Freudenberg Group: Compliance

As early as 1887, when his sons joined the company, founder Carl Johann Freudenberg drafted his first principles of business conduct. The document forms the basis for the Freudenberg Group’s ten guiding principles with which the Partners and employees identify. One of these principles stipulates that success must be based on performance; Freudenberg will not engage in business transactions that involve illegal or unethical means.

Business Principles and Guiding Principles

The Guiding Principles derived from the Freudenberg Group’s Business Principles define the values shaping conduct towards employees, business partners, stakeholders and third parties.

Business Principles (pdf, 86 KB)

Guiding Principles (pdf, 271 KB)

Compliance structure

Freudenberg is a company whose Business Groups are entrepreneurially-driven and operate with a large degree of independence. Along with the holding company, these Business Groups are therefore responsible for conduct that complies with laws and regulations. Both the Board of Management of Freudenberg SE and the top management of the individual Business Groups clearly subscribe to this.

At the holding level, the focus is on compliance issues of critical importance throughout the Business Groups and in an international context that could pose a threat to Freudenberg, especially in terms of the company’s reputation.

Given the Freudenberg Group’s global presence and its product and market diversity, anti-corruption and anti-trust legislation are seen as potential risk areas.

Freudenberg’s ambition is to continuously improve its compliance organization, documentation and processes. A corporate function at the holding level coordinates Freudenberg-wide compliance measures, thereby strengthening and expanding collaboration between Group-level units and compliance managers in the Business Groups. Among other benefits, this promotes the implementation of Freudenberg compliance standards, best practice exchange and the further development of compliance programs.

An updated version of the training program on various compliance issues was rolled out online in 2022. E-learning courses are available for many individual topics, giving employees from defined fields and areas of responsibility the opportunity to raise their awareness of specific compliance topics.

Code of Conduct

The Code of Conduct is derived from the Business Principles and Guiding Principles, in particular the “Responsibility” Guiding Principle. It covers standards of conduct that are valid worldwide. It is designed to ensure that law-abiding and responsible behavior remains the cornerstone of business conduct.

The Code of Conduct is available to employees worldwide in 26 languages. It has been communicated and explained to all employees across the globe. The Business Groups have made use of the available communication channels in many ways. This consistent, continuous communication, which is also mandatory for new employees, and the binding nature of the Code of Conduct (for example, as an attachment to employment contracts) underscore the unequivocal requirement to adhere to these standards of behavior. The globally standardized e-learning tool on the Freudenberg Code of Conduct is an appropriate instrument for all employees to become familiar with the Code’s contents. The tool makes it possible to monitor participation and success, and invites feedback from employees.

The Freudenberg Code of Conduct is available in 26 languages. The globally standardized e-learning tool on the Freudenberg Code of Conduct is an appropriate instrument for all employees to become familiar with the contents.

Freudenberg plans to strengthen and further develop the role of the Code of Conduct as a cornerstone of corporate culture and to expand help and support for employees and their supervisors. In these efforts, Freudenberg focuses in particular on regular exchange with Business Group Compliance managers and on active collaboration with the Ethics Offices and their staff.

The Code of Conduct was revised in 2022 to adequately reflect changes in legislation and significant developments with regard to compliance standards. The new features refer in particular to more precise details governing essential issues in the fields of human rights and climate protection as well as taking into account new aspects such as matters concerning cooperation with business partners or prohibition of money laundering. It is planned to roll out an update of the e-learning tool to include these changes in 2023.

Code of Conduct (pdf, 928 KB)

Ethics Offices

The Ethics Offices are an important element of Freudenberg’s Compliance Management System. They serve as a confidential point of contact for all employees and third parties (i.e., persons outside the Freudenberg Group, such as suppliers or customers) wishing to report an actual or potential infringement of laws or Freudenberg’s Business Principles or Guiding Principles. The option to report compliance violations via a channel that guarantees confidentiality or to give warning of imminent offenses is designed to foster the culture of trust and protect Freudenberg’s Values and Principles even more effectively.

Corporate Audit and Risk Management

Aside from the main objective of reviewing the effectiveness of the internal control system in place, the work of Corporate Audit in 2022 also focused on identifying other potential risks and/or asset misappropriation.