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About Kerneos

Procurement

 

At the very heart of Kerneos' business, Purchasing is strategically important because it contributes to reaching the objectives set in terms of safety, quality, service, profitability, the environment and innovation.

KERNEOS AND ITS SUPPLIERS FORM DEMANDING PARTNERSHIPS

At Kerneos, the Purchasing function is tasked with integrating suppliers as part of the company's value chain.

Purchasing is not merely negotiation - no matter how good - nor an administrative procedure, but contributes to optimisation by having people responsible for all stages in the purchasing process and the related procurement system. This means finding a match between the company's needs and what suppliers are offering, in order to optimise the Total Cost of Ownership and to ensure the availability and durability of Kerneos' supplies.

The Purchasing function is based on Purchasing Policy, a Purchasing Organisation and a Purchasing Process.

Purchasing policy

The Kerneos Purchasing Policy consists of four key factors:

Analysing markets and building a worldwide network of suppliers through:

  • Consolidation of requirements at the appropriate level (Worldwide, Region, Country, Plant)
  • Professional Purchasing marketing aimed at finding the best sources of supply and optimising the panel of preferred suppliers
  • Strict final selection of listed suppliers meeting the prerequisites.

Building long-term relationships with strategic suppliers based on:

  • Mutually agreed commitments
  • A transparent relationship driven by a desire for continuous progress
  • Paying attention to all cost components throughout the life cycle of the products purchased.

Following policy guidelines in placing contracts by means of:

  • A fair, equitable, objective, mutually respectful selection process with all suppliers, subcontractors and partners
  • Guaranteed confidentiality of discussions and data transmitted, as if it were their own
  • Continuous improvement as a driver for effective, lasting collaboration
  • A "pioneer" spirit allowing suppliers to generate innovative proposals.

Rolling out Kerneos' commitments on sustainable development and responsible purchasing to suppliers:

  • A willingness to work with suppliers who will be present when Kerneos celebrates 200 years in aluminates
  • Acceptance sought from our suppliers of our vision of respect for people and the environment through the promotion of safety and responsibility
  • Purchasing function efficiency enhanced by regular monitoring of its performance, guaranteeing the durability of those involved in the business relationship.

Purchasing organisation

The organisation of the Kerneos Purchasing function is based on purchase segmentation built following the logic of supplier markets. When a purchasing requirement is shared by more than one in-house specifier, the purchase is managed centrally at the required level of geographic consolidation (worldwide, regional or country) by a buyer in charge of the segment in question.

When a purchasing requirement involves only one corporate entity, this purchase is then managed by that unit's local buyer. There are four purchasing segments identified within Kerneos:

  • Raw Materials and Energy
  • Transport (land, sea)
  • Overheads, IT and Telecom
  • Industrial Products and Services (investment, industrial maintenance).

Purchasing process

The purchasing process is structured to comply with Kerneos' purchasing policy in terms of the fair, equitable and objective selection of suppliers. It is based on four stages of selection and one stage of monitoring:

  • The marketing of purchases to meet stated requirements
  • Formalisation of the requirement to present a specification and enable suppliers to offer their products and services
  • Review market supply and price through a tender process
  • Negotiation and signature of contract
  • Long-term management of the supplier relationship.

The prerequisites

Working together means not only sharing values but also meeting certain obligations. Consequently, we expect our suppliers to show:

Legal and social compliance:

  • Compliance with legal and social obligations
  • Adherence to health and safety standards, with special attention paid to the improvement of the accident frequency rate over time
  • Support for sustainable development.

Consistent adherence to commitments:

  • Compliance with specifications and commitments (contracts, orders).

Economic competitiveness:

  • Solvency of suppliers, to ensure that they are in a position to meet their contractual commitments and implement their development strategy
  • Price competitiveness while maintaining quality of products and services.

Transparency and a spirit of partnership and innovation:

  • Accessibility of suppliers' plants for quality control and/or audits
  • Acceptance that our requirements may change, and creativity sought in the solutions on offer
  • Joint involvement to ensure shared success within a well-run and responsible relationship.

Technical expertise and a desire for improvement:

  • The implementation of a progress plan following recognised quality assurance procedures, to control security of procurement and improve performance
  • Active market intelligence and championing of new initiatives.

 

Key data

  • The Kerneos value chain begins with the approach of suppliers and subcontractors through a rigorous and demanding purchasing policy.