Unilever is committed to doing business with integrity. This commitment reflects our company values and underpins the way we operate.
Integrity is the foundation on which we do business
Unilever’s Code of Business Principles (launched in 1995) and 24 related Code Policies (updated in 2016) help us put our values of integrity, respect, responsibility and pioneering into practice. They are mandatory for all employees and others working for Unilever, including our board of directors, and apply to all Unilever companies, subsidiaries and organisations over which Unilever has management control.
The Code and Code Policies underpin our Business Integrity programme. They reflect our desire to combat corruption in all its forms. This includes not only fraud and financial misrepresentation, conflicts of interest, bribery and facilitation payments but also antitrust violations and misuses or misappropriations of competitor information. We also seek to apply the UN Guiding Principles on Business and Human Rights to underpin our own high standards of corporate behaviour.
The Code Policies provide a framework of simple Musts and Must Nots designed to be readily applied day-to-day, and for which all individuals are held accountable. Our goal is to embed a culture of deliberately high standards and behaviours in the workplace, to promote and protect the good reputation of Unilever as well as respecting all applicable laws and regulations.
We seek to implement clear risk-based controls to mitigate potential breaches of our Code and Code Policies. We regularly communicate standards of behaviour required from Unilever leaders and their teams. We are clear on consequences of misconduct. We encourage individuals to bring any breach or concerns to our attention, including any relating to suppliers or other parties we do business with. We will not tolerate retaliation against anyone who reports a potential or actual breach.
We have developed specific tools that set out standards of integrity we expect from third parties who interact with us. In addition to sharing our Code of Business Principles and Code Policies on our Unilever.com site, we launched the following:
- A Responsible Sourcing Policy (PDF | 5MB) that since 2014 forms the basis of ongoing constructive dialogue with our suppliers on the standards we expect them to meet, and will work with them to achieve; and
- A Responsible Business Partner Policy (PDF | 3MB) in 2015, which applies to other third parties and is being piloted within Unilever’s downstream route to market network.
Our framework for integrity
Unilever’s longstanding Business Integrity framework has three pillars: Prevention, Detection and Response. This encompasses activities designed to ensure that the way we do business is fully aligned with applicable laws and regulations in the countries where we operate, as well as with our values - we often set requirements that go above those set by laws.
Since 2015, a Chief Business Integrity Officer, reporting to the Chief Legal Officer, is responsible for advising on the strategy and execution of our global Business Integrity programme. Building on our established framework, our goal is to proactively address rapidly evolving trends and challenges.
Our Chief Executive Officer sets a compelling tone from the top: his communications makes clear that adherence to our Code of Business Principles and Code Policies are non-negotiable. Other members of our Executive are also vocal champions for our Business Integrity programme.
Every country CEO is accountable for business integrity and related compliance matters. At Unilever Board level, our Corporate Responsibility Committee has oversight of the implementation of the Code and Code Policies. Our Audit Committee is updated on relevant compliance developments.
Global oversight of operations is further maintained through our Global Code & Policy Committee (GCPC). The GCPC is chaired by the Chief Legal Officer and comprises the Chief Business Integrity Officer, Chief Auditor, Chief Procurement Officer, Chief Customer Officer, SVP Human Resources, Global VP for Social Impact and other leaders are invited as needed.
Since 2015, the Chief Business Integrity Officer leads a network of local and regional Business Integrity Officers as part of the Legal function. The Business Integrity team operates in close collaboration with internal stakeholders, including specialist subject-matter experts. The Business Integrity team also oversee Unilever’s work on third-party compliance risks.
Local Business Integrity Officers assist Market Clusters and local Business Integrity Committees in deploying a globally coherent Business Integrity programme. Their role is to run investigations into alleged breaches of the Code of Business Principles or Code Policies or local third party compliance programmes.
In-country Business Integrity Committees typically comprise the Country Chairman, Heads of Finance, Human Resources, Supply Chain, Customer Development and Legal, and other representatives as required. The Chief Legal Officer and Chief Business Integrity Officer oversee all investigations involving senior executives regardless of where they are located.
In 2014, Unilever established a global Procurement Business Integrity Committee (PBIC) with specific responsibility for reviewing third-party compliance issues arising from the global deployment of our Responsible Sourcing Policy.
Our ‘Prevention’ strategy includes reporting channels, management reviews and risk assessments.
Our Code of Business Principles and Code Policies are at the heart of our Business Integrity framework. Today’s 24 Code Policies are grouped to cover four core themes:
- Respecting People
- Safeguarding Information
- Countering Corruption
- Engaging Externally.
They play a key role in setting out how we seek to ensure compliance with laws and regulations, protect our brands and reputation, and prevent harm to people or the environment.
Code compliance is mandatory for directors, employees, contractors and individuals who act on behalf of Unilever. Our Code Policies set out minimum standards of behaviour, including simple Musts and Must Nots that can be readily applied day-to-day, for which all individuals are held accountable. Where necessary Unilever develops further internal functional standards and guidelines. Substantiated Code breaches attract internal sanctions, which may include dismissal.
Training & awareness
Significant efforts go into maintaining high awareness of the Code and Code Policies. We provide employees with regular, mandatory training – both online and face-to-face, designed to reflect key risks and user needs. Corporate leaders, including our Chief Executive Officer and Unilever Board Members, also receive training. We follow up on non-completion of mandatory training and take disciplinary action where required.
The Business Integrity team helps local stakeholders to develop materials tailored to local needs, including as regards languages used to communicate. Our training targets not only office-based employees, but also those working in factories and more remote areas.
We monitor and benchmark our training programme to ensure continuous improvement and successfully embed a culture of business integrity. Where needed and with input from our subject-matter experts, we develop advanced guidance on specific areas covered by our Code Policies to employees in higher risk positions.
Training is complemented by a globally designed but locally implemented communications campaigns. Our 2015 materials were designed for “freedom within a format” deployment so local teams could finalise their campaigns using scenarios tailored to their needs. The scenarios covered antitrust, data privacy, discrimination, bribery and conflicts of interest. They were supplemented by a company-wide news story on “The History of Business Integrity” that highlighted Unilever’s strong legacy. Our 2016 approach focuses on the important role every individual plays in living our values.
Members of the Business Integrity community liaise regularly to ensure global coherence and two-way exchanges on compliance activities – so best practices can be shared, and any feedback or specific queries addressed promptly.
Risk assessment & due diligence
The implementation of our Business Integrity programme reflects a risk-based approach. We constantly seek to improve our analytical capabilities so trends, hot spots and root causes are rapidly identified and remediated through appropriate controls.
Managing third-party risk remains a priority: since the deployment of the Responsible Sourcing Policy, risk assessments and due diligence of our supply chain help us identify whether specific third parties pose a legal or reputational risk, and determine how best to address concerns. Other aspects of our operations, are also being progressively addressed through the Responsible Business Partner Policy we are piloting.
Our ‘Detection’ strategy includes reporting channels, management reviews and proactive assessments that seek to highlight and address any potential concerns that may arise.
Raising concerns & reporting channels
We are committed to a culture of transparency - where all stakeholders confidently speak up about issues. We offer internal and external channels for raising concerns, anonymously if required, and continue to take measures to encourage third parties to contact us about any aspect of our work that may raise concerns. We have a clear “no retaliation” policy.
Since 2012, we provide a web-based reporting process for both employees and suppliers, in addition to existing telephone and email reporting systems. Employees can also report concerns to their line manager, local Business Integrity Officer or a member of their local Business Integrity Committee. Alternatively, they can use our confidential external ‘Unilever Code Support Line’ (whistleblowing line) via telephone or internet. Business Integrity training and communications materials provide details of available options.
Annual employee/director declarations
All Unilever managers and directors are required to sign an annual declaration to confirm they have reported any known or suspected Code breaches. Exceptions are systematically investigated.
Management review & reporting
Our Global Code & Policy Committee meets quarterly. It reviews our Business Integrity strategy, the adequacy of our controls and management systems, performance on training, status of investigations and associated sanctions. At a country level, our Local Business Integrity Committees review and report quarterly on significant compliance risks and mitigations, training and awareness efforts, status of investigations and sanctions including disciplinary and asset recovery proceedings.
Our Procurement Business Integrity Committee reviews responsible sourcing and quality audit issues, red flags for risk, and other issues relating to non-compliance by our suppliers.
Compliance self-assessment & audits
Our operating companies must periodically review their business integrity-related profile to identify areas for improvement. Risks identified through this assessment are addressed as part of local, or where appropriate, global mitigation plans. This stock-take exercise is available for independent review by our Corporate Audit function. We have additional detailed controls for preventing financial accounting errors and fraud. Our financial controls are externally audited annually. Additionally, our Corporate Audit function includes the audit of Business Integrity controls in their scope of business unit audit work.
Our ‘Response’ strategy includes investigations, sanctions and continuous improvement.
We set internal guidelines for handling investigations into potential breaches of our Code and Code Policies. This includes clear processes for managing cases involving potential bribery or money laundering. These guidelines are applicable to all our business units.
In 2015, we investigated and resolved 1,027 incidents across all areas of our Code. We identified 402 confirmed breaches of our Code, issued 116 written warnings (30 with a downgrade in individual performance rating), initiated 13 cases of legal action and dismissed 175 employees.
Sanctions & consequence management
We rely on an internal global Business Integrity Sanctions Standard to ensure sanctions are applied consistently with the requisite seriousness and fairness. In particular, potential mitigating and aggravating circumstances are outlined to guide Business Integrity Committees in determining appropriate sanctions. We monitor cases centrally to ensure a consistent approach.
Root cause analysis & continuous improvement
We use trends identified from investigations, market assessments and audit findings to feed into our continuous improvement programme. Additionally we engage with thought leaders and peer companies to understand and aspire to best practices.
Unilever is a Corporate Supporter of Transparency International and a founding signatory of the United Nations Global Compact. We are also an active contributor to various International Chamber of Commerce initiatives, including its Task Force on Compliance & Advocacy in the field of antitrust (which published a highly acclaimed global ICC Antitrust Compliance Toolkit and related SME Toolkit).