Supply chains have always needed to be flexible and agile
Our supply chain sustainability strategy, which was developed in consultation with internal and external stakeholders, requires each division of our supply chain to minimise its most significant environmental impacts.
The strategy has three underlying aims:
- To take a more long-term approach to managing the sustainability impacts of our supply chain;
- To further develop tools to enable informed decision making; and
- To address the impacts of our supply chain through collaboration with suppliers and other stakeholders.
Manufacturing and logistics use more energy and resources than the rest of our direct operations, so the strategy focuses on them. In both areas, we have measures in place to assess and reduce our environmental impacts and are exploring and adopting alternative technologies and renewable sources.
We use our Sustainable Business Assessment to compare the potential social and environmental impacts and risks associated with new products, components or packaging. Life cycle analysis provides detailed environmental information to incorporate into our decision-making. For example, consideration of energy and CO2 impacts are now used in our global factory sourcing decisions.
Our major supply chain management programme for non-leaf suppliers is our Business Enabler Survey Tool (BEST) which assesses their sustainability performance and provides a framework for continual improvement. Read more about BEST.
Our suppliers are also encouraged to monitor and measure their environmental impacts using a scorecard, that was developed in consultation with strategic materials suppliers. The scorecard covers energy, water, waste and CO2e and helps us monitor performance and identify areas for joint improvements.
External stakeholder panel
In 2011, we established a Supply Chain Sustainability Stakeholder Panel to give us guidance and challenge on our supply chain sustainability issues. The Panel is made up of two suppliers, two professionals from other FMCG companies and two independent experts.
Philosophy for Supplier Partnerships
Our Philosophy for Supplier Partnerships is a Group statement on supply chain management which has been distributed to key global, regional and local supply partners. It builds on our Business Principles and supply chain practices. Among standards we expect of suppliers, the statement makes clear that we will not tolerate any supply partner who has not taken steps to avoid the employment of children (other than in genuine apprenticeships), sales of cigarettes to minors, use of forced or illegal immigrant labour, working conditions that do not meet our own occupational health or safety standards, denial of access to, or unfair application of a transparent grievance procedure or any form of unlawful discrimination, harassment, abuse or bullying.
Our Philosophy for Supplier Partnerships (90 kb)
Sustainability criteria are incorporated into all our framework agreements with global suppliers. We seek out and give preference to businesses and organisations that can demonstrate that they:
- Comply with all applicable laws and regulations where they conduct business;
- Ensure that the highest business ethics are followed and do not engage in corruption or fraudulent activity of any kind;
- Proactively support efforts to combat illicit trade;
- Comply with all international, national and local regulations for environmental performance, safety and occupational health provision;
- Demonstrate that they pay due regard to the impacts of their activities on the environment and work to minimise these impacts;
- Demonstrate assurance that the raw materials they use are from sustainable sources, where applicable;
- Provide regular training for employees on environmental protection and company occupational, health and safety requirements;
- Provide employees with a safe and healthy working environment;
- Do not allow discrimination or harassment in the workplace;
- Provide continuing education, learning and/or development opportunities for employees;
- Demonstrate a commitment to universally recognised human rights and freedoms;
- Do not employ child, prison or bonded labour or use corporal punishment or other forms of mental or physical coercion;
- Demonstrate an interest in and actively contribute to the communities in which they operate.
- We assess potential business partners’ ability to demonstrate their commitment and performance against these principles and request supporting evidence to verify claims where required.
Successfully appointed suppliers or business partners are provided with further support and guidance, enabling improvement against these principles as a business relationship develops.