Wärtsilä Corporation Annual report 2014


Wärtsilä is committed to carrying out its business in a sustainable way. In order to promote the long-term interests of Wärtsilä and its stakeholders, the company strives to maintain the highest legal and ethical standards in all its business practices. All business and other activities of Wärtsilä shall be carried out strictly in compliance with all applicable laws and under the principles of good corporate citizenship in each country where such activities take place. This requires all employees to act responsibly and with integrity and honesty.

Wärtsilä is committed to ensure compliance with Wärtsilä Code of Conduct in all of its business operations globally and therefore has established a group policy for reporting misconduct incidents and suspected Code of Conduct violations. Wärtsilä employees are encouraged to voice their concerns as to potential violations of the code and its underlying policies and instructions. The reported misconduct cases are investigated either locally or centrally, as appropriate. The primary way to report suspect misconduct incidents is through the line management but employees also have alternative reporting routes, including anonymous reporting, directly to compliance function or to legal affairs. In the event a suspected violation involves the top management of Wärtsilä Corporation, or the suspected case is believed to be significant, the Audit Committee of the Board of Directors of Wärtsilä Corporation may be contacted directly. An employee who reports a potential Code of Conduct violation in good faith shall suffer no harassment, retaliation, or adverse employment consequences. Finally, Wärtsilä employees are instructed to seek advice on ethical and lawful behaviour and in the matters of integrity from Wärtsilä legal counsels or from the compliance function. 


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Environmental compliance
Wärtsilä companies comply with the local environmental legislation. The operations of Wärtsilä's manufacturing companies require a valid environmental permit. Wärtsilä companies have the required environmental permits, the terms of which are generally met. Incidents of non-compliance are described in the following chapters.
Environmental disturbances (G4-EN24) and complaints (G4-EN34)
The number of disturbances, complaints and incidents of non-compliance are presented in the table below. Reported disturbances cover incidents in which the Wärtsilä company concerned has usually been obliged to report the disturbance to the authorities.

The main environmental disturbances that occurred in Wärtsilä's business locations in 2014 were 10 oil spills and a soot spill. All the disturbances were investigated and appropriate corrective actions were taken in each case to minimise the impact on the environment. There was also a complaint made by occupants of neighbouring property related to noise. The complaint was investigated and the sound levels promptly normalised.
Cases of non-compliance (G4-EN29)
Wärtsilä UK Ltd. had a case of plumbing failing to meet the standards of water supply regulations. The plumbing was promptly rectified to reach compliance with the standards.
Disturbances, complaints and non-compliances 2014 2013 2012 2011 2010
Disturbances 11 5 3 6 8
Non-compliances 1 2 2 6 3
Complaints 1 1 7 5 5
Non-compliances 1 4 3 4 2
Fines of non-compliance cases (EUR) 9 824 9 787 45 079 7 869 26 157
Non-compliance cases presented in previous reports
Wärtsilä de Mexico S.A. arranged the Environmental Impact Statement required to operate in the protected natural area of Cd. Del Carmen.
Human and labour rights compliance (G4-LA16, G4-HR3, G4-HR4, G4-HR5, G4-HR6, G4-HR12, G4-SO8, G4-SO11)
Wärtsilä supports and respects basic human values as outlined in the UN's Universal Declaration of Human Rights. Wärtsilä also supports the Ten Principles of UN Global Compact, of which six principles are related to Human and Labour rights.

Wärtsilä's employees represent 122 nationalities. The company supports fair and equal treatment of all its employees. Wärtsilä supports the work-related rights defined by the International Labour Organization (ILO). Therefore the company works to ensure that there is freedom of association and right to collective bargaining in the company. In those countries where local legislation does not recognise these rights, Wärtsilä endeavours to give employees other channels for expressing their opinions.

Wärtsilä does not accept the use of forced labour or child labour in any form. Wärtsilä is unaware of any cases of breach of human rights, discrimination, infringements of rights at work or the use of forced or child labour. During the reporting period the following misconduct was realised:

Wärtsilä Korea Ltd. was charged a penalty fee of EUR 9,824 for not fulfilling its legal obligation to hire disabled persons covering a minimum of 5% of the total headcount. The company has mainly hired blue collar employees, which limits the suitable job offerings to disabled persons.
Preventing corruption and bribery (G4-SO5)
In May 2009, a former senior manager of Wärtsilä Finland Oy was charged before a court of first instance in Finland with bribery allegedly committed in aggravated circumstances. The charges related to a consulting agreement concluded in 1997 in connection with a power plant project in Kenya. Subsequently, in October 2009, Wärtsilä Finland Oy, which was the Wärtsilä contracting party and the former employer of the senior manager, was charged for aggravated giving of bribe (corporate criminal liability), for which prosecution demanded that Wärtsilä Finland Oy be ordered to pay a corporate fine. Both the senior manager and Wärtsilä Finland regarded the charges as unfounded. Wärtsilä cooperated with the investigation authorities throughout the investigation. On 18 December 2009, the court of first instance in Finland dismissed all the charges and demands. After a lengthy appeals process for reasons of procedural law, the case was referred back to the court of first instance for a new hearing as no evaluation of the evidence had been conducted earlier. On 21 March 2013, the Pohjanmaa district court, being the court of first instance to hear the case for the second time, rendered its verdict. The court dismissed the charges against Wärtsilä Finland Oy but condemned the former senior manager to prison on probation for a period of 1 year 6 months on account of aggravated bribery. The Vaasa Court of Appeal, by unanimous decision, overruled the verdict by the Pohjanmaa District Court by finding the former senior manager of Wärtsilä Finland Oy not guilty of aggravated bribery. The Court of Appeal thus dismissed all the charges against the former senior manager and Wärtsilä Finland Oy. The Court of Appeal ordered the Finnish State to reimburse Wärtsilä Finland Oy and the former senior manager for their legal costs. In June 2014, prosecution submitted a petition for leave to appeal to the Supreme Court. The Supreme Court has not yet given its decision to the petition.
Political lobbying (G4-SO6)
During 2014, Wärtsilä did not make any contributions to political parties.
Competition regulation (G4-SO7)
As before, Wärtsilä arranged a number of competition law training seminars in 2014 for the relevant personnel in order to further promote knowledge of competition laws and thus ascertain full compliance with them.
Product responsibility (G4-PR2, G4-PR4, G4-PR7, G4-PR8, G4-PR9)
During the review period, no instances of non-compliance related to product liability or customer privacy were identified.


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