Procurement for mutual good

At Nationwide, we’re committed to building a more inclusive, more ethical, and greener supply chain. In 2020, we formalised our Procurement for Mutual Good programme. This was so we could go further in embedding environmental and social considerations into our procurement policies and processes. And improve our performance over time.

We completed a desktop-based materiality assessment to understand which sustainable themes we should prioritise based on what’s important to our organisation, our industry, and the procurement profession. As a result, we selected:

• climate change
• circular economy
• modern slavery
• prompt payment
• real living wages
• social enterprise
• supply chain diversity

Our Responsible Business team within Business Services created a plan to uplift these themes within our procurement processes, and to initiate activities to baseline and improve our performance.

Each of our priorities supports a Mutual Good Commitment. We’ll take you through the details of this below.

We're working with Carbon Intelligence to calculate our upstream scope 3 emissions, including those for our purchased goods and services. And we’re identifying carbon hotspots for prioritisation. We’re also driving decarbonisation across our supply chain, working with our third party suppliers to measure, report and set targets that reduce their greenhouse gas emissions. This is a requirement for all the large third party suppliers – those with more than 250 employees – and is part of our onboarding process.

You can read more about this in the Screening supplier sustainability performance section below. Decarbonisation of the supply chain is further championed through our partnership with EcoVadis, which you can also read about further down this page.

We’re aware that worldwide we consume more resources than are naturally regenerated. And where possible we look for opportunities to reduce, reuse, recycle and upcycle across our supply chain. Examples include:

• Using some recycled materials in colleague uniforms
• Working with partners to repair, resell and recycle unwanted IT hardware
• Setting up a cleaning product refill station and buying in bulk to cut down on single-use plastics

We’ve been working with anti-slavery charity Unseen (opens in a new window) to better understand the risks that exist within our supply chain and how to take action to mitigate them, for example through enhanced due diligence and colleague training.

Further information can be found in our modern slavery and human trafficking statement.

Paying our third party suppliers promptly supports their cashflow and ensures that they can, in turn, pay their workers on time. We’re signatories to the UK Prompt Payment Code and aim to make our payments in line with its requirements.

We’re members of the Buy Social Corporate Challenge (opens in a new window), a group of businesses committed to collectively spending £1 billion with social enterprises. 

As a socially driven business, it’s important to us that we support other organisations founded with a social mission. Our social enterprise relationships include:

• Change Please
• Ethstat
• Hey Girls
• Nemi Teas
• Social Enterprise UK
• Scottish Braille Press

We’re proud to have joined the Minority Supplier Development Network (MSDUK) in early 2022. We look forward to working with MSDUK to connect with ethnic minority businesses, and to review our processes to further support supply chain diversity.

What we buy and who we buy it from matters. Which is why it’s so important to us that our approximately 1000 third party suppliers reflect our values and ambitions. We expect our suppliers to comply with our Third Party Code of Practice – PDF, 1MB (opens in a new window) and the standards it sets out. 

We also have internal Responsible Purchasing Principles, which we encourage our Procurement team and any colleague involved in third party processes to consider.

We take our responsibility to promote an ethical supply chain seriously. At the point of registration, all prospective suppliers are asked whether they:

• Agree to comply with our Third Party Code of Practice, and if not, which requirements they cannot meet
• Publish a compliant statement under the UK Modern Slavery Act each year
• Monitor their greenhouse gas emissions and have a target to reduce them (required for large suppliers only)

At this point, we also collect information on whether the company has any certifications, diverse supplier status or is a micro, small or medium enterprise.

If a supplier answers our pre-onboarding questions negatively, we investigate the responses and negotiate a plan to close any gaps before they can work with us. Only where certain circumstances apply will a dispensation be granted by our senior procurement team.

We have a standard Ethical Trading clause which is part of template agreements and covers compliance with the requirements set out in our Third Party Code of Practice. Sometimes, additional sustainability schedules are added to contracts to go further in holding suppliers to certain standards or to close gaps in performance within an agreed timeframe.

For tenders, we have a template set of sustainability questions that are designed to positively score best practices. They cover topics such as EcoVadis performance, science-based targets, signatory to initiatives, sustainability governance and training, and actions to provide a more inclusive, more ethical, and greener service.

In 2021 we partnered with supplier sustainability rating provider, EcoVadis, to help us screen and monitor third party performance across environment, labour and human rights, ethics, and sustainable procurement activities.

As of April 2023, we have over 140 third party EcoVadis scorecards, representing around 70% of our total annual spend with suppliers. At the time of review, the average overall score across our third parties was 59.6, 14.4 points higher than the average score across the entire EcoVadis network.

We regularly engage colleagues with supplier-related responsibilities on our Procurement for Mutual Good programme. Since the start of 2021 we’ve run:

• Responsible Purchasing training available to all colleagues through our interactive learning platform
• A circularity workshop with Business in the Community for key colleagues in Procurement and Property Services
• Anti-slavery training with Unseen for our entire Procurement and Property Services teams
• Training on EcoVadis for key Procurement and relationship management colleagues across the Society

Senior leaders shared updates on our Society strategy, including our Mutual Good Commitments and Procurement for Mutual Good programme, at our Annual Partner Event in both 2020/21 and 2021/2022. We ran a webcast attended by over 60 suppliers on our partnership with EcoVadis, as well as a workshop on addressing modern slavery for key third parties supporting our Property Services team.

We monitor our performance against our annual Procurement for Mutual Good plan within our Procurement team scorecard. Our Chief Procurement Officer is accountable for this.