5Incentivizing Employees and Productivity

5.1Attractive and responsible employer

As a company operating in a market that continues to grow with digitalization and automation, Cicor offers stable jobs and a healthy working environment. The Group places significant emphasis on creating value for its employees in order to maintain a talented workforce and attract new employees to satisfy its needs as a growing company. In particular, the Group has developed a workforce strategy to counter the shortage of qualified specialists on the labor market that poses a major challenge for the entire industry. This increases Cicor’s competitiveness and resilience, both in the labor market and at site level, and counters knowledge loss by reducing employee turnover.

At the heart of Cicor’s workforce strategy is improving the capabilities and maximizing the potential of its employees. Furthermore, Cicor recruits from diverse backgrounds to ensure a constant flow of new ideas, creativity, and experience, striving to cultivate a competent workforce with the ability to innovate, respond to change and build on opportunities. The workforce strategy is set out in internal documents that stipulate the strengthening of Cicor’s attractiveness as an employer through the implementation of the following concepts in particular: Structured integration programs for new employees, promotion of employees’ individual professional development, freedom of work planning for employees through flexible working hours and the option of remote office work, and attractive and fair salaries.

Fair working conditions

A second crucial pillar, strengthening fair and healthy working conditions at Cicor, has been further promoted by starting to implement a corporate social strategy focusing on equal opportunities, diversity, health, and wellbeing for all employees of Cicor Group. As part of this process, the Cicor Integrity Line was implemented in 2023 to provide every employee and stakeholder of Cicor with the possibility to anonymously inform the Group of misconduct against our Code of Conduct and our ethical standards.

The individual sites operate with strong effort to implement the concepts associated with these strategies. In 2023, the site in Wangs for example has introduced new personnel regulations that offer more vacation days and more flexible working hours. The sites in Bedford, Radeberg, and Dresden initiated annual employee surveys to measure the annual progress of employee satisfaction. At group level, Cicor developed a strategy to strengthen employer branding, the first implementation of which is planned for 2024. This will also entail a data evaluation to measure their effectiveness.

As a consequence of Cicor’s efforts to provide attractive working conditions, the corporate collection of employee data reveals an employee turnover of only around 8% across the sites, a number falling below industry average for manual workers. Simultaneously, Cicor’s workforce has grown compared to 2022 by 19%, with a reasonably even distribution pattern over gender and age groups, and with 60% of employees being covered by collective bargaining agreements. In 2023, 62% of the Group’s employees worked in European countries, 33% on the Asian continent, 4% were located in Africa, and two sales people operate from the U.S.A.. Cicor does neither employ workers with non-guaranteed hours contracts nor control business activities of any workers who are not in an employment relationship with the company.

Additionally, some Cicor sites monitor KPIs such as the number of applications, interview-to-hire ratio, and time-to-hire, and evaluate employees annually on absenteeism. Sites also ask resigning employees to answer a questionnaire that identifies areas for improvement. Cicor works on a system of flat hierarchies, with decision making in recruitment shared by team leaders, department heads, division heads, management, and human resources.

5.2Employee development

Employee development is an underlying priority throughout the Cicor Group. Most locations have aligned training with corporate objectives in order to minimize the risk of losing technological competitiveness. This enables Cicor to keep pace with emerging trends in the field of high-tech development and production. As qualified employees are crucial to the Group’s success, focusing on employee development ensures know-how is maintained and implemented across new projects. Cicor also knows that employee development increases its versatility and its ability to function as a flexible and agile company. The Group further looks to spread specific expertise more widely across the organization to achieve improved resilience to employee fluctuation. This helps Cicor fulfil business requirements and enables employees to get involved in different areas of the company and expand their skills. With this business strategy that focuses strongly on employee development, Cicor not only generates value for itself, but also contributes to a competent workforce in the labor market.

Retaining and broadening knowledge

Cicor is aware that the demands on its employees are increasing and that regular training and broad knowledge in diverse disciplines is necessary. This is most apparent in the fields of medical and aerospace & defence, although it is also relevant in other regulated areas. In particular, staff are retrained each year in the tasks they currently perform to refresh their knowledge and update their skills. The Group also offers training programs for all internal processes. In 2023, at the Wangs and Ulm sites, for example, Workshops on Compliance topics were offered to new and current employees accompanying regular yearly sessions for professional updates. Seeking to generate flexibility, Cicor further trains its staff on different activities by offering a number of cross-functional training courses. In Arad and the Bedford production site for example, employees are trained for various activities and processes outside their actual field of activity. Additionally, the Group financially supports external courses in the cases where new skills will reinforce employees’ capabilities within their roles. The Group also institutionalized the exchange of individual employees among specialist areas in manufacturing, helping to identify talents and promote wide-ranging expertise. Cicor plans to extend this strategy with a group wide learning management system (LMS) in 2024 and 2025.

Promoting future leaders

Cicor further recognizes that employee development is key to motivate its workforce – employees tend to remain with a company that values them and helps them grow. To improve the management of this topic, leadership instruction is provided also to medium and lower management levels. Cicor’s human resources and department managers create yearly employee development plans, taking into account goals identified in annual staff reviews, while also promoting overall employee development across the board. Across the entire company, employees are given equitable opportunities to be considered for training and development based on their abilities and needs, helping them reach their full potential.

Cicor’s continuous business success is testament to the effectiveness of its concepts and measures in place. Nevertheless, the Group’s employee development efforts are evaluated through regular internal and external audits.

Beyond the boundaries of the organization, some departments of the Group provide training courses for students in particular activities related to electronics production and development. Additionally, Cicor subsidizes technical college education and postgraduate degrees when in alignment with the company's current needs.

5.3Occupational health and safety

In most countries, high legal requirements are placed on the protection of employees with regard to health and safety and society's expectations regarding these issues have grown considerably in recent decades. Manufacturing processes at Cicor are highly diverse and most sites pursue operations featuring significant specific health and safety risks. In particular, the Sites in Wangs, Ulm, and Boudry operate processes involving chemicals with high health hazards to the respiratory system. Therefore, active management of the topic is required to prevent damage to Cicor’s employee’s health and avoid the consequences of non-compliance with the respective laws and expectations. IIlness and accident-related absences jeopardize the company’s productivity. Also from a business perspective, the occupational health and safety of the workforce is of the utmost importance to the Cicor Group. This includes the health and safety of Cicor’s employees, as well as visitors. The Group has created a safe working environment and recognizes that caring for the health and safety of its staff not only helps retain its workforce but also offers a more attractive working environment for potential employees.

Cicor’s comprehensive health and safety approach

Cicor’s goal is to have zero working accidents or occupational illnesses. The Group aims to supply every necessary means and resource to ensure the health and safety of collaborators and contributors. Besides adhering to applicable government health and safety laws and regulations, Cicor’s own health and labor safety policy, quality and environment standard operating procedures, health and safety programs as well as production safety officers support the careful occupational health and safety management. On a decentralized level, most sites have a safety committee and a chairman appointed by management to oversee safety aspects. Moreover, at some sites, an additional health and safety task force has been set up. To further encourage employees’ commitment to occupational health and safety and continued engagement around the topic, the workers’ union is part of the health and safety committees. The responsibility for maintaining health and safety across the Group falls on the quality department, maintenance department and HR. However, every collaborator and contributor has a duty to support and advocate for all health and safety measures.

Risks and hazards are identified and controlled throughout operational health and safety documentation, including specific work instructions, training, and clarification of special personal safety equipment to be worn. Health and safety practices of Cicor include preventing exposure to hazardous substances, mandatory checks on air, water, noise and lighting, verification for special equipment such as pressure tanks, lifters, and cranes, as well as fire detection and fighting.

Health and safety training

Cicor believes occupational health and safety can be maintained and improved through communication, training, and awareness. The Group enlists an external safety consultant, organizes staff training, issues protective equipment where necessary, arranges regular occupational health and safety meetings, and provides a medical service for its staff. Employees have the opportunity to receive periodic medical consultations from an external company contracted by Cicor. As required by each site’s individual safety guidelines, all new staff are given a safety orientation, daily safety inspections are conducted, and general awareness is imparted through yearly safety training. The options and accessibility of trainings will be further improved by the implementation of a Group-wide e-learning platform in 2024.The Group also runs monthly health and safety campaigns. Health and Safety incidents are noted in the “dangerous situations and hazards report”, and each record is analyzed and treated as part of a continuous improvement action plan.

Emergency and safety strategies

Emergency management is covered with an emergency response Group. Trained first aiders and/or safety managers, as well as one defibrillator, are in place on each site, and simulations are carried out to ensure emergency preparedness and response.

In Arad, internal health and safety committee meetings are held every six months, which gives employees an opportunity to report dangerous situations and involves them in the implementation and development of the health and safety management system. Employees can also use a suggestion box as needed to report hazardous circumstances. In Batam, an escalation chart is available for reference if an unsafe situation emerges. When an abnormal situation is identified, employees can then feed this information back to the Safety Officer. Furthermore, the Batam site also offers instruction on personal protective equipment (PPE). Cicor's comprehensive health and safety measures have allowed certification of the production sites in Arad, Batam, and Boudry according to ISO 45001.

Effectiveness of Cicor’s health and safety management

Cicor monitors its management of occupational health and safety via internal audits and specific KPIs. Regular KPI assessments include health and safety incidents, occupational illness occurrence, internal health and safety non-conformities, rate of adherence to legal requirements, occupational accidents, hazards spotted, and hazards treated. Zero fatalities were recorded over the last two years. In 2023, work-related injuries remained at a low level (13 per 1000 full-time equivalents). Simultaneously, the incidents appeared to be less severe (58% reduced lost workdays per injury).

Furthermore, the Group tracks the number of complaints and sanctions about occupational health and safety violations and has instigated a monthly inspection report to gauge the effectiveness of Cicor’s initiatives. The Group organizes a bimonthly labor incident monitoring report and works toward continuous improvement of its action plan and safety training matrix. Additionally, a survey is conducted every two years with all Cicor’s employees to evaluate potential to further develop its occupational health and safety concepts.

5.4Diversity, equal opportunity, and inclusion

The Cicor Group strongly upholds the values of diversity, equality of opportunity and inclusion. The Group fosters an inclusive culture that respects people’s differences, promoting a healthy work environment and offering everyone a chance to excel in their given role. This supports the employees’ personal and professional development and contributes to their satisfaction and well-being in the workplace. Cicor has been making continuous efforts to promote a diverse and inclusive workforce and combat discrimination. Thus, the Group does not have to fear negative publicity, which might lead to a failure to attract or retain key talent and ultimately result in financial losses for Cicor.

Fair hiring policy

According to Cicor’s values, employees must be recruited solely on the basis of merit—namely, their skills, experience, and ability to perform the job, regardless of sexual orientation, age, race, gender, religion, marital status, family responsibilities or disability. By hiring fairly and based on merit, Cicor has access to a wide pool of candidates for vacancies. While a policy to foster this fair hiring culture is currently only in place at the Bedford site, concept is being rolled out across the entire Group. Indeed, hiring in 2023 was relatively even between males (54%) and females (46%). Naturally, candidates between 30 and 50 years of age were recruited most frequently (51%) compared to younger (33%) and older (16%) applicants as Cicor depends strongly on technology specialists with a high level of education and experience. Cicor believes that an inclusive workplace centered on good communication causes every employee to feel valued at work.

Cicor employs around 55% women while middle-aged employees make up slightly less than half of the workforce. Cicor’s commitment to a diverse workforce is also reflected in the way the board of directors is composed with 50% male/female members. The diversity of the Board of Directors as well as the Executive Committee is shown in detail in the Corporate Governance Report.

Combatting discrimination

To safeguard its employees, Cicor’s Code of Conduct has been updated in 2022 with new company rules and guidelines that integrate equity, respect, and equality, and condemn any kind of discrimination. In 2023, Cicor implemented a group-wide whistleblower hotline, the Integrity Line. As a result of these continued efforts, there were no incidents of discrimination based on sexual orientation, race, color, gender, religion, political opinion, or the like, in 2022 and 2023. Another indication of fair and respectful work conditions at Cicor is the evenly distributed fluctuation of the Group’s workforce across gender and age groups.

Advancing the social standards at Cicor

The responsibility for equal treatment of all employees lies with Cicor’s top-level management. The Group’s management seeks ideas from staff on how to further improve the working culture and environment and encourages them to raise issues or make suggestions. Cicor has an open-door policy to hear and address staff concerns and open feedback is continually received from employees in the form of emails or verbal communication. Accompanying the Integrity Line, Cicor plans to send out an anonymous questionnaire focusing on social topics to all employees in 2024. The goal is to receive meaningful feedback enabling the further development of the social strategy.