CNH Industrial’s relationship with local communities is a key material aspect, as emerged from the materiality analysis. Living and working in synergy with the region, and collaborating on projects that benefit the community, contribute to enhancing the satisfaction of employees (who often live close to plants) and their sense of belonging to the Company, while bringing economic advantages to both the Company and the community.
As evidenced by the materiality analysis, stakeholders view this aspect as a site-specific issue since local community initiatives are more relevant in certain countries than in others. Local initiatives are also deemed potentially strategically powerful when integrated within a shared value strategy. Stakeholders highlighted the importance for a company like CNH Industrial to act like a corporate citizen, be more embedded in the community, and become part of it, acknowledging, however, the major challenge of being recognized as a community member. In order to achieve this objective, a company should enhance local economic competitiveness by offering, for example, the professional support of its skilled employees to career counseling centers and educational initiatives. It should also contribute to community revitalization and to the efficiency of public works investments, as well as safeguard rural landscapes.
As stated in the Code of Conduct, CNH Industrial is aware of the potential direct and indirect impact of its decisions on the communities in which it operates. For this reason, the Company promotes an open dialogue to ensure that legitimate expectations of local communities are duly taken into consideration, and voluntarily endorses projects and activities that encourage their economic, social, and cultural development. Moreover, CNH Industrial acts in a socially responsible manner by respecting the culture and traditions of each country, and by operating with integrity and in good faith to earn the trust of the community.
The strategy developed by the Company, in line with its business approach, identifies the following as key priorities: support for local community development, youth training, and road safety. Within these three directives, the individual Regions or brands decide which projects to support based on actual local needs, maximizing open dialogue with local stakeholders and collecting their suggestions for improvement. They also decide whether to act directly or through partnerships with local institutions and organizations working in the social sphere.
The Community Investment Policy, available on the Corporate website, ensures that activities are managed consistently, identifying methods and defining areas of application at global level.
A new Compliance Helpline was established to address questions and concerns regarding CNH Industrial principles, as outlined in both the Code of Conduct and in other Corporate policies, and applicable laws; the Helpline is managed by a third party and is also available to entities outside the Company (for further information, see also page 57).
Many of the volunteer projects for the welfare of local communities are listed in the Sustainability Plan (see also pages 33-34), and some of their targets are included as individual objectives in the Performance and Leadership Management system (see also page 83).
Projects and their results are included in the following pages of this Sustainability Report, on the Corporate website, and on other dedicated websites.
The effectiveness of an initiative and its ability to address needs is measured using the Social Impact Assessment tool; developed in line with the London Benchmarking Group framework, it is used to evaluate the types of benefits gained in the four major areas potentially affected by any project: people, organization, environment, and business.
Based on this method, the four areas are weighted and the project’s impact on specific aspects within each is given a rating on a scale from one (no impact) to five (very high impact). An average rating is then calculated for each area, representing the indicator (KPI) to assess the project’s overall impact on people, organization, environment, and business, respectively. The assessment, applied to a broad number of projects in 2014, is carried out by the people responsible for the initiative being evaluated.
SOCIAL IMPACT ASSESSMENT CRITERIA
SOCIAL IMPACT ASSESSMENT OF MAIN PROJECTS
|Region involved||Project||Evaluation of Benefit to:|| Reference|
|NAFTA||Habitat for Humanity||2.3||2.6||(a)||3.1||117|
|NAFTA||Relay for Life (American Cancer Society)||2.3||3.6||(a)||3.4||117|
|LATAM||Cooperação para o Desenvolvimento e Morada Humana||3.1||3.0||2.2||3.1||119|
|LATAM||Esporte da Cidade||3.2||2.2||1.7||2.6||120|
|LATAM||Pastoral do Menor||3.5||2.1||1.8||2.5||118|
In 2014, CNH Industrial allocated approximately $4.7 million1 for local communities. In certain instances, the Company supports the community by allowing its employees to undertake voluntary activities during working hours (around $287 thousand), in addition to directly distributing economic contributions or donations in kind. In 2014, CNH Industrial prioritized investments on developing communities around Company plants (approximately $2.2 million), a demonstration of its desire to foster positive long-term relationships with the communities in which it operates.
Most resources were allocated to LATAM, with approximately 44% of the total, followed by NAFTA with approximately 36%. Of the community initiatives supported worldwide, 58% were social projects, 21% focused on art and culture, and 10% on young people’s education.
CONTRIBUTION TO LOCAL COMMUNITIES
CNH INDUSTRIAL WORLDWIDE
(1) Investment data for local communities is based on accounting data and calculation methods, and also includes estimates. Figures in currencies other than dollars were converted at the exchange rate as at December 31, 2014. The stated figure also takes into account the cost of employee time to manage and organize humanitarian initiatives promoted by the Company, and does not include initiatives solely focused on brand promotion. Figures relate to all CNH Industrial legal entities worldwide.