Sustainability in our supply chain

In the course of our operations, we procure a wide range of goods and services. In line with our overarching Group Sourcing Standard, we aim to select suppliers that offer the best value for money, deliver high quality and adhere to Swiss Re’s Code of Conduct.

Furthermore, as a signatory to the UN Global Compact, we are committed to observing all of its ten principles. Amongst other things, the principles prohibit any form of discrimination or the use of child or forced labour, and they require that the freedom of association and the right to collective bargaining be upheld. These principles of the UN Global Compact are referenced in our Code of Conduct and specifically cover our relationships with external service providers in the areas of human rights, labour conditions, environmental impacts and anti-corruption.

The procurement of all goods and services from external vendors is conducted in accordance with our Group Sourcing Standard, which also refers to the headings from the UN Global Compact. When selecting new products and suppliers, we examine whether they comply with these requirements as part of the overall evaluation process. We re-examine at existing strategic suppliers in our periodic contract reviews and visit individual suppliers to inspect them on site. In the context of the COVID-19 pandemic, we have partnered with our vendors to collaborate virtually. Internally, we hold awareness training sessions with our sourcing staff.

Since 2016, we have sought to further promote sustainability throughout our supply chain by taking a more proactive role. First, we needed to gain more transparency on our critical vendors’ performance regarding our standards for sustainability.

To achieve this, we started to collaborate with two external ESG assessment companies, IntegrityNext and EcoVadis. They both provide platforms covering a wide range of screening criteria across the topics of environmental impacts, human rights, labour practices, ethics and sustainable procurement. The use of key performance indicators such as these enables us to assess the sustainability performance of our vendors more systematically and to engage them in an ongoing dialogue to achieve meaningful improvements. The assessments also help us reduce and manage potential sustainability risks in our supply chain.

By the end of 2020, all our existing Tier I and Tier II vendors had completed their ESG assessment (representing 65% of an annual spend of more than USD 1 billion). As of 2021, all our newly onboarded vendors need to complete this ESG assessment during the due-diligence process. The insights we are gaining into our vendors’ sustainability performance in turn set the stage for our ESG Vendor Development Programme (VDP), a key sustainability initiative in our supply chain management that at the outset will seek to improve ESG scorecard performance.

Working closely with our suppliers is critical to achieve the targeted ESG VDP performance indicators, which is why we launched the ESG VDP as a pilot for our in-scope Legal & Compliance vendors in 2021. We plan to extend the ESG VDP to a target subset of our Tier I vendors in 2022.