Route 2030: ensuring a responsible supply chain
B.I.G. is on course to achieve a zero environmental footprint by 2030. That’s right, zero. To make this journey more tangible, we’d like to offer you a passenger’s seat from which you’ll be able to really get up close and immerse yourself in our various sustainability projects. In this edition: how we ensure that all of our suppliers and other business partners behave ethically and are committed to sustainability.
According to Deloitte’s third-party risk management survey, in the past 3 years, no less than 84% of organizations have experienced a third-party ESG incident, i.e. an issue related to environmental, social or governance practices with one of their business partners. While ESG awareness has grown significantly over the past decade, many organizations still lack the formal mechanisms needed to assess or prioritize ESG risks when engaging with third parties. These mechanisms are essential to ensure a more ethical supply chain and a strong focus on sustainability.
Although B.I.G. is a vertically integrated group, we have a vast third-party network of suppliers, clients, distributors ... that extends to every corner of the world. To be able to achieve a real and lasting impact, we need to ensure that we are all fully aligned in terms of key sustainability values and principles. That’s why we have recently created and implemented a set of third-party risk management (TPRM) mechanisms.
Why we believe in TPRM
“At B.I.G., we want to do business in a transparent, ethical, and responsible way”, says Group Internal Audit & Risk Director Els Hostyn. “That is why integrity, open communication, regulatory compliance, and respect for human rights and for the environment are of vital importance in everything that we do. We consider TPRM to be indispensable as a means of ensuring that every single one of our third parties is on the same page as we are. By adopting a risk-based approach, we can better assess and minimize the likelihood of third-party ESG incidents. Moreover, it will also help us to avoid regulatory penalties, obtain certificates, and, above all, become a genuinely responsible business.”
Let’s take a closer look at the 3 different TPRM mechanisms we have recently implemented.
Mechanism 1: the Supplier Code of Conduct
Last year, we established our Supplier Code of Conduct. This is a document in which we outline the standards and key principles on ethical and social behavior, governance, health and safety, and environment with which we expect our suppliers to comply. Every B.I.G. supplier is required to adhere to this Code of Conduct, and high and medium risk suppliers are requested to formally sign it. What’s more, we also expect our suppliers to demand similarly high standards from their own suppliers.
Mechanism 2: internal risk assessments
From 2023 onwards, before engaging with any new supplier, we will first need to carry out an internal risk assessment focused on three areas: human and social rights, environmental management, and governance. Suppliers who are classified as a medium or high risk in one or more of these areas will then receive an additional questionnaire. Based upon the answers they give, we will then decide whether or not to proceed with the third party, along with any remedial action that may be required.
Mechanism 3: sanctions screening
Alongside the internal risk assessment, we have also introduced sanctions screening. This applies to all third parties with whom we work, including clients, suppliers, distributors, consultants, service providers, etc. We use a tool to check whether a third party is included on one of the many publicly available sanctions lists. If so, doing business with them will obviously be out of the question.