Supplier sustainability compliance

Our suppliers must follow the legal requirements and the internal rules and standards applicable to OMV. Our Code of Conduct stipulates that suppliers must support OMV’s Principles. This mitigates supply chain risks, such as forced labor, slavery, human trafficking, and corruption. Suppliers are obliged to comply fully with the content of the Code of Conduct, and all supply chain partners are required to sign the Code of Conduct.

Tools such as evaluations and audits assess and monitor supplier compliance with the principles outlined in OMV’s Code of Conduct.

Since 2017, OMV has conducted assessments at selected strategic suppliers in the areas of Environmental, Social, and Governance (ESG) performance. During the ESG assessment of suppliers, OMV also inquires about carbon targets and environmental programs (potentially including GHG reduction). For 2019, we performed 6 ESG assessments. Most of the suppliers assessed met our requirements. Further areas for optimization and improvement were identified and agreed upon.

OMV also conducts supplier audits that include sustainability elements. For instance, one of the elements covered in the audits relates to environmental management and certification, including energy management and therefore the impact of a supplier activity on GHG emissions. Other HSSE topics and business ethics, social responsibility, and human rights are also covered.

OMV has established a strategic target for conducting supplier audits with sustainability elements. In 2019, we performed 11 audits with sustainability topics covered.

Furthermore, we perform yearly subject-specific audits on topics such as process safety, quality, and efficiency. In 2019, we completed 85% of the targeted audit plan, with 66% of the audits resulting in follow-up measures. By the end of 2019, 63% of the suppliers that were identified as needing to implement follow-up measures had completed more than 75% of the respective measures. The others will be completed according to an agreed plan in 2020.

Corporate and legal HSSE requirements are communicated to potential suppliers at the tender stage. OMV assesses the HSSE risks of potential suppliers and ranks them in the OMV Risk Matrix. For suppliers who present a potential risk to OMV, we conduct a more in-depth analysis of compliance in line with OMV’s Contractor HSSE Management Standard. Crude transportation partners are subjected to an additional assessment against the TMSA (Tanker Management and Self-Assessment) Standard, as OMV is a member of the OCIMF (Oil Companies International Marine Forum).

Supplier risk assessments are conducted on an annual basis and verifications are done on suppliers’ HSSE performance based on inspections and audits of monitored KPIs. Final evaluations, including HSSE and social responsibility performance, are communicated to the Procurement department by the parties conducting the evaluations for further contractual management actions. OMV reserves the right to terminate relationships with suppliers if non-compliance with applicable policies is discovered or non-compliance is not addressed in a timely manner. OMV has a process in place aimed at ensuring that parties sanctioned by the EU or international organizations, such as the United Nations, are not accepted as procurement partners.

We also provide a reverse engagement channel to our suppliers, whereby suppliers can use our Community Grievance Mechanism to communicate any concerns related to OMV activities in their local area. (For more information on the Community Grievance Mechanism, see Community Relations and Development.)

1 Suppliers in scope for this target are active suppliers (at least one purchase order in the past year) who meet certain criteria such as procurement spend and strategic fit.