In 2011, Barclays spent £8.7bn with suppliers in 40 countries. This level of purchasing power brings with it a certain number of risks, but it also gives us the opportunity to exercise a positive influence on our supply chain.
We are working in active partnership with our suppliers to help them manage their own social and environmental risks, particularly those firms who have more significant impacts than we do and those in developing countries, where the regulatory framework is sometimes not as stringent as Barclays standards.
We are also committed to treating our suppliers with respect, especially in areas such as contract terms and conditions and payment terms. We are a signatory to the UK Prompt Payment Code which commits us to paying suppliers on time and encourages best practice.
Governance and approach
Barclays Chief Procurement Officer has overall responsibility for the sustainability of our supply chain, and there is a specialist team which implements our policy on a day-to-day basis.
We continue to adopt a risk-based approach to managing our supply chain’s sustainability impacts. We conduct an initial risk assessment of all new suppliers, requiring them to complete a questionnaire which covers all aspects of the proposed business relationship and includes a section on sustainability. This allows us to determine whether the supplier, or its products and services, present a high level of risk in commercial, social, environmental or ethical terms. All suppliers assessed to be ‘high risk’ have specific requirements to address these risks included in their contracts with Barclays.
High-risk suppliers are also subject to a rolling three-year audit cycle and are required to complete a self-certification process every year to ensure compliance. In 2011, we established a Controls Assurance Utility consisting of a group of our own in-house field auditors who will manage these on-site supplier audits in future. The results are written up into a Supplier Controls Assurance Plan, which includes details of any improvements we consider necessary, with a timeline for their implementation. In 2012, we will be developing a new Supplier Code of Conduct which will enable us to reach a higher proportion of our supply chain.