The case for CSR/ Sustainability Reporting Done Responsibly


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Home / case studies / Case study: How ENKA promotes responsible procurement

Case study: How ENKA promotes responsible procurement

ENKA is the largest construction company in Turkey, providing comprehensive services at the design and engineering, procurement, construction, commissioning, operation, maintenance and project management stages of all sorts of construction projects. ENKA believes that in order for its sustainability efforts to be successful, the sustainability approach needs to be spread throughout the value chain  Tweet This! and seeks to make its entire supply chain a part of the progress and development it seeks for itself.

This case study is based on the 2018 Sustainability Report by ENKA 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.

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With its philosophy of continual improvement and creating value together, ENKA assesses all of its suppliers according to their fields of activity, also reviewing supply chain risks and suppliers’ approach to environmental, social and economic sustainability. In order to promote responsible procurement ENKA took action to:

  • conduct a pre-qualification assessment
  • implement a Supplier Code of Conduct
  • monitor and evaluate suppliers’ performance
  • carry out sustainability audits of suppliers

What are the material issues the company has identified?

In its 2018 Sustainability Report ENKA identified a range of material issues, such as economic performance, product and service quality, employee training and development, ethics and compliance, carbon footprint and energy efficiency, community investment programmes. Among these, promoting responsible procurement stands out as a key material issue for ENKA.

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:

“The reporting organization shall identify its stakeholders, and explain how it has responded to their reasonable expectations and interests.”

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 ENKA engages with:

Stakeholder Group                Method of engagement
Employees

 

·      Websites

·      Social media

·      Newsletter – Occupational Health and Safety, Environment, Quality Management Systems, Sustainability Activities, General Announcements

·      Newsletter – Lessons Learned and Best Practices within the Organisation

·      ENKA Academy

·      Employee Loyalty and Satisfaction Survey

·      Ethics and Compliance Audits

·      Ethics Hotline

·      Employee Volunteering Programme

Customers ·      Customer Satisfaction Survey

·      Websites

·      Annual Reports

·      Sustainability Reports, CDP Reports

·      ENKA Document Management System

·      Meetings

·      Ethics Hotline

Business partners

 

 

 

·      Websites

·      ENKA Academy

·      Evaluation Surveys

·      ENKA Code of Business Conduct and ENKA Supplier Code of Conduct

·      Management Systems Audits

·      ENKA Document Management System

·      Meetings

·      Ethics Hotline

·      Audits

·      Sustainability Reports, CDP Reports

Shareholders

 

 

 

·      General Assembly

·      Websites

·      Annual Reports

·      Sustainability Reports, CDP Reports

·      Material Disclosures, Financial Reports, Periodic Disclosures (Public Disclosure Platform – KAP)

·      Meetings

·      Ethics Hotline

Social partners

 

 

·      Websites

·      Media, Social Media

·      Annual Reports

·      Sustainability Reports, CDP Reports

·      Meetings

·      Ethics Hotline

Public institutions

 

 

·      Annual Reports

·      Websites

·      Periodic Disclosures (Public Disclosure Platform – KAP)

·      Sustainability Reports, CDP Reports

·      Meetings

·      Official Correspondences

·      Audits

·      Memberships

·      Career Days, Activities of University Clubs and Societies

·      Conferences and Panels

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics ENKA engaged with a total of 266 stakeholder representatives – including the Sustainability Committee, senior management, ENKA employees, suppliers, non-governmental organisations and professional organisations, subsidiaries, vendors and customers – through face-to-face workshops and online questionnaires.

What actions were taken by ENKA to promote responsible procurement?

In its 2018 Sustainability Report ENKA reports that it took the following actions for promoting responsible procurement:

  • Conducting a pre-qualification assessment
  • Before coming to an agreement with any firm, ENKA’s procurement units run a pre-qualification assessment. Among the criteria for the pre-qualification assessment are the volume of goods and services to be purchased, risk level, supplier assessment results, time and cost analyses, quality assessment analyses, environmental performance, business experience of the supplier, as well as their performance and attitude to ethics, compliance and sustainability. In 2017, sustainability factors were included in the corporate procurement procedure and the supplier pre-qualification and performance evaluation criteria, and began to be used by all procurement units in 2018. These factors include the following:
    • Health, Safety and Environment Management Systems
    • Measurements for water consumption, carbon footprint and waste management
    • Promises to operate ethically and in compliance with human rights
    • Policies and procedures on preventing child labour and forced labour, bribery and corruption, and on preventing discrimination and harassment
    • Legal compliance with workers’ rights and working hours
    • Social responsibility projects
    • Supplier’s evaluation of its subsuppliers on social and environmental compliance criteria
  • Given the business lines ENKA is engaged in, among the most important selection and evaluation criteria are Occupational Health and Safety (OHS) and environmental performance. Suppliers with whom work is carried out or will be carried out as stakeholders have to meet comprehensive and detailed OHS and environmental selection criteria.
  • Implementing a Supplier Code of Conduct
  • ENKA’s Supplier Code of Conduct was published in 2017 in Turkish, English, Russian and Arabic and was communicated to all new and existing suppliers by various means of communication and ENKA’s website. All contracts signed with suppliers include the terms of ENKA’s Supplier Code of Conduct and suppliers and their employees are asked to conduct their activities in line with the Code. According to article 7 of section 3.2 Human Rights and Fair Working Conditions of ENKA’s Supplier Code of Conduct, all suppliers and service providers that work with ENKA have to respect the right of their employees to establish independent trade unions, become members of such unions and to organise at the workplace. During the reporting period, no violations of employees’ right to organise and collective bargaining were encountered at supplier firms and no reports, complaints or tip-offs about such an issue were received. 
  • Monitoring and evaluating suppliers’ performance
  • ENKA runs evaluation systems on electronic platforms to measure its suppliers’ performance, schedule, cost, quality, occupational health and safety, environmental, ethical and social performance. In 2017, additional sustainability subjects such as compliance with ethics, human rights and ENKA’s Supplier Code of Conduct, environmental and social compliance and combating bribery and corruption were added to the list of questions for performance evaluation. The evaluations were carried out electronically, using the ENKA Global Vendor Network (EGVN) database. Before any potential supplier is contracted, the former performance of the supplier is checked on EGVN and no contracts are offered to suppliers whose assessment score is under the acceptable limit, and if any human rights violations or cases of bribery and corruption have been detected. In 2018, ENKA assessed 9.82% of the suppliers it works with in terms of ethics, human rights, combating bribery and corruption, OHS, environmental and social issues. No cases of environmental or social non-compliance were identified at the firms as a result of the evaluation. However, ENKA decided not to work with 14 suppliers, as they did not meet the assessment criteria or performed poorly.
  • Carrying out sustainability audits of suppliers
  • In 2018, ENKA began to carry out sustainability audits of suppliers who are of strategic significance to the company. The audits, carried out by the Corporate Sustainability Department, focused on ethics and compliance, human and workers’ rights, combating bribery and corruption, social compliance, and occupational health, safety and environmental management. The audits are intended to identify issues in need of improvement, leading suppliers to prepare the necessary sustainable improvement action plans and act in accordance with the plans. In the audits that took place during the reporting period, no cases of child labour or forced labour, or cases of corruption, were encountered.

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 408-1 Operations and suppliers at significant risk for incidents of child labor

4) Disclosure 414-1 New suppliers that were screened using social criteria

5) 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 408-1 Operations and suppliers at significant risk for incidents of child labor corresponds to:

  • Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
  • Business theme: Abolition of child labor
  • Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
  • Business theme: Abolition of child labor

Disclosure 414-1 New suppliers that were screened using social criteria corresponds to:

  • Sustainable Development Goal (SDG) 5: Achieve gender equality and empower all women and girls
  • Business theme: Workplace violence and harassment
  • Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
  • Business theme: Labor practices in the supply chain
  • Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
  • Business theme: Workplace violence and harassment 

Disclosure 414-2 Negative social impacts in the supply chain and actions taken corresponds to:

  • Sustainable Development Goal (SDG) 5: Achieve gender equality and empower all women and girls
  • Business theme: Workplace violence and harassment
  • Sustainable Development Goal (SDG) 8: Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all
  • Business theme: Labor practices in the supply chain
  • Sustainable Development Goal (SDG) 16: Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels
  • Business theme: Workplace violence and harassment 

 

80% of the world’s 250 largest companies report in accordance with the GRI Standards

SustainCase was primarily created to demonstrate, through case studies, the importance of dealing with a company’s most important impacts in a structured way, with use of the GRI Standards. To show how today’s best-run companies are achieving economic, social and environmental success – and how you can too.

Research by well-recognised institutions is clearly proving that responsible companies can look to the future with optimism.



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References:

1) This case study is based on published information by ENKA, 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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