Suominen operates in a responsible and globally aligned manner. We want to support responsible operations in our supply chain and in society at large by respecting human rights, being a good corporate citizen and mitigating environmental impacts caused by our own operations.
Suominen is a global company with operations on three continents. We collaborate with a significant number of stakeholders in a multicultural environment every day. With global operations we provide employment and business opportunities to a wide range of stakeholders. We promote transparency in our communications with our stakeholders and strive to ensure that all our operations are carried out in a responsible and globally aligned manner.
Our daily operations are guided by Suominen’s Code of Conduct and other related policies. These create the foundation for our sustainable business practices. We expect our business partners to act responsibly and to comply with our Supplier Code of Conduct. Read more about the Code of Conduct.
Suominen’s stakeholders are entities or individuals that have an impact on or are affected by our business. Our stakeholder groups differ greatly and the focus areas and the channels of communication vary according to the stakeholders’ needs.
Continuous interaction with our stakeholders is a key aspect of Suominen’s approach to sustainability. Stakeholder dialogue provides important insights into the expectations and concerns our stakeholders have and helps us to identify the opportunities and risks in
our operating environment. We want to engage in open and continuous dialogue with our stakeholders and strive to transparent communication through various channels.
In 2019 we conducted a public web-based survey for all our stakeholders.The purpose of the survey was to assess the expectations of our stakeholders and to collect information and insights into how we can develop our sustainability work further. The web-based survey was supplemented with in-depth interviews with selected key stakeholders.
In the survey results our stakeholders addressed the importance of sustainability, which was seen as a combination of environmentally and socially responsible operations and eco-friendly products. All stakeholder groups addressed the importance of a sustainable product offering. In addition, our customers underlined product safety and performance. Employees emphasized areas close to their work, such as employee health, safety, and development. Shareholders highlighted environmental areas such as circular economy and sustainable production and supply chain.
Suominen Group’s tax footprint represents the economic impact on society arising from Suominen’s operations in the countries where it operates. Suominen’s business operations result in liabilities to pay taxes and similar payments, as well as in a liability to collect and remit taxes and similar payments that arise from the business activities of the group companies.
Suominen has not entered into any arrangements aiming to change or rearrange its tax burden from what results from normal business operations. The trading of goods between Suominen group companies is extremely limited. The group companies receiving intra-group services are charged a service fee. The pricing of the service fee is in line with the arm’s length principle.
Suominen has companies in the five countries – Brazil, Finland, Italy, Spain and the United States – where it has both production and sales operations. With respect to taxes and similar payments, Suominen applies the laws and regulations of each country.
The main markets of the Finnish group companies are abroad. Due to this, the export sales of these companies significantly exceed their domestic sales. No value added tax is levied on export sales. This leads to a situation where the Finnish group companies’ deductible value added tax on their purchases subject to value added tax is considerably higher than the value added tax they remit based on their taxable sales. As a result, Suominen receives a refund of value added tax in Finland.
Suominen’s tax footprint includes not only the taxes and similar payments that are group companies’ costs, but also the taxes and similar payments which the group companies collect and remit, such as indirect taxes. Deferred taxes which arise from the timing differences between taxation and accounting and are recognized in accounting are not included in the tax footprint.
In 2019, Suominen employed on average 685 people in its operations. As a result, Suominen generated a positive economic contribution to the surrounding society in the form of employees’ income taxes, as well as social security contributions both by the company and the employees. Thus, Suominen’s tax footprint includes also the collected and remitted employees’ income taxes as well as social security contributions, but the employer’s taxes are clearly separated from the employees’ taxes and payments in the report.
Suominen’s corporate income taxes are significantly affected by tax losses generated in the past in certain countries where Suominen operates. Based on local tax laws and regulations, tax losses are carried forward and deducted from the taxable proﬁts generated in the future. At the moment, Suominen’s taxable result does not incur corporate income tax payments in Finland, as it has tax losses carried forward from past years. Suominen is subject to group tax consolidation methods in several countries based on each country’s tax laws and regulations, which effectively means that Suominen’s local companies are taxed on the local consolidated taxable income.
The corporate income taxes Suominen pays in the USA are impacted by local tax incentives, which allow companies to deduct up to 50 or 100 percent of the acquisition cost of the investments taken into use during the year as accelerated tax depreciations. As Suominen made a large investment at the Bethune plant in South Carolina, the effect of the accelerated tax depreciations decrease the combined taxable result of the American subsidiaries also in 2019. The use of the accelerated tax depreciations decreases the taxable result of the year in which they are utilized and defers the payment of corporate income taxes into the future. The utilization of the accelerated depreciations will decrease the tax-deductible expenses of future years and concurrently increase the taxable result as well as the paid corporate income of those years.
The group companies also pay property and real estate taxes based on the land and buildings they own, as well as different fiscal payments levied on e.g. manufacturing operations. In addition, there are some levied taxes, for example in Brazil, that are based on a percentage of the company’s net sales. Suominen does not consider these as indirect taxes to be collected and remitted, but as taxes that are costs for the Group companies.
|EUR thousand||Finland||Other countries||Finland||Other countries|
|Corporate income tax, tax on profit *||0||-1,351||4||-1,633|
|Corporate income tax, tax on turnover||-||-1,474||-||-1,129|
|Employer contributions and taxes||-1,490||-9,925||-1,537||-9,292|
|VAT as expense||-20||-2||-30||-34|
|Customs duties on export***||-||-23||-||-83|
|Customs duties on import***||-606||-1,792||-622||-2,306|
|Other taxes and similar payments||-25||-203||-35||-191|
|EUR thousand||Finland||Other countries||Finland||Other countries|
|Payroll taxes and similar payments collected
|Withholding taxes on various payments||0||-114||-406||-133|
|Other taxes collected and paid||-||-7||-||-13|
* Corporate income taxes do not include any deferred taxes.
** Taxes on real estates.
*** Customs duties are borne by the company importing or exporting goods and not collected and/or paid by some other tax payer. For these reasons customs duties are reported as taxes borne.
In all our activities, we adhere to high ethical standards. We keep our promises and develop our stakeholder relationships in a fair and responsible way. We are committed to full compliance with all applicable national and international laws, regulations and generally accepted practices. Suominen refrains from all unfair business practices, such as fraud, corruption and bribery. The company has a whistleblowing practice established with an external partner.
Suominen is committed to the United Nations (UN) Guiding Principles on Business and Human Rights and the International Labor Organization (ILO) Declaration on the Fundamental Principles and Rights at Work. In its Code of Conduct Suominen commits to respecting human rights as an employer. Suominen does not tolerate any kind of discrimination, any form of forced or compulsory labor, or the use of child labor.
Suominen works consistently to ensure that human rights are respected across the value chain. Suominen requires its raw material suppliers to commit to ethical conduct, full compliance with all applicable national laws and international treaties, and to respect human rights as set forth in internationally recognized standards and treaties.
Suominen’s Code of Conduct describes the practices and principles adopted by the Suominen Corporation and its subsidiaries and it addresses issues such as fair business practices, financial regulations, human rights and environment. Suominen requires all its employees to comply with the Code of Conduct. Suominen’s Code of Conduct will be updated in 2020 and we will launch a new mandatory training program for all employees in 2021–2022.
Our requirements for our suppliers are described in the Supplier Code of Conduct, which discusses issues such as wages and working hours, child labor and forced labor, and the environment. The Supplier Code of Conduct was upgraded in 2018 to better address human rights as well as corruption and bribery.
At the moment, 85 percent of our suppliers comply with the upgraded Supplier Code of Conduct. In accordance with the renewed sustainability agenda, our target is that 100% of raw material suppliers have signed our Supplier Code of Conduct by the end of 2020. In addition, we aim to establish a process for third party supplier sustainability audits.