H2. Code of conduct and work with anti-corruption

Essity’s target is for all employees to receive regular training in the Code. In 2019, the company launched an updated Code of Conduct including a new training course. A total of 96% of Essity’s employees underwent this mandatory course.

Risk analysis

Essity conducts regular risk assessments and complies with the UN Guiding Principles on Business and Human Rights. Essity’s human rights and corruption risk analysis is based partly on assessments carried out by Transparency International and Sedex. About 34% of Essity’s revenue comes from sales to countries with a relatively high risk of corruption. In the 2019 Sedex assessment, all of Essity’s main facilities received a low to medium risk classification relating to human rights and corruption.

Reported breaches of the Code of Conduct

In 2019, 88 (81; 63) cases of potential breaches of laws or of the Code of Conduct were reported to Essity’s whistleblower system. Among the reported complaints, six related to the suspicion of corruption. All of the six investigations were closed during the year without any corruption being identified. No one was dismissed on suspicion of corruption. Other reported complaints included 65 HR-related incidents and concerned accusations of discrimination and harassment. The remaining 17 cases concerned potential violations of the company’s other policies.

Internal audits conducted of the Code of Conduct

In 2019, internal audits were conducted of the Code of Conduct at facilities in Germany, India, Brazil and France. All parts of the audit of the facility in Germany fulfilled SA8000. The facility in India must improve its efforts regarding dangerous chemicals and other aspects of health and safety. The facility in Brazil must improve its working climate between employees and its management of production waste. The facility in France needs to improve its health and safety and its compliance with local regulations. An action program is in place and has or will be implemented in 2020.

Internal audits conducted of business ethics

In 2019, business ethics audits were conducted in India, the US and Ukraine. The audits found that Essity’s operations in India must improve working conditions for sales personnel and continue to implement Essity’s policies and instructions and to conduct training sessions. Professional Hygiene operations in the US demonstrate consistent effective control and follow-up but require minor improvements in registering conflicts of interest and increase the number of business partners who sign Essity’s Business Partner Code of Conduct. Essity has good control of its business operation in Ukraine, but must improve documentation of participants in training courses concerning the Code of Conduct and carry out a risk management process in relation to anti-corruption. Action plans are in place and have been, or will be, implemented in 2020.

Ongoing anti-trust cases

In early 2020, the Supreme Court in Chile rejected the company’s appeal against the Chilean competition authority’s decision to impose a fine from December 2017.