Case study: How IPG promotes ethical business conduct
IPG is a recognised leader in the development, manufacture and sale of a variety of paper and film-based pressure-sensitive and water-activated tapes, polyethylene and specialised polyolefin films, protective packaging, engineered coated products and packaging machinery for industrial and retail use. The Board of Directors and management of IPG believe that the highest standards of corporate governance are essential in the effective management of the company, as well as its ability to build sustainable worth for customers, business partners, employees, investors and communities.
This case study is based on the 2019 Sustainability Report by IPG published on the Global Reporting Initiative Sustainability Disclosure Database that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
Abstract
IPG is committed to maintaining a high standard of corporate governance Tweet This!, and regularly reviews and updates its corporate governance systems considering changing practices, expectations and legal requirements. In order to promote ethical business conduct IPG took action to:
- implement a Code of Conduct
- fight corruption
- combat anti-competitive behaviour
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With this case study you will see:
- Which are the most important impacts (material issues) IPG has identified;
- How IPG proceeded with stakeholder engagement, and
- What actions were taken by IPG to promote ethical business conduct
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What are the material issues the company has identified?
In its 2019 Sustainability Report IPG identified a range of material issues, such as product design and innovation, employee retention, product safety, human rights and employment standards, data security. Among these, promoting ethical business conduct stands out as a key material issue for IPG.
Stakeholder engagement in accordance with the GRI Standards
The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:
Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.
Key stakeholder groups IPG engages with:
To identify and prioritise material topics IPG engaged with its stakeholders through the following channels:
Stakeholder Group | Method of engagement |
Charitable organisations
| · Financial support · Employee volunteering · Donation of time and products |
Communities
| · Open houses · Sponsorship of local events · Participation in local chambers of commerce |
Consumers
| · Product labelling · Social media · Website contact form |
Distribution or retail customers | · Sales processes for product · Supply around the bundle and the market · Marketing support · Training support · End user trials/New product trials · Trade show booth presence · Customer appreciation events at trade shows · Social media |
Employees
| · Newsletters · Quarterly videos · Variety of social media · Employee training · Town halls · Employee engagement activities · Surveys · Union interactions |
Government and regulators | · Regulatory filings · Public reporting · Product labelling |
Industry organisations and other NGOs | · Participation at trade shows and conferences · Membership and leadership positions · Participation at local, regional and national events |
Shareholders and the IPG investor community | · Annual Report and Annual Sustainability report · Annual shareholders meeting · Investor meetings · Road show events · Press releases |
Vendors – other | · Contracts · Routine business communication |
Vendors – raw material suppliers | · Monthly/Quarterly meetings · Annual business reviews · Routine business communication · Senior management meetings · Collaborative R&D training · Joint development · Negotiation |
What actions were taken by IPG to promote ethical business conduct?
In its 2019 Sustainability Report IPG reports that it took the following actions for promoting ethical business conduct:
- Implementing a Code of Conduct
- IPG’s Code of Conduct provides an overview of its commitment to doing business the right way and sets out basic guiding principles that apply to all governance body members, workers, business partners and other stakeholders, regardless of location or nationality. IPG holds periodic information and training sessions for all directors, management personnel and employees to promote compliance with laws and regulations, as well as IPG’s policies and procedures. The Code of Conduct requires compliance with laws, regulations, and IPG’s policies and procedures. These policies and procedures include: Anti-bribery and Foreign Corrupt Practices Act Policy, Insider Trading Policy, Whistleblower Policy, Diversity Statement and a No Harassment Policy. The Code of Conduct also addresses expectations of behavioural norms related to conflicts of interest, confidentiality and fair competition, discrimination and harassment, record-keeping, confidential information and protection, proper use of corporation assets and the responsibility of each employee for maintaining a safe and healthy workplace. Human Resources Managers at each location provide all new employees with either a written or electronic version of the Code of Conduct. Where necessary, a translated version of the Code of Conduct is provided; the Code of Conduct is currently available in four languages. Salaried employees complete an online training module. The Senior Vice President of Human Resources is responsible for efforts to communicate and train all governance body members, workers, business partners and other stakeholders regarding the Code of Conduct. Employees are encouraged to talk to supervisors, managers, human resources, the legal department, or other appropriate personnel about observed illegal or unethical behavior, and when in doubt about the best course of action in a situation. It is the policy of IPG not to allow retaliation for reports of misconduct by others made in good faith by employees. IPG expects employees to cooperate in internal investigations of potential misconduct and maintains a Business Conduct and Ethics Hotline, while its Whistleblower Policy protects those who use it from retaliation for any good faith report.
- Fighting corruption
- Bribes, kickbacks and other illegal payments to or from any individual with whom IPG conducts business are strictly prohibited. All governance body members, workers, business partners and other stakeholders receive communication about anti-corruption via the Code of Conduct which includes basic information and encourages all to review the Anti-Bribery and Foreign Corrupt Practices Act Policy. IPG has completed an assessment of all its operations and has a third party assessing vendor compliance, and reports significant risks and/or breaches to the Audit Committee.
- Combating anti-competitive behaviour
- IPG did not have any legal actions pending or completed during the reporting period related to anti-competitive behaviour and violations. Management and other employees throughout the company received training by an outside legal counsel to educate them on the laws concerning anti-competitive behaviour to ensure compliance with all anti-competitive laws and regulations. IPG’s Code of Conduct further emphasises the importance of compliance with these requirements. Furthermore, IPG has not identified any material non-compliance with laws or regulations in the social and economic areas.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standards addressed in this case are:
1) Disclosure 205-1 Operations assessed for risks related to corruption
2) Disclosure 205-2 Communication and training about anti-corruption policies and procedures
3) Disclosure 206-1 Legal actions for anti-competitive behavior, anti-trust, and monopoly practices
4) Disclosure 419-1 Non-compliance with laws and regulations in the social and economic area
Disclosure 205-1 Operations assessed for risks related to corruption corresponds to:
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.5
Disclosure 205-2 Communication and training about anti-corruption policies and procedures corresponds to:
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.5
Disclosure 206-1 Legal actions for anti-competitive behavior, anti-trust, and monopoly practices corresponds to:
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.3
Disclosure 419-1 Non-compliance with laws and regulations in the social and economic area corresponds to:
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.3
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References:
1) This case study is based on published information by IPG, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:
http://database.globalreporting.org/
2) https://www.globalreporting.org/standards/gri-standards-download-center/
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