At last year's conference, we were pleased to have successfully concluded the monitorship program. This year, we made further significant progress by having introduced ESG criteria in the management remuneration system and having created a section on our own IR website where we inform you about the Volkswagen Group position on major ESG controversies in order to proactively deal with market and rating agency concerns. Last but not least, we were very pleased to re-enter to the UN Global Compact, which for many of you is a prerequisite to investability. With that in mind, we earned a small MSCI upgrade, still at a very low base, but the trend is in the right direction. We have also substantially increased our dialogue with rating agencies since we have learned the importance of this lever. We are currently working on embedding ESG even more in our new strategy, updated Group NEW AUTO.
Furthermore, our Volkswagen Group Board Member for Purchasing, Murat Aksel, has also created a new department responsible for global development of risk management and sustainability, reporting directly to him effective 1st of September this year. With this step, sustainability within the purchasing will be pushed forward even more. The motto is sustainability at scale and acknowledges the huge importance of using our size to bring sustainability into our own supply chain and have a global impact. We intend to include more measurement and performance management and in all areas of ESG in order to strengthen trust among stakeholders and in the financial market. Our four focus areas have been defined as decarbonization, circular economy, responsibility in supply chains and the economy, and of course, transformation of our workforce.
We are actively driving the change towards emission-free and digitally networked safer mobility and want to be a leader in sustainable growth, taking into account the interests of our stakeholders. To achieve this, we are pursuing two transformation goals. First being go to zero. We're committed to the Paris climate goals for 2050 and have an extensive decarbonization program and want to make our entire group CO2 neutral by 2050 at the latest. To do this, we are electrifying our vehicle fleet, increasing resource efficiency in production, and promoting the use of renewable energies. We have linked our sustainability narrative and its four focus areas with the sustainable development goals of the United Nations. The result was number 13, climate protection measures identified as a priority goal, followed by five other priority goals, seven, eight, nine, 11, and 12, that cover our complete value chain.
Furthermore, Volkswagen Group is clearly committed to respecting and safeguarding human rights within its sphere of influence. We have anchored this principle at board level and in our corporate strategy and decision-making. Last November, the Volkswagen Group Board of Management and the Group Global Works Council signed the declaration of the Volkswagen Group on social rights, industrial relations, and business and human rights. We also welcome the adoption of the Supply Chain Act in Germany, and we look forward to the European Union draft law on harmonizing human and environmental issues in which Volkswagen representatives have also actively participated. Wherever we do business, we always export our corporate culture and standards and values. In our sales and production locations, we are guided by the UN Guiding Principles.
At Volkswagen, we also express it in our code of conduct, a group-wide code that not only defines our responsibility as a business partner for suppliers and in the workforce, but also our responsibility as a member of society. During the course of the year, we have participated in a good number of sell-side ESG conferences as well as many investor one-to-ones. The valuable feedback received has enabled us to focus even more on your most relevant ESG issues. Today's conference will be held in three distinct blocks with key Volkswagen Group experts. To start off with Tobias Heine, who's from our integrity department. He will report on our progress on the status and strategy of Together for Integrity.
We then will have Elke Heitmüller, who is our Head of Diversity Management, and also joined by her colleague, Anika Dominik, who is also a Group Diversity Manager, and they will present diversity and inclusion from the VW perspective. Diversity and integrity are two of the new key parameters for our board remuneration scheme. For time management reasons, we are going to combine the two Q&A sessions, which will mean integrity and diversity will be held in the same Q&A session. We then follow with the second area, where Torsten Briam from Volkswagen Group Public Affairs will discuss responsible lobbying. After that, Daniel Roth then takes on sustainability management and decarbonization. Both will again hold a combined Q&A round.
Last but not least, Dr. Antonios Goros will provide our company perspective on business human rights, and for that Q&A session, he will be joined by Daniel Göhler, Head of Sustainability Strategy Procurement. We, of course, hope that this conference will be very informative and valuable for you. We look forward to your active participation, for your questions, and as well look forward to your feedback afterwards. With that, I'd like to hand over to Tobias to kick off today.
Good day also from my side. My name is Tobias Heine. I'm responsible for Together for Integrity program. On the first slide, I would like to show you the agenda of the next 20 minutes. At first, a brief overview of what are we doing with Together for Integrity, where do we stand. To go then into a deep dive of our key initiative, Integrity. Finally, one of the most important parts, how do we measure the impact of what we are doing? Is it reaching the working life reality in Volkswagen Group? On the next slide, you can see Together for Integrity is our holistic integrity and compliance program. With this, we are bundling all activities of integrity, risk management, culture, and integrity risk management, compliance and culture. On the next slide, you see our approach.
On the one hand, we have got a lot of processes along with structure that we are implementing, but at the same time, it is the same as important, we have to reach the minds and the hearts of the people in the Group that actually the processes and the structures take place and become effective. On the next slide, you see the reach of the processes that we are implementing. We call them key initiatives. In total, 11 this are. I quickly guide you through. At first, HR compliance, policies and procedures. What it is all about. When we are hiring people, when we have the annual performance appraisals, when we have got promotions, we are constantly seeing whether the people are applying our values of integrity and showing them. That is now a systematic part.
The code of conduct is the basis of how we work together, and the integrity program is our information and education program on integrity. Of course, risk management and controls is also a part, as well as internal compliance risk assessment. What is internal compliance risk assessment? It is our regular review of in the business areas, whether the activities are still in compliance with the actual laws and regulations. We all know we are in a complex world and regulations can change, and therefore this review is very important. Also, the whistleblower system is an important pillar of our integrity and compliance management system, as well as our activities for mergers and acquisitions, as we want to ensure that when we financially invest in another entity, that we properly know the risks as well as the benefits we are getting into our Group.
Not necessarily only financial relations we are focusing on, but also on our partners with whom we work together. Business partner due diligence in the upstream with our suppliers, especially, of course, when we see the electrification of our products. For example, we want to ensure that no child work is included in our products. Downstream, we also want to ensure with the business partner due diligence, that we are only working together with partners that sell our products on the one hand, and at the same time that they share our values and our perspective on integrity and compliance. The product compliance, of course, is also a key cornerstone of the integrity and compliance program as we have to ensure that our products comply with the regulations across the countries where we are applying and selling them.
The environmental compliance is our cornerstone to ensure that our production sites are within the boundaries of the laws. It is also our lever for the Paris Agreement to ensure that our products are not only electrified and carbon free on the road, but also that on a perspective we get them on the road carbon free. Anti-corruption, to round it up, is the final but also a very important cornerstone of the 11 key initiatives. They are all bundled in a central toolbox, which on the next slide you can see we are rolling out to the entities within Volkswagen Group. We have started in 2018 with four companies, Volkswagen AG, with the Volkswagen brand, of course, Audi AG and our activities in the U.S. 2019, approximately four entities per calendar week were hooked into the system.
In 2020, we have scaled massively up to seven entities per calendar week we got into our project. Despite Corona, we have been able to roll out. Until end of 2022, 850 entities will have been brought into our system, and the program is running until end of 2025. Why does it take so long? Per entity, we expect 3.5-4 years of implementation time because it is really a lot of processes under the 11 key initiatives that we are implementing. Here you also see the commitment of the Volkswagen Group Board with how much these 11 key initiatives and such a long breath these key initiatives are implemented in the Group. On the next slide, it would be a deep dive now into the key initiative integrity. On the following, you already see what is integrity for us all about.
Integrity consists of four areas. On the one hand, the personal integrity that we want to foster with our employees. Here we have got two areas where we especially focus on. Of course, leaders, because every leader is a multiplier and is creating influence in the organization. Here we address especially with integrity skill set, on which I will elaborate in the following slides a little bit further. Also, of course, we are focusing on all employees to empower them on open discussion to assess risks and to decide boldly and to be an active contributor to enable speed for change. Although every employee within the organization is making personal decisions, also we as an organization behave, and therefore, on a second focus area, we focus on the organizational integrity. How is the organization behaving? How is it acting on the market?
How does the corporate take decisions within the boundaries of integrity and compliance? Which is guiding me already to the next part, integrity as a value-driving asset. We strongly believe that integrity is an asset on the market. The society does not expect only companies that are producing great products, selling them, and making a profit. It is expected that the company has a purpose and is an active part in the society. Also, in regard to the purpose, not only to the society but within the Group, we also believe that integrity drives the purpose and the mindset change and is also a transformation lever. On the next slide, a brief drill into the integrity skill set. What are our goals? We want to enable our managers to lead in a value-based and responsible manner to act as a role model.
At the same time, to stress the importance of integrity when making decisions and to promote an open and professional approach to mistakes and dealing with misconduct. Here, we have included the skill set already in the management development programs of Volkswagen Group, and we are scaling this in the next 14 months to the brands of Volkswagen Group. On the next slide, a brief deep dive into how do we measure organizational integrity. Here, we have developed an integrity index. You see the dimensions that we are measuring, compliance and infrastructure, climate and integrity culture, products and customers, society, partners and markets. Basically, in all of this dimension, we are asking the question at first, do we have got a commitment that is not only verbally but based on a written organizational commitment?
Second, is there a process that ensures that this commitment actually takes place and is implemented? Third question, how do we act if this commitment is not complied with? For example, we have made strong improvements on the area of animal welfare because we have identified that we are doing there a lot, but we do not have a written commitment. So this organizationally, we now have anchored much stronger, and it helps us with NGOs like PETA in our discussions on animal welfare because we are able to keep our word in regard to what we want to do. On the next slide. It's a little bit strange for the eyes, but you can see in the center how we are addressing the different bodies within the organization.
On the one hand, we have got certain activities focusing on the board, of course, the Group Board, but also the boards of our daughter entities, 850, which we consider in our rollout. We, of course, also address the management and altogether all employees. It's not required to go here into the details, but we have got a very detailed approach for all the stakeholders within the organization to address them, to send the right tone from the top, for example, to make the people participate in dialogue discussions and to bring the change into the organization. On the next slide. Impact measurement. Here's the question, of course, or you will probably have asked yourself, is it all pretending what we are doing, or is it actually making a change in the working reality of the people? To measure this impact, we have developed certain activities.
We have got pen and paper surveys, for example, the annual Stimmungsbarometer with all employees. We have just carried out an integrity and compliance survey with 50,000 employees participating. But we are also fostering these measurements with detailed workshops, so-called perception workshops. What are we doing here? With every entity where we start with our T4I activities, we have got an initial measurement. We are inviting up to this, depending on the size of the organization, up to 150 participants, randomly selected, but at the same time, also representative for the organization. Takes approximately half a day, 3-4 hours of time. Initially, how does it look like? Opening with a keynote speech of a CEO or another board member, describing in detail what are we doing with Together for Integrity, and then coming to voting and to discussion on, in total, 17 statements.
These 17 statements you see on the following slide. Here you see the questions where the people can, in the room, all together, with a mobile phone app, can vote to each and every question their agreement rate. From 1, I completely disagree, to 5, I completely agree. The results are discussed with participating board members about what is especially good or where is the voting result especially bad. Why do we do this? On the one hand, to gain transparency on where do we stand. Are the topics really getting into the working life of the people? To reduce, second, the distance of power within the organization and, third, also to make transparent and tangible for the board members where issues on integrity and compliance are lying in the daily working lives of the people.
Here, one question, for example, 1.2, integrity and compliance issues are discussed in meetings along with current issues. Is it really a topic that is on the agenda, or is it always at the very end and only addressed when we have got time? Another question, 2.2. Anyone who points out the risk of rule violation and looks for solutions is given credit for doing so. Here, we very often have discussions on how honest our traffic light reports are. Is a yellow traffic light really a yellow traffic light, or when we dig a little bit deeper, could it be also red? Sometimes we then see that the discussion might tend more on how can it happen that there is a red traffic light instead of what can we do to remove the red traffic light.
In such a climate, the people, of course, try to or may try to tend to avoid a red traffic light as much as possible, which in turn leads to a reduced lead time to mitigate the risks. Those are topics that we are bringing on the table in these discussions. We do this in every entity when we start with a program, and we continue these measurements on an annual basis until the last key initiative is fully implemented. Approximately three and a half to four years implementation time means approximately four times we have got the measurement in the organization, which means that per year, approximately 15,000 people and voices we get into the voting, and we see, is it making an impact or not. On the next slide, you see our approach. We have got the initial perception workshop.
We have got activities between the recurring perception workshops, and then the recurring perception workshop on an annual basis. On the next slide, you see the actual voting results or re-voting results that we have gathered. On the entities across different or exemplary selected countries, you see that although the people can vote from one to five, completely disagree to completely agree, that the interval in which it's voted is relatively small and lying between 3.2 points and 4.7 points. With this, we can see that the recurring measurement, which is marked here with a gray bar, that it's in all cases higher than the initial voting. Sometimes we have got a steady state on a very high basis, and we are not chasing for specific numbers. We want that the trend goes up and that we can see that our activities actually make a change in the organization.
That is an update on Together for Integrity, our integrity program, and our measurement to see whether we are on the right track. Thank you very much.
Thank you very much, Tobias. I'd now like to hand over to both Elke and to Anika to update us on where we are with diversity in Volkswagen.
Yes. Thank you, Helen. I'd like to present the topic D&I at Volkswagen Group. Thank you for having me. As the title suggests, the first chart, please. We have transformed ourselves from local women's advancement in Germany to international and group wide diversity management. The starting point of the transformation was 2017-2018. During these years, the international diversity strategy was developed. The challenge of group wide management is to strike a balance between centralized control and meeting local site requirements. In order to be able to manage with international diversity managers, has been appointed throughout the group. In addition, we live diversity was also anchored in our Group Essentials. A total of seven Group Essentials build the foundation of the group's values and the basic of our common corporate culture. In 2019, we launched the Diversity Wins @ Volkswagen program.
Diversity Wins is a two-part mandatory awareness training that every manager in the group worldwide attends. From last year, we now report directly to Gunnar Kilian, the Member of the Board of Management for Human Resources and Truck & Bus. This year, we have continued to develop group diversity management. For example, diversity is anchored as a core topic in our new group strategy, NEW AUTO. We also continue to work on the further expansion of diversity governance and the internationalization of performance management. As you can see in the next chart or slide, in order to make our guiding principles and our values towards diversity and inclusion visible and accessible to the entire staff, we have developed a mission statement from group diversity management. The cultural change of the organization can only progress if diversity and inclusion is part of our DNA and we all live diversity.
We stand up for it every day. When the right person is in the right job, at the right time, in the right place, regardless of gender, cultural background, sexual orientation, or other diversity dimensions, then we can say that diversity and inclusiveness has been achieved in the company. To reach this, we have developed a holistic approach consisting of three levers. Tone from the top, workforce, and company. I will introduce this holistic approach in detail later, because only together can we say we live diversity, and only together we drive diversity. Next slide, please. I like to show you our vision. Our goal is our leaders live diversity. Therefore, we at Volkswagen implemented the Diversity Wins program, because it is diversity in the very beginning. Diversity focuses on talent and experiences to make sure that the right person is in the right position, I said it.
Diversity fosters employee attractiveness. For me, the most important is diversity creates an equal environment. To make it more clear, diversity and inclusiveness is not only being invited to a party, but also asked to dance. Diversity, that is a good side effect for our company, strengthens also customer orientation and innovation. In order to achieve our vision, we are continuously working towards these goals. First, very favorable increase in diversity via the Stimmungsbarometer and Group Diversity Index. Secondly, the concentration on dimensions such as gender and internationally as a first step. The third point is transparent HR processes and setup of equal opportunities. Fourth, brands, entities, and departments live diversity according to their business mission. The fifth, Volkswagen reflects diversity in all appearances, publications, and advertising measures.
Down below, you can also see our focus and tools. We come back to it a little bit later. I would like to emphasize that we are continuously working on the further development of these tools and measurements, and regularly review our focus topics. On the next slide, you can see, as we understand diversity as a holistic approach, we implemented diversity in our DNA, which means that you will find it in the most of our regulations, strategies, and KPIs were group-wide. For example, it is a part of the Group Essentials as well as of our leadership model and the Code of Conduct. What means living diversity? For these reasons, the Volkswagen Group's diversity strategy takes the strictly holistic approach. We have minimum standards worldwide, which we track by means of a diversity index.
We are committed to ensuring that our HR processes are fair and free of prejudices. We offer training for managers and employees, and we contribute to remaining an attractive employer for future generations. Our experiences shows us that standalone measures will not be enough. Therefore, we focus on three core elements. First of all, we need actions from the top. Leaders who are highly committed and walk their talk. For example, we will use our board members as testimonials for communication activities. Second, the second step is to implement intensive training across the entire group. The role model program for the planned trainings are Scania Skill Capture Lab. Here you see one of our biggest advantages, our different brands in the Volkswagen Group. It is about experiencing the importance of diversity and define concrete action plans to our future business. The third, how do we do that?
This is part of the third step, nudging. Nudge management is about analyzing key moments and processes, identifying behavioral pitfalls, and implementing measures to change behavior. We have to measure the progress, and that means the diversity index. With the conception of this index, we have made another important contribution to making our existing diversity in the company even more transparent and comprehensible, and due to making the impact of our diversity activities in the group measurable. The index was introduced in 2017 and included the KPIs, women in management, and internationalization in top-level management. This year, the index will be upgraded. The new Diversity Index 2.0 will be expanded to additional KPI to measure inclusion. The diversity index measures employee structures to the entire global Volkswagen Group. Our diversity index targets are to achieve 20.2% women in management and 25% internationalization in top-level management by 2025.
Additionally, the diversity index is part of the remuneration system for Group Executive Board members and for the first time from 2021. We are confident that we will achieve our group target. For the next topic, a deep dive in our Diversity Wins program, I hand over to our project lead, Anika Dominik.
Thank you very much, Elke. Independently from implementing the gender quota and more internationalization, what would be one of the best ways to make diversity and inclusion being lived more in the company? Diversity Wins @ Volkswagen is our mandatory group program for all leaders at all levels, from foremen up to members of the board. It is about raising an awareness for diversity and inclusion for the entire staff. It is about addressing the right target group within the first place. Reaching out to numerous employees with key functions who have crucial influence on fair decision-making, guiding diversity, and be a role model, these are the leaders. Elke said it, in 2019, we started launching the program. We started with training multipliers, and those multipliers are highly motivated Volkswagen employees, interns who committed themselves to be ambassadors for D&I.
These ambassadors, they train leaders across all brands, all entities, and all sites. You can imagine what impact it has within the organization. So far, we have trained more than 22,000 leaders. Besides creating an awareness for the challenges and chances of D&I, the practical implementation ensures the success of such a program. How do we do that? You can see on the next slide. The main objectives of Diversity Wins @ Volkswagen deal with the question of how to achieve an inclusive culture and how to get it into action. As a first step, we take a look at the question, why does diversity do matter? It is not only for better teamwork, but it is also a business case and an enabler for transformational processes within the company.
As a second step, we focus on topics such as the role of a Volkswagen leader, then how to create a psychological safe working environment, being aware of unconscious bias, and as we heard before, nudge management. Nudge management is the concept on how to initiate smart decisions. It is about taking decisions that are not influenced, e.g., by unconscious bias, such as the mini-me effect or stereotyping. The overall concept of Diversity Wins @ Volkswagen is well-received as a practical and less complex way of implementing small and bigger measures. Those measures could be, e.g., improving the cooperation within the team or optimizing processes. Diversity Wins @ Volkswagen could be seen as a benchmark. It has an impressive range. Nevertheless, the awareness of the program can only be the start. What would be our sustainability concept?
On the slide, you can see various concepts. It is a mix out of strengthening diversity competence by diversity modules in different programs, and these we offer face-to-face and digitally. It is about strengthening specific target groups which have a big influence within the company. These D&I modules can be seen as follow-up offers on Diversity Wins @ Volkswagen. Inclusive leadership is an important part in our leadership development programs, but of course, eventually, we address the entire workforce. Elke Heitmüller will now speak about the newly established diversity panel, which deals with the challenging topic of individual and structural discrimination.
Yes. Thank you, Anika. As Group Diversity Management, we are committed to making diversity and inclusion more of a lived practice in the company. This year, Anika said it, we have established a diversity panel with internal and external experts on racial diversity. We are happy that we could gain notable members for the panel. As you can see on the slide, the external expertise is key for our company to proceed with the right and fitting measures against discrimination in all forms. What is the aim? The panel is to raise awareness of political and social developments and to provide advice on critical content. In this way, in-house competence is to be successfully developed. We want specific measures that will be implemented at several levels of the company. The panel supports Volkswagen in consulting and making recommendations for actions.
In doing so, Volkswagen assumes its overall social responsibility to represent and live its ethical values both internally and externally. You can see our focus topics. We want to sensitize the whole Volkswagen staff for racial diversity and, thus, fight everyday discrimination effectively. This works with a strong tone from the top, as I said, in our holistic approach, how important this is. Our managers serve as role models for diversity and inclusion. This quote represents the strong commitment of the company's board. Gunnar Kilian and also Klaus Zellmer are also part of the diversity panel. As Gunnar said, "Diversity and equal opportunities empower our innovation and unleash the potential of our employees, the people management. This strengthens our company and contributes to our company's success.
At Volkswagen, we truly live diversity." Klaus Zellmer, the board member for sales, marketing, and after-sales at Volkswagen Brand, emphasizes that our working environment must fundamentally be reflected in society, which is increasingly diverse. This is the only way we can meet the demands of our customers. A good example of that, he walks his talk, is the UEFA EURO 2020. At the European Championship, Volkswagen made a colorful statement for diversity and tolerance on advertising boards and our electrical ID.3 in rainbow colors as a ball carrying car. In this way, we will continue to send a visible signal to society in the future. Also an example. We have a very colorful recruiting campaign, and Volkswagen strives not only to make a better use of the diversity in the workforce, but also to further increase it.
With its campaign, Software is female, in 2019 and 2020, Volkswagen was a first mover to change the image in a field that no other car brand is so consistently occupying. Volkswagen's plan for transforming the Group into a software-driven mobility company will only be successful if we can attract the best experts for us. In the past, we weren't so good at targeting visionary women. That's why we are actively changing our recruiting methods with campaigns like these. For example, the campaign was deliberately placed in women's magazines to attract female digitalization, electrification, and IT experts. Through this new recruiting, visionary women who want to change something should see Volkswagen as an attractive employer. Another example is in this slide, I would like to show that the requirements for diversity are different in the various locations of the Volkswagen Group.
The local experts on site know the local needs of the workforce and society and translate these into measures accordingly. Here you can see an example from Chattanooga. Employee resource groups are typically formed with a focus on dimensions of diversity that have traditionally been underrepresented in the workplace. Common dimensions of diversity can extend beyond gender and ethnicity and include sexual orientation, disability status, generation groups, and family conditions. Here you see the priorities of employee resource groups at VW Chattanooga is to improve VW's ability to attract, develop, and retain a diverse workforce; enhance professional growth, mentoring, networking, education; provide VW with perspectives driven by cross-cultural knowledge; and create opportunities to aid VW in driving positive business results. As mentioned in the beginning, we manage our diversity activities around the globe through our global diversity managers.
This diversity management consists of three pillars: community, communication, and our annual diversity conference. Our community of diversity managers is constantly growing. Currently, we have about 60 diversity managers at the Volkswagen Group. By quarterly diversity manager calls with responsible diversity managers, local and monthly community calls worldwide. In September 2021, we had our fifth diversity conference. That is not all. We have to have a closer look on our HR processes. The examples shown so far make it clear that diversity is not just lip service for us, but is implemented with the help of a wide variety of measures. With this final slide, I would like to make it clear once again that it is crucial that diversity and inclusion are anchored in all of the company's HR processes worldwide, from recruitment to development and even to retirement. You have already seen our recruiting campaign.
Sometimes it is the small changes that lead to a big effect. For example, Scania doubled the number of female applicants with one simple change. Scania sales and marketing struggled filling technical positions, so they changed their approach. First, they wrote a customer-centric ad selling the position rather than only listing requirements. Second, two female colleagues developed a brand new ad rather than copy and pasting. The result was remarkable. 30% of the applicants were female, twice Scania's average for similar positions. Through programs such as Diversity Wins and regular worldwide exchanges, we ensure that these best practices are known and can be implemented throughout the Group. Mentoring programs, job sharing in leadership positions, and impact programs are just a few selected examples of how we integrate diversity and inclusion into personal development.
Maybe you will ask yourself why we also care about diversity in retirement process. This is necessary to ensure that valuable knowledge does not leave us with people. We are still at the beginning with the development of an age diversity mentoring program, to be honest. We will start it in the next times. Now let me summarize briefly. Volkswagen Group's Diversity strategy takes a holistic approach, and we have minimum standards worldwide, which we track by means of a diversity index. We are committed to ensuring that our HR processes are fair and free of prejudice. We offer training for managers and employees, and we contribute to remaining an attractive employer for future generations. We live diversity, and together we drive diversity. Thank you for your attention.
Thank you very much, Elke and Anika, for those insights. Looking at the last slide as well is a very powerful statement, and I think we have moved on quite along in the organization from somebody who has worked 20 years here. Very good developments. I would now like to give the operator the signal to open the floor for questions. Just a reminder, Tobias is still here in relation to integrity, and both Elke and Anika are here to take any questions you have relating to our diversity programs. Operator, over to you.
Thank you. If you wish to ask a question, please signal by pressing star one on a telephone keypad. If you are using your speaker's phone, please ensure that your mute function is turned off. Again, press star one for a question. We will now pause for just one moment. Okay. The first question comes from Rebecca White from Newton Investment Management. Please go ahead.
Good afternoon. Thank you very much for the presentation so far. I wanted to ask a question on human capital more broadly. For companies in transition such as yourselves, the management of human capital culture, your ability to attract and retain talent is obviously essential to successfully navigating that transition. Could you perhaps discuss how your integrity and diversity approaches supports the EV transition that you are going through and how you are engaging with employees and labor unions around this EV transition? Thank you.
Okay. I think that's one for Elke. Question is in relation to human capital and how we intend to transfer our employees and integrate them in the transformation process, and how we're going to deal with diversity issues within the transformation.
Yes, I try to give a good answer because I think in transformation processes, it is a very big challenge that we don't lose women or people who are very diverse, because in times of crises or change, there is a risk that the people perform with goals. I try to explain that in crisis, people felt back in old-
Behavioral
behavioral. We have to react. I think diversity and inclusion and the thing of diversity and inclusiveness is a kind of empowerment that they don't do this. There is a big need for awareness training for this. We need some advocate training into newer skills also, both the training to make it aware to act and not to act in unconscious biases, and also a need for trainings to take the people with us and to motivate them to learn new skills.
I would like to add that we believe that diversity and inclusion are enablers for this big change management we are facing. It is about creating an open mindset, and open mindsets help to change oneself, to change and adapt those new skills and being ready, being willingly to be trained into newer skills which the company needs. If I could just add as well, that we have a focus area within our ESG planning on the transformation of our workforce. I think your question also involved the labor relations element. We have committed, as part of the transformation, to use our demographic curve. We have quite an older workforce in comparison, we'll say, to Asian countries, especially within the German factories and plants.
We will responsibly use early retirement programs, et cetera, because we are aware that there is less manpower involved in a much more automized and electrified world. I think Tobias wants to add some information from an integrity point and perspective.
Yes, thank you very much. From an integrity point of view, and the transformation, what it is all about, compliance are rules and regulations, and integrity is on top, doing the right thing. Not everything that is allowed or is proper as per law is something that should be done. With our move to the electrical market, we strongly believe we are on the right way and we have got the right products for the future and to ensure that we are meeting the Paris Agreement. This, we believe in our discussion and dialogue formats when we are strengthening these and we get per annum 15,000 to 20,000 people through our dialogue formats, that we set the power with them free, that we are on the right way, and that it is good to be a part of the transformation for the organization. Integrity as a transformation purpose we see.
Yes, and of course, to make us future-proof. Maybe operator, if we could take the next question waiting.
Yes. Our next question comes from Matthew Slovik from Morgan Stanley. Please go ahead.
Hi. Thank you for your presentation so far, and thank you for taking my question. I would like to ask on the integrity side, as you showed on your slide 11 of the previous presentation, where you have that nice pie chart with all employees, board, management, and the actions everyone is taking. Tobias just said that integrity is doing the right thing, and I wonder how much of cross-unit collaboration there is on this. Most importantly, how much of an opportunity employees have to challenge upper management level when it comes down to dialogues on integrity and doing the right thing. Could you maybe give us some examples, like practical ones, what is being done? Thank you.
Okay. Tobias will take this question.
Okay. Thank you very much. I would like to answer this question in two perspectives. On the one hand, the 11 key initiatives that we are having, are addressing almost every board resource that we have got in our Group. So it is already very much cross-functional where we are changing processes. When you are asking for how much cross-hierarchical exchange do we have, the perception workshops that I just spoke about, where 15,000 people per year, we get through, it is absolutely cross-hierarchical what we are addressing here from top management, from finance, we get people in these discussions, as well as from blue-collar workers from the production line. While asking these questions that we have shown in the discussion about these, we foster the speak-up culture.
We ensure that the same values that we have rolled out with our Group Essentials are applicable for all, whether it is a board member, whether it is a top manager or a blue-collar worker. Since we are doing this not only once but on a regular basis, approximately four to five times per entity or four times per entity over four years, we show the strong commitment that it is important for the board. I hope that answers your question.
Okay. Operator, may we move to the next question, please?
There are no further questions at this time.
Okay. I think then we will call our next speaker who is going to speak to us on the topic of responsible lobbying. I would like to welcome Torsten Briam. Just please have a moment of patience. Due to Corona, we have to just briefly change the people in the room and allow some air circulation. We will be back to you in one or two minutes. We are ready to kick off the next block. Now we have our two speakers in the room, and we would like to kick off with Torsten, who will speak about our lobbying policies.
Yes. Helen, thank you. Thank you very much, and good afternoon to all of you. My name is Torsten Briam, Head of the Department Public Dialogue, State, and Standards at the Group Public Affairs Department. I am really happy to have the opportunity to give you an overview about our regulatory framework for responsible lobbying at the Volkswagen Group. I will give to you just a brief overview about these topics, and I will focus on two aspects. As a first step, I will start with the group activities concerning our regulations and our regulatory framework we have implemented at the Volkswagen Group concerning public affairs processes, followed by a short summary of our information tools concerning all these lobbying things we have already implemented regulations for.
I will give you a short overview about all the relevant information we published about our lobbying activities on the website or elsewhere. Right. Next chart, please. Yes, please let me start with our internal regulatory framework, sorry, difficult word we implemented to organize our public affairs activities at the Volkswagen Group. As you know, Volkswagen Group has a brand structure, and the structure allows its brands to be active in a highly autonomous way. Moreover, the group is represented in several countries by different entities and with different aims. This is also given for the public affairs activities, and we have to organize the public affairs through all these levels for the group. Our department, Group Public Affairs, is therefore coordinating these political issues with group relevance.
This is one main aspect that we take care about these group relevance aspects to ensure these are in a group-wide consistence be handled at all brands, entities worldwide. This is done by an internal regulatory framework, organizing the interaction between our group and the brands and its entities or their entities. This framework is defined by group guideline, which is binding for our brands. The brands have to install or have installed a corresponding regulations binding for their daughter companies as well. This is finally binding for all our employees at Volkswagen. We have this cascade starting with a guideline on a group level, then installed by or taken over by brands and installed by them and therefore, relevant as well for their daughter companies. One of the main issue of the regulation is to install a system of responsible persons for political issues.
Their job is to ensure that the political activities of the daughter companies and the brands are in line with the group positions on political issues. This is installed to ensure a so-called One-Voice Policy we have implemented at the group. For political issues with group relevance, One-Voice Policy is binding for all participants here in the company. With this One-Voice Policy, we ensure that through all levels of the group and the same content is communicated in lobbying processes for topics with group relevance, so that we have all in the same line in the group.
Group Public Affairs is also connected via a so-called dotted line with these political representatives of the brands and the entities, which enables us to directly get into exchange about political topics with group relevance and to ensure that we have a One-Voice Policy proceeded all over the world. With the framework of the guidelines, the representation of the group's political interests towards governments, parliaments, authorities, associations, institutions, and society is coordinated on a worldwide level by our Group Public Affairs Department. To organize this One-Voice Policy and the consistent processes for lobbying, the regulatory framework at Volkswagen also includes a so-called group steering committee for public affairs activities, where the brands and several other group departments are represented in. At this committee, the decisions on political issues with group relevance are defined, discussed, and finally done.
The decision of the committee. My second part now is about our communication and transparency. We also communicate our rules and contents for lobbying outside the public affairs world of Volkswagen. On the next chart, you see that beside this internal regulatory framework, we address several things about our political lobbying to different internal and external stakeholders in different ways. First, we know that employees of the Volkswagen Group could get into a situation where they act on a political floor. To ensure a behavior totally in line with our internal rules for political lobbying, this issue is addressed in the code of conduct. It points out that each employee has to be authorized to act as a lobbyist and has to follow our basic rules for lobbying, so that he is in line with our political guidelines we have to do.
We also address our activities to our stakeholders via the sustainability report. There it is described how we do the representation of the group's political interest towards government, and you also find the regulatory framework in this description explained. There we lay down our fundamental principles of responsible lobbying, and it is combined with an overview of our major issues of political lobbying of the year. There you can find these both major documents of the Volkswagen Group on the websites, and there we address major topics of political lobbying publicly, or being able for the public to follow there. Yes, and this brings us to a third paper we publish. It is called Principles and Guidelines of Public Affairs. On the next chart, you can see them. You can see this document.
This document gives guidance for handling political issues in general guidelines, which outline our self-concept to act as a part of the political world as in political lobbying. These guidelines explicitly lay down how we interpret political lobbying concerning transparency, working in networks, or handling of sponsoring. Of course, they are based on our integrity rules, which we have in charge at the Volkswagen Group. These Principles and Guidelines of Public Affairs defines our approach of responsible lobbying and is in line, for example, with the requirements we receive by the EU Transparency Register, and it is also really close to the code of conduct of the German Transparency Register to become effective next year in 2022.
These documents are also published on our websites and give everybody the opportunity to see how we or how Volkswagen proceeds lobbying. We make major things of lobbying transparent via this public demonstration of these documents. On the next chart, you can see the attachment we also publish with these Principles and Guidelines. We do this in order to make our activities more transparent, and we add in this attachment to these guidelines, where we publish information concerning important aspects of our transparent lobbying. It includes three major aspects. The first is that we include the information on the established event formats Group Public Affairs does normally perform. Due to coronavirus at the moment, this is really limited, but these are the already established events we normally do.
We also publish our support of political party events by sponsoring and the costs of the advertising for party-affiliated publications. We publish the already mentioned positions in dialogue with politics. As I said, we have these linked with the sustainability report where you can find these positions via link to this attachment here. We take those topics of this position paper and it includes the topics where we are involved most in a year, and there we clearly explain which positions we had, respectively, positions we have concerning those topics to make this transparent for the public where we are at these topics positioned. One further important aspect are memberships and associations. We also regularly publish our memberships in this here limited to the political associations as the European Automobile Manufacturers' Association, ACEA, the German VDA or others like BusinessEurope or different others.
This is important for us to make this transparent because lobbying is not only proceeded by ourselves. Several topics are handled by associations. We are member in some associations, and we publish those with these political tasks to make the connection to our lobbying processes. On the next or final chart, I have, it is just about the associations and because they are important, not only for us to get more weight for our own interests, but also for politics, since they cannot talk to numerous companies individually. They need a partner who is able to find solutions for them. This is the major rule of an association, and this is the reason why we are really obliged to be in several associations engaged.
Volkswagen employees being active for Volkswagen and such associations got these guidelines I already demonstrated to you, and these guidelines oblige them as well, how to act in these associations. Basic principles as the One-Voice Policy and the Principles and Guidelines of Public Affairs are in charge for them in their role in the association as well. It is ensured that we have this One-Voice Policy in the associations as well integrated. Of course, membership in an association means to be able to find compromises. It does not work if we only accept our position, but we have a look on if a position is still compatible with ours, and if not, we make this clear not only behind closed doors.
Summarizing my few charts and words, this all is our approach with rules on a company level, with rules for proceeding lobbying, with publishing relevant information about our activities. I think this demonstrates that Volkswagen does advocate for its interests with a really responsible lobbying, and I hope I could give you enough insight for this. Thank you for your attention.
Many thanks, Torsten. I would now like to pass over to Daniel, who is our expert on sustainability management and decarbonization.
Good afternoon, ladies and gentlemen. Happy to be virtually with you and to give a brief update on the most material and pressing topics around sustainability management and decarbonization. You might have witnessed the previous year's conference, so some of the content may sound familiar to you, but there are also many interesting updates which will be highlighted by myself during the next slides. If you could immediately move to the slide number 3. As you can see there, first and foremost, it is important for me to mention that sustainability or ESG is firmly embedded in our group strategy, as it has been already before in the TOGETHER 2025+ strategy. I assume that many of you have listened to the strategy day in July, in which we outlined how we are going as a company from old auto to NEW AUTO.
Today, I would like to point out that ESG, as Helen mentioned at the very beginning of this session, as well as decarbonization, integrity, and many other topics are at the core of a so-called group-based initiative. Within this initiative, a dedicated and comprehensive ESG action plan has been developed in order to improve overall ESG performance in the future. On the next slide, you can see, again, an overview on the topics. As I mentioned, we are oriented towards those four topics of the sustainability narrative, and this chart shows additionally the two topics that are part of the management remuneration scheme. Decarbonization, circular economy, responsibility in supply chain and business, diversity, people and transformation, and integrity are those topics that matter most.
In these areas, it is particularly important for us that we differentiate ourselves positively in terms of performance and at the same time minimize risks. Our ambition is that these topics are efficiently managed, supported by meaningful and robust KPIs where it makes sense. We systematically reflect our performance against the requirements of ESG ratings, legal requirements, et cetera, and based on that, decide on necessary adjustments for our ESG performance management. As you saw, one of the most important topics on the next slide is decarbonization, and the next part of my presentation will focus that very substantial and material issue. As you can see by the quote of Herbert Diess, Volkswagen is committed or has committed itself at a very early stage to an ambitious decarbonization program.
We were completely transparent to what extent the global CO2 budget is affected by the Group's value chain. We also pointed out at the same time that we want to be part of the solution, not just part of the problem. Our vision is that Volkswagen and its products are CO2 neutral by 2050, and we set two interim targets on that pathway. You might have heard already that our CO2 target for 2030 has been recognized by the UN-supported Science Based Targets initiative as in line with the Paris climate goals, so-called well below two degrees pathway. Against this background, we set up a comprehensive and arguably ambitious decarbonization program, which consists of three logical components, as you can see on the left-hand side of that slide. First, reduce energy consumption effectively and sustainably. Second, switch energy supply to renewable sources.
Third, compensate emissions that currently cannot be avoided. We measure this progress with our specifically developed KPI, which we call Decarbonization Index. This is explained in more detail on the following slide. On that slide number 6, you can see some columns that show the composition of the Decarbonization Index and the expected development of the values against the 2030 target. What we expect to see is that the tailpipe emissions in the use phase will be reduced, and we will see a rising importance on the supply chain side. This is mainly driven by the battery, specifically the weight of the battery and the resources needed for that. A quick reminder that only 2% of the complete carbon footprint of a car is associated with the emissions occurring in-house.
For us it is important to walk the talk and to act on those things we can directly influence. To sum it up, portfolio transformation is the key lever in order to decarbonize the company. The next slide gives you an overview on selected decarbonization measures along the whole value chain. On slide number 7, I won't go through every line. You can certainly read faster than I can speak. Just pointing at a few highlights. Our company plans to build six gigafactories covering roughly 240 gigawatt hours per annum in 2030 in Europe. There are already 53 production plants worldwide with 100% renewable power supply in 2020. In terms of use phase, we expect to have roughly 60% electric vehicle sales in the EU in 2030.
The cornerstone of the measures is, again, the portfolio transformation, with currently the ID.3 and the ID.4 as the beacons of that development. Regarding end of life, I will provide a deep dive on the closed loop battery recycling approach in Salzgitter in just a few minutes. On the next slide, you can finally see also quite interesting topic, to close the chapter around decarbonization by pointing at the Green Finance Framework and the Green Finance Report we published this year. As already mentioned, the electrification of our portfolio played also a significant role, and this is the reason why we covered this by the so-called Green Finance Framework. Consequently, after issuing the first green bond in September of last year, our company published the first Green Finance Report in May this year.
As you can see on the right-hand side of the slide, the eligible project portfolio of the Green Finance Framework covers the Modular Electric Drive Toolkit, which was chosen according to the ICMA Green Bond Principles within our Green Finance Framework. The Green Finance Report itself is definitely worth reading. It contains the allocation report and the impact report, and the latter covers interesting insights around the life cycle assessments of the ID.3, including an LCA hotspot analysis. On the next slide, I would like to give you a brief update and deep dive on circular economy, as already promised before. A few words around batteries and components, and it is quite obvious that such an expensive and decisive component such as the battery has to be taken care end of life.
In other words, there is value within and there is literally a second life in it. Our first pilot battery recycling plant opened in January this year with a so-called closed loop approach with two clear benefits which are expected. We will not only reduce the Group's primary demand for raw materials in the long term, but can also significantly reduce the CO2 footprint of the batteries. Calculations showed that we will save more than 1 ton of CO2 per vehicle if we produce our cathodes exclusively from recycled material. How does it work? Volkswagen Group Components first uses a mechanical process. Once the battery enters the recycling process, it is first drained and dismantled, and initial raw materials such as aluminum casing, copper cable, and plastics are already recovered here and returned to the production cycle.
In the following steps, the battery modules are heavily crushed and further processed. At the end of this process, a so-called black powder is produced, which contains, among other things, graphite, lithium, manganese, cobalt, and nickel. In other words, valuable secondary raw material for the construction of cathodes of new batteries. Regarding the position number five on this slide, you may have read the press release a few days ago featuring BattMan. I am not talking about the well-known fantasy figure. I am referring to a new software being developed and used, first in Brussels and later in Salzgitter. This new analysis software, called BattMan ReLife, checks the state of health of battery in just a few minutes and informs the user about basically three options. The first option is then so-called remanufacturing, which means battery as a replacement part for electric vehicles.
Second option, a battery receives its second life, if it has a medium level state of health, for example, for quick charging stations, mobile charging robots, or similar. The third option, as explained before, the efficient recycling at the Volkswagen Group Components pilot plant in Salzgitter. To sum it up, at the end, the whole conception helps us with decarbonization, but also waste management. It also creates a certain amount of employment, when we deal with our recycling, on our cells. On the next slide, a few words on sustainability and supplier relations. In the interest of time, I would keep it short at that stage. As you know from previous conferences, we follow a three-step logic to establishing sustainable supply chains with the focuses on decarbonization, human rights, procurement of raw materials, and combating corruption.
This three-step approach is divided in prevent, detect, react, and you can find all the details on that slide. I won't go through every line. I would rather highlight a highlight of this year, where we published our first responsible raw materials report in May this year. This report provides transparency about human rights due diligence activities performed by the Group. In terms of content, it covers the Group's policy on sustainable raw materials, the Group's raw material due diligence system, and a comprehensive overview on all the activities implemented in 2020 along all relevant raw material categories. This document is definitely worth reading, highly recommended, can be found on our webpage. In the final part of my keynote, if you move to the next slide, number 11, please. I'd like to highlight updates and topics around corporations, engagement, and communication.
At first, I'd like to briefly talk about the Sustainability Council. From my point of view, a real success story, which by the way, celebrates its fifth anniversary this year. As you immediately can see by the pictures, we have a really competent and a powerful set of experts from business, politics, science, and society, who advised and will advise the company on pressing topics of sustainability. It's important to stress that those council members act independently, are not bound by instructions, and have extensive rights of information, consultation, and initiative. The council met and will regularly meet with the Group Board of Management, and they did that without losing any momentum in the past years. In 2020, therefore, the company extended the mandate of the Sustainability Council until 2022.
On the next slide, another impactful format presented there, so-called CEO Alliance for Europe's Recovery, Reform, and Resilience, which was formed in 2020, against the backdrop of the COVID-19 pandemic and the historic European Green Deal. The alliance's shared goal is to make the EU the world's leading region for climate protection, while unlocking investments, fueling innovations in new technologies, and creating future-proof jobs. The members view themselves rather as an action tank than a think tank. The aim is to work together on cross-sector project at scale, cross-EU charging infrastructure, for example, for heavy trucks, the integration of the EU power systems, digital carbon footprint tracking, sustainable and healthy buildings for the future of work and living, and many other projects. Every CEO has taken responsibility for one of those topics, with a team supporting him.
This group of motivated and engaged CEOs turned out to be very effective. This story will also continue. Moving to the next slide, please, on slide number 13. I am happy to highlight another very interesting cooperation that I personally accompanied two times, first back in 2010 and then 10 years later in the Vision 2050 refresh. The World Business Council for Sustainable Development set up again this Vision 2050 project, Time to Transform. What is this vision project about? It basically offers a framework for action in the decade ahead that is practical, grounded in reality, and designed to help companies drive change in their sustainability planning and business strategies. Central to our vision are nine transformation pathways across the key areas. This comprehensive set of documents is also very interesting to read.
Of course, too complex for just an elevator pitch, but I highly recommend to concise this webpage and the documents. I hope you find it as interesting as I did while setting this up. Coming from corporations to communication, on the next slide, number 14, I would like to point at a very interesting new website Helen already mentioned at the beginning, which is around ESG controversies. Why this website? Although we believe that we have made significant progress, as shown in the presentations before, we are nevertheless fully aware that much more needs to be done. We have learned that the area of controversies is a reoccurring concern in terms of communication, and it is not only relevant how we perform, but also how existing media controversies are interpreted and discussed.
With this website, we address all the relevant current and ongoing controversies in a factual manner with the aim of increasing transparency for our stakeholders. The topics can be seen on the slide, which is shown now on the screen, beginning with end of independent compliance monitorship, human rights, and many other issues. This chart covers only a part of the existing topics, and the webpage is regularly updated. So also definitely worth visiting frequently. Finally, all the information on the next slide I presented today and much more can be found in the sustainability report, which contains the separate non-financial report. As a sneak preview, we also plan to optimize this kind of reporting further in terms of capital and financial market requirements.
ESG is our guidance here. In the next report, published in the first quarter 2022, you will definitely see a difference in terms of editorial and other aspects. This brings me to my last slide. I would like to conclude my presentation with maybe the highlight of the year 2021 in the context of ESG. As Helen already mentioned, Volkswagen's reinstatement to the United Nations Global Compact in February is a clear signal of regained trust, five years after the diesel crisis. This reinstatement was only possible through our successful termination of the compliance monitorship and the agreement with the United States authorities. Of course, the strategic decisions, such as the decarbonization program, the electrification roadmap, and of course, the integrity program, as well as many other positive developments. Larry Thompson got it right to the point.
Volkswagen is a better organization today than it was three years ago. With this, I'd like to conclude my presentation. Thank you for listening. Now I'd like to hand over back to Helen and open the floor for a couple of questions.
Okay, we can jump straight into the questions, operator. For both Torsten and for Daniel. Thank you.
Thank you. Once again, if you wish to ask a question, please press star one and please ensure that your mute function is turned off. We now pause for just one moment. Our question comes from Frank Biller from LBBW. Please go ahead.
Yes, hello, thanks for taking my question. Frank Biller from LBBW. It's for Daniel, the question. I've been very interested in the recycling stuff on page nine here, 95% recycling of the batteries. I was wondering, is Volkswagen willing to do all the recycling on their own, or are you cooperating with other OEMs at the moment? Okay, the volumes are very low for the coming back of the batteries because you do not have so much older electric vehicles. But in future, it's a huge increase here. What are the plans for the future? Are you cooperating with other manufacturers, OEMs, or is everybody doing their own stuff?
Thank you for that question. We cannot be completely transparent about every future plan we have in that department. But it is clear that this kind of complex process is also supported by other companies that will take part in several inter stages of the quite complex process I outlined before. As for the current understanding, I cannot comment today on any further cooperations with other OEMs. It is for us clear that this issue is especially also a means for really taking responsibility for the whole value chain and also to secure our employability, which means that we try to cover a significant proportion of this exercise. This is currently the state of play. If you would like to read further information, we have quite comprehensive package of information on our webpage, including some videos.
And maybe just referring to other companies of our group, Audi and Umicore, they also start closed loop for cobalt and nickel. You can find a press release on that, also on the internet. There is quite a lot of development in that. Stay tuned on that, and I hope this answers the question.
Okay. Thanks. Yeah.
Okay. Thank you, Daniel. Now, please, we will take the next question, operator.
The next question comes from Clare Richards from Church of England Pensions Board. Please go ahead.
Lovely. Thank you. I have a two-part question related to lobbying, specifically on climate lobbying. The Climate Action 100+ Benchmark provides a clear blueprint for what investors expect in this area, and the next iteration of that has been published this week, the framework for it. This includes the publication of an assessment of alignment between Volkswagen's business strategy and the activities of the company and its industry associations in relation to climate-aligned, with Paris Agreement-aligned climate lobbying. I did not get a sense from the presentation, though, that there are plans to deliver more in this area. My first question is, could you provide some insight on what it is that prevents Volkswagen from delivering clearly on your integrity commitment by publishing such a climate disclosure?
Secondly, related to that, Torsten mentioned that industry associations are important for Volkswagen to get more weight for your interests. It is kind of interesting to note in that context that two of the associations on which you hold board positions have been aggressively lobbying against policies to promote EVs and to phase out internal combustion engines. Outwardly, both of those appear extremely misaligned with your business interests. My second question is if you could explain whether and how in recent months Volkswagen has been using your influence within those associations to advocate for responsible climate lobbying.
Yes. Okay. Thank you for the question. Maybe let me start with the second one. As I said, Volkswagen has a One-Voice Policy installed for political lobbying, and this One-Voice Policy is also relevant for our activities in associations. Our political positions are strictly in line with our group strategy we have installed. This means in the end that we just follow our strategy with our political positioning also in associations. We do not use associations for lobbying against things which we publicly say we want to join or want to reach. If there is not the same position within an association, we have to do this in a more or less democratic procedure. It has to be done there, and if there is something we cannot cope with, we cannot accept, then we will stop this and/or will not be with this decision of an association.
Normally this means that there's no position on an association if one of the members is against it. We don't use them for doing something against our strategy. Of course, as I said, an association is not our committee. It's not just Volkswagen, so we have to be able to find compromises with the other members. Therefore, we have to find compromises, and it's not just 200% our position. But if this is not compatible with our position, then we won't join this decision of an association. Your first question, I have to ask you if we could do this
Sure
On a different way, because it's not my key issue I'm involved with. If you could answer this later on, this would be fine, because I can't give you a really detailed answer to this question.
Okay. We'll ensure to get back to you, to our stakeholders who are taking part today, with a statement on that. If I could just add in relation to the question on recycling, you might have seen that we published a press release at the end of September, actually addressing the second life battery and recycling issue. So, we have a process now in our Audi Brussels plant. It's called BattMan, which is battery management analysis. It's a clever system that checks the battery within a few minutes, and then, depending on the inspection results, you have different options to deal with your battery. So one option would be using high-voltage batteries to receive a second life, and you could put them into mobile energy or stationary reservoirs. The second would be, if the battery still has enough power, it can go in a different e-vehicle.
A further option would be totally dismantling the exhausted batteries, but of course, using the raw materials and regaining the value from them. So we'll flag that PM to you, and we'll send it on afterwards, since I think we don't have it officially on our website. Thank you. Operator, we can move to the next question, please.
It appears there are no further questions at this time.
Sorry, we've just noticed that we have two further questions on public affairs that have reached us per email. The first question would be: Will Volkswagen join the German Transparency Register?
Of course, it's a law, and German Transparency Register law will get into force on January 1, 2022. At the moment, this law is not really detailed. We have to prepare ourselves. Of course, we will join as we do this already at the, for example, the EU Commission or EU Transparency Register in Brussels.
Okay. A further question that has reached us is if we would consider publishing the VW positions that actually differ from industry association positions on a website in order to advance our transparency level.
As I said or showed to you, we publish our major issues of a year. We were in a lobbying process or political discussions about these topics. We will publish our positions to these major issues, and if there is something dividing from an association position, I think then it would get visible there in our published position papers we have as an attachment of the sustainability report or on our website with our Principles and Guidelines, where we publish this as well. I think if there is a distance between an association and our position, you can find this difference there, because we there clearly point out our position to a political issue.
Okay. Thank you, Torsten Briam. Daniel, for you, we have also just had two further questions that have come per email. The first one is in relation to disclosures around decarbonization and sustainability. In relation to the Task Force on Climate-Related Financial Disclosure, TCFD, it is becoming increasingly important in the capital market and in regulation of non-financial issues. How are we specifically dealing with these new disclosure requirements?
Yeah. Thank you, Helen. That is a great question. So what did we do so far? We started at an early stage to report according to the TCFD requirements in a transparent manner. Specifically, we disclosed a sophisticated TCFD reference table in our sustainability report since the reporting year 2019. This report contains a complete list of deep links and all the existing TCFD requirements. In retrospect, reporting to the Carbon Disclosure Project, also at a very early stage, and we started with that already in 2005. This has proven to be very helpful. This also applies to the Scope 3 greenhouse gas emissions accounting, which we started already roughly 10 years ago. This kind of disclosure exercises paid off at the end to be ready to comply with the TCFD requirements at the end.
Just to add on that, we feel also strongly committed to the TCFD, which may be proven by the fact that we participated in a working group set up by the TCFD Secretariat, which was dealing with the guidance on scenario analysis. The reason why we did that is that in our experience, especially for the colleagues and the experts of the decarbonization program, they said that it is really of utmost importance that managing and reporting of decarbonization pathways and the scenarios around that is really the Achilles' heel in the way of addressing the TCFD requirements. That is the reason why we chose to join this very fruitful working group.
Okay, thanks, Daniel. Now to move to the final question that was posed per email. It relates to our independent Sustainability Council, which we have implemented. Could you elaborate on the current and the future activities and the purpose of our independent council, please?
Yeah. Thank you, Helen, and thanks for the question. As already mentioned in my presentation, in my view, and it is not only my personal view, the work of the Sustainability Council has been really very impactful, fruitful, and in a way, a success story. In spring 2021, the council took stock of the company's sustainability and decarbonization progress. The council members in particular discussed several pressing issues such as human rights and compliance, sustainable supply chain activities, carbon pricing, the CEO Alliance I mentioned before, energy solutions, and many other issues. During the meeting with the Board of Management, the topics ESG, global policy landscape, social responsibility, and purpose were addressed. On our website, you can find a letter to the Board of Management of the Sustainability Council in which they summarize their observations and recommendations. This letter, again, is publicly available.
Above all of that, the council agreed on a new project, which is focusing work and qualification 2030. I will read that. It is called Resources and Strategies for Sustainable Work and Qualification Within and for Innovative Transformative Change. This is also addressing the people and transformation issue. This story continues as mentioned, so the mandate of the council is reaching until 2022. Stay tuned. The council is meeting next week again with the Board of Management, and it turned out to be really good to have an open and problem-oriented discussion around all these issues Sustainability is focusing on.
Thank you very much, to Daniel and to Torsten. We would like now to say thank you and bye for today. We are moving to our final section, so we just need to take a minute or two to carry out some of our COVID checks again. Thank you.
Okay, we are ready to start our final block, and I would like to welcome Antonios now to give our company perspective on human rights. As I said, initially, he is also joined by Daniel, who is our Head on Sustainability Strategy Procurement. Off you go, Antonios.
Okay. Thank you, Helen. Good afternoon, dear ladies and gentlemen. I am Antonios Goros, and within Group Compliance Department, I am responsible for communication on business and human rights. I am happy to have the opportunity to give you a brief overview on our business and human rights activities within the Volkswagen Group. This will cover about 15 to 20 minutes. On the first slide, I would like to begin with some background on our mindset on business and human rights. We have three main reasons why business and human rights is so important to us as a group. The first reason is our historic obligation. As most of you might know, we have a very specific history on this topic as we had forced labor in our Wolfsburg plant during the Second World War. You see here on the left-hand side, a picture from this time.
You see forced workers, mostly women, who build armaments in our factory, and you see them without any protective workwear, even without shoes, for example. What is maybe for you quite important to know, the picture on the right-hand side shows our place of remembrance in our factory because until today, we have a very intensive culture of remembrance and a very good relationship with former forced workers and their descendants. To everyone of the audience who might get the opportunity to visit our factory and to visit the place of remembrance, I do strongly recommend to do so. It is really very interesting and emotional. On the next slide, you see the second reason why human rights is so important to us. On this world map, you see in colored those countries where we have factories.
The colors represent the Maplecroft Index, which is a meta index of around 30 sub-indices. These show the human rights risk within the countries. You do not need to go into very much detail, but what you see at the very first beginning is there are not too many countries which are green. Most of the countries where we have our production plants are red or yellow. This is the second reason why human rights is so important to us, because due to the country risk of our production plants. On the next slide, you see the third and maybe one of the most important reasons, of course, we have legal obligations to respect human rights. Here on this slide, you see the development of human rights legislation around the world from the year 2000 until today.
However, the latest law that we have is the German Due Diligence law, which just this summer passed our parliament. I have also collected some information about this on the next slide. You see, the German Due Diligence law will be binding for us as Volkswagen Group from January 2023. It passed our parliament this summer. Moreover, we are expecting a European legislation also. Normally, the first draft was planned for this summer, but it has been postponed and we expect the draft of the European law for the end of this year. However, regarding the German Due Diligence law, we are in preparation to meet all the requirements from the German law so that our more around 800 entities within the group will have time for necessary implementation so that every entity will be ready when the law comes into force in beginning of 2023.
Moving now, this was the background, the main reasons why business and human rights is important to us. On the next slide, I would give you some overview what we have already done and implemented on the human rights topic. First of all, and Helen did mention this in her intro at the beginning of this conference, I would like to point out that we have a new Social Charter, which is a common declaration of the company. The Board of Management and the Workers Council. It is a declaration on social rights, industrial relations, and on business and human rights. This is really a milestone for our Group. This new Social Charter is our commitment. From company and workforce, the commitment to corporate human rights responsibilities.
It is binding for the entire Group, and it is also a binding basis for our relationship with suppliers and business partners. Within the Social Charter, it is also described that we use our existing and well-established compliance management system for the implementation of business and human rights. I will come to this point a little bit later. Important thing to remember, basis for all our activities is the new Social Charter, which was signed, by the way, end of last year. On the next slide, you see the second basis we have achieved. From main human rights principles and policies, which you see on the left-hand side, such as the Universal Declaration of Human Rights, the ILO, the International Labour Organization, and the ILO Tripartite Declaration concerning multinational industries, the OECD guidelines, the UN Global Compact, and the UN Guiding Principles.
From all these policies, we have extracted those human rights issues which are relevant for us as a Group, for our business, and which are affected by our business. To give you one example, we have selected three main areas and all in all nine salient issues for human rights. To give you an example why there is a selection. There is within human rights, the right for housing. This is one of the basic human rights as well, but this is not on the list of our salient issues because it does not have any linkage to our business activities. The salient issues are really those which are relevant to our business. On the next slide, you see them in a bit more detail, and I will walk through it very briefly. One of the main areas is labor rights.
Here we are traditionally very strong within the Volkswagen Group, and you have topics like good working conditions, no child labor, no forced labor, and the freedom of association. The second main area is the area of tolerance, which means diversity. You heard a presentation about our diversity activities as well today. It is about no discrimination and about tolerance of different viewpoints. Last but not least, we have a third area of important human rights topics, which is security. There it is mostly about safeguarding personal security of our employees. This is also important to know. We have defined the main areas of our activities. Moreover, and you see this on the next slide, we have established organizational and especially committee structures to ensure that business and human rights is covered within our Group.
From group board level on the one hand, down to the regional level within the brands. For example, in the middle, which is the central area at group level, we have KICE. This is our department, and we have the involved group functions. For example, we have KBG, which is within our procurement department. It is group risk management and sustainability, and we have human resources department as one of the major ones. You see within the committee structure, the GSCBHR, the Group Steering Committee Business and Human Rights, where we ensure that all information, all relevant human rights topics are covered from board level to regional level in the brands. By the way, I am personally a managing director of this committee, and it gives me and us the opportunity to spread the topic around the group.
On the next slide I have prepared, we see how far we have integrated business and human rights into policies and processes. We start with number 1, of course, which you might know is we have it into our policies, protecting human rights. It is a code of conduct and the code of conduct for business partners as a basic together with the Social Charter. Second thing, and this is a point that you probably know because you might read it every year. Human rights is a part of sustainability reporting. In our sustainability report, we always give an update about our activities. Number 3, we collaborate, we discuss, and we work together with our stakeholders. For example, we are actively participating in the automotive sector dialogue of the German government. We are an active member of GBI, which is a Global Business Initiative on Human Rights.
We are also in continuous exchange with other and especially with critical stakeholders like NGOs, like the BHRRC, or like for example, the Office of the United Nations High Commissioner for Human Rights. Point number 4, the grievance mechanism. We have an established whistleblower hotline within our group, which is at the same time our grievance mechanism and every person in the world from inside the company, from outside the company, can call this whistleblower hotline. Last but not least, number 5, we have integrated business and human rights into our compliance management system. Here we have some more details on this on the next slide. We have this circle of the CMS, the compliance management system, a little bit bigger so that you have the chance to read it. If you have a look at this from the inner circle to the outer circle.
The inner circle, which is with the gray figures, it is the elements of the Volkswagen Group compliance management system. The outer circle, so the one with the blue figures, those are the elements of the human rights due diligence according to the United Nations, and we see 100% match. Our compliance management system reflects the elements of the human rights due diligence from the United Nations. Which is, for example, it is about culture and values. We have our Social Charter compliance objectives. This is our salient issues. We have, which is number three then, a risk assessment done for our entities. I will give you some more details in a minute. We have compliance programs like the grievance mechanism. We have a compliance organization with committees. Like I have explained, we have communication and trainings in place.
Business and human rights is part of our code of conduct training, and we also have an advanced training for some business areas. We have an ongoing reporting in the context of monitoring and improvement. As a starting point of business and human rights within the compliance management system, I give you on the next slide a brief overview. What have we done? We have done a risk assessment for around about almost 800 group entities. For those almost 800 group entities, we have made a human rights risk assessment, which mainly is a correlation of the country risk based on Maplecroft, like the one I showed you in the beginning. This is the one thing, and the other hand is the business model risk. On the basis of these two elements, every entity has received an individual human rights risk.
On this basis, every entity has received from us a specific measure set for mitigation of these risks, which is being implemented this year. From next year on, we are going to track this, and the entities have to report on this. Maybe to give you one more detail, which I found very interesting and impressive. When we had run the human rights risk assessment for our almost 800 entities, we found out that it is less than 4% of those entities which have a high risk regarding human rights. This is, for me, quite a good message to remember. So far, I have now shown you the most important activities on our topic. I have, moreover, brought one thing on the next slide, you see it, kind of add-on example for our transparent communication and dialogue with our stakeholders.
Early summer this year, we received a letter from the High Commissioner of Human Rights from the UN, asking about, I think, eight or 10 very detailed questions on human rights within the Volkswagen Group. The one thing for us was, of course, to answer this letter in very much detail together with our colleagues from human resources, together with colleagues from procurement department, with Daniel's department, who will join the Q&A session. Moreover, we also got into a discussion round with the team of the High Commissioner on the topic, and we are in continuous exchange with the High Commissioner. This just as an example for our stakeholder activities. On the next slide, and this is really to sum up what you have heard because it was quite a lot of details. I have put together seven points for you to remember.
First of all, we take our responsibility for human rights really very seriously. Second one, we have organizational structures for our business and human rights management within the entire group. We have defined, and this is the third point, specific issues on human rights for us. We have integrated our topic into the compliance management system, and we have run, as I just mentioned, a human rights assessment for almost 800 group entities. Very important for us is the continuous and transparent communication on the topic. Last but not least, we are really actively engaged in discussions such as the German sector dialogue, and other initiatives. I hope this gave an overview on our activities. I say thank you very much, next slide, for your attention, and I hand over to Helen again.
Thank you, Antonios. Operator, we would like to now open the line for the final Q&A session, please. We seem to have some issues with the operator. In the meantime, I can pose some questions that have, again, reached us per email. The first one, Antonios, is in your direction. The new German Supply Chain Due Diligence Act will also apply to Volkswagen from 2023 onwards. To what extent are you already checking whether your processes will meet the legal requirements involved?
Yes, thank you. From the first draft of the law, which was published in early spring this year, we are checking in how far we are prepared for the law. Now we have almost finalized this check, and we are, this day, working on setting up a project team which will ensure that we can meet all requirements from beginning of 2023. We will take care that all our almost 800 entities will be able to meet the requirements.
Another question for you, Antonios, in relation to business human rights. Is Volkswagen's code of conduct binding for all Group companies in the world?
Yes. The code of conduct of the Volkswagen Group is binding for all controlled entities within the world. For all these almost 800 entities that we have assessed.
Okay, that's a big scope. We also have two questions, our last two questions per email. Daniel, I think you would be the correct expert on this. In relation to purchasing, what are the legal obligations for Volkswagen to respect human rights?
Thank you, Helen, and good evening, everybody. First of all, the Volkswagen Group is committed to incorporate human rights responsibility. That's clear. In doing so, we adhere to national laws within the framework of international regulations. As a globally active company, we're bound by the laws of the countries in which we operate. The German Supply Chain Due Diligence Act was already mentioned by Antonios in his presentation and will be of high relevance for us. Additionally, for example, in the U.K., the U.K. Modern Slavery Act requires companies to disclose information about forms of modern slavery and appropriate measures to combat them in their business and value chain. In France, for example, there is a law on human rights due diligence that requires companies to create, publish, and implement an appropriate plan. There are also comparable legal obligations in other countries of the world where we operate.
Additionally, we are also guided by the legally non-binding UN Guiding Principles on Business and Human Rights, which refer particularly to the Universal Declaration of Human Rights and the ILO core labor standards.
The final question we have, I think, again, Daniel, it would be one in your direction. It relates to the origin of raw materials. Do we trace that origin, which are used in our manufacturing processes? If we do, how far do we go down the supply chain? For example, do we go to mine level?
Yeah, that's my topic again. I think, first of all, of course, we take our responsibility as a company in the field of human rights, and especially also in the complex supply chains we operate in, very seriously. Our work with our factories, with our sales companies, but also, and especially with our suppliers, is based on our principles, such as respect for minorities, for employee representation, social and labor standards. This is also one of the binding requirements as a contractual addition with all our suppliers and business partners worldwide. Only suppliers that accept our sustainability requirements and commit to fulfilling them may enter into a business relationship with the Volkswagen Group. We are also checking the compliance with our laws with the, in 2019, established so-called S-Rating, sustainability rating, prior to the final sourcing decision.
That means that before we enter into a contract with the suppliers, we are checking the sustainability performance of the suppliers and then check if they meet our requirements or not. Additionally, we're checking if we get hints or information from external sources via our grievance mechanism. If we identify any irregularities or any violations, for example, for human rights, we take appropriate, quick, and resolute action to ensure that our requirements are met. When it comes to the raw material supply chain, we set up in 2020 a raw materials due diligence management system covering 16 high-risk raw materials. For example, including cobalt, natural rubber, or lithium. Here we continuously identify the risks we see in this supply chain and also take appropriate actions and mitigate the risks.
For the transparency and the question, for example, for the battery supply chain, we embedded additional requirements in a specification document. There we are demanding 100% transparency from the mine to the car. Also for the other 16 raw materials, we are working continuously to increase transparency and identify potential social or environmental risks, and react accordingly.
Okay. Thank you very much, Daniel. To all our participants, we've come to the close of today's conference. We would like to thank you all for listening. We hope it's been valuable, and you're seeing and finding our ESG efforts to improve. I'd like to thank the speakers, and especially I'd like to thank my colleagues, Alex and Ulrich, who make up our ESG team here in Wolfsburg. Finally, I'd like to wish all a happy Friday and a good weekend. Bye-bye.
This concludes today's call. Thank you for your participation. You can now disconnect.