Sustainability is incorporated in sourcing
SSAB has a Supplier Sustainability Policy based on the UN Global Compact principles to which SSAB is a signatory. The purpose of the policy is to ensure that SSAB collaborates with suppliers who share our sustainability values. The Supplier Sustainability Policy applies to all suppliers providing products and/or services to any SSAB group company and includes requirements on labor and human rights, health and safety, anti-corruption and the environment. Regarding the policy, SSAB also reserves the right to conduct reviews of our direct suppliers or onsite audits to ensure compliance with the policy. All new or updated contracts from 2017 and onward refer to the Supplier Sustainability Policy or similar, and the same reference is included in our purchase orders, for all main SSAB sites.
Identification and evaluation of supplier risks
SSAB classifies first-tier suppliers and assesses potential risks. For sustainability assessments, we use Verisk Maplecroft´s risk indices for human rights, political and environmental risks per specific region. Corruption assessments are based on Transparency International´s Corruption Perceptions index.
Suppliers identified as medium- or high-risk suppliers must complete a self-assessment questionnaire containing questions about governance, social conditions and environmental performance. SSAB investigates and follows up on identified areas of non-compliance. In 2020, 96% (93%) of SSAB’s total spend was sustainability assessed (classified/identified in terms of sustainability risks and self-assessment done) and 93% of new suppliers were screened using social criteria.
Site visits and audits
The year 2020 was characterized by restrictions in traveling and possibilities to perform onsite visits due to Covid-19. This meant that a majority of the 2020 onsite visits and audits were performed remotely.
In 2020, SSAB conducted 16 onsite visits and 3 extensive audits to suppliers related to sustainability matters. Evaluation is based on SSAB’s Sustainable Supplier Policy and conducted by a procurement commodity manager, an internal SSAB auditor or a third-party auditor. Suppliers selected for onsite visits and third-party audits are identified in the annual audit plan, and based on a number of criteria, including a pre-evaluation of the supplier’s social and environmental risk profile, taking into consideration geographical location, product category and spend volume.
This year’s onsite visits were conducted at suppliers located in Europe and North America covering different categories including raw materials, maintenance and production related material. The main improvement areas identified were linked to work environment and safety.
SSAB also conducted three third-party sustainability audits during the year – one in Kazakhstan, one in Ukraine and a follow-up audit in Brazil. SSAB works with a leading audit company to conduct the audits. The audits revealed non-conformances primarily related to safety, work environment and governance. SSAB follows up with the respective suppliers regarding these observations. In the follow-up audit in Brazil, most of the earlier deviations could be closed.
Monitoring raw material traders
SSAB also sources alloys, coal and refractories through agents and traders. SSAB requires these suppliers to monitor their sources for sustainability commitment and we have an adapted assessment process by which these suppliers must declare how they monitor social and environmental compliance in their supply chain.
HSEQ cluster for joint evaluations of contractors
SSAB is member of an HSEQ (health, safety, environment and quality) cluster for common evaluations of contractors. Several of SSAB´s contractors working on SSAB´s sites are audited annually by a third party through this cluster. In 2020, 5 HSEQ evaluations of contractors were conducted in Sweden and Finland. Also, this is an activity that Covid-19 has restricted.
Actions against modern slavery
SSAB supports and respects internationally proclaimed human rights and has taken a variety of actions to verify the absence of child labor, forced labor, slavery and human trafficking in our supply chain. These actions include sustainability principles for our suppliers, sustainability risk assessments, onsite visits and audits, and training of our employees.
No conflict minerals in SSAB’s steel
“Conflict minerals” is a term used for minerals derived from conflict-ridden regions or countries where the mining of certain minerals risks contributing to, or financing, continued conflict and violation of human rights. SSAB does not use conflict minerals (including gold, tin, tungsten and tantalum) and, upon request, provides customers with a certificate affirming this.