Prepare the procurement
Here you will get help in determining if and when it is necessary to set requirements for sustainable supply chains, as well as in identifying and assessing adverse impact on people and the environment in the supply chain. You also get help with mapping the conditions in the industry in question and with planning for monitoring
Introduction
Good planning facilitates the work throughout the procurement process. Therefore, be sure to allocate time and resources to map and analyze needs, the market and risks.
For the contract term on sustainability due diligence, this step includes:
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Assessing whether it is necessary to use the contract term
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Identifying and assessing adverse impacts in the supply chain
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Mapping the conditions in the industry in question
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Planning for monitoring
Assessing whether it is necessary to use the contract term
Before you carry out a procurement, you need to assess whether it is necessary to set the contract terms for sustainability due diligence.
If the procurement covers any of the Swedish regions prioritized purchasing categories a needs assessment has already been carried out at national level and the contract terms must always be used.
If the work within the framework of the contract is performed under such conditions that Swedish labour law is not applicable, contracting organisations are in some cases obliged to require the supplier to perform the contract in accordance with the ILO core conventions - provided that this is "necessary".
Needs assessment template for procurers and suppliers.
Labour conditions according to the procurement rules (in Swedish only)
The International Labor Organization (ILO) is the UN's expert body for employment and working life issues. Their Declaration on Fundamental Principles and Rights in Working Life commits member states to respect and promote these principles and rights, regardless of whether they have ratified the so-called core conventions.
The core conventions are ten in number and concern five different areas:
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freedom of association and collective bargaining (ILO 87 and 98)
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forced labor (ILO 29 and 105)
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child labor (ILO 138 and 182)
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discrimination in employment (ILO 100 and 111)
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safe and healthy working environment (ILO 155 and ILO 187).
In connection with procurement, contracting organisations therefore need to carry out a so-called needs assessment. The assessment should take a holistic approach and be based on information on risks of unfair working conditions in the supply chain in question. It is therefore not enough to look at where the final manufacturing takes place. Products manufactured in Northern Europe, where the risks are generally lower, often require components or raw materials from countries with higher risks.
However, the needs assessment is facilitated by the fact that it is enough for something to suggest that the contract terms need to be used, in order for it to be necessary to use them. This means that it is basically always necessary to use the terms when you have an international supply chain.
If you want to make a detailed needs assessment, you can use our country risk service.
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How to carry out a risk analysisStep 1: Mapping the supply chain The first step in a risk analysis consists of mapping the supply chain to find out its structure. This includes identifying in which countries the work is carried out, and if possible also in which regions. This is particularly relevant if the work is carried out in any region known to have high risks. Within certain industries such as food, textiles and IT there is a lot of information. For other industries such as pharmaceuticals, however, transparency is low. To obtain this information, you can ask the category manager, the category councils, ask questions of suppliers, find out import data, read audit reports and market analyzes for specific industries. It is also important to identify what type of work is carried out and what type of actors in the supply chain that performs it. Is it, for example, an industry characterized by low wages and health-hazardous processes? Does the workforce consist of migrant workers or seasonal workers? Is the supply chain complex with many subcontractors and a lack of transparency? This type of information is important as both geographical risks, industry risks and product risks need to be taken into account. Step 2: Gather information from credible and independent sources Once you have mapped the origin and the supply chain, the next step is to gather information about the situation of human rights, workers' rights, the environment and business ethics in the relevant countries where the work is carried out, that is, both for final manufacturing, component manufacturing and raw materials. For this you need to turn to credible and independent sources such as international organizations, authorities, voluntary and civil society organizations and global trade unions. Sources Step 3: Identify and assess negative impacts The last step involves assessing the actual and potential negative impact the supply chain is associated with, based on the information that has been compiled in steps 1 and 2. This is to be able to determine which concrete measures need to be taken to manage the risks. Often several risks have been identified and to prioritize them you need to make a seriousness assessment. The most significant risks are prioritized based on probability and seriousness ( read more under point d in process requirement 2 )
Identify and assess negative impact
To identify and assess adverse impact on people and environment is important to increase your understanding of the risks. It is also crucial to know if any additional requirements are needed, for example regarding responsibly extracted minerals, and to determine which components or raw materials are relevant to include in the supply chain transparency requirement.
To facilitate this, the Procurement Authority has a risk analysis service. The service contains information about risks for a number of high-risk products as well as tips on how you can manage the risks. (In Swedish only)
Risk analyses
If you want to identify negative impacts in the supply chain on your own, you can carry out your own risk analysis. This is a method for identifying and assessing risks and gives you information about the risks in the supply chain for the product or service in question.
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How to carry out a risk analysisStep 1: Mapping the supply chain The first step in a risk analysis consists of mapping the supply chain to find out its structure. This includes identifying in which countries the work is carried out, and if possible also in which regions. This is particularly relevant if the work is carried out in any region known to have high risks. Within certain industries such as food, textiles and IT there is a lot of information. For other industries such as pharmaceuticals, however, transparency is low. To obtain this information, you can ask the category manager, the category councils, ask questions of suppliers, find out import data, read audit reports and market analyzes for specific industries. It is also important to identify what type of work is carried out and what type of actors in the supply chain that performs it. Is it, for example, an industry characterized by low wages and health-hazardous processes? Does the workforce consist of migrant workers or seasonal workers? Is the supply chain complex with many subcontractors and a lack of transparency? This type of information is important as both geographical risks, industry risks and product risks need to be taken into account. Step 2: Gather information from credible and independent sources Once you have mapped the origin and the supply chain, the next step is to gather information about the situation of human rights, workers' rights, the environment and business ethics in the relevant countries where the work is carried out, that is, both for final manufacturing, component manufacturing and raw materials. For this you need to turn to credible and independent sources such as international organizations, authorities, voluntary and civil society organizations and global trade unions. Sources Step 3: Identify and assess negative impacts The last step involves assessing the actual and potential negative impact the supply chain is associated with, based on the information that has been compiled in steps 1 and 2. This is to be able to determine which concrete measures need to be taken to manage the risks. Often several risks have been identified and to prioritize them you need to make a seriousness assessment. The most significant risks are prioritized based on probability and seriousness ( read more under point d in process requirement 2 )
Mapping the conditions in the industry in question
The conditions for ensuring sustainability in supply chains vary between different industries. Structural problems that occur in an entire industry, such as lack of traceability, can make work more complex. In such situations, it can be good if companies cooperate jointly within the industry, for example through industry initiatives and labels. Therefore, please have a dialogue with suppliers about the industry's challenges and collective solutions.
Early dialogue (In Swedish only)
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How to carry out a risk analysisStep 1: Mapping the supply chain The first step in a risk analysis consists of mapping the supply chain to find out its structure. This includes identifying in which countries the work is carried out, and if possible also in which regions. This is particularly relevant if the work is carried out in any region known to have high risks. Within certain industries such as food, textiles and IT there is a lot of information. For other industries such as pharmaceuticals, however, transparency is low. To obtain this information, you can ask the category manager, the category councils, ask questions of suppliers, find out import data, read audit reports and market analyzes for specific industries. It is also important to identify what type of work is carried out and what type of actors in the supply chain that performs it. Is it, for example, an industry characterized by low wages and health-hazardous processes? Does the workforce consist of migrant workers or seasonal workers? Is the supply chain complex with many subcontractors and a lack of transparency? This type of information is important as both geographical risks, industry risks and product risks need to be taken into account. Step 2: Gather information from credible and independent sources Once you have mapped the origin and the supply chain, the next step is to gather information about the situation of human rights, workers' rights, the environment and business ethics in the relevant countries where the work is carried out, that is, both for final manufacturing, component manufacturing and raw materials. For this you need to turn to credible and independent sources such as international organizations, authorities, voluntary and civil society organizations and global trade unions. Sources Step 3: Identify and assess negative impacts The last step involves assessing the actual and potential negative impact the supply chain is associated with, based on the information that has been compiled in steps 1 and 2. This is to be able to determine which concrete measures need to be taken to manage the risks. Often several risks have been identified and to prioritize them you need to make a seriousness assessment. The most significant risks are prioritized based on probability and seriousness ( read more under point d in process requirement 2 )
Planning for monitoring
Under the terms of the contract, the supplier must participate and cooperate with you in the follow-up of the commitments and the due diligence process, through dialogue, self-reporting, supply chain transparency and audit.
Keep in mind that it is important that you plan for how the contract term will be monitored already during the preparatory phase, even if the details are set later. At this stage, planning includes ensuring that the organisation has the resources and skills necessary to carry out the monitoring.
the Swedish Regions prioritized purchasing categories are followed up in a joint process led by the Swedish Regions National secretariat for Sustainable Procurement. The results from the follow-ups are published on www.hållbarupphandling.se.
When you plan to monitor a supplier, it can be valuable to review the results of previous follow-ups. It can also save time to contact the Regions National secretariat for Sustainable Procurement to get information about which suppliers will be followed up on in the coming year.
Adda AB has framework agreements for audits that procuring organizations can use.
Adda Inköpcentral's framework agreement Audit and advisory services