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The Supply Chain team has set measurable targets to ensure continuous progress toward our goals. Each supply chain manager has responsibility to update their project status at least yearly, which allows the team the opportunity make sure annual targets are achievable and discuss any mitigation for targets that may be off track.
Supplier Code of Conduct
The WM Code of Conduct applies to every WM employee and our Board of Directors. Signed acknowledgments are periodically required, attesting that each recipient understands the responsibilities outlined. The Code also highlights the expectation that our consultants, contractors, vendors and other business partners will act in a manner consistent with our Code when conducting business on behalf of the company. The Code is available in print and online in English, Spanish and French.
The WM Supplier Code of Conduct was launched and rolled out in 2012, revised in 2016, 2017, 2019, and 2020 and includes information and links to the Ten Principles of the UN Global Compact. It also includes information on how to report compliance and ethics issues or concerns on our Integrity Helpline. All suppliers, contractors and service providers receive this Code as part of their contract signing (and with all renewals and modifications of existing contracts). All WM contract purchases are governed by the WM Supplier Code of Conduct. Although our Code is provided online for our suppliers and is appended to all new contracts, renewals and modifications of existing contracts, we do not retain a file of acknowledgement from our suppliers.
WM has limited operations outside of North America. To ensure compliance with international laws, WM has established an International Compliance Committee, which manages the company’s international compliance activities and oversees related processes, policies and guidelines. These activities include monitoring the company’s anti-bribery, corruption and trade compliance performance. WM provides periodic and targeted anti-corruption and Foreign Corrupt Practices Act (FCPA) training to employees who are involved in international activities. In addition to this training, every employee receives annual Code of Conduct training, which includes topics related to anti-corruption such as bribery, gifts and business entertainment, and interacting with government officials. The WM employees involved in joint ventures also receive the training described above.
We conduct periodic business reviews with Tier I critical suppliers to ensure contract and Code of Conduct compliance. The Code of Conduct includes:
- Strict bans on offering or accepting bribes, kickbacks, payoffs or other unusual or improper payments.
- A ban on making a political contribution on behalf of WM.
- An affirmative obligation to be a good corporate citizen and a trusted and valued community partner and to safeguard the environment and natural resources.
- A guideline strictly limiting gifts and entertainment.
- An expectation of accurate books and records.
- A requirement to comply with all applicable laws and regulations.
- An obligation to report all work-related incidents relevant to the contract immediately.
- A requirement to maintain a sustainable procurement policy for their own suppliers.
The Code of Conduct also includes guidance related to:
- Environmental standards for suppliers’ processes, products and services.
- Child labor.
- Fundamental human rights (e.g., labor rights, freedom of association, ILO conventions).
- Working conditions (e.g., working hours, layoff practices).
- Occupational health and safety.
- Business ethics (e.g., corruption, anti-competitive practices).
The Supplier Code of Conduct is monitored through a domestic and international WM Compliance and Ethics Helpline number. All consultants, contractors and suppliers are obligated to report any known or perceived violation of laws, regulations, WM policies or our Code of Conduct. We reserve the right to audit and inspect supplier operations during the term of the contract and for a limited time after termination.
Supplier Sustainability Risks
We have established a process to identify key supplier risk factors and determine how to mitigate those factors. We observe and check the progress of the supplier risk profile over a period of time. We methodically examine the supplier risk profile for the purpose of explanation and interpretation. A risk profile is established for the supplier and the overall category. In this way, we continually assess the strengths and weaknesses of our suppliers, and the impact these could have on our business.
1. Monitor: Observe and check the progress of the supplier over a period of time
2. Analyze: Methodically examine the supplier risk profile for the purpose of explanation and interpretation
3. Mitigate: Establish plans to reduce and manage the risk profile of a supplier
4. Certify: Establish supplier risk profile and their current service level to WM
Potential sustainability risks include financial and insurance-related risks (including compliance and governance considerations), safety and health, and supplier diversity. In our mission of continuous improvement, we check for expired or out-of-date insurance declarations through an automated system, which triggers notification to the supply chain managers for corrective action; conduct site visits and unannounced inspections of suppliers’ facilities, particularly with our top fleet suppliers; and work closely with field operations to observe the service level provided to our operations. Any slippage observed from a safety or service disruption standpoint will warrant a corrective action plan.
WM defines high-risk suppliers as those that operate or do business in or with high-risk countries, are high-dollar suppliers, are critical Tier I suppliers, provide products or services that can have a negative impact on the environment or have high safety risks, or those whose economic/operational performance is below industry peers. Potential red flags that could indicate a concern include financial and insurance-related issues (including compliance and governance considerations).
Improving Supply Chain Sustainability
As the Supply Chain team interacts with suppliers to provide the services our internal customers need, we engage with suppliers on ESG opportunities, specifically opportunities for reducing our carbon footprint and engaging with diverse-owned businesses.
All ESG factors articulated in our Procurement Policy are considered essential balancing criteria and must be considered in supplier selection. There is no formal weighting template. Compliance with regulatory ESG standards is a mandatory threshold, with carbon footprint reduction initiatives considered along with sustainability, cost, risk and other factors.
Carbon Footprint Reduction
For 2020, we included specific contract language describing the importance of sustainability to WM. In addition to communicating our sustainability goals, we plan to include the following sustainability clause in all our Master Service Agreements contracts by 2025.
WM Supply Chain team has developed a Sustainable Supplier Partnership Playbook to direct conversations with suppliers and maximize the opportunity to identify and implement new projects. A key component to this Playbook is the Supplier Sustainability Questionnaire, first distributed in 2019, which will allow our suppliers to document their sustainability programs and have ongoing dialogue on joint sustainability activities.
The Supply Chain team has also initiated sustainability Projects as a required individual goal in the WM annual goal planning process. To be considered a Project, an initiative must have a proven environmental or social benefit, such as material reduction, use of recycled content materials or GHG emissions reduction. Our goal documentation template has been updated to include supplier diversity Projects and carbon footprint reduction opportunity Projects. This template is reviewed by the entire Supply Chain team throughout the year. Each of the Sustainability Projects that the Supply Chain team manages is put into a Sustainability Project Management Tool that converts the environmental reductions into a useful metric utilizing the EPA’s Waste Reduction Model (WARM) calculations to capture environmental impacts. This tool will be the core Supply Chain Sustainability reporting tool, allowing us to systematically and consistently demonstrate our contribution to the overall ESG program.
Other departments within WM and local operational locations play a vital role in ensuring our ESG goals are met. The Supply Chain team aligns our processes and procedures to the operational needs for services. We rely heavily on daily interactions with our business partners to provide feedback through our collaborative supplier vetting process. For example, our real estate department is establishing minimum requirements for new builds, which include requirements for recycled and energy-efficient materials in its Capital Construction Projects and working closely with them to identify suppliers for controlled lighting and HVAC, occupancy sensors, recycled-content carpet and furniture, and low-emitting paints and adhesives.
Our operations are committed to responsibly managing the materials we use daily by:
- Recycling plastic garbage and recycling containers to make new plastic containers.
- Reclaiming steel from scrap containers.
- Retreading tires where possible.
- Recycling used oil for other purposes.
- Recycling the paper we use and purchasing recycled content paper whenever possible.
WM has committed to purchasing 100% renewable electricity for all WM-controlled sites. Utilizing Renewable Energy Credits (RECs), Virtual Power Purchase Agreements (VPPAs), Power Purchase Agreements (PPAs) and WMRE RECs, we plan to achieve our 100% renewable electricity goal by the end of 2025.
In addition to our efforts to utilize alternative energy sources, we are also addressing our consumption of energy, through the utilization of rooftop solar programs, LED retrofit programs and LEED certified facilities throughout our operations.
WM Supply Chain is also championing sustainability activities through influencing our suppliers to explore sustainable opportunities. We have worked with suppliers on their sustainability programs. Programs we have jointly developed include the development of a sustainability rebate program, utilization of recycled material in supplier’s uniforms and coordinating sustainability services for one of our suppliers through one of our other suppliers.
We also support the recycled paper market by recycling our own office paper and prioritizing recycled-content paper in our own supply purchases. Partnerships with suppliers, including shredding service providers, paperless billing vendors and office supply companies, help us make an impact throughout the paper life cycle.
It is WM’s privilege, policy and practice to proactively seek diverse suppliers. Through our supplier diversity program, we build relationships with businesses that are at least 51% owned by minorities, women and service-disabled veterans capable of providing commodities and services at competitive prices. By engaging and developing diverse value-added suppliers, we create a sustainable competitive advantage and build a supplier base that reflects our diverse customer base.
WM, in accordance with our business values and ESG strategies, strives to conduct business with all suppliers in an environment that demonstrates mutual trust, fairness, integrity and inclusion of different perspectives. As a critical review, we have added supplier diversity to our project review documentation that is evaluated throughout the year during category reviews and is a requirement on all supply chain members’ yearly goals.
Our goal is to have 10% growth in annual spend with diverse suppliers through 2038. Our Board of Directors receives an annual report on our spend with diverse suppliers, directly overseeing our progress toward this goal. WM does not have an internal diversity certification program, but rather recognizes third-party public- and private-sector certifications, such as the National Minority Supplier Development Council (NMSDC) and the Women’s Business Enterprise National Council (WBENC). WBENC and the Minority Business Enterprise are the main agencies we use to impact our diversity spend. Progress toward this goal was impacted by the pandemic, which led to closures of some of our supplier businesses. In addition, one of our larger diverse suppliers was acquired by a non-diverse-owned company. We purchased $335 million in products and services from certified diverse suppliers in 2021.
Supply Chain Stakeholder Engagement
WM believes that active engagement in business groups and broad-based stakeholder groups is one of the best ways to continually challenge ourselves to do better. Improving the sustainability of our fleet requires collaboration, such as membership in the National Clean Fleets Partnership. This partnership operates more than 1 million commercial vehicles nationwide, and it is committed to finding ways to improve the fuel efficiency of U.S. trucks. We are also members of the U.S. EPA’s SmartWay Transport partnership, which is dedicated to improving heavy-duty vehicle efficiency and reducing emissions throughout the transport supply chain.
In early 2021 WM initiated a Share the Green program where 365 women-owned businesses were identified and trained on how to effectively communicate a sales pitch to corporate supply chains. It was very well received, very well attended and led to business opportunities for many of the participants in the program. So far through the end of 2021, 190 of the women-owned businesses qualified to pitch their businesses and 125 of them were picked by at least one company for further discussions.