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Suppliers' Sustainability
We are committed to conducting business with the highest ethical standards, and we expect the same of our suppliers. At the same time, we also see opportunities to generate shared value through sustainability.
As we advance on our sustainability journey, we believe partnering with our suppliers will play an important role in our ability to generate significant positive impacts beyond our own operations.
Throughout the majority of 2019, advancing sustainability in our supply chain was focused on integrating sustainability criteria as part of our supplier qualification process and audits. The audit criteria included elements that are fundamental to general risks associated with supply chain management as well as to our core sustainability interests such as health, safety, environmental protection, human rights, ethics, business continuity and quality.
Over the course of the year, we audited 12% of the total number of our critical suppliers. Through this audit program, our target was to evaluate at least half of our critical suppliers. While this was a beneficial first step in our approach to addressing sustainability in our supply chain, we recognized an opportunity to ensure our efforts will be optimal in efficiency and efficacy as part of the new Global Business Services function. Our goal is to engage our suppliers through collaborative solutions that benefit our shared sustainability performance without causing an undue burden on our partners.
Collaborating with suppliers in China to cut plastic waste
In our effort to avoid unnecessary disposal of bags used to package our product, our team in Brazil has been partnering with a supplier to develop a radio-frequency identification (RFID) tag that could help track the movement of these bags.
This would allow us to improve the percentage of bags returned for reuse and coordinate with customers accordingly. Currently, approximately 65% of bags are returned to Cabot from our customers, and we anticipate this rate to increase to about 80% with the use of RFIDs. This system will also help us monitor the condition of bags being reused and enhance our ability to track packages throughout their distribution.
Collaborating with suppliers in China to cut plastic waste
Our team in China has been developing a leasing program for our plastic pallets.
Instead of selecting standard single-use pallets for key customers in China, we coordinated with our partners both upstream and downstream in our logistics supply chain to identify a better solution. The alternative allows for pallets to be sent back to the nearest network point for redistribution to Cabot and our partners, enabling a savings of approximately 85 metric tons of plastic per year.
