7. GIFTS, HOSPITALITIES AND EXPENSES

Published : June 14, 2016  /  Updated : October 14, 2020

7. Gifts, hospitalities and expenses

We compete and do business based only on quality and competence. We never provide or accept Gifts, Hospitality and Expenses (‘GHE’) where this is intended to influence the recipient improperly, or where it could create this impression.

The exchange of reasonable GHE is an acceptable way to build goodwill in business relationships. However, it is also recognised that they are sometimes given with the intention of improperly influencing the recipient, and may in some circumstances amount to Bribes. Laws in different countries can vary significantly and we must also be conscious that individuals may be subject to their own internal codes or rules.

Corruption differ based on various factors including business environment, legal jurisdictions and seniority of the involved personnel. Therefore it is always wise to consult Legal if you have doubt or question about the rules stipulated in this Section 7.

7.1 General Principles when Providing or Receiving GHE

Any GHE offered, accepted or provided must:

  • Comply with any applicable laws;
  • Constitute a normal business courtesy, such as paying for a reasonable business meal;
  • Not be intended to influence the recipient inappropriately, to obtain or retain business or a business advantage inappropriately, or to improperly influence or affect the outcome of a business transaction;
  • Be reasonable in value and infrequent;
  • Be made in an open and transparent manner and not under any circumstances in which the GHE need to be concealed; and
  • Be approved as required, accurately and fairly recorded in our books and records.

The following GHE are never appropriate:

  • Where the intention is to get something in return, e.g. a Kickback;
  • In violation of the recipient’s company policy;
  • With a business partner with whom you are in ongoing business negotiations;
  • Cash or a cash equivalent (such as gift cards, vouchers or similar)5; or
  • Adult entertainment or any sort of event involving nudity or lewd behaviour.

As a supplementary guiding rule (unscientific, but often helpful) you can also apply the “blush test” by asking yourself how you would feel if details of the GHE were known by the CEO, your colleagues and made public in a trade magazine or local newspaper? If the result of the blush test is anything else than perfectly fine, you should immediately reconsider the situation.

7.2 Receiving GHE

7.2.1 General rules when receiving GHE

The rules in this Section 7.2 shall always be read together with the general principles when providing or receiving GHE in Section 7.1.

Stora Enso recognizes that it is customary for our business counter parties to occasionally provide small value GHE to those with whom they do business. However, soliciting or accepting excessive GHE is a common way in which conflicts of interest can arise and an employee may put himself in a position of dependence.

Stora Enso employees may accept GHE from business counter parties, provided that the GHE:

  • Is reasonable and will not affect the outcome of business transactions or influence your ability to act in the best interest of Stora Enso, e.g. in the form of discounted products or services for personal gain;
  • Does not create the appearance (or an implied obligation) that the giver is entitled to preferential treatment, an award of business, better prices or improved terms of sale;
  • Would not prevent you from awarding Stora Enso business to one of the giver’s competitors.
  • Is reasonably related to a legitimate business purpose (e.g. accompanying a customer to a local theatre/sporting event or attending a business meal).

Please remember that Stora Enso personnel must always pay their own travel and accommodation expenses when for example visiting a customer or supplier.

GHE that cannot be accepted under any circumstances must be rejected or returned to the provider. You will find a suggestion for a standard letter text for declining an offer on behalf of Stora Enso from the here.

If you receive any GHE at an event of a ceremonial nature (e.g. a customer outing or a commemoration of a business transaction) that might not be appropriate, but it is offensive to refuse, you may accept it and then promptly report it to your immediate supervisor.

Active action

  • GHE that cannot be accepted according to the rules set out above but which are not returned for any reason must be reported to your immediate supervisor.

7.2.2 Restrictive rules when receiving GHE from suppliers

Members to the following teams shall also adhere to a more restrictive set of rules (as explained hereunder) when receiving GHE from suppliers:

  • Group Leadership Team;
  • Division Leadership Team;
  • Group Function Leadership Team;
  • Division Operation Leadership Team; and
  • Mill Management Team.

These restrictive rules are as following:

  • Any GHE or any other positive special treatment from suppliers are, by default, not acceptable unless allowed otherwise hereunder;
  • Gifts shall be returned politely but firmly;
  • Only participate in supplier events with direct business agenda and with interest for Stora Enso. Moderate catering during such events is acceptable;
  • In general, keep supplier meetings to normal work hours;
  • Travelling and hotel costs of
  • Stora Enso
  • employees are always paid by Stora Enso;
  • Stora Enso covers our employees’ costs at business lunches, or keep the business relationship equal through paying every other time; and
  • Suppliers should not sponsor any Stora Enso organized activities.

An employee who is in a position that could affect the result of a sourcing task is also bound by the above-mentioned rules during the sourcing process after receiving separate instruction(s) on an ad hoc basis.

Case studies and best practices

  • Read here for GHE practical examples of what can and cannot be accepted under the rules in this 7.2.2. 

7.3 Providing GHE to External Company Personnel (other than Public Official)

While fulfilling the general principles stated above, providing modest promotional GHE may promote goodwill and serve legitimate promotional purposes. However, under certain circumstances, offering GHE to customers and business partners could violate the law, This Policy or the company policy of the recipient.

Active action

  • All GHE involving external company personnel that are above the sum of EUR 200 per person (subject to lower limits stipulated locally) must be reported to and approved by your immediate supervisor before providing it. If your unit uses Concur for travel reimbursement, a request for such GHE shall be made and approved by your manager. 

7.3.1 Specific Rules for Providing Gifts

  • The rules in this Section 7.3.1 must always be read together with the general principles when providing or receiving GHE in Section 7.1;
  • Whenever possible, Gift shall be Company Giveaways; and
  • In exceptional cases, e.g. at the retirement day of the manager of an important customer, more expensive Gifts can be offered, but you should rarely offer Gifts that are more than EUR 200 in value. Please note that this limit does not mean that Gifts below this amount are automatically permissible or reasonable.

7.3.2 Specific Rules for Providing Hospitality and Expenses

  • The rules in this Section 7.3.2 must be read together with the general principles when providing or receiving GHE in Section 7.1;
  • You may only offer or provide Hospitality or Expenses that is consistent with generally accepted business practices and serves a valid business purpose;
  • The value of the Hospitality or Expenses offered and provided must be appropriate to the underlying business purpose and must not be extravagant; and
  • The Hospitality and Expenses must be offered without creating an express or implied obligation or incentive to conduct business. A representative of each company must be present.

7.3.3 GHE to Spouses

If you and your spouse or partner are invited to, or you plan to invite the spouse or partner of a client or customer representative to, an event at which it is a clear custom or expectation that a spouse or partner are presented, you may then accept or offer such GHE as long as the GHE complies with all the criteria set out above for the acceptance, and does not fall within any of the categories of GHE identified above as inappropriate.

It would not be appropriate to accept or offer Hospitality for a spouse or partner that includes an overnight stay or travel expenses. It is not appropriate for Gifts, other than Gifts of nominal value only, to be accepted or offered if they intend to benefit any family member.

Active action

  • All GHE extended to your spouse or partner, or offered by Stora Enso to any spouse or partner of a client or customer representative must be reported to and approved by your immediate supervisor before providing or acceptance.

7.3.4 Specific Rules for Customer Events

The rules in this Section 7.3.4 must be read together with the general principles when providing or receiving GHE in Section 7.1.

Customer Events are a type of GHE. They normally include travelling, accommodation and other Hospitality. Where Customer Events are of significant value, such as events including travelling and over-night accommodation, the following rules must be observed:

  • There must be a clear business objective for the trip, e.g. to visit and demonstrate a mill or to visit a customer and demonstrate how Stora Enso products are used etc. It is permissible to arrange different kinds of customer activities in combination with the trip, but the main focus should be on business related topics. The event must never be an “excuse” to arrange extensive travelling and hospitality. Document such objective and send it to Legal, Ethics and Compliance;
  • Arrangements under which customers will qualify for participation as a result of a certain volume of business (sometimes known as “customer loyalty events”), present considerable bribery risks and should be avoided;
  • Where the proposed guests are Public Officials, Stora Enso must send a written invitation letter to the public officials, with a clear statement that: “We note that the applicable laws or Code of Conduct may require written confirmation or approval from the department/public authority you work for, before you accept our invitation to the customer events. Should you require any information to obtain this confirmation or approval, including but not limited to the costs or expenses of the event, please feel free to contact us.”;
  • Whenever possible, ask the employer of private sector guests to provide a declaration that the acceptance of the Hospitality will not be in breach of any corporate code or rules that apply to the guest, and that the guest has obtained any necessary approvals;
  • The ratio of Stora Enso staff to customers must be high, at a minimum of 1:2. Such a ratio will indicate that there will be very good opportunities to network and improve customer relations;
  • Record details of the trip, including costs and identity of the guests (including their level of seniority), agenda and meeting minutes, and ensure that there is a procedure in place to avoid the same guests being offered similar trips, or other significant hospitality which would appear excessive if aggregated. Keep the approvals and declarations on file;
  • Include a seminar on ethics. This would achieve a number of purposes: it would be a way of communicating Stora Enso anti-bribery, and ethical policy to its customers; it would provide added business justification for the trip; and, where customers are encouraged to give (non-attributable) feed-back, it could be helpful in Stora Enso monitoring and review of its own anti-bribery procedures. Customers could be invited to present on their own ethical codes. The session should be recorded in the minutes; and
  • Keep the cost of trips under review, and ensure that excessive or lavish hospitality is avoided. The total cost for each customer representative must never exceed EUR 1,500. Customer Events where the cost per guest exceeds EUR 750 must be reported to and approved by the Division head. Please note that these limits do not mean that Hospitality below these amounts is permissible or reasonable. Any expense paid on behalf of the client shall be made directly to the third party service or product provider, and must not be paid by the client first and reimbursed in cash to the client.

Active action

  • Ensure that all the general principles when providing or receiving GHE in Section 7.1 and the specific rules for Customer Events in this Section 7.3.4 are followed;
  • Ensure the total cost for each customer representative does not exceed EUR 1,500; and
  • Customer Events where the cost per guest exceeds EUR 750 must be reported to and approved by the Division head. If your unit uses Concur for travel reimbursement, a request for such GHE shall be made and approved by your manager. 

7.3.5 Specific Rules for Hunting Activities 

7.3.5.1 Invitation

Stora Enso organizes hunting activities with representatives of our customers, wood suppliers and business partners (the “Guests”), and these are divided into two categories:

  • A “Type A Hunting Activity” is a hunt where Stora Enso carries costs related to the organization of the hunt such as hunting consultants and drivers (Sw: drevkarlar) and where Stora Enso also provides food and refreshments during the activity. At a typical Type A Hunting Activity  the Guests  arrive in the afternoon of day one followed by an activity with business related content and light dinner. The following day includes breakfast, hunting, a modest lunch in the forest and a business activity in connection with the dinner in the evening. The Guests  leave after breakfast on day three; and
  • A “Type B Hunting Activity” is a one day hunt, where Stora Enso does not carry any costs related to the organization of the hunt except for land lease costs or the like. At a Type B Hunting Activity  the Guests  arrive in the morning and the day is spent hunting and includes a modest lunch in the forest. In connection with the lunch a business presentation is made. The Guests  leave when the hunt is concluded in the afternoon.

When inviting Guests  you must:

  • Use the specified invitation template;
  • Direct invitations to Guests  employed by a legal entity, to a wider group of people and not to selected individuals (allowing the company or CEO to select those who will attend). However, invitations can be extended directly to individuals who own forest privately, either as a private person or as the single owner of a privately held company (Sw: enskild firma);
  • In the case of a Type A Hunting Activity , ensure that the Guest  or the supervisor, as the case may be, confirms that the participation in the Hunting Activities  is in accordance with applicable internal regulations;
  • Not issue “Plus-one-invitations” i.e. invitations which include a spouse or a friend of the Guest ;
  • Not extend invitations in connection with ongoing business negotiations without approval. If an invitation is to be extended in connection with business negotiations, the matter must be discussed with and pre-approved in writing by Legal, Ethics and Compliance
    ; and
  • Never invite Public Officials unless pre-approved in writing by Legal, Ethics and Compliance.

7.3.5.2 Extent of GHE

  • Travel to and from the Hunting Activities  and accommodation must be paid for by the Guest , but Stora Enso may assist with bookings and reservations if required. Stora Enso may pay reasonable costs for shorter transportation during the Hunting Activities ;
  • Meals (breakfast, lunch and dinner) during the Hunting Activities  may be paid for by Stora Enso, provided that the expenses are reasonable;
  • The value of the Hunting Activities  for the Guest  must be proportionate to the professional relevance of the Hunting Activity. Type A Hunting Activity  must always include an activity with business related content in the afternoon of day one (2 – 3 hours) and in connection with the dinner in the evening of day two (e.g. a business related presentation in connection with the dinner) and also allow the Stora Enso personnel to interact with the Guests  for informal business discussions. A Type B Hunting Activity  must include a business presentation in connection with the lunch;
  • Gifts to the Guests  shall be limited to the Company Giveaways and shall be of modest value;
  • Costs and arrangements in excess of these rules must always be borne by the Guest ;
  • Details about the Hunting Activities  must be documented and filed in order to ensure transparency, compliance with Stora Enso internal regulations and to avoid that the same invitees are being invited to the Hunting Activities  on a repeated and regular basis; and
  • The documentation requirement includes (i) specified costs, (ii) the identity of invitees and Guests , (iii) a copy of the invitation and agenda, and (iv) meeting minutes of activities of business related content.

Active action

  • Ensure that all the general principles when providing or receiving GHE in Section 7.1 and the specific rules for Hunting Activities  in this Section 7.3.5 are followed;
  • If an invitation is to be extended in connection with business negotiations, the matter must be discussed with and pre-approved in writing by Legal, Ethics and Compliance;
  • Obtain pre-approval from Legal, Ethics and Compliance
    before inviting any Public Officials; and
  • Send documents required in this Section 7.3.5 to Legal, Ethics and Compliance
    whenever they become available.

7.4 Providing GHE to Public Officials

7.4.1 General Rules

The rules in this Section 7.4.1 must be read together with the general principles when providing or receiving GHE in Section 7.1.

When dealing with Public Officials, even small, bona fide, legitimate GHE may be misinterpreted as illegal bribes. Nothing of value must ever be offered or provided for the purpose of retaining or obtaining business or some other advantage.

It is acceptable to provide ordinary business courtesy Hospitality of nominal value, such as tea and coffee, a sandwich lunch where the Public Official is attending a meeting at your office or other non-excessive Hospitality when hosting a visit from a Public Official. If you are hosting a visit from a very senior Public Official such as a government Minister, it is acceptable to provide a level of Hospitality that is appropriate to his status. There should never be any suggestion, or perception, however, that the provision of Hospitality is intended to influence the Public Official. For the sake of clarity it should be noted that Hospitality offered to Public Officials (as well as to private individuals) may never be exchanged for cash.

Public Officials are frequently subject to their own strict guidelines or codes, or to legislation. Where feasible, you should take steps to ascertain what the guidelines or applicable legislation permits or requires and ensure that any Gifts or Hospitality you offer complies with such guidelines or legislation.

For example, if you know that a member of parliament is required to declare any Gifts he receives over a certain value, and to decline Gifts over another value, you should avoid offering a Gift that is worth more than the higher value. If you give a Gift which is over the first value you should check that disclosure / registration requirements are complied with to the best of your ability. If the records are not publicly available you should ask the individual (or his office) to confirm that the necessary requirements have been met.

Active action

  • Obtain pre-approval from Legal, Ethics and Compliance
    before providing GHE to any Public Official that does not meet the criteria listed in this Section 7.4.1, with the exception of GHE of very low value (e.g. a pen or notebook to use at a meeting, tea, coffee etc.).

Case studies and best practices

  • Read here for GHE cases studies and best practice advices.