With a supplier network of over 9,000, we have an opportunity to influence the social and environmental practices of a range of businesses. We are talking to more suppliers about these issues and one of our largest suppliers has now adopted our approach to manage its own supply chain.
Any effort to manage our direct environmental footprint must necessarily address the impact we make through our choice of goods and services. Since 2005, we have included social and environmental considerations into our choice of suppliers.
We ask suppliers to provide us with information about how they manage the social and environmental issues associated with their business as a standard part of our tender process and conduct regular contract reviews. This includes how they identify and manage risks to their business, whether they have systems to minimise their environmental impact, details of their employment and health and safety practices and whether they engage with their stakeholders.
This year the number of suppliers who completed this assessment grew from 100 in 2006 to 170.
We also applied a more detailed assessment process to 30 suppliers who make up a high proportion of our total annual spend and whose products and services have a potentially high environmental impact.
This year we met with each of these suppliers to review their social and environmental assessments so we could help them understand some of the issues raised and what remedial action might be required. In many cases we invited a subject matter expert with knowledge of the supplier's area of business to these meetings to further inform the discussion.
Ninety-three per cent of these suppliers have now agreed on a social and environmental performance improvement plan and we will continue to work with them to further develop and implement these plans.
EXPANDING OUR INFLUENCE
As a measure of our potential influence on other businesses, one of ANZ's most important suppliers, property and facilities manager, Jones Lang LaSalle (JLL), is now using ANZ's supply chain management approach on its own suppliers.
JLL manages 38 commercial sites, 800 ANZ branch sites and more than 2,000 ANZ ATMs. JLL's role ranges from identifying suitable new ANZ sites to the day-to-day management of security, cleaning, fixtures and fittings, general maintenance, air conditioning and electrical services. The activities of JLL and its suppliers therefore heavily influence ANZ's overall environmental footprint.
JLL has asked 32 of its own suppliers involved in providing products and services to ANZ to complete ANZ's self-assessment questionnaire and now tracks and reports monthly to ANZ on the social and environmental performance of these suppliers in addition to its own progress. The commitment of JLL suppliers to this process has grown over the year, with 88% now responding the JLL's request to complete the ANZ questionnaire, up from 65% in March.
Based on these assessments, we identified those key JLL suppliers that we should work with more closely through the development of social and environmental performance improvement plans.
As well as influencing the way JLL interacts with its suppliers, we are also learning from JLL's expertise in building sustainability and engineering to reduce our direct environmental impact.
This year we have worked with JLL's National Sustainability Director on ways to better measure energy use in our buildings and identify energy efficiency opportunities that will make a real difference to our footprint. The Environmental Performance Working Group comprises representatives from both ANZ and JLL and meets monthly to review the recent environmental performance of ANZ buildings and agree on the most appropriate measures to improve that performance.
FUTURE CHALLENGES
We have the framework in place to assess the social and environmental performance of our suppliers. Now we are working on gathering better information and using the information we gather more effectively.
Our focus has so far been on environmental issues, but this year we expanded our supplier questionnaire to include more specific questions about employment practices and human rights. In the coming year we will begin gathering more information about how our suppliers manage these wider business issues.
We also plan to develop sector-specific social and environmental standards to provide suppliers with guidance which is more relevant to their type of business.
'What ANZ expects of its suppliers, we're now expecting of ours.'
Dino Fornito, National Procurement Manager, JLL ANZ Account
