We depend on more than 20,000 suppliers to support our business. Poor performance or unethical conduct by a supplier could affect our reputation or our ability to operate effectively. That’s why we aim to build relationships with suppliers who share our values. Our contracts set out our expectation for all suppliers to comply with our Code of Conduct or equivalent standards on ethical business conduct, compliance, safety, environmental management and human rights.
Monitoring supplier standards
Our procurement teams assess suppliers on a range of ethical, labour, safety, human rights and environmental standards during the selection process and as part of our ongoing assurance activities.
For major suppliers, we conduct an extensive due diligence process (see factsheet ), including site visits if needed and supplier self-assessments, to ensure standards are consistent with our expectations. If we identify any potential concerns, additional screening is necessary before we can proceed.
We continue to engage with major suppliers at all stages of the project lifecycle from planning through to completion. This through-life approach supports our efforts to promote a more sustainable supply chain. We also encourage suppliers to reduce environmental impacts by implementing best practices.
To ensure lasting relationships with our suppliers, we aim to encourage innovation and flexibility, provide opportunities to access new business, share best practices and pay suppliers promptly. In 2018, we reconfirmed our commitment to the enhanced UK Government Prompt Payment Code and were one of teh inaugural signatories to the Australian Small Business Supplier Payment Code.
We foster skills and invest in innovation throughout our supply chain , and ensure supplier intellectual property is protected. We work constructively with our suppliers and we aim to remove barriers to trade, especially for small and medium enterprises (SMEs). We invite our suppliers to join our CIPS Aerospace & Defence academy training programme (Procurement Developing You).
For innovation, we engage our suppliers through our technology and supply chain leads. Examples include:
- Partnerships and collaborative programme funded by industry and government institutions such as the MoD Technology Strategy Board.
- Company investment programmes such as the Corporate Technology Programme and Commercialisation initiatives which work with, and have funded, over 50 technologically innovative SMEs, embracing the innovative SMEs, embracing the concept of Open Innovation to access and mature future capability for our business.
- Supporting the Supply Chain through a variety of initiatives to encourage and enable communication with suppliers and provide them with awareness of BAE Systems Technology Conferences which support our engagement with the wider research and technology supply chain.
- BAE Systems host a variety of events to encourage engagement with suppliers. An example of this was our Innovations Live technology conference focused on autonomous systems, predictive maintenance and the changing cyber landscape. We invited new and existing SMEs to present component technologies in the accompanying exhibition. Targeted industry days also provide an opportunity for SMEs to meet-the-buyer in relations to specific project and technology requirements.
We are committed to paying suppliers promptly and in accordance with agreed terms.