COMPLIANCE WITH LAWS AND REGULATIONS
The nature of Sodexo’s business and its worldwide presence mean that it is subject to a wide variety of laws, including labor law, anti-trust law, anti-corruption law, data protection and privacy, and health, safety and environmental law.
Risk Timeframe: Medium-term 
Category: External Risk
Impact
The wide range of services that Sodexo proposes means that it is subject to very specific laws and regulations for each activity at both the global and local level. As examples:
- as a food operator, Sodexo has a legal requirement to provide accurate allergen information about the food and drinks it serves;
- the emission of vouchers and cards in Benefits & Rewards Services requires compliance with anti-money-laundering laws in some countries;
- working with sensitive populations like children and seniors in Personal & Home Services requires background checks of our employees.
Any non-compliance of Sodexo with laws and regulations or a lack of knowledge and awareness of laws and regulations either at a country level or a global level could mean:
- harm to employees, clients and consumers;
- damage to Sodexo’s reputation;
- potential financial penalties;
- criminal action being brought against the Company and its directors.
Examples of Mitigating Activities
- Legal teams deployed at the central and local levels, who provide advice to operational staff.
- Legal teams specialized by area of expertise, having recourse to external experts.
- Awareness training sessions for our employees.
- Global Ethics and Compliance Committee ensures coordination and coherence of deployment of compliance programs amongst countries.
- Sodexo Speak Up offers Sodexo employees and partners a confidential way to report activities or behaviors that are contrary to the Code of conduct or simply illegal.
6.4.3.2 Emerging Risks
In carrying out its risk assessment, Sodexo also considers risks arising from changes in the external environment. This includes a consideration of emerging risks that are new external risks or existing external risks that have evolved with time, or have been triggered by changed circumstances. They may be perceived to be potentially significant, but might not yet be fully understood, and/or the consequences may be difficult to quantify.
For Sodexo, the change in consumer behaviors arising from the Covid-19 pandemic is an emerging risk. The Covid-19 pandemic has triggered a change in daily working patterns that appears to be becoming permanent in many countries. This means that there are fewer people in the workplace and more consumers working from home for significant periods of the working week, thus reducing the number of consumers for whom we can provide services on-site. The crisis has also accelerated the acceptance of digital technology for food services. During the pandemic, consumers became used to ordering food digitally and getting it delivered , and now expect the same ease and flexibility of choice across all food service providers. To mitigate this risk, Sodexo is evolving its strategy and developing new client and consumer food offers.
We also identify the effects of climate change as an increasingly important emerging risk. Climate change events such as extreme weather or natural resource crises could create food product shortages in certain countries, which could impact Sodexo’s ability to source them. To mitigate this risk, Sodexo uses a broad range of suppliers and continually adapts its menus to take account of availability of products.
For possible adverse effects from Sodexo’s activities on the environment, which are already identified as part of the main risk profile, please refer to 6.4.3.1 Environmental impact risk.
6.4.3.3 Risk coverage
6.4.3.3.1 Insurance coverage
Sodexo’s general policy is to transfer non-retained risks, especially intensity risks, to the insurance market. Insurance programs are contracted with world class insurers.
The main insurance programs are as follows:
- liability insurance, which covers personal injury, property damage or consequential loss caused to third parties. This category notably includes operational, product, after-delivery and professional liability insurance. Since June 1, 2016, Sodexo has implemented a worldwide liability insurance program benefiting all countries in which the Group operates, including the United States and Canada;
- property insurance, which mainly covers the risk of fire and explosion, water damage, natural disasters, and (in some countries) acts of terrorism. As a general rule, the sum insured is equal to the value of the insured property; however, some insurance contracts cap the amount paid out under the policy;
- workers’ compensation. In countries with no government provided coverage (primarily the United States, Canada and Australia), Sodexo has contracted workers’ compensation programs;