Environmental and Human Rights Supplier Standards | Supplier Engagement | Contractor Safety Program | Contractor Data Privacy | Diverse Suppliers

Updated: March 2022

We strive to address environmental, social and governance elements within and beyond our direct operations. Our supply chain plays a pivotal role in our external partnerships, bridging the internal expectations with our suppliers that help us exceed our commitment to our customers. We partner with suppliers who share our commitment toward 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 and 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.

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We set clear expectations for the following topics:

  • Laws, Regulations and Contracts
  • Management Processes
  • Anti-corruption
  • 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 ways such as industry alliances and supplier recognition.

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COVID-19 Response. As the pandemic continued in 2021, our suppliers tackled the unique challenge of assessing material availability risk and responding to shortages and increased demand for needed materials and supplies, including personal protective equipment. Through our partnerships, our suppliers supported the safety of APS employees by providing COVID-19 prevention and detection materials and ensured APS could keep providing reliable power to customers.

EUISSCA Membership. As a co-founder 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 discussions regarding sustainability. The focus of the Alliance is to improve environmental performance and advance sustainable business practices through collaboration. This 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 results drive discussions enabling 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 in five categories: Performance, Customer Service, Value-Added Relationship, Safety and Environmental Sustainability. To qualify for these awards, suppliers must excel in each of these categories. We look forward to hosting the next Key Supplier Forum and Awards in 2023. 

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 who work toward 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 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 evaluate internal initiatives with a sustainability lens ensuring alignment with organizational priorities.

CDP Supplier Engagement Rating. As part of the CDP climate change questionnaire, we are proud to be recognized by CDP as a Supplier Engagement Leader for the past four years. The CDP Supplier Engagement Leadership Rating is earned by those found to be effectively implementing best practices when engaging with suppliers to limit greenhouse gas emissions within the supply chain.  We continue to partner with our suppliers to support APS’s Clean Energy Commitment. 

Contractor Safety Program

Health and Safety are core values at APS and we remain vigilant in our commitment to a safe workplace. In 2021, APS continued its commitment to ensuring a safe and healthy work environment for our direct personnel and contractors.

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As part of this critical focus area, our contract companies are required to review and comply with the Contractor Safety Manual and Accident Prevention Manual. In addition, contractor safety performance is regularly monitored throughout the course of the contracted work. If an incident occurs, we ensure an 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.  In response to COVID-19, we continued to maintain protocols for our employees and contractors regarding social distancing, the use of face masks, travel restrictions, pre-entry health screenings and overall good hygiene practices in 2021.

APS has launched initiatives geared toward building on our safety foundation to establish a culture of trust and learning that effectively addresses safety risks and continues to reduce serious injuries and fatalities. In 2021, we focused on Serious Injuries and Fatalities as our primary safety metric. In 2021 the Safety Classification & Learning (SCL) Model established by Edison Electric Institute was integrated into our existing programs and event analysis processes. Using the SCL model, each contractor safety event was evaluated to better understand the high energy risks and hazards on contractor work as well as direct controls. We continue to work closely with our business partners, contractors, and ISNetworld who specialize in safety performance to improve our contractor safety program to align with APS values and principles.

Contractor Data Privacy

All contractors must adhere to security and data privacy standards as well as follow industry best practices and applicable regulations. By evaluating contractors’ internal controls and monitoring reputation and financial standing, we further protect sensitive information.

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Our Data Protection Assurance and Supply Chain teams ensure the company is protected by requiring that contracts with new and existing partners account for cybersecurity risk. 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. APS supports the communities we serve through partnerships with local organizations.

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Our Supplier Diversity and Development (SDD) Program focuses on three main areas: community building, mentorship and networking, and supplier development. Our partners include local supplier development organizations, chambers of commerce and third-party certification agencies. Through our collaboration and support of these organizations, APS supports programming that expands the development and growth of our suppliers. Most of our diverse suppliers are based locally, which also 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. We’ve taken a proactive approach to developing diverse suppliers for more than 25 years and our SDD Program helped to enable approximately $458 million in spending with diverse suppliers in 2021.

In 2021, SDD hosted over 30 events and engaged over 600 suppliers in training and matchmaking in partnership with local chambers and agencies. The matchmaking events and training sessions taught suppliers how to do business with APS and connected them with APS employees who regularly utilize similar products and services.

Our Diverse Supplier Training (DST) Program provides local and diverse business owners with the knowledge and skill set needed to grow their businesses and work within the utility industry. The DST Program is a self-paced online program that meets the needs of businesses with flexibility in time and proximity. It also allows a limitless number of people to participate in the free program each year and allows APS to expand its program reach to suppliers throughout Arizona and New Mexico. The online format allows us to easily connect with our suppliers and helps small, local/diverse suppliers develop industry-specific skills and tools needed to be sustainable and succeed in the electric utility industry.

Learn more about APS Supplier Diversity Programs.

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