Sustainable Supply Chain Management
Laws and regulations on labor standards, safety, and environment have been strengthened, while stakeholders demand for sustainable supply chain as a result of unethical issues such as forced labor and child labor that occur across the business supply chain as well as safety and environmental accidents. To manage business risks and fulfill social responsibility across the overall value chain, Amorepacific Group strives to enhance the sustainability of its strategic suppliers. To this end, the Group established sustainability management guidelines for suppliers to assess sustainability management and offers improvement measures and support to suppliers with inadequacy.
Sustainability Management Guidelines for Amorepacific Group Suppliers
Sustainability Management guidelines for Amorepacific Group’s suppliers are required by Amorepacific Group’s suppliers to build a safe working environment for Amorepacific Group suppliers and respect their workers and fulfill their responsibilities for eco-friendly and ethical business management. This guideline defines the requirements that companies are responsible for all Amorepacific Group suppliers.
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Supporting Supplier Sustainability Enhancement
Amorepacific is building a sustainable supply chain by improving supply chain competitiveness.
We conduct annual education on ESG understanding and on-site management practices for suppliers. In 2023, we provided guidance, education, and certification cost support for interested major suppliers to obtain recycled packaging material certification. We also supported the purchase of safety equipment such as helmets, safety shoes, dust masks, and hearing protection devices for major suppliers in need as part of supplier safety infrastructure support. Furthermore, we pursue mutual growth by supporting environmental and safety consulting when improvements are needed to help suppliers reduce potential ESG risks.
Supplier Sustainability Management
Suppliers Selection Policy
Amorepacific Group conducts business transactions only with those that satisfy our minimum sustainability requirements at the point of business contract. The Group conducts sustainability assessment of all new suppliers, reviewing compliance with legal requirements regarding quality, product safety, labor standards, safety and health, and environment, by which the Group decides whether to enter a contract. In addition, Amorepacific Group requires all suppliers to comply with Amorepacific Group’s Code of Ethics and Supplier Sustainability Management Guidelines, when signing contracts.
Sustainability Management Assessment of Suppliers
Amorepacific Group has established, and requires all suppliers to comply with, the Supplier Sustainability Management Guidelines, which set out 36 items on human rights and labor, health and safety, environmental protection, ethical management, and other areas that need to be considered in order to fulfill social responsibilities. The group also prepared a manual on how to practice the guidelines, disclosing it to all suppliers.
Supplier Sustainability Assessment
Amorepacific Group, especially, conducts annual sustainability assessment of key suppliers and suppliers with certain transaction volume, and reflects the results in supplier assessment. Based on the assessment results, the Group offers incentives such as giving priority in receiving support for shared growth programs or in allocating quantity of goods supplied. It requests improvements to any supplier with severe social or environmental risks identified and continues to monitor and review the results and progress of improvement measures.
| Category | 2021 ~ 2023 |
|---|---|
| Share of new suppliers that have received sustainability assessment (%) | 100 |
| Percentage of core suppliers that underwent sustainability assessments in the past three years (%) | 100 |