Supply chain management
- Supplier Code of Conduct includes environmental protection as well as compliance with human rights, labor and social standards, antidiscrimination and anticorruption policies
- 155 raw material supplier sites audited on sustainability standards
Our suppliers are an important element of our value chain. Together with our suppliers, we aim to create value and minimize risks.
Stations along the value chain
With our sustainability-oriented supply chain management, we pursue two primary goals: We aim to strengthen our suppliers’ awareness of our standards and expectations, and shape their contribution to sustainable development in a transparent manner.
What we expect from our suppliers
Both new and existing suppliers are selected and evaluated not only on the basis of economic criteria, but also on environmental, social and corporate governance standards. Our Supplier Code of Conduct is based on internationally recognized guidelines, such as the principles of the United Nations’ Global Compact Initiative, the International Labor Organization conventions and Responsible Care. Available in 26 languages, the Code of Conduct covers environmental protection as well as compliance with human rights, labor and social standards, and antidiscrimination and anticorruption policies.
We provided training on sustainability-oriented supplier management to 745 employees in procurement around the world in 2013. This enables them to enter into dialog with our suppliers to raise awareness of, and minimize possible risks along, the supply chain
Evaluating our suppliers
BASF participates in the “Together for Sustainability” (TfS) initiative of leading chemical companies for the global standardization of supplier evaluations and auditing. This initiative aims to develop and implement a global program for the responsible supply of goods and services and to improve suppliers’ environmental and social standards. The evaluation process is simplified for both suppliers and TfS member companies by a globally uniform questionnaire. The initiative’s members initiated a total of around 2,000 sustainability assessments and audits in 2013. Starting in 2014, the activities will be expanded to include further countries and gain new members for the initiative.
In implementing the TfS program, risk matrices help us identify suppliers with a high sustainability risk potential based on country and product risks. Using this risk analysis and other evaluations, we audited a total of 155 raw material supplier sites on sustainability standards and initiated 550 sustainability assessments through an external service provider in 2013. If we discover a need for improvement, we support our suppliers in the development of measures to fulfill our standards. We then check again according to a defined timeframe based on the sustainability risk measured. If we cannot find any improvement, we terminate the business relationship. This occurred in 12 cases in 2013.