Policies and Codes of the KGHM Group
In KGHM we are cognizant of our obligations and responsibilities in terms of sustainable corporate development. For many years we have been developing and implementing Policies and Codes which reflect our commitment and approach to our natural and social surroundings.
The following Policies and Codes have been implemented within the KGHM Group.
Sustainable development
SUSTAINABLE DEVELOPMENT POLICY
The Sustainable Development Policy of the KGHM Group applies to all entities of the KGHM Group and is applicable throughout the entire value chain, including external business partners. Responsibility for the implementation and supervision of the implementation of the Policy lies with the Management Board of KGHM Polska Miedź S.A., supported by the ESG Department and the relevant organizational units responsible for individual areas of activity. The Policy is an integral element of the KGHM Group's management system, influencing decision-making processes, operational planning and reporting activities.
Our commitments
The sustainable development goals pursued by the KGHM Group are an integral part of the management model. In particular, we undertake to:
- Conduct business based on the highest standards, in accordance with the adopted values: zero-harm, teamwork, results-driven, accountability and courage.
- Develop in a sustainable manner, with respect for ethical principles and transparency, while taking into account best industry practices in the field of social and environmental responsibility.
- Strive to achieve climate neutrality by 2050 in terms of greenhouse gas emissions.
- Develop and implement innovative technologies, including renewable energy sources, to increase energy efficiency and reduce emissions.
- Optimize production processes in accordance with the principles of the circular economy (CE), by minimizing the consumption of resources and improving copper recycling processes.
- Ensure safe and decent working conditions, promote diversity and equality, and support the professional development of employees.
- Conduct an active dialogue and cooperation with stakeholders, including local communities, business partners and non-governmental organizations, in order to jointly implement the set sustainable development goals.
- Transparently report sustainability issues using the European Sustainability Standards (ESRS), integrating them with financial information. Sustainability reporting is carried out on a cyclical basis, as an integral part of the annual reporting obligations.
Stakeholder collaboration and engagement
The KGHM Group maintains constant contact with stakeholders, taking into account their expectations and needs in the decision-making process. It cooperates with international and industry organizations and representatives of local communities, striving to jointly achieve the goals of sustainable development. Openness to dialogue and transparency of activities are the foundation of the KGHM Group's relations with its stakeholders.
Monitoring and reporting
The KGHM Group regularly monitors progress towards the achievement of its sustainable development goals. Performance information is presented as part of sustainability reporting and is publicly available to all stakeholders.
References to standards and initiatives
The Sustainable Development Policy of the KGHM Group has been developed in a way that ensures its consistency with:
- The UN 2030 Agenda for Sustainable Development
- OECD Guidelines for Multinational Enterprises
- UN Guiding Principles on Business and Human Rights
- European Sustainability Reporting Standards (ESRS)
- The Integrated Management System – based on ISO standards.
Natural environment
EnvironmentAL POLICY
The prevention and minimisation of environmental and climate impact as well as the rational management of our natural resources are of fundamental importance for KGHM Polska Miedź S.A. in its efforts to achieve sustainable development, to meet the expectations of our stakeholders and to be responsible towards future generations.
The activities of KGHM Polska Miedź S.A., including those involving exploration, mining, processing and refining, comprise technical and organisational actions based on best available techniques which reduce our environmental and climate impact.
Meeting such high environmental standards is crucial to maintaining the Company’s competitive position amongst the world’s copper producers.
Our strategy places particular emphasis on ecologically-friendly production and on protecting the natural environment and climate, as well as on pursuing a circular economy, including the increased use of recycled materials.
Based on continual improvement under the PN-EN ISO 14001 Environmental Management System, the Company’s senior management is committed to the following:
- the continuous prevention and restriction of the Company’s environmental and climate impact by improving and developing our technological processes, modernising and replacing equipment and preventing pollution and breakdowns,
- the rational utilisation of our environmental resources, such as land, water and forests,
- the rational management of our natural resources,
- restricting the amount of waste generated and the continuous development of waste management methods,
- restricting emissions to the air, water and soil,
- restricting greenhouse gas emissions, while taking into account critical economic aspects,
- restoring terrain adversely impacted by our activities,
- the prudent application of new solutions and innovations, taking into account during their design and implementation their environmental and climate impact,
- meeting the adopted and justified expectations of our stakeholders,
- adherance to legal requirements and respect for ethical principles,
- the active support of efforts to ensure biological diversity and, if that is not possible, to undertake appropriate compensatory actions,
- the responsible management of land and green terrain,
- open and honest dialogue with and respect for local communities and indigenous peoples as well as appropriate governmental authorities, aimed at strengthening protection of the environment and climate,
- the responsible management of chemicals,
- raising the professional qualifications and awareness of employees with respect to protection of the environment and climate,
- shaping the attitudes of employees, contractors, customers and local communities to be more ecologically conscientious.
This Environmental Policy (PDF), adopted by the Management Board of KGHM Polska Miedź S.A., shall apply to the Head Office and to all of the Company’s Divisions, and is publically available, known to and applied by all of the employees and other persons working on behalf of the Company.
CLIMATE POLICY
KGHM Polska Miedź S.A. (hereinafter referred to as “KGHM” or the “Company”), as one of the largest global copper producers, will have a significant impact on the successful transformation into a low-carbon economy. The new role will stem from having to satisfy the growing demand for copper, which is a key component of the green economy of the future. Apart from supporting the transformation directly by providing the key resource, KGHM will also contribute indirectly to the reduction of greenhouse gas emissions. Furthermore, given this perceived reality, KGHM sees the potential for increasing its role in the global economy – generating new, previously unattainable opportunities to improve the competitive potential of the Company.
The above-mentioned vision is expressed by the Climate Policy of KGHM Polska Miedź S.A., which aims to convey the following objectives:
- to define the ambitions of KGHM Polska Miedź S.A. regarding the reduction of its impact on the climate and to adapt the operations of the Company to fulfil these ambitions,
- to describe how the Company’s operating model should be adapted to the existing and predicted climate change.
Read more:
Climate Policy of KGHM Polska Miedź S.A. - document
Climate Policy of KGHM Polska Miedź S.A. - leaflet
Energy Policy
Efficient and effective energy management is of fundamental importance for sustainable development, the Company’s values and occupational safety. KGHM Polska Miedź S.A.'s primary goal in terms of energy management is to pursue a rational energy management policy while ensuring the highest quality of the products and services provided, safe working conditions and the highest standards of environmental protection and at the same time guaranteeing the security of power supply to the facilities and installations. Our ambition is to continuously increase the share of renewable sources of energy and internal generation to cover our energy needs - by 2030 we want 50% of the power consumed by the company to be supplied from our own generating sources, including renewable energy.
The basic principles of energy management at the Company, the aspirations and the management staff's commitment are included in the Energy Policy of KGHM Polska Miedź S.A.
Society
Code of ethics
The Code of Ethics of the KGHM Polska Miedź S.A. Group is the main tool in our corporate culture which assists in the setting of priorities and establishing a collection of principles which are binding for all of our employees in their daily work. The Code of Ethics is a guide to proper conduct at work and helps us in our daily decision-making. It makes us stronger as a team. It also supports our image as a stable, responsible, and socially-engaged company.
In June 2018 the Management Board of KGHM Polska Miedź S.A. adopted the Code of Conduct of KGHM Polska Miedź S.A. At the same time the Company declared its commitment to sustainable development, based on respect for ethical principles, transparency and best industry practice, and commitment to being a socially and environmentally responsible enterprise, grounded on the KGHM Group’s Code of Ethics. Both documents regulate behavior standards that the Company is guided by. The Codes are an integral, mutually interconnected whole, based on consistent assumptions and values followed by the Company.
Safety policy
KGHM Polska Miedź S.A. has adopted a unified OHS Policy. The life and health of employees and workplace safety in general is the chief priority in the hierarchy of values of KGHM Polska Miedź S.A. The life and health of employees and workplace safety in general is the chief priority in the hierarchy of values of the KGHM Polska Miedź S.A. Group. For several years the Company has advanced its vision of „Zero accidents due to human and technical errors, zero occupational illnesses among our employees and contractors”.
The Company applies high OHS standards, approved by the ISO 45001:2018 standard, that apply towards its own employees as well as towards those providing services on the grounds of KGHM Polska Miedź S.A.
All work stations have identified threats. The Company has assessed occupational risks and updates them continually. Working environments are continually monitored and periodic reviews and potential threat assessments are conducted, as well as reviews of equipment and required technical checks and approvals. Employees undergo systematic training and continually enhance their qualifications. The Company has implemented procedures for identifying incidents and mitigating dangerous situations. KGHM immediately implements new regulations and legal requirements in the scope of occupational safety. The Company also actively participates in the work of various workgroups to develop the best available practices and attitudes in the area of occupational health and safety in the mining and processing industry.
The current assessment of occupational safety status in the Company is carried out at weekly meetings of the Vice President of the Management Board responsible for Production, and at monthly meetings of the Management Board with the management of all KGHM’s Divisions. The Company also organizes regular meetings with mining supervision authorities and with representatives of the Polish State Labor Inspectorate, in which social labour inspectors representing employees from individual Divisions participate. At least once a year, the issue of occupational health and safety is presented to the Occupational Safety Council at KGHM Polska Miedź S.A. established in the Company. The Council is composed of representatives of the Company's top management from the trade unions operating in KGHM Polska Miedź S.A. and Company Social Labor Inspectors in KGHM Polska Miedź S.A.’s Divisions.
During numerous operational, periodic and specialised training courses, as well as using the many communication channels operating in the Company, information on occupational risk at work stations, in the field of occupational safety and industrial hygiene, is presented on an ongoing basis.
Diversity declaration
As part of the activities of KGHM Polska Miedź S.A., an important aspect of human resources management is the monitoring and reporting of wage indicators, including the pay gap and total remuneration. In 2023, the company continued its commitment to ensuring pay equity through a thorough analysis of pay by gender, taking into account various factors influencing remuneration levels.
As part of its pay equity efforts, KGHM used a methodology that took into account the various aspects of employees' work, qualifications and professional experience. These actions are consistent with social and corporate responsibility and form part of the Group's strategic human capital management.
The difference in remuneration of men and women is described as a percentage part of men's earnings. The Gender Pay Gap indicator - GPG - is used to calculate the difference.
Ratio of the basic and the total average annual remuneration of women to the remuneration of men
| Type of remuneration | Gender pay gap - GPG |
Average annual remuneration | Basic | 2,9% |
Total | 8,5% |
Average hourly remuneration | Basic | 5,5% |
Total | 9,4% |
The noticeable difference between the average annual and hourly remuneration results from the use of reduced working hours in the mining and production Divisions, due to the presence of working conditions particularly onerous or particularly harmful to health. Employees, mainly men, working under these conditions and working in reduced hours are entitled to be paid as if they were working an eight-hour day.
An analysis of the components included in basic and total remuneration shows that the pay gap to the detriment of women is most affected by pay components related to working conditions, mainly linked to the workplace (underground) and working systems.
human rights pOLICY
We recognise that the protection of human rights is strategically important. In order to ensure that all human rights are fully protected and that this Human Rights Policy is up-to-date, continuous monitoring and analysis of the value chain is conducted. This Human Rights Policy is compliant with the implemented Corporate Risk Management Policy and Procedure and contains the identified risks regarding potential human rights violations in the Company’s operations along with their mitigation. Despite the limitations specific for the mining, steel and metal refining industries, we strive for continuous improvement of attitudes. This Policy is supported by the Company’s existing regulations and procedures which form part of this document.
KGHM Polska Miedź S.A. is a global organisation, aware of the role played by human rights in the contemporary world. As a company that plays a crucial role in the Polish economy, we accept the responsibility to protect and respect all internationally recognised human rights.
In KGHM Polska Miedź S.A. we pledge to protect, promote and implement human rights wherever we carry out our activities and towards all entities on which we have a direct or indirect impact. KGHM Polska Miedź S.A. does much more to protect human rights than is required by domestic law. We pledge to conduct our business in a manner consistent with the International Charter of Human Rights1, the UN Guiding Principles on Business and Human Rights, the OECD Guidelines for Multinational Enterprises, the UN Declaration on the Rights of Indigenous Peoples and the OECD Due Diligence Guidance on Conflict-Affected and High-Risk Areas. We declare that respect for human rights by other entities with which we cooperate is an important factor to be taken into account when establishing mutual business relations.
Any questions, comments and irregularities concerning human rights violations, can be reported through a Whistleblower Platform, which is accessible to all at the following link (for English choose EN): https://liniaetyki.kghm.com/web/liniaetyki/kanaly/
Statement on Respect for the Rights of First Nations and Indigenous Peoples
Responsible supply chain policy
As a KGHM Group we are committed to the highest standards of products’ manufacturing, business ethics and business conduct in our day to day operations. We follow these rules in our value chain creation process, which is reflected in the KGHM Group Code of Ethics.
KGHM is fully aware that the selection of responsible suppliers is crucial for conducting activities oriented towards sustainable development.
To ensure the highest standards regarding obtaining metals from conflict-affected and high risk areas, KGHM has adopted risk-based due diligence, which allows to identify high-risk business relationships based on the criteria set out in the The OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas, The LBMA Responsible Gold Guidance, The LBMA Responsible Silver Guidance and Joint Due Diligence Standard for Copper, Lead, Nickel and Zinc implemented in KGHM’s Smelting/Refining Divisions.
We do not tolerate, support, contribute to or benefit from:
• any forms of torture, cruel, inhuman and degrading treatment,
• any forms of child labour or of forced or compulsory labour,
• minorities discrimination,
• violations of international humanitarian law,
• war crimes, genocide or any crimes against humanity,
• violating the rights of indigenous peoples,
• money-laundering and financing of terrorism,
• all forms of corruption and other activities related to economic crime, including financial fraud,
• degradation of cultural and natural heritage sites,
• violating health and safety rules,
• violating the right of association,
• other serious human rights abuses.
KGHM have formalized our responsible supply chain management system by approval of the KGHM Polska Miedź S.A. Group Responsible Supply Chain policy, the Responsible Gold Supply Chain Audit Procedure in KGHM Polska Miedź S.A. and the “Due Diligence Procedure For Copper And Lead Supply Chain at KGHM Polska Miedź S.A.”
The system is audited on a regular basis by a 3rd party.
Corporate Governance
Management System – ISO Standards
Management systems according to ISO standards are internationally recognised standards that indicate to companies the optimal way to operate. Implementing and improving systems is therefore not a fad, but an essential tool for ensuring competitiveness. ISO certification proves that the company meets certain requirements and standards, and because they are international standards, the organization gains recognition around the world. The current state of implementation and certification of standardised management systems in the Head Office and Divisions of KGHM Polska Miedź S.A. is presented at Management System site.
INFORMATION SECURITY POLICY OF THE KGHM GROUP
Information security is crucial for business continuity and the achievement of the goals of the KGHM Polska Miedź S.A. Group (KGHM Group). This translates into our obligation to protect information and supporting assets. We strive to make our approach to information security management respond to current external and internal threats, to make it fully integrated with our operations and business processes, allowing them to be run in a secure and responsible manner. For this purpose, as part of the Integrated Management System, an Information Security Management System, compliant with the requirements of PN-EN ISO/IEC 27001, has been established, implemented, maintained and continuously improved.
Information Security Policy of the KGHM Group
CORPORATE RISK MANAGEMENT POLICY
The Corporate Risk Management Policy of the KGHM Polska Miedź S.A. Group describes the approach to risk management, the basic principles involved and the process of corporate risk management in the KGHM Polska Miedź S.A. Group. This comprehensive approach to risk management is consistent with the strategy of development, continuous striving for operational excellence and the principles of sustainable development and responsible business. It was designed so as to be able to support the Company in building a rugged corporate structure.
COMPLIANCE MANAGEMENT POLICY
The Compliance Management Policy of the KGHM Polska Miedź S.A. Group describes the approach to compliance management, the basic principles involved and the process of compliance management in the KGHM Polska Miedź S.A. Group. We recognise compliance as an important element of our effective operations and we have a compliance management process which is linked to the process of managing corporate risk in the KGHM Polska Miedź S.A. Group. The compliance system is an important business tool used to prevent the occurance of events which could lead to sanctions.
BUSINESS CONTINUITY MANAGEMENT POLICY
The Business Continuity Management Policy of KGHM POLSKA MIEDŹ S.A. describes the approach to continuity of operations management, the basic principles involved and the process of continuity of operations management in KGHM Polska Miedź S.A. We recognise the continuity of operations as an important element of our effective operations and we have a continuity of operations management process which is linked to the process of managing corporate risk in KGHM. The continuity of operations management system is an important business tool used to increase the Company’s ability to deal effectively with crisis situations by minimising the impact of catastrophic events, protecting KGHM’s reputation and its shareholder value.
The basic principles of energy management at the Company, the aspirations and the management staff's commitment are included in the Energy Policy of KGHM Polska Miedź S.A.
Remuneration policy
The Remuneration Policy for the Members of the Management and Supervisory Boards of KGHM Polska Miedź S.A. is aimed at achieving the business strategy of KGHM, as well as the long-term interests and stability of the Company.
Competition policy
There is a Competition Law Policy in the KGHM Polska Miedź S.A. Group. Its purpose is to establish the operational framework for the system to ensure compliance with the competition laws prevailing in all the countries in which the KGHM Polska Miedź S.A. Group operates.
Procurement policy
KGHM Polska Miedź S.A. is guided by high ethical standards across the procurement process. The Code’s main message is to guarantee the professionalism and honesty of the persons responsible for the procurement process. The document also contemplates issues such as preventing conflicts of interest as well as equal treatment of suppliers to ensure compliance with the principles of fair competition.
The procurement procedures in effect in KGHM are precisely defined in the Procurement Policy and business partners are selected in accordance with the principle of equal treatment.
In tender documentation, the Company reserves the right to audit its suppliers and to assess their activities in terms of compliance with human rights and regulations governing the hiring of minors. External entities are also checked in order to secure the interests of KGHM, in the context of money laundering, breaches of fair competition rules, prevention of conflict of interests, etc.
Procedure for counteracting money laudering and the prevention of fraud and extortion…
...in trading transactions regarding the sale of products and the procurement of ore and copper-bearing materials of KGHM Polska Miedź S.A.
KGHM uses a diverse range of external counterparty verification in the procurement, sales and investment processes, which are regulated by a number of consistent and uniform internal policies and procedures. This procedure covers verification methods used for the purposes of trading transactions. To protect its image and the Company’s security, KGHM takes measures to prevent the Company from being used by third parties for unlawful purposes, such as money laundering, financing of terrorism or VAT extortion.
The security measures undertaken in this respect consist of:
- Client identification and verification of its identity based on the data provided by the Client, publicly available information and/or reports of credit bureaus,
- Undertaking, with due diligence, actions to determine the ownership as well as organizational structures or the Client’s links to other entities, in order to identify the Beneficial Owner of the transaction and verify its identity, using publicly available information and/or reports of credit bureaus,
- Obtaining information on the Client’s objective and intended character of the business relationship, using publicly available information,
- Monitoring of the business relationship with the Client, including completed transactions, in order to check if they are consistent with the Company’s knowledge of the Client and its business profile, and - if possible - examining the source of funds.
Anti-corruption policy
As a result of the implementation by the KGHM Polska Miedź S.A. Group of an Anti-Corruption System in compliance with the PN-ISO37001 standard, in December 2021 the Management Board adopted a resolution regarding a new Anti-Corruption Policy, second edition.
Under this policy, the KGHM Polska Miedź S.A. Group emphasises its commitment to fighting corruption in its business by the adoption and uncompromising observance of the “zero tolerance for corruption and bribery” rule whilst at the same time remaining compliant with laws in force as well as voluntary strictures aimed at combating corruption.
The adopted Policy applies to all of the employees of the Company and of the KGHM Group, as well as to our business partners, including suppliers and customers. The Policy forbids participation in any activity suspected of involving corruption of any sort, including the offering, promising, granting, accepting, demanding or otherwise seeking of undue material benefits, whether of a financial or non-financial nature, in particular as regards the carrying out of one’s official duties. The Policy also forbids the taking of any actions against persons who refuse to grant or accept undue material benefits.
Under the Policy, anyone who takes part in or witnesses an activity which is suspected of being corrupt in nature, or who possesses information regarding such an event, is obliged to immediately report this information, whilst senior management are obligated to ensure that secure, dedicated channels of communication are provided to whistleblowers, as well as to ensure that such whistleblowers are protected from retribution.
The Policy provides for disciplinary actions to be taken towards individuals who commit breaches of the anti-corruption rules.
Persons have been appointed in every KGHM Group entity who are tasked with ensuring compliance with the anti-corruption rules, and who have been granted the appropriate level of authority whilst maintaining their independence and impartiality.
The Policy has been communicated and is generally available to all employees, third parties and other persons working for or on behalf of our organisation.
Under the principle „prevention first and foremost”, in the KGHM Group we manage the risk of corruption by identifying and eliminating those factors responsible for increasing such risk through the implementation of adequate oversight mechanisms. As part of the Anti-Corruption System, a resolution of the Management Board of KGHM Polska Miedź S.A. was adopted on new procedures to manage corruption risk, ensuring the compliance of the activities undertaken by entities in the KGHM Group with the adopted Anti-Corruption Policy. Among others, these procedures regulate questions such as business gifts, situations potentially involving corruption and conflicts of interest.
Employees are prohibited from offering or accepting material benefits in relation to the performance of professional duties. The only exception is giving and accepting business gifts in line with the local norms and cultural customs, provided that the giving and accepting of gifts cannot lead to a situation in which such behavior could be considered as an attempt to exert pressure or persuade the recipient to act against their duties. Detailed rules pertaining to giving and accepting of customary business gifts have been defined in the Corruption Threat Prevention Procedure.
Privacy policy and personal data processing policy (website)
The Privacy Policy describes principles of informing the Users of the website about the aspects of obtaining, processing, using and securing data about website users, while the Personal data processing policy contains information on processing by KGHM Polska Miedź S.A. of personal data.
Information on the execution of the tax strategy for 2020
Information on the amount of taxation paid by the KGHM Group as well as accounting policies and important estimates, assumptions and judgments may be found in the Company’s annual and half-year financial statements, which are prepared in compliance with International Accounting Standards and International Financial Reporting Standards. The Tax Policy currently being prepared by the Company will serve the purpose not only of continuing and strengthening the Company’s reputation as concerns its obligations towards compliance with the aforementioned IAS and IFRS Standards, but will also be a response to the market’s ever-greater demands for transparency in the form, among others, of the GRI guidelines.
In the meantime the Company hereby presents „Information on the execution of the tax strategy of PGK KGHM II”, as required by art. 27c of the act dated 15 February 1992 on corporate income tax. The Strategy contains specific information required by law regarding taxation of the Group (in respect of which KGHM Polska Miedź S.A. is the Parent Entity) and of each of the companies included therein.
Information on the execution of the tax strategy for 2020 [PDF] (original version in Polish).
Information on the execution of the tax strategy for 2021 [PDF] (original version in Polish).
Information on the execution of the tax strategy for 2022 [PDF] (original version in Polish).
Information on the execution of the tax strategy for 2023 [PDF] (original version in Polish).
Tax Policy
The Tax Policy of KGHM Polska Miedź S.A. is a codified collection of best practices applied by KGHM in the process of calculating and executing its tax obligations. The Policy represents a response to the growing expectations for greater corporate transparency, articulated amongst others in the form of GRI guidelines. It is also a critical element in the process of strengthening the Company’s image, attesting to the heightened interest in issues related to social questions and corporate governance, as well as in monitoring the aforementioned questions related to ESG ratings.
