"We can achieve more in sustainability by working together with our suppliers"
At Neste, we select our renewable raw material suppliers carefully. Once we onboard our suppliers after a series of sustainability audits, it is just the beginning of our journey to work with our suppliers to enhance their sustainability performance. We take this opportunity to interview Michael Chong, Senior Sustainability Manager in Asia Pacific at Neste to share with us how we engage our suppliers in the region.
Michael, in your opinion, what is Neste’s unique way of engaging our suppliers to enhance their sustainability performance in the Asia Pacific region?
I would highlight the multi-tiered approach we have built for engaging our suppliers to enhance their sustainability performance.
In order to become a supplier at Neste, all our suppliers need to meet Neste’s sustainability requirements. However, we do not stop there. At Neste, we believe that by working together with our suppliers to further strengthen their sustainability performance, we can achieve a more sustainable future.
Based on this vision, leading the way towards a sustainable future together, we take a multi-tiered approach for engaging our suppliers. We, for example, support our suppliers to enhance their sustainability management systems, including sustainability policies, due diligence, grievance mechanisms and many more. For those who have already developed their management system, we will support them on the implementation of the management system with tools and platforms.
Can you share a few concrete examples on how Neste supports its suppliers to enhance their sustainability performances?
I want to highlight two examples here.
First, we have developed different tools and platforms to support our suppliers to strengthen their sustainability performance. We were one of the first downstream companies in the world to fully disclose our palm oil supply chain on our website in April 2016. In 2017, we launched a Traceability Dashboard website introducing all companies, mills, and estates in our supply chain. This was further updated and supplemented with supply chain data of palm fatty acid distillate (PFAD), a residue from the palm oil production process in 2018, after which we have provided continuous updates to this data. In 2020, we further enhanced the system by providing updates to the information of Neste’s supply chain not once, but twice a year.
Secondly, we have been organizing annual face-to-face supplier engagement workshops in the Asia Pacific region since 2015 to foster dialogue with our suppliers on sustainability related topics. During these workshops, we also get an opportunity to hear about our suppliers’ concerns, and to exchange successes and lessons learned. The topics of these workshops have ranged from human rights and labor rights to deforestation and supply chain traceability. We believe that close engagement and collaboration with our raw material suppliers provides us the best opportunity to support the development of sustainability and proactive mitigation of risks within our supply chains and even beyond.
(image was taken pre-Covid)
What is the impact of COVID-19 to Neste’s engagement with its suppliers?
We used to have regular face-to-face supplier meetings across the region, including the annual supplier engagement workshop. But due to the COVID-19 pandemic, physical interactions had to stop. However, it does not stop our daily efforts of engaging with our suppliers.
Instead of organizing the annual in-person engagement workshop, we organized a series of online webinars in April 2020 for four consecutive weeks with four different topics. We switched from face-to-face supplier meetings to virtual video and conference calls. For me personally, it is important to always remember to devote some time for informal conversations at the beginning of these virtual calls. I always ask everyone how they are doing and coping. During the COVID-19 times and when the local advisories allow, I also meet with our suppliers face-to-face, while following strict safety measures.
What will be Neste’s focus on in its supplier engagements in the coming years?
We see a lot of value in collaboration in supply chains, partnering with various actors and leveraging on each other’s strengths. On top of improving Neste and our suppliers’ sustainability performances, we also aim to expand our collaborations, and identify ways to engage the local communities where Neste and our suppliers are present, especially in the initiatives that promote conservation, rehabilitation/restoration, biodiversity and tackling social issues.
Personally, what have you gained by working on suppliers’ engagement in sustainability performance?
It is a rewarding journey of engaging with our suppliers to support them to enhance their sustainability performance. I have been witnessing many suppliers who take the extra mile to enhance their sustainability performance, sometimes even further than the local regulations require. I’ve also learned a lot from our suppliers during this engagement process, as well. I feel that I am doing something that is more than just a job.