8.2 Society

MANAGEMENT APPROACH ANTI-CORRUPTION

As a member of Transparency International Switzerland and the UN Global Compact, Geberit is committed to high standards in combating corruption. There are clear guidelines on prevention and employees receive training in this area. Compliance with the guidelines is monitored as part of an annual survey at all Geberit Group companies. The Internal Audit Department conducts additional on-site audits. In the event of misconduct, corrective measures are taken. For further information about the compliance system, see GRI 419.

OPERATIONS SUBJECTED TO REVIEWS ON THE RISK OF CORRUPTION (GRI 205-1)

An annual survey is carried out at all Geberit Group companies to identify incidents of corruption. The topic of corruption is also a component of the audit programme for the periodic inspections of the production plants, sales and management companies by the Internal Audit Department. The annual audit planning of the Internal Audit Department is oriented to risks. Each company is audited at least every five years, or considerably more frequently if it has a high risk profile. In 2018, the Internal Audit Department audited a total of 27 companies.

COMMUNICATION AND TRAINING ON ANTI-CORRUPTION (GRI 205-2)

All new employees at Geberit are trained on the Code of Conduct as part of the Welcome events, with specific training films on the topics of corruption, IT misuse, workplace bullying and sexual harassment deployed especially for this. All employees are also provided with information via the intranet about what is permitted and what is not. Guidance on the correct handling of donations (i.e. anti-corruption guidelines) were updated in 2015 and made accessible to the relevant employees (Purchasing, Sales) via the various communication channels.

INCIDENTS OF CORRUPTION (GRI 205-3)

According to the annual survey carried out at all Geberit Group companies and the audits conducted by the Internal Audit Department, there were no cases of corruption in 2018.

MANAGEMENT APPROACH ANTI-COMPETITIVE BEHAVIOUR

The prevention of anti-competitive behaviour is a matter of priority for Geberit. Cartels of any kind and other anti-competitive behaviour are categorically rejected.

E-learning courses represent an efficient way to train staff on antitrust legislation, an issue that is particularly sensitive for Geberit. A training event on antitrust legislation was held in the Polish market. Antitrust legislation audits were carried out by the legal department in cooperation with the Internal Audit Department in the Adriatic sales region as well as in Finland, Norway and Switzerland in the reporting year. No significant breaches were revealed.

LEGAL PROCEEDINGS DUE TO ANTI-COMPETITIVE BEHAVIOUR (GRI 206-1)

The proceedings with the Swedish competition authorities, which have been ongoing since 2015, were discontinued in early June 2018. There was no evidence of anti-competitive behaviour or the disclosure of sensitive information by the Geberit company.

The appeal proceedings mentioned in last year’s report from the former “bathroom antitrust proceedings” were concluded in 2018 with a ruling against Geberit. The resulting fine has already been paid.

Based on the annual survey of all Geberit Group companies, there were no other proceedings due to unlawful conduct.

MANAGEMENT APPROACH REGIONAL EMPLOYER

Geberit has grown from a family-run firm into a listed global company that has proven its ability to adapt to a rapidly changing environment. Within its core strategy (see GRI 201) Geberit’s aim is to ensure that sales companies, production plants, logistics and management companies function well as units which enjoy a high degree of autonomy. A high level of acceptance among the local workforce is a fundamental part of this, thanks in part to an attractive pay structure and the involvement of local know-how at the management level.

RATIO OF STANDARD ENTRY LEVEL WAGE COMPARED TO LOCAL MINIMUM WAGE (GRI 202-1)

Geberit pays market-rate wages, taking into account local circumstances and laws. When selecting employees and determining their assignment in the company, Geberit attaches great importance to qualifications appropriate to the task description. In accordance with their qualifications, the majority of Geberit employees at the production sites and sales companies are paid well above the minimum wage range. Stability and a high level of motivation among employees are important to Geberit.

PROCEDURES FOR LOCAL HIRING OF MANAGEMENT (GRI 202-2)

Geberit has no personnel policy or employment practices providing for the preferential treatment of persons from local vicinities in connection with the hiring of members of management boards for the respective country organisations. However, Geberit would like to establish organisations at its production and sales sites that function on a local basis, which is why it often integrates locally appointed managers. For example, the sales companies in India and China are both headed by managing directors who have been recruited locally.

MANAGEMENT APPROACH INDIRECT ECONOMIC IMPACTS

Indirect economic impacts arise primarily due to positive side effects from direct economic action. With its innovative solutions for sanitary products, Geberit aims to achieve sustained improvement in the quality of people’s lives. The economy benefits from this in several respects: through the contribution to better sanitary standards, a durable, resource-efficient sanitary infrastructure, through know-how transfer in the sanitary industry, via impetus for the economy in regional economic areas, and through orders with suppliers. There is no management approach to indirect economic impacts in the narrower sense. Instead, the company works with the stakeholders concerned to identify the best solutions in each case.

For further information, see also GRI 201.

SIGNIFICANT INDIRECT ECONOMIC IMPACTS (GRI 203-2)

Geberit forms part of the value chain in the construction industry. It has significant indirect economic impacts downstream on the customer side at sanitary engineers, plumbers and end users, as well as upstream at suppliers and transport companies. Continuous investment in the production plants in Europe, China, India and the USA, as well as the logistics centre in Germany, will strengthen these individual economic areas.

Geberit know-how and products significantly reduce the burden on water and waste water systems. According to one model calculation, all dual-flush and flush-stop cisterns installed since 1998 have so far saved around 28,100 million cubic metres of water in comparison with traditional flushing systems. In 2018 alone, the water saved amounted to 2,880 million cubic metres. This is more than half of the annual consumption of all German households.

Geberit is committed to sustainable sanitary systems which, as elements in construction, help to shape the infrastructure as a whole. For example, Geberit actively worked on adapting the applicable standard for the dimensioning of waste water piping to smaller diameters. This is important so that the full functionality of the piping system is ensured even with lower quantities of waste water. Similar to its work in the field of waste water hydraulics, Geberit also played a major part in ensuring that topics such as sound insulation and fire protection, as well as hygiene in drinking water and sanitary facilities, have been developed to the benefit of the end user and laid down in standards and recommendations. In 2017, Geberit played a major role in the foundation of a new platform for the European sanitary industry – the European Bathroom Forum (EBF).

Geberit lends impetus to the sanitary industry with innovation and new products that are sold and implemented worldwide by wholesalers, plumbers and sanitary engineers. In 2018 alone, around 35,000 professionals were provided with training on Geberit products, tools and software tools at 29 Geberit information centres in Europe and overseas, see Business Report > Business and financial review > Financial Year 2018 > Customers.

Geberit employed 247 apprentices at the end of 2018 (previous year 235). The transfer rate to a permanent employment relationship was 89%. All apprentices are essentially required to work at several sites during their training. Experience abroad and the transfer of know-how are beneficial, especially for young employees.

The indirect economic impact on suppliers and transport companies is also significant. The Group’s cost of materials in 2018 amounted to CHF 920 million (previous year CHF 847 million). The Group has business relations with around 1,830 suppliers here. Geberit does not have its own transport fleet and therefore generates orders for external transport companies.

MANAGEMENT APPROACH CHILD LABOUR

Geberit’s exposure with respect to child labour is considered low because of its industry, business model and the countries in which business activities are carried out, its high level of vertical integration as well as its high quality requirements in the supply chain. Geberit commits itself to the protection of human rights in its Code of Conduct. Child labour is categorically rejected.

The basic principles set out in the Geberit Code of Conduct for Suppliers explicitly include compliance with the ILO core labour standards for the exclusion of child labour.

CASES OF CHILD LABOUR (GRI 408-1)

According to the annual Group-wide survey there were no cases of child labour revealed in 2018. There were likewise no such cases arising during the audits carried out at suppliers.

MANAGEMENT APPROACH FORCED OR COMPULSORY LABOUR

Geberit’s exposure with respect to forced or compulsory labour is considered low because of its industry, business model and the countries in which business activities are carried out, its high level of vertical integration as well as its high quality requirements. Geberit commits itself to the protection of human rights in its Code of Conduct. Forced or compulsory labour is categorically rejected.

The basic principles set out in the Geberit Code of Conduct for Suppliers explicitly include compliance with the ILO core labour standards for the exclusion of forced or compulsory labour.

CASES OF FORCED OR COMPULSORY LABOUR (GRI 409-1)

According to the annual Group-wide survey there were no cases of forced or compulsory labour revealed in 2018. There were likewise no such cases arising during the audits carried out at suppliers.

MANAGEMENT APPROACH HUMAN RIGHTS ASSESSMENT

The UN Guiding Principles on Business and Human Rights apply to the business activities of Geberit. Geberit is active across the world, including in regions posing a certain degree of risk with regard to the upholding of fundamental employee and human rights. However, all Geberit Group companies throughout the world are integrated in the Geberit Compliance System, which includes the upholding of fundamental employee protection and human rights. In addition, internal audits with compliance reviews take place at all companies of the Geberit Group, see also GRI 419.

ASSESSMENT OF OPERATIONS REGARDING HUMAN RIGHTS RISKS (GRI 412-1)

The upholding of human rights is subject to a survey at all Geberit Group companies each year as part of reporting on the Code of Conduct. The topic of human rights as part of compliance is also a component of the audit programme for the periodic inspections of the production, sales and management companies by the Internal Audit Department. In 2018, the Internal Audit Department audited a total of 27 companies. In the reporting year, no evidence of human rights violations was found during the various inspections.

EMPLOYEE TRAINING ON HUMAN RIGHTS (GRI 412-2)

All new employees at Geberit are trained on the Code of Conduct as part of the Welcome events, with specific training films on the topics of corruption, IT misuse, workplace bullying and sexual harassment deployed especially for this.

The subject of compliance is uniformly positioned throughout the Geberit Group. The joint Geberit intranet serves as an important basis for this, presenting and explaining the compliance organisation and Code of Conduct on a dedicated page. In parallel to this, management have been requested by means of a circular letter to ensure that all employees without intranet access receive the same information via a suitable channel.

HUMAN RIGHTS CRITERIA IN INVESTMENTS AND CONTRACT AGREEMENTS (GRI 412-3)

In 2018, there was no investment agreement in countries or areas that pose a special risk in terms of human rights violations. The Geberit Compliance System was extended to the companies of the former Sanitec in 2015 (only European sites).

Suppliers are fundamentally required by contractual agreement to comply with the special Geberit Code of Conduct for Suppliers that contains provisions for the protection of human rights.

MANAGEMENT APPROACH SOCIAL RESPONSIBILITY

Social responsibility is exercised both within the scope of long-term partnerships and programmes with partners and in the annual social projects that Geberit has been carrying out for over ten years. These projects exhibit a relationship to the topic of water and sanitary facilities, as well as to Geberit’s core competencies and corporate culture. Equally important is the aspect of personal and professional education. By getting actively involved in the social projects in developing regions, apprentices become familiar with other cultures and also acquire new social, linguistic and professional competencies. Furthermore, these social projects make a tangible contribution to the Sustainable Development Goals (SDGs) of the United Nations, which include giving all humans access to clean drinking water and basic sanitation by 2030. A review of what has been achieved is carried out on a regular basis.

INFRASTRUCTURE INVESTMENTS AND PROMOTED SERVICES (GRI 203-1)

Donations and financial contributions, including product donations, totalling CHF 4.1 million (previous year CHF 3.3 million) were made during the reporting year. In addition, Geberit employees contributed 1,380 hours of charitable work (previous year 2,280 hours). Geberit also supports facilities for disabled persons and long-term unemployed, where simple assembly and packaging work in the amount of around CHF 8.1 million was carried out in 2018 (previous year CHF 6.9 million).

The focus was on the following projects and partnerships in 2018:

• Implementation of a social project in Morocco with apprentices: eight Geberit apprentices and their two coaches renovated the sanitary facilities at several schools near Marrakesh in the autumn of 2018.
• The partnership with Helvetas on projects relating to clean drinking water and sanitary facilities, plus supporting the new Helvetas campaign for clean drinking water and latrines with a substantial contribution.
• Participation in the charitable organisation Swiss Water Partnership to promote international dialogue on the topic of water.
• Implementation of the project Change of Perspective, in which two Swiss plumbers travelled to Nepal and worked together with two Nepalese colleagues for one week. This project is set to continue in 2019.
• Newly launched skill-sharing programme that took two Geberit employees to Mozambique, where they shared their knowledge with future trainers in a Helvetas development project. A further skill-sharing duo travelled to Nepal to develop a simple process enabling the local manufacturers to check the quality of ceramic filters. These are used for treating raw water so that it can subsequently be used as drinking water.
• Various local initiatives and collection campaigns in China, India, the USA, Poland, the UK and Switzerland to round off the Geberit Group’s social engagement.