Case study: How the Prysmian Group promotes sustainability across its supply chain

What are the material issues the company has identified? 

In its 2019 Sustainability Report the Prysmian Group identified a range of material issues, such as attracting talent and developing human capital, solutions for sustainable applications, energy efficiency and combating climate change, cyber security and data protection, occupational health and safety, waste management and recycling. Among these, promoting sustainability across its supply chain stands out as a key material issue for the Prysmian Group.

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 the Prysmian Group engages with:

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics the Prysmian Group engaged with its stakeholders through a multi-stakeholder event which involved stakeholders from all over Europe, attended by approximately 70 stakeholders, and also conducted a survey of key external stakeholders (customers, suppliers, universities and research centres, investors and trade unions), to reach a larger number and obtain additional feedback.

What actions were taken by the Prysmian Group to promote sustainability across its supply chain?

In its 2019 Sustainability Report the Prysmian Group reports that it took the following actions for promoting sustainability across its supply chain:

• Implementing a Code of Business Conduct
• With a view to ensuring that ethical, economic, environmental and social standards are met throughout the value chain, in 2014 the Prysmian Group decided to promote a responsible and sustainable chain of supply by adopting a Code of Business Conduct. This Code took effect in 2015 and applies to all employees and business relations. The principles set down in the Code apply to the business transactions and daily activities of the employees of all Group entities and their suppliers, commercial partners, commercial agents, sub-contractors and distributors. The document covers the following topics:
  • business integrity (fair trade, conflicts of interest, gifts and offers of entertainment, corruption, accountability);
  • human rights and workers’ rights (under-age working and slavery, occupational health and safety, non-discrimination, freedom of association and collective bargaining);
  • environment (principle of precaution, use of raw materials and compliance, energy consumption, greenhouse gases and other emissions, use of water, production of waste and recycling).
• Prysmian’s application of the related guidelines is highlighted to suppliers at the scouting and qualification stages. In addition, the Group’s Human Rights Policy was extended by adding a specific chapter on the monitoring and identification of potential breaches in the supply chain, with remedial action and, if necessary, the exclusion from all commercial and business relations of suppliers that do not respond promptly to the standards required.

• Applying a Conflict Minerals Policy
• From 2017, the Prysmian Group applies a Conflict Minerals Policy, with the aim of guaranteeing its customers a “Conflict Minerals free” supply chain through the following activities:
  • identification of purchased materials/semi-finished products containing 3TG (tin, tungsten, tantalum and gold from the Democratic Republic of Congo or neighbouring countries);
  • request to all regular suppliers regarding the sourcing of minerals used in their production processes (through formats and international standards);
  • analysis of information received and implementation of corrective actions.

• Auditing suppliers
• In order to monitor the sustainability of its supply chain and reduce possible negative impacts, the Prysmian Group also analyses, on a centralised and integrated basis, all risks and opportunities associated with its supply chain, focusing on the risks deemed most critical by the Group. During 2019, the Prysmian Group finalised an internal Supply Chain Strategy document that governs the entire supply chain of the materials needed. The process involved envisages:
  • A risk analysis by supplier for a large percentage of expenditure (the Group covered 63% of total expenditure in 2019) using the Desk Analysis & Risk Analysis tool. The Desk Analysis carried out in 2019 with regard to the Group’s strategic suppliers of base metals and raw materials covered three areas in particular: management systems governing ethical sustainability and integrity, the environment, and human rights and workers’ rights.
  • Identification of potentially high-risk suppliers with regard to sustainability factors, weighted using the following matrix: Importance (Expenditure and Business Impact) and Availability (Single Source and Geographical Location).
  • Selection of suppliers identified by the risk analysis as “Potentially high risk” for Sustainability Audits (carried out by an external provider).
  • Analysis of the audit results and, if negative, activation of improvement actions.
• In this regard, 8 supplier audits were carried out during 2019 and, from 2017 to date, 15 sustainability audits have been carried out. Following the audits, the Prysmian Group works with the suppliers to determine the action plan needed, if applicable, in order to implement remedial actions.

Which GRI Standards and corresponding Sustainable Development Goals (SDGs) have been addressed?

The GRI Standards addressed in this case are:

1) Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken

2) Disclosure 414-2 Negative social impacts in the supply chain and actions taken

Disclosure 308-2 Negative environmental impacts in the supply chain and actions taken does not correspond to any SDG.

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

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 the Prysmian Group, 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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