Integrity in Business

Quality Services

Quality first  GRI 417, GRI 416


Sustainability begins with Quality

Today, Kuehne+Nagel offers a wide range of diversi- fied customer services and solutions, from aerospace, automotive to oil & gas, forest products and wine, spirits & drinks and many more. All these industries have one thing in common – meeting their needs requires profound knowledge, skills and training to comply with customer and regulatory requirements.

To meet these daily demands, Kuehne+Nagel has built up an integrated management system encompassing all requirements and ensuring a smooth supply chain on its journey from the manufacturer to the buyer. A number of standards, initiatives and multilateral cross-border agreements enable this on a day-to-day basis.

All Kuehne+Nagel branches are compliant to the applicable parts of the integrated management system; and the majority of branches are also audited and certified externally. In 2019, Kuehne+Nagel managed 1,626 certificates covering the operations in over 1,250 branches. The main standards applied were ISO 9001 management systems in 734 certified branches and ISO 14001 environmental management systems in 508 certified branches. The Occupational Health & Safety systems ISO 45001 (former OHSAS 18001) were applied in 384 certified branches. Another 15 special management and certification standards prove the relevance of transparent processes and auditable documentation which are e.g. SQAS Chemical industry, EN9100 Aerospace, ISO 13485 Medical devices, ISO 22301 Business continuity management, ISO27001 Information Security to name some of the most relevant certifications. (SDG 17)

An important element in the past year was the certification for ISO 27001 Information Security which was significant in two aspects; as a governmental requirement to ensure and document our defined processes being adequate and compliant to national IT standards, and customer requirements to warrant and safeguard entrusted commercial data (more about ISO 27001 can be read in section Information Security and Data protection).

In parallel with the information security advancement, our efforts also focused on upgrading current business continuity management in all our branches worldwide to ensure optimal response time in case of an emergency that requires special attention, clear leadership and communication.

The result of a stable framework can be underlined by the 437 customer and 121 authority audits executed in 2019, with no critical findings. 104 supplier audits have been conducted globally on a risk based assessment level. The majority of the supplier audits were conducted with reference to pharma, food and aerospace business. (SDG 12 and 17)

Confidence and control

Through regular internal audits, day-to-day business conduct is being verified by structured review and assessments of processes and risks to avoid damage or loss to business. These audits vary from branch size, business volume, complexity and products handled to ensure customer satisfaction. In the past year, 770 site audits were conducted in 87 countries.

Through our non-conformity reporting tool, 13,019 reports (2018: 13,400) were triggered to improve the current processes with the aim to reduce waste, redundancies and cost of obsolescence. (SDGs 9)

The two main categories in focus were pharma & healthcare and operational procedures.

Values for customers

Based on the group’s strategy, Kuehne+Nagel offers tailor-made customer solutions for industries like pharma & healthcare, perishables, aerospace and others. These customer solutions are called KN PharmaChain, etc. to ensure that dedicated and standardised procedures, regulatory requirements and documentation is established and employees are trained and qualified to manage in case of recalls or contamination of products may have occurred and market withdrawal is required. (SDG 4, 9, 17)
During 2019 no such incident was recorded. 


Occupational Health and Safety  G 403-1, G 403-2, G 403-4, G 405-5, G 403-7

The HSE-app was introduced in 2018 to support easy and fast reporting of unsafe acts and unsafe conditions in several countries.
 
At the end of 2019, 41 countries were using the app and 1,274 employees have been registered onto the app.

Due to its easy usability, the HSE-app has resulted in a significant increase in reported unsafe situations. As none of these situations had led to an incident, learning from these situations reduces the likelihood of incidents happening. This is reflected in the HSE-performance – which reflects a steady decrease in employees getting injured at work, providing a safe and secure working environment. (SDG 8)

The HSE-app will be extended with a dashboard and incident investigation module in 2020 and made ready for full roll-out within the company.
 

Raising awareness among the staff for NO HARM training

In Kuehne+Nagel’s continuous effort to get to the level of NO HARM, more employees were trained in recognising hazards in the workplace and what to do to if an unsafe situation is seen. This STOP Work Authority Program (SWAP) is extended to not only Kuehne+Nagel employees in warehouses, but also some of its suppliers, and third-party employees. Some countries started NO HARM training for their office employees already. (SDGs 3D, 4.7)

To recognise positive observations of a job well done or excellent workplace situation, the HSE-app has been extended with a “Positive Observation” button. This has already resulted in 277 reported positive observations in 2019.

In the reporting period the Lost Time Incident Frequency decreased less than the Total Reportable Case Frequency, but both continue on a downward trend.

 

Kuehne+Nagel Group
  2019 2018 2017
Number of fatalities (FAT) 1 2
Lost time injury frequency (LTIF) 1 13.22 13.73 3 15.93
Total reportable case frequency (TRCF) 2 17.66 19.55 3 19.30
Lost workday cases (LWC) 2,434 2,368 3 2,429
Lost workday (LWD) 41,733 40,568 3 47,954 3
Unsafe act / Unsafe condition 43,522 22,727 7,833

1  LTIF – The number of LTI’s per 1,000,000 working hours
2  TRCF – The number of TRC’s per 1,000,000 working hours
3  Discrepancy to 2018 numbers (in previous report) due to rectification after reporting

 

 

Despite the aim to prevent any harm in 2019, Kuehne+Nagel contracted suppliers incurred fatal accidents.

In June 2019, in Indonesia, a chartered truck was hit by a bus coming from the other side of the dual carriage way. The co-driver was fatally injured. In the same month, in South Africa a third party employee (on third party premises) was fatally injured during offloading activities, which were under Kuehne+Nagel control.

The month after, in France, a third party employee was fatally injured whilst doing maintenance work on an FLT consignment in our premises. August was the last month in 2019 with a fatality. In Germany, a STUTE employee was fatally injured whilst maneuvering a steel coil into a cutting machine.

Corporate, regional and national management is informed of every single fatality, Kuehne+Nagel employees or 3rd party. Respective investigations are triggered and collaboration with authorities conducted to ensure lessons learnt are communicated and trained, with underlying causes corrected. We deeply regret these incidents and send our heartfelt condolences to the families.
 

 

Safety Pyramid
 

 

In 2019, Kuehne+Nagel continued with the “Get Home Safe” campaign by training employees (more than 1,000 trained in defensive driving). A campaign was introduced in the Asia Pacific region, where the focus is on wearing seat belts. (SDGs 3.6, 4.7)

Kuehne+Nagel Italy organised a training in 2019, which included an awareness session on the theory of defensive driving, followed by a practical phase where each driver had the opportunity to perform safety tests on the road. The courses were held in October and November in 2019, with seven sessions, 64 participants and 512 hours of training counted. This project will continue in 2020.

 

 

92 warehouses around the world with 1,000 days without an accident in 2019

 

North America

USA
MD – Baltimore
OH – Cleveland
OH – Columbus
MI – Detroit
NC – Durham
SC – Greenville
TX – Houston
VA – Washington Dulles
IN – Indianapolis
IND – Ind – Apria
CA – Los Angeles
TX – Laredo
KS - Lenexa – Apria
TN – Memphis
MA – Mansfield
CA – Ontario
IL - Des Plaines
FL – Orlando
IN – Plainfield
IN – Plainfield
CA – San Francisco
PR – San Juan
UT – Salt Lake
MO – Saint Louis
GA – Apria – Suwanee
CA – Torrance
AZ – Tucson
TX – McAllen
OH – Urbana
CA- San Diego

Mexico
Tijuana
Leon

Canada
Milcree

South America

Brasil
Guarulhos
Canoas
Embu das Artes
Indaiatuba

Colombia
Natura

Middle East & Africa

Jordan
Zarqa

United Arab Emirates
Dubai

Europe

Austria
Vienna
Salzburg

Bulgaria
Sofia

Switzerland
Gottmadingen

Spain
Alicante

Ireland
Shannon

Macedonia
Skopje

Norway
Stavanger
Bergen

Romania
Timisoara
Cluj
Bacau

Russia
Moscow (Kuzyaevo)
Moscow (DME)
Olgino
Yuzhno-Sakhalinsk

Ukraine
ITG Kiev
Chaiky I
Chaiky II
Brovary
Gostomel (Hostomel)
KHU

Asia Pacific

China
East China:
Shanghai
Ningbo
North China:
Tianjin
Beijing
Dalian
South China:
Hong Kong
Shenzhen

Korea
Incheon

Australia
Altona North
Chullora

India
Bilaspur
Jammu
Srinagar
Pondicherry
Chennai

Japan
Narita
Ichikawa
Rinku

Malaysia
Kuala Lumpur

Thailand
Rayong
Chonburi
Samutprakan

Vietnam
Binh Duong
Bien Hoa
Thu Dau Mot
Da Nang
Phu Chuan
Hai Phong

Security moment  GRI 418-1

14,089
white & blue collar employees trained in security awareness

Kuehne+Nagel has developed and implemented a web-based incident reporting application in 2018. Following the company’s strict zero tolerance security policy, any security incident or attempted security incident will be subject to reporting, irrespective of the loss value encountered. In the course of achieving certification to ISO 27001 Information Security Management, Kuehne+Nagel expanded the scope of the web-based incident reporting application to include theft of any IT devices, with the subsequent workflow informing Kuehne+Nagel’s cyber security desk in real time (SDG 9)
 
Crime trends see an increasing sophistication in organised crime, enabling attacks on highly secured vehicles transporting valuable loads. As a consequence, in 2019, Kuehne+Nagel recorded an increase in commercial loss values for the first time despite decreasing incident numbers (-19%).

Kuehne+Nagel developed an internal certification standard for customers with enhanced security requirements. This certification standard is built on the provision of Security Management System for Supply Chain (ISO 28001). The current network consists of 55 certified locations across all Kuehne+Nagel regions.

 

In Mexico, armed hijackings of trucks have been successfully reduced by almost 50 per cent.
 

Number of Incidents


Over the years, Kuehne+Nagel stabilised the number of security / theft incidents to a stable level. With that statement, it was also recognised that organised crime is focusing on carrying out single major impact incidents, with increasing commercial loss values. To fight the likelihood of recurrence, Kuehne+Nagel closely monitors changes in threat levels and emerging modus operandi with authorities and customers to implement suitable countermeasures. One example is the Implementation of enhanced security installations on subcontractor truck fleets in Mexico that allowed for 44% of attempted armed hijacking cases to be repelled, thus safeguarding from violence and theft.
 

19
per cent decline in number of incidents

Highlights for 2019

  • Number of incidents declined by 19% compared to 2018; commercial loss value increased by 27%. This was caused by one single security incident.
  • Kuehne+Nagel participated in designing a new certification standard for safe and secure parking places in Europe in collaboration with the European Commission.
  • Kuehne+Nagel Thailand and Bolivia certified for AEO. Totaling 39 AEO certified countries.
  • Strong collaboration with law enforcement agencies led to dismantlement of a network involved in trafficking of illicit substances and subsequent arrest of involved perpetrators.

4,408
employees having received an internal Dangerous Goods training listed in my learning (Road/Sea/Air)

118
employees having received other Dangerous Goods internal training not listed in my learning (Road/Sea/Air)

Dangerous goods  GRI 403

In 2019, Kuehne+Nagel has continued to strengthen its network of dangerous goods specialists under the motto: “No Dangerous goods transport, without prior review by a qualified expert”.
 
Currently, the company already has over 2,800 qualified dangerous goods safety advisors in place for all modes of transport, and more than 7,000 employees have received dangerous goods function-specific or awareness training.

The measures adopted for the continuous improvement of the dangerous goods management within Kuehne+Nagel are, however, not limited to transport activities. Equally important are the safe handling and storage of hazardous substances articles, often subject to complex national and local legislation. GRI 417

For this purpose, a subject matter expert has been designated for each country in which Kuehne+Nagel carries out logistics activities who, with the assistance of local dangerous goods safety advisers, will ensure that all legal and safety requirements are met.

Thanks to the global Incident Reporting Tool implemented in 2018, each incident involving dangerous goods is immediately known and corrective measures, lessons learned and security alerts can be quickly broadcasted through a very active dangerous goods community within the company‘s intranet.

Despite the large amount of freight carried by Kuehne+Nagel in 2019, only four relevant incidents involving dangerous goods were reported. Thanks to the correct application of the existing spillage procedures, none of them caused any personal injury. However, in three of the cases, the release of chemical substances into the adjacent environment could not be avoided, requiring limited subsequent cleaning and decontamination measures. GRI 306-3

After an exhaustive investigation, the spillage procedures were updated to improve the protection measures for drains and sewage systems and to contain large leakages more efficiently.

 

Dangerous Goods Incidents 2019  GRI 306-3
Location Country Date Description Est. spill costs in TCHF Spill volume Damage to Environment Damage to Persons
Ilsfeld DE 2 Apr. Spill from IBC container to the river* n/a 1,000 litres Yes No
Dallas US 12 Jul. Spill from the container to separate water retention pond 13.73 50 Yes No
Hauneck DE 29 Sep. Damage of plastic bags with toxic solids 19.55 n/a Yes No
Derbyshire UK 13 Oct. Theft incident of diesel causing spill   100 Yes No

*  No hazmat but condensed alcohol-based solution

 

3,019
employees having received external Dangerous Goods training (Road/Sea/Air)

While there is a rising eco-consciousness in society, in many parts of the world it is still required to support awareness on the importance of sustainable development, which includes proper recycling and disposal of hazardous waste.

To contribute to this goal, Kuehne+Nagel has launched in 2019 the “hazardous waste awareness campaign”. This pilot experience carried out in a selected group of countries, aims to educate KN employees and collaborators to correctly identify, separate and recycle or dispose hazardous waste generated at the company’s own premises and, where possible, promote greener alternatives. The materials collected include everyday hazardous articles, such as cleaning products, aerosols, paint, or batteries. (SDGs 12, 13)

With this project, Kuehne+Nagel is seriously committed to contributing to raising environmentally friendly behaviors in societies where currently this is not yet the norm.