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Case study: How Lonza combats corruption

Lonza is one of the world’s leading and most-trusted suppliers to the pharmaceutical, biotech and specialty ingredients markets, with approximately 15,500 full-time employees worldwide. As a global integrated solutions provider, it is Lonza’s policy to conduct all its business in an honest, fair and ethical manner.

This case study is based on the 2018 Sustainability Report by Lonza 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.

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Lonza takes a zero-tolerance approach to bribery and corruption  Tweet This! and is committed to acting professionally, fairly and with integrity at all times, implementing and enforcing effective systems to help prevent bribery and corruption. In order to combat corruption Lonza took action to:
  • monitor and promote compliance
  • implement an Ethics Hotline
  • provide communication and training on anti-corruption policies and procedures

What are the material issues the company has identified?

In its 2018 Sustainability Report Lonza identified a range of material issues, such as economic performance, product quality and reliability, environmental compliance, customer satisfaction, occupational health and safety, socioeconomic compliance. Among these, combatting corruption stands out as a key material issue for Lonza.

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:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

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 Lonza engages with:

Stakeholder Group
Suppliers
Customers
Group Management and Board of Directors
Employee Associations
Employees
Associations and Competitors
Consumers and Patients
Lenders
Shareholders and Investors
Rating agencies and Analysts
Proxy Advisors
Regulators
Government / Authorities
Future Talent
Local Communities
Scientific Community
NGOs
Media / General Public

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics Lonza engaged with its stakeholders – including employees, customers, academia, financial analysts, future talent, media and Lonza management and Board – through a materiality survey, to capture their input on topics to be made transparent and reported upon, actively managed or simply monitored.

What actions were taken by Lonza to combat corruption?

In its 2018 Sustainability Report Lonza reports that it took the following actions for combatting corruption:

  • Monitoring and promoting compliance
  • Lonza has a dedicated Ethics and Compliance team that is charged with monitoring and promoting compliance with anti-bribery and anti-corruption laws. In addition, Lonza is considering engaging in periodic global trend analyses, to identify areas of anti-corruption risk and implement mitigation steps as necessary, as well as implementing a new electronic interface, for third-party due diligence. Accordingly, a survey of Lonza’s sites regarding anti-corruption precautions was initiated in 2018, with results being communicated after analysis.
  • Implementing an Ethics Hotline
  • Lonza’s Ethics Hotline provides a mechanism for employees and others to report potential violations of the Code of Conduct, any Lonza policies or procedures (including those related to anti-corruption), or applicable laws or regulations. Such reports may be made anonymously where allowable by law. Those found responsible for any violations may face disciplinary action, which includes termination of employment. 
  • Providing communication and training on anti-corruption policies and procedures
  • All Lonza employees have access via the company’s intranet site to Lonza’s Anti-Corruption and Anti-Bribery Policy. New hires are trained via an online training module on anti-corruption and anti-bribery, while anti-corruption and anti-bribery is also covered in Lonza’s Code of Conduct, and in the annual Code of Conduct training required of all employees. Suppliers that enter into Lonza’s standard supply agreement agree to adhere to Lonza’s Supplier Code of Conduct, which sets forth commitments to working against corruption and bribery. Lonza’s Supplier Code of Conduct applies to both its suppliers and to any subcontractors or other third parties that a supplier may engage in the performance of their contractual obligations. Currently, suppliers are instructed to implement internal measuring procedures, tools, and indicators required to guarantee adherence to the Lonza Supplier Code of Conduct principles. Suppliers are also encouraged to report any violations by e-mail, or by using Lonza’s Ethics Hotline.

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

 

Disclosure 205-1 Operations assessed for risks related to corruption corresponds to:

  • Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
  • Business theme: Anti-corruption

Disclosure 205-2 Communication and training about anti-corruption policies and procedures corresponds to:

  • Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
  • Business theme: Anti-corruption

 

80% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

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References:

1) This case study is based on published information by Lonza, 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/

Note to Lonza: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.

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