Responsible Sourcing Forum - aim-progress.com · Unilever Michele Pisetta Sustainability Manager...

Responsible Sourcing Forum

Kuala Lumpur, Malaysia – 24th October 2017

Welcome & Introductions

David Lawrence

Executive director

AIM-PROGRESS

Safety and logistics notice

Anti-trust caution

The Association shall not enter into any discussion, activity or conduct that may infringe, on its part or on the part of its members, any applicable competition law. By way of example, members shall not discuss, communicate or exchange any commercially sensitive information, including non-public information relating to prices, marketing and advertising strategy, costs and revenues, trading terms and conditions with third parties, including purchasing strategy, terms of supply, trade programmes or distribution strategy. This applies not only to discussions in formal meetings but also to informal discussions before, during and after meetings.

Agenda

• 9.00am – 9.15am – Welcome and introductions• 9.15am - 10.00am - Overview of AIM-PROGRESS and of the

responsible sourcing programs• 10.00am – 11.30am – South-East Asia and Malaysia overview• 11.30am – 12pm – Testimonials• 12pm – 1.15pm – Lunch• 1.15pm – 2.15pm First round of workshops• 2.15pm – 2.30pm – Break• 2.30pm – 3.30pm – Second round of workshops• 3.30pm – 3.45pm – Break• 3.45pm - 4.45pm – Third round of workshops• 4.45pm – 5.00pm – Closing remarks

Afternoon workshops

Workshop A – Managing migrant labour- What are the specific vulnerabilities of migrant workers to abuse and exploitation?- What can we all do to address these vulnerabilities including due diligence?

Workshop B – Sustainable land use- What is the journey of early adopters in communicating and implementing sustainability/NDPE (No Deforestation, No Peat, No Exploitation) policies?- What can we learn?

Workshop C – Grievance mechanisms- Why are they important?- How to handle complaints?- Are all employees aware of how to file complaints or report issues?

Welcome & Introductions

Annemarieke de Haan

General Manager Malaysia & Singapore

Unilever

Rahul Vashistha

Head of Procurement ZAOA,

Nestlé

Welcome & Introductions

Annemarieke de Haan

General Manager Malaysia & Singapore

Unilever

MAKESUSTAINABLE

LIVINGCOMMONPLACE

A NEW WAY OF DOING BUSINESS

EQUAL OPPORTUNITY & SUSTAINABLE LIVELIHOODS

SUSTAINABLY SOURCEDRAW MATERIALS

THE PLANET PROTECTEDFOR FUTURE GENERATIONS

ACCESS TO WATER SANITATION & HYGIENE FOR ALL

OUR VISIONTO GROW OUR BUSINESS,

WHILST DECOUPLING OUR

ENVIRONMENTAL FOOTPRINT

FROM OUR GROWTH AND

INCREASING OUR

POSITIVE SOCIAL IMPACT

POSITIVE SOCIAL IMPACT

BUSINESS GROWTH

DECOUPLEENVIRONMENTAL

FOOTPRINT

TAKING ACTION

THERE’S NEVER BEEN

A BETTER TIME TO CREATEA BRIGHTER FUTURE

Welcome & Introductions

Rahul Vashistha

Head of Procurement ZAOA,

Nestlé

Overview of AIM-PROGRESS

Benjamin Ware

Global Responsible Sourcing Leader

Nestlé

AIM-PROGRESS co-chair

Brian Kramer

Director, Global Sustainability

PepsiCo

AIM-PROGRESS co-chair

AIM-PROGRESS:

A global forum of branded, fast moving consumer goods manufacturers (FMCG) and common suppliers

Our mission: “Positively impacting people’s lives through our combined leadership of robust responsible sourcing practices throughout our supply chains”

AIM-PROGRESS comprised of 40+ member

companies

AIM-PROGRESS Member Scope

Our purpose

Raising the bar for responsible sourcing…

…in the FMCG supply chain…

…through converging standards and practices….

…thereby making a positive impact on people’s lives

Our 3 key objectives

1. Building member capability All member organisations are competent and executing robust responsible sourcing programs

2. Effectively assuring compliance in our supply chainsEnsuring increasing supplier compliance as expectations rise through having in place increasingly aligned practices, standards and metrics

3. Driving continuous improvement Demonstrating activities of responsible sourcing which go beyond relevant legislation, international standards and company codes

Our activities

➢Mutual Recognition - “An audit for one is an audit for all”

➢Capability Building - of members and suppliers

➢Human Rights - implementing UNGPs

➢Business Integrity - tackling bribery and corruption in the supply chain

➢Environment - taking your commitments through the supply chain

➢ Impact measurement - are we positively impacting people’s lives?

Mutual Recognition of Audits

An Audit for one AIM-PROGRESS member can be an audit for

all AIM-PROGRESS members

The purpose of Mutual Recognition is to reduce audit duplication in

the supply chain. Recognizing ethical compliance audits conducted

on behalf of another member helps:

• Reduce audit fatigue and cost burden on suppliers

• Reduce time investment of buyers

• Shift focus from audits to performance

Mutual Recognition of Audits

Framework Agreement

• All AIM-PROGRESS members

agree to the Mutual

Recognition framework

• Suppliers can share their audit

results in order to meet

multiple customer needs

• Shared list of over 19,000

audited suppliers

Getting Your Audit Recognized – 3 steps

✓ Complete an audit conducted by a recognized audit firm and to a recognized

standard as outlined in the framework.

Examples include: SMETA 6.0, URSA, SGP

**Ensure you utilize the most updated SMETA version for full recognition

✓ Pay for the audit to ensure you own the audit report and can share the

results

✓ Upload the results to a common platform like Sedex or share the report

directly with customers

Why are your customers interested in Responsible Sourcing

➢ Consumers expect brands to behave in a responsible manner

➢ Companies need to know their supply chains and be able to trust their

suppliers

➢ Companies need to ensure that responsible sourcing assessment are

conducted to highlight gaps in the supply chain

➢ Responsible Sourcing enables ongoing improvement in the industry

AIM-PROGRESS helps increase efficiency by sharing data –

“an audit for one is an audit for all”

4 pillars of Responsible Sourcing

➢ Workers are treated fairly

➢ The workplaces are safe and protect the

worker’s health

➢ Companies care about their environmental

impact

➢ Companies behave with integrity and

honestyEnvironmental

ManagementBusiness Integrity

Health & SafetySocial/Human

Rights

Responsible Sourcing Cycle – Commonalities on the supplier assessment

journey

Synergies towards common

methods & data

Supplier Engagement

Supplier Assessment

Risk Assessment

Audit

Corrective Action Plan

Building Supplier

Capability

Common formats

include Sedex and

EcoVadis SAQs

Companies make

individual risk

assessments

Determined by

individual companies

Mutual Recognition: Companies agree to recognise audits done on behalf of

other customers. Audits can also be shared using online platforms.

Sharing of

methodologies for

corrective action plans.

Common supplier

training events

Reputations: Hard to build... Easy to lose

33

Legislation Trend: Disclosure/Certification

• Disclosure Requirements - e.g. UK Modern Slavery Act, CA Transparency in

Supply Chains Act

• Compliance Requirements – e.g. Executive Order 13627, Dodd-Frank,

Consumptive Demand Repeal

The Requirements reach across the supply chain

Overview of the co-hosts’ Responsible Sourcing Programs

Eugeny Krapovnitsky

Procurement Director Markets(Thailand, Malaysia, Singapore)

Unilever

Michele Pisetta

Sustainability Manager

Ferrero

Yann Vuillerod

Responsible Sourcing Manager

Nestlé

Brian Kramer

Director, Global Sustainability

PepsiCo

Overview of AIM-PROGRESS and

the Responsible Sourcing Programs

Michele Pisetta

Sustainability Manager

Ferrero

This document must be disclosed only to authorized individuals. Any reproduction and/or disclosure must be subject to Information Owner prior consent.

Our Responsible Sourcing Program

&

Sustainable Supply Chain

Sustainable Agriculture:Ferrero Farming Value Program

Supplier Engagement:Supplier Sustainability Program

Supplier CSR Assessment

Ethical Compliance

✓ Ferrero‘s Code of Business Conduct & long term relationship with suppliers✓ International guidelines (OECD, ILO, UN, FAO) 6

SHARING VALUES TO CREATE VALUE• Partnerships• Focus on impact and results• Beyond certifications

Overview of AIM-PROGRESS and

the Responsible Sourcing Programs

Yann Vuillerod

Responsible Sourcing Manager

Nestlé

38

Nestlé Responsible Sourcing

AUDITING

Audits, carried out by independent

verification firms, check

whether our direct suppliers are

implementing our Supplier Code

(led by CO-PRO).

FARM ASSESSMENTS

Farms and plantations are assessed

on their implementation of our

Responsible Sourcing Guideline

by partner organisations such as

Proforest and The Forest Trust

(led by CO-PRO).

FARMER CONNECT – SOURCING

DIRECT FROM FARMERS

We purchase directly from

farmers or farming collectives,

and plantations around

the world (led by CO-AGR).

TRACEABILITY

We work with our direct suppliers

to map the supply chain back to

origin, right down to farm and

smallholder level, identifying

everyone involved at every stage

(led by CO-PRO).

Tier 1 (direct) suppliers

Sub-tier suppliers

Farm and plantations

RS AuditsTier1

Targets

2017

60%

RSUpstream

Palm OilSugar

Pulp & Paper

Fish & Seafood

SoyaVanilla

DairyMeat, Poultry &

EggsHazelnutsCocoa

Coffee

40%

60%

« Go, See, Think, Do »

Overview of AIM-PROGRESS and

the Responsible Sourcing Programs

Brian Kramer

Director, Global Sustainability

PepsiCo

Escalation of Critical Issues

Initial Risk

Assessment

Supplier Code

of Conduct

Training

Site Level Self-

Assessment

Questionnaire

(SAQ)

On-site Audit

(SMETA 4 Pillar)

-or-

Mutually

Recognized

Audit

CAP

Verification

&

Follow-up

Audit

PEPSICO SUSTAINABLE SOURCING PROGRAM (SSP)

Focused on continuous improvement

within business critical 3rd party

manufacturing sites.

Overview of AIM-PROGRESS and

the Responsible Sourcing Programs

Eugeny Krapovnitsky

Procurement Director Markets

(Thailand, Malaysia, Singapore)

Unilever

The Unilever responsible

sourcing program

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