Management of relationships with suppliers (G1-2) and payment practices (G1‑6)
- ESRS:
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Management of relationships with suppliersG1-2Management of relationships with suppliers
Supplier relations
In accordance with the Group’s ”Responsible Banking and Sustainability Policy”, we take care that ESG obligations are respected throughout the supply chain. The management of supplier relations is based on the ”Purchasing Policy”, the ”Supplier Cooperation and Outsourcing Policy” and numerous procedures related to supplier management. The purchasing process involves a CSR survey, which bidders participating in tender procedures are required to complete, and the results form part of the merit evaluation. In 2024, we have introduced a comprehensive supplier ESG risk assessment system at the Bank – a step towards a more complete integration of environmental, social and corporate governance criteria in supplier relationship management.
Additionally, in 2024, we developed an ”ESG Code for Suppliers” to replace the CSR survey and establish minimum standards in the areas of environmental, social, and governance practices that we expect our partners to meet. Its formal adoption is planned for Q1 2025. In other Group companies, procurement and contract management procedures include elements of social responsibility, but we are implementing the above-mentioned measures exclusively at the Bank for now.
The most important regulations related to the supply chain management of Group companies are as follows:
* Santander Leasing has regulations modelled on the Bank’s documents – these include a supplier management procedure, a supplier cooperation policy and a purchasing procedure.
We consider compliance with the principles of fair and equitable treatment, transparency and integrity in our dealings with suppliers. We expect our suppliers to implement policies on ethics and legal compliance, anti-corruption mechanisms and initiatives to ensure business integrity, health and safety standards, workplace diversity and inclusivity, as well as compliance with the UN Universal Declaration of Human Rights and the 10 principles of the UN Global Compact.
When qualifying suppliers for cooperation, the Bank verifies, among other things:
- whether they diversify their revenue streams and do not become dependent on the Bank,
- whether they have relevant certifications, e.g. on environmental protection and labour relations,
- whether they apply ESG principles, have codes of ethics, implement anti-corruption proceedings and programmes and publish reports,
- whether they operate ethically in financial matters, including paying employee contributions, taxes, and obligations to counterparties
Ultimately, we want all Group Companies to include social and environmental criteria in the supplier selection processes they carry out directly for their operations. In 2024, some of the Group Companies undertook such assessments.
Group companies incorporating sustainability criteria in their contractor selection procedure
- ESRS:
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Payment practicesG1-6Payment practices
Payment practices
In the Group, we do not have a formal, separate policy for preventing delays in payments to suppliers. Neither do we use standard payment terms – payments to suppliers are made on the basis of contractual or statutory arrangements. Instead, we have implemented procedures and regulations for the circulation and processing of accounting documents, as well as payment procedures to minimise the risk of delays. Electronic document workflow systems are in place throughout the Group to support the fast and efficient processing of invoices and other accounting documents.
Key indicators reflecting payment practices in 2024
* Data on the average time taken to pay invoices in the Group has been calculated according to a methodology in which, at Group Company level, the arithmetic average of the number of days taken to pay invoices in the reporting period is taken. At Group level, a weighted average is used, where the weight is the number of invoices paid by each entity. With this method, the indicator takes into account the diversity of suppliers and provides a representative picture of payment practices.
** Percentage indicator re. what proportion of invoices have been paid within the deadlines according to commercial agreements or arrangements with suppliers.
There are no supplier categories in the Group, so we report the indicators on payment practices together for all suppliers.
In 2024, we completed the implementation of the changes resulting from the DORA (Digital Operational Resilience Act) Regulation, the EU regulation on digital resilience of financial institutions. Throughout the implementation cycle, the project was monitored by Management Board Members within the Steering Committees and also within the banking compliance committee. The following units were involved in the project in the substantive and GAP analysis: Legal Area, Technology Risk Area, Supplier Control Team, CIO, CISO. Prior to the entry into force of the Regulation, we underwent an audit carried out by an independent audit firm on the Bank’s compliance with the Regulation. We actively participate and have participated both in the cooperation with the Banco Santander Group and within the DORA project teams at the Polish Bank Association.
