Thales at DPRTE2023: Creating social value through sustainable supply chains
Thales is attending DPRTE23 to showcase how we deliver social value across the markets we serve by working in partnership with our supply chain. Through innovative partnering, our sustainable procurement approach is reducing carbon emissions. We’re investing in STEM talent that will provide the skills we need to fuel the nation’s Growth, as well as our commitment to accessing 160,000 hours of volunteering to support our local communities. You can find us on the Thales stand - 022 in the main hall, where we would welcome you to come and talk to us about how we can work together to support delivering social value together. We look forward to meeting you.
As a global business with over 7,000 employees in the UK, we’ve worked for over a century to exploit technology for the nation’s benefit. Through our activities, we’re proudly contributing towards a greener, safer, more inclusive society. This is consistent with the UK Government’s social value policy, which includes themes such as tackling economic inequality, fighting climate change, and promoting equal opportunities.
Social value has, rightly, become increasingly important in recent years and makes up at least 10% of the weighting on UK Government contracts. In this respect, Thales already has a well-developed framework for creating and delivering social value across the UK, of which our Sustainable Procurement Strategy is an essential component.
In fact, Thales Group, (which includes Thales in the UK) has a Gold rating from Ecovadis, the world leader in business sustainability ratings, which puts us in the top 5% of global companies for sustainability management.
An SME-powered supply chain
With 60-80% of UK revenues linked directly to supply chain activity, it’s vital we make sure it’s both strong and diverse – at regional and national levels – to deliver social value across all four countries in the Union. So we’ve implemented policies to increase our spending with SMEs to 25%. Why? Because SMEs form the backbone of the UK economy. Because they have the potential to grow into the big enterprises and large-scale employers of tomorrow (just as Thales in the UK did from humble beginnings 135 years ago). And because SMEs are typically closer to their communities and employ people locally, who spend locally. When we talk to SMEs about specification and innovation, we also talk to them about social value and how we can help deliver it together.
A proven process…
Our sustainable procurement process captures what customers have asked for in terms of social value. We then ask suppliers, as well as voluntary, community and social enterprises (VCSEs), how they can help us provide goods, works, or services for the life of a contract. All in a way that promotes positive outcomes for the organisation, as well as for the economy, society, and the environment.
Of course, some very capable and innovative suppliers are aware of the social value concept, particularly as Central Government only launched it in September 2020. So part of our process is to run workshops to help them better understand what it is and why it’s important and to identify where they can contribute to a more sustainable supply chain.
…to uncover social value
Often, suppliers aren’t aware they’re already creating social value or assume the things they are doing fall under other areas like corporate social responsibility (CSR). Employing apprentices, recruiting people from disadvantaged or under-represented groups, applying eco-design principles, decarbonisation, STEM outreach, retraining or upskilling workforces, employee volunteering, and charity work – all create social value.
But building a sustainable supply chain with social value at its heart does come with its own unique set of challenges.
1. Social value has to be contract specific and forward-looking.
Perhaps the biggest hurdle to building a sustainable supply chain is that creating social value from a customer perspective has to be both contract specific, legally binding, and forward-looking. In other words, the long-term social value we create for one contract has to be specific to that contract and no other. So for each contract we bid for, we have to start with a blank canvas and look at how we can maximise the positive impacts and the long-term social value for customers, communities, society and the environment.
2. Collaboration, communication, and coordination are essential.
Another challenge for organisations and suppliers is properly coordinating the areas of a business that need to work together to create social value and ensure a sustainable supply chain. It is necessary to work across multiple business functions, with teams having to collaborate, communicate and coordinate their response in the bid process. This is easier for larger organisations in the supply chain with dedicated functions but a lot harder for smaller SMEs where one person might wear multiple hats.
3. Social value needs an inside-outside approach.
To really achieve the maximum benefits that social value can bring, you need everyone on board. That’s why, as well as putting over 150 suppliers through our social value workshops, we’ve also put our whole procurement organisation through it too. Plus, we also run supplier-specific workshops to support individual bids.
4. There are only so many hours in a day
Many SMEs we work with are also competing for other contracts, with other organisations asking similar questions around social value. This creates added pressure as there’s a finite number of apprentices you can employ, or a limit to how many hours employees can commit to volunteering in a year, for example. Ultimately, the more contracts you bid for and win, the more social value you’ll be asked to commit to creating, so managing and balancing resources – especially for SMEs – becomes crucial.
We work with various organisations like Social Value Portal to help us understand, measure, and report on social value, and Stronger Together, a not-for-profit that helps organisations adopt responsible recruitment and employment practices, and reduce exploitation in their operations and supply chains. Together, these specialists help ensure we’re building long-term sustainable supply chains while maximising social value opportunities.
We're also working hard with professional associations and industry to increase the number of SMEs in our sustainable supply chain. Not just because it’s where so much expertise and innovation lies but also because it’s a way to create and really target social value at a local level; for example, if we’re working with the Royal Navy in Portsmouth, we’ll aim to use local suppliers in and around the city and Solent.
In line with Thales’ target to be net-zero in the UK by 2030 for scope 1 and 2 emissions, wherever possible, we strive to minimise, neutralise, and offset our carbon impact through initiatives like our Low-Carbon programme. We also partner with the Ocean Conservation Trust to support the protection and restoration of seagrass habitats, and work with Forest Carbon to plant trees on a bid/contract basis. To date, we’ve planted 1,376 at Doddington North in Northumberland. We are also partnering with Peatland Restoration at Gameshope Loch and Duich Moss.
Sustainability never sleeps
We’ll continue to provide ongoing training to support our procurement professionals, encourage innovation in the supply chain in response to our customers’ social value requirements, and apply our sustainable procurement framework in a way that ensures our supply chains can deliver social value commitments.
Find out how Thales in the UK is delivering social value to the UK here. If you’re an SME looking to work with Thales in the UK, you can find out more here.