The case for CSR/ Sustainability Reporting Done Responsibly


IDENTIFY - MEASURE - MANAGE - CHANGE

Insights on how you can protect the environment, maintain and increase the value of your company, through a structured process.

Insights on how you can protect the environment, maintain and increase the value of your company, through a structured process.

Home / case studies / Case study: How Johnson & Johnson promotes environmental and social responsibility throughout its supply chain

Case study: How Johnson & Johnson promotes environmental and social responsibility throughout its supply chain

As the world’s largest and most diversified healthcare company, with 134,000 employees in 60 countries, Johnson & Johnson works with over 70,500 suppliers across its three business segments  Tweet This!: Consumer, Medical Devices and Pharmaceutical. Building a socially and environmentally responsible supply chain is, thus, a key priority.

This case study is based on the 2017 Health for Humanity Report by Johnson & Johnson 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/ 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.

Layout 1

Abstract

For Johnson & Johnson, creating a sustainable supply chain reduces sourcing risks, protects brand reputation and, most importantly, has comprehensive positive impacts on both society and the environment. In order to promote environmental and social responsibility throughout its supply chain Johnson & Johnson took action to:

  • monitor compliance with the Responsibility Standards for Suppliers
  • carry out Environment, Health & Safety (EHS) audits
  • conduct social audits

What are the material issues the company has identified?

In its 2017 Health for Humanity Report Johnson & Johnson identified a range of material issues, such as product quality, safety and reliability, ethics and compliance, innovation, global public health, workplace safety. Among these, promoting environmental and social responsibility throughout its supply chain stands out as a key material issue for Johnson & Johnson.

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 organization should identify its stakeholders, and explain how it has responded to their reasonable expectations.”

Stakeholders must be consulted in the process s 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 Johnson & Johnson engages with:

Stakeholder Group                Method of engagement
Advocacy Groups/Trade

Associations

·         Organizational memberships

·         Direct engagement

·         Dialogue

·         Sponsorships

·         Conferences

·         Research efforts

Consumers

 

 

·         Dedicated 24-hour, 7-days-a-week toll-free hotline in 23 languages

·         Johnson & Johnson website

·         Brand websites

·         Social media

·         Focus groups

·         Clinical trials

Customers ·         Direct contact through sales

·         Customer relationship managers

·         Customer call centers

·         Customer meetings

·         Industry trade groups/meetings

Employees ·         Credo survey

·         Intranets

·         Newsletters

·         Company webcasts

·         Town hall meetings

·         Quarterly business updates

·         Training sessions

·         Anonymous 24-hour, 7-days-a-week toll-free hotline in 23 languages

Government/Policy

Makers

 

·         Governmental affairs liaisons

·         Direct engagement

·         Johnson & Johnson Political Action Committee

·         Meetings

·         Advocacy

Healthcare Providers

 

·         Sales representatives

·         Continuing medical education liaisons

·         Education initiatives

·         Clinical researchers

·         Advisory boards

·         Support and education programs for caregivers

Socially Responsible

Investors (SRIs)

·         Annual report

·         Annual sustainability report

·         Annual shareholders meeting

·         Investor releases

·         Quarterly earnings

·         Road shows

·         Completion of surveys

·         Johnson & Johnson website

·         Conferences

·         Dialogue

·         Direct engagement

Local Communities ·         Direct local engagement

·         Philanthropic efforts

·         Employee volunteers

·         Sponsorships

·         Collaborative partnerships

NGOs

 

·         Direct engagement

·         Dialogue

·         Collaborative partnerships

·         Sponsorships

·         Organizational memberships

·         Conferences

·         Social media

Quasi-Governmental

Organizations/Academic

Institutions

·         Direct engagement

·         Collaborative partnerships

·         Face-to-face meetings

·         Research

·         Academic studies

Suppliers ·         Direct engagement

·         Collaborative partnerships

·         Responsibility Standards for Suppliers

·         Outreach by category leaders

·         Supplier scorecards

·         Face-to-face meetings

·         Trainings and workshops

·         Supplier diversity initiatives

·         Surveys

·         Assessments and audits

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics, Johnson & Johnson invited more than 1,500 stakeholders to respond to a survey. Stakeholders were asked to rank topics by importance to them and by their potential for social, environmental and economic impact.

What actions were taken by Johnson & Johnson to promote environmental and social responsibility throughout its supply chain?

In its 2017 Health for Humanity Report Johnson & Johnson reports that it took the following actions for promoting environmental and social responsibility throughout its supply chain:

  • Monitoring compliance with the Responsibility Standards for Suppliers
  • Johnson & Johnson confirms and monitors suppliers’ compliance with its Responsibility Standards for Suppliers by means of a formal assessment and audit program. Assessments are conducted through EcoVadis – a third-party program. EcoVadis assessments involve an initial screening of supplier performance. Subsequently, the results (a score) play an important role in deciding which suppliers may require an on-site audit.
  • Carrying out Environment, Health & Safety (EHS) audits
  • Johnson & Johnson systematically conducts supplier EHS audits. All EHS site audits are conducted according to the audit protocol and checklist developed by the Pharmaceutical Supply Chain Initiative (PSCI). Johnson & Johnson identifies supplier non-compliances in the areas of environment, health and safety, and management systems. Non-compliance findings are categorised as critical, major and minor and are communicated to each supplier, along with Johnson & Johnson’s expectations that they must implement time-bound corrective actions and show improvement. Johnson & Johnson also supports suppliers in improving their performance, including through:
    • follow-up technical visits which include expert training and best practice sharing
    • business reviews with direct coaching and guidance
    • information provided in the Sustainability Toolkit for Suppliers
    • supplier relationship management engagement at category level
    • participation in supplier capability-building conferences, webinars and other resources that are available through Johnson & Johnson’s membership in the PSCI
  • In 2017, Johnson & Johnson carried out 189 EHS audits and technical visits.
  • Conducting social audits
  • In 2017, to establish an enterprise-wide framework for addressing human rights in its supply chain, Johnson & Johnson expanded the human rights requirements in its updated Responsibility Standards for Suppliers. In addition, a cross-functional Human Rights Working Group met regularly, guiding and informing the development of Johnson & Johnson’s human rights risk assessment approach and audit program. Johnson & Johnson’s supplier social audit program is scheduled to be fully implemented in 2018. Supplier selection and prioritisation criteria will include results for EcoVadis scores regarding Labour and Business Ethics, location in a country considered high risk for violation of human rights and the supplier category.

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: 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.


FBRH GRI Standards Certified and IEMA approved Sustainability Course | Venue: London LSE

By registering for the next 2-day FBRH GRI-Standards Certified and IEMA approved Course you will be taking the first step in gaining the many benefits of sustainability reporting.

 

References:

1) This case study is based on published information by Johnson & Johnson, 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) http://www.fbrh.co.uk/en/global-reporting-initiative-gri-g4-guidelines-download-page

3) https://g4.globalreporting.org/Pages/default.aspx

4) https://www.globalreporting.org/standards/gri-standards-download-center/

Note to Johnson & Johnson: With each case study we send out an email requesting a comment on this case study. If you have not received such an email please contact us.

X