Sustainability policy

Sustainable development is the greatest challenge of our times. As the industries we operate in have a vast impact on the planet’s ability to sustain an increasing quality of life for everyone, global megatrends shape our business and guide our strategy. To meet the needs of the present without compromising the ability of future generations to meet their own needs, environmental, social and economic considerations are important to FLSmidth and are therefore integrated into our business model.

With our vision “to drive success through sustainable productivity enhancement”, our approach to sustainability is market-driven. Our pledge to the United Nations Global Compact and our values of competence, cooperation and responsibility provide the foundation for achieving strong results.

Impacts and risks

We seek to identify and understand all major sustainability impacts, opportunities and risks throughout our value chain. This relies on engagement with all relevant stakeholders, through transparency, open communication channels and meaningful dialogue. We evaluate and manage our impacts from our own activities, our supply chain and from customers’ use of our projects, products and services. For the impacts where we have directly control, we set targets in order to continuously improve over time. For impacts that we can influence, such as suppliers, joint ventures and customers, we strive to promote our values and commitment to sustainability to the greatest extent possible.

Policy framework

We have a regularly updated policy framework in place that clearly defines our specific commitments for each major impact, including:

Health, safety and environment policy

We are committed to achieve zero harm to our people and to our surroundings. It is part of our culture, and we see it as a precondition for providing sustainable productivity enhancement. With robust Health, Safety and Environment (HSE) management system and objectives, we drive success through continuously improving our HSE performance.

Where we operate we will ensure:

  • That health and safety of our employees and other persons working under our control is a top priority. We believe that injuries and occupational illnesses can be prevented and that travel related risks can be managed
  • That subcontractors comply with this policy and are selected with HSE performance as part of the criteria
  • That our activities minimise their environmental impacts, while mitigating climate change. We believe that they should not only comply with legal and other obligations, but also prevent pollution and utilize resources in a sustainable manner


Our values lay the foundation upon which our HSE management is built:

  • Competence: people are the key to improving HSE. Employees are therefore trained to ensure they have the competencies to work safely and how to protect the environment
  • Cooperation: cooperation between employees, contractors and customers is of the utmost importance for HSE performance. To achieve objectives, teams must be interdependent, sharing best practices and supporting one another
  • Responsibility: we all have a responsibility to promote HSE at work in accordance with applicable legislation and other requirements. Management will implement, periodically review and improve certified HSE management systems. Management is accountable for the allocation of appropriate resources to achieve the objectives set


October 2017

Thomas Schulz

Group CEO,


Group tax policy

The Board of Directors has approved the Group Tax Policy, which establishes the overarching principles and philosophies in the governance of FLSmidth's tax affairs globally. Compliance with the Group Tax Policy is mandatory for all companies and employees within the Group.

Wherever we operate around the globe, FLSmidth is committed to support community development and sustainable growth.

FLSmidth contributes with products and services that enable our customers and partners to extract natural resources and build societies with the lowest possible environmental impact.

At the same time, we acknowledge that direct and indirect taxes contribute significantly to government budgets. Being a responsible taxpayer is therefore of utmost importance to us.

Responsibility means paying the correct amount of taxes at the right time in all countries where we operate.

We strive to accomplish this through a strong governance framework focused on compliance with applicable laws as well as generally agreed principles of international taxation and standards for responsible business conduct.

At the same time, we consider tax an ordinary cost of business and therefore also an element in optimising the value creation for our shareholders.

FLSmidth is a global company undertaking complex projects and operating in a variety of developed and developing economies. Inherent risk and uncertainty in regard to compliance requirements and double taxation of income are therefore common issues faced by our businesses.

With respect to taxes we have a low risk appetite, and will actively mitigate tax risks and uncertainties resulting from business operations.

Protecting our strong reputation and the brand of FLSmidth is pivotal. We pursue the right balance between responsibility and shareholder interest through tax strategies, which are sustainable and consistent with our business strategy, risk management, codes of business conduct and our values: competence, co-operation and responsibility.

The Group tax policy is to be applied by all companies and employees of the group. All areas of our business are therefore supported by an operational framework that guides the business to achieve a responsible governance of FLSmidth's tax affairs.

We recognise an increasing interest from a broad group of stakeholders in multinational companies’ tax management and tax transparency. We accede to this trend and aim to communicate openly and in a clear, timely and transparent manner.


Applied principles:

Principles of tax strategy:

 Tax strategies should be:

  • Directly aligned to business operations
  • Sustainable
  • Compliant with FLSmidth's Code of Business Conduct

A fundamental objective of the tax strategy is the elimination of double taxation.

Tax risk management:

  • We will adopt tax positions which are correct in the light of all material facts and relevant legislation
  • Where there is uncertainty as to the application or interpretation of tax laws, we will document positions adopted and where appropriate seek external advice
  • We assess the exposure to tax risk on an annual basis in terms of both economic loss and reputational damage and report to the Audit Committee on this process


  • All FLSmidth's business and financial operations must comply with applicable tax laws and reflect generally accepted principles of international taxation
  • Local tax and VAT returns and other compliance work are outsourced to external specialists where the Group does not have the competencies internally.

Dealings with tax authorities:

  • We actively cooperate with tax authorities and strive to have a positive and open dialogue without compromising our rights


  • FLSmidth's Group Tax Policy is approved by the Board of FLSmidth
  • The Group Tax Policy is reviewed by the Board of FLSmidth regularly on the background of business, organisational and regulatory developments and amended as deemed appropriate
  • The Group Executive Management will secure the implementation of the principles and philosophies set out in the Group Tax Policy and will establish, maintain and develop the related operational framework
  • Group Executive Management will monitor compliance with this policy and report to the Board on a regular basis
  • Group Executive Management will promptly report to the Board any material breaches of the Group Tax Policy which hold the potential of causing significant economic loss or reputational damage to FLSmidth


February 2018

Thomas Schultz

Group CEO


Lars Vestergaard

Group Executive Vice President and CFO



Code of business conduct
We believe that compliance with laws, regulations and our own standards is central to our business conduct as well as to our long term sustainability as a group. As one of the world’s leading companies within our industries, we have a responsibility to set high standards: To be, and be seen to be, a business which is committed to high standards of business ethics, Competence (i.e. Profession-alism, Credibility and Integrity), Co-operation (i.e. Team Spirit and Openness) and Responsibility (i.e. Ownership and Will to Change). In a complex global business environment like ours, that’s not always easy. Our Code of Business Conduct (hereinafter referred to as the “Code of Business Conduct” or as the “Code”) defines the behaviour that the FLSmidth & Co. Group expects of its businesses and employees regardless of location or background. For more information please see our Code of Conduct.
Diversity & equality policy

FLSmidth is a global company committed to diversity and equality. With an enduring aim to be an employer of choice, FLSmidth recognises that attracting, developing and retaining a diverse workforce is a precondition for sustainable productivity enhancement.

The foundation for driving success relies on our competent employees to work innovatively and

collaboratively. A diverse workforce is an asset and we encourage all employees to realise their full potential and career ambitions through equal access to career, learning and development opportunities irrespective of personality, gender, age, ethnic or national origin and religious beliefs, disability, political or sexual orientation and family status.

We are committed to creating a safe, flexible and productive work environment that allows our employees to engage in a challenging career while maintaining the desired balance between work and personal lives. Accordingly, we offer market aligned remuneration for all, regardless of gender and other diversity differentiators. Our Diversity and Equality policy are reinforced through our values as follows:


We attract and retain diverse, talented people across the globe to understand and drive the markets we operate in and to expand into new markets. Embracing a diverse and competent workforce increases our ability to create value for our stakeholders. Although selection of candidates is based on having the best qualifications and experience, it is recognised that diversity improves the corporate culture, thereby improving productivity.


Diversity helps us to fully understand our customer's needs as well as operate effectively in a global business environment, where focus is on cooperation, quality and innovation. There is zero tolerance for discrimination of any kind, and reported incidents are handled with the attention they deserve.


Diversity works best when Equality is also a focus and we are committed to removing obstacles to creating an inclusive culture. It is our firm belief, that a diverse organisation at all levels produces better business results, when Equality is the foundation. Equality encompasses total rewards, learning and development opportunities, and equal access to career growth.

We do not treat employees from underrepresented groups differently; however we do recognise that natural cognitive bias can occur, and that the perception of an ideal manager can be culturally embedded.

Making conscious and unconscious bias visible fosters inclusion based on the company values.

We will increase the ratio of underrespresented groups on all levels in the organisation and increase our overall female ratio year on year by focusing on key initiatives to attract and retain females while also ensuring equality in our practices.

February 2018

Thomas Schulz
Group CEO,


Human resources policy

PDF (148KB)

It is FLSmidth’s vision to continuously strengthen our position as the preferred partner and leading supplier of equipment and services to the global cement and minerals industries.

We strive at conducting our business according to high ethical standards and set ambitious goals, and, based on our inherited values, we wish to ensure that our employees share our commitment and that they conduct business with integrity and professionalism.

Accordingly, it is our HR vision to be seen as an employer of choice. We seek to attract, develop and retain a highly qualified, competent and innovative workforce in order to support our business vision and stay competitive in the global marketplace. Our HR Philosophy is to encourage a learning and knowledge sharing culture for continuous innovation and development.

The competencies of our employees are of strategic importance to us, and we strive to help our employees to reach their full potential and excellent performance and success. Therefore, we spend considerable resources on continuing education and training of our employees, enabling the individual employee to continuously increase his or her employability and value to FLSmidth.

As our company thinks and acts globally, and as we continue to grow and become even more global, we see diversity as a business imperative that will help us serve our customers even better and thus supporting the future success of FLSmidth. We offer equal opportunities to all present and future employees, irrespective of gender, age, ethnic or national origin and religious beliefs, disability, political or sexual orientation and family status. We encourage our employees to play an active role in their community, but in respect of the diversity in our workforce, FLSmidth remains politically and religiously neutral and we expect our employees to do the same during working hours, while on the company’s premises and when acting on behalf of the company.

We offer an attractive and challenging place to work and an engaging culture built on our core values and global business results. We are committed to create a healthy, flexible and productive work environment that allows our employees to engage in a challenging career and attain the important balance between work and personal lives.

FLSmidth offers competitive employment conditions and remuneration and recognizes employees’ right to be organized and bargain collectively. We support human rights and do not engage in child or forced labour.

August 2018

Thomas Schulz

Group CEO,

Human rights policy

FLSmidth & Co. A/S and all subsidiaries (FLSmidth hereinafter) commit to respecting all international human and labour rights.

FLSmidth will respect all rights enshrined in the United Nation’s (UN) Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights, the International Covenant on Economic, Social and Cultural Rights and the International Labour Organisation’s Declaration on Fundamental Principles and Rights at Work. FLSmidth is a participant of the UN Global Compact and works in accordance with the OECD Guidelines on Multinational



FLSmidth acknowledges our share of responsibility in offering access to remedy where our business conduct has resulted in adverse impacts on human rights.


FLSmidth’s human rights due diligence process and this policy seek full and progressive alignment with the UN Guiding Principles on Business and Human Rights.


We commit to:

  • Identify, prevent and mitigate risks of human rights violations in all our operations and business relationships
  • Identify, prevent and mitigate adverse impacts we may cause or contribute to through our operations, business relationships and supply chain
  • Remediate direct or indirect adverse impacts on human rights caused by our business operations, business relationships and those of our suppliers’, the latter to the extent set out in the Supplier Code of Conduct
  • Systematically monitor and report on our work with human rights internally and externally.
  • Promote respect for and knowledge about human rights among our employees, contractors, business partners, suppliers and customers
  • Identify and augment positive rights enjoyment of internal and external stakeholders wherever possible


This policy applies globally to the management, employees and contract workers of all FLSmidth entities. In joint ventures, FLSmidth will work to commit other shareholder(s) to adopt this policy, or comparable standards for human rights due diligence.


Where an FLSmidth entity or subsidiary participates in an existing joint venture as a non-controlling shareholder, and where we enter into new joint ventures with a minority shareholding, our business partners shall be made specifically aware of this policy.


Where provisions in this policy differ from practice or policy in a national entity, subsidiary or other business unit, this policy shall determine future practice. It shall also inform the need for remediation.


Where standards or principles embodied in this policy conflict with national law or regulation in countries of operation of entities within the policy’s scope, FLSmidth is committed to working to achieve an outcome which does not violate the law of the country of operation, and also does not undermine universal standards of human rights.


August 2018

Thomas Schulz

Group CEO,

Supplier code of conduct

Suppliers play an integral role in FLSmidth’s operations and offerings to customers, with

mutual success depending on long-standing business ties and strong relationships. Aligning values and creating trust is the greatest enabler for collaboration with suppliers, contractors, sub-contractors, agents, joint venture partners and distributors (’suppliers’, hereafter). Embodying FLSmidth’s core values of competence, co-operation and responsibility, suppliers are expected to adhere to the minimum standards outlined in this Code.

FLSmidth is a signatory to the United Nations Global Compact and is guided by the United Nations Guiding Principles for Business and Human Rights (UNGPs). FLSmidth encourages suppliers to also commit to these frameworks.

Full compliance with local and national law and regulation, in letter as well as in spirit, is expected

of all parties involved in any business relationship with FLSmidth. Where national law is found to

be in conflict with this Code, a supplier is expected to adhere to the most stringent set of requirements.

FLSmidth expects all suppliers to meet the following standards:

Occupational health and safety

Suppliers must provide a safe and healthy working environment for all their employees and


Support FLSmidth’s Zero Harm target and work consistently to prevent and record fatalities,

injuries and occupational disease in their operations.

Suppliers must demonstrate an adequate safety management program, preferably according to

international standards such as OHSAS 18001/ISO45001. Such a program must include an

approved policy commitment, hazard identification and risk assessment, action plans, safety

incident investigation, instruction and training.

Appropriate work place conditions and equipment (including fire safety, evacuation routes and

emergency exits) must be in place.

Access to personal protective equipment for employees and contractors must be ensured.

Human rights

All suppliers shall respect the personal dignity, integrity, privacy and human rights of each

individual employed or affected by their business operations.

Suppliers shall, by written policy as well as by practice, prohibit any discrimination on the grounds

of race, gender, youth, age, union membership, religious or political affiliation, and sexual

orientation, indigenous or tribal status. This includes unbiased recruitment processes, data security of employees and equal pay for equal work.

Employment of security staff as well as any site or facility service staff must be compliant with

national labour law. Any use of force by security personnel must be authorised and monitored

systematically, and arms must be carried only in compliance with national law and following

training in their appropriate use in compliance with international standards.

Any housing made available by the supplier shall be of an adequate standard and where goods are sold by a supplier to workers, these must be sold at market rate, or below.

Suppliers shall endeavor to pay a living wage.

Fair labour conditions and child labour

No tolerance for any child labour in any stage of the suppliers’ business activities. Suppliers shall

only employ or contract minors in accordance with all applicable laws and regulations. The supplier shall put in place a remediation plan should instances of child labour be found to occur within their own operations or their supply chain.

No forced or compulsory labour shall be tolerated by the supplier or their sub-suppliers. This

includes any labour rendered involuntarily, or voluntarily, but under threat of sanction. No

deductions can be made from workers' wages and no physical or financial sanctions can be used

as disciplinary measures. Workers shall be free to retain all personal documentation at all time, to

remove themselves from a potentially hazardous situation at any point and shall be provided with a copy of their employment contract in a language in which they are proficient.

Suppliers shall secure and uphold freedom of association within the work place. Any autonomous

voluntary association of workers organised to further and defending worker’s rights and interests

shall experience no retaliation from their employers.

All applicable working hours, overtime and night-time work regulations must be complied with.

Environmental management

Suppliers shall identify their positive and negative environmental impacts in a life cycle perspective, meaning impacts stemming from their own operations, those originating in their supply chain and from the use of the products or services which they supply.

Environmental management plans shall be produced to achieve increased positive and reduced

adverse impacts.

Suppliers must demonstrate an adequate environmental management program, preferably

according to international standards such as ISO14001. Such a program must include an approved

environmental policy commitment, defined roles and responsibilities for environmental management, improvement plans, employee training and training records, emergency preparedness and response planning.

Material compliance and conflict resources

Suppliers shall conduct due diligence to ensure that any procurement, use or sale of natural

resources and conflict minerals comply with international standards.

Suppliers shall ensure that any goods provided to FLSmidth comply with requirements covered

under the scope of all relevant standards and regulations securing control of prohibited


Bribery and corruption

Suppliers may not participate in, or benefit from, any kind of corruption, extortion or bribery. This

includes payments to or other forms of benefit conferred on any government official to influence

decision-making, as well as payments to influence FLSmidth employees.

Suppliers must manage information in a manner ensuring that no breaches of FLSmidth’s

intellectual property rights will ensue.

No gifts shall be exchanged with the intention of persuading or in any other way influencing an

FLSmidth employee. Note that FLSmidth employees are likely obliged to report any gift received.

No conflict of interest can occur between the supplier and any FLSmidth employee or entity. Note

that FLSmidth employees are obliged to report any potential risk of a conflict of interest.

Transparency and integrity

Suppliers are expected to transmit the values outlined in this Code down through their own supply chain.

Where supplier non-compliance with the standards listed in this Code is identified, the supplier

must actively inform FLSmidth in order that the gap identified can be assessed and rectified.

Where material breaches of the standards listed in this Code are identified, suppliers are expected to promptly design and implement a remediation plan, including but not limited to instances of child or forced or compulsory labour.

Inspections and corrective actions

Suppliers shall keep a record of documentation of their management systems and practices for the issues listed in this Code. Suppliers shall provide supporting documentation on request, including self-assessment questionnaires.

FLSmidth reserves the right to audit and inspect suppliers’ operations and facilities, including by

third party auditors. In addition to supplier work sites, an audit scope may include residential

facilities for supplier employees and second tier suppliers where specific risks have been identified. The cost of such third-party audits shall be borne by the supplier.

On-site audits and inspections may be scheduled in advance, or may in exceptional cases proceed without prior notification.

Where the results of such an audit or inspection raise non-conformities with this Code, the supplier shall correct or remediate non-conformities according to a mutually agreed Corrective

Action/Remediation Plan and timeframe. Upon request, FLSmidth may assist the supplier to

achieve compliance. Should the supplier fail to implement the Corrective Action/Remediation Plan

within an agreed-upon timeframe, FLSmidth reserves the right to consider this a breach of

contract. This may include, but not be limited to, suspending or terminating the supplier


Access to remedy

As stated, FLSmidth is guided by the UNGPs in our commitment to work towards ensuring

appropriate and adequate remedy for stakeholders adversely affected by our business operations

and relationships. Where such impacts are carried out through a supplier, we aim to work jointly

with the relevant entity to implement a remediation plan according to a set timeline, dependent on the severity of the breach. In instances where this approach is inadequate, affected internal or

external parties may submit a report to the FLSmidth whistleblower hotline.

August 2018

Thomas Schulz

Group CEO,


Quality policy

PDF (336KB)


Our commitment to sustainability is enforced through this policy framework, with Board of Directors' oversight. Operational matters are delegated to the Sustainability Board, chaired by the Chief Executive Officer, who is accountable for continual performance improvements based on informed decisions. Each individual policy is owned by a member of the extended Group Executive Management, who sets targets and has them approved by the Sustainability Board. They are responsible for integrating sustainability considerations into all applicable processes and business functions. They are to enable employees to know, understand and implement the measures required for achieving strong results.


Transparent communication on our sustainability performance is provided through external disclosure of our annual sustainability report. This is structured and presented according to national laws and international standards, with the aim to provide accurate and relevant information for all stakeholders.

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