How to evaluate supply chain risk according to ESG criteria and create an auditing process to certify suppliers.
“The flexibility that Sygris provides has allowed us to implement a module to manage the audits of our risky suppliers. With the pandemic, we were able to conduct 100% of the process remotely”.
Carmen García Rodríguez,
Head of Sustainability and Corporate Ethics at Telefónica
Supply chain risk management was a top priority for Telefónica. Why? Because this was one of the internal requirements of its strategic plans. However, the company struggled to meet this requirement due to a series of challenges:
As a large company, Telefónica operates all around the world and lacked a centralised tool to unify the various countries where it operates, its many services and volume of turnover.
Additionally, the company has a vast number of service providers and suppliers, not all complying with their ESG standards.
They lacked complete and accurate information to evaluate the risks in their supply chain.
They lacked an agile and auditable communication channel with their suppliers.
An enormously diverse and dispersed supply chain
The traceability of the information facilitated verification. The integration of the data into a single system helped to improve the efficiency of the process.
Sygris was linked to Telefónica’s procurement system, incorporating all information on company purchasing. With this data, we offered an initial analysis of ESG risks, considering the country, type of service and volume of turnover. In this way, we could identify and classify suppliers with greater inherent risk.
Based on these results, risky suppliers went through an auditing process. For this, Sygris created two types of access to the platform:
– Auditors: generating Observations, Non-conformities and Action Plans.
– Audited suppliers: to complete questionnaires, consult the results and submit the required documentation.
Using the automatic results of the audits we could identify the detailed risk level of each supplier. This allowed the company to take informed decisions about contracting and to include the results in their Integrated Report.
Sygris has enabled Telefónica to now have a global vision of their supply chain risk and to ensure they only work with suppliers who meet their ESG standards.
More agile processes. By incorporating all types of data on a single platform, we automated the steps to maintain supplier information up-to-date, permitting rapid verification and informed decision-making.
External and supplier audits are included 100% within the evaluation process, with results expressed out of 10.
Improved data quality. By compiling and cross-referencing all the information from risk assessments and audits, we have much more accurate and complete data on which to make evaluations.
Closer alignment with company strategy. Managing supply chain risk according to the internal standards of the company enables Telefónica to meet the objectives of its Strategic Plan.
Savings in development costs
Scalability of the project
Time savings in process management