Lifco strives to operate in a positive and sustainable manner that contributes to society. Lifco’s main sustainability impact, and thus also opportunities and risks, is in the operations of the subsidiaries. The subsidiaries have a large degree of autonomy, and Lifco strives for minimal bureaucracy and simple processes. A fundamental requirement for Lifco’s decentralised structure is that the subsidiaries operate in accordance with Lifco’s ethical principles. The ethical principles are set forth in Lifco’s code of conduct, which all subsidiaries are required to follow and which covers the companies’ relationships with employees, customers, suppliers, society and shareholders. All new employees in the Lifco Group must be informed about the code within one month of starting work.
The code of conduct is based on the following international principles: the Universal Declaration of Human Rights, the United Nations Global Compact, the ILO Declaration on Fundamental Principles and Rights at Work and the OECD Guidelines for Multinational Enterprises. The code of conduct also includes Lifco’s core values: respect for others, openness and pragmatism.
In December 2016 Lifco joined the UN’s sustainability initiative, Global Compact. As a member, Lifco undertakes to actively implement the Global Compact’s ten principles for sustainable development in the four areas of human rights, labour standards, environment and anti-corruption. Lifco’s annual report constitutes its Communication on Progress report under the UNGC framework and will continue to be developed in coming years. Lifco’s policies on the four areas are presented below.
Lifco shall inform its suppliers of the company’s values and business principles. Lifco shall not engage in business relationships with suppliers that violate the applicable legislation, fail to uphold fundamental human rights and neglect environmental issues.
All Lifco employees shall have the right to freedom of association and Lifco shall respect the right of all trade union members to negotiate collectively. Employees are recruited and promoted exclusively on the basis of their work qualifications and without regard to race, religion, age, national origin, sex, sexual preference, political belief, trade union membership, marital status or disability that does not prevent the performance of the duties involved. Lifco does not tolerate any form of harassment or violence at the workplace. Forced labour and/or child labour are strictly forbidden in all operations of the company. Products from suppliers, their subcontractors or business partners which use child labour must not be accepted.
Lifco has undertaken to prevent or minimise and mitigate any harmful effects of the company’s operations or products on the environment. Lifco strives to reduce the company’s products environmental impact throughout their lifecycle.
Gifts, entertainment, remuneration and personal benefits may only be offered to outside parties if they are of small value and consistent with current practice. No gifts, entertainment or personal benefits may be offered if they conflict with the applicable legislation or current practice. Gifts which do not meet these criteria must be reported to management, which will decide what measures to take. None of Lifco’s employees should seek to obtain or accept gifts or benefits which could be thought to affect their business decisions. Gifts which could be thought to affect business decisions must be reported to the company’s management, which will decide how to handle the issue.
THE TEN PRINCIPLES OF THE UN GLOBAL COMPACT
Principle 1: Support and respect international human rights within the sphere of influence of companies
Principle 2: Make sure that they are not complicit in human rights abuses
Principle 3: Uphold the freedom of association and the recognition of the right to collective bargaining
Principle 4: Eliminate all forms of forced labour
Principle 5: Abolish child labour
Principle 6: Eliminate discrimination in recruitment and occupation
Principle 7: Support a precautionary approach to environmental risks
Principle 8: Undertake initiatives to promote environmental awareness
Principle 9: Encourage the development of environmentally friendly technologies
Principle 10: Work against corruption in all its forms, including extortion and bribery
Monitoring and results
Compliance with the code of conduct is monitored by each subsidiary through audits, discussions with suppliers and by other means. Any deviations are reported to Lifco’s senior management. In autumn 2016 monitoring of the code of conduct was included as part of the monthly reports submitted by the subsidiaries to Lifco to ensure that these issues are given priority and reported correctly. If a deviation is identified, Lifco’s senior management will contact the chief executive of the company concerned, who will be tasked with producing an action programme and reporting on progress to Lifco’s Board of Directors. No deviations were reported in 2016.
At 31 December 2016 Lifco had 3,627 (3,386) employees. The average number of employees in 2016 was 3,524 (3,369). During the year around 370 employees were added through acquisitions.
Eleven of the subsidiaries are certified under the ISO 14001 environmental management system and 29 are certified under the ISO 9001 quality management system. See page 77 for a full list of certifications.
The subsidiary companies Lövånger Elektronik AB, Modul-System HH AB, Rapid Granulator AB, Texor AB and Zetterströms Rostfria AB are engaged in environmentally hazardous activities pursuant to the Swedish Environmental Code, which means that they are regulated by the environment committee at the relevant local authorit
Sustainability activities in some of Lifco’s subsidiaries
Labour standards and human rights
Modul-System is one of the world’s leading suppliers of modular interiors and equipment for service vehicles that sells its products in more than 50 countries around the world through subsidiaries and a global network of business partners. Modul-System works strategically on monitoring quality and sustainability issues at the supplier stage, in China and other countries. The company conducts audits of strategic suppliers and in some cases also of subcontractors to ensure that they comply with Lifco’s code of conduct with regard to labour standards, human rights and other issues. In 2016 eight audits were conducted and no deviations from Lifco’s code of conduct were observed.
Lövånger Elektronik AB (Leab) is one of Sweden’s leading contract manufacturers of electronics. The company has taken a focused approach to reducing its environmental impact through continuous improvement and has been ISO 14001-certified since 2001. The company’s environmental activities are guided by Lifco’s code of conduct and Leab’s own environmental policy, and by environmental targets that are defined on an annual basis. For example, in 2016 Leab worked to replace at least five chemicals with greener alternatives. It is also working continually to reduce the share of hazardous waste in the total volume of waste. In 2014 Leab switched from the use of oil-fired boilers for heating to purchasing renewable electricity, which has resulted in a slightly higher heating cost but has significantly reduced the company’s carbon footprint. In 2016 Leab continued its efforts to map energy use. It is also working to reuse waste heat from the processes used for heating the factory.
As one of the world’s leading manufacturers of remote-controlled demolition machines, Brokk has customers across the world, including in Russia, China and India. The company’s products are sold by its own sales staff and through partners in the sales markets. Brook works continuously to inform its staff and distributors about Lifco’s code of conduct. In 2016 an initiative aimed at mapping corruption risks at Brokk was initiated in order to strengthen the company’s anti-corruption work. The developed monitoring processes are planned to be implemented in the coming year.
Lifco strives to conduct its business in a way that makes a positive and sustainable contribution to the society in which the company operates. For example, in 2016 DAB Dental and Directa, two of Lifco’s subsidiaries in the dental industry, arranged two cost-free training days for dentists that have received their education outside the EU/EEA and therefore need to take the knowledge test arranged by the Swedish National Board of Health and Welfare to be able to work as dentists in Sweden. By taking part in the training days, the foreign dentists, most of whom are from Syria and eastern Europe, improve their chances of passing the knowledge text and obtaining their Swedish dentist’s licences.