Relevant GRI Indicators

NF5 Compliance

The compliance work during 2022 was heavily impacted by the sanctions against Russia and the decision to pause and later wind-down all Sandvik business operations in and with the country. In response to the developments, several approval processes were developed, updated and implemented.

The ever-increasing complexity of the regulatory, global landscape also resulted in a key focus on our digital journey and to further develop our data-driven, risk-based approach to enable better decision making. In 2022, we introduced an app-based solution for Conflict of Interest Management. It is the first step in delivering a more streamlined, transparent and secure process for managing some of the key compliance risk areas.

The Compliance House – a tool enabling, among other things, each entity to understand and work with its own compliance risks and increasing transparency around the implementation of controls – continued to be highly prioritized as a cornerstone of our Group Compliance programs. In 2022, the tool was further operationalized and embedded in the line organization. At year-end 2022, all business entities were included in the tool, except a few recently acquired entities which were assessed for compliance risks in the due diligence process, and certain entities which mainly perform administrative tasks and internal services and hence are considered low risk. 357 (92 percent) of the operational units in the tool revised their self-assessment during the year. The Compliance House also requires each entity to communicate to its employees annually on anti-corruption, competition law and data privacy. As of December 31, 2022, 94 percent of the entities responded that they had fulfilled their anti-corruption communication. The corresponding figure for competition law and data privacy communication were 93 percent and 92 percent, respectively.

Compliance training was offered to employees in different formats, including e-learning, webinars and classroom training. More than 16,282 training records were created, whereof 4,169 were in anti-corruption, 3,894 in competition law, 5,638 in data privacy and 2,581 in sanctions and export control. During 2022 all members of the Group Executive Management participated in an anti-corruption dilemma training.

Sandvik has zero tolerance for bribery and corruption and in 2022, Sandvik reviewed and updated its Anti-Bribery and Corruption policy. It requires all employees and directors to identify and disclose any conflicts of interest. The risk assessment through the Compliance House did not, considering action plans and controls in place, result in any significant residual corruption risks. While Sandvik does not require its business partners to comply with Sandvik compliance policies and procedures, it deploys a supplier/business partner Code of Conduct which requires the supplier/business partner to comply with relevant rules and principles related to anti-corruption, competition law, data privacy and international sanctions. New and updated Supplier and Business Partner Codes of Conduct were launched in 2021 and continued to be rolled out in 2022. Sandvik also requires that relevant commercial intermediaries sign an anti-corruption and export control/trade clause in the contract. The use of the anti-corruption clause and the Business Partner Code of Conduct is followed up through the Compliance House. 63 percent of the entities using commercial intermediaries responded that all their commercial intermediaries had signed the Sandvik Business Partner Code of Conduct and that 60 percent that all commercial intermediaries had signed a contract including an anti-corruption clause. The entities’ responses are audited and confirmed by the Internal and External Audit functions as part of the regular audit programs.

During 2022, Sandvik received and responded to questions from Inspektionen för Strategiska Produkter following media reports focusing on past sales to companies in Russia’s military industry. This matter was dismissed without further actions. Otherwise there were no major public legal cases regarding potential non-compliance with laws and regulations brought against Sandvik and neither did Sandvik receive any significant fines or non-monetary sanctions for non-compliance with laws or regulations.