CSR & supply chain management Engaging your suppliers and consumers in your CSR agenda Nicoleta Rusu...
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Transcript of CSR & supply chain management Engaging your suppliers and consumers in your CSR agenda Nicoleta Rusu...
CSR & supply chain managementEngaging your suppliers and consumers in your CSR agenda Nicoleta Rusu30 October 2009
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The headlines
Child workers, some as young as 10, have been found working in a textile factory in
conditions close to slavery to produce clothes that appear destined for Gap Kids,
one of the most successful arms of the high street giant.
A County Tyrone general manufacturing company has been prosecuted for
the unauthorised discharge of trade effluent into a wastewater treatment works
Nike has been accused of using child labour in the production of
its soccer balls in Pakistan.
In recent months it has been revealed how many high street names
including Cafe Rouge, Carluccio's, Zizzi's
and Garfunkel's pay staff below the minimum wage
Proactively managing our supply chain is vital
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Sustainable Supply Chain - a definition
“Management of raw
materials and services from
suppliers to
manufacturer/service provider
to customer and back with
improvement of the social and
environmental impacts
explicitly considered”.
Source: “Business guide to a Supply Chain – A Practical Guide”, Sustainable New Zealand Business Council for Sustainable Development
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Why Sustainable Procurement / supply chain management is important to CSR
Sustainable Procurement is of critical strategic importance for companies and has additional magnitude in today's high-pressure environment
Because most high profile social and environmental risks are traditionally found in the supply chain, responsible supply chain management is a growing area of interest for companies and their stakeholders
A better integration of corporate responsibility issues into companies' sourcing policies and processes is a way to manage more effectively risk that might arise in the supply chain ….
… It might also create new opportunities in terms of savings, innovation, supplier relation management and competitive advantages.
Source CR Index 2007
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A case study - sustainable procurement at KPMG
CSR
Procurement
Diversity
Sustainable Procurement
HR & Professional ServicesFacilitiesMarketingTechnologyTravel
AgeDisabilityGenderRace / ethnicityReligion / beliefSexual orientation
Carbon emissionsCharitable givingCommunityEthical supply-chainProduct compositionReduce / reuse / recycle
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Sustainable Procurement – the business case
Our clients are demanding it
Our competitors are not far behind us
We are advising our clients to implement such programmes
Leveraging the full value and innovation available in the marketplace
Legislation and regulation increasing requirements
Wholly aligned with KPMG’s values
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Programme structure
Supplier audit
Programme components
Supplier Code of Conduct
Supplier selection
Supplier inclusion
Supporting activities
Supplier baselining
Specification
Client reporting
Small business
mentoring
Tier 1 supplier performance monitoring
Supplier development
Reporting
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Specification
Purchasing decisions impact CSR with respect to:
Meeting the needs of a diverse workforce
Minimising environmental impacts
CSR and diversity considerations mapped against different spend areas
Objective: Ensure that CSR and diversity considerations are incorporated in the specification of the goods/services concerned
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Supplier Inclusion
Links directly with the diversity agenda
KPMG Baselining exercise – a questionnaire sent to approx 1000 significant suppliers
Helps us understand:
the diversity of our supply-base
the CSR and diversity performance of our suppliers
Objective: Understand the demographics of our supply base and remove any barriers that prevent SMEs from selling to KPMG
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Supplier Selection
Series of closed, impact-focused questions designed and incorporated within the firm’s standard Request for Information / Proposal
Supplier responses to the evaluation as part of the tendering process
The questions – consistent with those in the Supplier Baselining activity
Objective: Evaluate from the CSR perspective both the specification of the goods / services and the performance of the supplier
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Supplier Code of Conduct
Supplier Code of Conduct set up in 2007
Closely linked to the UN Global Compact
Comprises 10 principles, under the following headings:
Business Conduct
Labor Conditions and Human Rights
Environment
Objective: Require all suppliers to sign-up to our Supplier Code of Conduct as an integral part of their contract with KPMG
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Supplier Development
Process does not end upon selection of suppliers
Supplier Audits conducted
Suppliers may be required to implement remedial actions, if found to be acting contrary to CSR / Code of Conduct principles
KPMG may offer support from own experience (generally during supplier workshop)
Objective: Ensure that Sustainable Procurement forms part of ongoing supplier management and development activity
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Programme structure
Supplier audit
Programme components
Supplier Code of Conduct
Supplier selection
Supplier inclusion
Supporting activities
Supplier baselining
Specification
Client reporting
Small business
mentoring
Tier 1 supplier performance monitoring
Supplier development
Reporting
14
Presenter’s contact details
Nicoleta Rusu
KPMG in Moldova
+373 (22) 201 870
www.kpmg.com
The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation.
© 2009 KPMG Moldova S.R.L., the Moldovan member firm of KPMG International, a Swiss cooperative. All rights reserved. Printed in Moldova.