We offer our customers tailored, sophisticated logistics solutions along global supply chains. Exactly what this looks like and the scope of our services is described in detail in the Company Profile section. In addition, we take over the entire supply chain and establish integrated logistics chains that we manage across the entire value creation process – especially in the areas of project and process management, technology, IT and quality. We mainly work with products and components provided by our customers.
We take our responsibility seriously and strive to ensure that our direct suppliers comply with due diligence when it comes to human rights and the environment. This requirement was further strengthened by the Supply Chain Due Diligence Act (LkSG) entering into force in 2023.
Our centrally-managed purchasing processes comprise more than 100 product groups and are managed by the Corporate Purchasing Department. In addition, purchasing activities also take place directly at the sites. This results in a diverse portfolio of suppliers from different industries to help us provide our services. 99 percent of our procurement markets are located in Germany as well as in other European countries, where binding sustainability standards apply.
Clear communication for common standards
We are transparent with our customers about how we meet our ethical, social and environmental responsibilities. We also expect this openness from our suppliers and take appropriate criteria into account when selecting and awarding contracts. For example, when subcontracting transport services, we pay particular attention to sector-specific risks relating to human rights, such as adequate wages, the right to freedom of association and compliance with general occupational health and safety rights. Only in this way can we systematically implement sustainability along the whole supply chain in compliance with the law.
Our requirements for environmental and social responsibility as well as ethical business conduct are set out in the Supplier Code of Conduct, which we recently revised in line with the LkSG, which has been in force since 2023. Of course, all legal requirements regarding employees, occupational health and safety and environmental protection must be complied with at all times. In addition, we expect that potential or actual negative impacts on people and the environment will be prevented or mitigated through appropriate measures. Our suppliers are obligated to inform any subcontractors about our requirements and to ensure that they comply with them.
www.blg-logistics.com/en/gtc
We ensure compliance with supply chain-related due diligence primarily by means of closely coordinated interaction between the Purchasing, Legal, Insurance & GRC, Sustainability and Human Resources departments. The overarching coordination and monitoring are primarily the responsibilities of our Human Rights Officer, who is also Head of the Corporate Sustainability Department. In the reporting year, the Human Rights Officer was supported by the appointment of two Human Rights Coordinators for companies with more than 1,000 employees.
In addition, the organizational processes and responsibilities for fulfilling LkSG due diligence have been further refined. Together with the Human Rights Officer and Human Rights Coordinators, the corporate departments set the framework for the performance and implementation of due diligence in the various company departments. In addition, they regularly report to the Human Rights Officer on the planned and implemented measures. The operational sites are responsible for implementing supply chain management in their own area of activity.
Our LkSG manual provides an overview of the respective roles and processes for compliance with human rights and environmental due diligence obligations.
Clear processes: risk analysis and supplier assessment
We identify and assess potential risks relating to human rights or the environment along our supply and activity chains using systematic risk analyses. These analyses serve as a basis for defining and prioritizing preventative measures and remedial measures. Purchasing is responsible for carrying out risk analyses with regard to our direct suppliers.
Risk classification is a two-stage process, comprising an abstract and a specific supplier assessment. The first focuses on the assessment of industry and country-specific risks based on supplier data, with data-based software being used for the first time in the reporting year. The objective of this abstract risk analysis is to identify suppliers with a risk that is potentially increased. In the subsequent specific risk analysis, these suppliers are prioritized and examined more closely on an individual basis – for example, by considering the type and scope of the business relationship, reviewing external certifications, requesting a self-assessment or conducting audits. Further information on risk analysis at BLG LOGISTICS can be found in the Risk Management section.
In the reporting year, the risk analysis was carried out in the form described above for all our suppliers in 2023 and the first half of 2024. The result of the abstract risk analysis showed that less than 1 percent of our suppliers are potentially high risk. In the next step, these suppliers were checked in detail according to the defined process. In all cases, the potential risk could either be plausibly reduced by way of a specific analysis of the previous abstract risk assessments or else the cooperation with the suppliers concerned had already ended at the time of the analysis or could be discontinued in the near future.
We have been assessing suppliers and service providers in Central Purchasing in cooperation with the responsible sites according to a defined scheme since 2016. Using a comprehensive questionnaire, we assess not only classic purchasing criteria such as quality, price and delivery time, but also environmental aspects. A particular focus is on energy efficiency, which plays a central role in the procurement of lighting or forklifts, for example. In addition, face-to-face discussions and on-site visits are an integral part of our dialog with existing and new suppliers.
The process is deemed to be completed when there are no objections, which was the case for all assessments in the reporting year. If changes or optimization are required, we agree with the supplier on measures to be taken for further development. We terminate relationships with suppliers who cannot meet our requirements, even in the medium term.