Case study: How Semperit promotes sustainability in its supply chain

What are the material issues the company has identified?

In its 2017 Sustainability Report Semperit identified a range of material issues, such as energy use and consumption, occupational health and safety, raw materials and material use, innovation, social standards and working conditions. Among these, promoting sustainability in its supply chain stands out as a key material issue for Semperit.

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 Semperit engages with:

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics Semperit carried out a qualitative survey of 52 stakeholders through structured interviews and, also, performed a quantitative assessment of material topics with questionnaires and a scoring system, by 18 external and 22 internal stakeholders.

What actions were taken by Semperit to promote sustainability in its supply chain?

In its 2017 Sustainability Report Semperit reports that it took the following actions for promoting sustainability in its supply chain:

• Setting sustainability requirements for suppliers
• The requirements set out in the Semperit Code of Conduct and the company’s Supplier Policy serve as a basis for improving sustainability in Semperit’s supply chain. The Supplier Policy outlines the Semperit Group’s expectations of suppliers’ behaviour concerning key environmental, social, compliance and business standards. Suppliers are expected to meet these requirements and are subject to checks, to ensure compliance. These requirements are based on international guidelines such as the Principles of the UN Global Compact, the Charter of the International Chamber of Commerce for Sustainable Development, and the applicable conventions of the International Labour Organisation (ILO). In 2016, Semperit published the Supplier Policy, sending it to all suppliers with a purchase value exceeding EUR 5,000.

• Promoting self-regulation and monitoring
• Semperit uses different instruments and measures to select and assess suppliers, and to ensure compliance with the Supplier Policy. In addition to the disclosure and communication of the requirements, this includes personal talks, self-reporting by suppliers regarding safety, environmental protection, business ethics, labour standards and operational excellence and, if needed, sustainability audits. If the purchase value exceeds EUR 100,000, suppliers have to complete a self-assessment on sustainability and to document the measures they have implemented in specific areas. By the end of 2017, 65% of the suppliers generating revenue exceeding EUR 100,000 of purchase value had completed this self- assessment. This corresponds to 89% coverage of the total turnover with these suppliers.

• Conducting risk analysis
• In 2016, Semperit carried out a country-specific risk analysis on the basis of the index published by the World Bank (Worldwide Governance Indicators) for suppliers of the Sempermed segment. The analysis comprises country-specific risks and makes it possible to focus activities so as to monitor standards more strongly for suppliers with high sustainability risks.

• Dealing with violations of sustainability requirements
• If direct suppliers or sub-contractors do not meet Semperit’s sustainability requirements, they are asked for a written statement presenting the facts and corrective action. If the answers are not satisfactory or Semperit identifies deficiencies and sustainability violations, business partners are subjected to Semperit or third-party audits. Should violations or development potential be identified during these audits, Semperit develops, in cooperation with the supplier, an action plan to improve the situation and supports its implementation. This can be done through an inspection of documents, on-site visits at supplier sites or further qualification measures for suppliers. The implementation has to be carried out within a set time frame and will be checked. In case of severe violations or refusal to address deficiencies, Semperit may terminate the business relationship. Violations of laws and Semperit policies, can also be reported through the Compliance Officer. In addition, to promote sustainability in the supply chain throughout the entire group, Semperit raises awareness among its employees and trains them accordingly. For all procurement employees, the topic “sustainability in the supply chain” is a fixed element of training.

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

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 Semperit, 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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