Material compliance is simply good governance.
The management approach to the topic Materials is two-fold. On the one hand, the company focuses on material compliance, which means compliance with international (environmental) laws and regulations regarding the material composition and origin of materials. On the other hand, dormakaba places emphasis on the possible health impacts of our products, which is closely related to the topic Customer Health & Safety. As part of our commitment to this, dormakaba develops various Health Product Declarations.
At a Group level, dormakaba is currently focusing on Material Compliance on hazardous materials and conflict minerals. There is emphasis on EU Regulation 1907/2006 (REACH), EU Directive 2011/65/EU (RoHS) and the US Dodd-Frank Act (Conflict Minerals). We believe REACH and RoHS are high standards and thus meet further local requirements.
Management is both ad-hoc and strategic. For example, customer and internal requests and training are addressed ad hoc, whereas liaising with external legal support to review the requirements, and the drafting of a Group Directive Material Compliance are rather strategic.
In the 2018/19 financial year, the impacts of the upcoming EU Regulation 2017/821 (Conflict Minerals) and California Proposition 65 on the business and related processes will be evaluated. A further integration of material compliance requirements in the company’s enterprise resource planning (ERP) software is also underway.
Product Transparency Trends in Sweden
In Sweden, providing environmental and health product information on transparency platforms for the building industry is becoming a prerequisite for doing business. This is because these platforms are often searched and accessed by building planners and architects during product selection.
dormakaba offers Building Product Declarations (BPDs) for the Swedish building industry through Byggvarubedömningen (Building Material Assessment, BVB) and Sunda Hus. These assessments focus on transparency related to hazardous materials, but also on several life-cycle environmental criteria.
In the 2017/18 fiscal year, dormakaba worked on offering additional BPDs for our product portfolio. Currently dormakaba lists 70 articles on the BVB platform and an additional 88 on Sunda Hus, making the search for healthy products easier for our customers.
Through our Supplier Code of Conduct, dormakaba sets clear expectations that our suppliers should actively support ongoing efforts to manage and demonstrate product compliance with the above regulations.
Health-related Product Declarations
dormakaba offers various health-related product declarations which transparently give account of the materials found in our products. These take the form of Health Product Declarations (HPDs), Building Product Declarations (BPDs) or Declare Labels, depending on the local market requirements.
An HPD gives a detailed list of the materials and contents of a building product and the associated effects on human health. The declaration is a common reporting format in the USA with which the required transparency can be guaranteed.
dormakaba published more than 20 HPDs in the 2017/18 financial year in the latest version of the standard (HPD 2.1). Work is also in progress on HPDs for Modernfold and DORMA Hüppe products (Segment Key & Wall Solutions). Modernfold aims to have an HPD for each of its seven products completed by the end of year 2018.
The Declare label, which is relevant to the USA market, is like a nutrition label for the building industry. It lists the ingredients in products to help customers ensure healthier indoor living environments. It discloses where a product comes from, the materials it is made from, and its end-of-life pathway. Products with a Declare label are featured in a transparency platform and product database from the International Living Future Institute. The platform helps stakeholders in the building industry find products free from hazardous substances.
Its “Red List” contains the worst-in-class materials prevalent in the building industry, which pollute the environment, bioaccumulate to toxic levels in the food chain, and/or are harmful to construction and factory workers.
In the 2017/18 financial year, dormakaba published Declare labels for a total of seven products (Product Clusters Door Hardware and Mechanical Key Systems), and each achieved “Red List Free” status, the highest level offered by Declare.
Evaluation of the management approach
Beyond considering the results of benchmarking through investor ratings, there is no current formal evaluation of the above management approach.