Plastic Omnium - 2020 Universal Registration Document

STATEMENT OF NON-FINANCIAL PERFORMANCE The ACT FOR ALL TM program PLASTIC OMNIUM UNIVERSAL REGISTRATION DOCUMENT 2020 153 The fight against tax evasion Due to its presence in 25 countries, Plastic Omnium is subject to a significant number of often complex tax regulations, the structure and interpretation of which are likely to generate risks. The Group has therefore defined a certain number of principles that govern its tax policy: Compliance with the laws and regulations in force in the countries in ● which it operates, including the filing of tax returns and making the required payments on time; A commitment not to create subsidiaries in so-called “non-cooperative” ● countries or to use structures lacking economic substance; The implementation and regular updating of a transfer pricing policy in ● line with the arm's length pricing principle; Building constructive and professional relationships with tax ● authorities. Thus, Plastic Omnium has committed to the tax partnership with the French tax authorities; The Group publishes a list of its consolidated subsidiaries and provides ● the French tax authorities with a country-by-country tax declaration. The tax policy is approved by Senior Management, on the proposal of the Group Tax Department, which is responsible for implementing it, in collaboration with the local finance departments, under the supervision of the business lines. DUTY OF VIGILANCE AND SUSTAINABLE 4.6.1.2 PURCHASING Law no. 2017-399 of March 27, 2017 relating to the duty of vigilance of parent companies and ordering companies requires large companies to develop, publish and implement appropriate measures to identify risks and the means to prevent violations of human rights and fundamental freedoms, human health and safety and the environment. Because of its international presence and complex structure, Plastic Omnium must be vigilant about the potential consequences of the businesses and behavior of its subsidiaries, suppliers, subcontractors and service providers on the Group. A failure of one of its suppliers could impact the Group’s operational businesses, its economic performance, reputation and compliance. In March 2020, Plastic Omnium created the position of Vice President responsible for Group Purchasing Performance. Sustainable purchasing is one of his missions, as he is responsible for taking actions within the Purchasing function to strengthen the social responsibility of the supply chain and, in particular, to reduce its carbon footprint. Risk Mapping 4.6.1.2.1 The risk mapping is performed at two levels in order to have a realistic and relevant assessment and for all the Business Lines, the latest dates from 2019 with HBPO: at Group level: the annual review of the risk mapping makes it possible ● to identify all of the risks borne by the Group. Risks related to suppliers and subcontractors are incorporated into this analysis. In addition, the updating of the materiality and risk analysis performed in 2020 enabled, through interviews with internal stakeholders, the social, corporate and environmental risks faced by the Company to be identified. The analysis was carried out by analyzing risks from a financial, operational, reputational and legal point of view. In addition, these risks have been submitted to external stakeholders in order to identify the risks to which the Plastic Omnium Group is exposed as a result of their businesses. The Group’s risk mapping is presented in section "2.1 Main risk factors" and the non-financial risks and opportunities are presented in section "4.3.1 The review of the materiality analysis"; at the local level: these analyses are intended to be appropriate to local ● specifications. Plastic Omnium’s international presence presents different situations and regulations. Discussions with management and local teams were key to providing an analysis of the relevant risks. The risks identified were: risks related to human rights and fundamental freedoms: these are ● dealt with in the Internal Audit framework, which ensures in particular that employees’ working hours are respected and that child labor is not used; risks related to climate change: measuring its overall carbon footprint ● and carrying out life cycle analyses enables the Group to identify the businesses that are most exposed to regulations and the expectations of clients, end-users or the financial markets. These risks are addressed as part of the Top Planet Program, in the implementation of eco-design initiatives and in the development of clean mobility solutions; health and safety risks: social climate surveys and the monitoring of ● HSE teams make it possible to draw attention to working conditions, psychosocial risks and health and safety. ISO 14001, ISO 50001 and ISO 45001 certifications require a risk mapping for each certified site. These analyses make it possible to score the risks and identify the actions implemented locally to prevent and correct potential breaches. The risks identified relate to all environmental issues (consumption of raw materials, discharges and pollution, chemical products, waste and attention to biodiversity, etc.) and health and safety issues (accidents, occupational illnesses and psycho-social risks, etc.). Top Safety visits also provide an opportunity to raise risk situations so that prevention, reduction or corrective action can be taken quickly. Plastic Omnium has classified its supplier risks according to the level of its relationship with the Group. Suppliers belong to three distinct categories: strategic products (BOM purchases – Bills of Materials: raw materials or manufactured by-products used in the product); suppliers of services and investments (machines, equipment, etc.); and suppliers of services and goods not used in products (so-called “indirect” purchases). New suppliers are admitted only if they meet certain criteria, measured during an assessment audit: quality, financial robustness, sustainability performance (human rights and fundamental freedoms, health/safety, environment). Compliance with regulations and international standards are the minimum requirement. Service providers acting on behalf of Plastic Omnium as intermediaries, categorized as indirect suppliers, are regularly monitored as they may be particularly exposed: customs brokers and agents for obtaining licenses, permits or other authorizations, for example. In 2020, supplier risk was also addressed under business continuity. In this respect, the lockdowns put in place around the world to guarantee the health and safety of populations have considerably magnified certain risks with two types of impact: image impact: Plastic Omnium’s reputation may be affected by ● behavior that does not respect human rights regarding health and safety measures throughout the value chain; operational impact: a failure in the manufacturing chain can disrupt ● supply.