Concha y Toro Norway AS and VCT Norway AS are two fully owned subsidiaries of Chilean Viña Concha y Toro, which is one of the largest wine producers in Latin America and exports to as many as 140 countries.
Concha y Toro Norway and VCT Norway market selected wines from Chile, Argentina and the USA to the Norwegian market. The Norwegian office has a commercial focus with three employees; a Commercial and Marketing Manager, one Brand Manager and one Marketing Coordinator.
The Law
From 1 July 2022 the Norwegian Transparency Act requires that companies, which meet certain criteria regarding i.e. size and turnover, and that sell products and services in Norway must carry out a so-called due diligence on human rights according to the OECD guidelines.
https://www.oecd.org/daf/inv/mne/due-diligence-guidance-for-responsible-business-conduct.htm
The new law obliges companies to carry out a risk assessment of human rights and decent working conditions throughout their full supply chain, their business relationships and their own activities and operations. The due diligence process must include an action -and follow up plan for the risks and non-compliances detected. The requirements also include the ability to communicate this due diligence work externally with consumers.
Local office
Risk assessment and management of the local office and its employees at VCT Norway follows the timeline of the yearly assessment for the supply chain. The risks identified are working hours and decreased occupational wellbeing due to stress related aspects, such as too high workload and lack of supporting functions. To mitigate this VCT Norway is measuring sick leave hours and management has every half year assessments with the employees, in addition to the yearly 360-evaluation of the CyT Holding.
Work with Supply Chain and stakeholders
VCT Norway has worked with its due diligence processes under the umbrella of VCT Nordic’s overall sustainability work, which also includes Norway.
The biggest risks in our business have been identified to be found in the areas of A. cultivation and production of wine and grapes and B. transport and distribution – more specifically distribution within Europe and Norway. This assessment of risk is in line with Vinmonopolet’s and the other Nordic alcohol monopolies’ assessment. https://www.vinmonopolet.no/content/omoss/barekraft/anstendig-arbeid
When it comes to risks in cultivation and production the areas we address more specifically are decent wages, collective bargaining and organisation and decent working hours. Since we are operating in the agricultural sector special risks are associated with seasonal and temporary workers, especially during the periods of pruning and harvest.
When it comes to transport and distribution the risks identified are the working hours and conditions for the truck drivers, especially the ones operating intra-European routes.
As part of being able to be a supplier to Vinmonopolet, VCT Norway’s wine producers has signed the amfori BSCI Code of Conduct since several years back. This code applies to all products, all the way to grower level. https://www.amfori.org/sites/default/files/amfori-2020-03-05-amfori-BSCI-code-ofconduct.pdf
The work with the amfori BSCI Code of Conduct has been in focus of VCT Nordic’s sustainability work for many years. In 2017 one of the most extensive local audits, against the amfori BSCI code – to grower level, ever performed by the Swedish monopoly Systembolaget was carried out at VCT Sweden’s, and hence also VCT Norway’s, two biggest suppliers in Chile and Argentina. VCT Nordic was present during the audit and the risk assessments and areas stated above could be confirmed to be aligned with previous assumptions. The producers received good audit results in 2017 and no severe non compliances were found. The action plans and follow up-reporting was submitted in time and as required. This audit and its result were a good steppingstone for the continuous, structured and proactive work we need to do to in order to improve further and assure good working conditions in our whole supply chain and that we are working in line with the OECD guidelines. We have learned it is not a matter of quick fixes, but rather advocating for a change in the way of working and above all management. And this behavioural work and change takes time and consistent work.
Supply chain mapping
Since 2023, VCT Norway’s due diligence work is based on an annual mapping of the supply chain to grower level for all our monopoly-listed products. Based on the information gathered in this mapping – that concerns the raw material: wine and grapes – a risk assessment and action plan is made for individual suppliers and products. Actions may include obtaining more company specific information and e.g. certificates or to carry out so-called «desktop audits» or alternatively «audits on location». What action is needed depends on the risks identified.
Today VCT Norway has all the listed SKUs (SKU=Stock keeping unit) mapped to grower level in our mapping tool – this means that we know for each of our listed SKUs who the producer is, which cellar has been used and from which growers the grapes are sourced, up to 2/3 of the annual wine volume. We are currently in the process of analysing the results of the additional information; questionnaires, certificates etc that was gathered earlier in 2023.
After analysing the 2023 results VCT Norway’s next step is to broaden our base of producers and above all growers that are fully mapped in our mapping tool. This means having transparency of the producer and growers for each wine up to 2/3 of the full wine volume and in addition to this also complementary information of all mapped entities; such as SAQs according to the amfori BSCI, valid certificates and detailed company information, such as nr of workers, nr of seasonal workers, anonymous complain system in place, unionization etc.
Transport and distribution
The due diligence work and setting requirements for working conditions in the sector of transport and distribution is done together with our contracted 3PL logistics partner. We have regular meetings and follow ups with them and the area of sustainability will be a fixed topic on our regular meeting agenda. Our «Code of Conduct for Suppliers» is part of our contract with them. https://vinacyt.com/content/uploads/2020/09/Code-of-Conduct_-Eng.pdf
As a next step the logistic provider(s) will also be included in the same mapping, assessment and monitoring tool as the wine producers and growers.
Looking ahead
In addition to the already mentioned work, extended focus for the coming years will be put on USA as origin, both from the Nordic alcohol monopolies’ side and also from VCT Nordic’s side. Thanks to the audit in Chile and Argentina in 2017 and the follow up work related to that audit we are confident in our risk assessment and focus of work for these origins. The USA on the other hand has not had the same focus due to a lower preliminary risk assessment from a country and labour legislative perspective but where we now see a need to obtain more first-hand information and a better and more concrete understanding of the working environment for the wine industry workers in USA, and more specifically California and the same risk areas mentioned above. We are looking into the alternatives of performing own audits for our Nordic SKUs and/or so-called desk top audits.
We also always encourage company producer visits to include visits to the farms and growers, not only the winery. This in order to gain more local information and perspective but also to demonstrate and stress the importance of working with human rights and working conditions in the supply chain.
For questions about our products and work with Åpenhetsloven, please contact us at apenhetsloven@vctnorway.oddy.fi