Transparency Act Report 2022
Introduction
This report has been prepared in accordance with the Norwegian Transparency Act (the “Transparency Act”) section 5 and summarizes the policies and procedures in Perfect Temperature Group AS (“PTG”) with respect to safeguarding of human rights and decent working conditions and provides information on the implementation and results of due diligence conducted by PTG.
About PTG
PTG companies develop and deliver environmentally friendly solutions for refrigeration, freezing and enhancing energy efficiency. We are a substantial supplier to the grocery sector in Norway and to the seafood market nationally and internationally. Our products help to cut energy consumption and increase profitability for our customers in the marine, industrial, commercial and air conditioning markets. We are a complete supplier of sustainable temperature and energy solutions.
PTG was created by initially integrating the companies Kuldeteknisk, FrioNordica, Kjøleservice Helgeland and Multi Kulde (Bodø). Today, PTG consolidates more than ten companies across Norway and owns subsidiaries in the UK and Chile. With over 300 employees and annual turnover of roughly NOK 1.0bn, Perfect Temperature Group has grown into Norway’s largest center of expertise for temperature management.
The value of perfect temperature
PTG contributes to significant reductions in energy and emissions by delivering energy-efficient solutions which improve the climate. We create added value for our customers through perfect temperature management along the whole value chain. Our products are developed for low energy consumption and heat recovery. By tailoring energy consumption to the refrigeration requirement, we protect the environment and our customers from unnecessary emissions and costs.
Markets
Marine
We know that the end-product value increases when fish are chilled and frozen while at their freshest and when their nutrient content is at its best. Our solutions also improve operating economics by cutting fuel consumption and working time. In partnership with our customers, we identify the perfect temperature and solutions which are cost-efficient and environment friendly.
Our marine customers:
White fish vessels, pelagic vessels, well boats and suppliers of factories and processing plants.
Industry
Our knowledge of efficient production and high quality provides customers with the perfect temperature and the best results. Seeing the overall picture in close cooperation with customers allows us to help enhance end-product value.
Our industrial customers:
Aquaculture, processing of white and pelagic fish (filleting, packing, and freezing), abattoirs, bakeries, food on the go, studies and research, power generation, breweries, and suppliers of factories and processing plants.
Commercial
Our refrigeration and heat pump solutions help to keep food fresh and healthy in a cost-effective and environmentally friendly manner. In cooperation with our customers, we develop forward-looking solutions which suit stores of all sizes in the grocery sector.
Our grocery customers:
Individual stores, chains and construction companies.
Climate
Together with customers, we develop environmentally friendly air conditioning and heating solutions which help to cut energy consumption and improve profitability. We take care of the environment and the customer’s values in a secure manner and provide the best service and follow-up from the first conversation and throughout the system’s commercial life.
Our climate customers:
Construction companies, pipework and sanitary equipment contractors, property developers, computer rooms, public and private buildings, hospitals, and housing associations.
Commitment to human rights and decent working conditions
PTG works to ensure that our operations and business conduct do not have actual or potential adverse impact on human rights and decent working conditions. In 2022 and continuously, PTG AS worked proactively to safeguard human rights and decent working conditions. Some of the measures included updating our internal policies and procedures related to human rights and conducting analysis of our actual and potential risk of adverse human rights impacts. We conducted assessments of human rights protection at suppliers in 2022 and identified risks and mitigating measures as part of the due diligence process for 2022–2023. We also provided general human rights training to employees and more extensive training related to the provisions of the Transparency Act for employees in roles such as supply chain, finance, people and organization.
Reporting under the Norwegian Transparency Act
The Norwegian Transparency Act entered into force on July 1, 2022. The purpose of the Act is to promote enterprises’ respect for fundamental human rights and decent working conditions in connection with the production of goods and the provision of services and ensure the public access to information regarding how enterprises address adverse impacts on fundamental human rights and decent working conditions.
The reporting requires a general description of the following:
- General description of the organization, operating areas, markets and products;
- Guidelines and routines for dealing with actual and potential negative consequences for fundamental human rights and decent working conditions;
- Information on actual negative consequences and significant risk of negative consequences that the enterprise has discovered through its due diligence assessments;
- How the work with the due diligence assessment is organized; and
- Specific information on actual negative consequences and substantial risk for negative consequences which enterprises have identified through their due diligence assessments and measures the enterprises have taken or plan to take to stop actual negative consequences or to limit substantial risk.
PTG’s reporting is based on the UN Guiding Principles on Business and Human Rights and the OECD model for Due Diligence for Responsible Business Conduct.
Due diligence methodology has the following six steps (in the picture below) that describe how companies can work for more responsible and sustainable business practices.
OECD model for Due Diligence for Responsible Business Conduct
Guidelines and routines for handling Human Rights Due Diligence
At PTG, we recognize our responsibility to minimize the adverse impact of our operations, supply chains and other business relationships. Therefore, responsible business conduct (RBC) is strongly embedded in our policies and management systems. We embrace our obligation to perform assessments of impact on human rights and conduct due diligence to understand and mitigate adverse impact and ensure that PTG does not contribute to adverse human rights impacts.
Responsibilities
PTG’s Board of Directors has the oversight responsibility of the management of the company. The strategic direction is confirmed by the Board of directors, where environmental, social and governance issues are an integral part of the strategy process.
The CEO holds the responsibility for managing ESG including impacts on human rights and decent working conditions, supported by the management team, which is accountable for ensuring the effectiveness of the management processes and review of mitigation efforts for identified impacts. This includes assessing and managing risks of adverse impact on human rights and decent work related to PTG’s operations.
Finance function with Chief Financial Officer and Supply chain function have responsibility to carry out the due diligence process and in cooperation with the management team define the areas of business where responsible business conduct risks are most likely to be present and most significant, as well as stop, prevent and mitigate adverse impacts.
Management team has the responsibility for implementing aspects of the policies across relevant departments such as human resources, supply chain, IT, sales, service, technical, with particular attention to those workers whose actions and decisions are most likely to increase or decrease risks related to responsible business conduct.
As part of the implementation process of the requirements of the Norwegian Transparency Act, PTG established a procedure for handling information requests. The supply chain and finance functions are responsible for regular monitoring and follow-up of incoming requests for information.
PTG’s approach to managing human rights risks and promoting decent working conditions
Our overall approach to ensuring respect for human rights and decent working conditions throughout our operations and supply chain includes stakeholder involvement and cooperation through industry initiatives. PTG supports employees’ rights to form and join trade unions, and their right to remain non-unionized. Employees are informed of their trade union rights during onboarding and unions may promote themselves freely. PTG also follows the principles of diversity and inclusion as stated in our internal policies. PTG is reflecting on its expectations related to ethical business conduct in documents with suppliers. PTG recognizes an obligation to carry out human rights due diligence pursuant to the OECD Guidelines.
We are committed to carrying out our business in a way that supports and respects the protection of international proclaimed human rights. We do not engage in or support the use of child labor and fully support the elimination of all forms of forced labor.
The Company has established relevant policies and procedures, which set out how we manage issues related to human rights and decent working conditions in our supply chain that support and respect protection of internationally proclaimed human rights, labor rights, rights to freedom of association and non-discrimination. All policies and procedures are available for our employees in the Management System RMT+. Our policies are reviewed and updated as necessary by the Management Team in the annual management reviews. The company is committed to ESG policies through information sharing and the development of recommendations across departments and functions.
Due diligence on human rights and decent working conditions
PTG undertakes due diligence to identify, prevent, mitigate, and account for adverse impacts on human rights and decent working conditions. In line with the Transparency Act and the OECD Guidelines, as well as the United Nations Guiding Principle on Business and Human Rights, we apply a risk-based approach when evaluating risks of adverse impact on human rights and decent working conditions. This involves looking at the location and context of operations, nature of activity, the number of people that are potentially affected and severity and probability of impact.
In 2022 we started mapping our suppliers and business partners to identify risks of actual and potential adverse impacts associated with our operations. We assessed and evaluated these impact areas in our risk assessment process. The procedure is based on the six steps of the UN Guiding Principles on Business and Human Rights and the OECD model for Due Diligence for Responsible Business Conduct. Mapping and assessment of risks is a continuous process where our target is to implement measures where the risk of adverse impacts and our opportunity to influence is the greatest. Relevant elements that we based our risk assessment on are the following: Country, type of product and/or service, turnover of contractual party, industry.
The risk assessment takes its starting point in the general risk for adverse human rights impact related to geographical location and industry sector. PTG AS operates in a low-risk environment regarding human rights impact as most of our operations are located in Norway (with subsidiaries in UK and Chile), which on international human rights indexes has a very low risk, and where general and industry specific regulations safeguard human rights. Despite significant presence in Norway, we remain dependent on global suppliers. Our suppliers’ fabrication yards are often located in countries that are exposed to certain human rights risks. We do recognize a risk of forced and compulsory labor, risk related to safety and security at the workplace and risk related to migrant workers among our suppliers and the supply chains of our suppliers, particularly in Asia and Eastern Europe.
Based on our risk assessments, PTG has defined the following key risk areas for human rights due diligence for 2022–2023:
- Metal processing plants
- Installation and other hired technical services
- Electronic equipment
Mitigation of risk
Based on our risk analysis, we have not identified actual adverse impacts on fundamental human rights and decent working conditions linked to our own operations. Human rights due diligence assessments of selected suppliers have identified and remedied some gaps in the supplier business management related to safeguarding of human rights and decent working conditions. We are working to mitigate these gaps by implementing corrective action plans together with suppliers. Measures implemented consist of a combination of direct dialogue with the supplier, our own research, and formal actions.
Tracking implementation and results
The supply chain function is responsible for tracking implementation and results of mitigating actions. This will be done through audits and communication with suppliers.