Due diligence and risk management
The VanDrie Group wants to produce high-quality, safe and nutritious veal and beef products, calf feed, raw dairy materials and high-quality calf skins. Furthermore, we need to meet the standards that are expected of us and are in keeping with our social position and responsibility. We realise that we must set a good example and act ethically.
As a producer, however, we are confronted with a wide range of risks, from raw material to end product and with all activities in our value chain. These risks cannot be avoided completely. That is why we apply a Due Diligence approach. This is the process by which we identify actual and potential risks. It subsequently offers us the opportunity to make well-considered decisions about (managing) the identified risks. We carry out our Due Diligence in line with the Guidance on Corporate Social Responsibility (CSR) which is based on the OECD Guidelines for Multinational Enterprises. Below you will find a diagrammatic overview of the most important identified risks for our organisation and a non-exhaustive summary of control mechanisms that were implemented in 2021.
Strategic Risk as a theme: Human rights
Observing fundamental rights in the value chain.
Identified risks | Results | Risk indicators | Management control mechanisms 2021 |
Discrimination, violence, sexual intimidation, transgressive behaviour | Breach of statutory and social standards | Reports whistle-blowing scheme and confidential advisers | The ‘SpeakUp’ whistle-blowers' scheme is made available to employees, customers and suppliers and enables abuses to be reported easily, anonymously and in one’s own language. Companies have designated confidential advisers. |
Child and/or forced labour | Loss of good reputation | Adverse media | Our practice for doing business fairly was developed. |
Failure to involve local communities that may be affected by the company's activities. | A Code of Conduct (in 11 languages) was shared with employees. | ||
Daily monitoring of adverse media. | |||
Internal audit of raw material suppliers has taken place. | |||
Various annual stakeholder meetings and local consultations with governments and interested parties were organised. |
Information security
Ensuring information security, preventing data breaches and complying with privacy regulations.
Identified risks | Results | Risk indicators | Management control mechanisms 2021 |
Data breaches | Undermining of confidential data and breach of internal operational processes | Stress tests of ICT systems | Awareness training courses for employees carried out. |
Cybercrime (e.g. hacks or hijacking) | Reports under privacy regulations | ||
Breaches of privacy legislation |
Environment
Protecting the ecosystem.
Identified risks | Results | Risk indicators | Management control mechanisms 2021 |
Exceeding biological, chemical or physical legal values when performing activities or services | Impairment of the ecosystem and biodiversity | Results of ISO-14001 audits (requirements for effective environmental management system) and/or environmental permits | Certification of all our production companies to the ISO 14001 standard. |
Air or soil pollution in immediate surroundings of production locations | Lab studies into biological and chemical risks from individual subsidiaries | Purchasing raw materials in accordance with sustainable sectoral agreement, such as the Soy Sourcing Guidelines of the European Feed Manufacturers’ Federation (FEFAC). | |
Innovation processes to reduce emissions within the chain. |
Unlawful behaviour
Preventing corruption, bribery or competition breaches.
Identified risks | Results | Risk indicators | Management control mechanisms 2021 |
Bribery of government officials | Breach of statutory and social standards | Reports under the whistle-blowing scheme | Employees are regularly informed about our standards of conduct and rules governing competition and corruption policy. |
Making prohibited market agreements | Loss of business trust | Active monitoring and regular checks by finance departments | Active monitoring of compliance themes (legislation and regulations, adverse media) |
Regular screening of EU and OFAC sanction lists. | |||
Tax evasion, fraud, corruption or otherwise | Audits by accountant | ||
We regularly test our invoicing to ensure the correctness of payments in order to prevent money laundering. |
Consumer interests
Safeguarding food safety and providing honest production information and fair pricing.
Identified risks | Results | Risk indicators | Management control mechanisms 2021 |
Products that do not meet standards (food safety standards, health warnings or security information) | Breach of statutory and social standards | Results of permanent monitoring by national regulatory authorities | The Safety Guard quality system is active. Safety Guard is based on the ISO 22000 and 14001 standards, the Food Safety Supply Chain System and the BRC, IFS and GMP+ quality schemes. |
Misleading representation of information | Damage to health in the event of consumption | Results of internal and external audits | Customers purchasing meat products are given Safe Handling Instructions. |
Increasing chain cost price due to scarcity and rising prices of energy and raw materials | Loss of consumer trust | Lab tests of food safety indicators | We work in line with the United Nations Guidelines |
for Consumer Protection. | |||
Earning capacity under pressure |
Employment and industrial relations
Rights of employees and guaranteeing good working conditions.
Identified risks | Results | Risk indicators | Management control mechanisms 2021 |
Undesirable physical/mental burdening of employees | Breach of statutory and social standards | Absence due to sickness and turnover within organisation | The companies have a risk inventory and evaluation (RI&E) and regularly carry out updates. |
Animal welfare
Preventing infringements of animal health and welfare.
Identified risks | Results | Risk indicators | Management control mechanisms 2021 |
Comply with absenteeism legislation and regulations regarding transport, husbandry, feed, medicines or otherwise | Non-compliance with the principles of humane husbandry | Inspections by the Independent Foundation for Quality Guarantee of the Veal Sector (SKV) | Animal Welfare Officers (AWO) carry out monitoring at meat processing companies at all times. |
Violation of the intrinsic value of animals | Animal suffering | Use of antibiotics and dropout rates | Transporters and veal farmers are trained/informed about animal behaviour and the humane handling of animals. |
Reports under the whistle-blowing scheme | SKV carries out monitoring of legislation with regard to animal welfare, transportation and the use of antibiotics. All of our veal farmers in the Netherlands are certified under the Vitaal Kalf (Fit Calf) quality scheme. | ||
Camera surveillance |
Risk awareness
Managing risks is part of the control and decision-making process of the VanDrie Group. The Management Board discuss the risks on a regular basis. They assess what effects the risks may have on the external environment, the strategic objectives, the business operations and on our reputation. We know that we cannot completely remove risks. We weigh up the probability that the risk will occur against the consequence of the effect. Our guiding principles with risk management are:
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We don’t want to take any risks when it comes to the safety of our employees and our products. We rule out all risks, in so far as that is possible and realistic.
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We must comply with legislation and regulations and want to act in accordance with our values and our code of conduct.
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We seek the right balance between financial and commercial risks and our objectives in the longer term.
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We want to have a healthy financial basis and meet the financial ratios that are important to us.
Information security
Information security
Equal
In an increasingly digital working and living environment, information security continues to demand attention. The impact in the event of a breach is great, such as productions processes that come to a halt due to cyberattacks.
Environment
Environment
Increasing
Attention for climate and biodiversity has grown considerably. The VanDrie Group has a responsibility to take herein. The assessment is that there are risks with regard to this topic, especially as far as the effective handling of nitrogen and CO2 is concerned. The impact of this is assessed to be considerable.
Consumer interests
Consumer interests
Equal
A food producer must do everything it can to make safe products and provide honest information about that. Violations of this lead to serious consequences: recalls, potential illnesses and the loss of trust and reputation.
Animal welfare
Animal welfare
Increasing
The intrinsic value of animals must be protected. That is our duty. Violations of this lead to pain or harm to the animal. In addition, we see that the social focus on this is growing.
Employment and industrial relations
Employment and industrial relations
Equal
Although the attention for this topic has increased substantially in recent years, this trend is now assessed as stable and the risk of violations as unlikely. The potential risk is assessed as small.
Human rights
Human rights
Increasing
The justified attention for human rights and the role of companies therein is growing. The consequence of a breach is considerable and may have an even more serious impact per individual case.
Unlawful behaviour
Unlawful behaviour
Increasing
Although we assess the probability of this risk as unlikely, the impact if it occurs is serious for the VanDrie Group or individual employees.
Link to strategic themes
Our market position | Sustainability | Food safety | Animal health and welfare | Good employment practices | |
Human rights | x | x | |||
Information security | x | ||||
Environment | x | ||||
Unlawful behaviour | x | ||||
Consumer interests | x | x | x | ||
Employment and industrial relations | x | ||||
Animal welfare | x |