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UN Global Compact Communication on Progress

SFS remains active in other areas as well. It is a signatory to the UN Global Compact and has upheld these principles since 2010. The progress during the year under review is described below:

Sustainable Development Goals (SDGs)

SDGs 2020

In this context, SFS also supports the achievement of the Sustainable Development Goals (SDGs). The organization also contributes to the realization of the Sustainable Development Goals (SDGs) and currently prioritizes four goals: SDG 4 – Quality education, SDG 8 – Decent work and economic growth, SDG 12 – Responsible consumption and production, SDG 13 – Climate action. This prioritization reflects the material topics as determined in the materiality assessment conducted in 2019: economic performance, occupational health and safety, training and education, reduction in emissions, and socioeconomic compliance. SFS reports annually on the goals, measures and progress with respect to the individual topics within the framework of the “Communication on Progress Report” (UN Global Compact) and the GRI report (Core option). During the year under review, we focused on achieving improvements in these areas and in particular on making an important contribution to the global SDGs through achievement of our goals.

Human Rights

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Previous initiatives continued
The SFS Corporate Principles and the SFS Code of Conduct are key documents that shape SFS’ sustainability policies and ensure that all its business dealings respect and protect human rights. The Corporate Principles set out our common values, while the Code of Conduct defines the basic rules by which we conduct our business activities. Both documents remain binding. The Code of Conduct is based on robust and effective compliance processes. The contents of our Corporate Principles and Code of Conduct are imparted to all new employees and apprentices through formal instruction or e-learning units when they join the company. Awareness of these themes is part of the basic skillset every SFS employee must have, and this awareness should guide and shape them from the start (→ see GRI 102-16).

SFS also strives to introduce the Code of Conduct as quickly as possible to all new employees who join SFS Group through acquisition activity. The Code of Conduct is therefore an integral element of every integration process. SFS also demands unconditional respect for basic human rights from its suppliers. When screening potential business partners, this requirement is a mandatory criterion, as it is an integral part of SFS’ general purchasing conditions (→ see GRI 102-9) and no business is conducted with a supplier that does not sign and comply with them. Our efforts of recent years in the areas of data protection and compliance with international trade regulations were maintained during the year under review. The implementation of legally compliant Group-wide standards at all Group companies was intensified and monitored. Responsibility was transferred to the site managers and those involved in the process at the individual sites were closely supported and trained by Group specialists. SFS observes and promotes the international rule of law by fully complying with all laws and regulations, and by providing its employees and business partners with detailed information about their scope and implications. Thanks to the goods classes activated in the ERP system in 2020, compliance with a temporary export ban on certain hygiene and respiratory protection articles to non-EU countries was quickly ensured from a technical standpoint. In addition, compliance with sanctions lists was further automated and technically simplified at the end of the year, thus facilitating the screening of critical business partners at an early stage.

SFS’ general purchasing conditions were revised in 2020 and emphasis was given to the integration of compliance issues to ensure adherence to applicable laws and regulations throughout the supply chain.

Priorities 2021
After revision of the general purchasing conditions in 2020, the “Supplier Quality Agreement” will be updated in 2021. Compliance and sustainability issues are also an integral part of this standard contract, and this update is intended to ensure compliance with the relevant standards throughout the supply chain.

In order to strengthen awareness of the principles of the Code of Conduct among new employees, this issue will be a prominent component of new further-reaching onboarding courses that we plan for new employees about 100 days after the start of their employment.

Labor standards

Promoting conflict-free collaboration
SFS strongly condemns forced labor and child labor of any kind whatsoever, and upholds the right to freedom of association and collective bargaining throughout the organization. As these principles are an integral part of the Group’s general conditions of purchase, compliance with which is mandatory in order to qualify as a supplier, SFS suppliers are similarly required to uphold these values (→ see GRI 102-9).

The diversity of SFS’ workforce is a natural outcome of the company’s international presence and size and this diversity is regarded as positive and enriching. Recurring multi-week internships completed by SFS apprentices at different sites and international management training programs that promote intercultural collaboration are examples of how SFS champions diversity.

All forms of discrimination during the recruitment process or in employment are expressly prohibited. In the year under review, the right to/respect for bodily integrity became a fixed component of management training programs. Awareness-raising initiatives were launched at various local organizations during the year under review; for example, a YouTube video on the topic of sexual harassment was very well received within SFS Group as a training tool.

Priorities 2021
Activities promoting the right to bodily integrity will continue in 2021. All employees will complete an online course on bodily integrity in order to ensure that awareness of this issue remains high.

Protecting the environment

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Ambitious goals set
As a leading technology-driven company, SFS is constantly working to make its processes as energy-efficient, environmentally sound and resource-efficient as possible. In doing so, it aims for continuous improvement of all processes relevant to energy and the environment. One focus of the company’s sustainability-related targets is climate protection and, in particular, on reducing CO2 emissions by 90% or more by 2030 (measured as tonne of CO2 per Swiss franc of value added).

One of the overarching goals for 2020 was to establish a Group-wide master plan and roadmap focusing on reducing emissions and improving SFS’ environmental performance. These documents will serve as a basis for further developments at the divisional level. The central element of the master plan concerns identification of key figures and evaluation of programs in conjunction with an opportunity assessment and subsequent definition of specific targets and measures. The opportunity assessment entails two elements. In the first, we look at best practices that have already been implemented within the organization and how they can be rolled out to other sites. These may include technical projects (such as the replacement of old furnaces and boilers) or awareness campaigns (e.g. “Think before you print”) that raise global employee awareness of the issue of sustainability and contribute to holistic integration. The second element entails a lean-green approach (to eliminate uneconomical and unsustainable processes), which we use to review current processes in terms of efficiency and sustainability in order to identify and implement opportunities for improvement. In 2020, for example, a new photovoltaic system was installed at the main site in Heerbrugg (Switzerland), which, together with the previous system, has produced about 8.5% of the energy required for SFS’ activities in Switzerland since spring 2021.

ISO14001 certification of further sites
ISO-14001 certification serves as the basis for SFS’ sustainable corporate development in an environmental sense. Our goal is to have all our production sites certified by 2025 at the latest: 20 sites are already certified to ISO 14001 (2019: 15). Twelve of the 13 sites in the Automotive division are certified. In the Construction division, certification audits will be conducted at all six sites in 2022. The Electronics division’s two sites in Malaysia and China are already certified. In the Industrial division, of the five sites in our Scope (*), four have been certified; the fifth site is scheduled to be audited for certification purposes in 2022. The Riveting division plans to complete its ISO 14001 certification process during the course of the financial year 2022; all the sites in the Medical division will be certified by 2023. Since the Services division and D&L segment do not have any production activities of their own, they are not included in this Scope.

Division Automotive Electronics Industrial Medical Construction Riveting
SFS Scope* 13 2 5 4 6 4
Certified 12 2 4 0 0 2
Open 1 0 1 4 6 2
100% planned by 2021 - 2022 2023 2022 2022

* SFS Scope: production sites in which SFS owns an interest of ≥50% and which employ more than 50 workers.

Initiatives to protect the environment
In 2020, the launched initiatives in Switzerland such as the EcoPoints program in which employees can earn points for using environmentally friendly vehicles, were continued. New action taken during the reporting period included the modernization of the heating system in Leeds (UK), which led to an approximately 80% reduction in its natural gas consumption. LED lighting concepts were implemented at many sites, reducing the electricity consumption by up to 80% (Wyomissing, US). In Strängnäs (Sweden) in early 2020, we switched to utilities that generate energy exclusively from solar, wind and hydropower sources. The site in Italy reduced its carbon emissions by 460 tonnes by replacing air conditioning systems with small exhaust gas extraction systems, which also lowered its energy costs by about EUR 100,000.

In Switzerland, chip presses were installed last year for machining purposes, cutting forklift travel time and allowing oil used in the manufacturing process to be recycled. The annual number of forklift trips to transport chips was reduced from 1,200 to 100. The higher grade purity has increased the scrap value and use of the recycled oil saves a considerable amount of CO2 emissions and costs.

Priorities for 2021
After conduct of the planned opportunity assessments at the production sites, the main focus in 2021 will be on implementing the initial quick and easy measures, such as purchasing electricity generated from renewable energy sources, installing solar panels and inspecting air compressor/vacuum systems. For the remainder of 2021, the divisions and production sites will develop their own roadmaps to bring the Group closer to its goals and further its sustainable corporate development.

Corruption prevention

No corruption cases in the year under review
The anti-corruption policy in force at SFS since 2016 and imparted to staff in high-risk positions via mandatory e-learning courses was again communicated to all new employees in management positions and in the sales, procurement and finance units during the year under review.

We are pleased that once again no suspected or verified cases of corruption were reported throughout SFS Group in 2020. Numerous requests from staff seeking guidance on specific, potentially critical situations are an indication that awareness of corruption, including blackmail, has continued to grow. The internal Code of Conduct is also increasingly referred to in dealings with business partners; for example, refusal of certain invitations to certain events. SFS also expects third-party business partners, and their sales agents in particular, to take a zero-tolerance approach to all forms of corruption. A standard clause to this effect is included in cooperation agreements with sales agents. SFS’ general purchasing conditions also require suppliers to take action against corruption and bribery (→ see GRI 102-9).

In 2020, all employees in management positions and the sales, procurement and finance units completed another e-learning course on the topic of corruption.

Priorities 2021
We will continue to devote considerable attention to our anti-corruption drive in 2021. As in previous years, critical questions related to gifts, invitations and events will be addressed in newsletters and through other channels, in particular before holiday periods. This will ensure that employees and other stakeholders are constantly aware of this important topic and can help to ensure fair competitive practices.