22 Economy Procurement practices We make every effort to choose suppliers who share our environmental and social values and maintain high ethical standards. This lays the foundation for long-term, sustainable procurement relationships. We fully acknowledge the obligation on companies to do business sustainably and demonstrate social responsibility (CSR – Corporate Social Responsibility). This encompasses taking a responsible approach to people and nature, observing and complying with international legislation on human rights and working standards and fighting corruption. We enforce this by asking suppliers to sign our Code of Conduct for Suppliers and our environmental requirements. In the last reporting period we noted that two A-suppliers in Canada and Germany had not yet signed our Code of Conduct. The two companies are now no longer among our suppliers: the Canadian supplier because we have shifted the relevant parts procurement to Germany and the second one, in Germany, because of changed requirements. Apart from one new supplier in Germany, the Girsberger Code of Conduct has been signed by all our A-suppliers and most of our B-suppliers. Since more than 90% of the possible environmental impact of our products occurs during the phases before the parts and components reach our own production sites, selecting the right suppliers is of vital importance. In this way we can minimise any negative social and environmental impact. Most of the products that we procure are processed at our production sites in Bützberg/ Switzerland and Endingen/Germany. In the interest of optimising quality and costs, we give preference to manufacturers and raw materials suppliers who are based within a radius of 600 km of our production sites. So, 86.6% of all our materials are sourced from Germany, Italy, Slovenia and Switzerland, 7.4% from other European countries and just 6.0% from Asia and North America. This means that we can largely be confident that the materials we buy comply with our requirements in terms of human rights and environmental standards. This is of great importance to us, because we do not have the capacity to carry out regular checks on sustainability and compliance at all our suppliers’ sites. In the light of the integration and growth of our latest production site in Kraljevci, Serbia, new suppliers have come under consideration for our supply chain. The process includes asking suppliers to sign the Code of Conduct, evaluating the volume of goods supplied – as a result of which they will be classified as A-, B- or C-suppliers for the 2023 financial year – and assessing the supplier on their environmental and social criteria. For 2022, Girsberger again put itself forward for EcoVadis certification and was awarded the EcoVadis silver medal for its overall efforts to be sustainable in the areas of the environment, labour and human rights, ethics and sustainable procurement. This award puts us among the top 8% of furniture-making companies around the world that were assessed and certified by EcoVadis, while in the individual “Sustainable Procurement” category we are in the top 3% for the sector. Girsberger’s supply chains are, and will continue to be, affected by factors on the energy and raw materials markets, logistics issues and global events. The pandemic years of 2021 and 2022 hit our supply chains hard, especially because of the challenges on the raw materials markets and the general shortage of resources. Even though there were signs of a gradual easing of the situation in 2022, the outbreak of war in Ukraine and the resulting energy crisis in Europe put supply chains under further pressure. The prices for natural gas and electricity have reached an unprecedented high due to the war in Ukraine and the resulting energy crisis in Europe. This hit us hard as a production company because both energy sources – natural gas and electricity – are vitally important in our supply chain. The processing of plastic granules into injection-moulded parts and, especially, the smelting of aluminium die-cast alloys are very energy-intensive and the rise in energy prices increased our costs substantially. It has also been striking Supplier assessment according to social and environmental criteria
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