A modern company must take responsibility not only for its own operations, but also for the responsibility of the supply chain. At Teknos, sustainable procurement is an integral part of our Corporate Responsibility Program and is managed by the Group's Procurement Department. Find out what responsible sourcing is and how it is implemented at Teknos.
Today, the sustainability discussion does not cover only company own operations, but the entire supply chain. Sustainable procurement, or responsible sourcing, brings many benefits to the company, including more reliable supplier relationships, cost savings, improved supply security, risk management, innovative solutions and raw materials. By investing in the responsibility of the supply chain, also the so-called hard indicators of procurement, such as inventory management and on-time delivery, are often improved.
Various stakeholders are demanding transparency into the operations of a company. In addition to financial figures, social and environmental issues such as working conditions or the origin of the raw materials in the upstream of supply chain are of increasing interest to the general public, investors and customers. For the company itself, the ethics of operations can be an important reason to invest in sustainable procurement.
Teknos Group Procurement team is responsible for sustainable procurement at Teknos. Sustainability is integrated into every procurement process. Sustainable procurement includes for example supplier selection, supplier evaluation and audits and various policies that guide operations such as the Supplier Code of Conduct. This policy takes into account issues related to labor rights, human rights, health, safety, anti-corruption work and the environment, and has been formulated with respect for the UN Global Compact and ILO International Labor Standards.
“In practice, sustainable procurement can mean, in addition to mapping and evaluating a supplier network, things such as buying only what is needed, finding more sustainable raw materials or calculating life cycle impacts. For example, choosing raw materials with the least possible social, economic and environmental burden”, Group Procurement Manager Satu Rauhala explains.
Teknos believes that what matters is how we act and make responsible decisions. We make sure that everyone who works in the field of procurement, but also our chemists who develop recipes and research raw materials, know our principles of sustainable procurement.
"Responsibility must start with the choice of raw material options or suppliers, and it must be taken into account throughout the supply chain, down to the end customer," Satu emphasizes.
Our supplier network includes hundreds of very diverse suppliers, from large global companies to small, local companies. Most of our raw material suppliers come from Europe. We have set two group-level corporate sustainability targets for the supply.
“At Group level, we aim to evaluate 80% of our suppliers with EcoVadis assessment tool by 2025. In EcoVadis assessment, suppliers are evaluated towards four different topics: the environment, labor and human rights, ethics and sustainable procurement. Each section is scored, and the total score of the assessment is the weighted average of the different sections. Through EcoVadis platform, we are able to put forward suggestions for improvement or corrective actions to our suppliers and thereby help the whole industry to become more sustainable. In addition to EcoVadis, our target is that 95% of our suppliers should have signed and approved our Supplier Code of Conduct by 2025*”, Satu explains.
The capabilities and resources of our suppliers to respond to sustainability inquiries or to report on this topic can vary widely. However, we always make sure that our suppliers act responsibly and in line with our requirements and our company values. We also secure our supply chain with supplier audits. In 2019, we will conduct a total of eleven supplier audits.
“In the long term, our goal is to make our supply chain more transparent in collaboration with various stakeholders and to extend supplier transparency to our sub suppliers”, Satu concludes.
* in proportion to the raw material spend