We engage continuously with our customers to understand what they expect from us. As their expectations grow in this area, we are making progress on several fronts:
- ensuring our management systems reflect the highest global standards
- strengthening our due diligence to deepen our understanding of the risks right across our supply chain
- working with other stakeholders to mitigate risks
- building global multi-stakeholder standards with third party assurance both for the steel industry and our supply chain, especially the priority area of raw materials, where risks are highest.
This approach is aligned with the five-step guidance developed originally for conflict mineral supply chains by the Organisation for Economic Cooperation and Development (OECD , ‘the five-step OECD guidance’): manage – identify risks – mitigate – audit – report.
Management systems – Code for responsible sourcing
Our responsible sourcing team works with the corporate responsibility department on our approach, defining the standards we promote, assessing our supply chain risks, implementing and monitoring our systems. On a day-to-day level, we assess how our suppliers manage their performance, by assessing them against our code for responsible sourcing.
Our code was established in consultation with customers, suppliers, peer companies and NGOs, observing international best practice. It covers health and safety, human rights, labour standards, business ethics and environmental management – and we evolve it to incorporate new expectations that emerge such as conflict minerals and modern slavery. It is focused on the procurement of raw materials, industrial equipment and operating products, which we purchase centrally through a single purchasing channel.
All new suppliers must agree to the terms of our code and all existing suppliers are asked to acknowledge it or commit to equivalent standards. Each year we invite our core and strategic global suppliers to complete a questionnaire, and we regularly evaluate any suppliers that do not meet our standards until they can comply. If necessary, we jointly develop an action to help them monitor their progress towards meeting our standards.