General Business Principles

In 2014 393 GBP complaints were filed via the Philips Ethics Line and the GBP Compliance Officers. Compared with 2013 (335 complaints), this represents an increase of 17%.

This upward trend in the overall number of concerns can be attributed primarily to significantly more concerns being reported in Latin America (more specifically in Brazil), which now account for 30% of the total number of reports (2013: 17%). Europe and the Middle East (18% of the total) also showed an upward trend in terms of absolute numbers. In EMEA there were 44% more complaints than in 2013. This overall increase is believed to be due to the intensive communication campaigns to increase awareness of employees’ rights with regard to the GBP, as well as to the reporting facilities that are available to them. The number of complaints in the Asia Pacific region (17% of the total) decreased compared with 2013, making the current percentage more comparable with that in 2012 (18%). In North America the absolute number of complaints declined somewhat, accounting for 35% of the total number in 2014 (2013: 43%). We believe the continued dominance of North America and, since the beginning of 2014, Latin America as well, is due to the employees’ very high level of awareness of compliance issues and their ability to assert their rights in this respect.

The most common types of concerns are listed below.

Treatment of employees

As in other years, the most commonly reported concern related to the Treatment of employees, and accounted for 52% of the total. The vast majority of these complaints can be classified as either ‘Equal and fair treatment’ or ‘Respectful treatment’, and together they accounted for 81% of employee-related concerns.

Concerns that fall under ‘Equal and fair treatment’ related primarily to favoritism, discrimination and unfair treatment. More than 33% of these reports originated in the United States, with a further 20% being reported in Brazil. Looking at the ‘Respectful treatment’ category, which concerns primarily reports of verbal abuse, (sexual) harassment and a hostile work environment, again about one third of the complaints originated in the US, with another third coming from Brazil. Some 58% of all complaints filed in Brazil related to these two topics. For the US, this was 50%.

Business integrity

The second most-reported topic, which accounted for 28% of all reported cases, was Business integrity (2013: 33%). The majority (40%) of these concerns originated in the Asia Pacific region, followed by Europe and the Middle East (34%), Latin America (15%) and North America (11%).

More information on these categories can be found in the GBP Directives on www.philips.com/gbp.

Philips Group
Breakdown of reported GBP concerns in number of reports
2010 - 2014
 
2010
2011
2012
2013
2014
Health & Safety
3
2
11
3
10
Treatment of employees
184
132
205
203
203
  • Collective bargaining
1
1
5
  • Equal and fair treatment
64
41
72
80
72
  • Employee development
1
4
  • Employee privacy
2
1
1
1
3
  • Employee relations
4
1
2
5
6
  • Respectful treatment
96
71
102
84
93
  • Remuneration
12
6
15
15
11
  • Right to organize
1
  • Working hours
4
2
3
5
  • HR other
10
11
6
13
Legal
13
10
19
9
30
Business Integrity
112
107
119
109
110
Supply management
4
3
3
5
6
IT
6
7
Other
22
15
17
27
Total
338
269
374
335
393

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Substantiated/unsubstantiated concerns

Out of the 393 concerns reported in 2014, 133 are still pending closure, especially those that were filed towards the end of the year. The table below shows a comparison between those complaints which, after investigation, could be substantiated and those that could not.

Out of the 260 complaints investigated, 27% were substantiated after investigation. This is approximately the same level as in 2013 (28%) and 2012 (26%). Also, looking at the various types of issue, there were no striking differences in the percentage of substantiated complaints compared to 2013. The biggest difference is the number of substantiated Business integrity complaints, which now stands at 36% compared to 50% in 2013.

Substantiated complaints, i.e. complaints in which a breach of our General Business Principles was detected, were followed up with a range of disciplinary and corrective measures. The action taken varied from termination of employment, written warnings and suspension, to training aimed at raising awareness of organizational measures.

Philips Group
Classification of the concerns investigated in number of reports
2012 - 2014
 
2012
2013
2014
 
substantiated
unsubstantiated
substantiated
unsubstantiated
substantiated
unsubstantiated
Health & Safety
2
7
2
1
7
Treatment of employees
22
150
33
136
32
112
Legal
5
8
2
2
4
9
Business Integrity
37
51
32
32
25
45
Supply Management
1
3
1
IT
3
1
2
Other
11
4
4
18
Total
78
220
70
176
69
191

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