Cooperation with suppliers

Annual Report 2017 > Business > Group’s condition > Cooperation with suppliers
Highlights 2017

Business

Strong position in insurance with a periodic premium with a market share of 45.8% (+0.7 p.p. y/y, the highest level since 2010)
Strong position in insurance with a periodic premium with a market share of 45.8% (+0.7 p.p. y/y, the highest level since 2010)
Group model based on a comprehensive offering in the insurance, finance and health area
Group model based on a comprehensive offering in the insurance, finance and health area
2000 outlets at the disposal of clients in the health insurance and medical care services provided by the PZU Group
2000 outlets at the disposal of clients in the health insurance and medical care services provided by the PZU Group
Strong market position in motor insurance, including direct activity with a market share of 38.4%
Strong market position in motor insurance, including direct activity with a market share of 38.4%
Pekao ranked 2nd and Alior Bank ranked 8th in terms of accumulated assets
Pekao ranked 2nd and Alior Bank ranked 8th in terms of accumulated assets
The PZU Group’s share in the non-life insurance market is 35.7%
The PZU Group’s share in the non-life insurance market is 35.7%

GRIs:

Reference Areas:
Health
Investments
Banking
Best Pratices in PZU

Cooperation with suppliers within the PZU Group is based on mutual trust, respect and professionalism. The PZU Group aims at building long-term relations as part of long- term memoranda of agreement which guarantee adequate quality. In particular, we appreciate the suppliers which apply proven market practices and represent the highest level of professional ethics.

Transparent supplier selection rules - “We comply with the law in executing agreements. Our procurement decisions are based only on the price, quality, technical parameters and usefulness criteria.

We avoid transactions which due to their nature or method of conducting trading negotiations could give rise to doubt or create an impression of being inappropriate or illegal.” 

The suppliers selection procedure includes social and environmental criteria which are consistent with the principles of corporate social responsibility. The Procurement Department arranges purchases of goods and services for administrative, advisory, construction and renovation-related and IT needs of the PZU Group, among others. In the supplier selection process, we always follow the competition principle, hence the majority of our the purchases are made under a tender process.

The transparency of our procurement process is rooted in the internal regulations defining the organization of that process, the decision-making levels and the roles of the participants. When selecting the suppliers, we are guided by the “Supplier selection procedure”, “Contract execution rules” as well as “PZU Best Practices”. Their application is a guarantee that the procurement process will be carried out in a transparent and optimal manner.

The following initiatives are carried out in the PZU Group, which increase the effectiveness of procurement practices:

  • consistent approach and integration of the PZU Group;
  • exchange of experience within the PZU Group in order to apply market-proven and most effective procurement practices;
  • analysis of suppliers in terms of timeliness, quality and cooperation in a given area;
  • conducting regular surveys of satisfaction with the services provided by the suppliers to the PZU Group’s internal clients.

In Bank Pekao, the selection of the supplier depends on the environmental and social criteria. In the event of conducting tender procedures (exceeding EUR 1 million), the suppliers are obligated to fill out the Corporate Social Responsibility Declaration which contains, among other things, the information on environmental and social aspects as well as the issues concerning the respect for human rights. Thus, action is taken for sustainable development, protection of natural environment and prevention of breach of human rights by the group’s business partners. Moreover, when conducting the tenders, the bank verifies potential bidders from the standpoint of corruption risk and in terms of sanctions lists (sanctions lists of the USA and the EU) as well as public warnings of the KNF. The bank’s policy is also implemented by CDM Pekao, Centrum Bankowości Bezpośredniej and Centrum Kart.

In Alior Bank, the entities seeking participation in the procurement procedure are obligated to submit a special attachment to the bid – the “Business Ethics” Representation, which constitutes an element of the formal and legal assessment of the supplier. When signing that document, the bidder represents that as part of the activities conducted by it, it adheres to the commonly prevailing law and the rules of ethics including, among other things, the environmental and social criteria as well as respect of human rights.

In 2017, the foregoing practice was followed only in Alior Bank, and it is planned that in 2018 it will be adopted also by other group companies.

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