The Board is committed to supporting the company's efforts to conduct its business in a principled, transparent and accountable manner. The Board believes that its effective oversight of ESG matters is central to its risk oversight function. The Nominating and Governance Committee is responsible for oversight of significant ESG matters, and the Audit and Compensation Committees are delegated responsibility for oversight of specific ESG topics.
Audit: Responsible for Business Ethics, Cybersecurity, Regulatory Compliance and Legal compliance. Also responsible for ESG-related impacts on our financial reporting and ESG-related disclosures.
Compensation: Responsible for Human Capital Management, Talent, Human Rights, Labor Standards, Health and Safety and Inclusion & Diversity. Also responsible for programs and policies related to the foregoing topics.
Nominating and Governance: Responsible for Shareholder Rights, Board Structure, Climate Change Impact, Waste, Water and Energy, Supply Chain Transparency and Product Lifecycle Management. Also responsible for oversight of significant ESG matters not delegated to another Committee.
Management Teams work with senior leaders to set strategy and develop goals to embed sustainability and ESG objectives across our organization.
Board of Directors Demographic Highlights:
Diverse directors in terms of gender, race or ethnicity: 60%
Female directors: 30%
Directors with diversity in terms of race: 40%
Audit, Compensation and Nominating & Governance Committee Independence:100%
70% of Board of Directors with environmental, climate and sustainability experience. Defined by experience or expertise working within or overseeing the sustainability function of an organization, or having educational training on relevant environmental, social, and governance related topics.
70% of Board of Directors with human capital, talent, inclusion and diversity experience. Defined by experience working within or overseeing the human resources function of an organization, addressing compensation, benefits, talent, culture, and inclusion and diversity topics.
Ethics and Compliance
Wesco is firmly committed to operating with the highest levels of ethics and integrity. This commitment is reflected in our global ethics and compliance program, built on four pillars: (i) continuous risk assessments to address ethical and compliance risks, (ii) written standards that set out expected behaviors for employees, managers and other stakeholders, (iii) training and communications to convey expected behaviors, and (iv) monitoring through the use of internal reporting channels, investigations and audits.
Our ethics and compliance program operates under the leadership of the Chief Ethics and Compliance Officer (CCO). The work of the CCO is directly supported by Regional Compliance Officers worldwide. The Executive Compliance Committee provide high-level oversight of the program, comprised of Wesco's chief executive officer, chief financial officer, chief human resources officer, general counsel, and vice president of internal audit and chaired by the CCO. The CCO also provides regular program updates to the Audit Committee of Wesco's Board of Directors during its regular meetings.
The Wesco Code of Business Conduct (the Code) is the foundation of our ethics and compliance program, setting forth standards and guidance for conducting business with the highest degree of honesty and integrity. It defines the basis for decisions and actions across a range of matters, including preventing corrupt business practices, avoiding conflicts of interest, fostering non-harassment and non-discrimination, and protecting personal and corporate data and information. It applies to everyone associated with Wesco - all directors, officers and employees of its subsidiaries- helping us all comply with the laws and ethical principles governing our business. In many cases, the Code requires higher standards of ethical conduct than what is required by law.
We reinforce the principles articulated in the Code to our employees through training and regular communications in local languages. As of 2024, all Wesco employees are annually required to complete Code training and certify that they have read, understand, and agree to comply with the Code. Additional compliance training is also provided to employees based on risks identified in their job roles on topics such as anti-bribery and anti-corruption, conflicts of interest, preventing counterfeit products in our supply chain, and protection of human rights and prevention of modern slavery and human trafficking.
Acting on our principles and speaking up about potential violations of our Code, related company policies and the law is required of all employees. Updated in 2023, Our Business Conduct and Duty to Report Policy describes how employees can report legal or ethical concerns and the measures we take to investigate and address such reports. Our Antiretaliation Policy establishes our promise that those who report issues or concerns will be protected from retaliation.
Wesco provides multiple channels for employees to seek advice and help on ethics and compliance issues. They are encouraged to discuss the issues with a member of management or human resources. Wesco also provides an option for around-the-clock anonymous reporting through the Wesco Business Integrity Line (unless prohibited by local law). Wesco's Business Integrity Line website and web intake form were also upgraded and reintroduced to our employees through a communications campaign launched in 2023.
As we continue to grow and develop our business, we are committed to continuously evaluating and improving our ethics and compliance program. The ethics and compliance office leads an annual review of the Code and related policies to ensure we effectively address and communicate our standards to internal and external stakeholders. Changes are made to the program periodically based on new or updates to existing, applicable laws, emerging and shifting risks and compliance-related trends.
The following list provides an overview of our key ethics and compliance program elements, and additional information can be found in the linked policies and on Wesco.com. Ethics and compliance issues that may be out of the scope of our normal operations that are not covered by a specific policy or program are addressed on an individual basis. When appropriate, we create a new policy, training program, or other proactive measure to address the issue.
Code of Business Conduct: Defines the basis for decisions and actions across a range of matters, including preventing corrupt business practices, avoiding conflicts of interest, fostering non-harassment and non-discrimination, and protecting personal and corporate data and information. It applies to everyone associated with Wesco - all directors, officers and employees of its subsidiaries - helping us all comply with the laws and ethical principles governing our business. In many cases, the Code requires higher standards of ethical conduct than what is required by law.
Global Anti-Bribery and Corruption Policy: Global ethics and compliance policy that articulates Wesco's zero-tolerance approach to corrupt business practices. It establishes a framework to prevent and combat bribery and corruption by promoting integrity, transparency, and ethical business practices within Wesco.
Human Rights Policy: Articulates Wesco's commitment to adhering to business practices aligned with the principles outlined by the United Nations Global Compact, Universal Declaration of Human Rights, UN Declaration on the Rights of Indigenous Peoples (UNDRIP), OECD Guidelines for Multinational Enterprises.
Internal Audit Program: Wesco's internal audit department performs periodic assessments of location branches, distribution centers, and enterprise-level processes and controls to ensure compliance with our policies. In 2023, 84 operational audits were conducted with satisfactory results. Management implemented Internal Audit's recommendations where appropriate.
The internal audit group is also directly involved with the Chief Compliance Officer (CCO) reviewing reported or suspected unethical behavior. It also assists the CCO in conducting special investigations to help enforce the Code of Business Conduct.
Business Conduct and Duty to Report Policy: Our ethics and compliance policy that articulates that all Wesco directors, officers and employees are expected to follow high standards of business and personal ethics while carrying out their job responsibilities. It requires all employees to disclose violations of the Code, related policies, or the misappropriation of Wesco funds or assets. It also provides clear instructions on how to use the numerous channels for reporting issues or concerns.
Anti-Retaliation (Whistleblower) Policy: Policy designed to create a safe and transparent work environment where employees feel comfortable reporting concerns or participating in internal investigations without fear of reprisal.
Anti-Fraud Program: Fraud in any form is not tolerated at Wesco. We fully investigate any suspected acts of fraud, misappropriation, or other similar irregularity regardless of a person's position, title, length of service, or relationship with the company. Anti-fraud guidelines are included in both our Code of Business Conduct and Supplier Code of Conduct. Wesco maintains a robust internal control environment to prevent and detect fraud. Local management serves as the first line of defense in the company against fraud. Senior management, including the corporate controllership, quality assurance, the Vice President, Corporate Ethics and Compliance, and others formulate a second line of defense to prevent and detect fraud. Finally, internal audit, reporting independently to the Audit Committee of the Board of Directors, conducts audits and other reviews of controls and business processes with an obligation to use its expertise to identify trends and patterns that might suggest fraud.
Diverse Business Contracting Compliance: Wesco supports the growth and development of qualified minority, women and disadvantaged business enterprises (MWDBEs). Our Diverse Business Contracting Compliance Policy helps ensure that we are complying with applicable laws and regulations concerning MWDBE participation on government-funded projects. We are committed to the legitimate participation of properly certified MWDBEs that can and will perform a commercially useful function on the public projects in which they participate.
Supplier Code of Conduct: The Supplier Code of Conduct clarifies Wesco's expectations of ethical and responsible corporate business practices for its suppliers. It requires suppliers to conduct their business in compliance with all applicable laws, including those related to employment, protection of human rights, data privacy, health and safety, environmental protection, anticorruption, antitrust and trade sanctions. It also requires suppliers to adopt management systems, policies, procedures, and training to uphold the ethical and legal standards and expectations outlined in it within their business operations.
Business Partner Anticorruption Policy: Wesco policy that applies to all suppliers of products or services to Wesco. It extends Wesco's zero-tolerance for corrupt business practices to its supply chain by strictly prohibiting anyone acting on behalf of Wesco, whether directly or indirectly, from making or receiving improper payments, or engaging in any form of corrupt business practices.
Unless otherwise stated, this report covers activities, data and initiatives from our fiscal year 2023.
ESG Disclosure and Framework Alignment
The topics covered in this report include those that we have determined to be material for our business and stakeholders as noted on page 12. Wesco aligns with several ESG frameworks and disclosures in support of our commitment to transparency and our fulfillment of stakeholder needs and expectations. We leverage the following frameworks and standards to provide robust ESG information disclosure:
Global Reporting Initiative (GRI): GRI offers a list of global standards and guidelines around sustainability reporting.
Sustainability Accounting Standards Board (SASB): SASB provides a comprehensive set of industry-specific disclosure topics and guidelines.
Task Force on Climate-Related Financial Disclosures (TCFD): TCFD provides disclosure recommendations on thematic ESG topics such as governance, strategy, risk management, metrics and targets to provide stakeholders with fuller information surrounding climate risks.
CDP: Formerly the Carbon Disclosure Project, CDP is an international organization that helps companies and cities measure and disclose important environmental impact information through an annual questionnaire and rating system.
United Nations Global Compact (UNGC): UNGC is an initiative that aims to help businesses align their strategies and work toward the U.N.'s Sustainable Development Goals.
United Nations Sustainable Development Goals (U.N. SDGs): U.N. SDGs provide a shared set of 17 toward peace and prosperity for people and planet goals and create a call to action by all countries in a global partnership.
We also regularly engage with our investors, employees, customers, regulators, ratings agencies and others on ESG and business issues. Additional information about Wesco can be found in our public financial filings-including our annual report and proxy filings-as well as on the Security and Exchange Commission's website at www.sec.gov or on the Investors page of our website at Wesco.com.
Wesco plans to continue to report annually as we monitor, measure, and deepen our ESG initiatives and disclosures.
Wesco endorses the United Nations Sustainable Development Goals (SDGs), which are a call to action to end poverty, protect the planet, and ensure that all people enjoy peace and prosperity.
More information about our SDG aligned initiatives is included throughout this report.
Assurance We did not seek third-party assurance for this report; however, we will consider doing so for future reporting. The information and data contained in this report was vetted by internal subject matter experts on the various ESG topics included in this report.
Contact Us We appreciate and welcome feedback on our ESG initiatives and reporting and invite you to contact us directly via email at Sustainability@Wesco.com.
John J. Engel, Chairman, President, and Chief Executive Officer Wesco International
