Human rights
We strongly believe that it is our duty to respect internationally recognized human rights, including the rights of people along our entire value chain. Human rights are integral to our purpose-led and performance-driven strategy. We believe that the basic rights and freedoms to which all people are entitled should be understood, respected, and promoted by all companies as the cornerstone of responsible business.
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2021 |
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2020 |
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Gender pay gap1 2 |
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7% |
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8% |
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Living wage |
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Employees below lower-bound |
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0% |
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- |
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Employees below higher-bound |
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< 0.1% |
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< 2% |
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Respecting human rights means that we follow international guidelines and implement the United Nations Guiding Principles (UNGPs). We have further elaborated on this in our (revised) human rights policy, available on our company website, in which we also set out our governance structure (DSM’s Human Rights Steering Committee and assignment of the role of DSM’s Human Rights Lead) and our due diligence processes for identifying and mitigating risks. Grievances relating to human rights are addressed according to the Code of Business Conduct and our whistleblower procedure, DSM Alert.
Strengthening our human rights approach
In 2021, we took important steps to strengthen our approach to human rights, as well as to further embed this approach throughout our operations. For example, we undertook an in-depth analysis of salient human rights issues in our own operations and conducted a human rights impact assessment in India. Through this impact assessment, we were able to identify key points for improvement for upholding human rights in India, as well as for our global approach to human rights. Looking ahead, many of these points for improvement will be further included in national action plans as well as in our global Human Rights Roadmap. Specifically, topics such as living wage and grievance mechanisms will be further explored.
Through virtual learning sessions, DSM’s Managing Board and Executive Committee also received an in-depth training on human rights. Tailored training will be provided to other targeted audiences throughout 2022.
A focus on salient issues
In 2021, we started to implement due diligence structurally as part of our human rights approach. This approach meant a review and relaunch of our human rights policy, and a more elaborate and inclusive salience analysis of our potential human rights risks. This analysis identifies the salient issues that have the potential for the most severe negative impact through our activities or business relationships, and allows us to better prioritize and focus on the most severe potential impacts. Our salient human rights issues are child labor, health and safety, living wage, forced labor, migrant workers, harassment, land acquisition and resettlement, human rights defenders, and freedom of expression and rights issues from industrial agriculture. These issues will be the focus points of our human rights work in the years to come and are included in our human rights roadmap. We recognize that other human rights may become greater priorities over time, and we will regularly review our focus areas.
Fair remuneration
DSM is committed to the principle of equal opportunities for all employees, which includes providing our employees with a living wage. We align our calculations with the Anker methodology (Anker and Anker 2017). We also aim to reward our employees for their overall contributions to the company, setting equal pay for men and women doing similar work that requires equivalent qualifications and skills. Our Fair Remuneration Statement, available on our company website, further elaborates on our position.
Gender pay gap and equal pay
We continue to use the GRI 405-2 topic disclosure as guidance for calculating our gender pay gap. Our 2021 results showed a gender pay gap of 7% in favor of women, (female:male pay ratio of 107:100), a change of 7 percentage point compared to 2020, which is mainly due to changes in the average salary of both genders and headcount fluctuations in the 6 regions. This ratio is based on validated employee base pay data for locations where we have significant operations and covers approximately 66% of our global employee base. These operations include Brazil, China, India, the Netherlands, Switzerland and the US, excluding our operations in Pentapharm (Switzerland and Brazil), Erber (all countries), Twilmij (Netherlands) and Jiangshan (Jiangsu Province, China). The pay gap can primarily be attributed to a higher proportion of male employees in lower-level positions, and it does not necessarily indicate if we pay men and women equally for doing similar work.
We aim to make further progress in the area of equal pay. Throughout 2021, we continued our partnership with AnalitiQs to develop an advanced analytical model that will allow us to investigate background variables in much greater depth and obtain useful insights. We concluded that a more holistic approach to equal opportunities is needed to allow us to further advance in this regard. This will also require cross-functional collaboration including linkages with data analytics and diversity, equity and inclusion. In 2022, we will continue to further advance the use of the analytical model and renew our focus on opportunities within the cross-functional approach.
Living wage
We are committed to paying a living wage to all our employees based on WageIndicator’s benchmark methodology. We have started with our significant locations of operations (defined above). We aim to expand the number of countries included in this analysis over the coming years. In 2021, we assessed wage levels against WageIndicator’s typical family with higher-bound (our target level) and lower-bound (for comparative purposes) living wage figures. WageIndicator’s methodology uses the following definitions:
- The typical family is defined as two adults with a number of children derived from the national fertility rate
- The employment rate is defined as one adult working full-time, while the employment rate of the other adult is derived from the national employment rate
- The higher-bound uses prices (for housing, food and other indispensable goods or services) at the 50th percentile (where 50% of people report higher prices), while the lower-bound uses prices at the 25th percentile (where 75% of people report higher prices)
Based on our assessment, two employees (less than 0.1% of employees in scope) are paid below the higher-bound living wage figures These employees left the company in 2021, so no corrective action can be taken in 2022. No employees were paid below the typical family with lower-bound living wage figures.
