A key aspect of our stakeholder network is our suppliers. Developing and maintaining successful business relationships with our suppliers are vital in achieving our KPIs in three areas; yield (production of FFB), production cost and Profit Before Tax (PBT).
These efforts are underpinned by guidelines of the MSPO and RSPO, which describes our commitment to respecting human rights, adhering to national laws, becoming more inclusive of smallholder farmers and increasing the traceability of our supply chain. We encourage all our suppliers to comply with these guidelines throughout their operations, including traders and their third parties.
Sustainable Procurement and Supplier Assessment
We subscribe to efficient, fair and transparent procurement practices. Since 2010, we have established an e-procurement system to process the purchase of goods and services electronically. The bottom-line benefits of having the e-procurement system in place includes cost reduction, process efficiencies, improved accountability, spending controls and compliance.
For contracts valued RM500,000.00 upwards, tenderers are required to bid via our e-bidding system which allows for a fair and transparent bidding process among our tenderers.
We have held dialogues and briefing sessions to assist our contractors and suppliers to familiarise themselves with our procurement process. In addition, during every tender site visit, the contractors and suppliers are briefed once again on the process which include training sessions on the e-bidding system.
The Group also takes cognisance on local contractors and suppliers who contribute to the local economy as well as involving sustainability practices in their operations, delivery and services.
Within this framework, we know that our suppliers are at different stages of progress towards sustainability. This means that we work with them in different ways so that, together, we can improve on our Economic, Environmental and Social (EES) impacts. In practice, this results in a combination of approaches, including proactive engagement which are aimed at improving standards and responding to challenges that are brought to our attention.
In 2018, TDM assessed seven new suppliers and contractors and 14 existing suppliers and contractors on their sustainability delivery and services, which also included human rights policies and practices.