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Code of Ethics

In every area of our activity, regardless of its location, character and involved persons – we want to act in an ethical way. In the whole KGHM Group, the Code of Ethics is in force as one of the pillars of KGHM’s organizational culture which is deeply rooted in the mining and metallurgical traditions. They constitute the genetic code of our community and build our professional identity. The Code of Ethics aims to ensure compliance of the employees’ behaviors with the highest standards based on accepted values. The status of a global leader and international corporation obligates us to keep the highest standards of the business ethics. It also entails challenges resulting from the richness of the national cultures within which we operate. Every day we show that this diversity contributes to KGHM’s success and allows us to build our brand. The KGHM Group Code of Ethics comprises a consistent system of values and principles which are close to all employees of the KGHM Group. They constitute our moral commitment towards our collaborators and business partners. Compliance with the rules set out in the Code of Ethics is of key importance to maintaining the efficiency of our processes and assuring our shareholders, suppliers and other stakeholders about our professionalism and honesty. The Code of Ethics also serves as the basis for our regulations connected with the Procurement Policy – the Code ensures rules and standards of professional conduct of persons participating in procurement processes. We would like our Code of Ethics to respond to current challenges at all times – if needed, we will update its provisions. Our Code of Ethics is available at our websites at: www.kghm.com/en/investors/corporate-governance/code-ethic

As a socially responsible company, KGHM Polska Miedź S.A. applies the due diligence procedures – we attach importance to observance of human rights, lawful terms of employment, environmental norms, freedom of establishing trade unions, prohibitions against child labor and extraction of production raw materials from conflict sources (the so-called “Conflict minerals”). We want to cooperate with business partners who share these values. For this reason, KGHM’s customers and suppliers are obligated to declare in writing their compliance with the aforementioned principles by signing the so-called Customer Card and Supplier Card. For us, it is an important element of the business decisions on undertaking cooperation with the given partner

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Principles declared by KGHM Polska Miedź S.A.’s Customer and Supplier

Human rights and work standards
Basic human and employee rights

Promotion of the principle of equal opportunities among the employees and ensuring a work environment free of discrimination and harassment. Additionally, it declares compliance with the local laws regarding work time, minimum wages and right of association in employee organizations.
Prevention of forced and child labour

Compliance with international human rights standards, elimination of all forms of illegal or forced labor and prohibited child labor, in accordance with local regulations.
Occupational safety and health

Controlling the threats and taking preventive actions to avoid accidents at work and occupational diseases. Additionally, we undertake to educate employees on occupational safety and health.
Ethics and Business Activities
Environment
Prohibition of corruption and influence peddling

No tolerance for any forms of corruption, including direct or indirect influence peddling of business partners and/or state officials and accepting gifts, other than customary gifts, in return for the purchase of products or services from business partners.
Money laundering prevention

No intentional participation in the money laundering process and implementation of preventive measures in this area.
Environmental protection

Minimizing pollutions and constant improvement of environmental protection standards and acting in accordance with local and international environmental protection standards.
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Anti-Corruption Policy

We conduct our business activity fairly. We do not accept any form of corruption and, in all the company’s activities, we require from our employees to comply with the fundamental ethical values. Understanding the importance of the corruption problem, we decided to take broadly planned actions to mitigate the risk. In 2017, an anti-corruption program was introduced at KGHM Polska Miedź S.A., regulating, among other things, issues of conflict of interest and reporting abuses. The program translates the principles set out in the Code of Ethics into specific actions, and its purpose is to build awareness among all employees, which is indispensable for the employees to identify with the company’s ethical conduct. The elements of the Anticorruption Program include the Anticorruption Policy and Anticorruption Instruction adopted by the Management Board of KGHM Polska Miedź S.A. in 2017. The primary aim of the Anticorruption Policy is to establish mechanisms for prevention of such behaviours of the company’s employees and cooperating entities which could be recognized as prohibited in all jurisdictions in which the company conducts operations. As part of the policy, an organizational structure has also been established to guarantee cooperation and coordination of the anticorruption ef orts on the KGHM Group level. G

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Anticorruption program – selected activities:

  • familiarizing employees with the documentation making up the anticorruption program – developing an active training system, constant improvement of employee qualifications
  • introducing an internal control system – detecting and eliminating identified irregularities,
  • undertaking actions that encourage reporting of corruption events/threats, with the possibility of remaining anonymous,
  • appropriate handling of the reports – removing the problem together with the cause of the irregularity, conducting an analysis to prevent similar situations from happening
  • guaranteeing that each breach of the implemented procedure results in a sanction
  • exchanging information/experience – both on the forum of the organization and outside,
  • e.g. with business organizations, updating the program/procedures.

Our Anticorruption Guidebook is available for each employee via our internal KGHM Corporate Portal. We have appointed local coordinators in KGHM Branches and the Group Companies to fight corruption, whose role is to train employees. These persons are also authorized to receive information about breaches if any.

KGHM Polska Miedź S.A. has in place whistleblowing procedures using a dedicated special telephone line, e-mail address and written correspondence – with a note “personal delivery”.

Anticorruption Instruction

The Anticorruption Instruction contains a more detailed description of the rules found in the Policy and is addressed to the employees of the Polish portion of the KGHM Group. It sets forth, among other things, the rules of conduct in situations in which employees may be offered financial benefits, rules for the avoidance of conflicts of interest and rules for offering and accepting customary business gifts.

In 2017, we def need the plan of action for reporting conflicts of interest, together with the specif cation of situations that may lead to conflicts of interests.

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The action plan to report a conflict of interest and a list of possible causes
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Diversity declaration

At KGHM Polska Miedź S.A., we strictly comply with the prohibition of discrimination and take actions in order to ensure respect of diversity in the workplace. Our organizational culture is based on mutual respect, equal treatment, access to development opportunities and optimal use of employee talent regardless of, inter alia, ethnic origin, age, gender, nationality, citizenship, religion, political beliefs or trade union membership. We aim at ensuring reasonable diversity both in the selection of personnel as part of the conducted activities, with a special focus on knowledge, technical competence and social skills. Further information on our approach to diversity in the supervisory bodies is presented in the Statement on Corporate Governance of the Management Board Report on the Activity of KGHM Polska Miedź S.A. and the KGHM Polska Miedź S.A. Group in 2017.

There is no common Diversity Policy in a written form applicable across the KGHM Group. Taking into consideration the international nature of our activities, cultural differences and specific natures of the Group’s industries, each company has been performing a number of structured actions in the area of respect for diversity. KGHM Polska Miedź S.A. – as the parent company – guarantees the implementation of the diversity principles across the Group and promotes and popularizes these values among the stakeholders and business partners.

http://www.gpw.pl/best-practice
http://www.kghm.com/en/inwestors/corporate-governance/governance-compliance


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Declaration of Human Rights Protection

At KGHM Polska Miedź S.A., we declare that we recognize, respect and promote human rights everywhere we conduct our business. We do not tolerate any violations of human rights. We undertake to conduct our operations in compliance with the Universal Declaration of Human Rights of the United Nations and with other norms and standards, including legislation and implementing regulations of the target countries of our business activity. We are a global organization, aware of the importance of respect for human rights in the modern world. We accept responsibility for protection and respect for fundamental human rights and implement such standards across the KGHM Group. We assume that respect for human rights by other entities is a vital element of mutual relationships. 

In compliance with the adopted principles, each employee and collaborator of the KGHM Group is responsible for ensuring that human rights are respected in his/her closest environment and any infringements are reported according to the agreed procedure. This Declaration is the basis of our approach to human rights. It supplements and consolidates the human rights issues considered in the Company’s other policies and guidelines, such as the Code of Ethics, the Diversity Declaration, HR and the Responsible Supply Chain Policy.

Implementation of the Declaration of Human Rights Protection:

  • each employee provided with access to a computer receives the accepted declaration electronically, via the Company Document Circulation System
  • employees with no access to a computer for work purposes are informed of the declaration implementation via extranet (accessible to all employees) and by their direct superior
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BEST PRACTICE

An internal responsible gold supply chain management system has been implemented at KGHM Polska Miedź S.A. It is comprised of the Responsible Supply Chain Policy in the KGHM Group and the Responsible Gold Supply Chain Audit Procedure in KGHM Polska Miedź S.A. The system is subject to independent external audit to ensure its compliance with LBMA Responsible Gold Guidance and the LBMA (The London Bullion Market Association) certification. Additionally, we have set up the e-mail address: ict.minerals@kghm.com for business partners and other stakeholders, at which comments and objections concerning the gold supply chain may be submitted

Employee benefits and remuneration

We of er fixed the remuneration to our employees. The amount of financial benefits depends on the length of service, experience and the position held. The following additional benefits provided to employees are also a component of remuneration for work:

• financial benefits from company social benefit funds, 

• contributions to the employee retirement scheme, 

• the prepaid healthcare package for employees and their spouses funded by the employer, 

• employee insurance, 

• commuting allowance

KGHM Polska Miedź S.A. is also obligated to pay specif c benefits after the end of the employment period (retirement benefits on account of a one-of retirement and disability package, death benefits, a cash equivalent for the coal benefit) and other long-term benefits (in the form of long-service payments) in accordance with the Company Collective Bargaining Agreement. The level of benefits in the Group’s foreign companies varies depending on the country, but in all cases covers insurance required by law, including social security and health insurance. Additionally, employees in Canada and the United States have access to, among other things, dental care and the Employee Family Assistance Program (EFAP) guaranteeing advisory services on a broad range of issues − from psychological and legal assistance, through family matters, to health issues.

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International Mobility Policy

In the 21st century, KGHM has become a global miner active on three continents. On one hand, such a large magnitude of operation substantially curtails the risk of disturbance in the continuity and quality of production, while on the other hand, it facilitates the continual transfer of knowledge and experience between its various units. Its mobility policy enables it to post the most prominent experts wherever their expert knowledge is needed to derive business benefits. That also leads to the diversification and enlargement of its product portfolio. 

In connection with the acquisition of foreign assets, since 2015 KGHM has conducted an employee mobility program. In view of the international operations of the Group, the International Mobility Policy has been adopted as the basis for action in conformity with the rules of the due diligence procedure. The secondments to companies in Chile, Canada and the US represent an investment of major significance for the Group. They not only satisfy the local requirement for personnel but also develop the employee’s professional capacities. In 2017, 10 employees (including 9 persons from KGHM Polska Miedź S.A.) were seconded to work in foreign assets under the International Mobility Policy. At the same time, 5 persons continued their secondment commenced in previous years. In 2017, more than ten employees worked in foreign companies of the Group under the International Mobility Policy, mainly with managerial responsibilities and tasked with the performance of the production process. 

Based on the hitherto challenges and experiences related to employee mobility, an interdisciplinary team developed an update of the International Mobility Policy focused on increasing the process efficiency. New rules are to be implemented in 2018.

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