CR Due Diligence
Corporate Responsibility Due Diligence Process
To ensure our control and to identify and assess potential risks and liabilities of Corporate Responsibility (CR) character, Tele2 follow several internal Due Diligence (DD) processes. The process for CR, in particular, is mainly based on our Code of Conduct (CoC) as well as our internal and external commitments to international norms and standards (see Kinnevik's CR requirements on its Major Listed Holdings).
The CR DD process has recently been undated, in 2012-2013, to include upgrades in international standards, such as the OECD guidelines, as well as new standards such as the "Ruggie framework" and else. The aim with our CR DD is to identify risks "which we will have to live with" and risks "which we can mitigate". Both risk categories will then be presented as a basis for decision to the Leadership team and the Board of Directors of Tele2 so they can make well funded decisions weighted against our risk apetite.
Given the lack of an internationally established and accepted standard, we have chosen to design our CR DD to identify risks on three levels:
- Country level risks – the CR part consists of information that is gathered through several trustworthy sources (e.g. Swedish Ministry of Foreign Affairs, selected Public Authorities and NGOs, Sanction lists, the EU, OECD, TI etc.) together with keyword searches to capture the local and global media and NGO perception.
- Company level risks – from a CR perspective we look for existing company policies and frameworks and how well they are implemented, communicated and follow upped upon concerning key material areas e.g. Health and Safety Policies, CoCs, Human Rights Policies, Environmental Policies etc. Adding to this we screen for companies’ ESG as well as their corporate governance to see if they live up to our CoC and commitments. If not, our job is to identify any potential gap and assess the cost and effort it would take to adjust to an for us acceptable standard.
- Individual owner level risks – this area is mainly handled thoroughly by our M&A department, since there are normally no specific CR aspects.
Today, the CR department is conducting the CR country and company risk analysis upon request from the M&A department and it is the M&A department that has the overall responsibility for the DD work.
With our aggregated input we can effectively identify, analyse, and communicate potential CR issues and their risk-level to the Board and Leadership team of Tele2. This makes sure that the parties have the necessary information about CR issues to be able to make the right decisions e.g. if CR risks are considered too high and cannot be mitigated to an acceptable level, the board can decide not to engage in a particular transaction, for example.