Case study: How REA Group promotes sustainability across its supply chain
Headquartered in Richmond VIC, Australia, REA Group is a multinational digital advertising business specialising in property. Ensuring the selection, management and payment of suppliers is fair and transparent is a top priority for REA Group, along with promoting local sourcing, supplier diversity and supplier compliance with laws.
This case study is based on the 2020 Sustainability Report by REA Group published on the Global Reporting Initiative Sustainability Disclosure Database that can be found at this link. Through all case studies we aim to demonstrate what CSR/ ESG/ sustainability reporting done responsibly means. Essentially, it means: a) identifying a company’s most important impacts on the environment, economy and society, and b) measuring, managing and changing.
Abstract
REA Group seeks to make sure that its suppliers share its values Tweet This! regarding workers’ rights and human rights, business integrity, health and safety, and a range of other issues. In order to promote sustainability across its supply chain REA Group took action to:
- implement a Supplier Code of Conduct
- ask suppliers to share company values
- apply a due diligence programme
- encourage suppliers to improve their ESG processes
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With this case study you will see:
- Which are the most important impacts (material issues) REA Group has identified;
- How REA Group proceeded with stakeholder engagement, and
- What actions were taken by REA Group to promote sustainability across its supply chain
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What are the material issues the company has identified?
In its 2020 Sustainability Report REA Group identified a range of material issues, such as customer satisfaction, ethics and integrity, diversity and inclusion, data protection and security, human rights. Among these, promoting sustainability across its supply chain stands out as a key material issue for REA Group.
Stakeholder engagement in accordance with the GRI Standards
The Global Reporting Initiative (GRI) defines the Principle of Stakeholder Inclusiveness when identifying material issues (or a company’s most important impacts) as follows:
Stakeholders must be consulted in the process of identifying a company’s most important impacts and their reasonable expectations and interests must be taken into account. This is an important cornerstone for CSR / sustainability reporting done responsibly.
Key stakeholder groups REA Group engages with:
| Stakeholder Group |
| Shareholders |
| Employees |
| Customers |
| Consumers |
| Associations |
| Suppliers |
| Charity partners |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics REA Group engaged with its stakeholders through internal and external issue surveys, interviews and workshops.
What actions were taken by REA Group to promote sustainability across its supply?
In its 2020 Sustainability Report REA Group reports that it took the following actions for promote sustainability across its supply:
- Implementing a Supplier Code of Conduct
- REA Group requires its suppliers to meet its Supplier Code of Conduct. This Code expects suppliers to comply with all laws in relation to workers’ rights and human rights, anti-bribery and anti-corruptions laws and other laws in relation to business integrity, privacy, health and safety, and environmental considerations. Suppliers must also have adequate policies and procedures in place to monitor compliance with these laws.
- Asking suppliers to share company values
- When conducting request for proposals (RFP), REA Group asks suppliers to share their company values, how they support the local community and how employees are celebrated. In addition to helping REA Group choose value-aligned suppliers, this information demonstrates that company values and community investment form a key part of REA Group’s decision-making process, and has the flow-on effect of encouraging more businesses to invest in these areas.
- Applying a due diligence programme
- This programme is triggered for all new suppliers and used by REA Group as a tool to check in on existing suppliers. The assessment covers risk of exposure of highly confidential information, personal information, material financial risk, material reputational risk, risk of infringing third party intellectual property rights, and access to candidate or employee records.
- Encouraging suppliers to improve their ESG processes
- REA Group’s Procurement team has regular check-ins with its suppliers to encourage feedback, continuous improvement, to provide updates on REA Group’s priorities for further alignment and to make sure REA Group’s supply partners are continuing to improve their own ESG (environmental, social and governance) processes. For some strategic key suppliers, a formal supplier governance process is set up in collaboration with the relevant business lead and supplier. They review agreed service level agreements (SLA) and key performance indicators (KPI) deliverables, business continuity impact, relationship health and more. The Procurement team manages a preferred supplier list, which encourages consolidation of suppliers and enhances economies of scale by continuing to support suppliers that have been assessed against REA Group’s governance and sustainability priorities.
Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?
The GRI Standards addressed in this case are:
1) Disclosure 308-1 New suppliers that were screened using environmental criteria
2) Disclosure 414-1 New suppliers that were screened using social criteria
Disclosure 308-1 New suppliers that were screened using environmental criteria does not correspond to any SDG.
Disclosure 414-1 New suppliers that were screened using social criteria corresponds to:
- Sustainable Development Goal (SDG) 5: Gender Equality
- Targets: 5.2
- Sustainable Development Goal (SDG) 8: Decent Work and Economic Growth
- Targets: 8.8
- Sustainable Development Goal (SDG) 16: Peace, Justice and Strong Institutions
- Targets: 16.1
78% of the world’s 250 largest companies report in accordance with the GRI Standards
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References:
1) This case study is based on published information by REA Group, located at the link below. For the sake of readability, we did not use brackets or ellipses. However, we made sure that the extra or missing words did not change the report’s meaning. If you would like to quote these written sources from the original, please revert to the original on the Global Reporting Initiative’s Sustainability Disclosure Database at the link:
http://database.globalreporting.org/
2) https://www.globalreporting.org/standards/gri-standards-download-center/
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