:
The company should address areas that include the
• identification of potential hazards to workers, particularly those that may
be life-threatening;
• provision of preventive and protective measures, including modification,
substitution, or elimination of hazardous conditions or substances;
• training of workers;
8
ILO Convention 100 on Equal Remuneration, ILO Convention 111 on Discrimination (Employment and Occupation), UN
Convention on the Protection of the Rights of all Migrant Workers and Members of their Families
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• documentation and reporting of occupational accidents, diseases, and
incidents; and
• emergency prevention, preparedness, and response arrangements.
•
Restrict working hours to a maximum of 60 hours during a week, including overtime. Provide
workers with at least one day off every seven days.
•
Provide employees with living wages and working conditions. This includes sufficient rest
time, parental leave and holidays.
Further explanation:
Reasonable working conditions and terms of employment could be assessed
by reference to:
• conditions established for work of the same character in the trade or
industry concerned in the area/region where the work is carried out
• collective agreement or other recognised negotiation between other
organisations of employers and workers’ representatives in the trade or
industry concerned;
• arbitration award; or
• conditions established by national law.
•
Convey all employment conditions clearly to employees.
Further explanation:
Working conditions and terms of employment examples are wages and
benefits; wage deductions; hours of work; overtime arrangements and
overtime compensation; breaks; rest days; and leave for illness, maternity,
vacation or holiday.
The supplier should provide workers with documented information
regarding their rights under national labour and employment law and any
applicable collective agreements. This includes their rights related to hours
of work, wages, overtime, compensation, and benefits. Such documentation
should be provided at the beginning of the work relationship and in the case
of any material changes occurring.
All the above documentation must be clear and comprehensible. Verbal
communication may be appropriate for simple short-term jobs or as a
supplement in the case of worker illiteracy.
•
Treat employees with respect. Employees should under no circumstances be subject to
violence, threats, coercion, verbal abuse or sexual harassment.
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UN Global Compact Principles 7, 8 and 9: Environment
The supplier should:
• Improve environmental performance by identifying, assessing and managing environmental
risks and impacts. This has to be done to anticipate such environmental risk and impact and
take suitable actions to avoid and/or minimize the consequences. Subsequently the supplier
must take responsibility and compensate for remaining impacts. Adopt a mitigation hierarchy
to enable a continuous improvement in performance.
Further explanation:
The supplier should take into account the potential impact of its activities on
surroundings and seek to avoid or minimise these impacts in the context of
the nature and significance of pollutants emitted. For small- and mediumsized projects with limited potential emissions, this may be achieved through
compliance with emissions and effluent standards and the application of
other pollution prevention and control approaches.
•
By environmental risks and impacts we imply: use of resources such as water, energy and
other material inputs; pollution prevention and reduction such as emissions to the air, waste
water effluents to soil, surface- or ground water, solid wastes, and hazardous wastes.
Further explanation:
Increased economic activity often generates increased levels of pollution to
air, water, and land, and consumes finite resources in a manner that may
threaten people and the environment at the local, regional, and global
levels. At the same time, more efficient and effective resource use and
pollution prevention, avoidance and mitigation technologies and practices
have become more accessible and achievable.
“Pollution” is used to refer to both hazardous and non-hazardous chemical
pollutants in solid, liquid or gaseous forms. This includes other components
such as:
o pests
o pathogens
o thermal discharge to water
o Greenhouse gases (GHG) emissions
o nuisance odours
o noise
o vibration
o radiation
o electromagnetic energy
o creation of potential visual impacts including light.
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“Pollution prevention” does not mean absolute elimination of emissions,
but the avoidance at source whenever possible, and, if not possible, then
subsequent minimisation of pollution applying technical and commercially
viable solutions.
•
Protect and conserve biodiversity by identifying and assessing impacts and taking steps to
remedy them. Evaluate whether there is risk or impact in significantly converting natural or
critical habitats in own production and in the primary supply chain, and take remedial steps.
Further explanation:
Suppliers should recognise that protecting and conserving biodiversity is
fundamental to maintaining ecosystem services:
• provisioning services, which are the products people obtain from
ecosystems and may include food, freshwater, timber, fibres, medicinal
plants;
• regulating services, which are the benefits people obtain from the
regulation of ecosystem processes and may include surface water
purification, carbon storage and sequestration, climate regulation,
protection from natural hazards;
• cultural services, which are the non-material benefits people obtain from
ecosystems and may include natural areas that are sacred sites and areas
of importance for recreation and aesthetic enjoyment; and
• supportive services, which are the natural processes that maintain the
other services and may include soil formation, nutrient cycling, primary
production.
•
Be able to meet minimum requirements of efficient use of water and limits on emission of
greenhouse gases.
Further explanation:
The potential environmental impacts associated with the emission of
greenhouse gases (GHGs) are considered to be among the most complex to
predict and mitigate due to their global nature. Suppliers are encouraged to
consider their potential contribution to climate change and to minimise
GHG emissions from core business activities to the extent that this is costeffective or possible.
Note on environmental criteria:
Where relevant, sourcing of materials and services will be done according to a set of environmental
criteria. In practice this means that the sourcing process will include indispensable requirements or
specific evaluation parameters related to the environment.
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As examples this could include:
1. Best available technology benchmarks of efficient use of water and limits on emission of
greenhouse gases.
2. Suppliers’ responsibility for their products and/or services in their entire lifecycle, i.e. taking
environmental considerations into the raw materials and production method, improving the
environmental performance in use and offering sustainable ways to dispose of the product.
UN Global Compact Principle 10: Anti-corruption
• Nordea has zero tolerance towards bribery and corruption and requires suppliers and
contractors to act with integrity and without actions involving bribery and/or corruption.