The importance of a sustainable supply chain policy
Articles
Legal
Governance / ESG
Trade / Logistics
Efficient and legally compliant supply chain management is crucial to a company's success.
Dr. Martin Eckert
Legal Partner
Legal standards must be observed at various levels in the supply chain:
In Switzerland, the focus is on the area of conflict minerals and child labor (CO; Swiss Criminal Code; DDTrO).
In Germany, the Supply Chain Sourcing Obligations Act (LkSG) applies with a broad scope of application;
In the EU, a directive on corporate due diligence with regard to sustainability is in the pipeline. The EU Supply Chain Directive (draft) will cover the entire value chain, i.e. up-stream and down-stream.
At the international level, there are other frameworks (not exhaustive):
Violation of due diligence requirements in the supply chain not only jeopardizes reputation but may have criminal consequences (Art. 325ter Swiss Criminal Code) and lead to rejection in public tender procedures or from awarding of public contracts (LkSG).
In order to ensure a smooth and sustainable supply chain, it is essential to define clear guidelines, strategies, processes and concrete measures that comply with legal requirements on the one hand and are individually tailored to the company and ESG risks on the other (risk-based approach). The requirements are comprehensive and include a policy statement on environmental and human rights strategy (commitment statement; code of conduct), due diligence, risk management, regular risk analyses, preventive measures, remedial measures, definition of internal responsibilities, supplier code of conduct, ESG contractual clauses, supply Chain traceability, reporting/complaint procedures, documentation and reporting requirements, etc.
To this end, MME's ESG team has developed a customizable template for a supply chain policy to comply with Swiss legal requirements and strategies on how to pragmatically deal with the rolling legislation and the various standards and regulations ("ESG jungle").
