Sustainable supply chains

ASSESSING LOGISTICS SERVICE PROVIDERS

Logistics service providers (LSPs) are critical to our sustainable supply chain. Assessments help to ensure high standards and spread best practices. As expectations around sustainability evolve, these assessments help LSPs to measure performance and understand client requirements.

Every LSP we work with must comply with SABIC’s Supplier Code of Conduct.

SAFETY AND QUALITY ASSESSMENT SYSTEM

SABIC utilizes the Safety and Quality Assessment System (SQAS) to assess LSP performance gaps and areas for improvement.

The most recent SQAS enhancements include robust criteria for sustainability and corporate social responsibility. This year, we incorporated Operation Clean Sweep®, requiring LSPs to reduce plastic waste.

We adapted the scheme to create the Gulf SQAS (G-SQAS) for Middle East countries, which includes corporate social responsibility, employee welfare, and fire risk.

This year, 93 percent of our carriers have been assessed, exceeding our target of 91 percent.

CHEMICAL DISTRIBUTION INSTITUTE

SABIC uses the Chemical Distribution Institute (CDI) scheme to ensure that maritime logistics service providers meet industry expectations for safety, security, and quality in chemical transportation and storage. SABIC’s participation in CDI helps to manage risks.

The Terminal Inspection Report, now in its sixth edition, includes a “voluntary self-inspection sustainability addendum” (SUS-SID), which enables terminal operators to supply more detail about their sustainability.

In December this year, CDI introduced a new, web-based platform that enables terminal operators to upload the SUS-SID to their current assessment, in real time and upon request.

SABIC encourages maritime LSPs to make the voluntary self-inspection.

CHEMICAL ROAD TRANSPORT SAFETY ASSESSMENT SYSTEM

SABIC transitioned to the Chemical Road Transport Safety System (CRSAS) to manage the quality, safety, security, and environmental performance of road freight carriers in China.

This year, the CRSAS system was upgraded to both Chinese and English, focusing on labor, human rights, fair competition, ethics, green transportation, and sustainable development. By August, 26 companies had signed up as shippers and 166 as carriers.

SUPPLY CHAIN INCIDENT REPORTING

We use our Supply Chain Incident Reporting KPI to measure safety performance. Our ambitious target is either a 10 percent improvement over the average of the past three years or a 10 percent improvement over the previous year’s target, whichever is lower.

This year, two traffic accidents caused us to miss our incident reduction target. We took corrective and preventative measures, and shared lessons learned. We are also evaluating our training programs.

The accidents reminded us that safety is no guarantee – despite continuous improvement.