Good Practice Sharing Workshop: Human rights in the supply chain
Sustainability is a fixed component of Daimler's corporate strategy and a key factor for the success of the company. Another key factor are the suppliers, who are obligated to comply with the sustainability standards of Daimler AG. Therefore, Daimler AG wants to ensure the observance of human rights along all supply chains and support corresponding controls of the suppliers: With a sustainability management that encumbers a variety of controls – one of which is the Good Practice Sharing Workshop Human Rights, which started as a pilot at the Sebes plant.
Respect for human rights is of great importance to Daimler. The Human Rights Respect System (HRRS) is a risk-based and systematic approach for respecting human rights – not only at the Group locations but also at the supplier locations. The HRRS includes the risk analysis, development of controls, control and reporting. Risk factors are analyzed with a primary focus on the country and the business model to make the issue manageable in the complex structures of direct suppliers and sub-suppliers.
Pilot events with logistics partners
In light of that, the Procurement Department has developed the Good Practice Sharing Workshop Human Rights. “With this concept, we specifically focus on material groups and on partners in countries with potentially higher risks”, explained Daimler manager Katrin Weber, who handles sustainability topics in the International Procurement Services department and who initiated the project.
As such, the first step of her planning included holding pilot events for logistics service providers in Sebes, Romania. The plant is part of the worldwide powertrain production network of Mercedes-Benz Cars and manufactures dual-clutch transmissions as well as automatic transmissions with torque converters. The two logistics companies, Kühne & Nagel and International Alexander, play an important role for the internal flow of materials and are located directly at the plant site.
Acting sustainably together
Daimler already conveys its expectations with respect to sustainability and human rights to the suppliers via the Supplier Sustainability Standards. The local procurement manager, Josef Rückert, also discovered that the personal dialog is of interest: “When we surveyed the logistics partners in July 2018, both of them immediately confirmed their participation in the Good Practice Sharing Workshop.” This cooperative attitude and readiness for taking sustainable actions together with Daimler made it possible to hold the pilot events in a timely manner – and with great success – in Sebes.
The reliable supply of the production plants has top priority. Therefore, we want to be sure that our logistics partners are observing the sustainability standards and human rights requirements without fail.
Open workshop atmosphere
The pilot workshops with Kühne & Nagel and International Alexander took place at the beginning of August 2018. Each of the workshops were attended by high-ranking members of site, logistics, project and personnel management and also the Quality, Safety and Health division. The group was rounded up by Daimler team procurement managers and human rights experts. The cooperative exchange of experiences took center stage with a tour of the supplier buildings and open talks and discussions. Katrin Weber: “This allowed us to place our expectations for sustainability and human rights topics and get to know the business environment of our partners better.”
Beyond an audit, the workshop allows for an open dialog. This strengthens the awareness of human rights and the trust between Daimler and the suppliers. A concept that is also transferable to other countries, industries and suppliers.
Good Practice Sharing
In addition to raising awareness for human rights issues, the talks also covered concrete applications, such as in the areas of Environment, Health & Safety, Discrimination & Diversity and Benefits & Additional Services. This also included an identification of exemplary practical examples, as underscored by Josef Rückert, Procurement Manager: “For example, this allowed us to identify in a review of Working Hours and Minimum Wages that our partner is not only in compliance with all regulations, but also makes positive contributions by compensating truck drivers for meals and accommodations.“
Successful concept for the future
In the future, Daimler will anchor the demand for sustainability even further within the supply chain. The two Good Practice Sharing workshops on the topic of human rights showed the extent of the suppliers’ willingness to work with Daimler to discuss issues, implement them and work on new solutions. “The events were very successful for both sides”, said Katrin Weber. “We will now utilize the experiences we gathered from the pilot phase for further workshops.”