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. We provide 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 ESG Assessment
and Follow-up Measures
Amorepacific works only with suppliers that meet its minimum sustainability standards upon contract signing, identifies top-performing suppliers, and assesses potential ESG risks across its supplier base. Each year, based on comprehensive supplier evaluations, Amorepacific provides incentives to top performers, including priority access to partnership programs, preferential allocation of order volumes, and formal recognition through awards.
Amorepacific regularly conducts ESG assessments for major suppliers, particularly those with significant transaction volumes, and reflects the results as 10% of the overall supplier evaluation score. Suppliers that consistently receive ratings below the acceptable threshold may be subject to follow-up actions, such as reduced or restricted transactions.
Supplier ESG Evaluation Process
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Preparation for Assessment
Update assessment indicators
Identify target suppliers for assessment
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Document-Based Assessment
Conduct self-assessment via online platform
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Review Results & Identify High-Risk Suppliers
Classify high-risk suppliers based on assessment responses and select candidates for on-site assessment
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On-Site ESG Risk Assessment
Conduct on-site assessment and verification for high-risk suppliers
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Follow-Up Measures
Share assessment results and request corrective actions
Provide ESG Management Guidelines to suppliers