Case study: How Wienerberger promotes sustainability across its supply chain

What are the material issues the company has identified?

In its 2019 Sustainability Update Wienerberger identified a range of material issues, such as employee safety and health, innovative and durable products, climate action, business ethics and compliance, energy efficiency. Among these, promoting sustainability across its supply chain stands out as a key material issue for Wienerberger.

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 Wienerberger engages with:

How stakeholder engagement was made to identify material issues

To identify and prioritise material topics Wienerberger engaged with its stakeholders through an online survey. Almost 500 stakeholders were invited to participate, 80% of them external stakeholders.

What actions were taken by Wienerberger to promote sustainability across its supply chain?

In its 2019 Sustainability Update Wienerberger reports that it took the following actions for promoting sustainability across its supply chain:

• Implementing a group-wide Supplier Code of Conduct
• In 2019, a uniform, group-wide Supplier Code of Conduct was elaborated by Wienerberger in cooperation with internal and external experts and rolled out to almost all operating segments, replacing the previous segment-specific supplier codes of conduct. The implementation of the uniform, group-wide Supplier Code of Conduct was supported by the new group-wide procurement structure managed by the Head of Corporate Procurement.

• Auditing suppliers
• In 2018, a formal training programme run by external certification bodies was introduced by Wienerberger in order to train employees working in Corporate Procurement to perform supplier audits. In 2019, employees working in the procurement units of the country organisations were selected to receive the same type of training for the performance of supplier audits. Corporate Procurement, as a staff function, nominated the employees on the basis of strategic considerations and will roll out the certified external training of employees step by step to all country organisations. The objective is to perform standardised supplier audits throughout the Group and to have at least one certified employee in each country organisation qualified to perform supplier audits. In 2019, Corporate Procurement also began to define uniform follow-up processes to be observed following the supplier audits on the basis of the audit results. Once the process has been fully defined, supplier audits are to be initiated in those areas of procurement and geographic locations where the biggest potential risks are assumed to exist. These audits will cover significant non-financial matters, such as health and safety of employees, respect for human rights, the fight against corruption and bribery, and environmental protection. On the basis of the audit results, the suppliers will then be informed of corrective measures to be taken and deadlines will be set for the implementation of improvements.

• Rating suppliers’ sustainability performance
• Since 2019, Wienerberger has had the sustainability performance and potential supplier risks in selected areas of procurement rated by EcoVadis, an international partner for sustainability ratings (environmental, social, governance – ESG ratings). Within the framework of cooperation with EcoVadis, the sustainability ratings and risk analyses of suppliers in selected areas of procurement are being rolled out step by step. Additionally, an internal data platform (supplier relationship management tool), containing information on the financial terms and conditions of all Wienerberger suppliers, has been implemented. The ratings of the suppliers’ sustainability performance by EcoVadis are also stored on the data platform. This enables Wienerberger to evaluate suppliers on the basis of their sustainability and risk ratings, in combination with their financial terms and conditions.

• Screening suppliers
• Another measure introduced in 2019 by Wienerberger was the monthly screening of all suppliers and customers registered in the SAP (Systems Applications and Products) system via an interactive data platform against international sanctions lists published by the UN (United Nations), the EU and the Office of Foreign Asset Control (OFAC) at the US Department of the Treasury. The screening is performed centrally by a sanctions management software, which runs monthly checks of all customer and supplier master data in the SAP system. Every “match” is transmitted to the local management in charge for assessment and follow-up. The local decision whether to continue doing business with the supplier or customer concerned must be communicated to Corporate Legal Services for further coordination. All decisions taken in this context are documented in the sanctions management software.

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 Wienerberger, 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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