Since 2008, we have been working systematically to implement the Code and to identify, minimize and monitor supplier risks. The purpose is to ensure the availability of important products and contribute to mutual improvement initiatives.
An initial risk assessment of all suppliers is conducted. Monitoring takes the form of self-assessment and, if necessary, independent third-party audits.
Our starting point is to focus efforts where they do the most good. Priority supplier and purchasing categories are those
- for which we have identified high risk and significant improvement potential
- where we are a major player and have a good opportunity to exert an influence
- that are business critical
Each supplier audit must make a difference!
A clear goal is that each completed audit will contribute to the improvement. If we discover a derogation from our Supplier Code of Conduct, we draw up an action plan with the supplier. Depending on the type and severity of the derogation, a follow-up audit is conducted within 6 to 12 months. Only when the supplier has demonstrated that all derogations have been remedied is the audit considered to be completed and approved.
Experience so far shows that the ability to drive change and improvement is greatest among the suppliers where we were first on the scene conducting audits. Examples of measures that suppliers have carried out after an audit include payment of overtime, training of their own internal auditors and improved procedures for protective equipment.
Successful cooperation with risk commodities
In recent years, extensive efforts have been conducted in the area of soy and palm oil. These two commodities are important to Lantmännen but are also often associated with problematic growing conditions and complex supply chains. Lantmännen has chosen to actively participate in the international Roundtable processes, which work for sustainable production of soy and palm oil. We have also been pioneers in the purchasing of soy and palm oil with RTRS and RSPO certification. The processes have proved an effective way of driving change in complex global supply chains. The aim for the future is to develop similar proactive international processes for other priority purchasing categories with specific risks.