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Supply chain management
Strengthening supplier partnerships
Suppliers play an integral role in FLSmidth’s operations and offerings to customers. Mutual success depends on long-standing business ties and strong relationships. We want to engage and collaborate with our suppliers for a more sustainable supply chain. Collaboration is one of FLSmidth’s core behaviors, and this consequently also extends to our supplier relationships.
A message from our COO
Dear Supplier,As a Supplier, you are essential to our business, and we expect you to share our standards of responsible business conduct including environmental management and decent work. We are guided by the UN Guiding Principles on Business and Human Rights and encourage our suppliers to do the same.
Furthermore, we are on a journey of decarbonized products and services, carbon-neutral operations, and a sustainable supply chain. Working with the right suppliers and building long-term, mutually beneficial relationships will have a significant role in our ability to deliver on these goals. In the short term, we aim to have 30% of our spend with suppliers that set their own science-based decarbonization targets.
This is a call to action for our suppliers to reach out to us with questions on the Science Based Target initiative and co-innovation opportunities.
Sincerely,
Asger Lauritsen
Group COO
Supplier engagement
We want to promote responsible business conduct in our supply chain. FLSmidth is a signatory to the United Nations Global Compact and is guided by the United Nations Guiding Principles for
Business and Human Rights and the OECD Guidelines for Multinational Enterprises. We base our supply chain due diligence work on the OECD Due Diligence Guidance for Responsible Business Conduct.
We require all suppliers to commit to the FLSmidth Supplier Code of Conduct. The Supplier Code of Conduct includes requirements in relation to labour, health & safety, environment, compliance and related management systems.
We perform basic sustainability risk assessment screenings when our staff visit supplier sites. The screenings contribute to identifying which suppliers need development and maintaining awareness on sustainability and on-site learning for our staff. We have targets for conducting the screenings integrated into KPIs and regularly monitor performance.
We engage suppliers in dialogue on environmental impact. Specifically on climate change and CO2 reduction. FLSmidth has validated science-based targets and for our upstream supply chain the target is that FLSmidth A/S commits that 30% of its suppliers by spend covering purchased goods and services, will have science-based targets by 2025. We want to engage both new and
existing suppliers to achieve the target.
FLSmidth maintains a global whistleblower hotline which allows employees, business partners and other relevant stakeholders to anonymously report potentially serious allegations concerning financial crimes, such as bribery or fraud, environmental violations, breaches of competition law and human rights violations. The whistleblower hotline is hosted by a third party and allows for fully anonymous and encrypted reporting in several languages.
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