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Sustainability initiatives

05/31/2016 - 00:00 PM

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In 2015 the implementation of the new process that defines the activities aimed at improving the Corporate Social Responsibility (CSR) of the supply chain continued with a more comprehensive system of elements used to assess the sustainability of suppliers during the stages of qualification, incoming quality and vendor rating.

Suppliers were classified according to the potential risks associated with their sustainability performance, by means of a specific method that considers the social-environmental and business continuity aspects associated with the procurement markets in which they operate. For this reason, the procurement markets (i.e. homogeneous procurement categories) have been classified in accordance with parameters such as:

  • geographical areas and risks connected with them,
  • the potential impact on the environment and on society of the suppliers' activities and of the products/services supplied throughout their entire life cycle, including risks relating to violations of human, labour and environmental rights;
  • the impact on the reputation of Telecom Italia as their customer.

A matrix has therefore been created which, by relating the spending on a given purchase market to the risk index calculated on the basis of the parameters listed, has allowed purchase markets to be divided into four classes, identifying those most critical from the point of view of sustainability and economic impact. Suppliers belonging to the classes at greatest risk are the subject of CSR audits carried out by Company personnel or by personnel from third party auditors. These audits will be repeated periodically to monitor the implementation of corrective actions and, if the results are positive, in order to verify that the standard of performance found is being maintained. The tools developed and used for the Domestic BU have been explained and transferred to TIM Brasil, which is finalising the methods of application to its suppliers.

All suppliers of the Domestic BU have been assessed to consider the social/environmental risk; in 2015, 40 were considered to be at greatest risk (-31% as compared with 2014 and + 33% on 2013). 20 purchase markets and suppliers operating in the following geographical areas are considered to be at greatest social risk: Asia, Central and South America, North Africa and Eastern Europe.

For workers in companies which supply security services in Italy, the Consolidated Law on Public Security must be complied with, in particular article 138, subsection 2 which specifies the professional and training requirements of sworn guards. In Brazil, Law 7102/83 lays down rules on private guards. Amongst others, it establishes that all those intending to be hired as guards for a guard business must have attended an advance training course, delivered by schools accredited by the Federal Police. After hiring, once every two years the guards must attend an update course.

In 2014, a self-assessment questionnaire was prepared, to be submitted during the qualification of new suppliers belonging to the highest risk purchase categories, in terms of sustainability. Suitable refresher campaigns were also delivered for suppliers previously qualified. Periodically updated based on the results and evolution of the qualification process, the questionnaire was developed according to the main requirements of the relevant responsible corporate management standards relating to respect for ethical values and to safeguarding  the environment (including SA 8000, Global Compact and ISO 14001) and to the best industry practices.

The self-assessment sustainability questionnaire is integrated into the application that handles the supplier qualification process, which automatically extended it to all new suppliers operating in markets where sustainability is considered to be at risk. Refresher campaigns were mounted for suppliers previously qualified in Telecom Italia’s Register of suppliers. The results of the questionnaire will make it possible to refine the risk matrix described above.

In 2015, a self-assessment questionnaire was sent out in Brazil on matters of sustainability to suppliers whose orders exceed one million reais, thereby involving 18% of the total number of suppliers. At end 2015, responses had been obtained from the 357 suppliers involved. The results will help direct future selection processes.

In October 2015, the ISO 9001:2008 certificate of conformity of the “Quality Management System” was confirmed for the Purchasing and Service Center Logistics Departments under the responsibility of the Business Support Office, with specific recognition for the initiatives taken in the field of sustainability. This initiative has led to the mapping of 23 department processes with the identification of 117 performance indicators that permit the monitoring and improvement of the administration of services supplied to internal clients and suppliers.

The application of the green procurement policy, which contains guidelines for establishing the environmental requirements of products/services purchased, continues to be an integral part of the procurement policy. The policy covers all stages of the product life: design, production, use and end of life. Published on the “Vendors Hub” supplier portal of Telecom Italia and in the sustainability section of the telecomitalia.com website, the document helps to orient purchasing policies towards low environmental impact products and services.

Some questions on the annual satisfaction survey (see Involvement initiatives) relate to the green procurement policy and to principles relating to human and employment rights, as well as on their implementation by suppliers, with a view to increasing their involvement in matters of sustainability.