RESPONSIBILITY TOWARDS SUPPLIERS
Suppliers are one of the key groups of stakeholders of the ORLEN Group. They are required to accept defined criteria regarding ORLEN's values and responsibility. The Purchasing Area works closely with Stakeholders, analyzes their needs, sets common priorities, plans, key performance indicators and improvements.
In a significant step towards ensuring a responsible supply chain, PKN ORLEN incorporated responsible business and sustainability criteria into its procurement management standard. The Company promotes social responsibility among its suppliers and seeks to cooperate with trade partners that respect human rights and operate in compliance with the law, ensure safe and fair working conditions, follow the best standards of ethical conduct and care for the environment. CSR criteria have been defined and compiled into a single document entitled ‘Supplier Code of Conduct’. Compliance with the Code is a mandatory criterion in the process of trading partner selection at ORLEN Group companies. The suppliers are selected based on the ORLEN Group’s standardised and uniform social, environmental, legal, and ethical criteria. All existing and potential suppliers of the ORLEN Group are obliged to know and accept the requirements concerning human rights, compliance with the law, safe and decent working conditions, the highest ethical standards, and care for the natural environment. Acceptance of the Supplier Code of Conduct by tenderers and suppliers is a formal precondition for participation in procurement procedures. If a tenderer fails to accept the Code, its bid will not be considered in the procurement process because the formal criteria are not satisfied
The purpose of the Code is to promote responsibility among the ORLEN Group’s stakeholders and encourage responsible practices among the suppliers. Moreover, every tenderer taking part in procurement procedures must read, understand and accept the ORLEN Group Anti-Corruption Policy and the PKN ORLEN Rules for Accepting and Offering Gifts.
|
|
|
2020 |
2019 |
|
PKN ORLEN suppliers required to know and accept the "PKN ORLEN Supplier Code of Conduct", the "Anti-Corruption Policy of the ORLEN Group" and the "PKN ORLEN Rules for Accepting and Offering Gifts" |
[%] |
100 |
100 |
The ORLEN Group trades with a group of carefully selected suppliers. In 2020, just under 4,000 tendering procedures were held at PKN ORLEN. The Company worked with more than 8,500 suppliers, but the ORLEN Group as a whole had relationships with over 24,000 vendors.
In an effort to continuously improve procurement processes, the Group works to enhance and ensure greater consistency of vendor selection procedures. We developed a model for vendor selection in procurement category management strategies, and the key suppliers are evaluated on a regular basis as part of the supplier relationship assessment process. The selection and assessment criteria are based, among other things, on best market practices. They make it possible to mitigate reputation, financial and process risks, and ensure high quality of the supplier relationships.
The ORLEN Group’s Procurement Centralisation Project, launched in December 2020, is a key element of the responsible supply chain. The overriding aim of the project is to transform procurement organisation into a centralised function within the ORLEN Group. Conforming to global standards (the benchmark of 15 companies in the oil and gas industry), the centralisation model provides for the creation of a central hybrid organisation, with most of the procurement done centrally at PKN ORLEN (approximately 80% of spending). The project will significantly improve the efficiency of the procurement function, mainly through departure from the dispersed organisation structure.
In 2020, goods and services sourced from Płock-based companies accounted for some 11.5% * of PKN ORLEN’s spending (*excluding purchases from suppliers of crude oil and natural gas). By cooperating with suppliers from its close neighbourhood the Company supports growth of the local market and implements the objectives of its CSR strategy within the supply chain.
