supply-chain
Environmental & Human Rights Supplier Standards | Supplier Engagement | Contractor Safety Program | Diverse Suppliers

Updated: March 2020

We strive to address environmental, social and governance elements within and beyond our direct operations. Supply chain plays a pivotal role in our external partnerships, bridging internal expectations with our suppliers to exceed our commitment towards our customers. We partner with suppliers who share our commitment towards sustainability and support our vision of a sustainable energy future.

Within APS, supply chain sustainability enables us to manage risks, protect the environment, provide value for our customers and support our communities.

Environmental & Human Rights Supplier Standards

We adhere to high ethical standards of corporate responsibility and are committed to doing business ethically. Toward that end, we provide our Supplier Code of Conduct to suppliers, vendors and others with whom we do business so that expectations for ethical business conduct are clear.  We set clear expectations for the following topics:

  • Laws, Regulations and Contracts
  • Management Processes
  • Anticorruption
  • No Unfair Business Practices
  • Gift and Business Courtesies
  • Conflicts of Interest
  • Export/Import Control
  • Counterfeit Parts
  • Financial Responsibility/Accurate Records
  • Environmental Management
  • Responsible Sourcing
  • Supplier Diversity
  • Fitness for Duty
  • Employee Health and Safety
  • Security
  • Human Rights and Fair Treatment
  • Human Trafficking and Child or Forced Labor
  • Conflict Minerals
  • Non-Discrimination
  • Subcontracting
  • Reporting Potential Misconduct

Learn more about our Supplier Code of Conduct.


Supplier Engagement

We recognize the criticality of our supply chain as we focus on a clean, sustainable future. Ongoing supplier engagement is a necessity to ensure a responsible and resilient supply chain. We engage our suppliers in a variety of ways such as industry alliances and supplier recognition.

EUISSCA Membership. As a founding member of the Electric Utility Industry Sustainable Supply Chain Alliance (EUISSCA or the Alliance), we work with peer utilities and suppliers, sharing best practices and participating in industry discussion regarding sustainability. The focus of the Alliance is to improve environmental performance and advance sustainable business practices through collaboration. This membership helps us advance our sustainability within our organization.

Through the Alliance, we distribute an annual sustainability survey to our suppliers, which enables a baseline understanding of ESG (Environmental, Social and Governance) performance within our supply chain. The survey results drive discussions allowing us to engage with our suppliers in advancing our sustainability priorities and projects.

Key Supplier Forum and Awards. We recognize exceptional supplier performance by hosting a Key Supplier Forum and Awards. Success stories are celebrated through our Supplier Excellence Awards nomination process, and awards are presented for five categories: Performance, Customer Service, Value-Added Relationship, Safety and Environmental Sustainability. To be eligible for these awards, suppliers must excel in each of these categories to be considered.

 

The Environmental Sustainability Award is presented to suppliers who make responsible choices recognizing the inherent value of the natural world by minimizing their impact through sustainable practices and work towards preserving natural resources. We value the contributions made by these suppliers and integrate their best practices to ensure successful project execution.

Learn more about our key supplier award recipients.

 

Supply Chain Sustainability Council. The Supply Chain Sustainability Council was established in early 2019, in partnership with Corporate Sustainability, to identify opportunities for driving efficiency within the company. This increased visibility on supply chain sustainability and collaboration enables solution development. For example, this collaboration led to process updates incorporating sustainability criteria within the procurement bid evaluation process. Through the cross-functional council, we now evaluate internal initiatives with a sustainability lens ensuring alignment with organizational priorities.


Contractor Safety Program

Safety is a core value at APS, and we expect our contractors to meet or exceed our safety standards. Our objective is to ensure overall site safety so that our employees, contractors and the public stay safe. We use a third-party organization that prescreens contractors based on several criteria. This data is used as part of contractor selection and bid evaluation processes, ensuring that the contractors we work with share our commitment to safety. As part of the critical focus area, all contract companies are required to review and comply with the contractor safety manual and accident prevention manual. Safety performance is monitored throughout the course of the contracted work. If an incident occurs, we ensure appropriate investigation is completed and corrective action plans are established. Further, all contractors are required to review and adhere to the Supplier Code of Conduct before engaging with APS. This includes Employee Health and Safety expectations for suppliers to provide products and services that meet applicable health and safety laws, regulations and standards, and perform operation to prevent injuries, incidents or illnesses.

In addition, all contractors are required to adhere to security and data privacy standards and follow industry best practices and applicable regulations. By evaluating contractors’ internal controls and monitoring reputation and financial standing, we further protect sensitive information. Our Data Privacy and Supply Chain teams ensure the company is protected by requiring that contracts with new and existing partners account for cybersecurity. All contractors are required to have effective security practices and controls in place, and we work with these partners to ensure our customers are protected from potential third-party data loss.

Learn more about our safety resources and expectations for suppliers.


Diverse Suppliers

We regard supplier diversity as an integral and sustainable element of our business. The majority of our diverse suppliers are based locally, which reinforces our economic development efforts in Arizona. A diverse roster of suppliers strengthens our business and our community and provides an opportunity to gain innovative ideas from suppliers that reflect our customer base. Our Supplier Diversity and Development (SDD) program helped to enable approximately $400 million in spending with diverse suppliers in 2019.

SDD hosted five supplier matchmaking events in 2019 in partnership with local chambers and agencies. The matchmaking events educated suppliers on how to do business with APS and connected them with relevant APS employees who regularly utilize similar products and services. In 2019, APS expanded its support of our local and diverse suppliers to restaurants and caterers with a food tasting event. Local restaurants and caterers who participated in the event were added to the APS Preferred Diverse Catering List utilized organization-wide.

 

We also take a proactive approach to developing diverse suppliers. Our Diverse Supplier Training Program (DSTP) is a seven-month training program providing local and diverse business owners with the knowledge and skillset to be successful growing their own businesses and working with the utility industry. We are proud to support DSTP training for over 20 years.

Learn more about APS Supplier Diversity programs.

 

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