Case study: How SAF-HOLLAND promotes sustainability across its supply chain
SAF-HOLLAND Group is the largest independent listed supplier to the commercial vehicle market in Europe and one of the world’s leading manufacturers and suppliers of chassis-related systems and components primarily for trailers, trucks, buses, and recreational vehicles. For SAF-HOLLAND, compliance with sustainability standards across its entire supply chain is a fundamental element of value added Tweet This! and, at the same time, an important lever in minimising risks.
This case study is based on the 2019 Sustainability Report by SAF-HOLLAND 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
SAF-HOLLAND has a strong network of 4,014 suppliers in 44 countries, whom it expects to align themselves with tis sustainability principles and practices. In order to promote sustainability across its supply chain SAF-HOLLAND took action to:
- conduct supplier reviews
- implement a Code of Conduct
- protect human rights in its supply chain
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With this case study you will see:
- Which are the most important impacts (material issues) SAF-HOLLAND has identified;
- How SAF-HOLLAND proceeded with stakeholder engagement, and
- What actions were taken by SAF-HOLLAND to promote sustainability across its supply chain
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What are the material issues the company has identified?
In its 2019 Sustainability Report SAF-HOLLAND identified a range of material issues, such as product safety and product liability, occupational health and safety, protection of data and intellectual property, environmental efficiency of operational processes. Among these, promoting sustainability across its supply chain stands out as a key material issue for SAF-HOLLAND.
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 SAF-HOLLAND engages with:
| Stakeholder Group | Method of engagement |
| Customers
| · Trade fairs and exhibitions · Customer surveys · Customer visits · Technology days · Customer audits |
| Networks and associations | · Meetings and committees · Attending congresses and events |
| Media
| · Information for the press · Trade fairs and exhibitions · Plant tours · Visits by journalists |
| Employees
| · Employee surveys · Ideas management · Works’ assemblies · Internal media |
| Capital market
| · Conferences · Roadshows · Bilateral dialog · Trade fairs and exhibitions |
| Local stakeholders
| · Facetoface meetings · Plant tours · Neighborhood initiatives |
| Politics and official authorities
| · Cooperation in trade associations · Site visits · Trade fairs and exhibitions · Delegations |
| NGOs | · Roundtable meetings |
| Suppliers
| · Supplier interviews and audits · Industry initiatives · Conferences and symposiums |
How stakeholder engagement was made to identify material issues
To identify and prioritise material topics SAF-HOLLAND conducted a stakeholder survey (a total of 706 stakeholders were involved) along with personal interviews with selected key stakeholders.
What actions were taken by SAF-HOLLAND to promote sustainability across its supply chain?
In its 2019 Sustainability Report SAF-HOLLAND reports that it took the following actions for promoting sustainability across its supply chain:
- Conducting supplier reviews
- As part of the qualification process for new suppliers, SAF-HOLLAND’s new suppliers must pass a review process, which consists primarily of a checklist. SAF-HOLLAND added a number of CSR-related questions to the checklist during 2019 and considered human rights impacts. In all regions, new suppliers are reviewed on the basis of these CSR criteria. This includes environmental issues (CO2 emissions and energy consumption), social issues (occupational health and safety, employee development and a ban on child labour) as well as issues related to compliance and corporate governance. All new suppliers are audited on-site by SAF-HOLLAND’s internal quality department. The CSR-related criteria are integral components of the supplier audits in all the regions SAF-HOLLAND operates.
- Implementing a Code of Conduct
- SAF-HOLLAND expects its business partners and suppliers to align themselves with the principles of its Code of Conduct and act within the law. In the year 2019, 56 suppliers of production materials were audited and no infringements of the principles anchored in SAF-HOLLAND’s Code of Conduct were revealed within the supply chain, also in terms of any negative impact for the environment, the use of forced labour or child labour and the right to freedom of association and collective bargaining. In 2019, SAF-HOLLAND’s CSR Council comprehensively addressed the issue of sustainability in the supply chain and reached a consensus to communicate the revised Code of Conduct to all suppliers.
- Protecting human rights in the supply chain
- In its Human Rights Policy, issued in September 2019, SAF-HOLLAND expects its suppliers and business partners to also comply with its human rights standards. SAF-HOLLAND endeavours to improve the identification of any risks to human rights in its supply chain management. In this context, SAF-HOLLAND started work on restructuring its pool of suppliers. After selecting suppliers of production material, they will then be categorised using a risk-based approach. At this stage, those future suppliers who operate in potentially high-risk countries, supply a high volume of goods or services, products that cannot be substituted or which have a potential for creating shared added value for innovation and sustainability should be identified. SAF-HOLLAND has commenced with identifying risks to human rights based on the location of its suppliers, with the “Global Slavery Index” serving as its point of reference. SAF-HOLLAND will continue to work on improving its processes to identify risks to human rights in its supply chain based on the purchasing category and purchasing market. To this end, SAF-HOLLAND will conduct a gap analysis of its current processes in order to determine any potential for improvement for management and to reduce risks to human rights emanating from SAF-HOLLAND. This includes all forms of modern slavery. In addition, SAF-HOLLAND intends to develop a training module on human rights and modern slavery for the relevant employees in the Purchasing and Quality management departments.
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
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References:
1) This case study is based on published information by SAF-HOLLAND, 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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