The report contains two mandatory disclosures:

• Our work on Diversity and Inclusion in our operations
• Actual status of gender equality

Jotun’s work on D&I

Diversity and Inclusion is included in the company’s strategy for 2020-2023, recognising four action areas: Understanding, Identifying, Attracting and Developing. Jotun A/S follows the Group’s Global Diversity and Inclusion policy. Major activities supporting the above-mentioned focus areas are as follows:

Understanding: The Human Resources Information System supports us in following and understanding diversity measures across the organization. Workshops are held for managers and employees on the topic to increase understanding and awareness. As an example, Diversity and Inclusion is an integral part of the annual “From Strategy to Implementation” training which is mandatory for all managers in Jotun A/S, taking place at the beginning of each year. Through this workshop each manager creates action plans and cascades goals for their team members. In this way we secure that Diversity and Inclusion is addressed on all levels of the organization. 

Identifying: Jotun Group has identified key focus areas to track diversity development on Gender, Age, Nationality and Profession. These areas are reported and followed up twice a year during Business Review. In addition, the Jotun Group works on less quantifiable diversity to ensure that all employees feel appreciated and included in Jotun A/S regardless of their identities. 

Jotun A/S works closely with employee unions, with meetings twice a year. The company also ensures close dialogue during salary review, believing that constructive cooperation with unions and active dialogue contribute to increased diversity and inclusion. 

Attracting: The Jotun Group has a strong recruitment practice which promotes diversity and stands against any type of discrimination. The Human Resources department (HR) is the professional partner that supports all recruitment processes and continuously works on educating managers and raising awareness about advantages of having a diverse workforce, as well as being aware of biases in the recruitment process - that if not identified may lead to discrimination. Jotun A/S also ensures that team composition is considered when recruiting new team members.

In 2022 a leadership booster program was launched, “Inclusive hiring”, which aims at raising awareness and educating managers on how to minimise bias and ensure a diverse recruitment process. All managers have completed the course during 2023.

We know that women seldom choose to work as operators and therefore most of our operators are men. During 2023 we have taken proactive initiatives to attract more women to these roles, by participating in career days and cooperate with relevant educational institutions on informing about the possibilities you have as an operator.

Developing: Diversity and Inclusion is an integral part of most leadership trainings within the company, and diversity among managers is regularly monitored and kept in mind during internal promotions/rotations. In 2023, a management course was held by the Norwegian Labour and Welfare Administration (NAV) for managers in Supply Chain. The course focused on leadership competence, which supports managing employee groups of diverse backgrounds and aimed at enabling managers to recognise the different needs of each employee and adapt leadership approach accordingly.

In November 2023 the global campaign “Speak-up!” was launched in Jotun A/S. The purpose of the campaign is to facilitate and raise awareness of psychological safety for employees to share their views without fear of repercussions. The campaign included several elements such as e-learning, articles, video messaging from top managers and workshops to be run in teams. The campaign also included a reminder and reference to the Whistleblowing channel. The campaign was mandatory for all employees and completion has been tracked and followed up through departmental meetings.

In October 2023 we arranged several initiatives regarding World Mental Health Day. Mental Health in general and the guidelines for good mental health (“Psykevettreglene”) were the topic for both the week and month, and all employees participated in departmental activities on the topic.

During 2023 we have also taken the AKAN (prevention and handling of issues related to alcohol, drugs, gaming and gambling) work and plans to a new and higher level by revitalizing the AKAN-committee and the preventive work. In November, the Working Environment Committee (“Arbeidsmiljøutvalget”) approved the AKAN committee’s new two-year action plan.  

Both the “Speak-up!” campaign, activities on World Mental Health Day and the revitalised AKAN concept will affect our culture, the feeling of psychological safety and also prevent harassment in general, hereunder sexual harassment.

Jotun A/S are continuously working to identify areas where we can contribute to anti-discrimination. For example, how to in the best way take in disabled persons for job training or language training.

Risk assessment
Jotun A/S’s salary policy supports an annual evaluation process that helps us discover discrepancies against the principle of right, fair and competitive pay. Jotun A/S has a formalised Job Structure and works to ensure gender pay equality. The recruitment policy, which is transparent and standardised, allows Jotun to map the risks and through cooperation ensure that our values are followed. The company’s Whistleblowing channel ensures that employees have a safe and easily accessible way to raise their voice if unfair practices are observed.

Results and moving onwards
Jotun works with a continuous improvement approach, and we observe that the female proportion in the company is increasing, as well as the number of nationalities. During 2023 we have recruited employees with widely different backgrounds. Diversity is followed up through Business Reviews, management trainings, standardised internal and external recruitment processes and other.

The global Jotun Diversity and Inclusion policy was launched in January 2020 and calls for action in each unit, including Jotun A/S. The global “Penguin Care” programme was implemented in September 2022, focusing on contributing to employees’ health, well-being and work-life balance. It establishes a global minimum for parental leaves for both men and women, as well as welfare leaves for taking care of children, spouses and parents, when needed.

In January 2022, Jotun launched a Diversity and Inclusion Index where all employees were invited to give their feedback on the company’s work on Diversity and Inclusion. The result showed that 85 per cent of the employees experienced their manager and Jotun A/S to foster an inclusive culture.  Nine per cent answered neutrally, while six per cent felt less included. This is a solid high index rating that Jotun is very proud of. At the same time, we have continued working on the areas where our employees have told us we can improve (see below), and we will continue to do so in 2024 on the way to the next Employee Engagement Survey which is scheduled for 2025 across the region. 

Results of Diversity and Inclusion Index
The below table presents the questions asked as part of the Index and result distribution. Jotun notes that while overall results are very good, there are certain areas to improve, such as ensuring that advancement opportunities are available to employees regardless of personal background or characteristics. This is done by continuously coaching managers in inclusive recruitment and performance management, as well as enhanced and transparent feedback to the organisation on competence-based criteria for recruitment and promotions. 

Actual status of gender equality

Below we provide an overview of Diversity and Inclusion related statistics for Jotun A/S.

Gender distribution Jotun A/S
Among the 958 permanent employees at the end of 2023, there were 299 (31 per cent) women and 659 men (69 per cent). (2022: 32 per cent women)

Gender distribution – managers
Among these employees there were 217 managers. 75 of those (35  per cent) were women. (2022: 33.5 per cent women)

Gender distribution – top management
From January 1^st 2024 there are 8 direct subordinates to the President and CEO. 3 of them (37,5 per cent) are women. (2022: 4 women out of 9 direct subordinates, 44 per cent)

Part-time employees
At the end of 2023 there were 29 permanent employees (3 per cent) not working in full-time positions. 14 of those (48 per cent of total) were women. It is important to note that part-time positions are not part of Jotun A/S recruitment policy – all employees working less than full time have chosen to do so voluntarily, most common reasons being work/life balance, approaching retirement age and other personal circumstances.

Temporary employment
At Jotun we strive to employ in permanent positions, however, certain reasons may call for temporary employments. Some of the most common reasons are:

• temporary recruitments to cover for maternity/paternity leave absence
• temporary recruitments to cover for long-term illness absence
• temporary project work.

Short assignments opportunities are given to younger students, and there are approximately 30 apprentices hired at any given time, most of which have 2-year contracts. At the end of 2023 there were in total 13 temporary employees with agreements of length between 6 and 18 months (in addition to apprentices). 6 of those were women and 7 were men.

Services of a third-party recruitment agency may also be used, in case of temporary need for resources. There is regular communication with Union representatives regarding the need for external temporary workers. The company aims to prioritise the temporary workers when opportunities for permanent employment arise that match the qualifications.

Parental leave 
In 2023 a total of 55 employees at Jotun A/S were on parental leave (22 women and 33 men). Among women, the average number of absence days due to parental leave in 2023 was 78, while 48 among men. These numbers are for the calendar year 2023 only, and thus omit possible absence days for the same employees in 2022 or further on in 2024. Note that this includes both parental leave and the additional two weeks of leave that co-parent is eligible to take off in connection with birth. These two weeks at Jotun are paid leave.

Nationalities
By the end of 2023 there were 958 permanent employees in Jotun A/S. These employees represent 43 different nationalities. Nationality is how we have chosen to measure diversified ethnic identity. Among the majority with Norwegian nationality, there are also individuals with diversified cultural background. Jotun is proud of our culturally diverse workforce and believes this to be a competitive advantage and a crucial trait for the headquarters of a global company.

Age
Average age at Jotun A/S by end of 2023 was 47. Among managers the average age by end of 2023 was 49, while for the rest of employees, the average age was 47.

During October 2023 all senior employees (aged 60 or above) were invited to a Senior day, where they were provided both with inspiration and information on the importance of a senior workforce for both the company and society at large. The significance and relevance of their competence and experience and its impact on the company’s success was discussed. Feedback after the meeting was very positive and it has been decided to establish “Senior day” as an annual event in the company, to contribute to inclusion of the senior workforce.

In December “Family Day” was launched which invited all employees with their families to visit Headquarters for a Christmas spirited event. This is a first event involving members of the employees’ families, which mainly aims at the group of employees with children and increases inclusion among this group through allowing them to share their workplace with their close ones.

Equal Pay (Section updated February 2024)
Jotun A/S uses Korn Ferry’s Market Salary Data to ensure compensation governance and do statistical analysis across paygrades, gender, age, seniority etc. If unjust discrepancies are discovered, a plan is put in place for extraordinary increase to decrease the gap. No major gaps linked to gender have been reported during the previous salary reviews. In 2021 a new HR management system was launched which also included a review of the existing pay level distribution in the organization. During salary reviews, HR together with Unions analyze salary data to detect whether there are any practices that imply inequality between genders or age groups. Where inexplicable gaps are discovered, these are corrected during salary review.

The following section presents analysis of salary level within Jotun per December 2023, as well as some comments.

Operators
Almost 20 per cent of Jotun A/S employees are operators. Salaries of these are not individual, but based on local tariff agreement which is reviewed on annual basis.  As per December 2023 there were 158 operators, among these 14 females (8,9 per cent). Operator salary consists of the following components: Basis salary (“grunnlønn”), Addition for approved certificate (“fagtillegg”), Addition for competence level (“kompetansetrinnstillegg”) depending on which tasks one is certified in, as well as Addition for team leaders (“teamledertillegg”) for those who take on extra responsibility. In addition, there is monthly payment for working shift (two-shift or three-shift).

As of December 2023, the female salary level among operators was 98 per cent of the male salary level. The nuances are then based on the combination of the salary components as described above.

Apprentices
Jotun has an apprenticeship programme, which includes 20–30 apprentices. Salaries of these are not individual but based on local tariff agreement which is reviewed on an annual basis. Below you will find the table of payment for apprentices depending on in which phase of apprenticeship they are. As of December 2023 we have 32 apprentices with active agreements at different stages of apprenticeship. 5 of these are women and 27 men. Jotun has focus on Employer Branding activities to promote apprenticeship in company at earlier stages, such as by visiting Secondary schools and works towards raising awareness that apprenticeship in operations is not only for males. Our focus is on raising the female proportion among apprentices, given the pool of candidates that is available.

Temporary employment
In addition to apprentices, there are some employees that are hired temporary to cover for a temporary need; this may be covering for parental leave or participating in project work, covering for holidays and so on. Per December 2023 we had 13 employees with temporary contracts with Jotun. The profiles vary from students taking on seasonal job during school holidays to retired employees that return to company for a period of time to support with their competence. Snapshot of this varied group shows that the female/male hourly salary ratio during December was 87%. This reflects the different positions, competence and age groups among the 13 and not the gender.

Permanent employees with individual salary
For analysis, we are looking at permanent employees at Jotun A/S with individual salaries. The table below shows comparison of male/female salaries, based on monthly salary. Furthermore, we exclude the levels that host less than five employees of each gender.

Comments
The table above shows salary comparison between females and males within each grade. This proportion varies from 91 per cent to 103 per cent, with total averaging on 96,3 per cent for the gathered group above. The data is based on average monthly salary against position level and disregards other factors of influence, such as age, seniority, education level, previous positions held, etc.

The 2024 analysis, as with every salary review, will be performed across the organization to ensure no unjust practices are in place, keeping in mind that salaries for administration are individual. If and where unjustified discrepancies are observed, HR in cooperation with the unions and managers work towards diminishing differences.

Overtime
Overtime in Jotun can mainly be observed in the factory. Among the 158 operators in 2023, there were 94 that worked overtime during 2023, averaging 18 hours per employee during the full year 2023. Among these 94, there were 11 females with average number of overtime hours 14.

Among employees in administrative positions, there is little use of overtime and high level of flexibility to do tasks at the time, place and pace one prefers. 198 employees have worked overtime during 2023: 32 women (average 25 hours) and 166 men (average 31 hours). The difference can be explained through various factors, main of them being that roles that are more technical and require periodically overtime, are still mainly covered by males.

Cash benefits, including bonus and gratuity
At Jotun there are several cash benefits that employees may be entitled to depending on the job they hold. This includes, for example, car allowance, if the position requires a car, office allowance for sales representatives, duty allowance for mechanics, allowance for those participating in industry protection and so on.

At Jotun we operate with bonus agreements for certain high-level positions and distribution of profit (gratuity) among the rest of employees. Gratuity is decided by the Board every beginning of the year. While bonus agreements are connected to individual reach of goals, gratuity is based on the segment results during the previous year and paid out in days to all employees. Announcements on number of days depending on organisational structure are communicated during the first two months of the year.

Among operators, the amount of paid out cash benefits for women vs men in 2023 was on average 68 per cent. Among administration workers, the amount of paid out cash benefits for women vs men in 2023 was on average 52 per cent. Here we see a strong correlation to specific job categories (for example, sales) that are male dominated, which in return proportionally increase their amount of cash benefits.

Payments in kind
At Jotun we have several payments in kind, for example, free car for certain positions, as well as free mobile phone and internet depending on the position and its needs. Among administration workers the amount of payout of benefits in kind for women vs men in 2023 was 45 per cent. If we look at one month separately (December 2023), this proportion is 49 per cent. The main difference here lies in access to free cars for sales executives. This function is still quite male dominated.