Integrity in Business

Ethics and Compliance Programme

Compliance Governance  GRI 103, GRI 102–18 

The Chairman of the Board of Directors has entrusted the Risk and Compliance Committee of the Kuehne+Nagel Group to support the Board of Directors and the Management Board for applying the standards of good corporate governance.

Designing the Ethics and Compliance Programme has been delegated to the Chief Compliance Officer, who with subject-matter expertise has been assigned independence and authority for implementing the Programme in all business areas and subsidiaries in cooperation and with support from the Kuehne+Nagel management as well as other qualified resources and functions.

The independence of the Chief Compliance Officer function has been established by reporting directly to the Chief Executive Officer. Complementary reporting lines exist to the Audit Committee Chairman of the Board of Directors and the Group General Counsel. The Chief Compliance Officer is supported by corporate, regional and local compliance representatives, and as needed involves other internal functions, such as Internal Audit, Legal or Human Resources, or external support.
 

Ethics and Compliance Programme

Complying with internal requirements, laws and regulation as well as with common standards and rules of professional conduct is vital to Kuehne+Nagel’s business and marks a minimum expectation for Kuehne+Nagel employees.

Any comprehensive Ethics and Compliance Programme begins with the leaders. Thus, ethical leadership helps setting the right priorities and driving culture forward. Therefore, Kuehne+Nagel expects its leaders to constantly act as role models when integrating the culture of compliance into their area of responsibility.

Ethics and Compliance Programme
 


Code of Conduct and Policy Framework  GRI 102–16, GRI 409–1

Kuehne+Nagel’s Code of Conduct determines the general principles of expected business conduct and behavioural requirements that Kuehne+Nagel employees must consistently and continuously apply in their business activities for establishing a solid cornerstone of integrity beyond legal regulations.

The Code of Conduct is complemented by internal policies and guidelines. These supplementary materials address specific compliance topics and provide guidance to every Kuehne+Nagel employee on standards and procedures that are specific to particular compliance risks, including Anti-Trust, Anti-Bribery, Conflict of Interest or Gift and Entertainment.

Every Kuehne+Nagel employee is encouraged to read, understand and apply the principles, and be fully aware of the meaning and significance of the Code of Conduct and its complementary guidelines. Kuehne+Nagel employees are also expected to propagate the principles of the Kuehne+Nagel Code of Conduct to everyone in their sphere of influence.

In January 2019, an enhanced version of the Kuehne+Nagel Code of Conduct was launched. For each of its 19 chapters, respected and fostered (as well as not tolerated) principles comprehensively clarify expectations. The Code of Conduct has been released in 43 languages. The English version is publicly available on our internet website www.kuehne-nagel.com. By applying set standards, audits and reporting we comply with SDG 16, 17.
 

Enabling Kuehne + Nagel Members  GRI 205–2 

Code of Conduct Curriculum

Kuehne+Nagel expects its employees to always act in line with Kuehne+Nagel’s business principles and are required to acknowledge the Kuehne+Nagel Code of Conduct when entering into an employment contract. (SDG 16.3)

Further, Kuehne+Nagel employees with personalised company email accounts are required to annually confirm having read and understood the Kuehne+Nagel Code of Conduct. This confirmation is available in eight different languages and can only be completed if the Code of Conduct document was opened and reviewed in the Kuehne+Nagel intranet and if mandatory test questions have been answered correctly. Progress and completion is monitored at the corporate level for ensuring a continuous participation rate exceeding 95% for all Kuehne+Nagel employees and 99% for Kuehne+Nagel’s top and senior managers. GRI 102–16

Further, employees are trained on the principles of the Code of Conduct following risk-based considerations. Kuehne+Nagel monitors the Code of Conduct training sessions to ensure minimum participation rates of at least 95% for all Kuehne+Nagel employees and 99% for Kuehne+Nagel top and senior managers.

The Code of Conduct induction training based upon the enhanced Code of Conduct has been re-released in 2019 and made available in more than eight languages and is delivered live by in-house presenters qualified through train-the-trainer. In addition, live team training solutions for blue collar employees have been established for ensuring full inclusion. Also the online training has been updated in 2019 as per the enhanced version of the Code of Conduct and made available in eight languages. Kuehne+Nagel employees with a personalised company email account have been invited and are mandatorily required to complete the course.

Participation rates as indicated are monitored at the corporate level and statistics thereof frequently circulated to respective HR leaders for following-up on progress when lower than expected. Accordingly, any improvement will be reflected in subsequent statistics.

The mandatory Code of Conduct curriculum is complemented with live Code of Conduct on-demand training delivered by employees from the Compliance organisation following risk-based consideration.

3,100
and more employees participated in more than 170 ABC training sessions

Anti-Bribery / -Corruption and Antitrust Curriculum

Since 2014 and 2015 respectively, Kuehne+Nagel employees have been educated in annual waves of anti-bribery / -corruption (“ABC”) and antitrust (“AT”) training.

ABC training is delivered to target audiences, selected annually subject to risk-based criteria, including for example corporate, regional or country management teams and other functions such as Sales.

Overall, ABC training has been delivered to more than 3,100 employees in more than 170 sessions. ABC training in 2019 focused on training sensitive functions including global customer-facing teams and was mandatorily complemented by online training on ABC and conflicts of interest. (SDG 16.5)

Respectively, AT training has been delivered to more than 1,700 employees via more than 80 sessions.

ABC Wave Training
AT Wave Training

1,500
employees trained in the live on-demand training in 2019

On-Demand Curriculum

Additional on-demand compliance training is risk-based and delivered upon request or in response to when need was identified. The topics covered by such training extend across the full responsibility of the Compliance functions such as from Compliance updates to Integrity Due Diligence workshops.

On-Demand Compliance Training
On-Demand IDD Training

2,150
employees trained in the online training programme launched in 2019

Further, on-demand training is offered as online and live training as well as via web conferences.

Since they were started in 2017, live on-demand Compliance updates have been delivered to almost 2,500 employees – in about 300 sessions.

On-demand Integrity Due Diligence (“IDD”) workshop / training has been delivered to almost 600 employees in almost 100 sessions since it was commenced in 2017.

The on-demand Online training is offered in modules for Anti-Money Laundering (“AML”), Conflicts of Inter- ests (“CoI”), and ABC.

Since launching in 2018, almost 100 employees have completed the AML course, the CoI course was completed by almost 1,500 employees and the ABC course was completed by about 700 employees.
 

Internal Information and Communication

A communication and information platform with dedicated Compliance communities named “myKN” further enables the Kuehne+Nagel employees to be provided with tailored information or reaching out for advice. Such information can be proactively pushed or pulled on demand from the Kuehne+Nagel internal collaboration platform (myKN). (SDG 17.16)
 

Confidential Reporting and Allegation Management 

Kuehne+Nagel employees are encouraged to raise concerns over potential violations of the Code of Conduct to persons of trust within Kuehne+Nagel or via the global Confidential Reporting Line (CRL) that has been implemented for employees in countries with Kuehne+Nagel facilities in 2013. This line allows for reports on potential violations in a safe, confident, and, if desired, anonymous manner. The CRL can be reached 24 hours a day, seven days a week and is operated by an external service provider enabling reporting in more than 100 native languages – either by phone, e-mail, a dedicated web-based reporting tool or a mobile app. (SDGs 16.3, 16.5)

The Kuehne+Nagel Independent Allegation Manage- ment Committee coordinates and monitors the hand- ling and follow-up of reported allegations received through any channel. The Committee ensures con- sistent professional standards and procedures for enabling thorough independent investigations where needed. Subject matter experts are involved to ensure competent and adequate assessments, appropriate decision making, and related follow-up activities. For example, HR matters are usually clarified by the HR function with the principles of independence and unbiasedness mandatorily applied.

56
per cent 5-year average of anonymous incoming reports

The CRL has remained to be the primary source of raised concerns at a growing level over the past years reaching 69% in 2019. Reports received through other channels include paper letters, emails, and phone calls raised with persons of trust or other publicly known Kuehne + Nagel addresses.

The split of anonymous versus non-anonymous reports has slightly varied over the past year with a share of anonymous reports of 61% in 2019. While encouraging our members to report upon observed concerns, we respect anonymous reports and investigate only in the direction of issues and not into identifying anonymous reporters; thus, ensuring adequate prevention of retaliation.

66
per cent 5-year average of incoming reports received through Confidential Reporting Line

Kuehne + Nagel categorises incoming reports into HR matters, whenever the primary scope of concern appears to result from adverse effects in behaviouristics or leadership, and non-HR matters, whenever the group’s monetary assets were affected. With 71% in 2019, the majority of raised concerns remains to be in the field of HR matters.

 

Incoming reports: Confidential Reporting Line and other channels
Incoming reports: anonymous and non-anonymous reports

66
per cent 5-year average of incoming reports are mainly HR-related


The CRL has remained to be the primary source of raised concerns at a growing level over the past years reaching 69% in 2019. Reports received through other channels include paper letters, emails, and phone calls raised with persons of trust or other publicly known Kuehne+Nagel addresses.

The split of anonymous versus non-anonymous reports has slightly varied over the past year with a share of anonymous reports of 61% in 2019. While encouraging our employees to report upon observed concerns, we respect anonymous reports and investigate only in the direction of issues and not into identifying anonymous reporters; thus, ensuring adequate prevention of retaliation.

Kuehne+Nagel categorises incoming reports into either HR matters, whenever the primary scope of concern appears to result from behaviours or leadership, or non-HR matters, whenever the group’s monetary assets were affected. With 71% in 2019, the majority of raised concerns remains to be in the field of HR matters.

 

Incoming reports: HR matters and non-HR matters
Incoming reports: anonymous and non-anonymous reports

37
per cent 5-year average of cases with merit

In 2019, 320 cases (2018: 230) were reported to the attention of the Independent Allegation Management Committee resulting in 3.8 cases per 1,000 employees (2018: 2.8). GRI 205-3

Cases assessed with material impact on the Kuehne+Nagel group will be reported upon in the annual audit reports and media releases respectively. (SDGs 16.6, 16.7)

Following independent investigation whenever needed, substantiated allegations are remediated accordingly including measures such as process and control improvements or disciplinary sanctions up to termination for deterrence and preventing reoccur-rence. The number of allegations found with merit has decreased over the past years to 28% in 2019.



Compliance ensures stability driven by people and processes. We are ready.
 

 

Information Security and Data Protection


Information Security

Through the expansion of information technology systems in all business and functional units, the dependence of secure data processing on information technology increases. Kuehne+Nagel classifies the security of information technology for all scopes as one of its core business goals. Therefore, comprehensive information security management establishes requirements and rules for all areas of information technology and enables secure data processing in all operational fields.

In 2019, Kuehne+Nagel achieved the ISO 27001 certification in Germany. In that context an Information Security Management System (ISMS) was introduced to the group with a global reach. The management commitment and continuous improvement, which is embedded in the ISMS, will ensure a strategic approach to tackle information security risks. This also means that other countries will be enabled to link into the existing ISO 27001 certification by a dedicated certification scope.


Data Protection

Compliance with data protection and privacy laws is an integral part of our company’s way of conducting business in a trustworthy manner. According to Kuehne+Nagel’s Code of Conduct, all employees, directors and staff have the responsibility to comply with applicable data protection and privacy laws while safeguarding the rights of people and enabling effective business operations around the world.
 
In 2019 relevant progress was made to further improve awareness on data protection in our company. Lessons were learned from data breaches and security gaps closed. In this context, the Kuehne+Nagel data breach management procedure has proven to be solid and reliable.

At Kuehne+Nagel, we respect the privacy of all individuals that have entrusted us with their personal data. The management of customer consent was lifted to a higher level of proficiency and triggered enhancement of new and efficient ways of customer acquisition. It remains simultaneously both a challenge and a goal to foster establishment of high standards of information security and data protection on a global scale. This being said, Kuehne+Nagel understands and uses these challenges as opportunities for continues improvement of our business processes.