The TfS e-learning platform holds more than 240 courses in seven languages ©Getty Images
The TfS e-learning platform holds more than 240 courses in seven languages ©Getty Images

Why training suppliers helps increase compliance

When supplier audits reveal failings, training is the route to best practice 

“For 10 years we collected results, but we didn’t help create competency,” says Astrid Bosten, senior sustainability manager purchasing at chemicals company Henkel, and member of the working group Together for Sustainability (TfS). In a scenario familiar to many organisations, TfS recognised there was a crucial gap in the process of engaging with suppliers on sustainability, because once policies are in place and audits completed, what do you actually do when you encounter areas of non-compliance?

“We came back to suppliers year after year, saying now we will assess your performance again. But we didn’t help to translate the gaps that we identified, the corrective actions, into activities, projects or measures. And this is where the TfS Academy comes in.”

TfS is a collective of 33 member organisations in the chemicals industry. It acts as a community for CPOs and senior leadership to share knowledge on practices that support responsible methods, with the overarching goal of making the entire chemicals industry more sustainable, in accordance with the United Nations Global Compact. Although it faces the same disruption factors as other industries, Bosten says chemicals supply chains can be more complex and difficult to change.

“In chemical supply chains we have many partners involved before a final product is developed, and this is the biggest challenge,” she tells SM. “Take the traceability or transparency perspective, we may have up to nine tiers in one supply chain and you want to engage with all tiers and partners.

“If you look at specific commodities – let’s say conflict minerals or palm oil as the focus material – in the chemical industry, often it’s a derivative that ends up in the supply chain, not the raw material or commodity. As such, only minor elements come into the supply chain. So the responsibility remains the same but it’s the complexity that makes it very hard to comply with expectations and legal and regulation demands.”

The value of education 

For the past decade, the group has sought to streamline the industry’s supply chains, which has included managing joint supplier assessments and audits. Though a simple concept, the single supplier questionnaire has a raft of benefits, from defining a definitive set of questions by which to benchmark all organisations and so better compare them, to making it more appealing and easier for smaller companies to engage by not depleting their time and resources in the process – they can provide the information once instead of multiple times. Plus, once a supplier is assessed and categorised, they may choose they want to improve upon this ranking. But how to do that? 

In March, the group launched the TfS Academy, a free educational resource for its members in the industry but, most importantly, selected suppliers as well. “What we are sharing is the knowledge; capability opportunities with our buyers in the TfS member companies, but also with the suppliers, to provide the respective knowledge necessary to improve on sustainability performance. From different conversations, one thing that’s so important is not only having your own community to weigh everything against, but bringing suppliers into that community as well, so you know you will be having the same conversation.

“We brought buyers and suppliers into the TfS Academy at the same time because they need to be equally knowledgeable. The key competency of a buyer is not sustainability, and the key competency of the supplier is not sustainability, so they need to find a common language. And we need to equip our buyers with the tools to speak knowledgeably and confidently about sustainability with suppliers. 

“But suppliers need to understand this language and say, ‘I know what you’re talking about when you speak about product carbon footprint.’ It only works with collaboration.”

Constructive action on audit fails

The academy’s e-learning platform holds more than 240 courses on common topics of sustainable practices specific to the chemicals industry – including water and waste management, protecting biodiversity, preventing forced labour, and embedding sustainability standards in procurement processes – plus various case studies. They are available in seven languages to make it easier to support international suppliers and pitched at different job roles and seniority levels to ensure relevance and growth of knowledge across the board. 

Access isn’t a free for all as only certain suppliers are invited to join, but the system helps to close the gap in the audit process and enable more organisations to meet required improvements and contribute to the industry’s sustainability goals. 

“If a supplier has a corrective action in an audit or assessment it translates into a learning opportunity. The supplier can go to the TfS Academy and if you have a corrective action or improvement area in the health and safety space, you can upskill yourself on health and safety issues,” Bosten explains. “Once you upscale yourself accordingly, when we then come back to assess the supplier, hopefully they have already improved their knowledge and the situation.”

Together for sustainability

Working groups are emerging the world over, including specialist platforms to target knowledge and experience sharing on ESG issues as well as addressing industry or region-specific challenges. And while collaboration among competitors is helping to drive progress, bringing suppliers into this forum will only serve to accelerate efforts.

In addition to collective audits and training, TfS also connects with suppliers to explain the reasoning behind these requirements and expectations. This has proven especially useful in China, where for several years, Bosten says, TfS has held regular meetings and webinars with firms, including a more recent event when 300 Chinese suppliers attended a TfS training session – not solely for the skills, but to understand why sustainability is important to the member companies. The reality is that responsible sourcing may not be a priority for some suppliers or if it is, they may not know why their region’s regulations don’t meet all requirements. Therefore, sharing purpose is equally as important as practical guidelines.

“In our conversations with suppliers we have asked to conduct an audit or assessment, they are quite interested in the topic, even if they haven’t invested much into sustainability. But often what we see in the academy is not a lack of interest but a lack of knowledge,” Bosten concludes. “It’s crucial to equip our supply chain partners with the right knowledge and tools to enable them to progress in the sustainable sourcing journey.” 

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