Ferrovial - Annual Report 2012

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Supply Chain

Supply chain

Ferrovial considers its supply chain an essential stakeholder in the development of its business. Both sides seek mutual benefit by joining forces in order to offer customers higher quality services, while guaranteeing compliance with the Principles of the Global Compact and respect for the environment.

Ferrovial aims to establish long-term relations with its suppliers as far as possible. It encourages greater communication and collaboration with its suppliers and subcontractors.

In 2012 a procedure was introduced to establish the criteria for classifying suppliers and identifying those of high risk according to Corporate Responsibility criteria. It is based on the Principles of the Global Compact, Ferrovial's Corporate Responsibility Policy, and the FTSE4Good Supply Chain standards.

Supply Chain2012 20112010Var 11-10
Number of suppliers*  57,458 61,354 60,911 -6%
Suppliers evaluated  8,402 8,415 9,876 0.15%
Suppliers rejected  773 685 735 13%
Supplier incidents 508 607 303 -18%

*T his figure has been obtained by using country-specific revenue data, so there are suppliers that have been counted more than once, although the impact of this is very limited.

Profile of Ferrovial suppliers

In 2012 Ferrovial had dealings with 57,458 suppliers, including not only suppliers, but also leasers and subcontractors. It is worth highlighting the fact that most Ferrovial suppliers belong to OECD countries, so they are considered low-risk in terms of Human Rights violations and compliance with labor and environmental regulations. At the same time, the sectors in which Ferrovial operates through its different divisions are related to activities in which there are no significant risks in the supply chain, according to the criteria of the aforementioned institutions.

By geographical area, 56% of all suppliers are contracted in Spain, 21% in Poland, 10% in the United Kingdom and 6% in the United States. Local suppliers represent the majority in all the markets in which Ferrovial operates.

Ferrovial's different businesses promote the use of local suppliers, and the number of local suppliers used in each country is 94% of the total on average.

However, given that the company operates worldwide, in the case of the most important purchases prices are checked internationally to take advantage of the competitiveness offered by other markets around the world.

Management of the supply chain is one of the basic aspects of Ferrovial's environmental management in some business areas, such as Construction and Services, where the level of subcontracting can be significant and the sustainability of many projects depends largely on the performance that the company can demand from suppliers and contractors.

Global Procurement Committee

A new corporate-level committee called the Global Procurement Committee, was created in 2011. Its aim is to ensure the continued coordination, monitoring and control of global procurement activity in Ferrovial, in order to:

  • Take advantage of synergies between businesses.
  • Share good practices.
  • Improve the global procurement function.
  • Increase mutual knowledge.

The committee is headed up by Ferrovial's CIO, and is composed of all the purchasing managers of the different business divisions. It is responsible for approving procedures, guides and recommendations on purchasing in the company.

A manager is appointed for each purchasing project, making it easer to identify the synergies in the group and use volume aggregation in purchasing practices, thus saving costs. The Global Procurement Committee meets every four months. It also has other objectives, such as promoting studies of Best Practices within the industry, and participating in workshops and conferences with experts.

attached files

Commitment

  • Treat the supply chain as a key factor in the company’s sustainable development strategy.

Lines of action

  • Encourage suppliers and subcontractors to adopt principles increasingly in line with the Corporate Responsibility policy.
  • Base relations with suppliers on a methodology that includes Corporate Responsibility criteria.

2012 Milestones

  • Introduced procedure to classify suppliers according to their risk in terms of Corporate Responsibility, in order to properly identify and manage high-risk suppliers in terms of these criteria.
  • Developed a Purchasing Policy and a Code of Buyers for Ferroser.
  • Launched a new Organizational Purchasing Procedure for Ferrovial Agroman, which establishes a new category of coordinated purchase management at international level. The Purchases Department must necessarily be involved in this management, regardless of the country in which the project for which the purchase is going to be made is located.

2013 Goals

  • Extend the analysis of high-risk suppliers in terms of Corporate Responsibility criteria throughout the entire company.
  • Extend Social Responsibility criteria to all incident and accident research and business activity coordination departments.

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© Copyright 2019. Ferrovial
  • Dow Jones Sustainabiliy Indexes
  • LBG Spain
  • The Global Compact
  • FTSE4Good
  • Carbon disclosure project
  • Corporate Responsibility Prime. Rated by oekom research

This is an electronic version of the 2012 Annual Report prepared by Ferrovial, S.A. for its stakeholders, which aims to be complete and accurate. The contents of this version can be checked by referring to the print version. A copy of the print version in PDF format is available to download on this web page