UC RUSAL Sustainability report 2015


Ethics and human rights

Approach

The corporate culture of UC RUSAL is based on high ethical standards stipulated by the Corporate Code of Ethics and the Business Partner Code, which are mandatory for all Russian and foreign companies.

Corporate Code of Ethics

Ethical principles

The document determines the system of values and ethical principles, standards and norms of behavior in which the Company managers and employees should take into account in their activities[10]. Provisions of the Corporate Code of Ethics apply to mutual relations inside the Company (requirements to the employees) and to relations with external stakeholders – investors, clients, business partners, competitors, public authorities and local communities. G4-56

All new employees are advised and trained on the Corporate Code of Ethics.

Control procedures

The Directorate for Control, Internal Audit and Business Coordination (Directorate for Control), within the frameworks of on-site and off-site inspections of financial and economic activity of UC RUSAL enterprises also checks the compliance of corporate conduct and documentation with the standards contained in the Corporate Code of Ethics.

Special inspections also include analysis of the activities and documents on specific functional directions. For example, during personnel-related inspections the Directorate for Control checks the employment contracts for compliance with the laws and regulations of the Corporate Code of Ethics, as well as for compliance with the employee labour rights.

All employees can write to or call the UC RUSAL Line of Trust and inform about any violations, including violations of human rights. All messages will be considered by the Directorate for Control, together with the corresponding functional subdivision, if required. Long-term experience shows that anonymous reports on human rights violations through the Line of Trust are not confirmed, as a rule.

Corporate ethics representatives (CER)

Monitoring of ethical principles compliance is carried out by 32[11] corporate ethics representatives on a permanent basis. Employees combine these elective duties of corporate ethics representative with their primary duties. Their activity is regulated by Reports Handling Procedure for Corporate Ethics Representatives.

The main task of corporate ethics representatives is to ensure compliance with the standards of conduct that the Company has set for itself. The representatives should primarily assist employees in finding optimal solutions to ethical situations, prevent or minimize consequences of violations.

All employees have the opportunity to ask questions and receive answers and the spectrum of the incoming questions is wide enough and often extends beyond the content of the Code of Ethics. The corporate ethics representative make their reports on a monthly basis which keeps on top of the most problematic areas whilst monitoring the effectiveness of the measures taken. G4-58

Extract from the Reports Handling Procedure for Corporate Ethics Representatives:

In case an ethical situation is such that cannot be solved at the level and by the Representative …, the Representative attracts for the situation regulation (investigation) <other subdivisions>, in particularly in complicated cases, initiates a meeting with the manager or CEO, representatives of the Directorate for Legal Issues and the Human Resources Directorate of the enterprise and creates a temporary working group to consider complicated ethical situations.

Where necessary, the representatives may propose amendments to the Corporate Code of Ethics and Regulations of the Company’s organizations. For example, in case of the new areas in business or new organizations in the Company’s structure, the corporate ethics representatives can be invited to evaluate the situation in terms of compliance with the Corporate Code of Ethics. Based on the inspections results they may elaborate additional clarification in case of a potential threat of unreasonable protection, bias or discrimination. G4-57

Each Russian company has one corporate ethics representative. Corporate ethics representatives are elected for three years and, on the expiry of this term, they undergo a performance assessment procedure. 17% of the corporate ethics representative underwent the performance assessment procedure in 2015. One or two times per year the representatives pass trainings for competence improvement. In 2015 the representatives took part in the training which included theoretical and practical parts (solving specific cases, situations modeling).

Characteristics of corporate ethics representatives activities G4-LA16, G4-HR12

Indicators

2014

2015

Number of corporate ethics representatives

36

32

Number of grievances (reports) handled by corporate ethics representatives

198

156

Number of meetings held by corporate ethics representatives

230

314

 

Business Partner Code

In 2015 UC RUSAL was the first Russian company to put in place the Business Partner Code[12]. This document defines the principles and requirements to suppliers of goods, works and services, as well as to intermediaries, consultants and other business partners. The content of the Business Partner Code is based both on the UC RUSAL Corporate Code of Ethics and the principles of the UN Global Compact. G4-56

The Business Partner Code is based on an approach that focuses on sustainable development of the aluminium industry and it contains six principles:

·         good faith and integrity in commercial activity;

·         responsibility for relations with the society and public authorities;

·         occupational safety and protection of human rights;

·         health protection and industrial safety;

·         environmental safety;

·         ensuring the quality and safety of goods, works and services.

By entering into a contractual relationship with the participants of UC RUSAL, business partners agree to meet the requirements of the Code. The Company expects them to voluntarily implement these principles in their activities to improve competitiveness of their business, the business of the partners and throughout the supply chain to final consumers.

The document was approved by the Management Board of UC RUSAL and implemented in business processes in the system of cooperation with the key suppliers (new criteria to partners evaluation system have been introduced) at all enterprises of the Company. Starting from 2016 application of the Code will be extended to all participants in supply chain of UC RUSAL.

Human Rights

Approach

Since its establishment, UC RUSAL has paid particular attention to the issues of human rights as an integral part of its corporate culture and strategy in the field of social responsibility and sustainable development.

UC RUSAL shares the principles established in the International Labour Organization conventions, the Universal Declaration of Human Rights and the UN Global Compact, and in the Guidelines for Multinational Enterprises of the Organization for Economic Cooperation and Development.

The main documents which reflect UC RUSAL’s position with respect to human rights protection are in the Corporate Code of Ethics and the Business Partner Code; certain provisions are also contained in the Policy on Human Resources. The contents of these documents cover the entire spectrum of human rights established in international standards and guidelines. These include the following principles:

·         non-discrimination on grounds of sex, race and / or religion;

·         refusal to use child and forced labor;

·         respect for cultural specificities of countries and regions of presence when making decisions and carrying out activities;

·         providing working conditions which are safe for life and health of employees, adoption of measures to prevent occupational injuries;

·         compliance with the legal provisions relating to work and rest time, overtime, wages, working hours, etc.;

·         fulfilment of all necessary actions needed to reduce the impact on the environment;

·         observance of the norms and rules of business ethics and law, implementation of activities without corruption; compliance with the laws relating to combating the legalization of illegally acquired funds;

·         compliance of rendered services and supplied goods with quality and safety standards.

UC RUSAL endeavors to implement the above principles while ensuring due attention to human rights in the process of production and the related activities:

-       promotes respect for human rights in their own activities and the activities of the partners, on which the Company may have an impact through development and implementation of corporate documents and monitoring and control mechanisms;

-       periodically conducts self-analysis which allows finding out violations of human rights, if any, in the activities of the Company enterprises (including through the activities of corporate ethics representatives).

The Company has no separate procedure to assess the status of human rights observance at the enterprises due to the fact that this aspect is a part of more general procedures on corporate codes observance, which UC RUSAL considers sufficient at this stage to ensure the effectiveness of control.

Human rights in activity of UC RUSAL

Taking into account the international practices and the UN Guidance for Companies to Report on Human Rights Issues, RUSAL outlines the following aspects, in which these issues can be relevant for its business in Russia and abroad:

-       implementation of the laws in the countries of presence, work with complaints and appeals;

-       labor relations;

-       relationships within the supply chain, including procurement of resources from areas where conflicts occur;

-       the impact of the local communities including the fair use of natural resources, taxes, manufacturing impact on health, employment and well-being of local people in the regions of mining and production.

Labour relations

UC RUSAL complies the legal provisions relating to working hours and rest periods, wages, social benefits in the countries of presence, which is stipulated in collective labor agreements (or equivalent documents). The Company cooperates with the trade unions and other representatives of the legitimate interests of employees, seeking to address emerging issues during negotiations. Negotiation results are fixed in the relevant agreements. Some enterprises have up to four different trade unions. G4-HR4

Example. Relations between employees and employers in Guinea are regulated by two documents: Labor Code of the Republic of Guinea and collective labor agreements between workers of the mining sector of Guinea and Trade Unions of mines, open cast mines and chemical industries. The collective labor agreement being in force since 1995 defines the rights and obligations of the parties in such areas as employment, training, salaries and social benefits, living standards and conditions, health, hygiene and safety. The Company complies with all the provisions of this document. Workers of the Guinean enterprises of the Company enter voluntarily into trade union organizations, represented mainly by the National Confederation of Guinean Workers (CNTG).

Control over compliance with the labor legislation in divisions and enterprises of the Company is fulfilled also by the Directorate for Control, Internal Audit and Business Coordination. During on-site inspections the Directorate carries out selective employee surveys to identify, inter alia, violations of labor rights of workers (including cases of discrimination, forced labor and so on). In 2015 RUSAL conducted a comprehensive audit of personnel services in all enterprises and no violations of workers' rights were identified. G4-HR6 G4-HR5 G4-HR9

The remuneration system with grades applicable in UC RUSAL does not include consideration of a gender factor, which provides for equal pay for equal work for men and women.

Training on human rights issues, especially in the aspect of compliance with labor rights, is conducted for employees of personnel services.

80 employees of the enterprises and the management company passed training at various seminars in 2015. The training was organized on topics related to changes in labor legislation of the Russian Federation, special assessment of working conditions, occupational safety and health issues and certification of workplaces (1,177 hours in total). G4-HR2

The Company adheres to the principle of diversity and equal opportunities which is manifested in increasing women's representation in senior management bodies, providing career opportunities for employees at all levels. Details see in Section "Corporate Governance".

Safety

Safety of the employees in RUSAL enterprises and in contracting organizations is one of the main priorities of the corporate social responsibility. Policy in this field applies to all enterprises of the Company. The system of controlling occupational health and safety includes mechanisms to assess the status of occupational safety and take prompt measures (for example, audits of management systems at enterprises). The requirements for compliance with safety standards are included in contracts with service providers. Details see in Section "Occupational Safety and Health" and "Supply Chain".

All employees of contracting organizations ensuring safety at the enterprises and facilities of RUSAL pass training for specificities of the access control rules and the intra-building rules application, as well as attend all periodic briefings. Among the themes discussed in these training sessions are such issues as human rights in connection with the activities fulfilled. G4-HR7

Security personnel (guards) are specially trained and such training includes familiarization with the standards of human rights respect.

Supply chain

The Company has issued the Declaration DRC Conflict Minerals Free Manufacturer.

Local communities G4-MM5, G4-HR8

Production facilities of the Company are remote, as a rule, from the places of compact residence of the local population. All assets owned by the Company in foreign countries had already existed at the time of their acquisition. UC RUSAL undertook no "greenfield" projects, thus such issues as land and natural resources use were resolved by local authorities without participation of the Company.

The Company implements voluntarily charitable programs aimed at improving the quality of health care, education and living conditions in the countries of presence. Details see in Section "Implementation of Social Programs in Foreign Countries".

Results in 2015

Following the 2015 results the Company received no complaints related to violations of human rights in its enterprises in the regions of presence. Moreover during the reporting period there was no accident causing damage to life and health of workers and residents of nearby areas. Cases of violation of the rights of indigenous (local) people were not registered. G4-MM5 G4-LA16 G4-HR3 G4-HR8