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Sourcing


AkzoNobel has been recognized for its sustainability practices in supply chain management by the Dutch Association of Investors for Sustainable Development (VBDO). See Stakeholder activity.

Business Principles

Our Business Principles have been used in the company’s Vendor Policy to set out the environmental and social standards expected of our suppliers. In the meantime, 85 percent of our product related suppliers have signed our Vendor Policy. The target for 2010 is 90 percent. This is complemented by support visits for suppliers in high growth countries. In 2009, AkzoNobel Sourcing identified 200 strategic suppliers who will be included in the company’s supplier support visits (SSV). The number of SSVs will be expanded to 220 in 2010. The majority of these visits result in improvement plans with progress reviews as required. Most suppliers are enthusiastic about this approach, which has led to improved cooperation between our companies. A few have not been willing, or able to, live up to the responsibility criteria, so we have stopped our sourcing relationship.

In order to further develop SSVs, we have trained 150 procurement and HSE&S professionals in Asia Pacific and Latin America. In 2010, we will further standardize the reporting to improve shared learning and support the development of the second tier supplier assessments.

Examples of sustainability projects in sourcing

Carbon footprint

Sourcing has an important role to play in improving the eco-efficiency and carbon footprint of our products, since raw materials account for more than 70 percent of our cradle-to- gate footprint, and up to 95 percent in our coatings businesses. As part of the Carbon Policy roll-out, we have started working with suppliers to collect footprint information and to identify improvement opportunities – for example by using renewable raw materials. Product footprint information, the willingness to share data and to cooperate on improvements will play a major role in selecting future suppliers.

A new car lease policy (covering 9,000 cars) is being introduced which includes improved technical safety requirements and fuel efficiency and particulate standards. The target is a weighted average of 130g CO2 (e) per kilometer by 2013.

Key supplier management

In 2009, we developed a Key Supplier Management program. This involves cooperating with suppliers to work on value creation and innovation, focusing on sustainability issues such as enhancing eco-premium solutions  for our customers. These programs – which involve multi-year agreements – are being set up with 15 global leading chemical players.

Talent management

The AkzoNobel Procurement Faculty provides standardized training for our worldwide procurement professionals. To date, we have trained more than 300 purchasers in Strategic Sourcing Methodology and Negotiations & Influencing in Sao Paulo, Shanghai, Chicago, London and Amsterdam. In 2009, we trained the Procurement Council – the business and corporate Sourcing leaders – on supplier relationship management, while in 2010 we plan to extend the negotiation and communications skills of this group.

Remuneration

Within Sourcing, the sustainability agenda is linked to individual remuneration. Every member of the Procurement Council and regional procurement councils has at least one sustainability target within their top five personal targets.

Supplier engagement

 

 

 

 

 

% of spend

2007

2008

2009

Target 2010

1

Non-product related.

 

 

 

 

 

Raw material suppliers Vendor Policy signed

81

82

85

90

NPR1 business suppliers Vendor Policy signed

 

 

 

50

NPR1 centrally contracted suppliers Vendor Policy signed

80

89

100

 

 

 

 

 

Suppliers visited since 2007 (cumulative number)

100

152

185

220

Refer to reporting principles for details on comparability of data
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