We provide highly complex and tailormade logistics solutions for our customers along global supply chains. For more information about the nature and scope of our services, please refer to the Company Profile section. We also coordinate the entire supply chain and establish integrated logistics chains, which we manage across the entire value creation process – especially in the areas of project and process management, technology, IT and quality. In this, we mainly work with products and components provided by our customers. We want to honor our responsibility and strive to ensure that our direct suppliers comply with human rights and environmental due diligence obligations. Our own commitment in this regard was underscored by the entry into force of the German Supply Chain Due Diligence Act (LkSG) in 2023.
The centrally managed purchasing processes at BLG encompass more than 100 product groups and are handled by our central Purchasing department. Our main procurement markets are located in Germany and neighboring EU countries, which are also subject to binding sustainability standards.
Clear standards, clearly communicated
We communicate very transparently to our customers how we meet our ethical, social and environmental responsibilities. We expect no less of our suppliers and take the relevant aspects into account when selecting suppliers and awarding contracts. For example, when commissioning subcontractors for transport services, we pay particular attention to industry-specific human rights risks such as the appropriateness of remuneration, the right to freedom of association, and respect for general occupational health and safety rights. Only in this way can we implement sustainability along the supply chain systematically and in compliance with the law. Our requirements with regard to environmental and social responsibility and ethical best practices are formulated in our Supplier Code of Conduct, which we have revised to fully reflect the legal requirements of the LkSG, which came into force on January 1, 2023. It goes without saying that the statutory provisions relating to the treatment of employees, occupational health and safety and environmental protection must be complied with at all times. We also expect appropriate measures to be taken to avoid or mitigate negative impacts on people and the environment. Our suppliers, in turn, are responsible for ensuring that their subcontractors are informed about and comply with the requirements. www.blg-logistics.com/agbo
We ensure compliance with supply chain-related due diligence obligations primarily through the closely coordinated interaction of the Purchasing, Legal, Insurance & GRC, Sustainability, Integrated Management Systems and Human Resources departments. Responsibility for overarching coordination and oversight is vested in our human rights officer appointed in the reporting year, who is also head of the central Sustainability department. We are currently in the process of further anchoring the organizational processes established in 2023 in the various companies. An overview of the associated roles and procedures for compliance with the human rights and environmental due diligence obligations are set out in our LkSG manual.
Systematic management: risk analysis and supplier evaluation
We identify any human rights or environmental risks along our supply and subcontracting chains using systematic risk analyses as the basis for defining and prioritizing prevention and remedial measures. Responsibility for performing the risk analysis for direct suppliers lies with the Purchasing department.
Risk classification is a two-stage process, consisting of an abstract and a concrete supplier evaluation. The former – abstract risk analysis – more specifically includes the assessment of industry- and country-specific risks based on core supplier data, with the aim of identifying high- and medium-risk suppliers. These are then prioritized and examined in more detail in the subsequent concrete risk analysis, for example by verifying external certifications, requesting a self-declaration or carrying out audits. Further information about risk analysis at BLG LOGISTICS is provided in the Risk Management section.
In 2023, the risk analysis was initially carried out in the form described above for all centrally managed suppliers. The result of the abstract risk analysis was that less than one percent of our suppliers have a medium level of risk. No high-risk suppliers were identified. The medium-risk suppliers were examined in more detail and the risks identified were further deprioritized based on existing certifications or the type and scope of their business activities. In 2024, we intend to further develop the risk analysis for direct suppliers. To this end, a software-supported risk tool was tendered out in the reporting year, which is to be rolled out successively across the Group.
Detailed information on our supply chain management in general and the risk analysis in particular can be found in our reporting relating to the German Supply Chain Due Diligence Act.
Independent of the processes described above, we have additionally been evaluating suppliers and service providers in cooperation with the responsible locations according to a defined scheme since 2016. Using a comprehensive questionnaire, we assess not only traditional purchasing criteria relating to quality, price and delivery time, but also such criteria as environmental protection. The selection criteria also increasingly focus on energy efficiency, which is a key aspect for example when procuring lighting systems or forklift trucks. In addition, face-to-face meetings and on-site visits are an integral part of our dialog with main and new suppliers.
The process is completed without further action if there are no complaints, which applied to all evaluations in the reporting year. If, on the other hand, we identify a need for change or optimization, we work with the supplier to define steps for in-house or active development. We terminate relationships with suppliers that are unable to meet our requirements even in the medium term.