Responsible Supply Chain Management
Partnership and Control
Through our supplier management, we want to ensure that fundamental ethical, environmental and social standards are complied with – while also ensuring high quality, reliable delivery and competitive prices. To avoid violations of these supply chain standards, we follow corresponding strategies, processes and guidelines, which we continuously improve.
Our supplier analysis consists of four main elements: a supplier risk assessment, an alert system, a material risk assessment, and a risk response tracker. Moreover, we use various instruments, which depend on the country risk, industry risk and the effects on business operations.
We have been part of the Together for Sustainability (TfS) initiative since 2014 and require our suppliers to be evaluated via self-reported information or through audits by TfS. In selected cases we conduct our own audits.
Mica supply chain: We hire an internationally active consultancy firm to conduct the audits. The Indian organization IGEP carries out additional checks.
Together for Sustainability
Through TfS, we have access to more than 1,250 assessments of our suppliers.
Preventing child labor in the mica supply chain
Mica is an important raw material for our pigments, which are used in the cosmetics and food industries and for automotive coatings alike. We purchase mica mainly in the Indian states Jharkhand and Bihar. These are among the poorest regions of India and also politically unstable, which is why child labor is also found here. Access to healthcare is very limited and only a few children have the opportunity to attend school. We are taking on responsibility in the region and have deliberately decided to maintain our business relationship with local suppliers in eastern India.
We explicitly reject child labor and are committed to safe working conditions in the mines and the processing plants. We are working to ensure that the jobs are a livelihood for the workers and their families, but are also committed to improving the overall living conditions – for example by supporting four local schools and a health center. We have taken a number of measures to monitor compliance with our strict social and environmental standards. We carry out regular on-site inspections at our suppliers, both with our own employees and by third parties. This includes both comprehensive announced audits and regular unannounced inspection visits.
Responsible conflict minerals sourcing
We procure and use various raw materials from multiple sources. Several of our products contain minerals that are extracted from mines. Our aim is to avoid that the minerals we source come from mines controlled by armed militia in conflict and high-risk areas. This violates human rights standards and our company values. Therefore, we aim to comply with applicable laws and international standards, in particular: EU Conflict Mineral Regulation (EU) 2017/821 and German Law 585/19 implementing (EU) 2017/821 of the European Parliament. We also aim to have practices consistent with the Dodd-Frank Wall Street Reform and Consumer Act, Section 1502 and OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas.
Our overall aim is to source materials responsibly and conflict-free and not to contribute to adverse impacts through our sourcing activities. While working to identify, prevent, mitigate and remediate adverse impacts, we aim to deploy as much effort as possible to ensure we do not block market access for compliant artisanal and small-scale miners who represent some of the most marginalized communities in the world.
We developed a comprehensive due diligence management program and respective practices to address conflict minerals originating from conflict and high-risk areas and our program framework is in alignment with applicable laws and international standards. We will address any suspected misconduct of our Responsible Minerals Sourcing Charter, which can be reported through our whistleblowing hotline (www.bkms-system.net/ISPEAKUP).
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Compliance & Ethics
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