Supply chain management
Swire Properties requires service providers to perform well in the areas of health and safety, the environment, procurement, management and quality. New suppliers must complete self-assessment questionnaires to confirm that they have appropriate policies and systems in place to comply with the supplier code of conduct. Due diligence is performed to verify the responses and sites in Hong Kong and the Chinese mainland may be visited. Independent certification in accordance with internationally recognised standards, and the submission of environmental and health and safety management plans, may be requested for internal review. In 2020, Swire Properties assessed the compliance of over 300 Tier-1 suppliers (representing over half of its 2020 procurement expenditure) with the supplier code of conduct. None were considered high risk.
The compliance by Swire Coca-Cola’s suppliers of critical materials and ingredients for beverages, packaging and any items with TCCC’s logo with TCCC’s Supplier Guiding Principles is audited by third parties. Knowledge is shared with other Coca-Cola bottlers in the Chinese mainland in order to manage procurement better. This facilitates the identification and selection of suppliers who follow appropriate procurement principles.
Cathay Pacific requires all suppliers to declare that their products and services comply with the code of conduct. It evaluates suppliers using a scorecard which measures performance in six different areas: cost, innovation, satisfaction, quality, assurance of supply and sustainability.
Cathay Pacific Catering Services has stringent procedures for supplier selection and ingredient procurement. It conducts regular audits of its food suppliers’ food safety systems.
HAECO Group identifies its critical suppliers based on volume and asks them to complete self-assessment surveys. It assesses their compliance with its requirements and engages with them on the basis of their responses. This is done every two years. Critical supplier audits are carried out periodically when necessary.
Swire Properties tracks consumption of office supplies, building services equipment and building materials which have been certified or accredited by independent third parties. The data is used to evaluate its sustainable procurement performance and to identify opportunities for sourcing more sustainable products. In 2020, HK$1,196 million of sustainable products were procured.
Swire Properties specified low-carbon concrete, rebars and structural steel in the contract for a new development in Hong Kong. It procures Forest Stewardship Council (FSC) certified and Program for the Endorsement of Forest Certification (PEFC) certified timber and rebars and structural steel with recycled content for its Two Taikoo Place development.
Swire Coca-Cola has committed that by 2025 key agricultural ingredients will come from sources verified by third parties to be sustainable. It estimates the carbon emissions associated with its packaging. A tracking system, introduced in 2020, helps identify improvement areas and communicating its decarbonisation strategy to suppliers.
In 2020, Cathay Pacific Catering Services purchased 58 tonnes of sustainable seafood, representing around 55% of its total seafood purchases. It purchases peanuts produced from palm oil certified to be sustainable, and hydroponic vegetables grown in Hong Kong.