Supplier management In addition to palm oil, shea and rapeseed, AAK processes a range of other raw materials. While AAK’s engagement in palm oil and shea is evident, the work to enhance sustainability aspects covers all the raw materials in the company’s supply chain. Until 2010, AAK operated two different supplier approval practices. Since then the company has been working to integrate them into one common practice, based on quality, food safety, environmental and ethical requirements. Today, AAK’s supplier approved process is globally based on the same principles. The Supplier Code of Conduct is a fundamental tool for assessing suppliers. In this context, AAK has decided to work within its sphere of influence, i.e. to focus on those whom AAK has the best chance of influencing – AAK’s direct raw AAK takes a holistic approach to responsible sourcing of its raw materials. What does that mean? A holistic approach, for AAK, means that we are interested in engaging and developing the entire supply chain in the large number of countries around the world from where our raw materials originate. Our approach includes responsible purchasing practices, community engagement, education, adherence to social and environmental standards as well as a strong focus on work safety and regulatory requirements. AAK will continue and further strengthen its obligation to source raw materials in a sustainable and ethical way and always with respect for people involved in our operation and supply, using our AAK Supplier Code of Conduct to secure compliance and commitment. By taking a holistic approach to responsible sourcing, we can create and secure our future as well as create value for our customers. What measurements does AAK take in order to source its raw materials with minimal environmental impact? To minimize our environmental impact is important to AAK and we seek to optimize our supply chain so that our carbon footprint is kept to a minimum. Last year we opened a new office in Singapore in order to coordinate and manage our sourcing activities and our logistics flow on a global level. By understanding and engaging in the local markets in which we operate, we will be able to source our raw materials closer to origin while we at the same time discover new opportunities 16 in the marketplace and establish innovative sourcing solutions. materials suppliers. Still, by urging suppliers to positively influence their suppliers, AAK aims to broaden the company’s sphere of influence and inspire other players in the supply chain to act responsibly. What commitments does AAK make to ensure no deforestation? AAK strives to do business with honest and committed palm oil suppliers who manage their production in an environmental and sustainable manner and in accordance with our AAK palm oil policy and our AAK Supplier Code of Conduct. Deforestation is one of the key concerns related to palm oil production and we are very committed to ensure no deforestation in our supply chain. Traceability to mill for sourcing of palm oil and associated products, including palm kernel oil, is a means to assess if a supplier works in accordance with AAK’s palm oil policy. In parallel with the work on establishing traceability, we have, together with Proforest, implemented risk assessment and mill verification programs. Risk assessment is necessary for us to prioritize efforts and to identify those origins where there is a significant risk of policy non-compliance. Torben Friis Lange President Asia ” Minimal impact on the environment
AAK - Sustainability Report 2014/2015
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