Supply chain

Responsible supply chain management is critical to mitigating financial risk, maintaining business continuity, and protecting our reputation. It is integral to protecting and empowering workers in our supply chain and helping to ensure the sustainable availability of natural resources.

We source from thousands of suppliers in countries across the globe. They provide goods and services including aircraft parts, fuel, food products, packaging materials, cleaning services, office supplies, and uniforms.

We advocate inclusive, ethical and sustainable procurement practices. We aim to source all key materials responsibly and sustainably, in a way that does not degrade nature and ensures that the people who produce them are treated with dignity and respect. This is what our investors, those with whom we do business, and the communities in which we operate expect. Consumers are demanding responsible products and looking for supply chain transparency.

Property Property

Beverages Beverages

Aviation Aviation

Trading & Industrial Trading & Industrial

We do not have a central procurement function. Each operating company is responsible for its own procurement. However, we have policies and guidelines that set out the Group’s expectations of suppliers.

All staff involved in making procurement decisions must adhere to the Swire Pacific Sustainable Procurement Policy in conjunction with the respective procurement policies of each operating company, the Swire Pacific Supplier Code of Conduct, and the Swire Pacific Human Rights Policy.

Sustainable Procurement Policy

Our Sustainable Procurement Policy references the sustainable procurement guidance in ISO 20400:2017. It requires our operating companies to establish a process to identify potential sustainability risks in their supply chains and develop a segmented approach to managing suppliers based on those risks.

Under the policy our operating companies should integrate the SwireTHRIVE principles and other material sustainability considerations into supplier selection and retention. Preference should be given to suppliers that have ISO-certified management systems in place, and that can significantly contribute to helping the company achieve its sustainable development objectives. Preference should be given to products which do not adversely affect the environment and that can help us reduce our environmental impact.

Supplier Code of Conduct

Our Supplier Code of Conduct (SCoC) sets out the Group’s requirements for responsible sourcing. It applies to all suppliers and contractors of all Group subsidiaries, associated and joint venture companies. Suppliers are expected to cascade the SCoC’s requirements to their own suppliers, such that they apply to multiple tiers in our supply chain.

The SCoC is based on the International Labour Organisation (ILO) Declaration on Fundamental Principles and Rights at Work and the Ethical Trading Initiative (ETI) Base Code. It requires regulatory compliance, prohibits forced or child labour, and sets out our expectations on health and safety, environmental issues, compensation and working hours, human rights, subcontractor management, and ethics and reporting.

We monitor and assess compliance with the code and other sustainability performance criteria. Where gaps are identified, we may require suppliers to undergo audits and to develop and adopt appropriate corrective action plans to ensure compliance, with a focus on those deemed high risk.

Human Rights Policy

Our Human Rights Policy is informed by the International Bill of Human Rights and by the International Labour Organisation’s Declaration on Fundamental Principles and Rights at Work. We comply with national laws where they conflict with human rights standards but still do our best to respect the latter. We seek to include, in our agreements with suppliers and contractors, provisions which encourage them to adhere to the principles in our policy.

Our Sustainable Supply Chain working group convenes senior procurement managers from our operating companies to share best practices and develops sustainability policies and guidelines for suppliers.

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 2021, Swire Properties assessed the compliance of over 300 Tier-1 suppliers (representing over half of its 2021 procurement expenditure) with the supplier code of conduct. None were considered high risk. No incidents of human rights violations were identified.

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.

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.

Sustainable materials

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 2021, HK$946 million of sustainable products were procured, representing 12% of its total 2021 procurement spend in Hong Kong and the Chinese Mainland.

Swire Properties specified low-carbon concrete, reinforcement bar (rebar) and structural steel in the contract for a new development in Hong Kong. It is working with Tsinghua University to explore the availability of low-carbon building materials in the Chinese Mainland. Swire Properties tracks the consumption and environmental impacts of specific construction materials such as timber, concrete and rebar, which enables benchmarking across its new developments. It aims to promote greater innovation and availability of low-carbon building materials by sharing its experience with primary contractors and building material suppliers through publications, presentations at conferences and other methods.

Swire Coca-Cola has committed that by 2025 key agricultural ingredients (sugar and corn) 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 communicate its decarbonisation strategy to suppliers.

HAECO is developing sourcing policies for key materials such as plastic, fuel and gas to provide procurement and buying teams with guidance to make more responsible choices.

For more information on our operating companies’ approaches to sustainable procurement, please refer to their 2022 sustainability reports.

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