Supplier Management

In 2015/16, CSL Behring maintained vigilance in critical supplier management across the business, with new initiatives for engineering equipment suppliers and a review of the business technology critical suppliers, given the changes in operational landscape. In manufacturing operations, the global sourcing team continued to closely monitor suppliers' risk profiles through the Global Risk Management Framework, and modify mitigation actions where required. These include qualification of alternative suppliers, maintaining safety stock and rigorous supplier relationship and performance management.

Relationships with CSL's critical suppliers are governed in accordance with the Critical Supplier Management Standard Operating Procedure. This procedure stipulates that, for each critical supplier, CSL will assign a Relationship Manager and Executive Sponsor, who will meet with the supplier at least annually to discuss a range of topics including current performance and future plans.

As capacity expansion projects mature and our manufacturing network becomes more globally interconnected, CSL is working with its suppliers to ensure continuity of supply and to proactively mitigate any risks associated with increased demand.

In 2015/16, a global cross-functional team was established to align supplier assessment and qualification activities relating to performance against CSL's Code of Responsible Business Practice (CRBP); environment, health and safety matters; and quality audits. In addition, a key objective of the team is to develop a consistent supplier quality oversight platform for the entire end-to-end business process of quality supplier management, with full implementation anticipated for 2017. The team has commenced development of harmonised questionnaires and will implement a streamlined process, leveraging best-in-class systems and tools, in 2016/17.

Furthermore, over the reporting period, CSL refreshed its global watch-list of essential products. This activity, which includes information on patient population size and inventory levels, allows CSL to mitigate the likelihood of critical shortages.

In 2015/16, CSL conducted 584 quality audits of our suppliers across CSL Behring, CSL Plasma and Seqirus. This level of effort reflects our continued focus on understanding our suppliers as they relate to CSL's business relationship and overall compliance-related performance.

The prevention of human trafficking, slavery and forced labour (modern slavery)

Over the reporting year, CSL undertook a number of steps to prevent and mitigate modern slavery in our direct operations (for more on actions taken see page Human Rights) and in our supply chain.

Our supply chain
  • CSL commenced a pilot program to assess suppliers across a number of environmental, social and governance (ESG) – related aspects including modern slavery.
  • To enable the pilot and assist with the selection of suppliers, CSL commissioned an independent desktop risk screen of the likely inherent risks of modern slavery and related poor labour practices in the main countries of our suppliers.
  • An ESG-based questionnaire was developed for the pilot to assess alignment against CSL's own commitments and expectations.
  • Based on outcomes of the risk screen, the questionnaire was issued to a sample of raw-material/manufacturing equipment suppliers, and also providers of cleaning services in countries where CSL holds key operations. CSL will assess responses and the effectiveness of the pilot in 2016/17.
  • Over the reporting period, all (52) sourcing and procurement personnel across the organisation with decisionmaking authority undertook e-learning training on Protecting Human Rights in the Supply Chain.

A Board-approved copy of CSL's Statement on the Prevention of Human Trafficking, Slavery and Forced Labour (Modern Slavery) can be found on our website.