Sustainable procurement: How MediaMarktSaturn wants to ensure that manufacturers comply with social and environmental standards
As the largest European trading company for consumer electronics, MediaMarktSaturn not only wants to provide its customers the best products nationwide and at all times, but also to ensure that social and ecological standards are observed in their production. An enormous challenge: the supply chains today are global and highly complex. Sustainability News shows how MediaMarktSaturn and IMTRON are successfully tackling these challenges.
MediaMarktSaturn's product range includes branded products from well-known manufacturers as well as products from its own brand company IMTRON. IMTRON GmbH is a wholly-owned subsidiary of the MediaMarktSaturn Retail Group, which is responsible for the procurement of the own brands ok., PEAQ, KOENIC, TechnoStar and ISY. Long and complex supply chains are behind both third-party and own brands. Potentially dangerous risks for people and the environment are hidden here. These risks must be avoided and reduced and the value chains must be made more socially and ecologically sustainable - from ensuring humane working conditions in production to protect the environment, climate and resources.
But no company can accomplish this major task alone. This is why MediaMarktSaturn relies on partnerships with organizations, suppliers and business partners to improve sustainability standards in the supply chain. The Group has joined forces with other companies in the electronics industry to form the Responsible Business Alliance (RBA, formerly: Electronic Industry Citizenship Coalition EICC).
What's the RBA?
The RBA (until October 2017: EICC) is a worldwide association of leading electronics manufacturers and retailers who are committed to uniform social, environmental and ethical standards for the supply chain as part of a Code of Conduct. The aim is to improve supplier management in the industry on a long-term basis. The MediaMarktSaturn Retail Group joined the organization in 2016.
MediaMarktSaturn goes one step further by issuing its own purchasing guidelines. This is an overarching framework that is binding for all purchasing organizations in the Group. It creates binding and transparent minimum standards for all purchasing activities and defines responsibilities, processes and documentation requirements for all employees.
In addition, the MediaMarktSaturn Retail Group has committed itself to the Federal Government's National Action Plan for Human Rights (NAP) and published its Human Rights Policy in December 2018. It supports the goals of the NAP for the protection of human rights and already fulfills them on a voluntary basis.
The standard for private labels is significantly higher
As a manufacturer of the own brands ok, KOENIC, PEAQ, ISY and TechnoStar, IMTRON has an even more direct responsibility. In addition to the MediaMarktSaturn purchasing guideline, IMTRON has therefore issued its own purchasing guideline: it regulates all purchasing processes and minimum requirements for all products and merchandise-related services. All responsibilities, process and documentation requirements are laid down in detail to ensure a high degree of transparency in purchasing processes.
BSCI membership drives continuous improvement
Since 2014 IMTRON has been a member of the amfori Business Social Compliance Initiative (amfori BSCI), which was founded to protect employee rights in production facilities. The principles of the amfori BSCI include the active management of health and safety at the workplace, a general ban on child and forced labour and environmental protection.
The BSCI is oriented towards these international social standards.
The amfori BSCI Code of Conduct is based on the SA8000 standard of the organisation Social Accountability International (SAI), the universal human rights declarations of the United Nations, the UN Global Compact, the core labour standards of the International Labour Organization (ILO) and the OECD guidelines.
The BSCI principles are summarized in a so-called "Code of Conduct", which is binding for all IMTRON suppliers as an integral part of the supplier contracts. The success record: all IMTRON suppliers have signed this Code of Conduct and thus committed themselves to comply with it.
Regular audits ensure compliance with standards
The membership in amfori BSCI obliges IMTRON to carry out regular audits of its suppliers. A successful BSCI audit is considered to be the performance of a supplier with the grade A, B, C or D.
The development of long-term business relationships with suppliers is in IMTRON's own interest. Because the conditions in the manufacturing countries can only be improved through continuous cooperation and step-by-step. If a supplier receives an audit grade of D ("Insufficient"), this means that the company has passed the audit but needs support to improve. Here IMTRON provides active support and develops measures together with the supplier to improve the results. The achieved progress will be reviewed in a timely manner as part of a re-audit.
The IMTRON Purchasing Guideline also regulates how to deal with suppliers who fail their audit. In extremely rare cases, a zero tolerance protocol applies: The supplier concerned is temporarily banned and asked to comment immediately. Measures are then agreed to remedy the deficiencies. Only when the problems have been resolved and a successful re-audit has been carried out is the supplier's suspension lifted again. This procedure also motivates hesitant suppliers to quickly remedy unacceptable situations.
With a two-person Sustainability Management team in Germany and a trained auditor on site in Hong Kong, IMTRON also has a strong personnel base. Together with the suppliers, they work on continuous improvements. Successfully!
The professional and committed supplier management at IMTRON and MediaMarktSaturn is beginning to pay off. Amfori BSCI has now become the overarching standard. Audits are the norm today. Everyone in the supply chain knows their duties. Through many small steps, continuous improvements take place. The most impressive proof: an increasing number of audits passed!