Abengoa is committed to the quality of its products and services. It is essential, therefore, for the company to be able to rely on suppliers who are aware of company expectations and able to adapt to the needs of the business through a relationship of trust and mutual benefit, for they represent the source of this commitment to quality.

Abengoa integrates its suppliers directly into the development of company operations by applying their expertise and technology. The implementation of the best solutions proposed by its suppliers enables Abengoa to minimize risks and optimize costs and schedules.

Supplier performance is key to efficiency in producing high-quality products and services, lowering costs and increasing profits. A structured procedure is employed in order to assess supplier effectiveness. This procedure includes compiling information and opinions from the suppliers the company evaluates.

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Five basic guidelines are in place to execute the above, setting the tone for supplier relationships and reinforcing Abengoa’s strategy: outsourcing, leadership, globalization, local development and integration.

  • Outsourcing. Outsourcing services that are tagged as complementary to production allows us to streamline operations.

Outsourcing makes it possible to concentrate on increasing knowledge and enhancing business core yield by incorporating the most professional service possible by directly involving suppliers in day-to-day operations.

Services such as a workforce specialized in different aspects of maintenance and utilities, as well as supplies and application of critical products, are outsourced in view of the specific training, technology and expertise required.

  • Leadership. The ongoing pursuit and contracting of industry-leading suppliers ensure innovative solutions geared towards enhancement, with a significant technological component, thus enabling Abengoa to maintain its competitiveness and high standards of quality.

The company turns to suppliers renowned for their success and proven expertise for the supply of critical products and maintenance of key components.

  • Globalization. Contracting common suppliers at the different production centers enables the company to incorporate the most advanced and consistent service, with standardized scopes supporting corporate procedure and balanced growth between the different production plants.

These synergies facilitate the application of global solutions ensuring cost optimization, both in management and in service development and supplies.

  • Local development. In turn, the focus on local supplier development and involvement ensures coverage of the most essential key requirements, and results in flexibility in consumption volumes and response times. All of this has a positive impact on business and industrial growth in the geographical areas involved in implementation, thereby ensuring a close relationship.
  • Integration. The integration of suppliers’ proposals for improvement enables ongoing improvements to productivity and performance.

Price-setting according to results is a basic principle of commitment to the business and the inclusion of respect for human rights and business ethics, within the policy of environmental security, complements this commitment.

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Local suppliers

Abengoa’s presence in the countries where it operates helps to create wealth by implementing and developing economic relationships with local suppliers. The table below shows the percentages of purchases made from local suppliers in the main countries where Abengoa conducts its business. Each percentage has a specific weight with respect to the group’s total purchases in 2009.

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Case Study Adhesion to the Social Responsibility Code

Since June 2008, Abengoa has been requiring its suppliers, including suppliers of raw materials, to sign a Social Responsibility Code (SRC) based on the international SA 8000 standard and consisting of 11 clauses. Through accession to this SRC, Abengoa promotes among its suppliers observation of, and compliance with, prevailing social and environmental norms, as well as compliance with all social responsibility-related aspects specified under the Global Compact, including all of the company’s productive processes. All suppliers are required to adhere to this code.

Since June 2008, Abengoa has been requiring its suppliers, including suppliers of raw materials, to sign a Social Responsibility Code (SRC) based on the international SA 8000 standard and consisting of 11 clauses. Through accession to this SRC, Abengoa promotes among its suppliers observation of, and compliance with, prevailing social and environmental norms, as well as compliance with all social responsibility-related aspects specified under the Global Compact, including all of the company’s productive processes. All suppliers are required to adhere to this code.

1. All laws and applicable regulations of the country where activities are conducted shall be observed.

2. Human rights shall be respected and no employee shall suffer harassment, physical or mental punishment, or any other kind of abuse.

3. At the very least, wages and working hours must adhere to the laws, regulations and norms to this effect in the country involved, including minimum wage, overtime, and maximum number of working hours.

4. Forced or compulsory labor shall not be used, and employees shall be free to leave their job after handing in sufficient advance notice.

5. Child labor shall not be employed, and, specifically, ILO requirements shall be met.

6. Employees’ rights to free association shall be abided by.

7. All employees shall be provided with proper conditions of occupational safety and hygiene.

8. Activities shall be carried out with respect for the environment and abiding by all pertinent law of the country concerned.

9. All products and services shall be supplied in a way that meets the criteria of quality, safety and security prescribed by the pertinent contractual terms, and shall be secured for the established purpose.

10. In securing the supply of goods and services to Abengoa companies, there shall be no use of fraudulent means, including but not limited to bribery.

11. Abengoa Suppliers and Subcontractors shall ensure that their respective suppliers and subcontractors in turn adhere to the obligations listed above.

In 2008 at least 5,299 Abengoa suppliers signed up to the SRC agreement, and in 2009, at least 7,596 agreements were signed, thereby representing a total of 12,895 agreements since this measure was implemented.

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2009 Milestones
  • 81% of supplies procured by the group over 2009 came from local suppliers in the main countries in which Abengoa operates.
  • 7,596 suppliers adhered to the Social Responsibility Code.

Abengoa committed to the quality of its products and services