Change

Integrity management


Enhancing the compliance framework

We have defined our compliance framework based on the AkzoNobel value “Integrity and responsibility in our actions”. This has resulted in company-wide awareness on compliance, clear norms set in the Code of Conduct and Compliance Policies, implementation of the Compliance function within the businesses and clear monitoring and reporting lines. In 2010 the different elements were further enhanced.

Underlying principle

Underlying the compliance framework is the Code of Conduct, which contains a summary of the key elements of our compliance norms for the company and for each employee. Communication on the Code of Conduct for new employees starts at the time they join AkzoNobel and includes online or classroom training; for current employees the Code of Conduct is also discussed at the year-end performance and development review with their manager. For employees who have access to share price-sensitive information, AkzoNobel has a specific Code for Insider Trading, which provides guidance on allowable trading in AkzoNobel securities.

A core element of the framework is the AkzoNobel complaints procedure, which operates under the name Speak Up! The Speak Up! procedure encourages employees to address their concerns with their managers. If employees do not feel able to report within hierarchical lines, they may use the Speak Up! hotline or the internet to report their concerns directly into the Corporate Compliance Committee. Finally, the compliance framework includes (online) training programs and monitoring tools, and is overseen by the AkzoNobel Compliance Committee as described in the Managing our values section. By the end of 2010 we had invited nearly 41,000 employees to complete the online Code of Conduct training module. Completion rates are monitored monthly and business units are committed to having new employees trained within three months of that invitation.

Key performance indicators - integrity

 

 

 

 

 

 

2008

2009

2010

2010 ambitions

 

 

 

 

 

Code of Conduct trained (% online employees)

31

~95

95

100

Competition law certification

 

10,000

13,000

 

Specific compliance areas

Within the compliance framework, specific compliance areas are addressed by specific programs. These include, among others, programs for competition law, anti-bribery regulations, privacy and trade secrets. Each of these topics is supported by online training and a declaration program. These programs can be supplemented with face-to-face training during annual conferences for some functions. For example, employees who have contacts with third parties (e.g. in sales or procurement) or have management positions, are called to complete online training in competition law. To close the loop, these employees complete an annual declaration confirming their adherence to the AkzoNobel standard on competition law: in 2010, almost 13,000 employees signed this declaration. In addition, each operational manager confirms adherence to the AkzoNobel standards during the annual non-financial Letter of Representation process (NFL). This provides evidence for the Statement of the Board of Management in this 2010 Report.

Communication

Communication is an essential part of an effective compliance framework. During regular meetings with business Compliance Officers, we have open dialog to support them to maintain an effective compliance framework within each business unit, and to ensure that the AkzoNobel compliance initiatives address the relevant issues within each of the business units.

Complaints procedure (Speak Up!)

In 2010 we dealt with 23 cases which were handled at the level of the Compliance Committee (2009: 19). Of these, 14 were substantiated and five are still under review. Company-wide we had 115 dismissals on grounds related to breaches of the Code of Conduct (2009: 66). While none of the issues reported has been material for AkzoNobel in total, we continue to analyze the root causes and take appropriate action. This has already resulted in specific issues addressed in our NFL process and resulted in adaption of our online training programs.

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