April | Lindsay Clark
Oil firm Shell has targeted 90 per cent of its procurement spend in poorer
countries at local suppliers.
The firm’s corporatesocial responsibility report
said it spent more than $13 billion (£7.9 billion) on goods and services during
2010 in countries where the GDP was less than $15,000 (£9,170) a year per
person. Nine in every ten dollars of the procurement spend in these countries
went to local suppliers in 2010, the company reported.
“We also increased our sourcing of goods and
services in China, India and Russia where we have teams in place to assess potential
suppliers,” the report said. “Our major contracts include requirements to
follow the Shell general business principles, code of conduct and health safety
security environment standards.”
The oil company also said it had implemented
improved requirements on anti-bribery and corruption across the organisation in
2010, including strengthening the due diligence toward suppliers, contractors
and government intermediaries.
In China, India and Taiwan, Shell conducted 34
independent assessments of suppliers during 2010 to verify their compliance in
areas such as human rights, labour practices and business integrity.
The supply of biofuels has become a sensitive
issue, because of concerns that their production can damage natural habitats.
Shell said 83 per cent of the volume of biofuels
its purchased in 2010 was from suppliers signed up to contract clauses ensuring
they did not cultivate, produce or manufacture biofuels in areas rich in
biodiversity. “Suppliers must be able to trace supply chains, and they must
belong to relevant international bodies promoting sustainable biomass
production,” the report said.