Responsibility in the supply chain

Our business segments cover a large part of their value chain themselves, and thereby ensure the highest quality standards. Beyond that, we work with suppliers and other business partners worldwide to care for our patients.

We expect our suppliers and business partners to commit to ethical standards of conduct in their daily business with employees, the society, and the environment. This also includes areas described in our human rights statement.

We specify and communicate our expectations toward suppliers, service providers, and other partners. Fresenius Medical Care has enshrined its expectations in Sustainability Principles1, which are part of Fresenius Medical Care’s standard operating procedures of the GMQS procurement function and in the strategic procurement departments in EMEA, Latin America and Asia-Pacific. At Fresenius Kabi 2, Fresenius Vamed, and Fresenius SE & Co. KGaA, these expectations are set out in the respective Codes of Conduct for business partners and suppliers. Fresenius Helios defines its expectations for suppliers in their respective contracts. In the business segments, both the Sustainability Principles or the Supplier Codes of Conduct are used in procurement contracts, included as attachments or included as a link to the website. With this, we want to achieve that our partners ­commit to our standards of conduct. Responsibility for selecting and contracting suppliers lies with the functions in the business segments, such as procurement. They are supported in this by measures of the Compliance Management Systems, such as Business Partner Due Diligence or reporting mechanisms for possible misconduct.

We expect our partners in the supply chain to implement adequate processes that are suitable for ensuring compliance with relevant standards. If we suspect potential misconduct, we react accordingly, depending on the severity of the misconduct, e. g., with additional control measures.

In addition, Fresenius Kabi has identified strategic suppliers, which are under special supervision due to their ­business significance; this is managed by the global strategic procurement organization. Based on defined processes, a risk-based classification of strategic suppliers is carried out first, followed by regular evaluation, which includes quality, occupational health and safety, and environmental aspects, as well as compliance. This process also includes auditing suppliers. Strategic active pharmaceutical ingredient (API) suppliers undergo an additional assessment to identify possible environmental risks and, if necessary, request the supplier to implement environmental protection measures. In addition, Fresenius Kabi has contracted an external service provider offering sustainability ratings for global supply chains to support the evaluation of suppliers. The first suppliers were invited for evaluation and rated in the categories environment, labor and human rights, ethics, and sustainable purchasing in 2019.

To further strengthen and harmonize its commitment to sustainable procurement practices, Fresenius Medical Care has launched a project to promote sustainable supply as part of a global sustainability program. The global, cross-functional working group set up in this context will focus on supplier relationship management, risk management within our supply chain, and a sustainable supply strategy.