Global responsible sourcing programme
In 2020, Gränges developed a new global Responsible Sourcing Policy1) which outlines group-wide principles and requirements on responsible sourcing. The policy applies to all Gränges’ sites and concerns individuals who are in contact with suppliers. In line with the policy, all sites are to operate a local responsible sourcing programme covering significant suppliers, as outlined in the infographics on this page. Gränges sees the responsible sourcing programme as a platform to enforce sustainable practices, ensure continuous improvement, develop collaboration and build lasting relationships with its suppliers.
Global supplier sustainability requirements
Gränges has a Supplier Code of Conduct which all significant suppliers are requested to sign. The intention is to increase awareness and transparency of responsible and sustainable business practices in Gränges’ supply chain. By signing, suppliers declare to observe all applicable laws and regulations, including the ten principles of the UN Global Compact, and to promote the implementation of these principles in their own supply chains. In 2020, 97 per cent (99) of significant suppliers had a valid commitment to the Supplier Code of Conduct or had an equivalent standard in place.
Gränges' Supplier Code of Conduct
Sustainability risk screening and desktop assessments
To ensure compliance with Gränges’ Supplier Code of Conduct and to identify and mitigate sustainability risks in the supply chain, significant suppliers are annually screened in a desktop tool for potential environmental, social and corruption risks depending on the purchasing category and country of origin. Suppliers identified to have a potential medium or high sustainability risk are thereafter required to complete an evidence-based desktop sustainability assessment, currently managed by EcoVadis, a provider of sustainability analyses and ratings. In 2020, 25 of Gränges’ significant suppliers had a third-party verified sustainability assessment available. More information about the process for risk screening and desktop assessments can be found in the Responsible Sourcing Policy1).
Supplier follow-up and engagement
Results from the desktop assessments are integrated into the local supplier review procedures, e.g. supplier scorecards, discussions and on-site visits. The company also conducts on-site supplier audits depending on suppliers’ strategic importance and performance. Such audits mainly focus on ensuring compliance with Gränges’ quality and delivery requirements but sustainability criteria are also included. In 2020, five on-site supplier audits (seven) were conducted. Going forward, Gränges aims to further harmonize the processes of the desktop sustainability assessments with the audits. The company also aims to provide sustainability training to support suppliers on their paths to becoming more sustainable companies.
Gränges uses an internal escalation process to decide on appropriate actions in cases where a supplier declines to sign the Supplier Code of Conduct, declines to complete the sustainability desktop assessment, or after a supplier has received a low sustainability re-assessment score. Deviations can lead up to blocked purchase orders and business termination.
1) Available on granges.com/sustainability/policies
Note: All numbers exclude Gränges Konin and Gränges Powder Metallurgy.