Case study: How ASTARTA promotes responsible procurement
ASTARTA is one of the largest vertically integrated agro-industrial holdings in Ukraine, whose main activities include grain and oilseeds production, sugar production from sugar beets, soybean crushing, milk production, as well as grain and oilseeds storage and handling services. In 2020, ASTARTA developed and implemented the corporate standard “Sustainable procurement” Tweet This!, which provides an advanced approach to the management of contractors and suppliers based on sustainable procurement principles.
This case study is based on the 2020 Sustainability Report by ASTARTA, prepared in accordance with the GRI Standards, 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
ASTARTA pays significant attention to the entire processing chain of all the products it produces, extending the principles of sustainable procurement to suppliers. In order to promote responsible procurement ASTARTA took action to:
- launch the Standard on sustainable procurement
- assess suppliers
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With this case study you will see:
- Which are the most important impacts (material issues) ASTARTA has identified;
- How ASTARTA proceeded with stakeholder engagement, and
- What actions were taken by ASTARTA to promote responsible procurement
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What are the material issues the company has identified?
In its 2020 Sustainability Report ASTARTA identified a range of material issues, such as business ethics, occupational safety, human rights, water and effluents. Among these, promoting responsible procurement stands out as a key material issue for ASTARTA.
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 ASTARTA engages with:
| Stakeholder Group | Method of engagement |
| Shareholders/Investors
| · Annual and interim reports · Press releases · Meetings · Presentations · Corporate website · Participation in conferences · Publications in media and social networks · Official correspondence |
| Employees
| · Meetings · Thematic seminars · Corporate events · Corporate publications · Questionnaires · Collective agreements · Corporate ethics code · Training sessions · Consultations · The company’s “hotline” · Social networks · Official correspondence · Enterprise information portal (EIP) · Viber and Telegram channels |
| Creditors
| · Annual and interim reports · Meetings · Presentations · Corporate website · Participation in conferences · Publications in media and social networks · Official correspondence |
| Consumers/Clients
| · Corporate website · Questionnaires · Presentations · Annual and interim reports · Consultations · Negotiations · Interviews · Corporate website · Social networks · The company’s “hotline” · Official correspondence |
| Local Communities /Landowners
| · Conferences · Round tables · Social and charitable programmes · Publications in media · Printed materials (posters, booklets) · Corporate website · Regular meetings with local communities · Viber-channel |
| Suppliers
| · Corporate website · Questionnaires · Presentations · Annual and periodical reports · Consultations · Negotiations · Interviews · Corporate website · Social networks · The company’s “hotline” · Official correspondence |
| Media
| · Annual and periodical reports · Meetings · Presentations · Corporate website · Participation in conferences · Publications in media and social networks · Official correspondence |
| Authorities
| · Consultations and meetings · Seminars · Official correspondence · Joint projects on local infrastructure development · Official correspondence |
| Local farmers
| · Conferences · Round tables · Social and charitable programmes · Publications in media · Printed materials (posters, booklets) · Corporate website · Regular meetings with local farmers |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics ASTARTA engaged with its stakeholders through in-depth interviews.
What actions were taken by ASTARTA to promote responsible procurement?
In its 2020 Sustainability Report ASTARTA reports that it took the following actions for promoting responsible procurement:
- Launching the Standard on sustainable procurement
- In 2020, ASTARTA introduced the Standard on sustainable procurement. This standard determines the ESG (environmental, social and governance) evaluation process of suppliers at all stages. Part of the standard is the sustainable agreement as an addendum to the main contract with the supplier, as well as a sustainability questionnaire, which the supplier is required to fill in. Also, employees are required to give feedback about their experience with the suppliers. This information is collected, analysed and used by the procurement department to form a register of qualified suppliers. According to the Standard on sustainable procurement, ASTARTA conducts permanent monitoring of its suppliers in respect of the following issues:
- Administrative Management
- Human Rights
- Personnel Management
- Environment
- Transparent Business Activities
- User Compatibility
- Compatibility with Local Communities
- Contribution to Cascading of Taxes
- Assessing suppliers
- In 2020, ASTARTA assessed 157 of its suppliers for ecological and social impacts. Among the suppliers who were assessed by ASTARTA, 37 were identified as having potential negative environmental and social impacts.
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 308-2 Negative environmental impacts in the supply chain and actions taken
3) Disclosure 414-1 New suppliers that were screened using social criteria
4) Disclosure 414-2 Negative social impacts in the supply chain and actions taken
Disclosure 308-1 New suppliers that were screened using environmental criteria does not correspond to any SDG.
Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken 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
Disclosure 414-2 Negative social impacts in the supply chain and actions taken 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
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References:
This case study is based on published information by ASTARTA, 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 following link:
https://astartaholding.com/files/uploads/3838c460ac05715b7e6f9573a9855c84.pdf
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