This Statement on Slavery, Forced Labor, Child Labor and Human Trafficking (“Statement”) applies to MAHLE Industries, Incorporated and its subsidiaries and affiliates located and registered to do business in the United States (herein referred to as “MAHLE US”). MAHLE US is committed to the prohibition of slavery, forced labor, child labor and human trafficking in MAHLE US’s corporate activities and in its supply chain. This Statement sets forth the actions and efforts by MAHLE US to address potential modern slavery, forced labor, child labor and human trafficking risks related to MAHLE US’s business and its supply chain.
MAHLE US also makes this Statement in accordance with California Civil Code Section 1714.43, also known as the California Transparency in Supply Chains Act of 2010 (“the Act”), which went into effect on January 1, 2012.
Pursuant to the Act, a company headquartered or doing business in California must disclose to what extent it:
- Engages in verification of product supply chains to evaluate and address risks of human trafficking and slavery;
- Conducts audits of suppliers to evaluate supplier compliance with company standards for trafficking and slavery in supply chains;
- Requires direct supplies to certify that materials incorporated into the product comply with the laws regarding slavery and human trafficking of the countries in which they are doing business;
- Maintains accountability standards and procedures for employees or contractors that fail to meet company standards regarding slavery and human trafficking; and
- Provides employees and management, who have direct responsibility for supply chain management, training on slavery and human trafficking.
Currently, the following MAHLE US entities conduct business in the State of California:
- MAHLE Aftermarket Inc.
- MAHLE Industries, Incorporated
- MAHLE Behr Troy Inc.
DESCRIPTION OF MAHLE US’S ORGANIZATIONAL STRUCTURE AND SUPPLY CHAIN
- MAHLE US is headquartered in Farmington Hills, Michigan. It conducts business in various states, with offices and production locations located across the United States.
- MAHLE US is a part of the MAHLE Group. The MAHLE Group is headquartered in Stuttgart, Germany and currently operates through its affiliate and subsidiary companies on five continents at some 170 production locations and 15 major research and development centers.
- The MAHLE Group is part of the global automotive industry supplying components to original equipment manufacturers and other automotive supply chain companies.
- The MAHLE Group collectively has approximately +3000 direct suppliers that in turn each has its own supply chain.
COMPLIANCE WITH THE ACT
1. MAHLE US’s Verification of its Product Supply Chain
- Prior to entering into a supply relationship, MAHLE US requires its suppliers to agree to MAHLE US’s General Purchasing Terms and Conditions (“Terms and Conditions”). An integral part of the Terms and Conditions is MAHLE US’s Supplier Code of Conduct, located on MAHLE US’s website, www.mahle.com. MAHLE US expects all of its suppliers to meet the ethical standards and requirements set forth in MAHLE US’s Supplier Code of Conduct. Section 3 of MAHLE US’s Supplier Code of Conduct sets forth the following requirement:
“Respect for the Basic Human Rights of Employees - The supplier respects and supports compliance of internationally recognized human rights. The supplier rejects every form of forced labor and may not employ any person, who is under the statutory minimum age as stated in the applicable laws.”
- During MAHLE US’s procurement process, MAHLE US requires its suppliers to complete a self-assessment questionnaire and will also conduct a preliminary site audit for select suppliers after MAHLE US awards the supplier the contract.
- To further strengthen its existing verification process, MAHLE US has included slavery, forced labor, child labor and human trafficking topics in the supplier self-assessment questionnaire in order to further to survey, assess and verify whether MAHLE US’s supply chain is at risk.
2. MAHLE US’s Audit of its Suppliers
- MAHLE US expects all suppliers to meet the ethical standards and requirements set forth in MAHLE US’s Supplier Code of Conduct, which is an integral part of MAHLE US’s Terms and Conditions.
- When applicable, MAHLE US audits select suppliers at the production facilities during the initial supplier review and procurement process. During the initial procurement process, MAHLE US ensures that there is no indications of any violations of human rights laws, including child labor, slavery, forced labor or human trafficking.
- MAHLE US will continue to identify other ways to support its commitment to ensure that its suppliers do not engage in child labor, slavery, forced labor or human trafficking.
3. Supplier Certification
- Prior to starting a supply relationship with a supplier, MAHLE US requires its suppliers to agree to MAHLE US’s Terms and Conditions in writing. MAHLE US’s Terms and Conditions incorporate MAHLE US’s Supplier Code of Conduct, which states suppliers must “reject every form of forced labor and to not employ any person who is under the statutory minimum age as stated by applicable laws.” Pursuant to MAHLE US’s Terms and Conditions, MAHLE US suppliers also certify they are in compliance with all local state and federal laws and regulations.
- MAHLE US distributes its Supplier Questionnaire to select suppliers during the initial procurement process. MAHLE US plans to update its Supplier Questionnaire to require suppliers further certify that materials incorporated into the product, its production locations, and business activities comply with applicable laws regarding slavery, forced labor, child labor and human trafficking.
- MAHLE US has updated its Supplier Code of Conduct in order to be more explicit about its prohibition on slavery, forced labor, child labor and human trafficking in its supply chain.
4. MAHLE US’s Accountability Standards and Procedures
- MAHLE US’s Business Code (“Business Code”) outlines the actions and behaviour that MAHLE US expects of its employees and contractors. The purpose of the Business Code is to provide a legal and ethical framework when conducting business. All MAHLE US employees must confirm in writing that they will comply with the Business Code, MAHLE US’s policies, local, state and federal laws and regulations. Additionally, MAHLE US requires select employees in key functions and managerial positions to complete compliance e-learning training biannually. The Business Code is readily available to all employees and contractors on www.mahle.com and on MAHLE US’s intranet.
- MAHLE US enforces its Business Code and policies and will subject employees who are in violation with disciplinary action.
- If MAHLE US employees identify any potential signs of child labor, human trafficking, slavery, or other human rights abuses within both its workforce and its supply chain, employees should report it to their manager or through their employee/union representative bodies. A compliance ombudsman or ‘hotline’ is also readily available to all employees.
5. MAHLE US’s Employee and Management Training
- MAHLE US requires all employees to be committed to the principle of non-discriminatory practices and respect internationally recognized human rights. Additionally, MAHLE US expects all employees to adhere to all local, state, and federal laws and regulations. MAHLE US provides annual trainings across the sales and purchasing functions and management level meetings to remind its employees of important policies and requirements.
- To further strengthen existing MAHLE US policies and trainings, MAHLE US includes topics on slavery, forced labor, child labor and human trafficking during annual training of its employees and management responsible for supply chain management.