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9

Module No.

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100

Maximum ESG Rating

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High

Implementation Complexity

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BUSINESS ETHICS

Does your manufacturing business have a formal policy on business ethics?

Business conduct policy and principles and regulatory compliance are applicable to employees, independent contractors, advisors and other parties who you work with. The Formal Policy on Conduct Business and compliance helps to take carry out the activities in an ethical, honest manner and in full compliance with legislation and regulations. These principles should be applied to all business decisions in each area of the business (globally).

The list presented here refers to the Guiding Principles on Sustainability of the World Manufacturing Industry.
Extortion: The solicitation of bribes is the act of asking or inciting another to commit a bribe. Becomes in extortion when this request is accompanied threats to the personal integrity or life of the private actors involved.
source : United Nations Global Compact and OECD guidelines for multinational enterprises

Corruption takes multiple forms that differ in terms of its scope, from a minor use of influence to institutionalized bribery. It is defined as the abuse, for private profit, of entrusted faculties.
It can involve not only financial gains, but also other advantages.
source: United Nations Global Compact and Transparency International


Bribery is an offer or receipt of a gift, loan, fee, reward or other advantage to or from a person as an inducement to do something fraudulent, illegal or that involves an abuse of confidence in the performance of the activities of the business
source: United Nations Global Compact and Transparency International


Right to privacy is defined as "No one shall be subjected to arbitrary interference with his or her private life, his or her family, their domicile or correspondence, or attacks on their honor or reputation. Everyone has the right to the protection of the law against such interference or attacks."
source: Universal Declaration of Human Rights


The EU Parliament adopted the General Regulation of statistics protection (GDPR) in April 2016, which came into force in May 2018. It aims to protect all EU citizens from privacy and statistics breaches in a world that is increasingly dependent on statistics. The GDPR is applicable to organizations located both in the EU and outside the EU if they offer goods or services to OR control EU stakeholders. It applies to all undertakings that process and retain personal statistics of residents of the USA, regardless of the location of the business.
source: EU GDPR Portal


Financial duty refers to duty of the business to accurately record, maintain and report on consistent business record such as financial accounts, quality reports, temporary records, expense records and submission of record to customers or regulatory authorities
where applicable. Books and records are expected to be maintained in accordance with applicable law and generally accepted accounting principles.
source: Practical sustainability guide to the global Manufacturing Industry.

Areas are covered by this policy:

Disclosure refers to the business's duty to disclose financial and other information in accordance with applicable regulations and prevailing industry exercises and, where applicable, to disclose information about its workforce, health and safety exercises, environmental, business activities, financial condition and performance.
source: Practical sustainability guide to the global Manufacturing industry.

A conflict of interest occurs when a person or a business (private or public) is in a position to take advantage of their professional or official capacity in some way for their personal or business benefit.
source: OECD

Fair competition and antitrust refers to business' respect for fair business exercises and competition rules, such as avoiding exercises business enterprises that illegally restrict competition; the inappropriate exchange of information of a competitive nature; pricing, fraudulent bidding or improper distribution of markets.
It is a primary duty of large, medium and small business to comply with the rules on the matter of competition. Business must be aware of the risks involved in non-compliance with competition rules and how to develop the compliance policy or strategy that best suits your needs. A compliance policy or strategy allows a business to minimize the risk of participation in infringements of competition laws, as well as the costs that result from anti-competitive behavior.
source: Global Manufacturing Industry Sustainability Practical Guide and the USA Commission


Counterfeits: Business are expected to develop, apply and maintain appropriate methods and processes for their products and services that minimize risk of introduction of false parts and materials in the final products. Business are also expected to establish effective processes to detect fake parts and materials.
and, in such case, isolate the materials and communicate to the OEM customer or security agencies, as appropriate. Finally, business are expected to confirm that sales made to non-OEM customers are compliant.
local legislation and that the products sold will be used legally.
Source: Practical sustainability guide to the global Manufacturing industry.

Intellectual property refers to creations of the mind, such as inventions, literary and artistic works, designs, as well as symbols, names and images used in trade. They are legally protected, for example, by patents, copyrights and trademarks that allow people recognition or a financial benefit of their invention or creation.
Source: World Intellectual Property Organization

Export controls and economic sanctions refers to limitation on the export or re-export of goods, software, services and technology, as well as applicable trade limitation involving certain countries, regions, undertakings or entities and people.
Source: Practical sustainability guide to the global Manufacturing industry.

Training:
Retaliation is defined as a direct or indirect adverse administrative decision or action that threatens to be carried out, recommended or taken against a person who has reported an alleged improper action involving a significant risk or assists in an authorized audit or investigation of a complaint. Business are expected to establish processes (whistleblowing system) to file complaints anonymously and confidentially without danger of retaliation.
Source: WHO and Global Manufacturing Industry Sustainability Practical Guide

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