Telecoms rivals audit shared suppliers jointly

6 July 2011

6 July 2011 | Adam Leach

Deutsche Telekom, the parent company of T-Mobile, has teamed up with competitors France Telecom-Orange and Telecom Italia to increase the number of supplier audits.

The three companies entered into a Joint Auditing Cooperation (JAC), which enabled them to audit 18 shared suppliers in 2010. This pushed Deutsche Telekom’s total number of supplier audits to 24 compared with a previous yearly average of between four and six vendors.

Deutsche Telekom’s 2010/2011 Corporate Responsibilityreport revealed that through the JAC the companies plan to conduct 34 social audits of shared suppliers. A total of 18 audits were done last year and the remaining 16 are scheduled for 2011.

The companies are also developing standardised social and environmental criteria, which all suppliers must meet.

While Deutsche Telekom failed to meet its target of 50 audits in 2010, it has reiterated its aim of appraising 200 suppliers between 2010 and 2012, both through the JAC and independent checks.

Under the company’s social audit process, which is focused on suppliers in Asia, a general risk assessment, evaluation of self-assessment forms and a meeting is conducted with each supplier. High-risk suppliers are then identified and earmarked for a full audit by an external audit firm. The partnership will shortly include audits of high-risk providers in Latin America.

The report said: “This collaboration is unique in the industry. The companies agreed to engage in a joint procedure to improve the sustainability of their supply chains in Asia. In October 2010, this decision resulted in a binding agreement, the JAC. We are planning to expand our cooperation with France Telecom-Orange and Telecom Italia. Our next step will be to develop joint measures as part of JAC to improve supply chain transparency in 2011.”

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