RESPONSIBILITY REPORT - International Post Corporation
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CONTENTS Business ethics OUR 7 p. COMMITMENT This Responsibility Report is a Communication on Progress (COP) of the DSV Group under the United Nations Global Compact, which DSV signed in 2009. Employees The Responsibility Report gives information and data on the responsibility activities and working of the Parent and of subsidiaries of the DSV Group in which the Parent has an environment ownership interest of more than 50%. 10 p. The Responsibility Report covers the twelve-month period, ended 31 December 2018. This Responsibility Report is a part of management’s review and covers the statutory reporting on corporate social responsibility and the gender composition of senior management as prescribed by sections 99a and 99b of the Danish Financial Statements Act. Further, this report serves as DSV’s statement according to section 54, part 6 of the UK Modern Slavery Act. With this progress report, we would like to express our continued support to the United Nations Global Compact initiative and its ten fundamental principles as well as its efforts to achieve the Sustainability Development Goals. Letter from the CEO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Environment We also encourage all our partners to support the Global Compact initiative. and climate DSV at a glance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Our approach to Responsibility . . . . . . . . . . . . . . . . . . . . . 5 Business ethics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 15 p. Employees and working environment . . . . . . . . . . . . . . 10 Environment and climate . . . . . . . . . . . . . . . . . . . . . . . . . . 15 Suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 Community engagement . . . . . . . . . . . . . . . . . . . . . . . . . . 23 Suppliers WE SUPPORT 20 Non-financial highlights of the DSV Group . . . . . . . . . 26 Global Reporting Initiative (GRI) index . . . . . . . . . . . . 29 p.
3 DSV Responsibility Report 2018 Letter from the CEO SUSTAINABILITY IS A COLLECTIVE RESPONSIBILITY As a global transport and logistics provider, This involves regular updates to the DSV DSV facilitates global trade to support eco- Code of Conduct, which will be published in nomic growth. We employ more than 45,000 a new version in the beginning of 2019. people, and our international network counts more than 200,000 suppliers all over the Employees will subsequently be trained in world. In other words, we interact with the the contents: if we practice what we preach, world, and the world interacts with us. we lead by example and can lead the way in our interactions with our stakeholders. Global impact carries great responsibility, and we take that responsibility seriously. We MAKING ENVIRONMENTALLY recognise that we must act as leaders and CONSCIOUS DECISIONS set high standards for ethical and responsi- We have a responsibility to keep talking ble behaviour. We expect our partners to do about the industry’s environmental impact. with emergency relief support and contin- ciples of UN’s Global Compact and to sup- the same, because together we make up In our daily dialogue with customers and ued our support to Red Cross | Red Cres- porting UN’s Sustainable Development links in the same chain. suppliers, we must push for environmentally cent development projects in some of the Goals. These initiatives are supported conscious decisions when choosing routes most vulnerable parts of the world. worldwide by thousands of companies, To ensure that our partners operate accord- and transport modes. institutions and states. ing to the same standards as DSV, we will This global partnership is also a local part- devote even more attention to improving To provide a solid foundation for choosing a nership, where DSV companies engage with We cannot make lasting, global changes our supplier screening processes in 2019. sustainable solution, we will work to increase local Red Cross | Red Crescent organisations without global consensus, global legislation transparency and accuracy in the carbon wherever our help is needed. and global efforts. The world is a shared LEADING THE WAY emission reports we provide to suppliers space, and we must adopt a collective ap- First and foremost, of course, it is essential and customers in 2019. WE CAN DO MORE TOGETHER proach to sustainability and responsibility. that all DSV employees act according to the While DSV is a significant global player, we same ethical standards. CREATING VALUE BEYOND are only one company, in one industry. We FINANCIAL RESULTS cannot improve the world single-handedly. We must continously inform our employees To extend our responsibility beyond our Because we can do so much more together, of our DSV Code of Conduct and train them business activities, we have a global part- we are strong believers in partnerships and accordingly to demonstrate ethical behaviour nership with Red Cross | Red Crescent. In in joining forces. That is part of the reason Jens Bjørn Andersen when conducting DSV business. 2018, we strengthened this partnership why DSV is firmly committed to the prin CEO
4 DSV Responsibility Report 2018 DSV at a glance DSV AT SUPPORTING OUR CUSTOMERS A GLANCE SUPPLY CHAINS KEY RESOURCES AND PERFORMANCE DRIVERS People — IT systems — Global network with local presence — Standardised global workflow Carrier relations — Industry knowhow From Shipper A Shipment booking Cargo consolidation Pick-up FREIGHT FORWARDING Purchase order management Warehouse SERVICES Cross-dock terminal Documentation & customs clearance Insurance FREIGHT FORWARDING AND ONE OF THE BIG FIVE VALUE-ADDED SERVICES DSV was founded in Denmark in 1976 and TRANSPORT DSV is a global freight forwarder offering has since then evolved to become the (SUBCONTRACTED) transport and logistics services supporting world’s fifth largest freight forwarder gen- our customers’ entire supply chain. We pro- erating total revenue of DKK 79,053 million vide traditional transportation of goods as in 2018 and with a skilled workforce of well as a variety of value-added services. more than 45,000 employees. Warehouse Labelling, configuration, testing Picking/packing LOGISTICS AND Distribution DISTRIBUTION Cross-dock terminal Documentation & customs clearance Value-added services include purchase or- ASSET-LIGHT BUSINESS MODEL SERVICES Deconsolidation E-commerce fulfilment der management, cargo consolidation, cus- DSV is an asset-light freight forwarder. As toms clearance, cargo insurance, warehous- such, we plan and coordinate transportation ing, distribution and other related services. from shipper to consignee as illustrated in the business model to the right. The physical Our services are offered through our three divisions – Air & Sea, Road and Solutions – transport is outsourced to suppliers – air- lines, shipping lines, haulage companies etc. B delivering a full range of transport and logis- To Consignee tics solutions throughout the more than 75 The value we add and the services we offer countries in which we operate. as freight forwarders are therefore based on the skills and industry knowhow of our SUPPLY CHAIN VISIBILITY employees, our specialised and integrated IT Alerts —Exception management — Track and Trace — Proof of delivery — KPI reporting infrastructure, and our global network.
5 DSV Responsibility Report 2018 Our approach to Responsibility OUR APPROACH TO RESPONSIBILITY DSV is committed to being a responsible All SDGs are as such relevant to DSV, but and reliable business partner and an active some have more significance to and impact on participant in the global community. our business activities than others. By working systematically within the frame SPHERE OF INFLUENCE work of the United Nations Global Compact, we As we are freight forwarders and run our have dedicated ourselves to improving and re- business based on an asset-light business porting on matters of social responsibility that model, we do not control the transport are within reach of our core business activities. equipment that carries and delivers our ser- vices. We outsource the physical transport We have been committed to the UN Global to suppliers and as such the value we create Compact since 2009, and we continue to for our customers is through our logistics apply responsibility initiatives targeted at planning and network capabilities. changing and shaping practices that contrib- ute to improving sustainability and raising Therefore, applying the SDGs within our ethical standards within our line of business. sphere of influence mainly depends on our global network of offices, warehouses and Due to this commitment, we have, since terminals, which constitute the framework 2009, reported regularly on our progress on for the services we provide. the UN Global Compact’s ten principles of anti-corruption, environment, human rights Although we have a limited direct influence and labour. on the transports carried out by suppliers, we actively engage with suppliers and cus- By committing to the UN Global Compact, we tomers to create awareness and pursue apply the 17 UN Sustainable Development possibilities for establishing partnerships in Goals (SDG) as a framework for defining our order to address the SDGs. strategies and measuring our progress.
6 DSV Responsibility Report 2018 Our approach to Responsibility KEY RESPONSIBILITY FOCUS AREAS GOVERNANCE level and with the same urgency as our Based on our commitment to the UN Global The responsibility activities are anchored other key risks. Compact, the SDGs and our sphere of in with the Board of Directors, who, together fluence, DSV’s key strategic responsibility with the Executive Board, sets the direction This alignment means that responsibility is- areas are: for our responsibility strategy, targets and sues and risks are identified, assessed, and group policies. mitigated on an ongoing basis and used by • Environment and climate; the Board of Directors as basis for decision DSV’s Group CSR Department plans, man- making and development of our business • Business ethics; ages and follows up on ongoing global re- model in alignment with market- and stake- sponsibility activities throughout the organi- holder expectations. • Employees and working environment; sation in collaboration with the Executive Board. Identified risks and actions to mitigate are • Suppliers. described in the chapters of this report. Implementing and driving our responsibility These areas are highly relevant to our activi- strategies and initiatives ultimately rests OUTLOOK ties, and within these we can make a differ- with the management of our local sub If we look at responsibility trends within the ence and seek influence. By matching our key sidiaries. transport and logistics industry, we see an responsibility areas with the SDGs of great- increasing focus on conducting business in a est influence, we find that we can make the Ensuring compliance with our responsibility safe and responsible way throughout the greatest contributions to the following SDGs: policies is also a local matter due to our de- value chain. centralised structure and empowerment. Follow-ups are carried out by our Group It is our assessment that the most signifi- Controlling and CSR department, who con- cant responsibility trend that will continue to trol reported data and perform local “on impact our activities in the coming years is site” compliance reviews to ensure that the focus on developing logistics solutions DSV’s responsibility policies are followed, with a lower carbon footprint that also re- and related data is reported regularly. main cost-effective, as that is a dominant requirement from customers. Additionally, RISK MANAGEMENT we believe that conducting business in an Besides applying the SDGs as the basis for ethical manner and influencing our suppliers our strategic work and for achieving targets, to do the same will also attract significant we also apply the SDGs as a framework focus in the coming years. when we assess our responsibility risks in herent to our operations. These areas are closely linked to our key re- sponsibility areas and areas that have had Our responsibility risk management process and will continue to form a significant part is aligned with the main risk management of our responsibility efforts. process of DSV as described in the 2018 Annual Report to ensure that our responsi- bility related risks are addressed at the same
7 DSV Responsibility Report 2018 Business ethics DSV wants to conduct business in an ethical and responsible manner, no matter where in the world we do business. It is essential that our employees share the same ethics when operating across different cultures all over the world. BUSINESS ETHICS
8 DSV Responsibility Report 2018 Business ethics Our behaviour is defined by the fundamental revision process, we pay particular attention principles outlined in the DSV Code of Con- to specifying areas that employees encounter duct. The Code of Conduct establishes rules digitally, such as data privacy and social media. Our tax contributions for acceptable business conduct to make sure that employees act safely and ethically We will increase the amount of Code of Con- When it comes to tax, we have made a choice to act in what we in their everyday work. All employees must duct training and introduce an e-learning consider to be a fair and responsible way: we aim to comply follow the Code of Conduct, as these princi- module with the new publication in 2019 and with tax legislation and do not engage in aggressive tax plan- ples ensure that DSV always acts as a trust- we will continue to raise awareness and in- ning to avoid tax payment. We believe in contributing to the so- worthy business partner around the world. crease understanding of expected behaviour. cieties and local communities in which we operate, which is why our goal is to pay taxes following our commercial setup. The main principles of the DSV Code of Con- The goal is to ensure that all employees act duct related to business ethics and fair be- safely and understand the scope of their re- In 2018, DSV paid taxes in more than 75 countries and our haviour emphasise the importance of ensuring sponsibility as part of DSV. We will finish and corporate tax payments amounted to DKK 851 million. that employees act safely and lawfully. For publish the new version in 2019. Through our tax payments, DSV contributes directly and indi- example, the DSV Code of Conduct clearly rectly to local communities and to achieving most of UN’s 17 states that corruption or bribery of any kind is REPORTING VIOLATIONS THROUGH DSV’S sustainability goals, specifically SDG 16 and SDG 17. unacceptable, and that it is prohibited to en- WHISTLE-BLOWER PROGRAMME gage in activities that in any way breach com- Compliance with DSV’s fundamental ethical DSV does not practice aggressive tax planning or use tax ha- petition law or involves a conflict of interest. principles is crucial and non-negotiable. If an vens. Sometimes, however, offshore company constructions employee or business partner witnesses a breach are inherited via mergers and acquisitions. In that case, the pri- CODE OF CONDUCT AWARENESS or a suspected breach, he/she is urged to report ority is to liquidate these companies as soon as possible. We have processes in place to make sure that it through our whistle-blower programme. employees are aware of the expected be- Currently, DSV has non-operational subsidiaries in British Virgin haviour outlined in the DSV Code of Conduct. Unlawful or non-compliant conduct can be re- Islands, Curacao and Guernsey, which are all classified by the EU ported through the dedicated hotline or web- as non-cooperative tax jurisdictions. These entities inherited All new employees receive a copy of or a link site, which is administered by an external pro- from acquisitions are all dormant and under liquidation, which, to the DSV Code of Conduct when they start vider to ensure anonymity. In 2018, the scope unfortunately, is proving to be a cumbersome and lengthy pro- working for DSV. In addition, we provide of the whistle-blower programme was ex- cess, but remains a focus area. awareness introduction as part of our global tended, and the programme is now available onboarding programme for all employees – to both internal and external stakeholders. and special training for managers. Further, in 2018 we completed special training in re- Globally, we follow up on reported incidents gions selected on a risk-based approach. In and make sure appropriate action is taken. In this way, we strive to continously raise the 2018 the number of reports received through More about DSV’s approach to taxes can be found in; level of awareness of DSV’s business ethics. the whistle-blower programme was approxi- DSV’s global tax policy is publicly available at mately the same as in 2017, and still at a low dsv.com In 2018, we reviewed and updated the DSV level. Most of the received reports fell outside Code of Conduct. The new Code of Conduct the scope of the whistle-blower programme, DSV’s tax payments for 2018 are listed in will entail more explicit guidance on expected as they were employee issues that had to be DSV’s 2018 Annual Report behaviour, and make it more accessible. In our resolved by local management.
9 DSV Responsibility Report 2018 Business ethics KEEPING DATA SAFE As a global company, it is critical that we ensure compliance with international data privacy laws. In the European Union, the General Data Protection Regulation (GDPR) came into force in May 2018, enforcing Further information is available: stricter requirements for data privacy. DSV Code of Conduct carried out a project to ensure that the level Modern Slavery Statement of our data privacy setup continues to be Whistle-blower programme sufficient. We made improvements to issues identified. In addition to the improvements, we conducted training for employees based on their role and responsibility. We will con- tinue to work on keeping a high level of data security. SUBJECT OUR TARGETS FOR 2018 OUR ACHIEVEMENTS IN 2018 NEXT STEP AND TARGETS FOR 2019 TRAINING We will continue to maintain procedures to We have automated procedures in place ensur- We will ensure awareness of the updated Code ensure that all new employees at management ing that all new employees at management level of Conduct through: level receive training in the DSV Code of Con- received training in and passed related testing - Global roll-out and awareness campaigns duct. For present employees at management on the DSV Code of Conduct. for the Code of Conduct and whistle-blower level we will repeat the training continuously in programme. appropriate intervals. During 2018, these procedures underwent a review as preparation for the roll-out of the - Training in the DSV Code of Conduct for We will carry out training programmes for updated Code of Conduct training in 2019. employees below management level in the DSV Code of Conduct for employees selected regions. below management level within selected Further, special Code of Conduct training was fields in 2018. carried out in selected regions based on a risk - Uphold procedures to ensure that all new approach in 2018. employees at management level receive training in the DSV Code of Conduct. Existing employees at management level will repeat the training at appropriate intervals. COMPLIANCE REVIEWS A compliance review must be carried out in all 24% of all operating entities underwent a com- A compliance review must be carried out in all operating subsidiaries of the Group at least pliance review in 2018 which is an acceptable operating subsidiaries of the Group according once every three years. A compliance review proportion according to our risk-and materiality to an established risk and materiality approach, consist of follow-up on policies and proce- based approach, and our future target. according to which visits take place in intervals dures within our responsibility work. between two and four years.
10 DSV Responsibility Report 2018 Employees and working environment Worldwide, DSV employs more than 45,000 employees, whose efforts and dedication to driving DSV forward enable us to deliver the best service to all our stakeholders. EMPLOYEES AND WORKING ENVIRONMENT
11 DSV Responsibility Report 2018 Employees and working environment DSV must be a good and safe place to work In 2018, the total employee turnover-rate to have thriving employees, who can con- was 20.1%, compared to 17.4% the year tribute to the continued development and before. This is not a trend that we want to Refugees employed through the programme success of DSV. see in the coming years. pose for the camera in the Bochum warehouse. That means we are fully committed to pro- Part of the increase is related to a high de- viding positive, productive and supportive mand for certain employee groups, such as working environments in which we all feel those employed in our shared service cen- valued and safe. tres and blue-collar workers in a number of countries. They represent a significant part Further, with a presence in more than 75 coun- of the increase in employee turnover-rate. tries our employees have a multitude of back- grounds and different skills and experience. We Even though employee turnover increased believe that diversity benefits our business, as in 2018, it remains at an acceptable level. a broadly composed workforce provides a wide At the same time, we retain employees with range of competences that can foster new a high seniority who act as an important ideas, just as it allows DSV to anticipate future factor in facilitating knowledge-sharing and demographic changes in the workforce. driving the development of DSV. These commitments play an important part We are fully aware that DSV needs to retain DSV in Germany creates career in maintain a working environment that con- employees at all levels of seniority to main- opportunities for refugees tributes to retaining employees. tain knowledge and competencies and to secure DSV’s development. To that end, we In Germany, DSV’s Bochum site collaborated with the local job centre in running a We focus on two main areas in our work to have launched several initiatives both glob- programme in which unemployed refugees are offered a chance to get back on their ensure a good working environment: ally and locally aiming to both attract, de- feet. The programme was a success for all parties involved in 2018. velop and retain the best people. • Providing development opportunities DSV in Bochum often hires large numbers of new employees and decided to give for all employees; DSV provides development opportunities refugees a chance to prove themselves in DSV. for white and blue-collar employees alike. • Ensuring a safe working environment, The development programmes are closely The project is a collaboration between DSV and the local job centre in Bochum. They both physically and digitally. aligned with our business strategy and developed an integration plan for new employees. At the core of the programme was focus on customers, growth and operational a six-week placement, enabling employees to get to grips with the role. DSV ap- excellence. Ranging from leadership and pointed an experienced employee to head up the programme, while the job centre Providing opportunities sales training to literacy courses, the pro- selected six suitable candidates for every period, funded their forklift truck licences for all employees grammes all serve to equip employees with and provided interpreters to help with communication. the skills they need in their roles. We want our employees to be successful in Management in Bochum is happy with the new colleagues, who have all left very pos- their jobs and to grow their careers and, as itive impressions by being reliable and punctual employees - important qualities for a business, we aim to retain employees to employees in a busy warehouse. minimise churn.
12 DSV Responsibility Report 2018 Employees and working environment TALENT MANAGEMENT tential talents and where they work, identify- We view that diversity as a genuine strength. We are aware of the decline in gender ratio, To build a steady pipeline of talented and ing talent is expected to support employee and to counter this, we have among several competent employees and create robust retention. We believe that a balanced workforce with other initiatives, published a diversity policy succession plans for key positions in the equal access to opportunities for all is crucial in 2018 outlining our approach to diversity different areas of business, our global HR The developments in 2018 constituted the to our success as a business and contributes according to which we aim for a more bal- Department focused on talent management first step for even better talent management to ensuring a good working environment. anced workforce. In 2019 we will give fur- throughout 2018. in DSV. Following the good beginning, the ther attention to embedding the policy and area will continue to be a focus area within One diversity factor is gender, our gender foster greater awareness to diversity among HR worked to implement a framework for employee development in 2019. ratio being 38% female and 62% male in our entities in DSV. identifying people with potential for taking 2018 against 39% and 61% in 2017. on more responsibility and establishing an NEW DIVERSITY POLICY DSV’s diversity policy is publicly available at improved setup for talent and succession DSV’s global presence in more than 75 coun- At lower management levels, 28% were dsv.com management. The process offered valuable tries means we have a both multifaceted and female in 2018 and 72% were male, insights. Besides providing knowledge of po- diverse employee landscape. compared to 31% and 69% in 2017. Reporting on section 99b of the Danish Financial Statements Act - women and 67% men, one of whom is a U.S. citizen. 34 A similar ratio is not seen at lower management levels of DSV A/S, nor in other Danish legal DSV entities, but the Danish operational companies, have targets and initiatives in place to AGE DISTRIBUTION increase this ratio – both on higher and lower management OF EMPLOYEES (%) levels. 45-54 30% Further description is available in the Danish entities’ annual report. 4 20.5% 35 -4 29.8%
13 DSV Responsibility Report 2018 Employees and working environment A safe working Our health and safety departments’ efforts to occupational injuries in 2018. Similarly, In 2019, we will continue our efforts to are aimed at avoiding occupational acci- we have recorded a small increase in illness secure the safety of all employees in DSV environment dents or injuries all together. Both at Group on the year before. through even better processes for health and local levels, staff assess risk and make and safety being developed centrally and A good working environment is a safe work- sure procedures for safe conduct are However, all the above ratios are still at rolled out globally. ing environment, and that is a DSV top in place. an satisfactory level, and we do have pru- priority. We focus on minimising risks and dent safety procedures and a setup for raising awareness about safety for our We recorded a slight increase in numbers review that constantly makes DSV an even employees. of occupational incidents and in absence due safer place to work. RATE OF OCCUPATIONAL ACCIDENTS Group ABSENCE DUE TO ILLNESS Group (per million working hours) Salaried employees (%) Salaried employees Hourly workers Hourly workers Working hours (%) 16 4,5 14 4,0 3,5 12 3,0 10 2,5 8 2,0 6 1,5 4 1,0 2 0,5 0 0 2018 2017 2016 2015 2014 2018 2017 2016 2015 2014
14 DSV Responsibility Report 2018 Employees and working environment SUBJECT OUR TARGETS FOR 2018 OUR ACHIEVEMENTS IN 2018 NEXT STEP AND TARGETS FOR 2019 SAFE WORKING The rate of occupational accidents must be re- The rate of occupational accidents and lost The rate of occupational accidents must be kept stable ENVIRONMENT duced every year. work days due to occupational injuries increased and not exceed 5 per million working hours in total. slightly compared to last year. Lost work days due to occupational injury must The rate of lost work days due to occupational in- be reduced every year. juries must be kept stable and not exceed 100 per million working hours in total. To ensure even better procedures for our health and safety setup, we will develop and roll out an improved global approach in 2019. UN GUIDING We are committed to comply with the UN We worked to further integrate expectations PRINCIPLES Guiding Principles on Business and Human for responsible behaviour in line with the UN Rights and continue our due diligence process Guiding Principles into our Code of Conduct and disclosing local processes and practices on hu- supplier screening process. man rights to enable the remediation of any adverse human rights impacts we might We will maintain focus on this area in the coming cause or to which we contribute. years, but as a fully integrated part of the DSV Code of Conduct and supplier screening processes. We consider the target achieved. DIVERSITY To maintain focus on a diverse workforce, we OPPORTUNITIES will continue the efforts to roll our our new di- versity policy.
15 DSV Responsibility Report 2018 Environment and climate The transport sector is ENVIRONMENT responsible for about a quarter of total global carbon dioxide emissions. For this AND CLIMATE reason the sector indisputably has huge responsibility towards the environment.
16 DSV Responsibility Report 2018 Environment and climate As a significant player in the sector, the thou- Optimising supply chains to sands of transports DSV facilitates every day contribute to the use of fossil fuels. We ac- reduce environmental impact Recycling 100% of vehicle tyres knowledge our responsibility for contributing We work with our customers to optimise to a reduction in the use of fossil fuels in the DSV has taken a big step towards environmentally responsible their supply chains. Our efforts include value chain. processing of discarded tyres by acquiring ownership share of consolidating freight, choosing the right Tire2Oil in Denmark. mode of transport, and choosing the optimal To live up to this responsibility, we enter location for warehouses. Besides making into dialogues with customers and suppliers DSV is now co-owner of a patented technology which has po- good sense from a commercial perspective about initiatives that can contribute to re- tential to positively impact a significant environmental problem. for customers, all these aspects of supply ducing our impact on the environment. We chain optimisation may impact the environ are experiencing a gradual increase in the Through a thermal process, Tire2Oil transforms tyres into recy- ment in a positive way and can reduce the number of customers expressing an interest clable raw materials that can be sold on the world markets: oil, use of fossil fuels. in sustainable transports, and customers steel and carbon - without any harmful environmental impact. aiming to reduce their carbon footprint. PROVIDING CARBON EMISSION REPORTS However, they still only amount to a small TO CUSTOMERS NO MORE POLLUTION part of our customer base. DSV provides carbon emission reports to In many countries, discarded tyres accumulate in nature areas customers on their supply chains. The goal and are used for incineration, but Tire2Oil’s process is eco- With DSV’s asset-light business model we is to provide complete transparency in friendly. have a limited direct sphere of influence be- carbon emissions. cause the transport is carried out by suppli- The process produces no polluting residual products and the ers. That poses challenges throughout the The carbon reports can form the basis for factory does not emit smoke. The part of the gas which cannot value chain. In addition, the transport and lo- dialogues and collaboration with our cus- be condensed into oil can be used as fuel to heat the machinery gistics industry has been and continues to fo- tomers to find solutions that can help re- and surrounding premises. Thereby, the energy costs of operat- cus on cost, and current options for more duce the carbon footprint of the services ing the facility are limited. sustainable transports are likely to increase we provide on their behalf. the cost of a transport. Therefore, alterna- AIMING TO EXPAND TO THE REST OF EUROPE tives to traditional transports must be We experienced an increased demand for In 2018, the factory was up and running with a single production cost-efficient to gain a foothold. carbon emission reports for our customers line. The next goal is to triple the number of production lines, in 2018. In total, we provided 2,216 carbon followed by setting up or selling production facilities in the rest OUR EFFORTS TO INFLUENCE emissions reports for customers in 2018. of Europe. Despite the challenges, we continue our ef- That is a 75% increase on 2017. forts where we can influence the value chain COMPETITIVE PARAMETER the most. We focus on three main areas: In 2019, we will devote attention to refining Tyre recycling may not be DSV’s core business, but it combines our set-up for the preparation of carbon a need and a wish for environmental accountability with com- • Collaborating with customers to emission reports to ensure a good, transpar- mercial success. optimise supply chains; ent starting point for a dialogue about pro- • Working with suppliers and customers viding environmentally optimised transports. to develop sustainable solutions; • Focusing on responsible use of resources.
17 DSV Responsibility Report 2018 Environment and climate CONSOLIDATING FREIGHT We measure the energy efficiency for port modes emit different amounts of CO2. In fact, air freight emits approximately 95 Improving capacity utilisation is a way we transports, and our aim is to increase it each We help our customers find the right routes times more CO2e per shipment than sea can help significantly reduce customer’s car- year. We achieved that in 2018, increasing and transport modes that suit their needs for freight and road transports 8 times more. bon footprint. Making sure that trailers and energy efficiency for road transports by 1%. time of delivery and budget, while still focus- containers are loaded in the optimal way, In addition, we improved energy efficiency ing on choosing the most environmentally So, by being flexible on time of delivery the considering cargo weight, volume and den- for air transports by 3% and 3% for sea friendly solution. Generally, the faster the customer may be able to choose an alterna- sity, we can reduce carbon emissions and transports. transport and the heavier the goods, the tive transport mode that emits less CO2, improve energy efficiency because fewer higher the cost and carbon emissions. and sometimes even reduces the cost. transports go out without full loads. Besides TRANSPORT MODE being sustainable, it also reduces the overall Choosing a transport mode and route also Goods transported by air freight emit the costs for customers. impacts the environment, as different trans- highest amount of CO2e per tonne-km. Energy efficiency in average AIR TRANSPORT CO2e (g/tonne-km) CO2e (g/ tonne-km) 700 666.9 SEA TRANSPORT ROAD TRANSPORT 650 622.0 CO2e (g/ CO2e (g/ 607.0 601.9 tonne-km) tonne-km) 588.5 150 150 600 100 100 550 73.9 72.3 72.0 71.5 70.9 50 50 50 7.9 6.9 6.6 6.3 6.1 0 0 0 2018 2017 2016 2015 2014 2018 2017 2016 2015 2014 2018 2017 2016 2015 2014
18 DSV Responsibility Report 2018 Environment and climate Developing sustainable the lowest total transportation costs, and thereby the lowest carbon emissions. Our solutions Group Property Department, consisting of Transparency in carbon emissions specialists within the area, sets standards Reducing our impact on the environment and requirements for buildings Group-wide. We measure our total carbon footprint and energy efficiency for each transport requires changes, and changes require new mode for the DSV Group of companies. ideas. We engage with our suppliers and New DSV locations are built according to customers to make use of new ideas and in- some of the most demanding national and Because we use suppliers to carry out the transports booked by our customers, novative solutions that can help improve international building standards, and we in- most of the chart below contains carbon emissions from transports performed by carbon efficiency. vest in materials that can ensure energy ef- our suppliers. Our emissions make up approximately 2% of total emissions. ficiency. Also, new sites are built with en- It is equally important that DSV’s own fleet ergy efficient solutions like automated The majority of greenhouse gas emissions from our operations is attributable to air emits as little CO2 as possible. As an example, lighting and low energy light bulbs and wa- and road transports, constituting 42% and 46% respectively, while 11% of our a team of engineers in South Africa reduced ter saving fixtures. Lastly, new buildings carbon emissions came from sea freight and 1%. from DSV’s buildings. the carbon footprint of the long-haul trucks have good working conditions for employ- which travel longer distances by more than ees, and we e.g. prioritise natural lighting. 13% through fuel savings by implementing 1% aerodynamic drag reducers, which are thin In 2019, we will continue to focus on build- plastic items mounted on the trucks’ top or ing sustainably. 11% side to reduce wind resistance. This example shows that reducing our environmental im- pact is not always a question of inventing new Responsible use technologies, but it is also about using existing solutions to optimise wherever possible. of resources ENERGY EFFICIENT BUILDINGS DSV’s more than 1,000 sites around the world Our buildings are a part of our acitivties on vary from small office spaces to large ware- Breakdown which we can directly influence carbon houses of more than 100,000 m2. Each of of total emissions emissions. We continuously renovate, con- them uses paper, wooden pallets, plastic and solidate and build new warehouses to make cardboards, which we make an effort to recy- sure that our buildings live up to the energy cle wherever possible in our efforts to mini- efficiency requirements we set for our- mise DSV’s impact on the environment. selves. In 2018, DSV’s buildings emitted 55,000 tonnes of CO2 compared to 51,000 RECYCLING MATERIALS AND SORTING WASTE tonnes in 2017. This increase in emissions Across DSV, we are working to increase the 46% 42% is caused by DSV’s growth, as we built and number of sites with a systemic approach expanded in 2018. to garbage collection and recycling. When planning a building project, we calcu- The recycling initiatives vary across coun- ■ Sea transport ■ Air transport ■ Road transport ■ Buildings late which possible locations will give rise to tries and types of location.
19 DSV Responsibility Report 2018 Environment and climate Many DSV sites recycle spare cardboard, size of the locations. Due to the attention offices. The system helps minimise the envi- Our calculations from a handful of European paper and wooden pallets from operations devoted to recycling, we reached 79% in ronmental impact from printing and keep it offices showed impressive savings: Close to and activities, and other sites use only re 2018, which is a level we aim to further cost-efficient. FollowMe sends printed doc- 4 tonnes of paper were saved, a reduction in cyclable storage boxes in the warehouses. increase in 2019 to 80%. uments to a server, where they stay until electricity consumption by around 42,000 the employee releases the documents at KWh, reduced carbon emission by around For 2018, the goal was to recycle materials REDUCING PAPER CONSUMPTION a DSV printer. 11,000 CO2 (kg) and significant cost in 78% of our sites measured by square In 2018, DSV made it mandatory to use the reductions. metre, taking into account the difference in system “FollowMe” for printing in all DSV SUBJECT OUR TARGETS FOR 2018 OUR ACHIEVEMENTS IN 2018 NEXT STEP AND TARGETS FOR 2019 WORKING WITH SUPPLIERS We wish to increase collaboration with inter- We expanded our collaboration with customers, We will continue to increase our collaboration TO DEVELOP SUSTAINABLE ested strategic customers and suppliers in e.g. in relation to route optimisation. with interested strategic customers and suppli- SOULTIONS order to find transport solutions focusing on ers in order to find transport solutions focusing the reduction of carbon emissions and general We continued collaboration with suppliers in or- on the reduction of carbon emissions and gen- environmental impacts. der to develop sustainable business models and eral environmental impacts. transport solutions. TRANSPARENCY IN We will report on climate parameters such as The reporting and commentaries on climate pa- We will report on climate parameters such as CARBON EMISSIONS group carbon emissions, energy efficiency rameters were incorporated into the text of this Group carbon emissions, energy efficiency from from transport modes and energy and water chapter and in non-financial statements. transport modes and energy and water con- consumption from buildings. sumption from buildings. The data reported are based on a structured data collection and verification process carried out at To increase awareness of and transparency year-end 2018. about CO2 emissions among our customers, we will work on improving our CO2 emissions platform. We will implement an improved setup for re- sponsibility reporting internally and potentially externally to ensure even better transparency in our responsibility data. RESPONSIBLE USE We will in 2018 increase the share of DSV In total, 79% of all DSV square metres imple- We will work on increasing the share of DSV OF RESOURCES locations that sorts waste for recycling mented recycling procedures. locations that sort waste for recycling, measured per square meter to 78%. measured per square meter to 80% in 2019.
20 DSV Responsibility Report 2018 Suppliers DSV performs services for customers worldwide, and because of our asset-light business model, we rely on a large supplier network consisting of more than 200,000 suppliers. SUPPLIERS
21 DSV Responsibility Report 2018 Suppliers When our suppliers carry out services on and local levels. In 2018, we started devel- our behalf, they become DSV ambassadors, oping more customised sanction and sup- because we are part of the same value plier screening processes matching the dif- chain. Therefore, we expect every supplier ferent types of suppliers. An effort that will to share and live up to the same ethical continue during 2019. standards that we hold ourselves to. SUPPLIER AUDITS However, a large and widespread network We have processes for review of suppliers of suppliers means that DSV faces risks be- in place across our organisation. Depending yond our internal control from time to time. on the country, the DSV division and the To minimise these risks, we continously existing legislation, we measure supplier work to secure an even better standard compliance with our standards. We e.g for supplier conduct that rests on DSV’s use a quality management framework, fundamental principles. such as the ISO standards. We believe that by working ethically and On average, 31% of our locations have an expecting our suppliers to do the same, we ISO certification, compared to 25% in 2017. can help ensure an ethical business conduct in the supply chain. Having a quality management framework in place helps us set requirements for LIVING UP TO DSV STANDARDS suppliers. DSV’s ethical standards and required be- haviour are defined in the DSV Code of Often, this includes a dedicated quality Conduct. In our Supplier Code of Conduct, person that conducts supplier audits for these standards and requirements are spec- all transports whether by air, sea or road. ified and targeted for the suppliers to make it clear what we consider appropriate busi- IMPROVING STANDARDS FOR ness conduct by suppliers when they per- ETHICAL CONDUCT form services on behalf of DSV. As a mini- We believe that the processes we have in mum, suppliers must live up to the DSV place across DSV play an important part in Supplier Code of Conduct. maintaining a standard for ethical business conduct within DSV and in the transport For suppliers carrying out road freight ser- and logistics sector in general. vices, we distribute a Road Haulier Code of Conduct to hauliers. In addition to defining At the same time, our supplier network is the ethical code, the Road Haulier Code of large, and the many different types of sup- Conduct lists requirements for truck safety, pliers pose a challenge for ensuring align- safe conduct on the road, working rights for ment across the supply chain. drivers etc. Further, we have processes in place for supplier selections on both global
22 DSV Responsibility Report 2018 Suppliers It is an area in which we want to improve. Going forward, we will work to improve our global screening processes, which will be prepared centrally and anchored at the local DSV entities to make sure the pro- cesses are followed throughout our organi- sation and supplier network. In this way, we aim to put additional emphasis on the importance of a responsible and ethically business conduct from our suppliers. SUBJECT OUR TARGETS FOR 2018 OUR ACHIEVEMENTS IN 2018 NEXT STEP AND TARGETS FOR 2019 SUPPLIER CODE The DSV Supplier Code of Conduct must be 95% of our entities have communicated the Sup- We aim to further increase the number of suppli- OF CONDUCT communicated to suppliers and subcontractors plier Code of Conduct to relevant suppliers. ers to whom we communicate the DSV Supplier with a yearly spend above 25 kEUR. Code of Conduct. SUPPLIER SCREENING We will continue improvement of our supplier We improved our global screening processes with We will continue improving of our supplier PROCESS screening process through centralised and a new set-up for sanction screenings of all cus- screening process through centralised and decentralised procedures. tomers and suppliers. Furthermore, improve- decentralised procedures. ments are made in terms of general screening procedures when we onboard new suppliers’ master data. We mapped our onboarding processes according to the main areas. of the process. The findings will be used for improving in the onboarding process in each of these main areas.
23 DSV Responsibility Report 2018 Community engagement We make it a priority to COMMUNITY engage in and support the communities where we operate, using our expertise to help people in need. ENGAGEMENT We believe that long-term relations and transparent partnerships are paramount to achieving global, lasting improvement. Picture taken by employee Brian Hennesser on a Red Cross project visit in Malawi.
24 DSV Responsibility Report 2018 Community engagement Our efforts are primarily centered around and give them a chance to learn about do- our human aid partnership with the Red mestic hygiene and how to grow crops that Cross | Red Crescent and supported by a will last through droughts or floods. number of local activities. BETTER LIVING CONDITIONS FOR A PARTNERSHIP THAT MATTERS REFUGEES IN BANGLADESH 2018 was the second year with Red Cross Cox’s Bazar in Bangladesh houses the as DSV’s international human aid partner. world’s largest refugee camp. Close to one Through the partnership, DSV provides sup- million refugees live there in makeshift and port for transport, sponsors 2,000 m2 spontaneous settlements in crowded condi- warehousing space for disaster prepared- tions unprotected from dangers, cyclones ness, and we support Red Cross’ efforts in and monsoons. The vast majority of the Malawi and Cox’s Bazar, Bangladesh. refugees have fled to Cox’s Bazar since August 2017, and they have insufficient DSV’s support to and collaboration with the food, water, sanitation, clothing and basic Red Cross enables the organisation to work household supplies. towards reducing poverty and hunger, fighting climate change and improving the quality of In 2018, DSV started supporting the Red the education for children and youth in de- Cross’ work in Cox’s Bazar. The Red Cross veloping countries. has been able to support thousands of fami- lies with safe drinking water, and tens of CAPACITY BUILDING IN MALAWI thousands of homes have received hygiene In Malawi, Red Cross works to build resilience kits to help promote sanitation and hygiene. in the three poorest provinces in the south- ern part of the country. DSV’s support helped enable Red Cross make a significant contri- bution to reducing hunger and malnutrition: Red Cross are experts in providing disaster More than 14,000 school children receive a relief – but they cannot do it without support daily meal and more than 23,000 children and donations. So DSV made a donation to In- under five years of age receive a monthly donesian Red Cross to help the victims of the health check. disastrous tsunami and earthquake that oc- Photo taken by Danish Red Cross curred in Indonesia in September 2018. In the aftermath of the tsunami, the survi- DSV’s support to the people of Southern vors desperately needed help for essentials Malawi also helps build capacity by educating like clean water, food, shelter and clothing. the children of the area and teaching hygiene DSV in Indonesia reached out to their local and agricultural skills to women in the area. Red Cross to ask how DSV could best pro- vide aid. That resulted in a financial donation Close to 1,000 children receive a primary to emergency aid from DSV to Indonesian school education, and more than 11,500 Red Cross. The donation was used to distrib- children attend a Red Cross kindergarten. The ute canned food, blankets, tents and solar kindergartens free up time for the mothers lamps to the people who lost their homes.
25 DSV Responsibility Report 2018 Community engagement LOCAL COMMUNITY ENGAGEMENT to supporting local sports clubs or teaching For a number of years, DSV has made annual donations to the Child’s Cancer Fund. Community engagement is also a local pri- safe conduct on the roads. The support helps children with cancer and their families get by in difficult times during and following the treatment for cancer. For the 2018 donation, DSV’s CEO Jens Bjørn ority for DSV. Around the world, we interact Andersen presented the donation to the patron of the Foundation, Danish actress with the communities in which we operate Examples include that DSV in Spain sponsors Ghita Nørby, and CEO of the Child’s Cancer Foundation, Marianne Benzon Nielsen. to make a positive difference. the transportation of wigs for cancer patients who have lost their hair, DSV in Denmark and The local engagements take many different Norway engage in teaching road safety to shapes, from sponsoring the transportation school children, and DSV Germany runs a pro of different items that serve a good cause ject aiming to help refugees into employment. Children in the Peruvian Amazon region waiting for presents that DSV helped transport to the isolated area in December 2018. The children live in a community that is difficult to access, so DSV decided to help transport Christmas presents for the children and other seasonal goods to Bagua and Santa María de Nieva in Peru for the fourth consecutive year.
26 DSV Responsibility Report 2018 Non-financial highlights of the DSV Group NON-FINANCIAL HIGHLIGHTS OF THE DSV GROUP Environmental data 2018 2017 2016 2015 2014 2018 2017 2016 2015 2014 Transport emissions (‘000 tonnes) Euro engine standards (%) - Estimates on Suppliers Proportion of trucks of DSV Road 0.7 0.7 1.2 1.6 2.5 CO2e emissions – Total transport 6,344 6,278 5,921 3,687 3,388 satisfying Euro 2 standard or older CO2e emissions – Sea transport 715 738 757 516 566 (own and suppliers’ trucks) CO2e emissions – Air transport 2,660 2,593 2,425 1,270 1,278 Proportion of trucks of DSV Road 19.3 20.8 24.1 29.8 33.7 satisfying Euro 3 or 4 standards CO2e emissions – Road transport* 2,969 2,947 2,739 1,901 1,544 (own and suppliers’ trucks) Direct emissions (‘000 tonnes) Proportion of trucks of DSV Road 80.0 78.5 74.7 68.6 63.8 satisfying Euro 5 or 6 standards CO2 emissions – Buildings** 55 51 63 48 45 (own and suppliers’ trucks) Water (‘000 m3) Reports on carbon footprint data to customers Total water consumption – Buildings 689 666 534 332 260 Total number of reports on carbon 2,216 1,265 1,141 1,243 1,214 Energy efficiency in average (gram footprint data to customers CO2e per ton transported one km) Reports on carbon footprint CO2e (g/ton-km) – Sea transport 6.1 6.3 6.9 6.6 7.9 data to customers (%) CO2e (g/ton-km) – Air transport 588.5 607.0 601.9 622.0 666.9 Proportion of total carbon dioxide 8.6 7.2 4.9 7.2 - CO2e (g/ton-km) – Road transport 71.5 72.3 73.9 72.0 70.9 equivalent emissions reported to customers Recycling of paper, cardboard and plastic (%) Proportion of locations recycling paper, 79 74 70 88 85 cardboard and/or plastic from offices, terminals and warehouses * Our own fleet make up 0-1% of total road emissions ** Emissions are emitted only by DSV buildings
27 DSV Responsibility Report 2018 Non-financial highlights of the DSV Group Social data 2018 2017 2016 2015 2014 2018 2017 2016 2015 2014 Employees (full-time employees) Employee turnover (%) Total 47,394 45,636 44,779 22,783 22,874 Total 20.1 17.4 25.5 17.6 16.6 Salaried employees 23,088 22,730 23,436 14,540 14,216 Salaried employees 20.7 17.4 26.0 16.8 16.6 Hourly workers 24,306 22,906 21,343 8,243 8,658 Hourly workers 19.4 17.3 24.9 19.0 16.7 Employee gender ratio (%) Absence due to illness (%) Proportion of female employees 38 39 38 38 38 Total 2.4 2.0 2.1 3.3 3.3 Proportion of male employees 62 61 62 62 62 Salaried employees 2.7 2.0 2.0 2.9 2.8 Hourly workers 2.1 2.0 2.2 4.0 4.1 Management gender ratio (%) Proportion of female managers 28 31 31 26 - Rate of occupational accidents (per million working hours) Proportion of male managers 72 69 69 74 - Total 4.6 4.2 4.6 5.9 5.9 Age distribution of employees (%) Salaried employees 0.5 0.8 1.3 1.2 1.4 Employees 54 11.7 10.9 11.4 12.8 11.4 Salaried employees 23.2 20.8 9.7 26.2 17.6 Employee seniority (%) Hourly workers 164.5 142.5 133.5 263.7 275.0 Seniority 25 years 4.9 5.8 5.8 7.1 6.3 Distribution of DSV’s Supplier Code of Conduct (%) Proportion of companies having distributed 95 93 79 80 - DSV’s Supplier Code of Conduct to suppliers delivering goods and services for more than EUR 25,000 each year
28 DSV Responsibility Report 2018 Non-financial highlights of the DSV Group ACCOUNTING POLICIES FOR Social data RATE OF ABSENCE Number of days of absence due to illness NON-FINANCIAL HIGHLIGHTS relative to the number of working days during the year adjusted for maternity/pa- GENERAL DETAILS ternity leave, agreed holidays and national The figures and charts of the 2018 Respon- public holidays. Absence due to illness is sibility Report have been prepared in accor- measured on the basis of wage/salary Environmental data ENERGY EFFICIENCY dance with the policies applied last year system records. Average emissions from shipment relative to freight volume and transportation distance. EMPLOYEES RATE OF OCCUPATIONAL ACCIDENTS Average number of full-time employees of Number of reported occupational accidents GENERAL DETAILS EURO ENGINE STANDARDS the year. resulting in more than one day of absence The figures and charts of the 2018 Respon- Proportion of different Euro engine stan- per million working hours scheduled for sibility Report have been prepared in accor- dards of trucks operating for DSV Road. EMPLOYEE GENDER RATIO the year. dance with the policies applied last year. Data collected in Europe among more than Number of female and male employees 15,000 trucks owned primarily by suppliers. relative to total employees at year-end. RATE OF LOST WORK DAYS DUE EMISSIONS TO OCCUPATIONAL INJURY Carbon dioxide equivalent emissions from REPORTS ON CARBON FOOTPRINT MANAGEMENT GENDER RATIO Number of reported days of absence from transport activities are calculated based on DATA TO CUSTOMERS Number of female and male managers occupational accidents resulting in more average fuel consumption ratios from sup- Total number of reports on carbon footprint relative to total managerial employees at than one day of absence per million working pliers and trucks owned by DSV, combined data delivered to customers. year-end. hours scheduled for the year. with data on freight volumes and routing from DSV’s own traffic management sys- PROPORTION ON CARBON FOOTPRINT AGE DISTRIBUTION OF EMPLOYEES QUALITY MANAGEMENT STANDARDS tems. The calculations include CO2 emis- DATA TO CUSTOMERS Number of employees by age group relative Percentage of DSV locations certified sions from air and sea carriers and road Proportion of total transport emissions re- to total employees at year-end. according to ISO 14001, ISO 9001 or hauliers. ported to customers in carbon footprint re- ISO 45001 (OHSAS 18001). Number of porting. EMPLOYEE SENIORITY locations certified relative to the total Carbon emissions from buildings are cal Number of employees by seniority level number of locations of the Group. culated based on direct consumption of RECYCLING OF PAPER, relative to total employees at year-end. electricity, gas, oil and water from DSV’s CARDBOARD AND PLASTIC DISTRIBUTION OF DSV’S SUPPLIER location. Total square metres at DSV locations having EMPLOYEE TURNOVER CODE OF CONDUCT initiated recycling schemes for paper, card- Number of employees leaving DSV Group Number of companies having distributed WATER board and/or plastic, relative to total number during the year relative to the average DSV’s Supplier Code of Conduct to suppliers Total consumption of water at DSV’s lo of square metres locations of DSV. A few en- number of employees calculated on the ba- relative to total number of companies of cations. tities have leased premises without waste sis of monthly surveys of the actual number the Group. management schemes operated by DSV. of employees at the end of the month. Those locations are not included in the data.
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