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Suppliers

We work with many different suppliers across the Group and are committed to acting fairly and honestly in all our dealings with them.

We work with thousands of suppliers. Our choice of suppliers, and the way we deal with them, not only reflects the values we have as a company but also determines how strong and mutually beneficial our supplier relationships are, both now and in the future. The relationships we develop secure us high quality, reliable and costeffective products and services; and the business we bring to our suppliers assists their growth and development.

To further improve our procurement, in 2009 we integrated it into our new Responsible Business Policy. As part of this, we made a commitment to strengthen our relationships with suppliers. A number of our business units have been developing ways to consider social and environmental impacts in their procurement decisions, and are working with suppliers to help them understand these issues. In South Africa, where we are the largest financial services business, the country's Black Economic Empowerment (BEE) strategy has a material impact on our business: in 2009 we continued working to ensure that the economic benefits and opportunities we generate are spread equitably across South African society.

So what were the main developments in our supplier relationships and activities during 2009

Developing stronger relationships with suppliers

Our reputation is one of our most important assets and the relationships we build with our suppliers contribute directly to that reputation. Our Code of Business Conduct, in combination with the commitments to suppliers outlined in the new Responsible Business Policy, sets clear standards. The implementation of procurement policy is managed by procurement teams at local level and we work with all our suppliers to help them meet our requirements. In 2010 we will be reviewing how procurement is monitored within each business unit.

As part of our work to strengthen relationships throughout our supply chain, our business units run regular supplier forums to share best practice and seek feedback. During 2009 we started to look at ways in which we can stimulate greater feedback from our supply chain. Old Mutual South Africa (OMSA), for example, has a Procurement Council to provide a feedback channel, tracking progress over time through monitoring and auditing.

Greening the supply chain

Where practical, we consider the environmental impacts of our suppliers' activities in our procurement decisions; and we work with suppliers to raise their awareness and understanding of these impacts and improve their performance.

Nedbank and Skandia Nordic are showing leadership in this area, and plans are in place to share their best practice with the rest of the Group in 2010. At Nedbank, for example, we have focused particularly on suppliers with the largest environmental impact and have moved to electronic invoicing where possible.

Improving black economic empowerment in South Africa

In all our business relationships in South Africa, across Old Mutual South Africa, Nedbank, and Mutual & Federal we aim to ensure that we act within the spirit of the BEE strategy, as well as in line with the letter of the law. This includes our relationships with our suppliers.

Where possible we practise affirmative procurement by sourcing goods and services from:

  • All suppliers based on their BEE Procurement Recognition Level;
  • Blackowned small and medium enterprises (including microenterprises);
  • Black women owned suppliers.

Nedbank, for example, has a dedicated BEE Procurement Management Unit. This sets the framework rules for BEE procurement, in line with the Nedbank Procurement Policy, and engages with all parts of the business in achieving BEE goals and targets.

At OMSA, the Transformation Committee and Procurement Council receive quarterly reports on all aspects of procurement. Through the Procurement Council we are working closely with Masisizane (a nonprofit organisation set up by Old Mutual to support national economic transformation) and with the business units to establish BEE supplier accreditation and supplier development frameworks.