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Responding department: Corporate Social Responsbility

Stock exchange symbol: (BN:FP)

Does your company have a publicly available commitment to respect human rights?

Yes.  The Business Conduct Policy is applicable to every company controlled by Danone and to every country where the Group is located. The Policy expresses the Group’s and the employees’ commitments. The Policy document specifies that its principles adhere to the Universal Declaration of Human Rights, International Labour Organization (ILO) Conventions and OECD Guidelines for Multinational Enterprises, and to commitments that the Group has made within the context of the Global Compact.

The first commitment made to employees in the Business Conduct Policy is as follows:

“The Group undertakes to comply with all of the agreements entered into between Danone and the IUF and, primarily, the Fundamental Social Principles contained in the ILO Conventions relating, in particular, to:

  • child labour
  • forced labour
  • non-discrimination
  • freedom of association and collective bargaining rights
  • health and safety at work
  • working hours
  • remuneration

Web-link for this policy commitment: [link]  

Moreover, Danone makes it compulsory for its suppliers to sign up to the Sustainable Development Principles (social, environmental and ethical) when entering into contracts or signing the general terms of procurement.

Some excerpts from the Fundamental Social Principles are given below:

"Fundamental Social Principles

1 CHILD LABOUR

The company does not employ children aged under 15.

If the law sets a higher minimum working age or compulsory schooling is to a higher age, it is this limit that applies.

Educational programs and training are not included in this limitation.

2 FORCED LABOUR

The company does not use forced or compulsory labour, meaning any work or service performed under threat or that is not consented to by the person concerned.

3 DISCRIMINATION

With due regard for applicable law, the company refuses to engage in any discriminatory practices.

Discrimination means any distinction, exclusion or preference limiting equality of opportunity or treatment.

It may be based on race, colour, sex, sexual orientation, religion, political opinion, age, nationality, family obligations or other considerations.

4 FREEDOM OF ASSOCIATION AND RIGHT TO COLLECTIVE BARGAINING

The company recognizes and respects employees’ freedom of association and their right to freely choose their representatives.

The company also recognizes employees’ right to collective bargaining.

The company ensures that employee representatives do not suffer any discrimination.

5 HEALTH CARE AND SAFETY AT WORK

The company ensures that the workplace and its environment do not endanger the physical integrity or health of employees.

Action to reduce the causes of accidents and improve working conditions is the object of ongoing programs.

Sanitary equipment, canteens and housing provided to employees are built and maintained in accordance with applicable legal requirements.

As a minimum, the company must provide employees with drinking water, clean toilets in adequate number, adequate ventilation, emergency exits, proper lighting and access to medical care.

6 WORKING HOURS

The company must ensure that national applicable legal restrictions on working hours, including overtime, are complied with.

Employees have at least one day off each week, apart from exceptional circumstances and for a limited period.

7 PAY

The company ensures that:

No wage is lower than the applicable legal minimum;

All employees receive a pay slip;

Employees receive a decent wage, as compared to standard pay practices in their country;

Wage rates for overtime are in all cases higher than for normal hours."

How are human rights governed in your company?

The Director of Organisation Development and Social Dynamics has the lead responsibility for human rights issues and for social issues.

The members of the Social Responsibility Committee oversee them (see pages 216 and 217 of the 2013 reference document). The committee consists of the following four members: Jean Laurent, Bruno Bonnell, Emmanuel Faber and Jean Michel Severino. Human rights considerations are entirely relevant to the company’s business model, given Danone’s dual economic and social project.

The Marseille speech is at the heart of our DNA. In 1972 in Marseille, Antoine Riboud explained his vision of a company’s role by stating that economic and social goals are interdependent. At the French employers' association (CNPF national conference he declared that “the role and responsibility of a business leader will be judged on two criteria: meeting business targets with shareholders and meeting targets for human and social progress for employees.”

Ever since, Danone has made this a condition for sustainable development. This visionary thinking provided the cornerstone for Danone’s dual economic and social project. To this day, our teams around the world imagine operating models that generate economic, social and environmental value. This is what makes Danone a unique company with “something special inside”. Still.

How are human rights managed within your company?

Within Danone, the Group’s human rights commitments are communicated to all employees in accordance with the Business Conduct Policy. An additional document entitled “Danone Inside Pack” was put together to better explain to employees what is expected of them, It specifically refers to the Business Conduct Policy principles within the context of Danone’s values, mission, history and its dual economic and social project. Compliance with them is ensured through the implementation of the Danone Way, which functions as an internal point of control.

Launched in 2001, the Danone Way approach allows the culture and fundamentals of sustainable development to be disseminated throughout the company by measuring the social and environmental responsibility performance of its subsidiaries.

Every year, the Group’s subsidiaries assess the maturity of their policies and levels of performance according to 16 “key practices” divided into five topics: human rights, human relations, the environment, consumers and governance.

The human rights topic covers forced labour, child labour, diversity, health, safety and working conditions, whereas the human relations topic covers social dialogue, working hours and organisation, personal development and training.

In order to demonstrate the objectivity of the Danone Way approach and the reliability of its results in relation to all of the Group’s stakeholders, it was audited in 2002 by an independent external body (since 2007 the auditing company KPMG).

The assessments of eight subsidiaries, accounting for 16.7% of the consolidated turnover of the entities participating in the Danone Way, were audited by KPMG between November 2013 and January 2014. Coupled with its review of the method for consolidating the subsidiaries’ results as a whole, KPMG certified the results in the Danone Way 2013 report (moderate level of assurance).

The notice was published on pages 160 and 161 of the Sustainability Report.

In 2013, results improved the most in Human Rights and Governance due to:

  • progress made by subsidiaries in addressing working conditions issues, in accordance with the principles defined in the 2011 convention between Danone and the IUF on health, safety, working conditions and stress;
  • greater ownership by subsidiaries of the Social Responsibility principles vis-à-vis Danone’s suppliers through the RESPECT programme, particularly in the Early life and Medical nutrition divisions

Regarding safety at work, which is an absolute priority for the Danone Group, means, methods and audits have been put in place and carried out.

In addition to ensuring that Danone’s social principles are managed and respected by the subsidiaries, ongoing dialogue with the IUF leads Danone to make new commitments.

Listed below are the conventions signed with the IUF since 1988, which are increasingly integrated into the Danone Way approach for application.

In order to verify the application of these conventions, joint audits may be undertaken by Danone and the IUF in the subsidiaries.

1988 - Convention #1 Danone – IUF: Common view with the IUF

1989 - Convention #2 Danone - IUF on economic and social data in group Danone companies

1989 - Convention #3 Danone – IUF for the promotion of equality of men and women in the workplace

1992 - Convention #4 Danone - IUF on skills training

1994 - Convention #5 Danone - IUF on trade union rights

1997 - Convention #6 Danone - IUF in the event of changes in business activities affecting employment or working conditions

2005 - Convention #7 Danone - IUF on the setting up of social indicators at group level

2007 - Convention #8 Danone - IUF on diversity

2011 - Convention #9 Danone - IUF on health, safety, working conditions and stress

Regarding its Supply Chain, Danone applies its RESPECT programme to its suppliers.

The RESPECT programme launched in 2005 extends the “dual economic and social project” to the Group’s entire supply chain, except milk producers, following a specific process:

  • including the Sustainable Development Principles (social, environmental and ethical) in supplier contracts and/or general terms of procurement. By signing up to them, our commercial partners are aware of the importance that Danone places on human rights;
  • sharing information through supplier self-declarations concerning their CSR performance, using the SEDEX platform shared by all consumer goods industry players in the AIM-progress association (see this link for more information: [link]);
  • external CSR audits using the SMETA benchmark for suppliers viewed as at-risk based on this information exchange, with a view to implementing an appropriate action plan (see diagram and this link for more information on the framework: [link]).

In 2013, suppliers’ self-assessments of CSR performance at their sites continued to rise, and 430 new sites were recorded out of a total 3,501. In total, this represents 81% of the 4,300 supplier sites targeted by this policy around the world due to the scope of their relationship with the Group and the nature of their products and/or services: raw materials (except milk), packaging, logistics, promotional products and other services.

Based on the self-assessments of these 3,501 sites, 62 new sites underwent SMETA audits administered by external auditors (in addition to the 260 sites audited since 2010 at Danone's request). These audits either confirm or rule out the risks identified during the SEDEX pre-analysis, and lead to the introduction of action plans where required.

The table below shows the breakdown of instances of non-compliance identified in 272 audits of Danone suppliers carried out in 2013, the results of which were made available on the SEDEX platform.

- Health, safety and hygiene 47%

- Working hours 13%

- Management systems 10%

- Environment 10%

- Wages 9%

- Work contract 3%

- Ethical practices 3%

- Freedom of association 2%

- Child labour and young workers 1%

- Discrimination 1%

- Housing conditions <1%

- Complaints management <1%

- Forced labour <1%

Health, Safety and Hygiene continues to account for almost half of the instances of non-compliance. Meanwhile, Management Systems, reflecting the ability of the company to structure its CSR practices with information systems and procedures, is increasingly mentioned in audits. Items relating to child labour and forced labour, which are priority issues for the Group, remain at very low levels. It should be noted that, irrespectively of the audits, any cause for concern regarding either of these two topics leads to an immediate demand by Danone for corrective action by the supplier as soon as it is flagged in the SEDEX self-assessment.

What is the company’s approach to the engagement of stakeholders (including workers, and local communities impacted by the company’s activities), on human rights issues?

Danone believes and engages in considerable dialogue with its stakeholders.

The creation of shared value by involving local communities stands as of the 16 Danone Way principles. Through this policy, the Group encourages subsidiaries to identify, in conjunction with these stakeholders, their main sustainable development issues (including human rights issues), to establish a strategy that takes these issues into account, and to initiate projects with these stakeholders.

This is also one of the major principles of the Danone Ecosystem Fund, which both co-builds local socio-economic capacities through partnerships that strengthen the Danone ecosystem and contributes to the general interest. The fund was endowed with €100 million in 2009 and covers 21 countries, with 48 active projects directly benefiting 47,000 people jointly undertaken with 38 NGO partners.

The project selection and performance measurement criteria are:

Job creation

Revenue generation

Skills development

Health

Territorial development

Empowerment of women

Environment

Finally, the Group has implemented a whistle blowing system (DIALERT) communicated via a display system in subsidiaries and factories. It can be accessed by all employees and suppliers. A fax / phone / Internet line is available in seven languages and allows anyone to report any practices in breach of the Business Conduct Policy, such as human rights violations, discrimination and so on.

Priority human rights issues: What are some of the priority human rights issues for your company?

  • Health (including workplace health & safety, prevention of pollution)
  • Workplace diversity / non-discrimination
  • Forced labour and human trafficking (including in supply chains)
  • Freedom of association and trade union rights
  • Access to water
  • Children (including child labour)

Actions on health

WISE Programme:

With 190 factories across the globe and more than 400 sites, employee safety is one of the priorities on the agenda. Since 2004, the Group has implemented a programme based on participatory methods. The WISE programme therefore involves employees in striving to attain the objective of considerably raising awareness of safety issues and of reducing accidents at work. Within the past 10 years, this sense of ownership has enabled the Group to reduce the number of accidents at work resulting in time off by nearly 80%.

Dan’Cares Programme:

Sixty percent of Danone’s employees live in developing countries where public healthcare systems are often poor. As health within the company is a major issue for the Group, in late 2009 Danone launched the Dan’Cares programme to provide all of its employees across the globe with healthcare cover.  By late 2013, nearly 70,000 of the Group’s employees benefitted from basic healthcare cover. This marks significant social advancement for Danone, making it more attractive and enhancing its employees’ engagement.

Actions on access to water

Because it relies on water, it is crucial for Danone to protect sources and respect nature’s cycles. Hence, Danone has always made sure that it does not take more water than nature is able to replace, and it systematically assesses the quality of water put back into circulation after use. Moreover, Danone has refined a new method called “SPRING”, developed in partnership with the IUCN and the Ramsar convention. Its aim is to manage local water resources and it will be implemented at 100% of the company’s sites and made available to other users. One of the criteria of this assessment is access to water.

In addition, Danone Communities, an investment fund established to support the development of social business, has a positive impact on reducing poverty and malnutrition. It now manages three access-to-water projects: 1001 fontaines, Naandi Community Water Services and EcoAlberto. See www.danonecommunities.com for details of each of these projects.

How are human rights commitments and information about how the company addresses its human rights impacts communicated, internally and externally?

Danone communicates its governance, objectives and results in its Sustainability Report, which includes the GRI.  Danone also responds to the DJSI and Vigeo surveys annually, and tries to respond to most of the questionnaires it receives from various civil society agents.

Internally, the Business Conduct Policy and the Danone Way programme inform employees and subsidiaries about fundamentals, best practices and recommendations on forced labour, child labour, diversity, health, safety and working conditions, while human relations covers social dialogue, working hours and organisation, personal development and training.

What provisions does your company have in place to ensure that grievances from workers and affected communities or individuals are heard, and can you provide examples of remedies provided?

The Group has implemented a whistle blowing system (DIALERT) communicated via a display system in subsidiaries and factories. It can be accessed by all employees and suppliers. A fax / phone / Internet line is available in seven languages and allows anyone to report any practices in breach of the Business Conduct Policy, such as human rights violations, discrimination and so on.

Which external and collaborative human rights initiatives does your company participate in, and what is the nature of your involvement?

Danone is a signatory to the United Nations Global Compact.