In 2019, Clariant focused on building strong customer relationships and understanding customers’ needs to gain valuable insights for sustainable value creation. As suppliers are critically important to Clariant’s value creation, the company continuously analyzes spend effectiveness and reduces risk in procurement. In 2019, Clariant received the World Procurement Award for its integrative supplier risks management approach that helps suppliers meet the company’s strict sustainability and risk expectations.

2.2. Ethics and compliance

In 2019, Clariant remained committed to implementing its Strategic Integrity Roadmap. This roadmap, which is structured around the company’s five pillars of leadership engagement, communication and training, risk assessment, standards and controls, and monitoring, lays the foundation for an ethical mindset and responsible behavior in the workforce. By carrying this commitment forward, Clariant’s transformation from a rules- and principles-based organization into a value-based organization continues.

Clariant uses a comprehensive set of key performance indicators to measure effective progress toward the objectives of the roadmap.

2.2.1. Revising the Code of Conduct to embed ethical behavior

As part of the standards and controls pillar of the Strategic Integrity Roadmap, Clariant’s Code of Conduct guides employees through ethical commitments and supports them in reflecting on responsible actions and decisions. In 2019, Clariant revised the Code of Conduct, which applies to everyone working for Clariant. It includes new topics and commitments, a Q&A section, as well as scenarios that demonstrate these commitments in practice and emphasize the speak-up culture by strengthening its commitment to non-retaliation and the manager’s responsibility. The updated Code of Conduct will be published on Clariant’s website and will be rolled out throughout the organization in 2020.

2.2.2. Engaging people for ethics and compliance

To underscore the importance of ethical business practice, in 2019, Clariant continued the rollout of its Leader-led Compliance Sessions to the company’s senior leaders and the commercial organization. These sessions provided a forum to discuss ethical dilemmas that emerge in daily business practice and share lessons learned and best practices. The dilemmas were based on scenarios addressed by the Code of Conduct, such as anti-bribery, antitrust, data privacy, conflict of interest, and discrimination and harassment. As observed in 2018, the Leader-led Compliance Sessions resulted in more requests for guidance from the Ethics & Integrity functions and increased the number of reports received through the Integrity Line by 11.5% compared to the years that preceded the rollout of Leader-led Compliance Sessions.

Clariant continued to conduct its mandatory e-learning and in-person compliance trainings for all employees to prevent violations of the Code of Conduct. In 2019, roughly 6 000 employees received Code of Conduct training; 100% of the Board members and 85% of employees received training on anti-corruption; and approximately 8 200 employees successfully completed the e-learning on antitrust law.

In 2019, Clariant further strengthened communication regarding ethics and compliance, which included regularly publishing articles on the intranet regarding business ethics and sharing results from internal investigations in its ethics journal. Each communication illustrated a real case from Clariant’s businesses and discussed how it was resolved. The articles caught considerable attention from employees, as indicated by above-average click rates.

2.2.3. Taking steps to reduce risk exposure

Since Clariant’s businesses operate in countries with diverging risk profiles, an ongoing risk assessment is conducted to identify gaps in the ethics and compliance framework in different markets. In 2019, Clariant carried out additional compliance risk assessments in two Business Units. After this process revealed gaps, steps were taken to reduce the risk exposure. For example, the Economic Sanction policy will be revised and a provision regarding anti-money laundering will be added to the Anti-Bribery and Anti-Corruption Policy. In addition, employees working in compliance functions were trained on topics such as anti-bribery, data privacy, and general ethics and integrity.

2.2.4. Establishing the Data Privacy Program

In response to the General Data Protection Regulation (GDPR) of the European Union, Clariant implemented a Data Privacy Program in 2018. The program consisted of a policy framework that encompassed a Data Privacy Policy, a general Directive on how to process personal data, standardized operation procedures (SOPs) on the subject of Data Breach and execution of privacy rights, and a basic Data Privacy e-learning course to familiarize all employees with the principles of the data privacy policy. In 2019, Clariant focused on further implementing the framework, offering deep-dive sessions for more exposed functions, and introducing a second module to the Data Privacy E-Learning. Furthermore, Clariant continued its efforts to establish a personal data inventory and record of processing activities aligned with the GDPR requirements.

A Data Privacy Organization was also set up and internally certified after extensive training that covered the main topics for certified Privacy Professionals from the International Association of Privacy Professionals. The certified members of the Data Privacy Organization are responsible for creating awareness and building up the relevant knowledge throughout the company with a Train-the-Trainer approach.

2.2.5. Improving performance of the grievance mechanism

A key instrument to track Clariant’s performance on ethics and compliance is the »Clariant Integrity Line,« which is used to report workplace-related issues and violations against the Code of Conduct. All employees are encouraged to confidentially report non-compliant behavior. In 2019, Clariant improved the Integrity Line by simplifying the process of raising a concern and by enhancing the reporting on multiple indicators. With improved assessments and classifications of allegation types, Clariant is able to gain better insight into potential misconduct and take preventative actions.

2.3. Policy and stakeholder relations

Clariant believes that maintaining an open and trustworthy dialog with all stakeholders and participating in relevant public policy developments are both important aspects of its corporate responsibility.

The engagement of Clariant representatives in trade associations and other platforms supports strategic alignment across the industry, provides an opportunity for exchange on industry perspectives and best practices, and brings forward Clariant’s views and positions on various policy areas.

Clariant is a member of numerous interest groups and trade associations. At the international and regional level, these include, among others, the International Council of Chemical Associations (ICCA) and the European Chemical Industry Council (Cefic). At the national levels, Clariant is part of national business federations and chemical industry associations, such as the Associação Brasileira da Indústria Química (ABIQUIM) in Brazil, the China Petroleum Chemical Industry Federation (CPCIF) in China, the Verband der Chemischen Industrie (VCI) in Germany, and the American Chemistry Council (ACC) in the United States.

Clariant is also active in sectorial associations, such as in the bioeconomy field, and supports scientific and research associations, including SusChem, the European Technology Platform for Sustainable Chemistry.

As a responsible corporate actor that values transparency, Clariant publicly discloses its contributions to trade and business associations. clariant.com/en/Company/Corporate-Governance/Public-Policy-Dialog

The top three contributions Clariant made in 2019 were all for Europe-based associations. Together, they represented more than 50% of Clariant’s total membership costs. These were:

1. Verband der Chemischen Industrie e.V. – VCI, the German national association of chemical producers;
2. Handelskammer beider Basel, the Basel Chamber of Commerce; and
3. Scienceindustries, the Swiss business association for the chemical, pharmaceutical, and biotech industries.

Active engagement in these bodies helps Clariant maintain a continuous stakeholder dialog in strategically important fields. In 2019, Clariant has worked on a number of policy areas related to sustainable chemistry, climate change, circular economy, bioeconomy, and innovation policy frameworks.

2.5. Human rights

Clariant is firmly committed to protecting human rights during all phases of value creation within all Business Units. This obligation applies not only to Clariant’s own business operations, but also to its entire supply chain and contracted workers. As a prerequisite for sound business governance and license-to-operate, Clariant expects its business partners to uphold the same high standards regarding human rights.

Clariant crafted a comprehensive framework of policies, guidelines, and processes to ensure the implementation of its human rights commitments. Clariant performed investigations in areas that were identified as high-risk during the 2016 human rights due diligence review.

In 2019, Clariant decided to join the Responsible Mica Initiative. This cross-industry initiative cultivates collaboration with local governments and NGOs as well as global stakeholders in the mica value chain, which include Clariant suppliers and customers. Clariant will be actively involved in the four action programs of the initiative: Traceability & Specifications, Legal Framework & Advocacy, Communication, and Community Empowerment.

To further advance ethical operations, Clariant developed a global employment policy in 2018 that addresses fair working conditions, discrimination, freedom of association, occupational health and safety, as well as child and forced labor. In 2019, particular emphasis was placed on trainings for employees working in the Human Resources departments in order to ensure global implementation. The policy’s content and objectives were further propagated throughout the organization to ensure comprehensive understanding and acceptance. Clariant also conducted an audit in all major countries to monitor implementation and adherence to the policy. As of 2019, the policy is also part of the onboarding curriculum for new employees. In order to ensure proper comprehension, the policy was translated to local languages and communicated to employees. By embedding the topic in leadership and management meetings and developing a learning and training curriculum, Clariant will further raise awareness.

Finally, via the TfS platform and in cooperation with other companies, Clariant regularly assesses its suppliers in relation to child and forced labor, among other social, governance, and environmental topics.