Supplier Code of Conduct
Our focus on responsible procurement is underpinned by our Supplier Code of Conduct to which all of our suppliers – and their respective suppliers – are required to agree to as part of their onboarding. Accordingly, they are expected to comply with:
- Labor regulations — adherence to regulations against child labor, forced labor, violence and discrimination, as per the ILO fundamental conventions;
- Working conditions — provision of decent working conditions that include reasonable working hours, fair wages and benefits, and freedom of association; and
- Health & Safety — ensuring the protection of workers' health and safety, providing training and information on hazards as well as emergency preparedness arrangements.
- Environment — regulatory compliance, mitigating climate change, minimizing environmental releases, reducing of energy and water usage and protecting biodiversity.
The Supplier Code of Conduct is incorporated into our electronic ordering systems and is also referenced in both the global procurement policy and global procurement operating standard. During onboarding, suppliers must acknowledge and agree to comply with our Supplier Code of Conduct.
Supplier Selection and Onboarding
Suppliers participating to Sanofi tenders need to go through a compulsory sustainability assessment, encompassing the following dimensions: social responsibility, environmental policies, CO2 emissions and product/service traceability. This assessment contributes to up to 20% of suppliers’ score card in the tender award process. If a supplier does not have measures against forced labor, child labor and discrimination, it cannot be selected.
If a supplier is selected and has a sustainability score below average, corrective action plans need to be integrated into the contract and implemented within one year.
As part of their onboarding process, suppliers considered as risky from a sustainability standpoint are systematically requested to complete a dedicated third-party assessment.
Supplier Risk Mapping
Sustainability risks are assessed through our 267 procurement sub-categories. The categories are assessed based on their inherent risk in terms of health and safety, the environment and human rights. Inherent risk is determined regardless of the country of operation, as follows:
- health & safety — number of people affected and severity of consequences;
- environment — extent of the negative consequences (pollution, use of natural resources), communities and biodiversity (whether or not limited to the site), and their irreversibility; and
- human rights — workforce characteristics (qualification level, number, temporary or permanent status) and sector-specific labor rights risks. Sustainability Statement
An internal compound rating, found in the subcategory risk matrix, identifies 47 procurement subcategories as high-risk. Specific management practices are applied to suppliers in these 47 subcategories based on their classification through audits or third-party risk assessments.
Supplier Assessment
We have established a risk-based approach, focusing assessments on the high-risk categories identified in the subcategory risk matrix defined above. Our buyers and risk experts can also recommend ad hoc assessments based on the information captured in the general questionnaire during onboarding.
The assessment must be completed upon supplier onboarding and renewed at least every three years. This assessment covers the following areas:
- environment
- labor practices and human rights
- fair business practices
- responsible supply chain
Suppliers with poor performance are requested to implement corrective action plans. In case of significant and/or non-remediated deviations, Procurement may decide to conduct on-site audits or terminate the relationship.
In 2024, 865 suppliers have been assessed on their sustainability performance. Of these, 830 were reassessed, 39% of which improved their rating after executing an action plan. Overall, 89% of the assessed suppliers met our sustainability requirements.
Supplier Audits
Supplier audits, focusing primarily on Health, Safety and Environment (HSE) performance, are conducted by our HSE Department or subcontracted to external auditors.
In 2024, we focused on essential and antibiotics suppliers, continuing audits of high-risk API providers and contract manufacturing organizations.
Out of the 103 suppliers ranked critical in 2020, 39% have since improved their performance, 39% have been subject to business termination and 22% are still under re-audits and CAPA.
References
- Includes PSCI shared audits