The Group is a corporation involved in global business and working relationships with more than 6000 direct suppliers worldwide.We set strict social and environmental requirements for ourselves as well as our suppliers and subcontractors.

The Group’s goal is to contribute towards improving human rights, labor rights and environmental protection within the Group, in relation to our suppliers and subcontractors, and in relation to trading partners.

Environmental and social aspects shall be taken into consideration throughout the production and distribution chain, from production of raw materials to sales, and shall not be limited to the Group’s own activities.

When using external suppliers and subcontractors, it is important that we inform them of our health and safety guidelines and that we ensure that our safety routines are followed by external parties involved in our operations.

In situations involving employees with different languages and cultural backgrounds, it may be difficult to create a shared safety culture with good compliance. It is therefore important to ensure good communication to achieve full understanding of the prevailing safety routines.

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POLICY: Procurement

KPI: Supplier evaluation

Supplier Involvement

In the Group, suppliers are an integral part of our operations and we have an obligation to ensure that our suppliers act according to the Group’s governing documents. By implementing a structured and  standardized supplier management, we can verify that our suppliers adhere to our requirements and, if necessary, initiate corrective measures. As a buyer, we have an ethical responsibility to ensure that our suppliers act in accordance with relevant laws and regulations.

Suppliers, including subcontractors, are requested to adhere to the highest industry standards, and it is a prerequisite that laws and regulations are followed. With regards to food suppliers we work towards 100%  obtained food safety GFSI certification. In the Group, supplier audits are a tool for developing cooperation and  ensuring continuous improvement between the companies in the Group and our suppliers, and a requirement to assure compliance.

As one of the largest employers along the coast of Norway, the Group has local suppliers that are valuable contributors to our operations. We highly value the diversity in our supply chain and work continuously to develop a local presence near our operations.

As a responsible buyer, the Group has developed a risk-based approach to supplier management to assure that our supply chains are sustainable and robust. We are influenced by internal and external factors ranging from biodiversity to political risks, and we therefore analyze and focus on understanding those factors.

Supplier Evaluation – Supply chain risk management

The Group is a corporation involved in global business and working relationships with suppliers and subcontractors worldwide.

We have worked closely with several of our suppliers for decades. Lerøy sets requirements for all suppliers. The suppliers are informed of and familiar with our requirements.

As a Group we are aware of our responsibility to control that our suppliers are familiar with legal requirements, our code of conduct, work towards lower emissions, strategy and routines for occupational health and safety management and food safety among other criteria.

To be able to  screen all our suppliers, evaluate high risk suppliers and to take responsibility for working with continuous improvement with our suppliers, the Group has developed a supply chain management system.

In the system new suppliers are categorized and risk-assessed according to turnover, criticality and country of origin in order to identify those who carry the greatest risk regarding potential breaches . New suppliers carrying the greatest risk undergo an electronic assessment during which they have to provide a detailed explanation and description of  their:

• Governance practices
• External certifications
• IT & cybersecurity measures
• Supply chain management
• Sustainability practices
• Occupational health and safety management
• Social and environment criteria
• Relevant supplier specific assessment criteria.

Based the criteria the suppliers can obtain maximum 100 points. Based on the score the suppliers are risk categorized as  Green (Low risk), Orange (medium risk) and red (high risk)

• Red - High risk <50 points
• Orange - Medium risk 50-80 points
• Green - Low risk <80 points

New suppliers identified as high risk, not fulfilling the requirements are considered excluded or  are required to implement corrective actions according to the Lerøy Quality Management system.

In addition, Lerøy will annually make a selection of existing suppliers to be evaluated according to a special relevant topic.

On transport suppliers, Lerøy have signed an cooperate agreement with other seafood suppliers about a common audit scheme. An third party certification body will perform a physical onsite audit on transport companies evaluated high risk.

Lerøy Supply chain risk management system

• Overview  and categorization of suppliers at a corporate level
• Risk assessment and risk categorization of suppliers at a corporate level
• Screening and evaluation of suppliers

Target is to screen all new suppliers in the system using all criteria including environmental and social criteria. In 2021 all new suppliers received a request from the supplier evaluation system. The repsonse rate was 11,5 % screened using environmental and social criteria. We are working on increasing the responsrate, among other things by informing the receipients in advance so they do not believe its a spam mail

Social criteria Screened:

• Governance practices
• Occupational health and safety strategy, targets, risk assessment practices, training programs
• Fair working conditions, equal opportunities, freedom of association
• Whistleblowing practices
• Supply Chain follow-up and management practices

Environmental criteria screened:

• Sustainability strategy and targets
• Carbon footprint and carbon footprint reduction targets
• Sustainability reporting practices