Sustainability in Supplier Management aims to ensure that the way we conduct business with our suppliers is in line with environmental, social and ethical standards. Bayer regards adherence these sustainability standards within the supply chain as a crucial factor in the value chain.
By acting responsibly in collaboration with our suppliers, we aim to minimize risks and create stable, long-term business relationships with our partners. It is also an important strategic lever for Bayer in safeguarding both its global competitiveness and the supply of materials and services. For this reason, the company applies not just economic standards, but also environmental, social and corporate governance (ESG) standards in choosing new suppliers or continuing its relationships with existing ones. These principles are defined in Bayer’s Supplier Code of Conduct, which generally forms the basis for our collaboration with suppliers.
To improve sustainability practices within the supply chain we follow a 4-step management process:
Bayer verifies the observance of the code principles by our suppliers through online assessments, conducted by EcoVadis our external sustainability rating provider or on-site audits by external auditors. Suppliers are selected for these evaluations based on a combination of country and category sustainability risks as well as according to their strategic importance. We expect that all suppliers fulfill our sustainability expectations, i.e. ‘Green’ EcoVadis (i.e., >=45/100) or equivalent sustainability audit score.
Bayer’s goal is to have all strategically important legacy Bayer suppliers evaluated by the end of 2020. This group includes suppliers with a major influence on business in terms of, for example, procurement spend and long-term collaboration prospects (three to five years). By 2020, we furthermore aim to evaluate all legacy Bayer suppliers with a significant procurement spend (> €1 million p.a.) that are regarded as potentially high sustainability-risk suppliers due to their combined country and category sustainability risk. Throughout 2019 we start to integrate legacy Monsanto suppliers into our 4-step management process.
Bayer recognizes that our personnel and supply base should reflect the diversity of an ever-changing market place that knows no geographic boundaries. Our commitment to Economic Development through Bayer’s Supplier Diversity Program is only one of many ways in which we fulfill our mission. Inclusion, diversity and internationality are hallmarks of Bayer in key markets like the United States, and through Bayer’s Supplier Diversity Program, we provide comprehensive training, extensive resources, and opportunities for suppliers to strengthen their businesses in this regard.
In our Supplier Code of Conduct we furthermore encourage our suppliers to have an active Supplier Diversity Program by engaging with diverse owned business.