ESRS Standard
ESRS Standard
The term"Policy" is synonymous with the term"Policy", which is used within the German version of the ESRS Standard.
39 The company shall disclose the time-bound and results-oriented Targets it may have set in relation to the following:
(a) Reducing negative impacts on workers in the Value chain; and/or
b) Promoting positive impacts on workers in the value chain; and/or
c) Managing Material risks and opportunities related to labor in the Value chain.
40. the objective of this disclosure requirement is to provide an understanding of the extent to which the company uses time-bound and outcome-oriented Targets to drive and measure its progress in addressing its material negative impacts and/or in driving positive impacts on workers in the value chain and/or in managing Material risks and Opportunities associated with workers in the value chain.
41 The summary description of the Targets for the management of Material Impacts, Risks and Opportunities related to labor in the Value chain includes the information requirements set out in ESRS 2 MDR-T.
42 The company shall disclose the process for establishing the Targets, including information on whether and how the company has engaged directly with workers in the Value chain, their Legitimate representatives or Credible proxies who have insight into their situation in the following areas:
(a) Establishing these Targets,
b) Tracking the company's performance in relation to the achievement of these Targets; and
c) identifying insights or opportunities for improvement arising from the organization's performance.
Application Requirements (AR)
Application Requirements (AR)
AR 45 When disclosing information about Targets in accordance with paragraph 39, the entity may disclose the following:
(a) the intended outcomes in terms of the lives of workers in the Value chain (as specific as possible),
(b) the long-term stability of Targets in terms of definitions and methodologies to enable comparability over time,
c) the standards or commitments on which the Targets are based (e.g. codes of conduct, sourcing policies, global frameworks or industry codes).
AR 46 Targets related to Material risks and Opportunities may be the same as, or different from, targets related to Impact materiality. For example, a target to achieve living wages for workers in the supply chain could reduce both the Impacts on that supply chain and the associated Risks to the quality and reliability of its supplies.
AR 47 The entity may also distinguish between short-, medium- and long-term Targets for the same commitment made under the Policy. For example, the company may have a long-term target to reduce health and safety incidents affecting a particular Supplier 's workforce by 80% by 2030 and a short-term target to reduce delivery workers' Overtime by x% by 2024 while maintaining their income.
AR 48 When amending or replacing a Targets during the reporting period, the entity may clarify this by cross-referencing to significant changes in the business model or broader changes in the accepted standard or regulatory framework from which the Targets are derived to provide background information in accordance with ESRS 2 BP-2 Disclosures in the context of specific circumstances.
Examples from practice
Examples from practice
Examples are provided only as an indication of how a disclosure requirement has been reported by other entities. Audited ESRS reports are not yet available. There is no guarantee of accuracy and completeness.
S2-5 - Targets for the protection of workers in the Value chain
Sustainable supplier management and risk assessment
We pursue a clear strategy to promote sustainability in supplier management. We place particular emphasis on respecting human rights, protecting occupational safety and implementing a transparent evaluation process for all suppliers. Our actions are aimed at direct suppliers as well as subcontractors and indirect suppliers.
Materiality Targets by 2025:
Establish a comprehensive human rights risk assessment:
We conduct risk assessments of subcontractors and suppliers at Tier 2 level to identify potential human rights violations at an early stage and take appropriate actions.Prevention of serious accidents:
Our aim is to completely eliminate the risk of fatal accidents, both at our company and at our suppliers, by introducing and continuously monitoring stricter safety standards.Sustainability assessment through ESG ratings:
Suppliers with an annual purchasing volume of over 150,000 euros will be required to submit an ESG assessment through EcoVadis or an equivalent system. Among other things, this assessment covers the areas of labor rights and human rights.Strengthening sustainability through binding standards:
By 2025, all suppliers are to accept our Code of Conduct and meet the defined minimum requirements in terms of sustainability and compliance.
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