Increasing sustainability across our supply chains
Introducing supplier SG evaluation as part of data validation audit
ROSATOM’S SUSTAINABLE PRACTICES
Case presented by Rosatom’s Sustainable Development Department and Quality Control Department. The data is as of September 1, 2021.
- Quality management of the State Corporation "Rosatom"
- Russia (mostly)
- Industry organizations
- Russian suppliers
- International suppliers (in the future)
Since October 2020, ROSATOM is a party to the UN Global Compact (UNGC) and has assumed obligations to implement in its activities the 10 principles of the UN Global Compact in the field of human rights, labor relations, environment and anti-corruption ("the SD principles"). This involves regular efforts to increase the level of maturity in sustainable development (hereinafter referred to as SD)
not only for ROSATOM and its organisations, but also for the suppliers of goods and services with whom it cooperates. UNGCG includes a responsible approach to supply chain development among the most important business practices that define SD leadership.
A sustainable supply chain is about managing environmental, social and economic impacts of and on the organization, and promoting best corporate governance practices throughout the product or service lifecycle.
In practice, this means embedding SD principles in supply operations by developing SD requirements for suppliers, conducting SD audits of suppliers (supplier SD assessments), identifying development areas and/or corrective actions, training on SD topics, and assessing supply chain risks.
One of the first steps toward forming a responsible supply chain in the industry is the inclusion of the supplier's SD evaluation in the data validation audit procedure (hereinafter, DVA). The corresponding addition was approved by ROSATOM's Order No. 1/857-P of 09.07.2021.
DVA is carried out at the selection stage of the procurement with respect to suppliers of products purchased by ROSATOM's enterprises. In addition to checking suppliers for the necessary competencies, including technological preparation of production, ensuring the safety of purchased goods and finished products, maintaining technological equipment in working order and other criteria, filling in the SD questionnaire was also added to the audit procedure.
The questionnaire consists of 9 sections and 37 questions on SD aspects and is completed by the supplier himself, with each answer to be substantiated by specifying the relevant regulating document. The questionnaire is to be completed when bidding for participation in industry procurement procedures. Four vendors were scheduled to be evaluated for SD by the end of 2021.
Aspects of SD include the following audit areas: environmental protection, climate impact management, occupational health and safety and decent working conditions, respect for human and workers' rights, quality management, as well as non-discrimination, corruption, unfair market practices, compliance with ethical business practices.
Based on the information obtained as part of the DVA, ROSATOM can give feedback and recommendations to the supplier to improve the level of maturity in the field of SD. At the moment, the results of the supplier's SD evaluation do not affect the decision to enter into a contract with the supplier, but are an instrument of interaction, development of the supplier and its involvement in SD activities.
- Improving the quality of suppliers' work
- Reducing direct and indirect losses from possible production disruptions, ensuring continuity of the production process
- Improving the competitiveness of the business as a whole and the quality of the end product