Alwin Kolb GmbH & Co. KG and its aforementioned companies take appropriate and effective measures to identify and verify the human rights and environmental risks defined by the LkSG in its own business area and in the entire supply chain and to prevent the realization of risks. If it is determined that a violation of a human rights or environmental obligation has occurred or is imminent, a targeted remediation process is put in place as part of which individual measures are taken to end a violation and minimize its consequences.

All measures taken as part of our human rights and environmental responsibility follow the principle of „empowerment before retreat“: We are committed to supporting our business partners in avoiding and ending violations of human rights or environmental regulations before we abandon business relationships or switch to alternative sources of supply.

Effective risk management

The risk management system establishes processes for implementing the due diligence obligations and defines areas of responsibility, competencies and reporting lines.

The due diligence obligations are anchored horizontally within the company. All relevant departments – management, quality management, purchasing, human resources and finance – are involved in the implementation steps. The implementation of the due diligence obligations is managed operationally by the Purchasing department. In accordance with Section 3 (1) No. 2 LkSG, it is responsible for risk mitigation measures and reviews the effectiveness of the internal control and risk management systems as part of regular and ad hoc audits.

The due diligence obligations are anchored horizontally within the company. All relevant departments – management, quality management, purchasing, human resources and finance – are involved in the implementation steps. The implementation of the due diligence obligations is managed operationally by the Purchasing department. In accordance with Section 3 (1) No. 2 LkSG, it is responsible for risk mitigation measures and reviews the effectiveness of the internal control and risk management systems as part of regular and ad hoc audits.

Due diligence obligations are anchored vertically by defining supervisory and coordination responsibilities at management level. Overall responsibility for the implementation of human rights and environmental due diligence obligations lies with the management.

Alwin Kolb GmbH &. KG has appointed a human rights officer for itself and its companies in accordance with Section 4 (3) LkSG, who monitors risk management for its own business area and the entire supply chain and carries out regular effectiveness reviews. Together with the Purchasing and Human Resources departments, the Human Rights Officer works on the ongoing development of the catalog of measures for compliance with due diligence obligations. The Human Rights Officer reports directly to the Management Board.

a.         Identifying, weighting and prioritizing risks

The company carries out comprehensive risk analyses with regard to compliance with human rights and environmental obligations within its own business area and at its direct suppliers. In doing so, we draw on both internal and external expertise. The complexity and scope of our international supply chain require the use of technical solutions that support us in identifying, verifying, weighting and prioritizing risks.

Our risk analysis system enables us to determine the individual risks of each business partner. On the basis of general supplier information – in particular country of origin and industry – an abstract risk analysis is carried out based on a large number of recognized indices and studies by external experts. We then check business partners for specific human rights or environmental risks on the basis of supplier self-assessments, verified certifications and our own findings from inspections or business processes. This not only takes into account the business partner’s country of origin and sector. We also analyze product risks, trading level risks, the complexity of upstream supply chains and a wide range of other data in order to narrow down, localize and identify risks at an early stage.

We weight and prioritize risks by comparing the typically expected severity of a possible legal violation and its irreversibility with the probability of occurrence. We also take into account our own possible contributions to causation and the degree of our influence in order to prioritize risks and take targeted action where there is a threat of risks materializing. We use a risk matrix to identify our need for action and initiate preventive and remedial measures where they are necessary.

b.         Taking preventive action

The comprehensive risk analysis is supplemented by appropriate and effective preventive measures.

An internal code of conduct applies in our own business division, which clearly and comprehensibly summarizes the expectations and rights of employees.

We carry out regular and ad hoc checks in our own business area in order to identify and minimize risks at an early stage. We monitor business partners within the scope of legal possibilities and requirements. In particular, direct suppliers are subjected to a careful review before entering into new business relationships.

We require business partners to pass on our human rights and environmental expectations in the supply chain and to monitor compliance on an ongoing basis. To this end, our Sustainable Procurement Guideline for Suppliers dated April 2024 forms the basis for entering into a new business relationship.

c.         Take remedial action

Effective remedial action shall be taken when a violation of a human rights or environmental obligation occurs or is imminent.

We initiate remedial action immediately after identifying a relevant violation. We develop tailor-made remedial measures for each situation and each direct or indirect supplier in order to put an end to violations in a targeted manner. At the same time, we have developed a series of framework measures that can be activated immediately in the sense of a modular principle and filled with specific content to respond to violations.

For each corrective measure, we define a process, success targets and clear internal company responsibilities. Each corrective action contains a concrete schedule and can be provided with interim targets. The system-supported action processes link all relevant players.

d.         Follow up on tips

An important role in identifying risks and violations in the supply chain is played by a functioning complaints procedure that is accessible to all those affected in the supply chain – from employees and suppliers to third parties who are affected by our activities or those of our suppliers. It is important that reports can be submitted anonymously and confidentially.

Our digital whistleblowing system takes into account the complexity of our supply chain. Any access threshold is set low in order to make the submission of reports as easy as possible.

Reports are handled confidentially and swiftly. The employees involved in processing complaints are not subject to any instructions as part of the complaints management process; their neutrality is guaranteed. Every complaint triggers an evaluation and action process, at the end of which the reported violation is ended or an identified risk is minimized.

Information and complaints submitted are also taken into account as part of the risk analysis.

e.         Documentation and reporting

The implementation of all due diligence obligations is documented on an ongoing basis. We use a central risk management system to network all information available to us on identified risks and preventive and remedial measures taken.

We are also committed to transparent communication on the human rights and environmental challenges to which we are exposed. Through our public reporting, we communicate identified risks, measures taken and progress made at least once a year.