In response to the irregularities in the public transport tender in Limburg in 2015, the consultancy firm Alvarez & Marsal was commissioned by our shareholder (the Ministry of Finance) and our Supervisory Board to carry out an investigation into the effectiveness of governance, risk and compliance (GRC) within NS. The investigation report concluded: “The GRC organisation within NS is not on a sufficiently sound footing to prevent irregularities and unethical conduct to the maximum extent possible and promote the desired conduct.”
Based on the conclusions and recommendations in the investigation report, NS has drawn up an improvement plan aimed at getting GRC to the desired level and promoting the desired behaviour within the NS organisation. In doing this, NS aims to comply systematically and lastingly, demonstrably and credibly with the standards that are appropriate for a company of NS’s social standing and responsibilities. Concrete goals and actions are specified in the improvement plan. NS has tackled the actions as a matter of urgency and nearly all the measures have now been taken. The implementation of some measures will take several years because they affect the entire organisation or because they are extensive by their very nature. NS reports regularly to the Supervisory Board and the shareholder on the progress in implementing these measures.
In July 2017, NS sent the shareholder a letter giving substantive information on progress in implementing the action plan. This letter stated that the design of GRC within NS has now been brought up to the desired level, which involved the implementation of radical changes in the organisation’s structure. The shareholder informed the Lower House of parliament in writing about this progress in August 2017.
Three lines of defence
In the Executive Board, the Chief Governance, Risk & Compliance Officer is responsible for governance, risk, integrity and compliance. This means that GRC is embedded at the highest level. Within GRC, NS applies the ‘three lines of defence’ principle, as described in the chapter Managing risks.
Integrity & Compliance department
As part of the new structure for the GRC approach, the Integrity & Compliance department was established in 2016. The department plays an important role in encouraging desired behaviour and it seeks to promote correct observance of legislation and regulations within NS, for instance through accessible training courses. Its activities focus on formulating policy on relevant themes such as conflicts of interests, protection of information, fraud, corruption, bribery and competition, providing information about them, handling integrity reports, providing advice both spontaneously and on request, fulfilling the compliance officer role in the business units and in that capacity promoting awareness of integrity as an issue within NS. As of 1 January 2017, the department is a separate entity reporting to the Chief Governance, Risk & Compliance Officer, working closely with other departments including HR, Communications, Risk, Legal, Internal Affairs and Audit. Consultations also take place (subject to the limits set by confidentiality) with the confidential counsellors within NS and the Vangrail network within NS about developments, trends and signs regarding reports and queries about integrity.
Culture and conduct
In 2017, NS started a company-wide programme to encourage a culture of openness, taking responsibility and exemplary conduct throughout the organisation. The conduct of NS’s employees in their day-to-day activities and the choices they make in their work are crucial to the integrity of the company. That is why NS is paying attention to reinforcing a culture of openness and taking responsibility in which dilemmas are discussed, risks weighed up and choices made on the basis of the right information and in which we learn from our mistakes. A culture in which employees are intrinsically motivated to behave ethically, be aware of risks and be compliant. We use of the ‘hearts and minds’ method to ensure that staff make deliberate choices about integrity and conduct, with proper understanding and enthusiasm and from an intrinsic conviction (with their hearts and minds). The aim is to have lasting safeguards for an ethical corporate culture and continuous attention for conduct and integrity within NS. A toolkit with a variety of working methods helps managers and their teams introduce improvements.
The Integrity Portal on the intranet helps raise awareness about integrity within NS and lets staff see what policy is applicable. The portal also gives a picture of the tools and learning aids available for staff and managers when applying the NS policy. The information in the Integrity Portal is constantly being amended and added to in response to the latest developments. Every month, NS publishes a themed bulletin with concise information on a specific topic, such as ‘Communication and conduct’, ‘Conflicts of interest’ and ‘Intimidation’. Employees can also see in the Integrity Portal where to go with any questions, dilemmas or complaints.
NS Code of Conduct
The NS Code of Conduct specifies NS’s four values: proactive, hospitable, cohesive and professional. These values are the foundation for our actions and what passengers can expect from us. The Code of Conduct serves as a guide when weighing up options and making carefully considered choices in diverse and sometimes tricky situations. The Code of Conduct has been published and NS draws the attention of its staff to the Code of Conduct and working ethically in various ways, such as an e-learning tool and a game in which staff can discuss dilemmas in their work with one another or as a team.
Integrity Desk and new scheme for reporting integrity issues
Staff have several options for (anonymously) reporting integrity issues or abuses: by e-mail, by phone, in a one-on-one conversation or via the Integrity Desk on the intranet. Reports are handled by the Integrity & Compliance department. In October 2017, the new NS scheme for reporting integrity issues (including ‘whistle-blower’ reports) came into effect. This scheme replaces the NS procedure for whistle-blowers. The scheme guarantees that employees can report irregularities or suspicions of irregularities, that these reports will be dealt with carefully and confidentially and that the employee will not experience any adverse consequences of having reported the incident. The scheme was highlighted within the organisation in various ways. We also paid attention to the importance of having an open and safe corporate culture in which employees can discuss dilemmas and questions with one another.
A level playing field
Compliance with national and international legislation and regulations is important. NS occupies a special social and economic position in Dutch society. It is therefore essential for NS to prevent any conflicts of interest, or the appearance of a conflict of interest. In our strategy, we stated that NS can achieve this by cooperating with other carriers as a good partner.
In close collaboration with ProRail, we set up a portal in 2016 in which we offer services and facilities in the context of the Railways Act to all carriers in a transparent and non-discriminatory manner. NS has designated single points of contact (SPOCs) for the different business units, where questions from other carriers can be dealt with carefully behind ‘Chinese walls’.