Material Pillars - Responsible products and services - Responsible procurement
Sanlam Sustainability Report 2011
Responsible procurement
Our procurement policy
Sustainability presents an opportunity to cut costs and contribute to maintaining and achieving societal objectives such as employment creation, social transformation and the protection of environmental assets. Increased scrutiny of business behaviour by stakeholders has led to rising expectations that companies are responsible for environmental, social and governance practices of their suppliers.
Group Sourcing is a Sanlam Group function, residing in Santam, which has the greatest procurement demands. The Centre of Excellence, run out of Santam, plans to expand its influence regionally. The Group Procurement Policy includes supplier selection criteria that promote sourcing from BBBEE-accredited suppliers and black owned businesses, and suppliers that incorporate ESG best practice into their operational processes. Optimising processes and unlocking value in the supply chain remains a key focus area, through considered management of standardisation, minimal duplication and efficiencies. Another focus is to ensure against the creation of monopolies, and ensuring that partners do sustainable business.
We need to ensure that the people we partner with do sustainable business."
– Ebrahim Asmal, Executive Head: Group Sourcing
Environmental selection processes have been further developed this year. Greening initiatives in buildings, reducing business travel through an increase in equipment for video conferencing, cleaning materials and processes needing to be environmentally friendly – are included as criteria for potential and existing suppliers. Suppliers recognise that addressing sustainability issues enhances business potential. Those that adapt the best and the quickest, gain an advantage in securing business.
Looking ahead, we are seeking greater emphasis on environmental issues and enterprise development. Sanlam RSA will measure and report the percentage exceeding R500,000 procurement vetted against pre-set criteria. We plan to develop an environmental and corporate responsibility supply chain strategy with a three-year time horizon to give sufficient warning to key suppliers around potential impact. To ensure that we do not adversely impact BBBEE procurement, the weighting of sustainability criteria will have to be ranked. We will continue to support the growth and upliftment of black entrepreneurs through procurement practices, with particular focus on black female‐owned business development.
When we start looking at sustainability we start looking at the bigger picture - using the example of the solar power"… "The same emphasis that we have placed on BEE we want to do for environmental and other issues."
- Ebrahim Asmal, Executive Head: Group Sourcing
Supplier development
Supplier development is an integral part of our procurement policy. Through our purchasing we are able to develop, in particular, small black-owned enterprises in South Africa contributing to the long-term health of the economy and meeting our BBBEE requirements. Ensuring the viability of those suppliers remains a significant challenge. We contribute to supplier development by assisting with cash flow through means such as soft loans and early payment terms. Sanlam runs a business-orientated educational television programme for entrepreneurs and entrepreneurial competitions. Through Cobalt, Sanlam provides free health checks and advice for small businesses.
Sanlam continues to achieve full points on the enterprise development component of the dti scorecard through our Ubunto Botho (UB) transaction. This provides broad based UB empowerment groupings access to capital, business advice and cross-selling opportunities between shareholding businesses.
