Corporate Social Responsibility in PSI...Page 1 of 21 Corporate Social Responsibility in PSI 1....

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Corporate Social Responsibility in PSI

1. Introduction

The Dutch government gives high priority to Corporate Social Responsibility (CSR). PSI projects

aim to be frontrunners on CSR in their countries and sectors of operation. CSR-aspects are thus

included in the assessment of PSI-proposals. CSR ensures that social equality and care for the

environment are fully integrated in your operational processes.

If your company submits a PSI proposal you will be obliged to declare that you are

knowledgeable about, agree with and obey the:

1) OECD Guidelines for international Enterprises on CSR, please refer to

http://www.oecdguidelines.nl/guidelines or for a more concise overview http://www.vno-

ncw.nl/Publicaties/Brochures/Pages/The_2011_OECD_guidelines_for_multinational_enterprises_163.a

spx?source=%2fpublicaties%2fbrochures%2fPages%2fdefault.aspx,

2) ILO declaration on fundamental principles and rights at work,

http://www.ilo.org/declaration/lang--en/index.htm and

3) UN Convention on biodiversity, http://www.cbd.int/convention/about.shtml.

In addition, the applicant should assure that the proposed activity is not on the FMO-exclusion

list, please see www.fmo.nl/exclusion-list. Activities on this list can not be funded by PSI.

PSI requires you, as applicant, to have a CSR policy in place that ensures the sustainability of

your activities. In this document you can find information about chain responsibility

requirements for PSI projects (chapter 2), tips to design the CSR policy of your company (in the

event that you do not have one) (chapter 3) and suggestions for integration of CSR in the

project results of your PSI application (chapter 4).

2. Chain responsibility in the PSI project according to the updated

OECD guidelines 2011

The updated OECD Guidelines of 2011 have extended requirements on chain responsibility:

companies should avoid negative impacts of their own business activities on the issues covered

by the OECD Guidelines. Moreover, enterprises are obliged to use their influence and leverage

on their business partners in the supply chain to prevent or mitigate negative impacts.

Therefore, PSI requires companies to carry out the following steps related to the chain

responsibility in the scope of the PSI project activities:

• Describe the most essential raw materials or semi-finished products necessary for the

manufacturing of the final product of the project. Which companies will be the suppliers?

(E.g. wooden particle board supplied by company X and steel frame by company Z in case of

a wooden table with steel structure). Do not include suppliers of gas, diesel, electricity,

water, telecom, packing materials or transport.

• Execute a risk analysis: to gain insight in the social and environmental risks in the supply

chain of your project, the risk analysis of the supply chain is based on the OECD Guidelines.

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The analysis concerns the entire upstream part of the supply chain of the most essential raw

materials or semi-finished products. Note that the supply chain includes the direct suppliers

of the project, but also the suppliers of the suppliers of the direct suppliers, etc. The supply

chain analysis should not include the downstream risks at your clients. There is also no need

to include CSR risks related to the direct implementation of the project, as those risks are

dealt with in the project proposal itself (see chapter 4 of this document). Start to inventory

the risks with one of your direct suppliers, then the risks with the supplier(s) of that

supplier, etc. Summarise the outcome of the analysis by describing the identified actual and

potential negative social and environmental impact in the supply chain of the project. To

facilitate you with the analysis of potential risks, MVO Nederland has developed a risk

analysis tool based on OECD. This tool can be found on the website www.mvorisicochecker.nl

(or www.mvorisicochecker.nl/en in English). The tool will yield only general risks of the specific

country and product, so it will be necessary to investigate the risks in your specific business

case. Check the actual risks of your future supplier by contacting your supplier or by

investigating its reputation through NGOs or others.

• Action plan: Describe the measures the partners will take and the targets the partners will

realise to prevent or mitigate these identified negative effects in the supply chain in an

action plan. It is important to make good agreements with your direct suppliers and make

them responsible for their suppliers. In case you identify a multinational company in your

value chain, check the chain responsibility chapter in its CSR policy on their website. In case

this is not satisfactory, consider alternative solutions, for instance you can try to find an

alternative supplier.

• Monitoring: Describe how the partners will monitor the implementation of their preventive or

corrective measures in the supply chain.

• Communication: Describe how the partners will communicate on the implementation of their

action plan, in case of a stakeholder's request.

In the event that no risks are identified in the supply chain, it is of course not relevant to make

action plans and describe your monitoring and communication activities.

In case it is not possible to implement a complete risk analysis of the supply chain, because the

project location and/or the supplier(s) are not yet identified, the risk analysis should be

executed as far as possible and include the requested descriptions in the proposal. The missing

part will be presented as part of the first project result, in case the project is approved.

Note that the applicant has the obligation, in the scope of Dutch public penal law in relation to

subsidies, to ensure that the partners and the main supplier to the project do not make use of

child or forced labour. In addition, if there are indications that child or forced labour is used by

partners or main supplier to the project, the Netherlands Enterprise Agency should immediately

be informed about this. In the scope of the updated OECD framework on CSR the partners

should than indicate how they will improve the situation.

3. How to design a CSR policy for your company

PSI requires the project partners to have a good reputation on CSR. The applicant, therefore, is

asked to submit their CSR policy document if it is already available. If the applicant doesn’t

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have a CSR policy document at the time of submitting the proposal, the applicant should

provide it with the first project result. For the other project partner(s) it is required to describe

their (informal) policies on CSR issues in the proposal.

In addition to the requirements as mentioned in the introduction above, it should be noted that

the CSR policy of the applicant should be based on the principles of the OECD guidelines, the

IFC Performance Standards or the ISO 26.000 and cover at least a number of its principles. In

other words, for example a Human Resource policy or safety policy is not a CSR policy, which is

broader and should encompass more than one of the issues as described in the OECD

guidelines.

Moreover, and in accordance with the updated OECD guidelines of 2011, a CSR policy should

include at least: the CSR policy as such, how it is implemented (action plan) and how progress

is communicated (communication plan) to relevant stakeholders (if they ask for it).

In the event that the company applying for PSI does not have an explicit CSR policy document,

or wishes to improve its existing policy, you may find the tips mentioned below useful. They are

based on the step-by-step plan on http://www.oesorichtlijnen.nl/en/other/csr-policy-tool.

• Study the OECD guidelines and make a selection of relevant guidelines for your company;

please see below an overview of the guidelines and useful questions that can help you apply

the guidelines to your own situation;

• If your company is internationally active, be sure to familiarise yourself with the

characteristics of the country and the local labour- and environmental legislation. The

Netherlands Enterprise Agency has developed, in collaboration with MVO Nederland, special

CSR documents for Brazil, Ghana, Indonesia, Morocco, South Africa and Vietnam;

• There is a multitude of sector and thematic (including environmental protection, labour

rights, human rights, fair trade) guidelines and codes available. At

www.oecdguidelines.nl/knowledge-center/tools-checklisten/ you can find specific codes and

checklists by theme;

• Further advice can be obtained, from your sector organisation, MVO Nederland

(www.mvonederland.nl/), and the Chamber of Commerce. Also you can ask your fellow

entrepreneurs about their practice abroad, exchange experiences and join forces.

For PSI the OECD guidelines are the framework for assessing the CSR policy of your company

and proposal. These guidelines are based on the UN human rights declaration (1948), the ILO

conventions (1919-2007) and the UN declaration of Rio on the Environment and Development

(1992).

Since PSI supply chain responsibility is a very important issue for PSI, this is added as a

separate topic to the guidelines below. In the OECD guidelines supply chain responsibility is

included in the first theme called 'Concepts, Principles and Human Rights'.

Below you will find short questions that you may find useful as a tool to further develop your

CSR policy for each of the relevant themes. You should focus your CSR policy according to your

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own assessment of themes that are of particular relevance and importance for your product or

activity depending on your sector or size.

I. Concepts, Principles and Human Rights: what is the vision of your company regarding your

employees, your suppliers, your clients and investors in relation to attitude, sustainability,

capacity development? How do you deal with the impact that your activities may have on

others, in particular when these effects are detrimental?

II. Disclosure: is your CSR policy, including codes of conduct, public and published on your

website? Does your company publish a CSR report on an annual basis?

III. Employment and industrial relations: do you have fair and transparent labour contracts for

all workers? What is your policy regarding salaries and secondary labour conditions, in

particular on wage levels (for example living wage), medical care and training? Does your

company utilise effective health and safety instructions and do you train your workers in

this?

Regarding the ILO Labour rights:

a. Are your workers free to organise themselves in a labour union, a works council or

other parallel means for worker representation?

b. Is your company free of child labour or forced labour?

c. Is your company free of discrimination in selection and recruitment on the base of

race, colour, gender, religion, political opinion, nationality or social background?

IV. Environmental protection: does your company utilise effective instructions and do you train

your workers in this? Does your company have an environmental management system in

operation? Is your company continuously improving its environmental performance by

savings and the implementation of clean innovative technology?

V. Combating bribery: does your company have a policy on combating bribery and do you

train your workers in this?

VI. Consumer interest: do all your products and services meet the legal requirements with

regard to health and safety?

VII. Science and technology: does your company contribute to the scientific and technological

development of the host country?

VIII. Competition: is your company free of anti-competitive agreements like price agreements or

illegal division of markets?

IX. Taxation: does your company pay tax in the host country?

X. Supply chain responsibility: are you familiar with the whole supply chain and where the

vulnerable parts are? Are you aware if all products that you procure are produced in

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accordance with the OECD guidelines in particular regarding child and forced labour? Do

you produce according to a quality standard?

For more examples please refer to http://www.mvonederland.nl/praktijkvoorbeelden.

4. Application of CSR in your project proposal

PSI requires your local venture to be set up in accordance with CSR principles and practices.

Below you can find an overview of various ways in which CSR can be integrated in the project

results of the proposal. You may decide for yourself the most relevant and important aspects in

relation to the specifics of your project, location and sector.

Of all OECD guidelines the following CSR themes can be included in the Results of your PSI

project proposal:

Ad. I. Concepts, Principles and Human Rights:

− Human Rights (4.1)

− Rights of local community (4.2)

Ad. III. Employment and industrial relation:

− Labour norms (4.3)

− HRM policy (4.4)

− Staff participation (4.5)

− Health and safety (4.6)

Ad. IV. Environmental protection ad. VI. Consumer interest:

− Environment and food safety (4.7)

Ad V. Combating bribery (4.8)

Ad. X. Supply chain responsibility (4.9)

Please note that broader community initiatives, like for example setting up of hospitals or

schools to strengthen the local community, are not considered as being part of CSR. These

activities do benefit the local community but are not related to the core business of the

company.

4.1 HUMAN RIGHTS

Are you aware of any human rights abuse in the region where you want to operate your

business? What is the attitude of your local partner towards the issue?

http://www.ilo.org/declaration/lang--en/index.htm

4.2 RIGHTS OF LOCAL COMMUNITY

Did you ensure that there are no (traditional) claims of local communities on land, vegetation,

water rights, etcetera?

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Regarding land acquisition, please refer to the Voluntary Guidelines on the Responsible

Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security

(FAO). In paragraph 2.2D of the proposal you should describe how the rights of the current

tenure right holders will be recognized and respected. This means that you will have to

investigate who are the current owners of the land or the resources, recognize and respect their

legal rights. In case of land acquisition the latter means that your company is responsible for

the provision of a fair compensation according to the norms (also in case the local Government

will implement the compensation).

An example of how the local population could be informed on your business plans:

Sub-results: Means of Verification:

• Signed long-term land agreement. • Copy of legally signed land lease contract,

in English.

• Copy of the letter legally signed by the

local community agreeing on the

implementation of the lodge.

4.3 LABOUR NORMS

Labour norms include issues like labour contracts, working hours, minimum age, salaries, law

on dismissal, insurance. Some examples:


• 200 employees contracted of which at least

100 are female. The salaries are at least ??

% above minimum wages.

• 100 employees contracted. The salaries are

at least USD ??/month, based on 48

working hours / week (maximum normal

workweek) and exclusive of secondary

allowances. For overtime, a policy is

developed that is in line with standards like

that of the Fair Wear Foundation

(http://fairwear.org/), which covers a.o. the

maximum overtime of 12 hours per week

and pay another USD ??/month above

minimum wages and/or pay living wage.

• Employment records including name, date

of birth, gender, salary and position and

copies of different labour contracts.

• Copy of statement of the Royal Netherlands

Embassy, concerning the minimum wages

according to local standards.

• Description of secondary working

conditions and compensation schemes.

• Pre-audit SA 8000 (http://www.sa-intl.org/)

carried out by an independent validation

company.

• Copy of pre-audit report, approved by the

Netherlands Enterprise Agency.

Companies paying living wages will be given preference for PSI funding. A living wage can be

defined as: “a wage that is enough to meet the basic needs of the worker and his or her family.

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Basic needs are food, housing, clothing and other costs, such as education and medical costs.

An additional component that is sometimes included is discretionary income” (Berenschot).

A method to determine the level of the living wage in your specific country can be found on

www.berenschot.nl/markten-sectoren/markten-sectoren/leefbaar-loon.

4.4 HRM POLICY

For example social facilities in addition to the salaries like housing, accommodation, meals,

medical care, transport, training, education, maternity leave, gender policy. Some examples:


• HRM-policy implemented, including

minimum age of the workers of the

company, female employees and the

facilities provided by the employer (free

lunch and transport, adult educational

programmes, sponsorships, costs of school

for children).

• Copy of the HRM policy.

• HRM policy document that complies with

the codes of conduct of the Fair Wear

Foundation.

• 200 employees being trained according to

the training programme and logbook

(including on the job training).

• Updated training logbook and training

report drafted by the trainer covering all

training subjects, all days on which training

was actually given and names of trainees

and trainers.

• Letter of satisfaction relating to all trained

staff concerning the level of knowledge

required for their operational activities,

legally signed by the recipient.

• Copy of some of the training certificates.

• Finalised plan for the establishment of a

social fund in which EUR ?? per ha will be

invested if production exceeds ?? ton/ha.

• Copy of the plan.

• Detailed description of the management

procedures of the Education Children

Village Fund of the employees.

• A copy of the programme and management

procedures with detailed information

regarding ownership of the fund (by

employees), withdrawing procedures (both

parties involved), persons with access to

the fund.

• System for staff-incentives and

shareholding in the Joint Venture is in

place.

• Minutes of meetings with management and

staff.

• Copy of agreed conditions for shareholding

of management and staff.

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4.5 STAFF PARTICIPATION

The possibility of the workers in your company to organise themselves in a labour union, a

works council or other parallel means for worker representation to have influence on the

management decision making.

4.6 HEALTH AND SAFETY

This includes for example to have a safety plan, use protecting clothing and devices, health

insurance, HIV/AIDS policy. Some examples:


• Health care and HIV/AIDS prevention

programme.

• Copy of a health care contract with health

care provider or insurance contract.

• Copy of the HIV/AIDS prevention

programme.

• Brochures and attendance lists of

meetings.

• A detailed health and safety programme

has been developed.

• A copy of a detailed health and safety

programme.

• A report on health and safety training

provided to all employees.

• IPC certification

(http://www.ipc.org/default.aspx) by

independent validation company.

• Copy of IPC certificate.

• Pre-audit SA 8000 carried out by an

independent validation company.

• Copy of pre-audit report, approved by the


4.7 ENVIRONMENT AND FOOD SAFETY

The use of energy/fuel, water, soil, vegetation, genetic material, chemicals, pesticides, animal

breeding, emissions and waste production can all have an impact on the environment. The aim

here is to demonstrate that the impact of the project on the environment will be positive, or in

any case will not be excessive. This can be done by having independent organisations issue

certificates or by taking demonstrable measures yourself. Certification often also has

advantages with regard to establishing and maintaining a market position.

A company implementing a PSI project, declares that it will adhere to the local rules and

regulations. This means that all necessary building permits will be arranged. Prior to the start of

the construction phase, the company will check with the relevant authorities whether it needs to

implement an Environmental Impact Assessment (EIA). In case an EIA needs to be executed,

the Netherlands Enterprise Agency will need a copy of the report.


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• Environmental Impact Assessment (EIA)

done.

• Copy of the Report through a registered

certified company of the EIA, approved by

the relevant authorities/the Netherlands

Enterprise Agency.

Here is a list of possible certificates and measures per sector:


Horticulture

• MPS-GAP (http://www.my-mps.com/) and

MPS-SQ certification of the Joint Venture

obtained from independent validation

company.

• Copy of MPS-GAP and MPS-SQ certificates.

• MPS-A and Ethical Trade Initiative (ETI)

(http://www.ethicaltrade.org/) declaration of

the Joint Venture by independent validation

company.

• Copy of MPS-A certificate and ETI

declaration.

• Corporate social responsibility (CSR) plan

developed.

• Copy of the CSR implementation plan,

including employment conditions,

promotion of IPM and MPS and including

the company protocol of proper handling of

chemicals and chemical waste.

• Environmental Impact Assessment (EIA)

done.

• Copy of the Report through a registered

certified company of the EIA, approved by

the relevant authorities/the Netherlands

Enterprise Agency.

Food safety in de agro-business

• HACCP inspection of factory by

independent validation company and

obtaining of the certificate.

(http://www.agriholland.nl/dossiers/kwaliteitssy

stemen/haccp.html)

• Copy of HACCP certificate.

• Certification on Fair trade

(http://www.fairtrade.nl/), organic production

(http://www.eko-keurmerk.nl/) and Global-

GAP (http://www.globalgap.nl/) of the Joint

Venture by independent valuation

company.

• Copy of certificates.

• Copy of certification reports.

• Completed factory design and engineering • A copy of the factory design and

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plan. engineering plan, signed for approval by all

Joint Venture partners. Recycling of the

waste water will be taken care of.

• Progress report, complemented by (a)

proposed veal production and animal

welfare quality standard(s).

• A progress report containing a final and

detailed implementation plan, all

documents stated in this result (see the

reporting instructions in Appendix 3) and a

proposal for veal production and animal

welfare quality standard(s), which can be

verified by Stichting Kwaliteitsgarantie

Vleeskalveren (SKV) with possible

exclusions as a result of … circumstances.

Garment and textiles

• Facilities for dying fabrics installed and

tested with a capacity of 2,500 kg per day.

Waste water treatment and water effluent

plant installed and tested.

• Copy of the report of the waste water

analysis, implemented by an independent

body at the moment that the system is

functioning, showing that the discharged

waste water complies with the norms.

• Oeko-tex certificate obtained

(http://www.okotex.com/OekoTex100_PUBLIC/i

ndex.asp?cls=02).

• Copy of Oeko-tex certificate.

• SA 8000 or Fair Wear certification of

factory by independent validation

company.

• Copy of audit report.

• Copy of contract for the implementation of

SA8000 certification or Fair Wear

certification.

Wood and forestry

• Forest management FSC certified

(http://www.fsc.nl/nl/index.phtml).

• Copy of FSC certificate.

• Plantation management certified (FSC and

carbon credits).

• FSC certification.

• Carbon Credits certification.

• 5 Wood waste suppliers pre-audited in

FSC-Chain of Custody by an independent

validation company.

• Copy of the pre-audit report.

Fishery

• Finalisation of full assessment Marine

Stewardship Council (MSC) certification

(http://www.msc.org/).

• Copy of MSC certification.

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Industry

• ISO 14001 Certification obtained. • A copy of the ISO 14001 certification and

manual.

• Completed design of the Glass Technology

Centre.

• A copy of the design of the glass centre,

with the production process according to

the rules and regulations of the

Environmental Protection Authority, signed

for approval by the Joint Venture partners.

• Copies of required building permits.

Eco-tourism

• International ecotourism certification of the

eco-resort by independent validation

company.

• Copy of certificate.

• Overview of developed eco-tourism

packages for tourists.

• Construction of eco-resort, including waste

water treatment system.

• Independent proof of the quality of the

waste water treatment system.

• Completed design of the site and

construction implementation plan, including

the ecotourism certification process.

• Copy of the report on the environmental

impact assessment performed by a

registered and certified company.

Energy sector

• Environmental and Social Impact

Assessment (EIA) completed of the 100 ha.

Implementation of the EIA will be done in

close cooperation with the Royal

Netherlands Embassy and local NGOs,

possibly with assistance from the

Netherlands Commission for Environmental

Assessments.

• Copy of the report through a registered

certified company of the EIA of 100 ha, to

be approved by the Netherlands Enterprise

Agency. The EIA will be implemented

according to local law. Specific attention

will be paid to the impact on the use of the

water (both quantity and quality) and the

impact on local users of the natural

resources in the area.

• Copy of the agreement letter between the

Joint Venture and the possible current

users of the area of 100 ha.

• Completed design plan of the 100 ha,

based on the sustainability guidelines of

the Commission Cramer and "Stichting

Natuur en Milieu".

• Baseline study conducted according to the

guidelines of the Commission Cramer and

"Stichting Natuur en Milieu".

• A copy of the design of the 100 ha, signed

for approval by all Joint Venture partners.

• Copies of required permits (import license

of Jatropha seedlings and water user

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rights).

• Monitoring system in place on the

implementation according to the

sustainability guidelines of the Commission

Cramer and "Stichting Natuur en Milieu".

• Copy of the outline and organisational set

up of the monitoring system.

• Certification of the bio-oil according to the

guidelines of the Commission Cramer and

"Stichting Natuur en Milieu" by independent

validation company.

• Copy of certificate.

Framework for Sustainable biomass Commission Cramer:

http://www.rvo.nl/sites/default/files/bijlagen/Cramer_toetsingskader_2007_NL.pdf

4.8 COMBATING BRIBERY

How does the company deal with bribery, bureaucracy and red tape?

(http://www.transparency.org/)

4.9 SUPPLY CHAIN RESPONSIBILITY

This may concern the responsible use of materials, good production conditions for environment

and personnel, or the characteristics of the end product in terms of safety, energy efficiency and

low emission during use. As some of these issues have already been considered under previous

themes, we will focus here on the responsibility of the Joint Venture regarding the raw materials

to be purchased from third parties (sustainable purchasing).

Specific PSI requirements on chain responsibility are presented in chapter 2 of this document.

This paragraph will make some suggestions how to integrate chain responsibility in your supply

chain and in the project results.


• Wood or forestry project FSC certified. • Copy of the FSC certificate.

• Fish project: Finalisation of full assessment

Marine Stewardship Council (MSC)

certification.

• Copy of the pre-assessment document

made by an independent MSC certification

company concerning MSC certification of

the PSI-project.

• Copy of MSC certification.

• Long term supply contracts with

(cooperatives of) local farmers, which

guarantee a reasonable income to the

farmers and guarantee a price increase of

about USD ??/MT in case they comply with

the quality standards set by the Joint

Venture.

• Copy of the contracts with local suppliers,

to be approved by the Netherlands

Enterprise Agency.

• Statement of an independent (mutually

agreed) NGO that the conditions in the

farmer contracts are reasonable, in English.

• High quality galvanisation by third party. • Copy of contract at least stating

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galvanisation standards according to

country environmental protection and

labour law.

• Realistic plan on battery recycling finalised. • Copy of the plan, approved by the


• Fair Trade/FLO certification of the products

by an independent validation company.

• Copy of FLO certificate.

• Production of bio-fuel according to the

Criteria of the Cramer Commission, see link

below.

• Copy of the report of an independent

auditing company.

Framework for Sustainable biomass Commission Cramer:

http://www.senternovem.nl/mmfiles/Toetsingskader%20duurzame%20biomassa_tcm24-232793.pdf

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ANNEX 1 ANONYMOUS EXAMPLE OF CSR POLICY OF A COMPANY

The company is committed to the following values and principles, which will be laid down in the

company policy approved by its employees:

1. The company provides for the livelihood of its employees, while serving as a reliable

partner for its suppliers, clients and investors.

2. The company aims to provide interesting and challenging work in a safe and responsible

setting and will remunerate its management and middle level employees at competitive

rates and its low level employees at rates above the industry average (at least 150% of

minimum wages).

3. Non discrimination, particularly on the basis of race, colour, sex, sexual orientation,

disability, marital status, age, religion, political opinion, union membership, or social origin

in recruitment, promotion, access to training, remuneration, allocation of work, termination

of employment, retirement or other activities.

4. Personal development and capacity building: The company will annually set a target for

social development with employee representatives. The plan details social goals, ways to

achieve and measure the goals, timeframes and resources. Management is responsible for

the allocation of the resources (funds, personnel, time…) and workers take responsibility in

implementing the measures; At least one working hour in every week is dedicated to

technical and general training provided by an internal or external resource person. All new

employees undergo basic training and instruction in the company values, rights and duties,

work safety, code of conduct and environmental issues.

5. Freedom of labour: There is no forced or child labour. Copies of official identification

documents for each employee are kept on file. Employees are free to join any trade unions

and trade unions are given access to workers provided good manners and due notice are

observed.

6. Employees are encouraged to participate in daily work issues. Each department will hold

regular meetings in which employees can suggest improvements.

7. Corruption will not be tolerated. Notices and a suggestion/grievance box serve as a tool to

prevent corruption.

8. Women empowerment It is our target to employ at least 50% female workers on each

level of the company, and give women priority in case of equal qualifications. One woman

will be appointed as a spokes person on women matters, reporting directly to the MD or

any other appropriate person.

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9. Work safety: Workplaces, machinery and equipment on the production site must be as safe

as possible and any inherent health hazard will be minimised by adequate control

measures:

√ Risk areas and potential hazards will be clearly marked with warning signs in local

languages and pictograms;

√ Safety instructions and procedures including accident prevention and response will be

part of staff training;

√ All hazardous machinery and equipment will have adequate safety devices. Protectors

must be placed over moving parts;

√ Safety equipment will be provided to all workers. Workers will be instructed and

monitored in its proper use;

√ The following persons are not allowed to be engaged in any potentially hazardous

work: persons younger than 18 years, pregnant or nursing women, persons with

incapacitating mental conditions, persons with chronic, hepatic, renal or respiratory

diseases;

√ Electrical equipment, wiring and outlets are properly placed, grounded and inspected

for overloading and leakage by a professional on a regular basis;

√ Fire exits, escape routes, fire fighting equipment and fire alarms are provided for every

indoor workplace. They are properly marked and kept clear of obstructions, allowing

swift and safe exit during emergencies;

√ All indoor workplaces have adequate lighting and ventilation;

√ The company premises and its surroundings will be free of obvious defect and

maintained in a safe, and where necessary hygienically clean condition;

√ The company provides all workers with necessary work clothes appropriate to their

tasks free of charge. Such work clothes are replaced regularly. All workers must have

access to drinkable water and clean sanitary facilities;

√ A health and safety officer (H&S) is appointed to monitor potentially hazardous areas

and suggest preventive measures;

√ The company provides adequate emergency first aid facilities, equipment and

appropriately trained first aid staff to meet all reasonably foreseeable emergency first

aid situations. Any work accidents and related first aid measures must be reported to

the H&S officer;

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√ Workers and their representatives are trained in the basic requirements of occupational

health and safety, relevant health protection and first aid. Special measures are taken

to identify and avoid reoccurring health risks to vulnerable workers operating in high

risk areas;

√ The company is committed to preserving the natural resources and to take care of the

environment.

10. Waste will be kept to a minimum and separated:

√ Organic waste will be treated in the bio gas plant and the methane produced will be

used as energy supply. The waste (compost) will be used as an environmentally safe

organic fertiliser;

√ Metal waste will be sold to local scrap dealers;

√ Plastic waste will be sent to recycling plants;

√ Waste water will be treated in the biogas plant and the residual water will be filtered

and used for irrigation of trees and green surfaces.

11. Energy All possible ways of energy conservation will be explored. Electricity consumption

will be kept to a minimum by use of up to date equipment and sensible use of light and

cooling. Energy consumption will be kept to a minimum by heat recovery from the drying

system, by employment of bio gas and by employment of solar heating.

12. Water consumption will be kept to a minimum and all grey water will be recycled for

toilet flushing and irrigation of green surfaces. Water consumption will be limited by use of

flow reduction valves, by maintenance of the water distribution system and by continuous

training of the workers.

13. Chemicals The company will employ in its production processes only chemicals and

detergents which are approved in organic production and processing or which are

biologically degradable and can not contaminate the environment.

14. Raw materials procurement. The company will not process raw materials and ingredients

derived from GMOs, procuring raw materials only from suppliers who apply appropriate

environmental standards (such as GlobalGAP certification or internal monitoring).

PSI is very grateful to the company concerned that has supplied its CSR policies.

NB company information remains anonymous.

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ANNEX 2 ANONYMOUS EXAMPLE OF CSR POLICY OF COMPANY

Corporate Social Responsibility Policy

and Code of Conduct

The company is achieving commercial success in ways that honour ethical values and respect

people, communities and the natural environment by minimising any negative environmental

and social impacts and maximising the positive ones. In general the company is managing its

business to achieve both commercial and social benefits. In essence it's about managing our

social, community and environmental impacts in order to improve our results, reduce risks and

enhance our reputation. It is also about growing our business in a way that has value for

everyone connected to it. The Corporate Social Responsibility Policy of the company is actually a

balance between financial, environmental and social performance.

People, Planet and Profit

Sustainable horticulture: using the land and its people wisely

To be sustainable, horticulture must make economic sense and be both environmentally friendly

and socially viable. The company recognises concerns about the impact of farming and is

committed to participation in all these areas. The company works closely with farmers on such

issues.

The company aims to be open, accountable and responsive to stakeholder concerns.

We believe that business, social and environmental performance are mutually dependent.

At the company, they go hand in hand, so all our stakeholders benefit from the company's

activities by supporting sustainable horticulture and ethical business practices.

Our Code of Conduct which enables us to act accordingly to the Corporate Social Responsibility

Policy can be divided into our Ambitions and our Commitments:

Ambitions:

1. The company will operate in a sustainable manner in order to create long-term value

through superior financial performance.

2. The company's core values – ambition, trust, teamwork and accountability – will be

reflected in our behaviour and in our business conduct.

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3. The company will take a leading role in the sustainable development of the industry

through an active dialogue and cooperation with all stakeholders.

4. The company will drive the industry in pursuing common high standards and anchoring

best practices.

5. The company will promote product stewardship to ensure that the entire value chain, from

raw material sourcing to end use, is rooted in sustainable conduct and consideration for

health, environment, safety, quality and food safety.

6. The company will support the development of sustainable horticulture.

Commitments:

1. We will communicate promptly, completely and accurately with our customers, employees,

suppliers, community members, shareholders, regulators, and all others with whom we do

business. We will not mislead these stakeholders and will only make promises to them that

we can keep.

2. We will maintain accurate and reliable records to meet our legal and financial obligations

and to manage our affairs. Our books and records will reflect accurately all business

transactions.

3. We will not permit undisclosed or unrecorded revenues, expenses, assets or liabilities. We

will never create or participate in the creation of records that are misleading.

4. We will cooperate fully with the company’s internal and independent auditors.

5. We will avoid conflict of interest situations. We will avoid any situation that may create, or

may seem to create, a conflict between personal interests and the interests of the

company.

6. We will make a positive contribution to the societies in which we operate by providing

employment, investing in infrastructure and supporting local initiatives.

7. We will encourage our employees to use on the job training, rotation and education to

further their personal and professional development.

8. We will strive to minimise the environmental impact of our operations.

9. We are committed to fairness in the workplace and will respect the rights, culture and

dignity of all individuals. We will act fairly and justly and will not tolerate any form of

discrimination or harassment directed at any individual or group.

10. We will comply with the laws, rules and regulations in the countries and communities in

which we operate.

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11. We will never offer, pay, solicit or accept bribes in any form, either directly or indirectly. If

and to the extent appropriate under the circumstances, we may give or accept gifts and

entertainment that are for business purposes, that are not material or frequent, and that

reflect the customs in the industry and local settings.

12. We will always compete vigorously and independently in the conduct of our business. We

will not act in retaliation of antitrust or competition laws in any of the jurisdictions in which

we do business.

13. We will not make contributions to political parties or participate in election campaigns. This

does not in any way restrict the freedom of our employees to participate in political

activities.

14. We will seek business partners that foster trust in our relationship. When considering a

business partnership, we will base our choice of partner not only on economic

considerations, but also on a number of other factors, including, where appropriate, safety,

health, environmental management and sustainable conduct.

15. We will work to minimise environmental impact throughout the value chain and apply

technology and methods to this end.

For example:

• Soil conservation: Develop and promote programmes to minimise soil erosion and

improve soil productivity. Establish local programmes to transfer knowledge to farmers

and technical advisors.

• Water quality: Maintain and improve quality of water and promote efficient water use.

Contribute to development of expertise in water management.

• Integrated Crop Management (ICM) / Integrated Pest Management (IPM)

To encourage farmers to use crop protection products in accordance with ICM/IPM.

Establish programmes to teach ICM / IPM methods.

Training & Educate users on safe and effective crop protection product use.

Everything in full compliance with national and international regulations.

16. We will encourage safety conscious behaviour, both in the workplace and beyond. We seek

to create an incident and injury free work environment for all employees and contractors.

Our employees will play an active role in identifying and rectifying unsafe situations.

17. We will cooperate with customers, suppliers and partners to encourage the safe and correct

handling and use of our products.

18. We will stimulate improvement throughout the value chain by conducting an active and

open dialogue with customers, partners and other stakeholders.

19. We will support, promote and lead industry organisations that promote these goals and

work actively with governmental and non-governmental organisations to achieve them.

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20. We will actively support technological innovation to improve and enhance horticultural

productivity.

ACHIEVING OUR AMBITIONS

AND ACTING ON OUR COMMITMENTS

The ambitions and commitments that we have stated are intended to guide the conduct of all of

the directors, officers, employees and representatives of the company. Each of these individuals

is responsible for making sure that our business decisions and actions comply at all times with

the letter and spirit of this Corporate Social Responsibility Policy and Code of Conduct.

√ All the company supervisors and managers, including our officers and directors, have a

responsibility to lead according to our ambitions and commitments in both words and

actions.

√ All the company supervisors and managers are expected to promote these ambitions

and commitments and to be available to anyone with concerns, questions or complaints

about them.

√ All the company employees are encouraged to raise questions or issues about these

matters with their supervisors.

√ All concerns, questions and complaints will be taken seriously and handled promptly,

confidentially and professionally.

√ No retaliation will be taken against any employee for raising any concern, question or

complaint in good faith.

OUR SUCCESS IS DEPENDENT UPON THE PUBLIC TRUST

AND OUR ETHICAL REPUTATION

By following up closely mentioned ambitions and commitments below standing objectives have

been enlisted as the desired end-results:

√ The company acts for the benefit of profit, people and planet.

√ The company's employees value it as a great place to work.

√ The company has a good health and safety record.

√ The company attracts, retains and develops motivated and committed employees.

√ The company’s customers and suppliers value it as a good business to do business

with.

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√ The company encourage support for local not-for-profit and community-based

organisations.

√ The "Country" community values the company as a great "neighbour".

√ The company improves business reputation and positive publicity of the horticultural

industry.

√ The company has environmentally friendly premises.

√ The company distributes materials from suppliers/producers that use sustainable

sources.

√ The company pays staff, suppliers and creditors on time.

√ Anticipating future legislation and protecting our business.

PSI is very grateful to the company concerned for providing its CSR policies.

NB. Company information remains anonymous.

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